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Author Topic: $2M Retirement.  (Read 5182 times)

Offline C.Cash

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$2M Retirement.
« on: January 20, 2010, 02:38:56 pm »
Could you retire with $2M ?

How would you do it?

How could you stretch $2M for the next 35-40 years and live comfortable?

Would you retire, semi retire or continue to work?

Thanks.
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Offline ssltech

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Re: $2M Retirement.
« Reply #1 on: January 20, 2010, 04:36:55 pm »
Retirement...

-Whaaaaa.....?

What I do now feels so much like a hobby, I don't know if I could retire.

Keith
MDM (maxdimario) wrote on Fri, 16 November 2007 21:36

I have the feeling that I have more experience in my little finger than you do in your whole body about audio electronics..

Offline PookyNMR

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Re: $2M Retirement.
« Reply #2 on: January 20, 2010, 07:20:58 pm »
C.Cash wrote on Wed, 20 January 2010 12:38

Could you retire with $2M ?

How would you do it?

How could you stretch $2M for the next 35-40 years and live comfortable?

Would you retire, semi retire or continue to work?


I wouldn't retire.  Just take more vacations.  Longer vacations.  

And I'd only do work that I'd enjoy.  I'd also volunteer a lot more to help those who are less fortunate.

I'd be confident I could easily have that $2M last.  I have two family members in the finance investment business with an amazing track record on returns.
Nathan Rousu

Offline compasspnt

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Re: $2M Retirement.
« Reply #3 on: January 20, 2010, 09:22:03 pm »
$2M today is not near as much as it used to be.

Offline el duderino

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Re: $2M Retirement.
« Reply #4 on: January 20, 2010, 11:10:17 pm »
if you could find a bank that would give you a 5% interest rate, you'd be earning 100k a year just in interest.


Offline rollmottle

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Re: $2M Retirement.
« Reply #5 on: January 20, 2010, 11:22:44 pm »
el duderino wrote on Wed, 20 January 2010 20:10

if you could find a bank that would give you a 5% interest rate, you'd be earning 100k a year just in interest.




Good luck with that these days.

I got an ING offer the other day trying to lure me with a WHOPPING 1.25%...
SENTRALL Sound East
My SoundCloud | Twitter | www.sentrall.com

Offline Barry Hufker

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Re: $2M Retirement.
« Reply #6 on: January 20, 2010, 11:46:49 pm »
There is a very good rate right now with tax-free bonds, which when compared to savings CDs comes out to an interest rate of 7%.

But 2 mill no longer makes you a millionaire.  I figure you need at least 10 mill to make you that.

Barry

Offline Paul Cavins

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Re: $2M Retirement.
« Reply #7 on: January 21, 2010, 12:27:40 am »
Tell you what-

Give me $2M and I'll let you know how it turns out-


PC

Offline Taproot

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Re: $2M Retirement.
« Reply #8 on: January 21, 2010, 09:09:09 am »
Mutual funds, mutual funds and mutual funds.  Smile
Jeffrey Reed
Taproot Audio Design
Oxford, Mississippi
www.taprootaudiodesign.com
www.myspace.com/taprootaudio

"That boy's so dumb, he thinks the Mexican border pays rent!" -Foghorn Leghorn

Offline Roadster

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Re: $2M Retirement.
« Reply #9 on: January 21, 2010, 10:40:50 am »
If we had some ham we could have some ham and eggs....
if we had some eggs.
Rich
Road's End Studio
Musician, Songwriter, Research Technician on Creative Muse

Offline el duderino

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Re: $2M Retirement.
« Reply #10 on: January 21, 2010, 10:45:06 am »
rollmottle wrote on Wed, 20 January 2010 23:22

el duderino wrote on Wed, 20 January 2010 20:10

if you could find a bank that would give you a 5% interest rate, you'd be earning 100k a year just in interest.




Good luck with that these days.

I got an ING offer the other day trying to lure me with a WHOPPING 1.25%...



true, however banks will up your rate when you put in large sums of money. i get the same ING offers. im guessing that you, like me, do not have 2 mil to stick in their bank. when you walk into a bank and inquire about what they can do for you with that much money, you don't get the same thing everyone else gets.

Offline PookyNMR

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Re: $2M Retirement.
« Reply #11 on: January 21, 2010, 11:37:48 am »
el duderino wrote on Wed, 20 January 2010 21:10

if you could find a bank that would give you a 5% interest rate, you'd be earning 100k a year just in interest.


Or you could find a portfolio manager with an excellent track record.  In a reasonable economy 5% is no problem.
Nathan Rousu

Offline Roadster

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Re: $2M Retirement.
« Reply #12 on: January 21, 2010, 01:20:46 pm »
There is no such thing as a money "manager".

