Horrible financial decisions

[Bandito440]

Originally Posted By: rjundi
Originally Posted By: CT8
Time share ! might as well take the cash and burn it.
Isn't time share nothing more then paying for something that in turn costs you more every year and worst can never get rid of since no one else wants it either?

Yes. I'd love to own the building and sell timeshares to other people though though. It seems like legal stealing.

Imagine if you paid for a timeshare with an early 401k withdrawal; money that's been taxed and penalized. It's like tripling down on a losing bet.

Originally Posted By: Vuflanovsky
I have to remember that bit about claiming 99 W-2 exemptions to help pay down 50K in credit card debt. There should be a financial "Darwin Awards" out there somewhere and that should definitely be nominated.

In fairness, the $50k credit card guy and 99 exemption guy are two different people. I think the 99 exemption guy had about $15k in credit cards. I'm excited to see how it all plays out. He was born overseas and has a house where he's from. I'm betting on him leaving the country before the tax man comes.

He once told me that his truck payment is $1,000/mo. I asked him what the interest rate is, but he doesn't know. I bet he got taken by one of those buy-here-pay-here places. The one locally is usually at 19% and has the occasional "sale" at 14.9%. I think it's a 2011 Sequoia Limited.

$50,000 auto loan for 6 years at 15% is about $1,000/mo. Yikes.

 

[JHZR2]

Originally Posted By: OneEyeJack
Worry not. The government plans to convert 401K's into government bonds and will soon institute a government mandated retirement plan for everyone that will capture the 3 trillion dollars in those 401K's and the 17 trillion dollars in annuities and other retirement schemes. The bill is in work right now. Our president has been explaining it for at least 5 years. This bill like others including healthcare will come to the floor for a vote at midnight on a Sunday where it will receive the attention (obfuscation) it deserves.

Link

With a federal budget out of control and all that cash in retirement accounts it's just too much of a temptation. Balancing the current budget is political suicide and on top of that there's not enough financial brain power in politics to manage a lemonade stand without a grant, a tax exemption and a bailout including wage and price controls.

Already your bank account limits how much you can deposit or withdraw without federal scrutiny. And your federally insured deposits, investment and saving accounts can be converted into bank securities at any time without notice.



That movie was quite the waste of time. The only "source" was the "national seniors coucil"?!? The video treats people all as idiots (which many may be uninformed), who know absolutely nothing about any of their accounts, and that the accounts are equally as opaque with information so people cant even find the fees.

Hopefully you can provide a more credible link when posting this stuff.

 

[javacontour]

If you have your nest egg in one investment vehicle, that's bad planning.

Diversification.

I recall the Enron crash years back. Some lost everything. Why? They put everything in Enron.

The only thing Enron employees were required to take in Enron stock was the employee match. Their 401(k) contributions could be in any of the other investment vehicles in the plan.

But some were greedy or short-sighted and put it all into Enron stock. Those were the ones who lost it all.

Originally Posted By: bullwinkle
Originally Posted By: javacontour
You didn't answer my question in the other thread. Unless the money you lost was in LB stocks and bonds, how did you lose? Did they not have SIPC protection and simply raided your account to cover their shortfalls?

If they did so, SIPC protection should have kicked in. It doesn't cover stock losses, but does cover the investment bank raiding your account for their survival or other purposes.

Originally Posted By: OneEyeJack
Originally Posted By: surfstar

So...
I'm guessing you don't contribute to or have a 401k or IRA, then?
How's that gold buried in your backyard doing?



I did contribute. I followed all the rules and advice. It was all with Lehman Brothers, the 3rd largest bank in the world and it went up in smoke. But don't worry. The institutional investors like Goldman Sachs were protected as were the Lehman Brothers executives that faced no criminal charges and often transferred into government jobs including one Cabinet level position. The politicians told us they were too big to fail so ordinary citizens absorbed the loss. Imagine that.

