The Investment Thread (help with savings, stocks, retirement funds, etc.)

[smokew11]

right I know that's not the 403, that was the pension plan. employer doesnt match the 403

[Lee3691]

Originally Posted by Benny003

Just curious, why did you get a 35-year policy? You'll be in your late 60's by the time it ends. Kids will be out of school in 20 years or so. Most of the house will be paid off within 20 years and student loans would probably be paid off by then too. What real benefit does the extra 15 years offer or really what need is it filling once the kids are out of college and the house is paid off?

Wife and I are insured into my early 70s. I want to make sure my daughters are protected and in a position to thrive as much as possible, if I go.

[42graystreet]

Originally Posted by Lee3691

Wife and I are insured into my early 70s. I want to make sure my daughters are protected and in a position to thrive as much as possible, if I go.

That's understandable. It's very much a personal decision IMO to have a life insurance product that is likely to be still around when you kick the bucket.

There's a reasonable scenario where you live long enough that your term policy has lapsed and you've pretty much spent down your nest egg. For some people that's fine because their beneficiaries don't need anything by then. But for others they still want to leave a significant inheritance behind. What the insurance industry calls your "legacy."

[MOWJO8185]

I think I got a 25 year term. Will get all my kids through school and the house almost if not all the way paid off. If I bite it after that, the hope is that my retirement funds will be in a good enough place to cover any remaining needs. If I feel the need to purchase more after that it would be a much smaller benefit amount.

[Benny003]

Originally Posted by Lee3691

Wife and I are insured into my early 70s. I want to make sure my daughters are protected and in a position to thrive as much as possible, if I go.

Originally Posted by 42graystreet

That's understandable. It's very much a personal decision IMO to have a life insurance product that is likely to be still around when you kick the bucket.

There's a reasonable scenario where you live long enough that your term policy has lapsed and you've pretty much spent down your nest egg. For some people that's fine because their beneficiaries don't need anything by then. But for others they still want to leave a significant inheritance behind. What the insurance industry calls your "legacy."

I guess I had never heard of using an insurance policy as an inheritance plan.

[Kevtalia]

Originally Posted by Benny003

Just curious, why did you get a 35-year policy? You'll be in your late 60's by the time it ends. Kids will be out of school in 20 years or so. Most of the house will be paid off within 20 years and student loans would probably be paid off by then too. What real benefit does the extra 15 years offer or really what need is it filling once the kids are out of college and the house is paid off?

We were focusing on the longevity versus the amount. For the 30 year term versus the 35 year term, it was like an extra $12 / month each or something.

We can always cancel or convert some of the insurance to whole term once we get older. Wanted that extra 5 years just in case I guess

[Benny003]

Originally Posted by Kevtalia

We were focusing on the longevity versus the amount. For the 30 year term versus the 35 year term, it was like an extra $12 / month each or something.

We can always cancel or convert some of the insurance to whole term once we get older. Wanted that extra 5 years just in case I guess

Yeah, I got a 20-year policy earlier this year. I guess I was just looking at it more like just covering debts and lost income. In 20 years, our debts and lost income will be significantly less important (I assume) based on the assumption that the kids would be adults then and the house would be mostly paid off by then.

[42graystreet]

Originally Posted by Benny003

I guess I had never heard of using an insurance policy as an inheritance plan.

Ideally, you can self-insure in your retirement by simply living off the income your portfolio generates. But of course, not everyone has the luxury of a portfolio where the 4% rule provides sufficient income for the rest of your life even in times of market downturns. You may find yourself in a position where you're starting to eat into your principal little by little each year. If you live long enough, what remains in your portfolio isn't quite the gift you were hoping to pass on to your kids/grandkids. If that's important enough for you, life insurance can be there to ensure your gift is what you want it to be.

Jesus, I sounds like Ned Ryerson

[RiotAct]

Originally Posted by 42graystreet

Ideally, you can self-insure in your retirement by simply living off the income your portfolio generates. But of course, not everyone has the luxury of a portfolio where the 4% rule provides sufficient income for the rest of your life even in times of market downturns. You may find yourself in a position where you're starting to eat into your principal little by little each year. If you live long enough, what remains in your portfolio isn't quite the gift you were hoping to pass on to your kids/grandkids. If that's important enough for you, life insurance can be there to ensure your gift is what you want it to be.

