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February 1, 2013 at 4:30 PM in reply to: No money down loans are back…(psuedo-affluent borrowers only..) #758777February 1, 2013 at 4:10 PM in reply to: No money down loans are back…(psuedo-affluent borrowers only..) #758774
earlyretirement
Participant[quote=The-Shoveler]Hmmm I mean I wonder it they could call the loan if the portfolio assets price falls ?
In some respects this does look like a margin loan,Seems complex maybe too complex.[/quote]
And what happens if the value of the assets were to have a sudden fall? With a margin account you get a margin call but how would it work here?
February 1, 2013 at 4:09 PM in reply to: No money down loans are back…(psuedo-affluent borrowers only..) #758770Participant[quote=livinincali]It always amazes me that everybody thinks they can win the leverage arbitrage game. Don’t worry I’m going to borrow at 3% and make 7-8%. While some have proven to be successful at this, and usually cash in big with a book or a seminar, the math says that for every winner at this game they has to be a loser. In most cases there’s a couple big winners and a lot of losers wondering what went wrong.[/quote]
Funny. I just saw it online at a different link. I figured someone would have posted about it here at Piggington and I was right. I totally agree with you livinincali. It will be interesting to see the availability of these and if they become main mainstream amongst the affluent here in California.
Flu, do you know which institutions are offering this besides BOK Financial, Citi Private and BNY Mellon? The article makes it sound like several institutions are offering this product.
Participant[quote=flyer]
Agree that many Boomers, and younger people just starting out, will most likely have to leave CA for retirement, employment, housing, and tax purposes, but many, like myself, and just about everyone I know, plans to stay–because (after checking out most of the world), there’s no other place we want to live.
Yes, other less expensive, and more tax-friendly areas such as AZ (where we also have some rentals) and TX, etc., are booming again, and I think they will continue to attract many who are looking for financial relief.
CA, and San Diego in particular, is a tough place to sustain a high standard of living from the working years all the way through the retirement years.
Even those who are making the “big bucks” here today, may not be able to sustain their lifestyles here for the balance of their lives–should they choose to do so. Overall, it will be interesting to see how this all plays out over the years.[/quote]
Great points as usual flyer. And I totally agree with you on all of these points. I think I’ve mentioned this before but I had about 8 college friends that moved here out of college and none of them live here anymore. Most moved out for employment reasons. (Of course during the bubble years they would rave about how great living in San Diego was and when the real estate market crashed all I’d hear is how SD sucks).
We will definitely be here for the long haul. As flyer mentioned, this is one of the most desirable cities around the world to live in. My family and I travel quite a bit around the world. We own a few properties abroad and my kids were even born abroad. When we decided to settle down and raise our kids we could have moved anywhere but we chose San Diego.
If you can comfortably afford it, there are few places around the world where I truly believe the overall quality of life (especially to raise kids) is better than the NCC area.
No doubt it’s not for everyone. But it will always be a desirable area for people to live. But I’m curious how things will play out as well over the next decade or two.
January 27, 2013 at 4:09 PM in reply to: The Phil Mickelson Effect and California: Taxed to the MAX!!! #758593ParticipantI’m NOT a fan of taxes and I agree California has way too many taxes. But this isn’t the environment/climate/economy for people making $50+ million a year to complain about high taxes.
It’s clear his PR team (and probably sponsors) had no clue he was going to do this and they would have NOT approved. Hence the public apology.
I don’t feel sorry for the taxes Phil pays just like I don’t feel sorry for all the taxes the CEO of Goldman Sachs pays each year.
Phil doesn’t seem like the type that could stay over in Singapore and raise his family. Will he end up in Florida or Texas and establishing residency there? Probably. Phil is free to complain about taxes but he has to accept the flack he will take from the public.
In today’s environment where there is such a sense of entitlement from people that want wealthy to support them, it’s probably better to lay low and not let people know you make $50 million a year. Most people probably never imagined that Phil made this kind of money each year. And many of them have an image of him now as a spoiled wealthy guy making tens of millions a year complaining about taxes.
Again, I’m not saying he isn’t right the taxes are too high in California, but he will get VERY few that feel sorry for him making the kind of money he does. Especially for being in a sport which he loves.
January 27, 2013 at 12:18 PM in reply to: The Phil Mickelson Effect and California: Taxed to the MAX!!! #758588Participant[quote=SK in CV][quote=meadandale][quote=SK in CV]He’s overstated his tax rate by at least 10%. He doesn’t pay anywhere near 62 or 63% as he claimed. It can’t be anymore than 52%.[/quote]
Top Fed Rate (39.6) + Top CA Rate (12.3) + Full Fica + New surcharge (15.3 + 0.9) = 68.1%
Since he makes most of his money above the margin where these rates kick in most of his money is taxed at the full rates.[/quote]
No. I was wrong on the 52%, it’s closer to 55%.