You would do as well getting a book from the library.
Rich
Road's End Studio
Musician, Songwriter, Research Technician on Creative Muse

Offline ssltech

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Re: $2M Retirement.
« Reply #13 on: January 21, 2010, 01:22:45 pm »
To everyone who insists that no amount of money -however enormous- can make you happy, I beg the following:

...just give me a chance to prove myself wrong!

Laughing
MDM (maxdimario) wrote on Fri, 16 November 2007 21:36

I have the feeling that I have more experience in my little finger than you do in your whole body about audio electronics..

Offline KB_S1

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Re: $2M Retirement.
« Reply #14 on: January 21, 2010, 02:20:16 pm »
ssltech wrote on Thu, 21 January 2010 18:22

To everyone who insists that no amount of money -however enormous- can make you happy, I beg the following:

...just give me a chance to prove myself wrong!

Laughing


Money can't buy you happiness.
But poverty is even less likely too.
<a href="http://www.parklanerecordingstudios.com/" class="link3">Park Lane Studio</a> Where to find me most of the time<br /><br />

<a href="http://www.flickr.com/photos/kb_s1/" class="link3">Flickr</a>where to see what I have been up to  <br /><br />

Offline Jon Hodgson

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Re: $2M Retirement.
« Reply #15 on: January 21, 2010, 02:59:42 pm »
KB_S1 wrote on Thu, 21 January 2010 19:20

ssltech wrote on Thu, 21 January 2010 18:22

To everyone who insists that no amount of money -however enormous- can make you happy, I beg the following:

...just give me a chance to prove myself wrong!

Laughing


Money can't buy you happiness.
But poverty is even less likely too.



Misery is always available free of charge.

Happiness not so.

Offline C.Cash

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Re: $2M Retirement.
« Reply #16 on: January 21, 2010, 03:19:35 pm »
Just suppose you worked 30+ years at a job that payed well but you hated. No kids but have a wife. House payed for and owed no money and came upon $2M.

What would you do?
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Offline DarinK

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Re: $2M Retirement.
« Reply #17 on: January 21, 2010, 03:22:52 pm »
2 million divided by 40 years equals $50k per year, which is a totally decent income in most parts of the world.  It's more than I've ever made.  You'd have to invest to keep up with inflation, which even a low-rate savings account will do.  Anything else would be a bonus, and it should be very easy to earn beyond that even with very safe investments.
I'd keep working, but, as someone else said, only do work that I enjoy.
-Darin

Offline Berolzheimer

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Re: $2M Retirement.
« Reply #18 on: January 22, 2010, 02:32:43 am »
Congratulations, Clifford!
The film sound side of my life:
http://www.imdb.com/name/nm0077235/

A bunch of songs I've recorded and/or mixed are here:
http://www.zget.me/billionaires/

Offline Geoff Emerick de Fake

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Re: $2M Retirement.
« Reply #19 on: January 22, 2010, 06:28:52 am »
C.Cash wrote on Thu, 21 January 2010 14:19

Just suppose you worked 30+ years at a job that payed well but you hated. No kids but have a wife. House payed for and owed no money and came upon $2M.

What would you do?
Well, that's just about what happened to me in 1997, when I sold my company, except that I loved my job, that I didn't quit, I just relaxed and started playing live and writing songs again after a 15 years hiatus. I was very reasonable, didn't buy Ferrari's or Les Paul's (well, some, but not the then outrageously priced 'bursts). I put most of my money in funds, and now, after making another additional two million between 1997 and 2002, the banks and funds have left me with less than half of it. I wished I'd bought Ferrari's and Les Paul's...I still love playing and writing songs.

Offline Jon Hodgson

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Re: $2M Retirement.
« Reply #20 on: January 22, 2010, 07:11:40 am »
C.Cash wrote on Thu, 21 January 2010 20:19

Just suppose you worked 30+ years at a job that payed well but you hated. No kids but have a wife. House payed for and owed no money and came upon $2M.

What would you do?


Well it depends on the lifestyle you're used to, but if it wasn't too extravagent then I would say that a person in this situation would be in a good position to

a) Set themselves up debt free wherever in the world they wanted to live
b) Set up a combination of funds and other investments that would give them a living income (especially if they moved somewhere warm and cheap!)

I think I'd do that, and then keep working, except I'd do what work I wanted to do, when I wanted to do it, and know that every penny was disposable on having fun.

(Lookibg at where you live, if it's you, then no need to move anywhere warmer Smile )

Offline PookyNMR

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Re: $2M Retirement.
« Reply #21 on: January 22, 2010, 11:54:01 am »
Roadster wrote on Thu, 21 January 2010 11:20

There is no such thing as a money "manager".

You would do as well getting a book from the library.



??

I'm sorry, but that's pure foolishness.

Do have any idea how much training and education a fully accredited portfolio manager has?

This isn't something you can master by reading one little book from the library.  The technical term for that suggestion is "gambling".



