Investment income on the decline again

Don M. said:
With all this market volatility, and increasing sentiment about a coming major recession, I'm almost tempted to buy some Silver....precious metals may double or triple in price in a few months.
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Why do you think they may double or triple?
 

Note: IMO, beware people who will try to sell you all types of inflation hedges. I notice that with interest rates rising and stock and bond prices falling, the annuity sales companies are starting to brag about how nobody ever lost a cent buying an annuity from the Apple Pie Insurance company. Well, yes, unless one factors in inflation, sales charges, etc.

I am not anti-annuity. They have their place such as single premium immediate annuities (SPIA for short). But avoid complicated ones that you don't fully understand. And even SPIA's are subject to inflation's ruinous effects on investments.
 
rgp said:
Well, I'm down to just one stock @ this point. I have a meeting with a financial/investment advisor Thursday......so I'll let ya know.
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Well, I did meet with him yesterday. He advises, hold on to my one stock, partially due to the fact that I would face a serious tax hit if I sold it , and he feels it will recover value in the coming months ... maybe a year or more. Selling it for cash would cost me big time .

He is going to annalize my annuities , and let me know what he then advises .

He said just to leave my regular bank savings be .... they are what they are, and no one really offers any better.
 

Timewise 60+ said:
Federal Treasury Certificates rates go up when the economy goes down. They already have some attractive rates on 2 year T bills...check it out! No risk, unlike all other investments...
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Not quite ….

rates rise when the economy isn’t coming down and the fed tries to slow it down

we have very low unemployment and worker shortages and supply chain issues driving up inflation .

eventually when the economy slows and inflation comes down the fed reduces rates to avoid the mistakes Japan made
 
mathjak107 said:
Not quite ….

rates rise when the economy isn’t coming down and the fed tries to slow it down

we have very low unemployment and worker shortages and supply chain issues driving up inflation .

eventually when the economy slows and inflation comes down the fed reduces rates to avoid the mistakes Japan made
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Surely you know what I meant! Down was the wrong word, I should have said when the economy is failing, Fed rates go up!
 
Timewise 60+ said:
Surely you know what I meant! Down was the wrong word, I should have said when the economy is failing, Fed rates go up!
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the problem is so far we are not failing. that is why rates are rising ...it may not be good for assets but markets and the economy are rarely linked .

so far only one out of every 5 homes has even lowered their price .

the economy fails when unemployment goes up .

we have very low unemployment and big pressure on rising wages which is why the fed is raising rates .

how ever the fed cant fix the problems with rates for the most part .

we need more workers . we need more chips .... one third of the whole increase in the cpi is new and used car prices
 
the debt bubble is going to pop!
central banks...that includes federal reserve...are buying the debt for now...that's gonna stop...then it won't matter what you were investing in...wiped out!
 
bingo said:
the debt bubble is going to pop!
central banks...that includes federal reserve...are buying the debt for now...that's gonna stop...then it won't matter what you were investing in...wiped out!
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We are still the best horse at the glue factory .

the dollar is soaring and our dollars and bonds are in demand world wide.what ever the fed doesn’t buy is still snatched up world wide
 
rgp said:
He said just to leave my regular bank savings be .... they are what they are, and no one really offers any better.
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I learned this summer that with a tiny bit of effort we can do better with our savings by buying secondary Treasuries.

So for example, my plan was that every three months I would transfer money from my investment account to my bank savings account to last for the quarter, but my bank only pays .5% interest (annual rate), while instead I can buy a Treasury Bill for almost any little length of time that will earn five times as much interest. Of course there are a few days for settling and transferring but it still comes out as significantly more interest dollars.

The downside is more interest will mean more taxes but I'm still too new at all this to figure out when it would make more sense to leave it in a lower-yielding dividend-paying money market investment until I really need the cash in my bank account.

I'd gone into the Fidelity office last June and they taught me what to look at to make a buying decision, and it really just boils down to look at the Maturity Date, and the Yield to Maturity, and then if you aren't able to meet the minimum purchase (such as if it says 100 in parentheses in the Price/Qty(min) column, that means to get that rate of return you need to invest $100,000), drill down in the 'Depth of Book' column to find someone selling at almost that good of rate but letting you buy as few as you want (I learned this from the early retirement forum a few weeks ago).

For example, if yesterday I'd had $3000 that I want to transfer to my bank on Oct 15, I could have meanwhile used the money to buy THREE bonds that mature on Oct 13 that earn an as-if annual rate of 2.549%.

