Investing for your Future
C Marlin
9 years ago
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9 years agolast modified: 9 years agoElmer J Fudd
9 years agolast modified: 9 years agoRelated Discussions
How to invest an inheritance
Comments (7)Hi Jockewing, Along with the others, my condolences for you & your family with your Grandmother's passing. Some basic rules of thumb for your financial management; A) "Reserves rule" and you want to initially have, at minimum, safe & liquid funds set aside in an account that cannot lose money to the markets, equal to no less than 6 months of your total costs of living (and preferrably 12 months,) B) I suggest your "longterm goal" to be to grow your investments to the eventual point where they can throw off enough passive cashflow (without eating into the principal) to cover 100% of your living expenses. This, of course, is the definition of "Financial Freedom." C) As long as your after-tax interest costs on leverage (loans, mortgage, etc.) remain less than your after-tax average rate of growth on investments, leave the leverage principal alone, and direct every additional discretionary dollar you can into your growth accounts. D) Yes, you will want to build a "risk/reward pyramid" distribution of your newly acquired assets to fit your stage and profile in life (which considers far more than merely your age... but family status & plans, career/educational status & plans, likely longevity (family history,) personal financial attitude, and other factors.) All of this, properly done, will likely require the oversight of a good planner... and even then you're going to see significant differences in planning styles, so its a good idea to take your time to interview various planners (and I suggest from various different "financial cultures." Talk with securities-oriented planners, insurance-oriented planners, legal/tax-oriented planners... get a rounded exposure.) REGARDING YOUR NEW 2nd HOME: Renting it out is more than simply "renting it out." It is more than simply "taking tax-advantaged cashflow" from your held appreciating asset. Doing so is a decision to enter into the business of being a landlord. It is crucial to understand the gravitas of this, as a decision. (Personally I love the business of being a landlord, for so MANY reasons... but as an Advisor myself, I know too many individuals who never realized it is a business, and have financially suffered because of that.) NOW... regarding cleaning up your credit. Contrary to the advice above, DO NOT try to go it via any generic "rules of thumb." You *DEFINITELY* want the guidance of someone who understands how to read the reason codes of your current tri-merge credit report, and translate them into priorities and actions to be applied. The people who can generally guide you on this the best are mortgage brokers (even if you are not going to do a refi.) The "clean your credit" businesses are more often than not a scam. Retail bank loan officers generally don't know or care about the intricacies of credit improvement. CFPs, CPAs, Attorneys, etc. are virtually *always* clueless about how the credit bureaus report their specifics, and how to use the reports as an action plan. Your standard individual Mortgage Broker will be far more likely to dig in & help you work through your plan (even if it takes 2, 3, even 6 months) to get your credit in shape to get a great refinance... and they'll usually do it for no charge (just your honor of doing your refinance with them when (and if) you actually refinance.) Kind of a service "loss leader" for them. To recap; RESERVES RULE! Everything else *AFTER* you've locked-out sufficient reserves. SAFETY FIRST! Get the "guaranteed money" foundation of your risk/reward pyramid in place #1. SHOP PROFESSIONALS (not investments.) Be sure to shop differing "financial cultures." Hope that's helpful! Dave Donhoff Leverage Planner...See MoreRemodeling project - process question
Comments (27)You guys are being very harsh. How about being more supportive? This is an expensive and very stressful process and not easy for newbies. Hope the following info helps: We did not have a great idea of remodeling costs either before talking with an architect and getting bids in. We had an idea of our max. budget and the architect drew up plans roughly corresponding to what he thought worked for our budget. Imp difference from your case, he put allowances in for the builders to use for estimating tile costs, appliance costs, and any owner variables. He also specified in detail what types of materials to use. Any builder questions were answered by the architect not us. The bids came in significantly higher than expected. However, we were able to pick a builder and then meet with him and the architect to reduce costs. Now the architect is drawing the final plans and the builder will then give us his revised bid. Your strategy seems similar but perhaps lacking in detail. Ask the architect to step in more perhaps....See MoreYour high school wishes for your future....
Comments (19)I recall that in my high school yearbook, under my photo, it listed my ambition and words I live by. The words I try to live by are the same now as they were then....He who is not actively kind, is cruel. by John Ruskin. My ambition was: to be happy. Kind of simplistic, but I am a simple person and I really do believe being happy is something we choose for ourselves, and even though I have had a lot of ups and downs in my life, I can truthfully say that I am very happy. Anyway, that is what I had posted in my yearbook, but as for my life's work....I hate to say that I didn't give it much thought. I wanted to raise horses. I did that. Wish I hadn't. I never wanted to get married and had no plans to have children. I did get married very early on, mainly because my mother wanted me to. She believed I should get married and believed a man should support me. So I got married and I played, and my husband supported me. I didn't have a baby until I was in my mid 30's and I have no regrets about waiting. I only think it made me (not speaking for anyone but myself, so don't jump on me) a better mother. In some ways, having a baby late, was sort of like having a baby and a grandbaby at the same time. I was more settled and secure in myself. I ended up taking care of my mother, who had dementia, until she died in her 90's and then I took care of an elderly former neighbor and friend for 8 years, until he died. I promised him I would, so he wouldn't have to go in a nursing home. I rehabbed wildlife...mainly because I felt sorry for the orphans, and I am good at raising babies of all kinds. (Despite not wanting children...I am extremely maternal.) Now I do anything I want to do. I have no grandchildren. My daughter is secure...doesn't need my help. I wanted a mule. I bought a green broke mule. I need to get used to riding again...so I bought a horse. I plan to raise a mule foal. I plan to start riding again and ride every day for the rest of my life...if at all possible. Gee....I think I forgot the question. I'm sorry. I am happy though....See MoreYou're a time traveler--would you go to the past or the future?
Comments (32)I would not want to go back and meet my ancestors, as I think that a lot of them were mean and cruel, at least from what I know about them. My father was bad enough, and he learned his cruel behavior from his male ancestors. His great-grandfather did free his slaves, however, and paid them wages instead of making them work for free. I never met my paternal grandfather, but my cousins told me that he was cruel, and some of my male cousins on that side of the family were also cruel. It seems that mainly the men were bad, but not all of them. If you go to the future by only a few years, or up to 100 years, things might be bleak, but if you go to the future 1000 years from now, things might have worked themselves out. I would want to travel to a time in the future when there are no more fundamentalist religions and no more religious conflicts or wars. I don't know how long it will take humans to learn to live peacefully, since wars have been prevalent as long as civilization has existed. I would like to go to a time in the future when greed would be a thing of the past....See Morejakkom
9 years agolast modified: 9 years agojunco East Georgia zone 8a
9 years agolast modified: 9 years agoElmer J Fudd
9 years agolast modified: 9 years agoC Marlin
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