Jesus, I sounds like Ned Ryerson

I have a strange urge to go watch an episode of Matlock now.

[MOWJO8185]

Maybe this makes me a terrible father, but I've never thought of leaving an inheritance behind as part of my financial goals. I mean, I've covered off on life insurance to make sure everyone's needs are covered if I die an untimely death, but if I live to 90 or something I can't say I've made it a goal to have a nice little nest egg for my kids. I'm sure it's something I'll think about a little more once I've met more imminent goals. Ideally I will have saved enough for retirement that that's a welcome bonus that I'm able to offer them.

[42graystreet]

Originally Posted by MOWJO8185

Maybe this makes me a terrible father, but I've never thought of leaving an inheritance behind as part of my financial goals. I mean, I've covered off on life insurance to make sure everyone's needs are covered if I die an untimely death, but if I live to 90 or something I can't say I've made it a goal to have a nice little nest egg for my kids. I'm sure it's something I'll think about a little more once I've met more imminent goals. Ideally I will have saved enough for retirement that that's a welcome bonus that I'm able to offer them.

I hear ya. It's a totally personal decision. For me, I have way more life insurance than I probably need. But I'm okay with that because I watched my Mom have to draw down her and my Dad's entire live savings in order to pay for his long term care. When he died in 2017, the only thing she got was a very modest $150K life insurance check. She'll be living off social security, a small pension and that $150K the rest of her life. It's not a comfortable position. She of course has massive regrets that they weren't better prepared for what happened and she now has very little to pass on to me and my 2 siblings. Basically, her house is it.

That's not going to happen to me or my family.

[coolhotwaves]

Anyone have preferred reits they like?

[AJF_41]

Originally Posted by coolhotwaves

Anyone have preferred reits they like?

What’s your interest in REITs?

They tend to trade with equities. There’s also a chance rising rates (have to go up at some point right) could act as headwind to the sector.

[Parrot Head]

Originally Posted by AJF_41

What’s your interest in REITs?

They tend to trade with equities. There’s also a chance rising rates (have to go up at some point right) could act as headwind to the sector.

Echo this in regards to potential future risk.

HINES has had some good stuff in the past though.

Private REITS I tend to stay away from (as do most brokers for selling away purposes), but if you are living in healthy local economy, there can be some good opportunities. I like senior living facilities in the REIT marketplace right now.

As far as life insurance goes, it really comes down to cash-flow. Products like Whole Life or Universal Life can be great products, but they are often positioned at the wrong time and most often sold too early to people that can't yet afford them. I think everyone should have some form of life insurance in their financial plan, especially business owners or professionals with a great deal of student loan & mortgage debt. For basic coverage though, 7-10 times income on a term life plan from a top-rated company is a good ballpark, and then if you can afford more outside of traditional savings/investing goals, add or convert to permanent insurance. Great tax diversification tool and patient capital to have in the portfolio.

[Benny003]

Originally Posted by MOWJO8185

Maybe this makes me a terrible father, but I've never thought of leaving an inheritance behind as part of my financial goals. I mean, I've covered off on life insurance to make sure everyone's needs are covered if I die an untimely death, but if I live to 90 or something I can't say I've made it a goal to have a nice little nest egg for my kids. I'm sure it's something I'll think about a little more once I've met more imminent goals. Ideally I will have saved enough for retirement that that's a welcome bonus that I'm able to offer them.

That was my same thinking. If I have something left over to leave my kids, great, but I'm not going to stress over it if I "only" have enough to take care of myself and my wife during retirement.

[42graystreet]

Originally Posted by AJF_41

What’s your interest in REITs?

They tend to trade with equities. There’s also a chance rising rates (have to go up at some point right) could act as headwind to the sector.

I don't necessarily believe they *have* to come up at any time in the near future. We could be in a low interest rate environment for the long-term. There's a great recent episode about this on NPR's Planet Money podcast.