Nathan Rousu

Offline Roadster

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Re: $2M Retirement.
« Reply #22 on: January 22, 2010, 01:50:08 pm »
PookyNMR wrote on Fri, 22 January 2010 10:54

Roadster wrote on Thu, 21 January 2010 11:20

There is no such thing as a money "manager".

You would do as well getting a book from the library.



??

I'm sorry, but that's pure foolishness.

Do have any idea how much training and education a fully accredited portfolio manager has?

This isn't something you can master by reading one little book from the library.  The technical term for that suggestion is "gambling".






Two books then. OK, one if you live in Canada.

Seriously, I know they have enough training and education to bring the economy to it's knees.  Rolling Eyes
Rich
Road's End Studio
Musician, Songwriter, Research Technician on Creative Muse

Offline Les Ismore

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Re: $2M Retirement.
« Reply #23 on: January 23, 2010, 07:20:27 pm »
Definition of a money manager:

Someone who manages your money until it's all gone.

If I lose or blow my own money, that's one thing. The thought of someone else blowing my money for me rubs me the wrong way.

Back in the 90s I came into a settlement on a car accident and everyone told me "mutual funds, we made 20% last year". If I had bought into them I would have lost 50% of the dough that year.

I ended up spending that money myself and got much pleasure out of it. The stock market is designed to re-distribute wealth. From you to them. And it does it very well.

If I had 2 million, and was going to try to live on it without other income, I would invest very wisely in some real estate that was low, but sure to increase in value. And close enough that I could manage it.

Congratulations and good luck!
Pete Honychurch - Fluid Sound
http://www.myspace.com/PeteHonychurch

Offline seedyunderbelly.com

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Re: $2M Retirement.
« Reply #24 on: January 23, 2010, 10:46:54 pm »
There is a way to do it,

You have to set up a situation so your 2 mil continues to GROW  not stay the  same  not get slightly eaten--   So this can be accomplished by doing two things -  

 Perhaps you do not have to work the same undesirerable job  but having SOME income  would be worth it just so you do not go backward-   The other thing is   as pointed out earlier  you have to manage expenses carefully if you want it to get you all the way through

For example,  

You could move to the Phillipines*(or the like)  where you can afford to live cheap  develop some idea to keep $ coming in -  Have your investments  in Dollars/Euros/Gold etc.  whatever you know and are comfortable with  and  Out run the world while you are essentially  retirded  but still doing something to keep you from going backwards....  There are a million ways to skin a cat  but   that conservative plan would increase the longevity of the bread-   I would seriously think of multiple currencies

You could always move to Alabama! ha
How would Mexico  I really do not know    but you get the idea your $ world in the western world  you expenses are third world  and you are still Increasing your kitty  for another 15 or so years   and with all that time on your hands  you Should be able to make something  happen--  Good luck  

 If you have any impressions or improvements please let me know We are all doing our own version of this regardless of spectrum!  xj













Offline NelsonL

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Re: $2M Retirement.
« Reply #25 on: January 24, 2010, 03:51:08 am »
Several years ago, when I had a day job and a 401-k, I read a finance book that said, essentially, that index funds tend to outperform managed funds in the long run, and typically charge lower fees.

Here's an article that says something similar:

  http://www.fool.com/investing/mutual-funds/2009/02/25/index- funds-are-hard-to-beat.aspx

They're (obviously) still affected adversely by the recession, but then, so is pretty much everything else.

The question right now is whether or not we're headed for a double dip.

Anyway, you'd have to assess your own appetite for risk. With that kind of capital, you could generate a decent amount of income just on certified deposits alone.

Offline Tomas Danko

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Re: $2M Retirement.
« Reply #26 on: January 24, 2010, 07:08:36 am »
You could move to Goa and stop working for the rest of your life. In fact, you don't need nearly as much money in order to do so.
http://www.danko.se/site-design/dankologo4s.gif
"T(Z)= (n1+n2*Z^-1+n2*Z^-2)/(1+d1*z^-1+d2*z^-2)" - Mr. Dan Lavry
"Shaw baa laa raaw, sidle' yaa doot in dee splaa" . Mr Shooby Taylor

Offline compasspnt

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Re: $2M Retirement.
« Reply #27 on: January 24, 2010, 10:19:23 am »
Goa looks pretty interesting.

Why do you mention it...or rather, what do you know about the cost of living there?

http://en.wikipedia.org/wiki/Goa

Offline NelsonL

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Re: $2M Retirement.
« Reply #28 on: January 24, 2010, 01:03:13 pm »
I was just in Kochi for a week, I think it's around 8 to 10 hours south of Goa, so I would assume it's not that different-- the expat community isn't as large though. It's also on the water, and is very lush and tropical. We never actually made it to the beach though.

Kochi has a very relaxed pace, except perhaps behind the wheel. People are very warm and smile right back at you, the food is wonderful (if you like vegetarian Indian fare, plus there's plenty of fresh fish) and there's a western style cafe in town that makes great cakes, coffee, and chai.

