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Post by Ninja on Jan 31, 2008 12:45:13 GMT -5
I don't plan on getting credit, it's one big trap in my eyes. If you take the number 72 and divide that through the interest rate you're getting/paying per year, you'll know how many years it will take for your savings/debt to double. If your creditcompany charged 12% (VERY modest!), it will only take 6 years for your debt to double! And in another 6 years, it has doubled AGAIN! Some creditcards can work in your advantage with insurance, rewards for paying in time, ect. But one missed payment and you're screwed! Considering my chaotic nature and poor memory, I'd rather not risk it.
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Post by cnu5000 on Feb 4, 2008 7:13:23 GMT -5
Ninja-I think you are on the right track. When I was your age, I had a little bit of this live for the day attitude. I worried about the world being destroyed in nuclear war and 27 years the world is still here. What I regret more is decisions around education than money.
I have always been a saver. My husband is 52 and is very much of a saver. We sometimes get criticized for thinking too much about retirement and we are older than you.
Another aspect to think about is the pension side of jobs. I know many people who look down at government workers but government workers do get good pension benefits.
I know in the US the trend to make pension portable. But still many jobs still reward length of service and there is money building in pension plans. Often times when people(often times this was more true for women) switched jobs they did not look how they were losing pension money.
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Post by Ninja on Feb 4, 2008 17:22:24 GMT -5
Well, it looks like my savings will have to be pillaged again My computer broke down a few weeks ago and I needed to buy a new one, since my studies make it impossible to go without (even if I wanted to... my computer is my life *nerd girl mode*). Now I need a new bed and matress... ouch! The matress is really bad and my bed is about to break... Both are 8-10 years old, but I had hoped they could last a few more years... Unfortunately, I have to attack the bed every week with glue and a screwdriver to keep it in one piece, and as for the matress... I wake up with backpain and not feeling rested at all. The only good thing about my bed now is the pillow *sigh* Why do beds and matrasses go downhill so fast anyway? They are fine for years and then suddenly within less than a month, you wake up feeling like a complete wreck. You get no warning! Well, my savings were meant for emergencies like this (it is an emergency, since my back is killing me and I really can't go very long without proper rest), but it's going to be a pretty big chunk so soon after that computer. One more big setback like this and my buffer is gone... (fortunately, I don't have any other expensive objects that need immediate replacement if they wear out, so I should be free from disaster for a few years)
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Post by cnu5000 on Feb 11, 2008 7:16:43 GMT -5
I still think not enough women plan for their retirement-even if this day and age they expect a man to support her.
I still think women need to face 1) they may never marry 2) they may divorce 3) they may need a times to support their husband.
Even in the most best circumstances that a woman marries a man and stays married to a man who gets a pension the woman will tend to outlive the man. Also when the man dies often pension benefits get cut for the spouse.
I know many married retired women who enjoy having their own pensions/retirement and say it gives them freedom to do the things they want.
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Post by princesspedicure on Feb 11, 2008 11:21:38 GMT -5
I actually went to a financial advisor this past Saturday to plan for my retirement. I've seen too many people who retire, but they have to get another job. What's the point of retiring if you have to keep working? I hope I am in the position one day (10 years is the goal) where I can retire if I want to, and I won't have to get another job. Even if I remarried, I still want my financial independence. I want to be able to rely on myself. I'm waiting to see what the advisor's proposal says regarding how I should invest, etc.
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Post by sleepykgm on Feb 11, 2008 12:15:12 GMT -5
You are never too young to start thinking about retirement. Don't let anyone tell you otherwise.
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Post by ivycreeping on Feb 28, 2008 7:50:21 GMT -5
It is NEVER too young to think about retirement. You're smart for considering it.
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Post by Ninja on Mar 1, 2008 10:21:21 GMT -5
Thanks for the support everyone, it's not easy being the 'weirdo' of the family (I know they love me though ) Yesterday, we were celebrating my uncle's birthday with the whole family. We were discussing the news and my nephew told us about a brittish man who had won a milion pound by betting 50 pence on a horse. Then the topic changed to what each of us would do with a milion euros... Nephew: I'd buy a brand new car and take my girl on a sweet cruise around the world! Uncle: I'd buy a big house with cash and maybe a boat... My parents: yeah, we'd also go for the house and maybe if we have some left over, we'd take a trip to Italy when we retire. me: well, I'd put a down payment on a house and get a mortgage and then rent said house to tenants, or maybe I'll just put about half in didivend paying stocks and the other half......... What?! Why are you looking at me like that?
