Jason L.
Second Unit
- Joined
- Jul 12, 1999
- Messages
- 483
I wanted to get some feedback from the HTF regarding a new phase of my financial life.
I am 33 3/4 years old. I have never been married and have no kids. Pretty much zero responsibility – not even so much as a Chia Pet! I have been overseas working in Kuwait and Afghanistan for over 2 years. The money I have made here has forced me to re-think my plans as I have gone from Spender/Saver to Major Saver. I need help with short-term and long-term strategy.
The Breakdown
I currently have [$60,439] amount sitting in an Orange ING Savings account earning 2.60 percent that I haven’t figured out where to put.
I wanted to create an “emergency savings” stash – like every financial planner recommends, and I wanted to maximize the earnings. I have started putting $1000 each month into a 5-year CD with Orange ING. Eventually I would have $60,000 saved [5 Years x 12 months x $1000] saved and hopefully it would never be touched. Since a new CD would be renewed each month, the interest rate would rise and fall and match whatever the current rate is. Currently my CDs are earning 4.00% – 4.25% and the total amount so far is $8,000 [8 months x $1000]
I currently have [$5,342] amount earning nothing which will stay that way for the time being.
Total [$73,398]
I have a contract that ends in late August of this year. If I complete the contract [and I don’t see why I wouldn’t] that total would probably be at least $125,000. I live the life of a monk out here, and there is only so much you can take. If I can stay an additional 6 months, I might be able to save close to 200k.
I have a Secret Clearance, which is the only thing that separates me from being another mediocre, unemployed, System Administrator back in the US. I have no idea how long I will do this type of work. I could move on to other overseas positions, get a position stateside, or do something entirely different. I will definitely be taking A LOT of time off [perhaps more than a year] once I leave here.
I have a condominium back home that is fully paid off, and I could get $105,000 for it. That amount is what I would get for it, not what I would be asking.
No car payment. Car sits in garage collecting dust and is worth maybe 2-3k.
No other debts.
The only mandatory expenses I have right now are property taxes [$2,100 for 2004] and HOA dues for the condo [$219/month or $2628/year] – for a total of $5,728 for 2004. These have already been paid off, and I won’t have to pay them again until the end of 2005.
I have somewhere between 15-16k in an IRA. I have already made the maximum contribution for 2004 [$3,000] and 2005 [$4000]. My current employer has no retirement savings plan. I have not paid my taxes yet, but I should owe roughly $1,200.
I have a degree in Math/Economics. I have subscribed to BusinessWeek magazine since I was 15. I worked on a stock trading desk and in the back office for two discount brokerage firms many years ago. All this means that I am not afraid of making my own decisions [although I am very rusty as in the past I concentrated on paying off my mortgage as quickly as possible]. I have no fears about picking individual stocks, if I choose to. It also means I have a MAJOR distrust of any financial consultants, advisers, retail stockbrokers, etc. I believe that they are always much more interested in making money off of you, than making money for you.
I am quite frugal [must be my ¼ German blood]. I don’t spend money on $9 Chocolate Martinis, 70$/month cell phone bills, 6$ Frappuchino Lattes, or $400/month car leases. I have no vices other than free Internet Porn. I can’t see myself blowing my money away. I like to put my money in things that appreciate than things that depreciate.
While am overseas, I don’t have the ability to make complicated transactions – ex. sell my condo.
Short Term Thoughts:
1.I have only had the Orange ING account since August. I have been adding to it every two weeks. While it is a good short term place to park my cash, I am at the point where I am looking for better than 2.60%. I was thinking of putting it in some sort of Vanguard Index Fund – possibly their S&P 500 fund or combination of other Index Funds.
I have heard people give rave reviews to the book “The Coffeehouse Investor”. While I haven’t read it, I generally subscribe to their way of thinking – which is to invest in Index funds over a range of stock and bond funds with low fees because almost all market gurus cannot beat this performance over the long term. Don’t worry about beating the market and take time to enjoy life.