FICA for 2012 was 4.2%. It’s 10.4% if he’s self employed. But only on the first $110K. For 2013 it’s 6.2 and 12.4 respectively on the first $113,700. Mickelson is reported to have earned $48 million. So the most he could have paid in 2012 was around $11,500. In 2013 it will be about $14K. Which is less than .03% of his income.
He’ll also be able to deduct 20% of CA tax, bringing his net tax down by 1%.
39.6 + 3.8% surcharge + CA tax 13.3%, FICA .03%, less value of state tax deduction of 1% = 56%. But he still gets the benefits of the lower rates on taxable income under $450K federal and $1M for CA, which would bring his net rate below 55%.[/quote]
Yeah, I posted this on another forum.
http://money.cnn.com/2013/01/23/news/economy/mickelson-taxes/index.html?iid=SF_PF_Lead
I’d like to see how he came up with the 63%. Me thinks Phil needs to find a new accounting firm if he really is paying 63%. Also, it’s totally ironic and a bit funny that he has KPMG on his hat and sponsor.
I’m NOT saying that he doesn’t pay a lot of taxes and I think it should be less but definitely I think he didn’t give a realistic number which makes him look even sillier complaining about all the taxes he pays.
Participant[quote=flu][quote=AN]
Some of them being institutional I guess now.[/quote]
I was always curious how much institutional buying there is in San Diego. My friend/client lives in Sacramento and he is big time into real estate. He himself bought 30 properties last year alone (most with cash).
He told me that Blackstone purchased 1,200 homes in the past 5 months alone in Sacramento so it’s difficult to find any good deals now.
Any one have a clue how much institutional buying is going on in San Diego?
ParticipantYep. I’m not going to short HLF. It’s risky as there are a lot of guys that have much more money than Ackman. Sometimes even when you’re right you have to have enough money (and time) to back it up.
Ultimately Ackman could be right but it could take many years like MBIA did. Granted in that case his patience paid off. He made something like over a billion bucks on that one.
Short squeezes are fun to watch as long as you’re not shorting those stocks.
I have no skin in the HLF game and probably never will but really exciting to watch how this turns out.
ParticipantMan for anyone in the finance or investment realm…this HLF battle is really one for the ages. It will be interesting to see who wins. One side is going to lose a LOT of money.
For those of you that missed the video it’s here:
http://www.businessinsider.com/video-bill-ackman-and-carl-icahn-fight-on-cnbc-2013-1
One thing I’ll say is Ackman is a very smart guy. I made lots of money on a short position on MBIA during the financial crises thanks to Mr. Ackman.
Many people tried bullying him but ultimately on that position he made a bloody fortune. Read the book Confidence Game. Very interesting story.
I haven’t shorted HLF but man I’m interested who ultimately wins that battle.
Participant[quote=livinincali]
How much is that experience worth to you and how exactly is that experience different than moving out of your parents house, moving in with some roommates and getting a job to pay for it. Moving out of your parents house and getting the experience of living on your own is what you describe. Why do you think it takes college to live that experience.There’s plenty of non-college students in their early 20’s that live a lifestyle really similar to the college students. They get a lot of those same experiences and they didn’t have to pay for college to do it. Now college might feel like a safer place to send your child. It’s a more controlled environment and colleges today will help babysit your kid a bit, but it’s really not that different.[/quote]
Oh I’m not disputing that your route produces any less of a “learning” experience. It’s just that unfortunately I think the kid in that scenario has far fewer opportunities to enter the job market and get a job.
Hopefully I’m wrong and things REALLY change in the next decade. But I’ll continue to save each month as I don’t see college getting any cheaper the next decade and I still think in the next decade or so a traditional college experience will still have a better opportunity to get a strong job vs. the online diploma route.
This is one of those times when I’d like to be wrong.
January 24, 2013 at 3:15 PM in reply to: Over 21% of homeowners in SD County have paid off houses #758502Participant[quote=bearishgurl]
ER, I’ve never had a position for which there was “downtime.” When the mainframe was “down,” it simply meant we had a lot more fancy footwork and phone calling to do until it came back up again.
Have you ever made 400 calls a day on a rotary phone with a pencil eraser??[/quote]
Nope. Admittedly, I’ve never had to make 400 calls a day on a rotary phone with a pencil eraser. I have however received over 700 emails in a 24 hour period with all of them expecting to have their email answered that same day. And not able to sleep until each and every one of them were answered. No ifs, ands or buts. And that’s while having meetings all day with employees, clients, vendors, etc.
