Okee Dokee guys/gals/others....what should I do with my money

[Heddi]

Serious question...

I'm 32, Mr. Hed is 35.

We earn about $130k a year, give or take depending on how much OT I work

We have a fully paid off car.

We don't own any property--we're renters because we're nomads and can't stay in one place for more than 2 years (typing this as I just passed the 7 year mark for living in Seattle)

No kids

No debt (well, 8k on student loans, but I could pay that off tomorrow if I wanted to, I just don't want to :) )

Right now, have $30k in the bank as savings.

No retirement plan to speak of other than just chucking money into the bank every week or two.
--

However, I know that time is fast approaching where I'll be old and feeble and can't do the things I like to do (furry porn, anyone??), and will need some kind of retirement.

With the markets being as bad as they are, I don't think this is the best time to go day trading.

I'm an economic planning imbecile. Both of our companies offer 401k's, but I don't like the idea of an Enron-type situation occuring. My understanding is that IRA's let you put money away, but you can't "get to it" if you need to, like, in case we wanted to buy a house in the next 3 or so years and wanted some cash for downpayment.

My thought is that we should put our money in CD's for the time being---we earn interest, and we can get to it relatively easily if we need to. They're FDIC insured, right?

At any rate, I'm not one to gamble with my moolah. I work hard for it and I don't want it to go Poof! one day and be gone. I also want to have the flexibility to access prior to being 75, basically.

You all seem like pretty rational and intelligent folks---any suggestions? I don't trust financial planners to tell me anything other than what I should do to generate the most comission on their part, and I'm wary of all that fine-print bullshit as well....

[cosmik debris]

1. You need a professional financial adviser.

And you should be aware that a period of rampant inflation is probably right around the corner.

If your savings don't grow at a rate faster than the inflation rate combined with the taxation rate, you lose value.

I would also suggest that you find a retirement calculator to see what your future will look like if you don't take care to beat inflation. Here is one, but there are many on the internets.

http://www.massmutual.com/mmcalcs/RetirementPlan.html

Find a professional that you trust. Explain your need for security and liquidity. And don't be afraid to dump that professional if they don't give you what you want.

Consider how you might advise a person with health concerns. You would probably advise them to find a professional that they trust and communicate all their concerns to that professional.

(Note: I speak from the perspective of a person who retired at age 53 thanks to a good professional financial adviser.)

Edit: A couple of points I thought of later.

If you don't have a ROTH IRA you are nuts. Period.

Would you go to the internets for health care advice? Or would you go to a professional health care expert. Asking for financial advice from people you met on the internets is like asking for health care advice from people you met on the internets. Think about it.

[TZ]

2. I second CD...Roth IRA is supposed to be great

I don't have one (can't afford more than my standard 401 K right now..which I won't look at right now..considering its mostly higher risk stocks)
and find a GOOD financial advisor..make sure they have a good reputation..I've heard some horror stories...

[realisticphish]

4. I have a Roth IRA

granted, it has 100 bucks in it, but I plan on starting to actually deposit money once I get a job that pays more than minimum wage.

[Heddi]

5. oh, obviously I'll talk to an advisor

I just wanted to know if anyone had any, I don't know...not so much "advice" but "this may be an option that many people don't think of" type of thing.

I'd never do anything that I read about off the internet, if that makes sense.

Tell me about a Roth IRA while I figure out a planner to go see. Also, the part about Inflation---I know inflation is bad for wages and value of groceries, but does that mean that it's a bad time for starting up a retirement fund in whatever means I come to?

[cosmik debris]

6. Pick an independent adviser,

Not one affiliated with a bank or provider of other financial services.

I am currently with Raymond James Inc., but the important relationship is the relationship with the person who handles your account, not the company.

The reason ROTH IRAs are good is that all of the interest or dividends accrued are TAX FREE! The draw back is that you can't touch it until you are 59 and a half years old. (Without substantial penalty)

Inflation is also really hard on savings accounts. If your savings is drawing 3% interest and the inflation rate is 3% YOU LOSE. You lose because you have to pay tax on the interest and your net yield is less than you started with.

But this is still a great time to start saving for retirement. The oldest and most reliable financial advice ever given is "Buy low, sell high." Right now the market is low and there are a lot of bargains out there for long term investors. This might not be the perfect time to buy, but the perfect time is not too far off. And that's why you need a pro!