We were there visiting a friend who has retired there under circumstances not unlike those suggested by this thread.

Cost of living is very favorable in Kochi, at least as a guest eating out and taking taxis etc. Land and labor are affordable as I understand it-- our friend (Fletcher, oddly enough) built a beautiful home there with a lot of handcrafted, very ornate wood work.

I'd go back in a heart beat.


Offline Strummer

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Re: $2M Retirement.
« Reply #29 on: January 24, 2010, 05:13:58 pm »
compasspnt wrote on Sun, 24 January 2010 10:19

Goa looks pretty interesting.

Why do you mention it...or rather, what do you know about the cost of living there?

http://en.wikipedia.org/wiki/Goa



This guy appears to know a bit

http://www.nomad4ever.com/2008/12/01/cost-of-living-chart-go a-india-in-rupees-dollar-and-euro/

Offline eightyeightkeys

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Re: $2M Retirement.
« Reply #30 on: January 24, 2010, 06:41:00 pm »
PookyNMR wrote on Fri, 22 January 2010 11:54

Roadster wrote on Thu, 21 January 2010 11:20

There is no such thing as a money "manager".

You would do as well getting a book from the library.



??

I'm sorry, but that's pure foolishness.

Do have any idea how much training and education a fully accredited portfolio manager has?

This isn't something you can master by reading one little book from the library.  The technical term for that suggestion is "gambling".




There was an interview on CBC radio last year with a money manager expert/researcher.

This money manager did research on the returns of mutual funds versus GIC's over the past 50 years ! Which would you say was the better investment ?
Dave T.
D&D Music

Offline PookyNMR

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Re: $2M Retirement.
« Reply #31 on: January 24, 2010, 09:13:46 pm »
eightyeightkeys wrote on Sun, 24 January 2010 16:41

PookyNMR wrote on Fri, 22 January 2010 11:54

Roadster wrote on Thu, 21 January 2010 11:20

There is no such thing as a money "manager".

You would do as well getting a book from the library.



??

I'm sorry, but that's pure foolishness.

Do have any idea how much training and education a fully accredited portfolio manager has?

This isn't something you can master by reading one little book from the library.  The technical term for that suggestion is "gambling".




There was an interview on CBC radio last year with a money manager expert/researcher.

This money manager did research on the returns of mutual funds versus GIC's over the past 50 years ! Which would you say was the better investment ?



That would completely depend on your goals as an investor, your risk management levels, the term of investment, and so many other factors.

If you look at just the final average number you'll ignore other critical factors that could make either a better move given the situation.

Both tools exist because each offers a particular advantage to a certain set of situations.

All of this serves to show why a good, qualified portfolio manager is necessary.
Nathan Rousu

Offline seedyunderbelly.com

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Re: $2M Retirement.
« Reply #32 on: January 25, 2010, 07:17:26 am »
Looks Like Cliff is gonna have to go to Goa,

He can get his Brazillian Wax'd there for $14

~~ as opposed to the $41 dollars in The Phillipines....!

  Eggs were way cheaper in Goa too!

 I was surprised how similar the prices were for some of the other things..    

So Clifford,   The real question is what ethnicity do you like your Mistresses and Lady Boys?

Or Starve early in America or Bahamas!!!
j/k

You did get some killer advice here though!  

Wax on Wax off!

J


Offline Tomas Danko

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Re: $2M Retirement.
« Reply #33 on: January 25, 2010, 09:19:41 am »
compasspnt wrote on Sun, 24 January 2010 15:19

Goa looks pretty interesting.

Why do you mention it...or rather, what do you know about the cost of living there?

http://en.wikipedia.org/wiki/Goa



I once had the idea that instead of trying to create some music while working as a sales clerc or similar meanwhile (and cope with the wet slush and darkness during winter here in Scandinavia), it might be better to work hard for a while and save up money, and then stay in Goa for a year or two and focus on writing.

I've been advocating this for years to anyone who wanted to write a book, an album or paint etc.

Ten years ago I know you could live a decent life there for around $4000 per year. Even if it's gotten more expensive nowadays it's still very cheap to get an apartment or small hut as well as buying groceries and eating in taverns etc.
http://www.danko.se/site-design/dankologo4s.gif
"T(Z)= (n1+n2*Z^-1+n2*Z^-2)/(1+d1*z^-1+d2*z^-2)" - Mr. Dan Lavry
"Shaw baa laa raaw, sidle' yaa doot in dee splaa" . Mr Shooby Taylor

Offline Jon Hodgson

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Re: $2M Retirement.
« Reply #34 on: January 25, 2010, 09:42:39 am »
Tomas Danko wrote on Mon, 25 January 2010 14:19

compasspnt wrote on Sun, 24 January 2010 15:19

Goa looks pretty interesting.

