Investment account back up!

California · Dec 20, 2023

re helping manage a relative's money, the smartest thing I ever did was get Dad's variety of investments moved into a single Fidelity master account. He had a whole bookcase of original stock certificates, dividend-reinvestment statements, elections of corporate directors, more. He paniced when he noticed he was no longer getting statements from the spun-off PacTel cellphone division. (Because that entity had been sold to Vodaphone). At age 85 he asked for my help to resolve this. I knew I would eventually be executor so I talked him into taking all his paperwork to Fidelity to figure out. This put everything on a single monthly summary statement. A few years later, settling the financial part of his estate was simple.

California · Dec 20, 2023

As for Investment Account Back Up:

We live fairly simply on SS and pensions - which include lifetime medical plan. No debt. So the IRA's and taxable investments we put away years ago for retirement aren't critical. We've mostly left the accounts alone, with now sharing much of the RMD's with our kids who are raising their own kids.

But it has been 'interesting' to watch portfolio value zig-zag $100k below, then $100k above, the recent average. I just looked at S&P which our returns approximately track: Up 3% over 2 years, up 25% year to date, up 67% over 5 years. Looks like there will be something left for the kids, eventually. It would have made me crazy to try and time the recent market. Just staying the course has worked out better and with no stress.

As I've noted in other posts, 85% of retail investors don't do as well as the S&P. So S&P mutual funds are where most of our retirement savings have been invested.

RSKY · Dec 21, 2023

bdhsfz6 said:
A lot of good information here. One thing I'd like to add is this:

For those, including myself, who are living on investments with no other source of income, there is a principal "threshold" to consider.

When there is a dip in the market, as in 2008, there is a minimum level of principal required to allow for a successful portfolio recovery. During the dip, or recession, you still need living expenses, which can further erode that principal.
This threshold is difficult to determine and follows in the footsteps of that age old question, "How much do I need in retirement?" Sometimes adjustments to withdrawals or investment direction is necessary and requires sound advice from a qualified investment councilor.

If your investments are what you live on then your attitude and strategy towards the market will be different than mine. I look upon mine as generational wealth to be passed on and as a source for big item purchases like autos. Other than that we keep enough in checking to handle day to day with a month or so's reserve. Not that we are wealthy or anything, just that we worked hard and saved all our lives to be in this position. We never partied, didn't trade vehicles every other year, and seldom splurged on expensive items. So now we sit back and enjoy life while some of our contemporaries who partied all the time and bought expensive junk are still working at age 70.

RSKY

ultrarunner · Dec 21, 2023

RSKY said:
If your investments are what you live on then your attitude and strategy towards the market will be different than mine. I look upon mine as generational wealth to be passed on and as a source for big item purchases like autos. Other than that we keep enough in checking to handle day to day with a month or so's reserve. Not that we are wealthy or anything, just that we worked hard and saved all our lives to be in this position. We never partied, didn't trade vehicles every other year, and seldom splurged on expensive items. So now we sit back and enjoy life while some of our contemporaries who partied all the time and both expensive junk are still working at age 70.

RSKY

Some keep working well beyond out of a sense of duty…

My step grandfather was the first every morning and last to leave his Tool and Die shop well into his 80’s.

He said I have men with families that depend on me.

He emigrated to the United States in the 1920’s as a master Tool Maker.

He never accepted social security saying America provided opportunities beyond his wildest dreams…

It’s all gone now but an interesting prospective that seems to be disappearing.

MoKelly · Dec 21, 2023

ultrarunner said:
Some keep working well beyond out of a sense of duty…

My step grandfather was the first every morning and last to leave his Tool and Die shop well into his 80’s.

He said I have men with families that depend on me.

He emigrated to the United States in the 1920’s as a master Tool Maker.

He never accepted social security saying America provided opportunities beyond his wildest dreams…

It’s all gone now but an interesting prospective that seems to be disappearing.

Interesting.

By never accepting social security does that mean he never applied?

Just think how the USA would be doing today if everyone had the work ethic of your grandfather!

CloverKnollFarms · Dec 21, 2023

Well, SS is my money, so yah... I'm going to get a bit of it back. The value of what I paid in, would be worth more than $1m at age 62... Accounting for no growth after that... I still wont see those dollars in my lifetime.

Especially since the average life expectancy in the US has dropped by 3 full years, in just three years. Odd eh?