[varkam]

3. You should give it to me so that I can pay off *my* student loans!

Ha! Kidding.

Seriously, though, I would second what Cosmik said and find an adviser. We're all intellectually hawt here and stuff, but it is your money we're talking about.

[razors edge]

7. Get the 30K

and find a coin dealer. Gold is real money, they can't devalue it as they will all paper.

Then study more on the choices you have, as you learn more about your options, the gold is just sitting there waiting. It did not loose value, it did not gain value, the dollar may have but it wasn't the gold that changed.

Silver, platinum, even lead in small round ingots mounted in brass casings that travel in a rapid manner can be considered precious metals.

[cosmik debris]

8. The price of gold dropped $25/ounce in 4 hrs this morning n/t

[dropkickpa]

9. *snort*

Don't break it!

[realisticphish]

11. wah wah waaaaaaah nt

[razors edge]

13. BUY! n/t

[cosmik debris]

15. You said "It did not loose value,"

And yet it lost $25/ounce in 4 hours.

The facts prove you wrong.

[razors edge]

18. It didn't loose value.

Gold didn't change in value, the dollar did.

If thats too hard to comprehend, I'm sorry.

[cosmik debris]

20. So, how do you measure the value of gold?

Ounces per toga?

:rofl:

[razors edge]

21. Beats sewing dollars together.

[cosmik debris]

22. You're not making sense.

The monetary policy you espouse has been discredited for a century.

Even the Republicans have caught on by now.

[razors edge]

27. Keynesian soft money is holding up so well

that it just needs bailing out now and then with the savings of the poor. And the Hard money policy that ruled the planet before it for time nearly immortal has been discredited by this failed ponzy scheme. I think I'm catching on to your thinking.

[cosmik debris]

29. Hard money only works in a barter economy

And the chances of a billion people regressing to a barter economy is so slim that it is preposterous.

You seem to be living in a delusion where the world ends and only those with soft yellow metal can barter for food.

I hate to break it to you, but cash is here to stay.

[razors edge]

33. No shit Sherlock.

How about backing that paper with something of value.

[cosmik debris]

34. Well, DUH!

It is backed by the full faith and credit of the Government of the United States.

It is back by the taxes of two hundred million tax payers.

Are you really paranoid enough to believe that the taxes of two hundred million tax payers has no value?

Geeze, you are living in a delusion.

I'll bet you are one of those who think the IRS and the Federal Reserve are unconstitutional. :rofl:

[realisticphish]

35. maybe it's me

but i'm detecting the influence of the good Dr. Paul

[cosmik debris]

36. He'll give up soon

He has to catch the last train back to Wooville.

[realisticphish]

37. some say

his supply of gold ingots grew three sizes that day...

[TZ]

38. This has been enlightening

I've never encountered an economic woo before!

[cosmik debris]

39. It's not complete until we get the lectures on the Admiralty Court

and the unconstitutional IRS and Fed. From there it is just a short hop to the international banking conspiracy and--you guessed it--JOOZE!

[TZ]

40. huh. well you know

I don't really know much about that..despite being one of teh evul JOOS types. I've got to work harder to keep up with my world domination. I've been too busy trying to stave off some brilliant young internet warrior who uncovered our hand in sinking the Titanic....:rofl:

[conscious evolution]

42. admiralty court--Damn you to hell!!

I thought I had that phrase deleted from my memory and there you go digging it up for me.

I once had a nieghbor,who made me look like the poster boy for good mental health,who would go on and on and on and on about that crapola.

I have to go wash my brain with highly corrosive chemical cleansers now.Anyone have a cup of hydrochloric acid I could borrow?

[WoodrowFan]

43. fringes!

OMG! That flag has a FRINGE!!!!!! :scared:

[Anarcho-Socialist]

44. those bankers get everywhere

I've seen posters on DU alleging that communism, the Soviet Union and the Eastern Bloc were all fronts for those international bankers as well.

[Anarcho-Socialist]

24. Yes it did

Gold does not (and cannot) stand on its own as something which can measure its own value against itself. For currency to operate it must be measured against goods, services, commodities, property.

The value of gold dropped against other commodities.

[razors edge]

31. "Gold does not (and cannot) stand on its own"

History shows otherwise.

"For currency to operate it must be measured against goods, services, commodities, property."

And this one 3% move downwards shows gold or silver has no monetary value, is that what you are saying?

