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ucodegen
ParticipantI was hoping for a response to my questions for Newblet, but I have heard nothing.
Since I have heard nothing, I’m going to respond to some statements:
@drunkle
401k, like social security, is a pyramid scheme. it depends on constant, unceasing growth.
Incorrect. Social Security is a Ponzi scheme, but 401ks are not. In Social Security, incoming payments are paying the retiring, with a small gain from from the special issue treasuries that the Social Security Trust fund buys from the Fed (which then allows congress to borrow from the trust fund while paying that interest back to the Social Security Trust Fund). 401Ks allow one to buy stock, treasuries or to hold it in a money market(depending upon what your employer offers). Stock earnings are based upon growth of companies and earnings returned to shareholders in the form of dividends. In fact, the best scenario for a 401K is absolutely no growth in price.. all dividends.. until the day you retire.. upon which all the growth in price occurs. This gives you the best dollar cost averaged rate of return. NOTE: Even someone you quote later (Suzy Orman) supports 401Ks. I don’t support her justification on how you should limit your contribs to matching only. That discussion is a long and complicated one. The answer really is… it depends. Suzy Orman grossly oversimplifies things.. though considering her target audience, it makes sense.the financial markets are not free and efficient. they are manipulated by the likes of banks, hedge funds and even the federal reserve.
Essentially correct, but their manipulation is not that transparent. Best path is to ignore the talking heads that tell you to buy one stock and sell another.. only to reverse their decisions next month. The financial markets are paid for transactions. The manipulation of the stocks can actually work to your advantage. Look for when the manipulation pushes down the price of a good company with good earnings. A good quote: be fearful when others are greedy, be greedy when others are fearful – Warren Buffett, no relation to Jimmy.401k’s are tax deferred, not tax exempt. big difference and the rate of taxation in the future may change, your income in the future may make tax deferment moot.
Not really. The growth also occurs on the amount that got deferred (which would have gone to the taxman). Later changes to tax law can also change taxation on other sources… including Roths. Nothing is really secure… just do the best possible. To outrun a Bear, you don’t have to be the worlds fastest runner… just be faster than the other guy.growth in the stock market correlates with the creation of the 401k in the early eighties.
It also correlates to the drop in interest rates. In reality, it is a poor correlation to 401Ks, but very good correlation to interest rates. Most people do not exercise the 401K options (verified by the HR at my company and company of previous employment).1) have children who are smart, educated, skilled and wont dump me into a gutter (the 401c plan; have 401 children)
Good luck. With the examples that the media is presenting.. I would not bet on being out of the gutter. Even your Suzi Orman quote references to not being a burden to your children in later life.2) be independently wealthy either through size of bankroll or moving to singapore.
Singapore is not that cheap. Korea is getting expensive too. Thailand is still on the cheap side as well as Cambodia and Vietnam. So is Alaska(but man is it cold) While you are holding cash and trying to build the big bankroll, Bernanke and inflation is making each dollar worth less and less while other currencies are getting stronger.3) die young. 65 is pretty young these days…
Well there is always that…ParticipantI was hoping for a response to my questions for Newblet, but I have heard nothing.
Since I have heard nothing, I’m going to respond to some statements:
@drunkle
401k, like social security, is a pyramid scheme. it depends on constant, unceasing growth.
Incorrect. Social Security is a Ponzi scheme, but 401ks are not. In Social Security, incoming payments are paying the retiring, with a small gain from from the special issue treasuries that the Social Security Trust fund buys from the Fed (which then allows congress to borrow from the trust fund while paying that interest back to the Social Security Trust Fund). 401Ks allow one to buy stock, treasuries or to hold it in a money market(depending upon what your employer offers). Stock earnings are based upon growth of companies and earnings returned to shareholders in the form of dividends. In fact, the best scenario for a 401K is absolutely no growth in price.. all dividends.. until the day you retire.. upon which all the growth in price occurs. This gives you the best dollar cost averaged rate of return. NOTE: Even someone you quote later (Suzy Orman) supports 401Ks. I don’t support her justification on how you should limit your contribs to matching only. That discussion is a long and complicated one. The answer really is… it depends. Suzy Orman grossly oversimplifies things.. though considering her target audience, it makes sense.the financial markets are not free and efficient. they are manipulated by the likes of banks, hedge funds and even the federal reserve.