2.I’m not sure on whether to get rid of my “CD Ladder Theory” already. First, it will take another 4 1/3 years to fully fund this. It is also somewhat burdensome having to go through all this maneuvering. 4.00% – 4.25% isn’t that great. I’m sure there are some municipal bond funds that do better than this. I think there are some stocks that have dividend yields around this amount. Since I am very frugal, I’m not sure if I see myself needing a separate “emergency cash” fund. If I were to put this in some Vanguard fund(s), I could always take out cash if I needed it, right?
Long Term Thoughts:
1.I am not a big fan of working. I try to do as little of it as possible. I want to put in my 40 hours and take off. I have no desire to be a manger or be responsible for anything. I generally feel that most Americans lead very unhappy lives in their miserable little jobs they hate while getting a sorry-ass 2 weeks a year in vacation where they are stressed out trying to cram in as much stuff to make up for this sorry amount. I could go on about this, but see either Gary Dee, Patrick Swayse’s rant in Point Blank, American Beauty, or Fight Club.
So that is why I am overseas. To get a little taste of adventure and save big bucks so I am not indebted to “THE MAN” and do whatever it is I want to do.
I feel like I have been given a Golden Opportunity to do something with this money so I can set myself up long-term and let my money work for me while I continue my Peter Pan-like existence - To avoid being another working schmuck.
I don’t want to open my own business because of the commitment involved and the fact that I have seen so many businesses go bankrupt.
The only investment vehicle [besides stocks, etc.] I see worthwhile is rental property because of its tremendous leverage. Dallas isn’t a sellers market – the demand isn’t that great, houses are cheap, and there is plenty of land to build on. I would have to look for “tight” rental markets like NYC/Boston, DC/Northern Virginia, West Coast, etc. There are certain areas where you could rent out a doghouse and people will rent it because they have no choice. I would need to hire a property manager because I don’t plan on doing any work myself. There are some inherent risks to rental property, however:
a)It is not a liquid investment.
b)The housing bubble could collapse – although I wouldn’t be doing this for several years from now.
c)House ownership is at an all time high.
d)Trouble renting the place outbad tenants
I am 33 3/4 years old. I have never been married and have no kids. Pretty much zero responsibility – not even so much as a Chia Pet! I have been overseas working in Kuwait and Afghanistan for over 2 years. The money I have made here has forced me to re-think my plans as I have gone from Spender/Saver to Major Saver. I need help with short-term and long-term strategy.
The Breakdown
I currently have [$60,439] amount sitting in an Orange ING Savings account earning 2.60 percent that I haven’t figured out where to put.
I wanted to create an “emergency savings” stash – like every financial planner recommends, and I wanted to maximize the earnings. I have started putting $1000 each month into a 5-year CD with Orange ING. Eventually I would have $60,000 saved [5 Years x 12 months x $1000] saved and hopefully it would never be touched. Since a new CD would be renewed each month, the interest rate would rise and fall and match whatever the current rate is. Currently my CDs are earning 4.00% – 4.25% and the total amount so far is $8,000 [8 months x $1000]
I currently have [$5,342] amount earning nothing which will stay that way for the time being.
Total [$73,398]
I have a contract that ends in late August of this year. If I complete the contract [and I don’t see why I wouldn’t] that total would probably be at least $125,000. I live the life of a monk out here, and there is only so much you can take. If I can stay an additional 6 months, I might be able to save close to 200k.
I have a Secret Clearance, which is the only thing that separates me from being another mediocre, unemployed, System Administrator back in the US. I have no idea how long I will do this type of work. I could move on to other overseas positions, get a position stateside, or do something entirely different. I will definitely be taking A LOT of time off [perhaps more than a year] once I leave here.
I have a condominium back home that is fully paid off, and I could get $105,000 for it. That amount is what I would get for it, not what I would be asking.
No car payment. Car sits in garage collecting dust and is worth maybe 2-3k.
No other debts.