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Post by ana on Mar 2, 2008 10:11:51 GMT -5
Too funny!
I've always thought it would be smart just to live off the interest or dividend income and leave the principal intact. That way when I die, I could set it up in a trust and have the fund give out a scholarship with the income every year. Talk about leaving something behind. Much better than having a child.
Nice to see another person like me out there!
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Post by Ninja on Mar 2, 2008 11:37:30 GMT -5
Too funny! I've always thought it would be smart just to live off the interest or dividend income and leave the principal intact. That way when I die, I could set it up in a trust and have the fund give out a scholarship with the income every year. Talk about leaving something behind. Much better than having a child. Nice to see another person like me out there! Time is money, but to me, money is time. Why work for money when I can get my money to work for me? I have better things to do My ultimate goal would be to get my passive income (dividents, interest, royalties, stuff like that) to cover my expenses. In theory, if I ever get to that point, I'll never have to go to work!
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Post by cnu5000 on Mar 4, 2008 7:12:18 GMT -5
I have read somewhere if you get a lump sum of money what you should do is invest it and live off the interest.
I know some child-free people who have had very nice retirements and were child-free. My parents are having a nice retirement being grandchild-free. Until recently I did not make a connection that these people are without the responsibility of children. They take classes and travel alot. I don't think these people would take some many trips if they had to worry about supporting a younger generation.
However, these people did not retire young and it was not until their sixties that it became they seemed more financially carefree.
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Post by Ninja on Mar 4, 2008 13:53:52 GMT -5
I have read somewhere if you get a lump sum of money what you should do is invest it and live off the interest. My plan exactely, though I don't think I can quite live off the interest of 300 euros per year... ;D my new bed and computer set me back big time, though I'm happy I didn't need to take out a loan for them. I never could have saved for those... the school computers are always taken and I study multimedia design, so an 'ordinairy' library computer won't cut it, so I needed a new high-end (expensive!) computer in a few days. As or my bed... well, my back was killing me, so I couldn't affort to delay that expense either. Oh well... at least I payed for them and not some shady creditcard company. I've seen what they did to some of my friends, some of them lay awake all night worrying while the bills keep pouring in. Because of the ridiculous interest, it's nearly impossible to pay off their debt, in which they are up to their eyeballs. I will NEVER allow myself to touch a creditcard, except perhaps for internet payments or stuff like that, and only when I have the cash to back it up. The only debt I have (and still building, sigh...) is a student loan, and I intend to keep it that way. Well, back on topic ;D: I'm always amazed when I see someone who makes a hefty salary, live in a giant house. And I'm not talking 'roomy', I'm talking friggin Taj Mahal size here. Not only does the house eat up your lump sum or (slightly smarter choice) comes with huge mortgage payments, but it also takes eons to clean/even more money to have someone else do it, and money for upkeep, interior, heating... What a waste! And if that isn't enough, these high income people then eat in very expensive restaurants, buy brand new cars that lose value the minute their foot hits the gas pedal, and just live the high live. When the man/woman is fired, they have nothing to show for their years of hard work except worthless stuff and, worse, liabilities that will eat them alive. And even when they are not fired... they will be forced to keep working! Forget early retirement, all their money is in that brand new speedboat they bought last week, or all the fancy dinners that they can't even remember. I don't believe in living like a bum just so you can scrape a few more months off your retirement age, but if I had been them, I would have lived below my means, have the excess money work for me and then quit my job so I can spend the best hours of my day and healthiest years of my life doing what's really important to me. And that's not collecting stuff: it's creating stuff, like art. I've read a book last week that pretty much confirms what I've been suspecting for a while. It's called "Rich Dad, Poor Dad" and though pretty controversial, the author does make a few excellent points: fist: being wealthy is not about how much money you have, it's about how long you will survive on it if you quit your job today. Let's say A and B both have 6000 currency-of-your-choosing. A's expenses are 2000 a month, and B's expenses are 6000 a month. A can last three months without a job, B only has one month to find a new one. A is three times as wealthy as B, even though their savings are the same. second: the poor spend money on stuff, the middle class spend money on