Do I have to break down the finer points of goods, services, commodities, property and their respective valuations in relationship to the dollar trading somewhat higher against precious metals or the Euro?

Domestic goods, services and property move independently of imported commodities to a large extent. the price increase for a loaf of bread takes time to factor in higher fuel import costs involved in production. But eventually you will see that increase. The surge in the dollar was based on the anticipation of government intervention in the stock market. If this intervention fails to materialize, what do you think will happen to the short term value of the dollar vs gold?

What is even worse is the fact that short of funding this bailout with loans from Asia, (did anyone even bid on their last auction, I haven't heard much about that) the Fed will be left with the task of increasing the M3 to cover this handout, and the resulting inflation will be massive. That combined with the Fed tightening the credit supply and you have the next great depression.

Even if they inject the 700 billion in the market, so what? The Fed handed out that much last week to the banks and they are still fucked. Wait till the derivatives come home to roost.

[Anarcho-Socialist]

32. "...is that what you are saying?"

Er... no. I don't know how you deduced that from what I said. Go back and read again.

[PVnRT]

16. PWNT

:thumbsup:

[realisticphish]

10. precious metal has no objective value

its value fluctuates with demand like any other currency.

[razors edge]

12. Keep telling yourself that

as you spend your inflated dollars.

Two thousand years ago an ounce of gold would buy you a new toga, belt, and a pair of shoes. At $850/ounce, you could go out and buy a new suit, belt, and a pair of shoes.

Hows the dollar held up in comparison to this standard with no objective value?

[TZ]

14. umm last I checked its NOT 2000 years ago

Thinks are a little different now.
And I don't know ANYONE who has ever made any money on metals. In fact my gullible sister just SPENT 2,000 to invest in some damn "gold club" money that should have been spent on an overdue mortgage actually.

[razors edge]

17. "Thinks are a little different now."

Not really, except the nuclear bombs and graphite golf clubs. The fiat currency system is one of the oldest wealth pumps ever devised.

I got 10 ounces three years ago at 520/ ounce, you can do the math. If I had more money I would be buying now. The market is artificially low even at 875/ once. Every day the Queen's Bank, and others, dump gold onto the Asian markets to keep the price low, but go to a local coin dealer and ask him how hard a time he's having maintaining inventory. When the controls break down, along with the markets, Gold will end up around 2000/ ounce or more.

I recommend Swiss Francs, five make one ounce, numismatic is not taxed if it goes up in value and you sell it at a profit.

Do you think the big holders of Confederate bills ever thought it would be worthless?

[WoodrowFan]

19. but, but, but

but Randi Rhodes advertises buying gold on Air America!

[Anarcho-Socialist]

25. you've proven realisticphish's point

Gold has no objective value. At that moment in time you expressed the value of gold as being worth the same as 'a new toga, a belt and pair of shoes.'

The supply, availability, production, desirability and demand of clothing will affect the quantity of what currency you pay for it (whether dollars or gold). In periods of scarcity and high demand, the amount of currency which you will need to lay down will be higher and this would include gold standard currency.

In Early Modern Europe, Spain became bankrupt and its economy collapsed despite having huge amounts of gold in circulation. You might want to study why this happened and you might learn something about the topic.

[realisticphish]

26. you don't understand

perhaps it is more stable, but it HAS NO OBJECTIVE VALUE. It's shiny. That's it.

Oil has objective value. Iron, lumber, flint if you happen to be ancient hunter gatherers, those have objective value because you can do things with them. Gold is pretty, it has no real use (yeah, audio cables, but that's hardly a basis of value), so how in the world does it have value?

BECAUSE WE GIVE IT VALUE. Because other people want it, because other OTHER people want it, ad infinitum.

[TZ]

28. Whats even funnier is its such a soft weak metal

Objectively its fairly useless except for a few different applications..but there are much better metals for most things...

[realisticphish]

30. yeah

iron and even copper can be used to make tools. Gold can be used to make jewelry :shrug:

[PVnRT]

41. It's also a good electrical conductor

Fairly resistant to most acids, except aqua regia.

[Anarcho-Socialist]

23. "Gold is real money, they can't devalue it as they will all paper."

Gold of course can be devalued. If gold was dumped on the world market it would be devalued. If gold was excessively extracted and supplied to the world market it would cause the devaluation of gold. If the possession of, and attraction of gold fell out of favour for reasons of fashion and culture, it would of course be devalued.