The only mandatory expenses I have right now are property taxes [$2,100 for 2004] and HOA dues for the condo [$219/month or $2628/year] – for a total of $5,728 for 2004. These have already been paid off, and I won’t have to pay them again until the end of 2005.
I have somewhere between 15-16k in an IRA. I have already made the maximum contribution for 2004 [$3,000] and 2005 [$4000]. My current employer has no retirement savings plan. I have not paid my taxes yet, but I should owe roughly $1,200.
I have a degree in Math/Economics. I have subscribed to BusinessWeek magazine since I was 15. I worked on a stock trading desk and in the back office for two discount brokerage firms many years ago. All this means that I am not afraid of making my own decisions [although I am very rusty as in the past I concentrated on paying off my mortgage as quickly as possible]. I have no fears about picking individual stocks, if I choose to. It also means I have a MAJOR distrust of any financial consultants, advisers, retail stockbrokers, etc. I believe that they are always much more interested in making money off of you, than making money for you.
I am quite frugal [must be my ¼ German blood]. I don’t spend money on $9 Chocolate Martinis, 70$/month cell phone bills, 6$ Frappuchino Lattes, or $400/month car leases. I have no vices other than free Internet Porn. I can’t see myself blowing my money away. I like to put my money in things that appreciate than things that depreciate.
While am overseas, I don’t have the ability to make complicated transactions – ex. sell my condo.
Short Term Thoughts:
1.I have only had the Orange ING account since August. I have been adding to it every two weeks. While it is a good short term place to park my cash, I am at the point where I am looking for better than 2.60%. I was thinking of putting it in some sort of Vanguard Index Fund – possibly their S&P 500 fund or combination of other Index Funds.
I have heard people give rave reviews to the book “The Coffeehouse Investor”. While I haven’t read it, I generally subscribe to their way of thinking – which is to invest in Index funds over a range of stock and bond funds with low fees because almost all market gurus cannot beat this performance over the long term. Don’t worry about beating the market and take time to enjoy life.
2.I’m not sure on whether to get rid of my “CD Ladder Theory” already. First, it will take another 4 1/3 years to fully fund this. It is also somewhat burdensome having to go through all this maneuvering. 4.00% – 4.25% isn’t that great. I’m sure there are some municipal bond funds that do better than this. I think there are some stocks that have dividend yields around this amount. Since I am very frugal, I’m not sure if I see myself needing a separate “emergency cash” fund. If I were to put this in some Vanguard fund(s), I could always take out cash if I needed it, right?
Long Term Thoughts:
1.I am not a big fan of working. I try to do as little of it as possible. I want to put in my 40 hours and take off. I have no desire to be a manger or be responsible for anything. I generally feel that most Americans lead very unhappy lives in their miserable little jobs they hate while getting a sorry-ass 2 weeks a year in vacation where they are stressed out trying to cram in as much stuff to make up for this sorry amount. I could go on about this, but see either Gary Dee, Patrick Swayse’s rant in Point Blank, American Beauty, or Fight Club.
So that is why I am overseas. To get a little taste of adventure and save big bucks so I am not indebted to “THE MAN” and do whatever it is I want to do.
I feel like I have been given a Golden Opportunity to do something with this money so I can set myself up long-term and let my money work for me while I continue my Peter Pan-like existence - To avoid being another working schmuck.
I don’t want to open my own business because of the commitment involved and the fact that I have seen so many businesses go bankrupt.
The only investment vehicle [besides stocks, etc.] I see worthwhile is rental property because of its tremendous leverage. Dallas isn’t a sellers market – the demand isn’t that great, houses are cheap, and there is plenty of land to build on. I would have to look for “tight” rental markets like NYC/Boston, DC/Northern Virginia, West Coast, etc. There are certain areas where you could rent out a doghouse and people will rent it because they have no choice. I would need to hire a property manager because I don’t plan on doing any work myself. There are some inherent risks to rental property, however:
a)It is not a liquid investment.
b)The housing bubble could collapse – although I wouldn’t be doing this for several years from now.
c)House ownership is at an all time high.
d)Trouble renting the place outbad tenants