Poor guy question

Well, I have to say SilverNoob, you have a pretty good grasp on your finances. I don't see that too often in someone as young as yourself.

...and $16 an hour isn't bad. That's about what my wife makes and she's +/- 40 with a masters' degree. (She's a librarian)

 

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that's absolutely ridiculous. there is nothing wrong with buying eagles, maples or common one ounce bars.

 

OK, FryDaddy, you buy 'em. That's less competition for the silver that everyone recognizes and accepts. Besides, I said ROUNDS, not eagles or maples, which are OK, even though they cost you some unnecessary premium. When used for their ultimate purpose, they're inconvenient to make change for, you will have to take dimes and quarters as "change," but will NOT recover your original premium, so why not just start with junk silver?

Bars, if you think you can pawn off bars from JimBob's Mint, go right ahead. The past two months, we have seen the first break in that dike, fake bars in the Northeast that changed hands a good many times before somebody recognized them for what they were. This is my final word on the subject in this thread, I'm not going to be drawn into a long pointless (and futile) argument.

 

It all depends on your goals, life choices etc. Here is what I do. Maybe, some of it might be helpful.

Investments:

0. Invest in yourself first. Get an education, update your skills. Learn something new. Petroleum engineers make 150K straight out of college, these days. I got a Masters last year, and currently applying to business schools for an MBA. Once I'm done with that, I should be able to switch jobs and make at least 20-30% more.

1. Put enough into 401K to get company match. 401K has very limited and usually terrible investment choices.

2. Put money into Roth IRA.

3. Put money into trading account. I work in financial services, so I know my way around trading. And trust me when I say, it isn't hard. Just spend some time reading, then get a practice account before you start playing with real money.

4. Put money into unconventional investments. My goal is to retire asap. I'm 26 now and aiming to retire by 45. I will invest in anything I think I can make money on. Startups, precious metals, options, real estate etc.

5. Think about starting a business. Remember that doing what everyone else is doing will never make you rich.

Spending:

1. Buy a house. Inflation is already as high as rates on a 30 year mortgage (real inflation, not the BS CPI numbers). It's like getting money interest free. In a few years, chances are that inflation's going to even start eating away the principal. But, remember to buy something well within your means without accounting for future raises, unless you're betting that house prices will go up a lot in the future. I bought my house for 1.6 times my annual earnings although my earnings will likely go up since I'm still only 26 and still in the beginning stages of my career.

2. Don't buy a car unless you really need one. Or, share one with the wife. I just use public transportation for the most part, but then again, I live in Chicago.

3. Live under your means. I try to save/invest half of my take home pay. I just feel uncomfortable when I can't.

4. Cut healthcare costs. Stop eating out and take that money and invest into healthy, organic, local fruits and vegetables. Think about how much money you will save in the long run by not getting sick. And think about how great your quality of life will be when you are older. You will actually have the health to enjoy the wealth you will have worked so hard to build. This is still work in progress for me. I grew up not having eaten a salad till I was in college. Huge fan of meat and all sorts of ethnic food. So, it's been a real struggle for me. But the benefits I think will be well worth the sacrifice.

 

that's fine if we all live in doug's fantasy land end times world, where we "make change" and everyone wants a mercury dime. the bars you're talking about were easily detected with a amagnet and the fact of the matter is counterfeit morgans are out there too.

 

Don't buy coins

 

:welcome:

I'm diverging from coins/silver a bit here, but a couple folks touched on it also. With you mentioning the comment above - PLEASE at some point soon seek out a good (and believe me there's plenty of mediocre and bad) eldercare/estate lawyer and get your soon-to-be MIL's house into a trust (along with other available assets), as well as the wills, Power of Attorney (legal AND medical) and advanced directives settled (ESPECIALLY if there's other siblings involved for your gf, or even you). You seem to have really good control of your finances and your plans, kudos to you sir, but also make sure to address these things while you still have good financial flexibility to compensate for any of the fees of doing all this now, as it can get very expensive to go through. But, once done, it's done and you will have peace of mind.

