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Old 12-22-2011, 09:40 AM   #41
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(the steep drop on the red line is people defaulting on their loans)
I don't see a problem, we are just doing the same thing our government does and teaches us.



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Old 12-22-2011, 09:41 AM   #42
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At least with a house theres equity.

Is that why I went into debt, and emptied out my six figure bank account when I sold mine?



Oh yeah, you love bubbles...
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Old 12-22-2011, 10:20 AM   #43
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At least with a house theres equity.
As Brain alluded to, that is a gross oversimplification at best. You could theoretically have $100k equity in a house with no mortgage that you ended up paying over $250k for. On one hand, you've got $100k equity. On the other hand, you lost $150k.

I recommend people only buy a house if they believe they will live there for a long time - which would entail a strong sense of job security and roots in that community. The biggest problem with houses today (and I expect in the near to intermediate future) is lack of liquidity. It takes away a lot of mobility for young people (i.e. changing jobs, moving to new locations, etc).

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I do use the plastic, but I pay it off each month. Cards can offer additional protections against using cash plus you get points. Any purchases made on revolving credit are paid off that month, then the points are accumulated and eventually redeemed. There is no extra cost to me, and we get something cool out of it over time.
If you are disciplined, rewards based credit cards are great. Like you said, you've got additional protections built in plus "free money" via the rewards (our main one is a cash-back Visa). We recently picked up a new car for the Mrs. and called to up the credit limit so we could put a big chunk through the card.

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I don't see a problem, we are just doing the same thing our government does and teaches us.
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Old 12-22-2011, 10:22 AM   #44
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yeah but we cant print fake money
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Old 12-22-2011, 10:54 PM   #45
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nest egg
When I get into the Marines I'm thinking of doing something equivalent to putting a dollar a day into a roth IRA. Probably a percentage of my paycheck, my bro said they talked to the recruits about it at boot camp.

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Is that why I went into debt, and emptied out my six figure bank account when I sold mine?



Oh yeah, you love bubbles...
lol, no wonder your a librarian.
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Old 12-22-2011, 10:59 PM   #46
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I take money out of my paycheck every two weeks for my Roth (and my wife's as well). It is automatically withdrawn and transferred to Etrade. Every three months I purchase stock with it (manually). We currently max out both Roths and my 401K. I don't really worry too much about the market dropping because that means I am buying new shares at a cheaper price.
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Old 12-23-2011, 11:42 AM   #47
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I take money out of my paycheck every two weeks for my Roth (and my wife's as well). It is automatically withdrawn and transferred to Etrade. Every three months I purchase stock with it (manually). We currently max out both Roths and my 401K. I don't really worry too much about the market dropping because that means I am buying new shares at a cheaper price.
you should worry more about historically high days.

smileyface.
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Old 12-23-2011, 12:29 PM   #48
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lol, no wonder your a librarian.
what about my librarian?
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Old 12-23-2011, 12:30 PM   #49
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When I get into the Marines I'm thinking of doing something equivalent to putting a dollar a day into a roth IRA.

that's retarded when you have a yearly limit of $2,000. you should be putting $5 a day into it; like the Brain.
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Old 12-23-2011, 01:39 PM   #50
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you should worry more about historically high days.

smileyface.
Assuming he is putting in a fixed dollar amount per purchase period, he is buying fewer shares at the higher prices while buying more shares at the lower prices (in addition to actually adding money).

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that's retarded when you have a yearly limit of $2,000. you should be putting $5 a day into it; like the Brain.
Why does he have a $2k yearly limit for Roth contributions?
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Old 12-23-2011, 03:34 PM   #51
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that's retarded when you have a yearly limit of $2,000. you should be putting $5 a day into it; like the Brain.
Did not know about the yearly limit, what if I had multiple IRAs? Then again I think they can be taxed so maybe I'll just be like the Brain.
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Old 12-23-2011, 04:22 PM   #52
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Why does he have a $2k yearly limit for Roth contributions?
cause thats the way Roth IRAs work. it's either 2K or 5K a year limit, and if you make over a certain amount a year you cannot do them.

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Did not know about the yearly limit, what if I had multiple IRAs? Then again I think they can be taxed so maybe I'll just be like the Brain.
I dont think you can, or when you report it, the gov't wont like what you did when they audit you.

roths aren't taxed, you load them up with pretaxed dollars, then when you withdraw after 40 years of exponential growth, you do not have to pay taxes on them. thats the reason they are so bomb and why you should contribute as much as possible to them.
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Old 12-23-2011, 04:23 PM   #53
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Another upside is compounding interest right? Or am I thinking of something else?
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Old 12-23-2011, 04:25 PM   #54
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no, that's the main benefit. taxewd now, grow, then you dont pay taxes on it later when its worth millions.
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Old 12-23-2011, 04:27 PM   #55
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Can you have more then one?
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Old 12-23-2011, 05:24 PM   #56
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cause thats the way Roth IRAs work. it's either 2K or 5K a year limit, and if you make over a certain amount a year you cannot do them.
I am not sure where you are coming up with the $2k per year limit. The maximum contribution is $5k per year for those under age 50, up to earned income, subject to phase-outs (beginning at $169k for a married couple and $107k for single, AGI).

$2k is an old contribution limit, which you may be thinking of.

You may have multiple traditional IRAs and Roths at any given time, however, your annual contributions are capped in aggregate. Said another way, if you were eligible to contribute $5k for the year, it would be a total of $5k among all of them. Deductible traditional IRAs have lower income eligibility phase-outs.
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Old 12-23-2011, 05:59 PM   #57
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i let my broker handle my money. i cant keep track of the limits, like I said, I've breached the earned income, so only give to my various roll-over and trad. iras.
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Old 12-23-2011, 08:25 PM   #58
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I don't mess with brokers any more. Years ago I had one and stopped in to buy a stock with my wife. He talked me out of buying $4K of Compaq stock (worth about $400,000 just a few years later). I figure if they actually knew anything (other than some legal and accounting stuff) they would be living on a beach somewhere.
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Old 12-23-2011, 09:49 PM   #59
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I don't mess with brokers any more. Years ago I had one and stopped in to buy a stock with my wife. He talked me out of buying $4K of Compaq stock (worth about $400,000 just a few years later). I figure if they actually knew anything (other than some legal and accounting stuff) they would be living on a beach somewhere.
A decent money manager will help you with tax sheltering, diversifying/allocation, risk assessment, investment prioritizing, etc. They aren't just there to give specific stock advice. People who are exclusively brokers are extremely rare these days.
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Old 12-23-2011, 11:07 PM   #60
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People who are exclusively brokers are extremely rare these days.
I was talking about 1989. It was an Edward Jones office.
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