Why do you mention it...or rather, what do you know about the cost of living there?

http://en.wikipedia.org/wiki/Goa



I once had the idea that instead of trying to create some music while working as a sales clerc or similar meanwhile (and cope with the wet slush and darkness during winter here in Scandinavia), it might be better to work hard for a while and save up money, and then stay in Goa for a year or two and focus on writing.

I've been advocating this for years to anyone who wanted to write a book, an album or paint etc.

Ten years ago I know you could live a decent life there for around $4000 per year. Even if it's gotten more expensive nowadays it's still very cheap to get an apartment or small hut as well as buying groceries and eating in taverns etc.


Around that time, perhaps a couple of years earlier, someone I knew went there for a short holiday. He said he met a number of people who had flats in London that they rented out for about 100 pounds a week more than their mortgage payments... and they'd found they could live ok in Goa for as little as fifty pounds a week, if they were happy to live a simple life.. "enough food to eat, a bit of beer, a bit of blow, sit on the beach reading a book" was how it was described to me.



Offline Tomas Danko

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Re: $2M Retirement.
« Reply #35 on: January 25, 2010, 09:47:15 am »
Jon Hodgson wrote on Mon, 25 January 2010 14:42

Tomas Danko wrote on Mon, 25 January 2010 14:19

compasspnt wrote on Sun, 24 January 2010 15:19

Goa looks pretty interesting.

Why do you mention it...or rather, what do you know about the cost of living there?

http://en.wikipedia.org/wiki/Goa



I once had the idea that instead of trying to create some music while working as a sales clerc or similar meanwhile (and cope with the wet slush and darkness during winter here in Scandinavia), it might be better to work hard for a while and save up money, and then stay in Goa for a year or two and focus on writing.

I've been advocating this for years to anyone who wanted to write a book, an album or paint etc.

Ten years ago I know you could live a decent life there for around $4000 per year. Even if it's gotten more expensive nowadays it's still very cheap to get an apartment or small hut as well as buying groceries and eating in taverns etc.


Around that time, perhaps a couple of years earlier, someone I knew went there for a short holiday. He said he met a number of people who had flats in London that they rented out for about 100 pounds a week more than their mortgage payments... and they'd found they could live ok in Goa for as little as fifty pounds a week, if they were happy to live a simple life.. "enough food to eat, a bit of beer, a bit of blow, sit on the beach reading a book" was how it was described to me.





Now there's an idea. Smile

Just remember to pack a laptop, midi keyboard, microphone and headphones...
http://www.danko.se/site-design/dankologo4s.gif
"T(Z)= (n1+n2*Z^-1+n2*Z^-2)/(1+d1*z^-1+d2*z^-2)" - Mr. Dan Lavry
"Shaw baa laa raaw, sidle' yaa doot in dee splaa" . Mr Shooby Taylor

Offline ssltech

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Re: $2M Retirement.
« Reply #36 on: January 25, 2010, 10:11:18 am »
Hmmmmmmmm...

"Goa".

Whos wife are we talking about?

http://www.youtube.com/watch?v=ona-RhLfRfc

Very Happy

Keef
MDM (maxdimario) wrote on Fri, 16 November 2007 21:36

I have the feeling that I have more experience in my little finger than you do in your whole body about audio electronics..

Offline PookyNMR

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Re: $2M Retirement.
« Reply #37 on: January 25, 2010, 12:53:39 pm »
Les Ismore wrote on Sat, 23 January 2010 17:20

Back in the 90s I came into a settlement on a car accident and everyone told me "mutual funds, we made 20% last year". If I had bought into them I would have lost 50% of the dough that year.


That's exactly why you need a qualified portfolio manager.  You'd bypass the 'sheep' mentality and have someone who's on top of it all provide solutions that will give reasonable growth and avoid crap funds and foolish investments.
Nathan Rousu

Offline Geoff Emerick de Fake

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Re: $2M Retirement.
« Reply #38 on: January 28, 2010, 01:43:07 pm »
Well I had two supposedly "qualified portfolio managers". None of them saw the burst of the internet bubble in 2000, neither the sub-prime crisis...
My two partners, who were in the same situation than me, proceeded differently: one invested in real-estate, now he's stuck with over-evaluated assets that he can't hardly sell, the other decided to be his own fortfolio manager, bought the books and software, and learnt. He really managed well the 2000 crisis, but not this one.
Problem is, nobody REALLY saw it coming. The supposedly best analysts in the world have been all taken by surprise. That's because these guys use tools that are suitable for an economic model that doesn't exist anymore.
I don't want to pay someone for making the mistakes that I'm perfectly capable of doing myself.

Offline PookyNMR

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Re: $2M Retirement.
« Reply #39 on: January 28, 2010, 10:21:27 pm »
Geoff Emerick de Fake wrote on Thu, 28 January 2010 11:43

Well I had two supposedly "qualified portfolio managers". None of them saw the burst of the internet bubble in 2000


To quote an old movie - "You have chosen poorly..."