Essentially correct, but their manipulation is not that transparent. Best path is to ignore the talking heads that tell you to buy one stock and sell another.. only to reverse their decisions next month. The financial markets are paid for transactions. The manipulation of the stocks can actually work to your advantage. Look for when the manipulation pushes down the price of a good company with good earnings. A good quote: be fearful when others are greedy, be greedy when others are fearful – Warren Buffett, no relation to Jimmy.401k’s are tax deferred, not tax exempt. big difference and the rate of taxation in the future may change, your income in the future may make tax deferment moot.
Not really. The growth also occurs on the amount that got deferred (which would have gone to the taxman). Later changes to tax law can also change taxation on other sources… including Roths. Nothing is really secure… just do the best possible. To outrun a Bear, you don’t have to be the worlds fastest runner… just be faster than the other guy.growth in the stock market correlates with the creation of the 401k in the early eighties.
It also correlates to the drop in interest rates. In reality, it is a poor correlation to 401Ks, but very good correlation to interest rates. Most people do not exercise the 401K options (verified by the HR at my company and company of previous employment).1) have children who are smart, educated, skilled and wont dump me into a gutter (the 401c plan; have 401 children)
Good luck. With the examples that the media is presenting.. I would not bet on being out of the gutter. Even your Suzi Orman quote references to not being a burden to your children in later life.2) be independently wealthy either through size of bankroll or moving to singapore.
Singapore is not that cheap. Korea is getting expensive too. Thailand is still on the cheap side as well as Cambodia and Vietnam. So is Alaska(but man is it cold) While you are holding cash and trying to build the big bankroll, Bernanke and inflation is making each dollar worth less and less while other currencies are getting stronger.3) die young. 65 is pretty young these days…
Well there is always that…ParticipantIs it still possible to find an unclaimed piece of property and buy claim it old west style? I was told that the 5 homes overlooking Swami’s to the south of the parking lot in Encinitas.
There are two categories to look up here.
Ownership by adverse possession. (applies to owned property)
Homestead act. (applies to gov land, not talking about homestead protection from default.. ie ‘new’ California Homestead act)There really is not any ‘unclaimed’ property anymore. Either it is gov owned or private.
ParticipantIs it still possible to find an unclaimed piece of property and buy claim it old west style? I was told that the 5 homes overlooking Swami’s to the south of the parking lot in Encinitas.
There are two categories to look up here.
Ownership by adverse possession. (applies to owned property)
Homestead act. (applies to gov land, not talking about homestead protection from default.. ie ‘new’ California Homestead act)There really is not any ‘unclaimed’ property anymore. Either it is gov owned or private.
ParticipantIs it still possible to find an unclaimed piece of property and buy claim it old west style? I was told that the 5 homes overlooking Swami’s to the south of the parking lot in Encinitas.
There are two categories to look up here.
Ownership by adverse possession. (applies to owned property)
Homestead act. (applies to gov land, not talking about homestead protection from default.. ie ‘new’ California Homestead act)There really is not any ‘unclaimed’ property anymore. Either it is gov owned or private.
ParticipantIs it still possible to find an unclaimed piece of property and buy claim it old west style? I was told that the 5 homes overlooking Swami’s to the south of the parking lot in Encinitas.
There are two categories to look up here.
Ownership by adverse possession. (applies to owned property)
Homestead act. (applies to gov land, not talking about homestead protection from default.. ie ‘new’ California Homestead act)There really is not any ‘unclaimed’ property anymore. Either it is gov owned or private.
ParticipantIs it still possible to find an unclaimed piece of property and buy claim it old west style? I was told that the 5 homes overlooking Swami’s to the south of the parking lot in Encinitas.
There are two categories to look up here.
Ownership by adverse possession. (applies to owned property)
Homestead act. (applies to gov land, not talking about homestead protection from default.. ie ‘new’ California Homestead act)There really is not any ‘unclaimed’ property anymore. Either it is gov owned or private.
ParticipantSome questions:
1) What are the rollover rules on the 401k?
1.a) Do you get to roll over your contrib to a rollover IRA when/if you leave the company?
1.b) Do you get to roll over the vested company contrib to a rollover IRA when/if you leave the company?
1.c) Do you get to roll over a percentage of your contrib on a periodic basis when still in service(still employed at this employer)?
1.d) Do you get to roll over a percentage of the company contrib on a periodic basis when still in service(still employed at this employer)?
2) Do you plan to stay there more than 3 years barring unforeseen circumstances?
3) Do you feel comfortable running your own Rollover?ParticipantSome questions:
1) What are the rollover rules on the 401k?
