On Tue, 26 Jan 2010 09:38:19 -0800, "Steve B"
wrote:


wrote in message
...
On Jan 26, 1:24 am, Hawke wrote:
Some of the less
perceptive insurance companies were publishing studies showing
that to be on the safe side, the typical couple should have about
1,000,000$ in savings when they retired. Just how is it possible
that the typical couple could accumulate 20 years of pre tax
income over even a 50 year working life? [20-70] especially with
*NEGATIVE* savings interest?

In that situation you have to do what they guy in the TV show Breaking
Bad does. You go into the meth business in your spare time. Other than
that there is no way to save yourself into financial security on 50K a
year.

Hawke

Actually you can save enough to have financial security on 50K$ a
year. It just requires that you start saving and investing early in
life. I don't think you can do it putting your money in a savings
account. But you can do it by having some money put in a savings
account every week. And then when you have a chunk of money, looking
for a good place to invest it. Right now I would be looking at buying
rental property and investing some sweat equity in managing the rental
property. Might be a bad idea in some parts of the country. But there
are lots of places to invest.

Dan

Reply: Instead of rental property, we do our two houses in Vegas as
vacation rentals. You can get twice the monthly mortgage in a week. Less
hassle than renters. Not for everyone, and location is everything. Check
out www.vrbo.com to skip around the world and see what types of houses you
can rent for your next location, mostly anywhere. The prices are very
reasonable, as most rentals have pots, pans, etc, and you just bring clothes
and food. Cooking in lessens costs, and makes it a more family vacation.
Many houses have pools, and that's better than swimming in the common hotel
pools. Not for everyone, but perfect for some. And a good money maker,
too.

Steve

================
This segues into a long running discussion in vocational
education called the individual/case v aggrigate/generic debate.

An expansion of this discussion can be seen at
Tussing, D. (1997 Fall) ECN 358 / WSP 358 Economics of U. S.
Poverty and
Discrimination. Syracuse University:
http://www.maxwell.syr.edu/maxpages/classes/ECN358/
http://www1.maxwell.syr.edu/uploaded..._CV.pdf?n=6060
http://www.gdrc.org/sustdev/causes-poverty.html

What this boils down is that what may work and work well for an
individual, or even a limited number of individuals, does not
work as a universal rule or for even a significant fraction of
the population.

High wage skills or high return investments depend on two
factors: (1) the market demand and (2) the supply. When either
factor is missing the value falls. For example, there may be a
market demand for CNC machinists, but if there are 10 qualified
applicants for every available jobs the wages will drop, possibly
to minimum wage because of the oversupply.

The same holds true for vacation house rentals in Vagas. If
thousands of people do this, the resulting glut will quickly
drive the rental prices down to less than break-even.

As for the suggestion that the individual invest in other than
government insured instruments such as FDIC savings account and T
bills, for a higher return, I suggest looking at the record,
including the banks and quasi governmental operations such as
Freddy and Fanny. Names like Enron, Silverado and LTCM also rise
to the top. see
http://www.bankruptcyresources.net/2...-bankruptcies/
http://www.dirjournal.com/business-j...went-bankrupt/
and
http://en.wikipedia.org/wiki/Savings_and_loan_crisis


Unka George (George McDuffee)
...............................
The past is a foreign country;
they do things differently there.
L. P. Hartley (1895-1972), British author.
The Go-Between, Prologue (1953).