Geoff Emerick de Fake wrote on Thu, 28 January 2010 11:43

Problem is, nobody REALLY saw it coming. The supposedly best analysts in the world have been all taken by surprise.


That's not true.  There's video documentation of plenty of folks predicting this last crisis years ago with uncanny accuracy.  

The problem is no one listened and wrote them off.  There was too much money to be made trying to continue riding the bubble.

With such bad policies and practices leading up to the event, I don't understand how more people didn't see it.

Opt-A loans are coming up in 2011.  Be prepared for another rough ride.  
Nathan Rousu

Offline Geoff Emerick de Fake

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Re: $2M Retirement.
« Reply #40 on: January 29, 2010, 09:21:16 am »
PookyNMR wrote on Thu, 28 January 2010 21:21

Geoff Emerick de Fake wrote on Thu, 28 January 2010 11:43

Well I had two supposedly "qualified portfolio managers". None of them saw the burst of the internet bubble in 2000
To quote an old movie - "You have chosen poorly..."
Yes, as thousands of others. How can one tell who is good, who is bad? And don't tell me that checking the past performance is key. Many analysts with a good historic record have stumbled on this one.
Quote:

 
Geoff Emerick de Fake wrote on Thu, 28 January 2010 11:43

Problem is, nobody REALLY saw it coming. The supposedly best analysts in the world have been all taken by surprise.
That's not true.  There's video documentation of plenty of folks predicting this last crisis years ago with uncanny accuracy.  
The problem is no one listened and wrote them off.  There was too much money to be made trying to continue riding the bubble.
With such bad policies and practices leading up to the event, I don't understand how more people didn't see it.
How did you fare in that respect? Maybe you should have a career as a financial analyst? Or maybe you already are?
Quote:

 Opt-A loans are coming up in 2011.  Be prepared for another rough ride.  
Fortunately, I'm not directly concerned anymore, but I'm convinced there's gonna be another rough ride, because nothing has changed; same people make the same mistakes, use the same obsolete economic model and continue to teach MBA's as before. I know I'm gonna be washed up when comes the next blow, but I don't know what I can do because I trust no one.

Offline ssltech

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Re: $2M Retirement.
« Reply #41 on: January 29, 2010, 09:29:07 am »
My wife and I frequently joke about this...

She's always been a keen believer in 'managing' investments. Her justification was "we've got to put our money to work for us!"

Some time about 2000, I looked at the performance with her and joked "That really is magnificent work! I've never seen ANYTHING dig a hole that fast!"

Oh how we larfed!  Laughing

Seriously though, I'm with Geoff on this: Good past performance and even incredible ingenuity is no reliable indicator of future performance. NO MAN can know the future with that much certainty.

Keith
MDM (maxdimario) wrote on Fri, 16 November 2007 21:36

I have the feeling that I have more experience in my little finger than you do in your whole body about audio electronics..

Offline JGauthier

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Re: $2M Retirement.
« Reply #42 on: January 29, 2010, 02:10:49 pm »
PookyNMR wrote on Thu, 28 January 2010 19:21

  There's video documentation of plenty of folks predicting this last crisis years ago with uncanny accuracy.  

The problem is no one listened and wrote them off.  There was too much money to be made trying to continue riding the bubble.

With such bad policies and practices leading up to the event, I don't understand how more people didn't see it.  



Its funny to see how most dont realize what you do. I worked as a title officer as a day job prior to opening the studio full time. We have known since 2003 the entire country was f*cked. It was only a matter of when. Literally.

The loans I saw come across out desk were unbelievable. Literally- SHOULD NEVER HAVE HAPPENED. And the best is the legislation that passed that allowed this ENTIRE FIASCO to occur is thanks to Mr. Bill Clintons admin. Period.

I have nothing against Bill and think George Bush should be shot so dont misunderstand. Just stating the facts. After the lending/real estate crash, I became a financial manager and thus had the pleasure of watching my clients stock drop from 40 to 4. That was an 8 figure loss for them.

And to the Ops question?

If you have 2 mil right now and cant double it in the next 2 years investing, you dont deserve to have the 2 million. This is POST DEVESTATING CRASH... If you have avaliable cash, you can really turn some coin. My father for example got in on B of A stock at the crash 5 a share- its at 15.28 today. Over 300% profit... We all knew B of A isn't going anywhere and 5 a share? Thats almost free.

And FYI- at this point if you worry about investing cause the economy may collapse again, if that really happens, you have wayyyyy more to worry about than just that...

Offline mukul

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Re: $2M Retirement.
« Reply #43 on: January 30, 2010, 05:52:43 am »
JGauthier wrote on Sat, 30 January 2010 00:40



...

