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12% Returns

Discussion in 'Random Discussion' started by Sarge, Oct 19, 2003.

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  1. Sarge

    Sarge Thread Starter

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    I know there are alot of intelligent people here at TSG and I would like to ask this question. We had a "financial briefing" in my unit and the speaker said we should put our money in something that will give us a 12% return. He didnt go into detail and I know nothing at all about investing. My money (the whole $124.00) is in a bank. Id like to start saving for my retirement but I dont know what or where to begin but from the brief I recieved I know a bank will not help me 20 to 30 years down the road. Any ideas?
     
  2. Aaron.W

    Aaron.W

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    Real estate. Become a landlord and collect rent for the rest of your life. ;]
     
  3. gws226

    gws226

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    Generally 12% is a little unrealistic.... The average rate of return for the market is around 7% for the life of the stock market.

    It really depends on how much risk your willing to take... I took a chance on bond funds a year ago and did 17% while the market was still tanking...

    The real key to investing is determining the amount of market risk that you are willing to take and invest your money based on that model.... Putting all your money into one stock, one fund, one investment... is very very risky... the reward could be great... but the loss could cost your years of your retirement.

    Try taking a risk test to determine how aggressive/conservative that you feel you need to be in market... to help realize your return... while being comfortable with your investment...

    At the end of this test there is a link to an asset allocator suggesiton program... take a look at... take a guess of how you spread out your investment capital and see what the program suggests is a good balance for you...
    http://www.msnbc.com/news/358579.asp

    I doubt that it will suggest investing more than 20% of your available investement cash in a high risk opportunity.

    Good luck
     
  4. gws226

    gws226

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    That is an excellent suggestion....
    Take advantage of any GI funds that will help you purchase your first home...
     
  5. Sarge

    Sarge Thread Starter

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    I already own a home...well, I own a mortgage but Im talking about something for retirement. Something that will give me good returns while Im saving (or trying to).
     
  6. gws226

    gws226

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    Historically owning land has been your best bet...
    Have you ever thought of becomming a landlord...

    My parent's bought their house in 1990 for $190,000... it was a appraised at $450,000 in 2000.

    My old neighbors bought their hourse for $265,000 in 98 and just sold it last week for $469,000!

    + owning a home is the last true handout from the government... (ie: the tax writeoff.)

    Did you take the test yet? How did you score?
     
  7. angelize56

    angelize56 Always remembered in our hearts

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    I'd ask Candy myself! :D She's a financial wizard! :)
     
  8. buckaroo

    buckaroo

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    Sarge, the 12% return is often used as a reference. As gws226 noted that may not be a realistic return, but at that rate you will double your $$ every six years and that's why it's used as an example to encourage people to invest.

    :)
     
  9. john1

    john1

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    Your score is 21

    15-29 points makes you a MODERATE INVESTOR:
    You're a middle-of-the-road investor. You know you have
    to take some risk in order to beat inflation, and you're
    willing to accept the chances of some loss of principal.
    You want predictable returns for your money.

    sounds about right to me.
     
  10. gws226

    gws226

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    Its not intended to give you an exact answer... merely to take simple questions and put you in a ballpark that would better define the level of risk you are willing to accept.
     
  11. gotrootdude

    gotrootdude

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    This is what I do....

    First off, I have a simple retirement plan that's tax sheltered called a SarSet. Kinda like a IRA. Each week I have a small amount that won't be missed slipped into it by direct deposit, the company matches my deposit. The sarset funds are devided into middle risk investments and generally net around 7-15% annually.

    I have a free checking account that I deposit my paycheck into. Each month, I take any unused cash in the account and purchase series I savings bonds. This type of bond is inflationary protected. The bonds are kept in a firesafe in my bedroom. The bonds can be cashed in as long as you have had them over 6 months, making them very liquid. Throughout the year, I come across various short term investment opportunities that net anywhere between 10-200% monthly and cash the bonds in to take advantage of these, then I buy more bonds with the payoffs. When the bonds reach a few thousand, (5,000 or more), I deposit the bonds into the sarset and the company matches the deposit again. I'm always on the lookout for ways to invest, but always keep a stockpile in liquid assets. My house and land was bought for $40,000 seven years ago. When I bought it, the house was only a shell, no interior walls or floors. I took out a mortage at 6% for another $40,000 and finished the interior. Although there is still alot to do in my four bedroom home, it's appraised at $130,000. Keep a eye out for people who start building, and don't have enough money to complete the project! ;)

    I estimate my holdings at around $200,000 which is pretty good for a man living in the south under 40 years of age.

    Forgot to mention, there's around $20,000 still left to pay on my home mortage.
     
  12. ~Candy~

    ~Candy~ Retired Administrator

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    12%????? Guaranteed? No risk? :D

    I'd like to know where ;) That's why he didn't go into detail.....he doesn't know where either ;)

    Of course there are stocks that you can buy and take the chance they go up 12% or more :)

    For example, a stock I purchased a while back at $10 went to nearly $15 in a matter of 4 to 5 months. :D

    Then again.........I've bought higher and watched them drop to single digits :eek:
     
  13. gotrootdude

    gotrootdude

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    AcaCandy, you let yourself lose money... Shame on you.
     
  14. Davec

    Davec Gone but never forgotten

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    It's SARSEP and that particular plan is no longer available. Pre-existing plans can continue but no new SARSEPS are allowed. We now have SEPS & SIMPLES for small business.
     
  15. ~Candy~

    ~Candy~ Retired Administrator

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    Buy Petsmart stock.............I've been there quite a bit lately :D
     
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