1.a) Do you get to roll over your contrib to a rollover IRA when/if you leave the company?
1.b) Do you get to roll over the vested company contrib to a rollover IRA when/if you leave the company?
1.c) Do you get to roll over a percentage of your contrib on a periodic basis when still in service(still employed at this employer)?
1.d) Do you get to roll over a percentage of the company contrib on a periodic basis when still in service(still employed at this employer)?
2) Do you plan to stay there more than 3 years barring unforeseen circumstances?
3) Do you feel comfortable running your own Rollover?ParticipantSome questions:
1) What are the rollover rules on the 401k?
1.a) Do you get to roll over your contrib to a rollover IRA when/if you leave the company?
1.b) Do you get to roll over the vested company contrib to a rollover IRA when/if you leave the company?
1.c) Do you get to roll over a percentage of your contrib on a periodic basis when still in service(still employed at this employer)?
1.d) Do you get to roll over a percentage of the company contrib on a periodic basis when still in service(still employed at this employer)?
2) Do you plan to stay there more than 3 years barring unforeseen circumstances?
3) Do you feel comfortable running your own Rollover?ParticipantSome questions:
1) What are the rollover rules on the 401k?
1.a) Do you get to roll over your contrib to a rollover IRA when/if you leave the company?
1.b) Do you get to roll over the vested company contrib to a rollover IRA when/if you leave the company?
1.c) Do you get to roll over a percentage of your contrib on a periodic basis when still in service(still employed at this employer)?
1.d) Do you get to roll over a percentage of the company contrib on a periodic basis when still in service(still employed at this employer)?
2) Do you plan to stay there more than 3 years barring unforeseen circumstances?
3) Do you feel comfortable running your own Rollover?ParticipantSome questions:
1) What are the rollover rules on the 401k?
1.a) Do you get to roll over your contrib to a rollover IRA when/if you leave the company?
1.b) Do you get to roll over the vested company contrib to a rollover IRA when/if you leave the company?
1.c) Do you get to roll over a percentage of your contrib on a periodic basis when still in service(still employed at this employer)?
1.d) Do you get to roll over a percentage of the company contrib on a periodic basis when still in service(still employed at this employer)?
2) Do you plan to stay there more than 3 years barring unforeseen circumstances?
3) Do you feel comfortable running your own Rollover?ParticipantI do think that the existing CDO holders want to make the liabilities of the CDO/MBS packages look minimal. To that extent, this interest rate freeze may do that. The problem is that the corner of the rock has been picked up.. looked under.. and man is it ugly. I don’t think this can be so easily painted over. As an investor, I wouldn’t want to be locked into a 7% yielding investment with a 50% chance of losing 20% of my principle on a 5 year span. I would rather take the 20% right now, and find a better place to put the money.
On the other side of the coin, the freeze will tend to hold people within a rapidly devaluing piece of property. If they are not already underwater, they will be in 5 years (unless the Bernanke flush inflates everything else).
What is really important are rules changes for mortgage brokers and real estate agents, establishing their true fiduciary responsibility and with true repercussions on violations.. rules that are much along the lines of Series 3, and Series 7 licenses for stock brokers. A mortgage broker is not required to find you the best mortgage, so they serve themselves and the mortgage companies. They will present the most expensive mortgage they thing you can afford and that you would go for. Same story with the buyers broker and the ‘hidden bid’ trick.
ParticipantI do think that the existing CDO holders want to make the liabilities of the CDO/MBS packages look minimal. To that extent, this interest rate freeze may do that. The problem is that the corner of the rock has been picked up.. looked under.. and man is it ugly. I don’t think this can be so easily painted over. As an investor, I wouldn’t want to be locked into a 7% yielding investment with a 50% chance of losing 20% of my principle on a 5 year span. I would rather take the 20% right now, and find a better place to put the money.
On the other side of the coin, the freeze will tend to hold people within a rapidly devaluing piece of property. If they are not already underwater, they will be in 5 years (unless the Bernanke flush inflates everything else).
What is really important are rules changes for mortgage brokers and real estate agents, establishing their true fiduciary responsibility and with true repercussions on violations.. rules that are much along the lines of Series 3, and Series 7 licenses for stock brokers. A mortgage broker is not required to find you the best mortgage, so they serve themselves and the mortgage companies. They will present the most expensive mortgage they thing you can afford and that you would go for. Same story with the buyers broker and the ‘hidden bid’ trick.
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