I’m not even saying that you didn’t deserve your pension. I’ll go on record as saying that the majority of people out there that are receiving some pension probably deserve it through many decades of long, hard work.
Personally, I’d love a pension. And if I had one, you can be sure I’d be arguing why I deserved it. 🙂
January 24, 2013 at 11:29 AM in reply to: Over 21% of homeowners in SD County have paid off houses #758453Participant[quote=FormerSanDiegan] I can’t really relate to you and your universe with defined benefit plans and hourly worker drones who don;t think about work after 5:00.
So, I have nothing to say about them or their pensions, but just wanted to defend those folks who work in the more modern salaried environment that you were pointing out as lazy.You and I simply live in orthogonal universes on this particular subject.[/quote]
I agree with those that say that many in today’s generation have a much different working environment.
Just using my dad for example, he was a “company man” and retired with a big Fortune 500 company. He worked at the same company for 30 years. He was a really hard worker but for the most part he got to the office at 8 AM and left by 6PM, with few exceptions. I can’t remember him bringing work home with him too often. When he went on vacation it was all vacation and he didn’t check in with work and they certainly didn’t have email back then.
Fast forward to today’s working environment and for many of us, we are on call 24/7 as someone else mentioned. Back then they didn’t have Blackberries/Iphones/Smartphones where a client might get annoyed if you don’t answer within a few minutes. There was no Internet where things are instantly available. Things took much longer and it wasn’t instant like it is now. The efficiency just wasn’t there which meant they had more down time.
When we go on vacation, we still are working (at least I am). Plus the world is much different now and things are much more global. I have multiple offices in different countries across different time zones. Also, I have clients in almost every continent so I’m available when THEY are available. These types of things, most boomers didn’t have to deal with in their everyday working environments. Today’s generation it’s not uncommon to deal with clients/superiors in different countries.
I’m not going to say the boomers didn’t have their own stress. However, I’m sure it was very comforting to have the feeling in the back of their minds if they worked hard X years, the company was going to take care of them, or at least fund a big part of their retirement if they worked hard. Today’s generation doesn’t have that for the most part. No one is going to take care of us but us.
Participant[quote=UCGal]
They are trying to convince me to consider teaching for one of these programs as a part time gig in semi-retirement. I’m considering it – but still have to get past the profit over student’s interest piece that bugs me.[/quote]
UCGal,
That sounds like a wonderful opportunity for part-time work in semi-retirement.
Absolutely these on-line degrees I’m sure will pick up and become more popular. But quite honestly for me I learned more from college just going through the 4 years and going through the entire experience, dealing with people, living in the dorm my first year, living in a fraternity, etc.
The entire “college experience” was amazing to me. Looking back, I wouldn’t have changed anything about the experience. In fact, I want my kids to go through that experience rather than sitting at a desk learning online.
I think many people underestimate the social setting and the lessons you learn as a young adult navigating through that and dealing with so many groups of different types of people.
I think making it through college helps shape a person and makes them who they become as adults. That’s part of the reason why I think that colleges and universities will be able to charge what they do. I know many people that have the same opinion.
By the time my kids reach college if someone gives me the option to have them study and get an “online degree” for $X or go to a reputable and respected traditional University for $XXXXXX, I will still choose the traditional route even though it’s more expensive.
Participant[quote=EconProf]LivininCali you are sooo spot on.
HS grads are rapidly waking up to the misrepresentations of the entrenched interests, AKA the education industrial complex, lenders, guidance counselors, tenured professors, etc. They know that many of the titans of high tech did not have time for college. They know of too many college grads working as barristas and waiters living in their parents’ basements and contemplating their $100,000 debt. And when they throw in lost income from four years (or five, or six) when they could have been learning a trade or building a business, they are rapidly changing their minds.
The employers too are learning that the college degree is devalued and proves little in terms of their productivity. Too many high school grads go reflexivly to college that do not have the aptitude, interest, or finances for it. They go for the social life, or their parents’prestige.
On-line education promises to cheaply and effficiently teach specific courses and skills, and then award certificates after testing and proof of mastery of that particular subject. Job seekers in the future will have to prove certain competencies in line with the employer’s needs in order to be hired. No more using a mere college degree as a “signaling system” to hire a dozen college grads and hope that a few turn into long-term employees.
