When the time comes and one has to sell the house and move to a retirement community or nursing home it definitely comes in handy then for cash.
Retirement Targets
- Thread starter yowza
- Start date
Uhh...Cramer is not that bright. There is literally a twitter handle called inverse cramer and they track his calls from the show and stocks usually do the opposite of what he says and they have more success that way lol.
I'm all in on my HSA. I went through cancer treatment last year and I didn't even touch my HSA because I want it there when I retire early. With that said, I just recently learned that you cannot use HSA for insurance premiums. That was kind of surprising to me.
Yeah, I learned that about a year ago. Oh well, I was late to start an HSA so will probably end up using all of mine for actual qualified expenses (hopefully much later).
After 65 you can withdraw from your HSA without penalty, other than paying taxes on the distribution. It essentially becomes an IRA. Using it for qualified expenses will always be triple tax-deferred
But from what I understand you can use it to reimburse yourself for your Medicare premium but not the supplemental insurance
Everyone’s situation is different so if’s hard to generalize. However, below are some thoughts based on the information you provided.
Increase your savings rate to at least 20 percent of your gross income. This includes any employee match. Therefore, if your employer contributes 6%, you should save at least 14% on your own. This savings can, but doesn’t necessarily have to come from your 401K. There are other excellent vehicles such as HSA accounts, Roth IRAs, etc. The main thing is to save 20%. If it’s impossible to achieve this savings rate immediately, ramp it up over a series of years.
Don’t be afraid of stocks. They certainly can go down over 1-, 3-, or 5-years. However, over long periods of time, they are almost assured to increase in value. This is because the is a strong correlation between stock values and company earnings over the long run. For example, if the earnings of a basket of companies, such as the S&P 500, increase by 800 percent over a 30-year time frame, those companies stock prices will increase by about the same percentage. Investing in stocks over the long-term is not gambling. Rather, it’s a conviction that the economy and company profits will increase over a multi-year time frame. I would recommend having at least a 80/20 stock to bond mix for a person in your situation.
Invest in index funds or ETFs, like the S&P 500. In fact, if you want to keep it simple, that is probably the only fund you need for your stock investments. Alternatively, Vanguards Total Market ETF would be a good choice. The rock bottom expense ratio associated with index funds make it extremely difficult for active fund managers to beat over a long period of time. I didn’t believe this when I was in my 20s, but eventually came to this realization after many years of seeing my portfolio lag the S&P 500. Also, stay away from individual stocks as your picks are more than likely to underperform the general market. I had to learn this the hard way as well.
Lastly, don’t panic if your plan doesn’t pay immediate dividends (no pun intended). Preparing for retirement requires patience, convection, and commitment. Just like the fable, the tortoise wins the race, not the hare. Best of luck.
It's basically the same 4 guys who own the small business where we also work. We bought a bigger building and rent to ourselves! Not exactly real estate geniuses, to say the least.
As far as the interpersonal part, you are always going to have some friction points. Whether that is friends or family or just partners. One guy never knows what is going on, one guy says yes to anything, one guy can't let little things go... I think the real risk there is losing not just an investment, but also a person who you value in your life. It's not just money risk. And many people like to blame bad outcomes on someone else, and if that someone else is your BIL or old friend, that makes the holidays "special".
My advice would be 2 things BEFORE investing and signing anything:
1. Communicate excessively up front about what everyone's goals and wants are. If one guy wants cash flow, but another wants tax help, another just wants to be a silent partner, and another wants to renovate/upgrade... you will have a lot of conflict. If everyone has the same goal its a lot easier to make things happen and prevent unhappiness. Even if you have different goals, knowing that up front will allow you to deal with it openly (or decline to join).
2. Pay a lawyer to document a really well thought out operating agreement, based upon what you agree for terms of engagement - especially for buy/sell, who ultimately makes decisions, board vote %s required, etc. That way you know where you stand in case of conflict or change.
I suppose that would go for any business, not just real estate...
Good advice. I have never invested in real estate. Not because it’s not a good investment. Rather, I just don’t have the expertise. I would need to partner(s) who I could trust and knew what they were doing before jumping in. Having everyone on the same page before purchasing a property would be a must.
Hmmm, my wife is retiring and they are funding an HSA for her. I was told I could add her to my insurance and use her HSA to pay for the premiums. I already have a high deductible plan and contribute to my HSA. I better do some more checking.
I had always heard that if you have insurance through your employer or a source like that, then the premiums were not deductible if you have it on your own they are
The IRS publication seems fairly clear to me. Private insurance premium are never a qualified expense.
Medicare premiums, after you turn 65, are qualified expenses.
Step 1: start saving early in life
Step 2: dont get divorce
Step 3: no major health issues
Step 4: retire
Step 2: dont get divorce
Step 3: no major health issues
Step 4: retire
What on earth makes you think federal income tax will increase? The party with a built in electoral college advantage in the US excommunicates anyone who supports increased taxes.
I would bet heavily against income tax rate in retirement being higher than during working years for 99% of Americans.
Well the current tax cuts are set to expire in 2025 so..... Although I've heard only the rich got tax breaks so maybe everything will be ok for us 99%er's.
I know but he was in the biz a long time. I like all perspectives. And he gets the big time CEOs on his shows.
