Retirement Planning - Lessons Learned

Snobdds

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I don't agree with this reasoning, and this is why. I'm sure you're familiar with inflation calculators. Here's one:


It's simple to use, simply enter the $ amount and year. It tells you in today's dollars what that equals. Now, when I bought my place in 1980 my 30 year mortgage rate was 14%. At that time I was making $3.50/hr. or $11.60/hr. today. I worked my behind off and paid mortgage off in 3 years.
I just now fooled around with the calculator a bit as well as looking at homes for sale in my area. First I compared what I paid back then to today, comparing similar home+land.
That was easy, and found similar ones for comparison.
Then I tried a different way. Knowing what my payments were then the inflation calculator showed me what that would be today. Taking THAT figure at today's low mortgage rates how much home could I buy for THAT dollar amount.
I was shocked beyond belief. With that same equivalent amount I was paying back then, today I could buy not twice but about three times the place I bought in 1980.
Granted, and this is beside the point, over the years I doubled size of home, had a large garage and horse stable built, bought land, etc.
The point is all things equal, employment opportunities are everywhere. Every business around here has help wanted signs. Right now wife & I are taking horse riding lessons. The instructor comes here, he's in his late 50s, yesterday he said his is a dying breed. Younger generation doesn't want to get in to doing that, so no one to carry on.
Baby boomers (I'm 69 and wife & I are) worked hard. Our parents and grandparents worked even harder (the Greatest Generation). Make no mistake...successful baby boomers had nothing handed to them and like our parents and grandparents worked hard for what we have.

Trying to calculate nominal value at points in time is missing the point of interest rate movement and prices.

Don't try and outthink economic principles.
 

goeduck

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Watching the movie reminded me how it seems that immigrants who come to our county who have nothing, actually realize what it means to work to be paid, work hard, and try to better yourself. Say what you will about immigrants today, but from my own peresonal experience, they seem to work just as hard as most "hardworking Americans" I know.
Maybe a new concept would be for every immigrant we take in we emigrant a drug addict. That would improve things.
 

goeduck

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This will kill a retiree's retirement planning pretty quick if interest rates do not follow along...

E-xMC-VXEAI-3cM
sobering thought
 

Sigarms

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Talk about real life supply and demand...

You guys wouldn't believe what kind of long lasting effect that deep freeze in Houston has had in the HVAC industry with supply, demand and pricing.

Looking at flex manufacturing for new construction and commercial projects, and flex is hard to come by. Talked with one manufacturer, and where they once had 24 production lines running two shifts, now they're down to 11 lines running one shift a day because they're still waiting for the material to come in from Houston.

Never realized you need resin to manufacture flex duct, and the majority of that raw material came from Texas.

Been doing HVAC for close to 3 decades now, this is the first year I've seen 3 price increases from pretty much all the the HVAC manufacturers BEFORE the end of the summer of the year in question (and may have yet another before Winter). Major oil furnace manufacturer went up 22.5% in 3 months. Talking with mini split people, and now the issue is the docks in China and the price of shipping containers along with freight.

Sheet metal across the board probably around 45% up this year. PVC fittings, it's a question if you can get them, just like plastic pads.

I've never seen a year like this in my industry.

Starting to feel like I'm in the lumber market....
 

RickB

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Bond values and interest rates work in opposite directions. If interest rates go up, bond values will go down.

In today's world, there is no better place to put money than a low cost index fund.
That's a broad statement. Index funds are 'indexed' to a wide range of specific asset classes and markets and could be dependent on the ups and downs of whatever the fund is indexed to. Conventional wisdom links the term index fund to the S&P 500 which will skew the investor's dollars disproportionately towards the tech sector. Yes, I have that type of index fund, but far, far from exclusively. At this stage of my investment cycle I am equally interested in capital preservation as growth. Even if that were not true an S&P index lacks the true asset class diversity I require. My equity/fixed income tolerance is no more than 65%. The four taxable bond funds I hold in retirement accounts have outperformed any type of cash holding since day one and continue to do so. I believe a successful bond fund management team is key to successful bond investing.
Comparing an actively managed low cost bond fund to an investor watching a single bond purchase wither are two entirely different things.
10 and more years ago when I was in the accumulation phase I had exactly zero dollars in bonds of any type. Equities was king then. Now they share the stage.
 

Steppenwolfe

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I don't agree with this reasoning, and this is why. I'm sure you're familiar with inflation calculators. Here's one:


It's simple to use, simply enter the $ amount and year. It tells you in today's dollars what that equals. Now, when I bought my place in 1980 my 30 year mortgage rate was 14%. At that time I was making $3.50/hr. or $11.60/hr. today. I worked my behind off and paid mortgage off in 3 years.
I just now fooled around with the calculator a bit as well as looking at homes for sale in my area. First I compared what I paid back then to today, comparing similar home+land.
That was easy, and found similar ones for comparison.
Then I tried a different way. Knowing what my payments were then the inflation calculator showed me what that would be today. Taking THAT figure at today's low mortgage rates how much home could I buy for THAT dollar amount.
I was shocked beyond belief. With that same equivalent amount I was paying back then, today I could buy not twice but about three times the place I bought in 1980.
Granted, and this is beside the point, over the years I doubled size of home, had a large garage and horse stable built, bought land, etc.
The point is all things equal, employment opportunities are everywhere. Every business around here has help wanted signs. Right now wife & I are taking horse riding lessons. The instructor comes here, he's in his late 50s, yesterday he said his is a dying breed. Younger generation doesn't want to get in to doing that, so no one to carry on.
Baby boomers (I'm 69 and wife & I are) worked hard. Our parents and grandparents worked even harder (the Greatest Generation). Make no mistake...successful baby boomers had nothing handed to them and like our parents and grandparents worked hard for what we have.
F'n A right on that...
 
 
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