I was/am a single child, adopted so there was an almost 50-year gap between my parents and I. I used the phrase "I've got one set coming out of diapers, and one set going in" a lot. My mother currently has very late stage dementia/alzheimers, and my father is just old and debilitated. Several years ago we needed nursing care for them, and thus began the saga. Long story short, the money I thought they had, and I thought we'd have, went poof faster than you can say abra-cadabra. Lack of planning on my parents part, lack of knowledge on my part, and many lawyers later, we're finally almost settled. We never expected this, most people don't, and it really sent us on a roller coaster we didn't enjoy.

The roth IRA I think is a good idea, as when my parents needed money for the home, I took out funds from their normal, tax-advantaged IRA (had to, no choice). That came with an 18% withdrawal penalty above the yearly allowance, and at the end got hit with an almost $70k tax bill from Uncle Sam, since the government thought they "made" over $250k that year. The house was sold, going to medical expenses, and everything else they had went as well. Almost $750k "hard" assets gone within 5 years.

With proper planning and protection now, you can feel very confident and settled for later, and not have to worry about whatever nest-egg you're building today get wiped out having to care for relatives.

Back on topic - I personally keep my mortgage as-is, no plans to pay off early (low rate, 15-year), have 6 months living expenses in cash (in the bank, not under the mattress... ), have 6 months more living expenses in bullion in my SDB, contribute to my 401k to my employers match percentage (4% me, 4% them), and use my 401k as a personal loan to myself anytime I need a chunk of money instead of going to the bank (I pay myself the interest back to the 401k, instead of to a bank), and the amounts I'm taking are low, and paid back soon so there's no real risk to depreciation of the end projections).

For my silver habit, I buy mostly junk silver and have a thing for silver Ike's, Franklins and State Quarters, stacking probably about 10 ounces a month on average, depending on my hobby budget that month (which is last on the priority list, always). The coins satisfy both my interest in the coin collecting hobby, and the benefit of having the silver. I personally believe the silver is an inflation hedge - I'm not counting on being able to retire on it, and also it's "forced savings". In other words it's a hassle to convert the silver back into cash, so I buy it rather than keep cash around the house which I can dip into at any time to pay for things I really don't need. It's my "break glass in case of emergency" thing, so to speak.

Good luck to you, and most importantly - ENJOY whatever it is you want to do now (and if that means buying silver, then go do it). I'm married with kids now, and while I'd do it again without a moment's hesitation, I also do look back to the days I wasn't, and am glad I have good memories of that also.

PS - I'm kinda in agreement with that jelly bean story... :devil:

 

I would buy bullion coins and put them in a safe deposit box, or a piece of land that you can go to on the weekends.

 

Are you trying to say they don't fake 90%? :foot-mouth:

 

OP before I retired I had a 401b (similiar to a 401k) from a company that did not have a match for many years, but I did contribute the maximum amount I could afford. When I they finally reinstated the company match I boosted my contribution up to the maximum to get all the money I could from their plan. I did the same on my other jobs as well.

I told my kids to do the same and to invest it into the stock market. By the time my 25 yr old is ready to retire he can then start switching the funds into the bond market to preserve a portion of his long term capital gains.

One of the things you and your fiance sholuld also look into, is that by the time your m/l leaves the hourse to you, the value of the house may not be what you are expecting and if as a couple and own your own house then you can buy and sell you own home as you see fit. This could be especially prudent if you and your fiance want to have children. There is nothing like owning your own home when children are involved.

What you future m/l is suggesting may sound appealing but I do suggest that you and your fiance discuss this over on you own without outside input to sway you one way or another.

You could also use the 401k as a savings plan for the down payment on a house of your own.

You are at an age where the decisions you make today will influence your retirement years maybe 40 or more years down the road. Plan it out together.

But you should try and get rid of as much debt as you and reasonably do and live modestly. By all means.

edit: at this stage of you life coins and precious metals should be considered to be a hobby and not an investment program.

 

Hard to tell if inflation or deflation will win, but I would say that any kind of tangible asset, owned free and clear is a good thing.

 

When QE has added over $2 trillion to the money supply, and it's waiting to explode into the marketplace, it's hard to make a case for deflation.

And multiply that by every other major industrial country except perhaps China.