Explain gold investing to me??

[TnAndy]

well sorry, i still dont believe in gold investing. i now have 2 rental houses that bring in between 1,500 - 1,600 per month income plus the depreciation at the end of the year on the money invested. these houses have no loans on them, so all income is mine.

These houses are what i call tangible investments, cause they are in areas that will always increase in value over time. Heck the house i bought last December is already appraising at nearly $8,000 over what i paid for it.

And i sure love the email every month showing an additional 15-1600 in the bank without lifting a finger.

Some years back, I had 3 rental houses I built for cash as I went ( rolling rent of #1 into building 2 and 3). Since I did all the labor, and sawed out much of the lumber off my place, I had very little in some very nice single family homes. ( Oak doors/trim/hardwood floors/etc....nice). My thinking was "build a nice house, get nice rent, avoid the low end problems of the market ( which is basically money problems )."

Didn't work out for me. I some GREAT tenants. I got some that tore the places up. I got some I still had to chase the rent. I decided rentals were not for me. (The depreciation, by the way, is simply delaying your tax payment. It will be re-captured if you ever sell.) Real estate does not always increase in value. You have to know when to sell to capture a real gain. The houses I sold still won't bring what I sold them for 8 years later.

So, I sold right about the peak of the 'boom' ( or bloom ) in 2005,06 and put it all in gold at 7-900oz. There is no insurance required, there is no real estate tax required, there is no maintenance required, it just sits in a box.

I sleep fine at night.

 

[sid79]

I have some gold and silver too... but I don't call it investing..

I have my regular savings account, and my 401K, the gold and silver is for me something I enjoy, I am switching over to sovereigns,gulden,D-mark and franken, I love the history..

a few years ago I made something like 3times the amount I payed for the gold after I sold it... so if all the stars align right, you could make money with it..
but like I said, I have no plans in selling.

im from Germany, after worldwar 2 they introduced the Deutsch Mark, every citizen became a little starting capital but the old money was worthless... those who held their gold and silver (and other assets) trough the war could secure their wealth..

I too have some guns, and im looking for land, but.. I certainly not see those things as investments, gunlaws could change and make your investment unsellable,, ( in know, all Americans tell me that could never happen, but Europeans and Australians said the same) and land? I cant take it with me and its hard to hide, so fully taxable for the government....

whatever you do, just don't put all your eggs in one basket, ideally you have enough baskets that if you lose one you still can recover...

 

[Kryton619]

well sorry, i still dont believe in gold investing. i now have 2 rental houses that bring in between 1,500 - 1,600 per month income plus the depreciation at the end of the year on the money invested. these houses have no loans on them, so all income is mine.

These houses are what i call tangible investments, cause they are in areas that will always increase in value over time. Heck the house i bought last December is already appraising at nearly $8,000 over what i paid for it.

And i sure love the email every month showing an additional 15-1600 in the bank without lifting a finger.

No need to be sorry. I own two apartment buildings...one with 21 units and the other with 11 units. These are my investments...like I said my gold and silver I don't consider to be investments. I truly believe that 2008 was just a warm up for what will come. Nothing has changed....all the policy makers have done is kick the can down the road. Canada and the US both have debt levels that are unsustainable. What happens when interest rates do eventually rise? The cost to service the US debt of greater than 17 trillion dollars will equal or exceed what the US currently spends on military. Where does that money come from?

While I also enjoy the rental income every month, when the dollar collapses and people can no longer pay rent, I have a good chunk of wealth in real money. It doesn't have to be one or the other, you can have both.

 

[Kryton619]

So, I sold right about the peak of the 'boom' ( or bloom ) in 2005,06 and put it all in gold at 7-900oz. There is no insurance required, there is no real estate tax required, there is no maintenance required, it just sits in a box.

I sleep fine at night.

Very true. It is one of the few assets with absolutely no counter party risk.

 

[Gale Hawkins]

TnAndy we all could wish to have been able to do the same. That is a good return for sure.

 

[TnAndy]

I truly believe that 2008 was just a warm up for what will come. Nothing has changed....all the policy makers have done is kick the can down the road. Canada and the US both have debt levels that are unsustainable. What happens when interest rates do eventually rise? The cost to service the US debt of greater than 17 trillion dollars will equal or exceed what the US currently spends on military. Where does that money come from?

Time honored tradition of all governments: They will print it into oblivion until the dollar joins all the rest of the paper currencies on the dust heap of history. That is a safe bet.

While I also enjoy the rental income every month, when the dollar collapses and people can no longer pay rent, I have a good chunk of wealth in real money. It doesn't have to be one or the other, you can have both.

I agree, you can have both. I just decided I didn't have the stomach to handle rentals. I put a lot of "me" into building those and took a lot of pride in how they turned out. For someone to let their kids kick holes in the walls, run a ATV into a brick wall beside the garage door ( Opps....he missed the door ), repaint the walls in their room flat black, have pets when we clearly agreed no pets, and so on and so on, simply made me want to kill someone. Rental income isn't worth much at the prison commissary....

We planned for enough retirement income that the rental income isn't needed, including financing some land for a buyer at a much better than bank interest income.

And that part in bold played into my decision as well. I do think at some point not too far down the road, the ability to pay rent is going to be a serious issue for landlords. My neighbor, who has been in the 'lower end' of the rental market for years now, is forever moaning about how far behind his renters are.

 

[TnAndy]

TnAndy we all could wish to have been able to do the same. That is a good return for sure.

Thanks Gale. I'd like to claim is was some skill, but in truth, I was simply quite lucky in timing. I had always planned to sell, about the time things like HVAC, roofs, appliances needing replacing ( say 10 years or so ), but I got sick of renters about 5 years in.....which did just happen to be about market peak. Fate I guess.

 

[Kryton619]

but I got sick of renters about 5 years in.

I got sick of them quicker than that....I must be a glutton for punishment.

 

[TnAndy]

I got sick of them quicker than that....I must be a glutton for punishment.

ahahaaaa...I hear ya.....

Had some GREAT ones. First guy that rented my 2nd house when it was brand new was a military guy. He had the Army finance office send me the rent check. I could open the mail box on the day due, and it was there every single time. When he left, he did a "GI Party" and honestly, the place looked better than the day I gave him the keys.

Next tenant was a manager at Lowe's home store.....good job. Single mom, two teenaged kids. She would to out to work early and come in late, and basically left the two kids to raise themselves. So they did what any unsupervised kids would do.....wrecked the place. THEN Mom didn't want to pay for it....not her problem. Took a trip to court to get 'somewhat' even. $8,000 worth of damages.

 

[Kryton619]

The Residential Tenancies Act here is unbelievable. The hoops that you have to go through to collect for non payment of rent is crazy combined with the fact that it takes so long to get a hearing. All the while the tenant is in your apartment using your utilities and not paying rent. You get an eviction order at the hearing and the adjudicator gives the tenant another 2 weeks to pay, they don't, and then it takes sometimes 3 weeks to get the sheriff to evict.

The tenant gets evicted, has lost their job, and takes off.....good luck ever getting your money.

It is getting very close to sell time for me.