Tell me, what are the fees applied to your 401K? Ask. See if you get an answer. Does the judgment in the United States Court of Appeals for the Eighth Circuit in St. Louis interest you? I had to do with fees and it took years to sort through all the fees that are charged in 401K plans.
If he had it all in Lehman stock, he likely got burned. I had relatives that lost a nasty chunk in GM stock-thought it could never go under-WRONG!

 

[supton]

Originally Posted By: Cutehumor
Originally Posted By: Astro14
For the record, I've borrowed heavily against my 401(k). The max of $50K, in fact. I don't consider this to be a horrible financial move. I didn't use it for a car, or consumer spending.

I used the money to pay my children's tuition as it was the cheapest interest rate I could get to cover those costs.


I'm almost 38. I have a 3 year old and a newborn son. I thought about saving for college for them, but the financial guru Suzy Orman say to save for our retirement first. College tuition saving for kids is good if you have the extra money, but there will always be college loans/working/work study for them. With inflation, if you take from your 401k to pay for kids college tuition, you might run out of money for yourself in retirement. I am scared social security and medicare won't exist anymore in 30 years. I have to factor that in my financial retirement decisions.

My financial goals are to save as much as I can in my 28% contributions in my roth 401k and my max roth IRA contributions. I intend to pay our 30 year home loan in 15 years by making extra payments. I think when my kids go to college. If I am financially able and still physically able to work, I might take home equity loan to pay for their college. I just have to see how the state of our economy is in 2031.


Same age as you, vastly less going into my retirement, kids are 8&10. I have some hope of paying my house off in ten years and then saving for college, taking that mortgage payment and saving that instead. But I kinda hope they take loans so as to have some skin in the game--maybe I will help pay them after college, but the last thing I want them to do is go off and party on my dime.

I kinda hope my wife goes back to work in a couple years--sometimes I justify my loans against the thought that in a few years our income will easily cover that. Probably short sighted but we very much like having her as a stay at home mom. Although we do toy with homeschooling, and if we do that then I am not sure what we do on the vehicle front just yet, as that is a huge expense for us.

 

[hattaresguy]

A number of my renters have up to $70k in CC debt, and up to $500k in student loans. If you look at my parking lot its also full of very nice European cars, all within a year or two old.

Some people live for the day, some live for the future. That's fine if any of them ever get their financial house in order I'd happily sell them a real house!

 

[Bandito440]

Originally Posted By: JHZR2
Originally Posted By: OneEyeJack
Worry not. The government plans to convert 401K's into government bonds and will soon institute a government mandated retirement plan for everyone that will capture the 3 trillion dollars in those 401K's and the 17 trillion dollars in annuities and other retirement schemes. The bill is in work right now. Our president has been explaining it for at least 5 years. This bill like others including healthcare will come to the floor for a vote at midnight on a Sunday where it will receive the attention (obfuscation) it deserves.

Link
With a federal budget out of control and all that cash in retirement accounts it's just too much of a temptation. Balancing the current budget is political suicide and on top of that there's not enough financial brain power in politics to manage a lemonade stand without a grant, a tax exemption and a bailout including wage and price controls.

Already your bank account limits how much you can deposit or withdraw without federal scrutiny. And your federally insured deposits, investment and saving accounts can be converted into bank securities at any time without notice.



That movie was quite the waste of time. The only "source" was the "national seniors coucil"?!? The video treats people all as idiots (which many may be uninformed), who know absolutely nothing about any of their accounts, and that the accounts are equally as opaque with information so people cant even find the fees.

Hopefully you can provide a more credible link when posting this stuff.

It's just fearmongering by the usual Internet sources. There was an attempt several years ago to require businesses without pensions to offer IRAs, although employee participation would be optional. I think that's a great idea.

That was turned into government seizure of funds by the usual internet conspiracy knuckleheads. I wish folks would check their sources before presenting that kind of nonsense as fact.

 

[Vikas]

$500K in student loans? They must be physicians