. Insurance companies have some startling facts about our longevity right now.

Torvy · Dec 21, 2023

That money would be worth so much more if the government simply required you to put the same % in a 401k type system...but then they couldn't use it for control.

SS is unsustainable, especially since populations are declining.

California · Dec 21, 2023

SS runs on the model of the present working generation, provides the funds for the entitlements of the presently retired.

MoKelly · Dec 21, 2023

CloverKnollFarms said:
Well, SS is my money, so yah... I'm going to get a bit of it back. The value of what I paid in, would be worth more than $1m at age 62... Accounting for no growth after that... I still wont see those dollars in my lifetime.

Especially since the average life expectancy in the US has dropped by 3 full years, in just three years. Odd eh? . Insurance companies have some startling facts about our longevity right now.

The gross value of what I paid plus what my employer matched is close to $3 million.

My benefit is roughly $40000/year.

As someone said, if those monies were placed in a ROTH the value at retirement would be amazing!!!

Don’t get me started on the 1.5% Medicare tax.

CloverKnollFarms · Dec 21, 2023

It's not an entitlement. It's the ****tiest retirement account you could pay into bar none. When I pay I into it, more than I'll see, it's robbery. Especially considering it's a slush fund for govt spending.

MoKelly · Dec 21, 2023

CloverKnollFarms said:
It's not an entitlement. It's the ****tiest retirement account you could pay into bar none. When I pay I into it, more than I'll see, it's robbery. Especially considering it's a slush fund for govt spending.

I do not disagree.

In my opinion, it is the classic govt big brother thought process —- 1. people are too dumb to save for themselves 2. We need to help them to avoid disaster in the future 3. We will force them (and their employer) to put money in by required payroll withholding 4. They are too dumb to invest for themselves so we won’t let them have any control 5. We will control everything up to and including how much they get based on when they retire and, of course, we will tax the money as it’s earned and when it’s paid and, what the heck, we will take out Medicare premiums.

We really won’t invest the money but rather fund the deficits by selling Govt bonds. Nevertheless, we will call it the Medicare Trust Fund.

MossRoad · Dec 21, 2023

Personally, I'd like to see the top limit taken off on social security so everyone has to pay the same percentage no matter how much they make over the current $160K'ish. A flat tax, so to speak.

MossRoad · Dec 21, 2023

MoKelly said:
I do not disagree.

In my opinion, it is the classic govt big brother thought process —- 1. people are too dumb to save for themselves 2. We need to help them to avoid disaster in the future 3. We will force them (and their employer) to put money in by required payroll withholding 4. They are too dumb to invest for themselves so we won’t let them have any control 5. We will control everything up to and including how much they get based on when they retire and, of course, we will tax the money as it’s earned and when it’s paid and, what the heck, we will take out Medicare premiums.

We really won’t invest the money but rather fund the deficits by selling Govt bonds. Nevertheless, we will call it the Medicare Trust Fund.

I'd have loved to have been able to invest my SS money myself. Would have come out WAY ahead!

Reality says there will always be people that can't (or won't) take care of themselves financially. We all know many folks that could not handle it for various reasons. Impulses. Common sense. Gullibility. stuff like that.

So what happens to them when they didn't (or couldn't) save anything for retirement?

CloverKnollFarms · Dec 21, 2023

MossRoad said:
Personally, I'd like to see the top limit taken off on social security so everyone has to pay the same percentage no matter how much they make over the current $160K'ish. A flat tax, so to speak.

Not me... I look forward to 5 months of the year without that highway robbery.

CloverKnollFarms · Dec 21, 2023

People never survived prior to SS?

California · Dec 21, 2023

CloverKnollFarms said:
People never survived prior to SS?

Ever read The Grapes Of Wrath?

jyoutz · Dec 21, 2023

CloverKnollFarms said:
People never survived prior to SS?

It was normal prior to SS for extended family living arrangements. When grandpa got too old to work he moved in with the kids.

Torvy · Dec 21, 2023

California said:
Ever read The Grapes Of Wrath?

Just watched the movie...

Torvy · Dec 21, 2023

jyoutz said:
It was normal prior to SS for extended family living arrangements. When grandpa got too old to work he moved in with the kids.

Also, before 1945 or so, the life expectancy was under 65. The US model their system after the German system. If half of the people died before reaching full retirement age, the nation kept most of the remaining money.