liabilities, the rich spend money on assets. Though we aren't really 'working class' yet, me and my classmates fit into the fist two patterns. I have the 'cashflow' pattern of the poor: at the moment, my money mainly goes to stuff, like my new bed and computer, though I do scrimp and save so I can set some aside to buy moneyproducing assets like stocks that pay dividend. This should give me some more financial leeway without getting a job, even if its not much. My troubled friends have the cashflow pattern of the middleclass: they spend their money on liabilities, like creditcard debt, that take money out of their wallets every month. Most of them break just even, a few are sinking deeper and deeper into debt. A good friend of my parents has the typical pattern of the rich: she spend her money on a cottage in the alps that she rents out to tourists. She also owns student housing in our own country that she rents out. She only has to work part-time, though she lives a very luxurious lifestyle. If she really wanted, she could probably cut expenses enough to retire today. It seems like I have what is supposedly called 'the milionaire mind', according to a blogger I ran into when trying to learn more about the stockmarket (more difficult than it looks... I've been at it for months and I feel like I just barely covered the basics! ). I'm going to guess this is a good thing... He said there's a book with the same title that I should read. Has anyone here read it before? EDIT: whoa, what a post! I hope I'm not obsessed...
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Post by cnu5000 on Mar 5, 2008 7:17:09 GMT -5
When I was in my twenties I lived with roomates in an apartment that had some rental control and had no car. It was a struggle for me just to get the money to live on-I had to get some raises before I was able to save.
I thought United States was more into big spending than other parts of the world-it appears that I am wrong. While I am proud of my country, I do feel that the US at times is a materialistic culture and it is a matter of national pride our highs standard of living for some of our population.
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Post by Ninja on Mar 5, 2008 8:41:42 GMT -5
When I was in my twenties I lived with roomates in an apartment that had some rental control and had no car. It was a struggle for me just to get the money to live on-I had to get some raises before I was able to save. I thought United States was more into big spending than other parts of the world-it appears that I am wrong. While I am proud of my country, I do feel that the US at times is a materialistic culture and it is a matter of national pride our highs standard of living for some of our population. If I had to choose between the cashflow pattern of the poor and that of the middleclass, I'd take the first any day! I'd rather live paycheck-to-paycheck and at least break even, than get a loan for a car and then find out that I can't afford the payments. At least your cashflow was somewhere around zero and not a negative number Europe always seems to be one step behind on the States when it comes to negative aspects of their culture. We are recently seeing a lot of people with serious weight problems, babies are born more and more in hospitals than in their own homes, and racism is on the rise. America has a great culture when it comes to patrionism, doing volunteer work and 'knowing your neighbours', but of course those parts aren't catching on here... What worries me, is the increased use of creditcards and loans. Not too long ago, you paid for everything with cash or a debit card and the only acceptable loans were those for education, a home, or starting your own business. You set aside some money for an emergency fund every month, and if yoy wanted some shiny gadget you had to save for it. Lately however, I've been getting creditcards in the mail (WTF?! Get those things away from me!), the companies trying to tempt me. Especially around Christmas it was bad: do I want a little extra money for the holidays? Just sign right here... I buy clothes from a catalogue sometimes and even they send me a card, assuring me that I could have everything I wanted for just a few monthly payments. Did I, their loyal and trusted customer, not deserve the very best? And did I not owe it to myself to buy all that stuff right now? This trend seems to be blowing over from the States, where more and more people are up to their eyeballs in (creditcard)debt. At the moment, I can't even turn on the tv without seeing a happy couple getting giddy over their new plasmatv, and then thanking the slick looking man from *insert shady loan company here* who made it all possible. Saving first and buying later is for losers... you only live once! And you too can make your dream a reality right now! You deserve it! My parents always warned me to never spend money that I do not have, and they sleep well at night. I'd rather take their advice and buy my gadgets later, than settle for 'low monthly payments' that will eat me alive.
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Post by cnu5000 on Mar 6, 2008 7:08:26 GMT -5
Maybe I got this from my parents too-don't get into credit card debt. My husband is doen't get into credit card debt either.
The interest rates on these cards is so large.....
