Investment income on the decline again

Brookswood said:
I just read the Federal Reserve Bank is losing money. It seems their interest payments are higher than their interest income. Imagine that!

All I can say is that today's interest rates are just starting to approach the rates that I experienced for most of my life until 2008. IOW, we are getting back to a more normal interest rate environment. The War on Savers may be over, or at least we have a cease fire in place.
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You were better off at zero and low inflation then todays rates and 9% inflation
 
leastlongprime said:
Our Retirement Income is different from our Investments.
The retirement Income is increased 2022. The Income will likely increase again in 2023.
The Investments are highly variable and we do not depend on the Investments.
YMMV
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Care to expound on what ways your income is different than your investments? That is if it's not too personal and something you'd rather not expound on. Also I'm not familiar with the acronyms YMMV & YEMV. What do they mean?
 
I just hope we don't see a repeat of the conditions that occurred around 1980.....inflation hit almost 14%, and the Fed Funds rate hit 20%. Those with lots of money in the bank, back then, were probably cheering.
 
mathjak107 said:
he uses a lot of annuity income and complex annuity products
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Our Retirement Income consist:
We purchase market GLWB longevity annuities within IRAs that provide us with Income.
We also purchased SS Income for being employees.
Wife purchased a pension thru her job.
We purchased instruments that guaranteed minimum Income amounts and sold Investment risk to investors.

Our Non Retirement Income consist:
The Investments (IRA and non IRA) are volatile at the whims of my trading. I retain all the risks. The RMD's are reinvested into non-IRA accounts.

We also have a rental. Which kinda have aspects of an annuity and investments.
YRMV

Note: Hybrid annuities, of any type, need Detailed Due Diligence. Annuities (pensions, SS, Immediate, deferred) also need due diligence but are more straight forward in presentation.
YRMV
 
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Okay, I did some research on Deb's fund:
The Franklin Federal Tax-Free Income Fund offers an inexpensive way for investors to access a municipal bond portfolio.
As I think I explained on page 2, the value of the fund is inversely proportional to interest rates.
Simply put, as interest rates go up, the value of the fund goes down,
But, if you are looking at just the income from the fund, it should not change much.
 
Don M. said:
I just hope we don't see a repeat of the conditions that occurred around 1980.....inflation hit almost 14%, and the Fed Funds rate hit 20%. Those with lots of money in the bank, back then, were probably cheering.
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bowmore said:
Okay, I did some research on Deb's fund:
The Franklin Federal Tax-Free Income Fund offers an inexpensive way for investors to access a municipal bond portfolio.
As I think I explained on page 2, the value of the fund is inversely proportional to interest rates.
Simply put, as interest rates go up, the value of the fund goes down,
But, if you are looking at just the income from the fouund, it should not change much.
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The above fund is down about 6.6% this year. Not that bad compared to other bond funds, but not good either. It has a yield of about 2.8% that should be free of Federal income tax.

I would suggest comparing the net income of the above fund to doing something like buying a 5 year CD at about 4.7% (you can do that today) and paying taxes on the interest. You need to be in a very high tax bracket to take home more money with the Fund than with a a 5 year CD. And the CD will ensure you get all you money back when it matures.
 
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YMMV=Your Money May Vary,
YEMV= Your Everything May Vary

"Ymmv = your mileage may vary ….in other words you are on your own"
Sorta.
You are at the whims of someone/something else. The idea is, You, control who/what controls your retirement. Some use Golden Portfolio, PP, Stay the Course, 3 or 4 fund, multiple income streams, multiple classes. etc.
YMMV
 
bowmore said:
Okay, I did some research on Deb's fund:
The Franklin Federal Tax-Free Income Fund offers an inexpensive way for investors to access a municipal bond portfolio.
As I think I explained on page 2, the value of the fund is inversely proportional to interest rates.
Simply put, as interest rates go up, the value of the fund goes down,
But, if you are looking at just the income from the fund, it should not change much.
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If anyone only cares about the income and not what the fund is doing I will gladly pay you 1% more but I keep your invested dollars.

oh wait , I just invented the annuity
 
mathjak107 said:
If anyone only cares about the income and not what the fund is doing I will gladly pay you 1% more but I keep your invested dollars.

oh wait , I just invented the annuity
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Explain what you mean by "if anyone only cares about the income and not what the fund is doing". Also explain how that specifically applies to annuities vs any other types of investments.
 
C50 said:
Explain what you mean by "if anyone only cares about the income and not what the fund is doing". Also explain how that specifically applies to annuities vs any other types of investments.
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If a fund loses money year after year it doesn’t matter what the interest rate they are paying is ..total return is how investments are actually doing …

with an annuity you give them 100k and they give you an income as an example …if you die you lose what you gave them without costly life insurance riders .

if one has a fund paying a certain interest rate and one does not care about the share value then in effect they bought an annuity since They don’t care what their investment falls to.

retirement incomes are based on total portfolio value , not how much or how one decides to pull that money out
 
leastlongprime said:
Our Retirement Income is different from our Investments.
The retirement Income is increased 2022. The Income will likely increase again in 2023.
The Investments are highly variable and we do not depend on the Investments.
YMMV
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Our problem is inflation not our retirement Income. Our retirement Income has not gone down it was stayed the same. Yes, some stocks have gone down in value but the dividends has not.
 
There are lots of ways to generate retirement income.
leastlongprime said:
YMMV=Your Money May Vary,
YEMV= Your Everything May Vary

"Ymmv = your mileage may vary ….in other words you are on your own"
Sorta.
You are at the whims of someone/something else. The idea is, You, control who/what controls your retirement. Some use Golden Portfolio, PP, Stay the Course, 3 or 4 fund, multiple income streams, multiple classes. etc.
YMMV
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YMMV is a way of saying "What I am talking about works for me, but there are no guarantees it will work as well for you. Do you homework and due diligence and figure out if it might work for you."

Now-it-alls and loud mouths won't use YMMV often because they KNOW more about what is good for you than you do. And they are EXPERTS on EVERYTHING they talk about. YMMV is usually a sign of a thoughtful person who realizes that he/she does not know everything and cannot tell you what to do with any high degree of certainty. That's my take on this subject. YMMV.
 
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