Treasuries.jpg

depth of book.jpg
 
Timewise 60+ said:
Federal Treasury Certificates rates go up when the economy is failing. They already have some attractive rates on 2 year T bills...check it out! No risk, unlike all other investments...
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There is no risk only if one does not include the effect of inflation. Assuming inflation remains where it is (I don't know if it will or won't) there will be a loss in real terms. Upon manturity you won't be able to buy as much as you did when you invested. That's a risk.

Treasuries may be the best deal around and better than the alternatives. I just want people to know that the value of their dollars - how much those dollars can buy - is at risk.
 
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bingo said:
the debt bubble is going to pop!
central banks...that includes federal reserve...are buying the debt for now...that's gonna stop...then it won't matter what you were investing in...wiped out!
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Wiped out! I think not.

Panicking is not a good way to limit the damage caused by inflation. And right now that is where we are, limiting the damage. We know inflation is hurting us and will continue to do so. How do we limit the damage so we can recover better in the future is the question.

Thankfully, the dollar is strong. That may help to cut a bit off of the inflation rate as we can buy more stuff from other countries compared to just a few months ago with the same number of dollars. It's not a cure for inflation, but at this point I will take all the help I can get.

Naturally, most of the above is just my opinion.
 
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Creek Pirate said:
If we are lucky, things may slow this down turn after Nov. but a complete turn around won't happen for about 3 years. best thing is become a little frugal and try to live on your fixed income and reduce selling your investments to allow them to recoup. Retirees are going to have it hard for awhile with high inflation and no / slow market growth
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looking at countries around the world who had inflation issues , it took anywhere from the 6 to 35 years to get double digits fit inflation back to 2% from double digits with an average of ten years
 
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mathjak107 said:
the problem is so far we are not failing. that is why rates are rising ...it may not be good for assets but markets and the economy are rarely linked .

so far only one out of every 5 homes has even lowered their price .

the economy fails when unemployment goes up .

we have very low unemployment and big pressure on rising wages which is why the fed is raising rates .

how ever the fed cant fix the problems with rates for the most part .

we need more workers . we need more chips .... one third of the whole increase in the cpi is new and used car prices
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Nothing like 'word smithing' with a 'beancounter' and/or 'math major'! So I move on...
 
rgp said:
Well, I did meet with him yesterday. He advises, hold on to my one stock, partially due to the fact that I would face a serious tax hit if I sold it , and he feels it will recover value in the coming months ... maybe a year or more. Selling it for cash would cost me big time .

He is going to annalize my annuities , and let me know what he then advises .

He said just to leave my regular bank savings be .... they are what they are, and no one really offers any better.
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I would run from anyone pushing annuities.
 
mathjak107 said:
The only annuities to consider are spia’s and those aren’t pushed …

you pretty much have to go buy them on your own since there is little in it for a salesman
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FWIW, even though it's not an annuity, is to delay social security as long as possible. Full COLA, 8% a year increase for every year its delayed and backed by the the guy who owns the money printing press.
 
Brookswood said:
FWIW, even though it's not an annuity, is to delay social security as long as possible. Full COLA, 8% a year increase for every year its delayed and backed by the the guy who owns the money printing press.
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It is actually an 8% increase off your fra amount each year . So it isn’t a compounded 8% increase each year .

It has zero return though until you make up the checks you gave up delaying , any spousal you didn’t get and any money that was spent down so you could delay .

So you may see zero return for as much as 22 years.

so one should never equate the ss increase to a return on investment
 
Brookswood said:
FWIW, even though it's not an annuity, is to delay social security as long as possible. Full COLA, 8% a year increase for every year its delayed and backed by the the guy who owns the money printing press.
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Delaying SS might be of benefit IF a person knew how long they will live. Waiting until age 70 to claim benefits is of little value if they only live to age 71, I signed up as soon as I became eligible, and my wife began receiving spousal benefits when she became eligible. Adding it all up, we've received several times what I paid in over my working career....wish some of my other "investments" were doing that well.
 
Don M. said:
Delaying SS might be of benefit IF a person knew how long they will live. Waiting until age 70 to claim benefits is of little value if they only live to age 71, I signed up as soon as I became eligible, and my wife began receiving spousal benefits when she became eligible. Adding it all up, we've received several times what I paid in over my working career....wish some of my other "investments" were doing that well.
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Well dead is dead …so game over .

the bigger question is what if I or my spouse live .

many need to defer to get larger survivor benefits for a spouse …

others have other sources of income .

so ss can be treated like buying a longevity annuity…there are loads of reasons one may delay , including spending down retirement money to avoid future rmds or Medicare surcharges .

others may be doing roth conversions or trying to get aca subsidies
 
To me, it makes sense to plan that either you and/or your spouse is going to live a long time. If you happen to both die young, who cares?

Of course if you need the money now, you need the money now.
 


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