[ShotgunDMB]

TD Ameritrade just got rid of all their commission fees

[Route_2]

Originally Posted by ShotgunDMB

TD Ameritrade just got rid of all their commission fees

The brokerage price wars are in full swing.

[42graystreet]

Schwab did it first. I'm going to guess Fidelity will be next.

[AJF_41]

race to 0...

[RiotAct]

The market ALWAYS shoots down the day or two immediately following my bi-weekly contribution from my paycheck to my 401k. Never fails.

[Route_2]

Originally Posted by AJF_41

race to 0...

Just got the notice for my E*Trade account.

[42graystreet]

Originally Posted by Route_2

Just got the notice for my E*Trade account.

E*TRADE went to zero?!? Wow. RIP Robinhood.

[drakan]

Originally Posted by RiotAct

The market ALWAYS shoots down the day or two immediately following my bi-weekly contribution from my paycheck to my 401k. Never fails.

Wish I could model the riot act puts money into his 401k and the stock market soon falls to start a hedge fund.

[42graystreet]

I went back and read the first few pages of this thread. Great stuff!

Originally Posted by Lee3691

If you can find 3% savings guaranteed, please let me know

I bank at a credit union (Baxter CU). I get 3% APY in my checking account up to $15K.

Originally Posted by Rebecca De Mornay

ESPP plans are not as good as advertised... usually.

The 15% discount is taxed as ordinary income and the purchase date for employees usually coincides with the equity bonus dates for the exectuives which often seems to go with a bump in the stock price.

No offense, but this kind of advice misses the forest for a tiny weed. Even if you have a stock purchase plan that taxes your earnings at the ordinary income rate, you're telling me it's not good to get an automatic 10-11% return just for participating?!? And who gives a crap about the C-level. Take advantage of this shit.

Originally Posted by thebridge15

Ok 401 is set up.

How's this 401(k) doin? Did you stick with it? Did you get those vested employer matches?

[Route_2]

I don't participate in my company's ESPP because they require us to hold the shares for a year prior to selling.

[42graystreet]

Originally Posted by Route_2

I don't participate in my company's ESPP because they require us to hold the shares for a year prior to selling.

Any particular reason that holds you back? It's probably for the better that they make you do that. For one, the longer you hold, (hopefully), the likelier your company's stock price will go up or at worse stay flat. And second, if you hold your positions long enough, the earnings will get taxed at the lower capital gains rate as opposed to your federal income rate should you sell prior to the holding period.

Either way, I highly recommend participating in an ESPP, even if it's just like 2% of your salary. It's taxable savings, yes, so it shouldn't replace your savings going to tax-advantaged accounts (401k, IRA, etc.) but the price discount you get is too good to pass up IMO.

[Route_2]

Originally Posted by 42graystreet

Any particular reason that holds you back? It's probably for the better that they make you do that. For one, the longer you hold, (hopefully), the likelier your company's stock price will go up or at worse stay flat. And second, if you hold your positions long enough, the earnings will get taxed at the lower capital gains rate as opposed to your federal income rate should you sell prior to the holding period.

Either way, I highly recommend participating in an ESPP, even if it's just like 2% of your salary. It's taxable savings, yes, so it shouldn't replace your savings going to tax-advantaged accounts (401k, IRA, etc.) but the price discount you get is too good to pass up IMO.

If I was able to sell immediately it would be a no brainer. Holding for a year introduces risk. We are a mature company, not growth, so the price bounces around about a $20 range the last 10 years or so. The price discount is not guaranteed in my case.

[42graystreet]

Originally Posted by Route_2

If I was able to sell immediately it would be a no brainer. Holding for a year introduces risk. We are a mature company, not growth, so the price bounces around about a $20 range the last 10 years or so. The price discount is not guaranteed in my case.

I hear ya. Definitely something you have to consider. My company is BSX. Go back far enough and it's a wild ride. Down 88% from 2004 to 2012. Up 634% ever since. I'm comfortable with the future outlook to put 3% of my salary. I don't hold positions forever. I use that money on an ongoing basis for larger purchases.

[YouNeverKnow25]

my espp is 15% off the lowest price from the previous quarter. I always want to put more into it than I do, and I've increased every quarter.