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## Because America doesn't want you to save...

Mundane & Pointless Stuff I Must Share: The Off Topic Forum

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cthulhu
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Post by cthulhu » Tue Feb 22, 2011 1:30 pm

It's still higher than long term returns if you bought the S&P index and held.
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Koumei
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  Location: South Ausfailia

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Post by Koumei » Wed Feb 23, 2011 6:48 am

The other day, there happened to be two ads on TV that... well, one after the other, it was either hilarious or terrible.
The first was how gambling pisses away all your money and hurts everyone around you - call ____ for help to stop gambling.
The second was how everyone's retirement fund is fucked after the GFC and we were all stupid for trusting these people instead of stuffing it into mattresses or something. (I believe it was *actually* "Now try investing in US, because WE won't topple over like THEY did!")
It's almost like Channel 10 were giving a message.

> Count Arioch the 28th wrote:There is NOTHING better than lesbians. Lesbians make everything better.

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tussock
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Post by tussock » Sat Mar 05, 2011 11:42 am

Pay off all your debts. All of them. Do not go into debt again. Doing so is the best investment you can ever make. Debt is for your limited liability shell companies so you can steal the investor's money without them knowing, not for you personally.
Pay your mortgage faster. If you can't, buy a smaller fucking house to get a mortgage you can pay off faster. Next time house prices tank, get a bigger house again, if you must. Do not rent, unless doing so is the only way to buy. You should finish your mortgage in ten years, and even that will cost you 60% extra. Paying compounding interest is for fools.
Look after your house, fix everything the day after it breaks, paint it regularly, keep the roof in good order, care for the electrics and the pipes. Pick an insurance company that reduces premiums over time for good customers. Maybe invest in that insurance company.
Buy a tiny, reliable car that's been around a while, one that lots of other people drive. The smaller you can survive with, the better. Sell your truck, rent one for the two days in the next year you might need it. If public transport is available for work, do without owning a car, renting ten days a year is far cheaper than owning.
Beware that your brain pays the same attention to a $100 purchase as it does to a $100,000 purchase. It thinks a 10% saving on the first matters just as much as a 10% saving on the latter. Do not listen to it. Do the math.
The stock market is shit, but you can buy stocks in the things you use on a regular basis and you'll normally see the company failing before the computers do and have time to get out. Real stocks fail all the time, so diversify and don't sweat the losses. Talk to people who work in the things you invest in.
Whatever the government gives you tax breaks on can seem awesome, but it's usually all a scam, because the people who end up with your money made a lot of "contributions" to get those tax breaks passed, and they will steal all your money to make up for that. Anything you can't get your money out of for forty years is bullshit, it's just not going to be there; they can say they're giving 9% all they like if you can't actually get at that money yet.
If you have real money, hundreds of thousands to throw away, try to think of something that will be producing real value in thirty years time (like maybe a wind farm or something else that doesn't need fuel prices to be sane, being aware that everything needs regular recapitalisation on that time scale) and help build it from the ground up. Don't forget insurance, the expensive stuff that actually pays.
+4%pa compounded monthly for 30 years is 331%.
+6%pa compounded monthly for 30 years is 602%.
+8%pa compounded monthly for 30 years is 1094%.
Every percent matters, a lot, but only if you keep compounding it, which in reality means finding many more things to invest in over the next thirty years, which is hard. Companies that promise to compound for you need to be physically growing by that much or it's all lies, so beware.
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