Many of today’s colleges and universities will be gone in ten years, and the survivors will be vastly restructured. Learning will be vastly cheaper and more accessible to the poor (esp. in the third world), and the anachronism of tenure will be on the way out. It’s all good.[/quote]I wish I could say that I see long-term systemic changes in the college/University cost structure in the next decade but I just don’t see that being the case. While some institutions might not be here in ten years, I don’t think the costs/fees are going to go down in the next decade.
Unfortunately probably the contrary. This kind of thing is hard to turn around as we’ve mentioned.
Personally, I don’t think you actually learn a whole lot in college. I think you learn much more with real life work experience and on the “street”. However, a University degree from a credible/respected University will probably always be a necessity to get a good and decent job (or at least higher paying).
College to me is a necessary “stepping stone” and part of something you have to go through to get a good entry level position of any decent pay while you’re young.
I do think more and more people are taking a good look at what they decide to major in. When I went to school, parents didn’t really have too much input on what their kid’s major was. Now, many of my friends and client’s tell their kids if they want to have their college paid they need to have a dual major with at least a degree that isn’t fairly worthless.
I wish I was as optimistic as some of you with how the online education will change the cost structure of a college degree but I don’t see this happening anytime soon.
My prediction is a University degree from a respected university will be much more expensive 10 years from now as it is today.
January 23, 2013 at 12:20 PM in reply to: Over 21% of homeowners in SD County have paid off houses #758334Participant[quote=bearishgurl]
I have to laugh at the Piggs’ (primarly Gen Y on this forum who have worked less than a decade and already want to “retire,” lol) opinions on why I don’t deserve my small pension. [/quote]
BG,
I was in no way, shape or form hinting that you somehow didn’t deserve your pension so I hope you didn’t take it that way at all. Absolutely I think that almost most people that are receiving a pension these days probably earned it through lots of years of hard work or service to their employer.
I do partly agree with your point that it is laughable at some Gen Y’s (I’m not referring to anyone on this forum) that want to retire early without many years of hard work. I’ve met several young Gen Y’s that want to get rich with a good idea or the next Iphone App. Sure, that can happen but it’s not likely.
At the same time, I don’t think you can look at some of the Gen X’ers and Y’s and assume they have done no hard work or have it easy. I’m sure some people that I don’t know mistakenly think that I’m some trust fund kid or something. But what they don’t see is many many years of 17 hour days, lots of stress, difficult working environment, etc. The path to early retirement can’t always be assumed that someone had it easy just by looking at their age.
Some of these Gen Y’s or X’s might work in one 24 hour period what a Boomer might have done in 3 normal business days. I guess it just depends on the exact situation. But you have to keep everything relative. Just because someone worked 25-30 years for a company doesn’t necessarily mean they worked as hard or as many hours as someone else working 10-15 years for another company/industry. It’s all relative.
I can almost assure you that my 18 years working since graduating college is going to be more long hard hours working vs. some boomers and probably more stress as well.
[quote=flyer]
Agree, ER. As I mentioned in the response to flu, we’ve pretty much lived a “retirement lifestyle, ” most of our lives, and tried to enjoy life to the max, even as we planned for the future.[/quote]Absolutely! This is the best way to go, IMHO. You have to have a good balance. I’ve seen and met people that didn’t really live life at all. Some have never left the State they were born and raised. (and it’s perfectly ok if they didn’t like to travel) but some always talked about that exotic trip they were going to take or had magazines stacked up in their house of all the things they planned to do in retirement. Some drove crappy cars around their entire lives, never dined out at a nice place, and were very stingy with money with their kids who could have used it.
Then they die and all of a sudden you hear that they had an estate worth millions and millions. I always kind of laugh in that situation. While I do agree that you should save and prepare for your retirement and older age….. there are lots of people that don’t really “live”.
You said it best flyer.. “enjoy life to the max”. That’s what we do too. I’d rather really enjoy life, travel and see things and go places that I’ve always dreamed. Expose my kids to new cultures, new languages, new cities, new countries, new experiences. Try not to spoil them but to give them things my parents could never give me. That vs. leaving my future grandkids sizable fortunes.
“Enjoy life to the max” like you said. Which if you can afford it means living in a great house in a great area, driving a nice car, traveling to the places you want to go, etc. You only live once.
[quote=UCGal] (Heck, I don’t count my primary home’s equity since I don’t plan to move,sell, or borrow against…. ever. So in my mind it’s kind of like a car… an expense that provides shelter.)[/quote]
That’s exactly right UCGal. I don’t count my primary home’s equity either in my “#”. Although it’s completely paid off, I don’t plan to move, sell it or borrow against it. If I did sell it, I’d buy another place to live in so I look at it like you and just look at it as shelter.
Too many people count their nest egg on the value of their house.
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