My father for example got in on B of A stock at the crash 5 a share- its at 15.28 today. Over 300% profit...

...



Check your calculations, buddy.  It is 200% profit ... but you made your point.
Mukul M. Mittal
http://www.druflon.com

Offline Geoff Emerick de Fake

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Re: $2M Retirement.
« Reply #44 on: January 30, 2010, 07:06:14 am »
JGauthier wrote on Fri, 29 January 2010 13:10

 If you have 2 mil right now and cant double it in the next 2 years investing, you dont deserve to have the 2 million.
This is the most ridiculous sermon I heard for a long time. I made my money by hard work, setting up a company and hiring staff in the areas that I knew I didn't master, like HR, finance and admin. I sold the company and took the cash. I put it in funds, under the guidance of knowledgeable people who had a good record; they haven't seen it coming. How can you say I didn't deserve to have the two M? In what am I at fault? Clearly, you're not an EE. Next time you have a piece of gear that goes temperamental, will I have the right to say it's your fault, that you didn't deserve it in the first time?
Quote:

 My father for example got in on B of A stock at the crash 5 a share- its at 15.28 today. Over 300% profit...
Good for him, but you cannot turn one single experience into statistics. If he had done it consistently in several happenstances, that would mean a thing. And maybe he is a professional. I'm not, and I can't even tell one good finacial consultant from a bad one, except from hindsight. Just like you probably can't tell a good EE designer from a bad one at first glance.
Why didn't you take the ride with your father? You could be filthy rich and don't need to work your ass off in the studio...
Quote:

 And FYI- at this point if you worry about investing cause the economy may collapse again, if that really happens, you have wayyyyy more to worry about than just that...
I do...that's why I wrote "I know I'm gonna be washed up when comes the next blow"

Offline RMoore

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Re: $2M Retirement.
« Reply #45 on: February 04, 2010, 11:27:22 am »
Not an expert by any means on the subject but:


The safest long term return is having the money accrue interest with a reputable bank & US T-Bills

 http://en.wikipedia.org/wiki/United_States_Treasury_security

The above (T-bills & bank interest) was actually the personal strategy of some US investing / financial legend I read about, forget his name at the moment. As I recall he ran high-level investment funds but chose to pursue the safest course of investing for his own personal wealth.

Note that the limit for deposit insurance (eg: should the bank go bust) is I believe $100k per institution in the US.

If you are looking to deposit substantial sums you would think certain bank managers might offer competitive terms.

If it were me, I'd probably choose for the safe, assured returns instead of playing the 'lottery', I'd drive a used car &  definitely I'd continue to work at something I felt some interest or belief in.

2 Mil, fun to dream of!





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Offline RMoore

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Re: $2M Retirement.
« Reply #46 on: February 04, 2010, 11:39:11 am »
For those trying to decode the investment World & the element of randomness in life, economics, markets etc - the work of Nicholas Taleb (Wharton MBA) is very interesting. He takes a very dim view of his MBA brethren when it comes to anyone being able to accurately predict market events & trends which Taleb sees as being inherently random...basically a spin of the roulette wheel.. His POV seems to be people playing the stock market are gamblers - even big-time traders / MBA's, who are fooling themselves in a hubristic fog that they know what is actually going on :





http://en.wikipedia.org/wiki/Black_swan_theory
http://en.wikipedia.org/wiki/Nassim_Nicholas_Taleb
http://en.wikipedia.org/wiki/Fooled_by_Randomness

   http://www.fooledbyrandomness.com/

.. Taleb has been critical of the finance industry and has been credited with making predictions regarding financial crises and making a fortune out of the 2008 crisis.[9] [10] He held senior trading and financial mathematics positions at a number of New York City's Wall Street firms before starting a second career as a scholar in the epistemology of chance,[11] and as an activist and a promoter of what he calls a "Black Swan robust" society. He is also a promoter of aggressive "stochastic tinkering" as a means of scientific discovery.[12]

Taleb is a bestselling author with 2.7 million copies sold in 31 languages.[13] [14] His idiosyncratic writing style mixes narrative fiction (often semi-autobiographical) and short philosophical tales with historical and scientific commentary.

Taleb's best-known book, The Black Swan, has been described by The Times as one of the 12 most influential books of the past 60 years.[15] Among the people Taleb has influenced are the writer Malcolm Gladwell [16][17] and the British Tory leader David Cameron,[18] who uses his black swan robustness idea as "intellectual ballast" for his program.



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Fooled by Randomness: The Hidden Role of Chance in Life and in the Markets is a book written by Nassim Nicholas Taleb about the fallibility of human knowledge.

The book was selected by Fortune as one of the 75 "Smartest Books of All Time."[1]

The book's name, Fooled by Randomness, has also become an idiom in English used to describe when someone sees a pattern where there is just random noise.


Taleb sets forth the idea that modern humans are often unaware of the existence of randomness. They tend to explain random outcomes as non-random.

