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Old 10-04-2008, 01:31 PM   #1
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$2,451,854 at Retirement, for only $5,000!*

How to Give Your Child or Grandchild a Retirement Fund That Can Be Worth as Much as $2,451,854 at Retirement, for only $5,000!*

If I had young'un's, I would be doing this.

http://www.ricetrust.com/
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Old 10-04-2008, 06:26 PM   #2
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*Results based on $5,000 earning 10% per year compounded annually for 65 years. Calculation does not reflect any charges or fees that might be applicable; such charges or fees would reduce the return. This figure is for illustrative purposes only and does not reflect actual performance of any particular investment. Investment results fluctuate and can decrease as well as increase. Figures do not take into consideration time value of money or any fluctuation in principal. Funds withdrawn from the trust will be subject to income taxes at the beneficiary?s marginal tax rate at the time of withdrawal. Your tax liability may vary depending on your particular circumstances. Please consult your tax advisor. Funds cannot be withdrawn from the trust prior to the beneficiary reaching age 59?.
10% per year? For 65 years no less? Sorry, no!

While we were historically on track for such market gains since The Great Depression of the 30's, have you been paying attention to what's going on with the investment banks? Seriously, this bailout that was just approved by the house and senate is the same silly crap that they tried to prevent that depression. They have done nothing but delay the inevitable there. $5000 now will probably be worth about $5000 in five years from now. It might be safer stuffed under a mattress.
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Old 10-04-2008, 07:39 PM   #3
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secure your childs retirement?!?!?!? this is nuts.

although i do think now is the time to buy. ignore the fear mongering. you want to buy low and sell high.
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Old 10-04-2008, 07:54 PM   #4
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5000 that turns to over 2 million, in a matter of 50-60 years (depending on age of grandchild). do you know exactly how much crap you can buy today with a dollar that it was 60 years ago (1948).

also with these banks and investment firms going bad, and with all the job loss, ill much rather keep my money somewhere, where its liquid. I want to use my money when im in need, not to wait until im well in my 60's to retire and use it. ill much rather have fun young, than to have fun when im old, and haiving pain everywhere trying to enjoy life
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Old 10-05-2008, 04:19 AM   #5
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Originally Posted by civic94 View Post
wait until im well in my 60's to retire and use it.
You think you're going to retire in your 60's? Either you're 59 and wealthy now, or you're 25 and already have 200,000 in your 401k....
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Old 10-05-2008, 07:42 AM   #6
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I'm going to share with you the number one secret to long term financial security AND stability: Rental real estate investment.

Forget any get rich quick plans by flipping or over leveraging your equity to invest in multiple properties rapidly. It can be done, but it's a risky path and there are huge number of people sitting on homes right now or facing foreclosure who failed to anticipate the market and are now floundering in negative cashflow. What I am talking about is long term residual value that can be snowballed into something much larger if carefully managed - and paid for through the rent payments of your tenents.

We don't really give rip what our stock values are right now or what they will be in the future because it doesn't matter since we don't own any. What we do own is a single rental property (or at least have a fair amount of equity in). Our equity is enough that even a 50% occupancy rate is enough to pay the mortgage. We never have to feed it our energy or personal cash, and even with the current bust in housing prices, we have still seen the value of the property nearly double in the last seven years. Better yet, because we are able to carry the mortgage with such a low occupancy, we are also able to undercut the market on rents - allowing us to keep occupancy at over 95% on an annualized basis. Most of our tenents stay there at least 3 years, and the ones who are moving out at the end of this month already have a string of friends wanting to move in when they leave.

So why did I just tell you all of that? Because in the worst case scenario on average, there is only 5% of the year where we are not actually making any money on the property when maintenance costs are removed. The rest of the time it's a solid winner that exceeds what allot of more liquid and risky grouped funds usually return.

Sure, it can be a risky business if you don't know what you are doing, but you rarely get something for nothing, and if done right with a little knowledge and foresight, it can make you rich.
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Old 10-05-2008, 07:04 PM   #7
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Snax - my parents are securing their children's retirement with rental property. A commercial building they bought many years ago and is bought and paid for, has loyal successful business in the little strip mall. After the crazy taxes and replacement of aging items in the building its pure profit.

As far as rental residential - in my area people (owners of rental units) are really hurting right now. I'm glad I backed out of a deal a few months ago on purchasing a few rental condo units.

With any luck I won't have to have a full time job once I hit the big 4-0. We'll see how the economy is by then.......
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Old 10-06-2008, 07:14 AM   #8
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Well like I implied, 'smart' rental owners aren't over-leveraged and can maintain maximum occupancy by undercutting the market. Just one block down from our duplex, there is another duplex that has had one side vacant for more than 6 months now, whereas for our nearly exact duplicate of the duplex down the street, we already have an approved application in hand to replace the current renter. The difference: $100/month in rent.

Some landlords might insist that you end up with a lower class of tenent by charging lower rents, but that's more an issue of good screening than cost. I know millionaires who would haggle or blow an entire deal off over $100, and the tenants that are moving out of our property have actually improved it in many ways, so clearly that's less of a factor than some might assume.

Unless people are actually leaving the area, foreclosures drive up the demand for rentals and availabilty of viable properties to rent. We are now strongly considering upgrading to a property with more units as the number of rentals on the market seems to have increased lately. We just need to find one we like.

The other important thing about pyramiding equity into more rentals income is that it's better to focus on more units rather than more properties. I.e., instead of picking up random single family or duplexes all over town or even a relatively small area, overhead and management costs go down by concentrating the rentals into multi-unit apartments. I'm willing to bet that the rental owners having trouble in most places are simply chasing their own butts all over town to take care of things instead of keeping it all in one or two places and leaving it to property managers to handle.

Anyway, getting this a bit back on topic to compare it to the investment idea that started this thread, consider that in our local market, our equity has doubled in the last 7 years. Some of that is through appreciation, but a significant portion is also through mortgage prinicple reduction - paid for 100% by the tenants. Even if the stock market absolutely tanks, our portion of the equity in the property will continue to grow to the point where it or another property will eventually be owned outright - again, without us ever putting another penny of our own money into it.
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Old 10-06-2008, 09:51 PM   #9
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You think you're going to retire in your 60's? Either you're 59 and wealthy now, or you're 25 and already have 200,000 in your 401k....
I'm 53, and I figure I'll probably retire about the time my health gets so bad I can no longer work...probably about a week before I die....
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Old 10-07-2008, 07:32 AM   #10
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It's no coincidence that suicides historically rise with the duration of conservative governments. :P
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