I am not a homebody but sometimes with these big houses I wonder who has the time to take care of them even if they have the money. I remember the time when people who had big houses the woman both stayed at home AND had household help. Now to maintain these big houses both spouses have to work long hours and have long commutes.
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Post by Ninja on Mar 6, 2008 7:20:14 GMT -5
Maybe I got this from my parents too-don't get into credit card debt. My husband is doen't get into credit card debt either. The interest rates on these cards is so large..... I am not a homebody but sometimes with these big houses I wonder who has the time to take care of them even if they have the money. I remember the time when people who had big houses the woman both stayed at home AND had household help. Now to maintain these big houses both spouses have to work long hours and have long commutes. I read the fine print of some of the cards I get in the mail. You're fine if you keep up with payments and sometimes you even get extra benefits. But slip up once... and you're trapped. The interest rate shoots up to up to 20% on some of the cards I've seen! 72/20=only 3,6 years for your debt to DOUBLE, and another 3,6 years before it doubles AGAIN! Whoa! I'd rather pay for my stuff just once, thank-you-very-much
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Post by ana on Mar 6, 2008 13:18:54 GMT -5
Not all credit card use is bad. You have to make sure that you have the funds BEFORE you purchase anything. We love to use our credit cards because it's only one bill a month and we get to keep our money earning interest longer. Just make sure to pay off the entire balance every month. This will increase your credit rating so when you are ready to purchase a house you will be able to get a "preferred" interest rate which can save you thousands.
Worked for us.
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Post by Ninja on Mar 6, 2008 19:00:09 GMT -5
Not all credit card use is bad. You have to make sure that you have the funds BEFORE you purchase anything. We love to use our credit cards because it's only one bill a month and we get to keep our money earning interest longer. Just make sure to pay off the entire balance every month. This will increase your credit rating so when you are ready to purchase a house you will be able to get a "preferred" interest rate which can save you thousands. Worked for us. True, but some people are just too tempted to charge a little bit more ("it's only on sale for a few days!") than they can back up. That's when trouble starts. If you know you're 'weak', then getting a creditcard is probably not the wisest move. As for me, I'm terribly chaotic and tend to forget how much cash I have left and to pay off the bil. Give me a creditcard and you might as well just file me for bankruptcy right away. I'm just not organized enough to handle a creditcard. But that's okay, I pay for everything with cash or a debit card and have set up my bankaccount in such a way that I can't go in the red. If my budget for the month is gone, it's gone and I won't risk spending more than I have. I don't want to buy a house, prices in the Netherlands are outrageous! It's much cheaper to rent until our own housingbubble finally pops. I'm saving my money for the looming stockmarketcrash!
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Post by cnu5000 on Mar 7, 2008 7:14:24 GMT -5
Here are other advantages of credit cards if you can pay balances right away: 1) many credit cards over rewards for those who use them. For example some credit cards give points that can earn extra cash or used towards airline tickets etc. 2) You can fight unfair charges of merchants with the credit card copy.
However, I think when most people talk about credit card usage there usually is the implication that people are not paying off their balances in full every month.
I live in a part of the US where the cost of living is very high-it is hard to afford housing. Many people whom I have grown up with have had to leave. Probably a big reason I am still in the area is that I am child-free and it is where I grew up.
So sometimes when I complain about people spending money, it carrries the implication that I don't think people can afford it.
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Post by Ninja on Mar 7, 2008 14:43:38 GMT -5
Here are other advantages of credit cards if you can pay balances right away: 1) many credit cards over rewards for those who use them. For example some credit cards give points that can earn extra cash or used towards airline tickets etc. 2) You can fight unfair charges of merchants with the credit card copy. However, I think when most people talk about credit card usage there usually is the implication that people are not paying off their balances in full every month. I live in a part of the US where the cost of living is very high-it is hard to afford housing. Many people whom I have grown up with have had to leave. Probably a big reason I am still in the area is that I am child-free and it is where I grew up. So sometimes when I complain about people spending money, it carrries the implication that I don't think people can afford it. Well, I might get a VISA to buy stuff online, but that's it. I wouldn't use it for purchases like clothes or stuff like that. The extra benefits, for me, don't compensate the risk of falling in the interest trap, which is especially high for me since I have ADHD and have trouble organizing. Things like automatic payments are a godsend for me ;D
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