Human beings:

  1. overestimate causality, e.g., they see elephants in the clouds instead of understanding that they are in fact randomly shaped clouds that appear to our eyes as elephants(or something else);
  2. tend to view the world as more explainable than it really is. So they look for explanations even when there are none.

Other misperceptions of randomness that are discussed include:

   * Survivorship bias. We see the winners and try to "learn" from them, while forgetting the huge number of losers.
   * Skewed distributions. Many real life phenomena are not 50:50 bets like tossing a coin, but have various unusual and counter-intuitive distributions. An example of this is a 99:1 bet in which you almost always win, but when you lose, you lose all your savings. People can easily be fooled by statements like "I won this bet 50 times". According to Taleb: "Option sellers, it is said, eat like chickens and go to the bathroom like elephants", which is to say, option sellers may earn a steady small income from selling the options, but when a disaster happens they lose a fortune.









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Idea of value investing

Mega classic influential  - out of print  - $500 on the used book market - value investing tome 'Margin of Safety' - PDF version:
           http://financetrends.blogspot.com/2008/08/seth-klarman-margi n-of-safety-pdf.html

Warren Buffet http://en.wikipedia.org/wiki/Warren_Buffett

http://en.wikipedia.org/wiki/Value_investing



Value investing is an investment paradigm that derives from the ideas on investment and speculation that Ben Graham & David Dodd began teaching at Columbia Business School in 1928 and subsequently developed in their 1934 text Security Analysis. Although value investing has taken many forms since its inception, it generally involves buying securities whose shares appear underpriced by some form(s) of fundamental analysis.[1] As examples, such securities may be stock in public companies that trade at discounts to book value or tangible book value, have high dividend yields, have low price-to-earning multiples or have low price-to-book ratios.

High-profile proponents of value investing, including Berkshire Hathaway chairman Warren Buffett, have argued that the essence of value investing is buying stocks at less than their intrinsic value.[2] The discount of the market price to the intrinsic value is what Benjamin Graham called the "margin of safety". The intrinsic value is the discounted value of all future distributions.

However, the future distributions and the appropriate discount rate can only be assumptions. Warren Buffett has taken the value investing concept even further as his thinking has evolved to where for the last 25 years or so his focus has been on "finding an outstanding company at a sensible price" rather than generic companies at a bargain price.







++++++++++++++++++++++++

Another great one is Galbraith's The Great Crash - 1929.

Very witty & dry account of the financial meltdown - lots to learn about bubbles & human nature in this one. Definite parallels to recent times:

http://en.wikipedia.org/wiki/The_Great_Crash,_1929

The Great Crash, 1929 is a book written by John Kenneth Galbraith and published in 1954; it is an economic history of the lead-up to the Wall Street Crash of 1929. The book argues that the 1929 stock market crash was precipitated by rampant speculation in the stock market, that the common denominator of all speculative episodes is the belief of participants that they can become rich without work[1] and that the tendency towards recurrent speculative orgy serves no useful purpose, but rather is deeply damaging to an economy.[2] It was Galbraith's belief that a good knowledge of what happened in 1929 was the best safeguard against its recurrence.

Galbraith wrote the book during a break from working on the manuscript of what would become The Affluent Society. Galbraith was asked by Arthur M. Schlesinger Jr. if he would write the definitive work on the Great Depression that he would then use as a reference source for his own intended work on Roosevelt. Galbraith chose to concentrate on the days that ushered in the depression. "I never enjoyed writing a book more; indeed, it is the only one I remember in no sense as a labor but as a joy."[4] Galbraith received much praise for his work, including his humorous observations of human behavior during the speculative stock market bubble and subsequent crash.[5] The publication of the book, which was one of Galbraith's first bestsellers, coincided with the 25th anniversary of the crash, at a time when it and the Great Depression that followed were still raw memories - and stock price levels were only then recovering to pre-crash levels. Galbraith considered it the useful task of the historian to keep fresh the memory of such crashes, the fading of which he correlates with their re-occurrence.[2]



++++++++++++++++





Fwiw - I've read the Taleb books, Margin of Safety & the Galbraith book...  great stuff!


Btw - for anyone with a big pile of cash:



Some people made a fortune during the Great Depression who were cash rich & able to buy up land, property, companies etc for a song...









People's Republic of Ryan

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By the end of today, another day is gone forever. You will never get it back.
We must never let up for a second. Work harder at every single thing - Terry Manning

 You miss 100 percent of the shots you never take - Wayne Gretzky

Offline compasspnt

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Re: $2M Retirement.
« Reply #47 on: February 04, 2010, 12:36:43 pm »
NB: Through the end of 2013, the maximum amount insurable by the US FDIC per account has been raised from $100k to $250k.

Starting 2014, it will return to $100k, except that some retirement deposit accounts will remain at the higher figure.