How are your investments doing?

[Snobdds]

401k offers multiple levels of benefit.

Almost every company I worked for offer a 50% match on the 1st 6%. You'd be awfully silly not to contribute at least 6%.

Next, you get to defer the taxes. For us, that meant avoiding high tax rates during our prime earning years and paying taxes on it now when we have very low income. Currently, that means paying 12% or less versus over 30%. (Different rules for Roth)

In a pinch, you can borrow against your 401k and pay yourself back the 'interest'. (And it is still not income, because it's a loan).

Those 1st two guarantee I would not stop contributing. At most, I would consider reducing contributions to the max match rate (personally, I would invest as much as allowed, as long as I could still pay my living expenses).

There may be a few unique situations for high earners or those with a generous pension where the tax benefit is lessened. Even then, the matching is hard to throw away.

Most wealthy people never have real income. They take loans against an equity position and live off loans to themselves. Most time the dividends replace the money taken out and the principle continues to grow.

We all do it and so do politicians. They won't fix it because it would hurt them and their donors.

It avoids a lot of tax burden.

 

[Fuddyduddy1952]

I beg to differ...

 

[MossRoad]

I did that back in 91 and was all in but best laid plans don’t always work.

Same job but change of ownership left 80% of the match on the table… had the date of ownership change happened 10 days later I would have only left 60% on the table due to vesting rules at the time.

Congressman Pete Stark got involved and one result is vesting timeframes we’re later shortened.

My early experiences of stock to zero value and losing 80% of the match shaped my thinking.

That stinks!

As I recall, our vesting was 5 years. If anything happened before that, I'd only get back what I put in and the gains on that percentage. They could take back the match and any gains on that part of it.

My current employer is 100% vested immediately. That's not required, just a perk. And now, upon new hires, they automatically take 5% of your pay and put it in the 403B with a 5% match. You have to sign papers if you don't want to participate or lower the contribution.

As for individual stocks, I've never owned any. Just invested in the 401K/403B mutual funds and IRAs the same. I'm pretty sure I could switch to an IRA that allows us to purchase individual stocks and such, but I do not want to do that.

 

[MossRoad]

I beg to differ...

He said 'most'

you're an enigma

 

[ultrarunner]

I like residential income property but not so much anymore… and it’s not the work that troubles.

The pandemic really showed how things can change almost overnight…

Owners required to maintain all services, property taxes, etc… but tenants could not be evicted for non payment…

It was particularly onerous here and I still have a tenant on deferred payment from pandemic.

 

[MossRoad]

I like income property but not so much anymore…

The pandemic really showed how things can change almost overnight…

Owners required to maintain all services, property taxes, etc… but tenants could not be evicted for non payment…

It was particularly onerous here and I still have a tenant on deferred payment from pandemic.

Yes, I recall that. I could not imaging my grandparents with their 6 rental units not being able to collect rent for years. Just seeing the problems they had with renters that WERE paying rent (sometimes) was enough to keep me out of owning rental units.

 

[Torvy]

When I first worked FT, the rule was 10 year vesting, but that was for the pension. 401K was as soon as 90 day probation was over. The pension was later reduced to 5 years before it was phased out. I was there 8 and change. I'll see maybe $300 a month from that. I just wish I was wiser when I was younger. I stayed at 6% to 'maximize' my ROI. I hadn't fully grasped compound interest or I would have tightened my belt and cranked it to 15% sooner.

I made it a point to explain it to my employees, and later, my students. Many (not all) of our poor families are poor because they don't understand a few economic facts. If they actually itemize their true spending in a budget, many 'discover' that their daily latte and/or 6-pack (or whatever habit) is costing them considerably more than they realize. Putting that money into a 401K can be life-changing.

Generational wisdom is much more valuable than generational wealth. Lots of idiot rich kids squander their inheritance (seems I remember a very old story along those lines...). Lots of wise poor kids pull themselves up out of poverty.

 

[MossRoad]

When I first worked FT, the rule was 10 year vesting, but that was for the pension. 401K was as soon as 90 day probation was over. The pension was later reduced to 5 years before it was phased out. I was there 8 and change. I'll see maybe $300 a month from that. I just wish I was wiser when I was younger. I stayed at 6% to 'maximize' my ROI. I hadn't fully grasped compound interest or I would have tightened my belt and cranked it to 15% sooner.

I made it a point to explain it to my employees, and later, my students. Many (not all) of our poor families are poor because they don't understand a few economic facts. If they actually itemize their true spending in a budget, many 'discover' that their daily latte and/or 6-pack (or whatever habit) is costing them considerably more than they realize. Putting that money into a 401K can be life-changing.

Generational wisdom is much more valuable than generational wealth. Lots of idiot rich kids squander their inheritance (seems I remember a very old story along those lines...). Lots of wise poor kids pull themselves up out of poverty.

I recall a kid laughing at me because I'd bring pop from home and keep it in a fridge under my desk. Then I added up his two $1.35 pop a day from the machine cost for 5 days a week for 50 weeks a year and my two $.33 cent a can pop from home. He spent $1.70 a day and I spent $.66. Then we put the savings into an investment that returned 7% over 40 years and it was well over $75k.... in soda pop from home!

He never laughed at me again, but he didn't stop buying pop out of the machine, either. I outlasted him at that company as well.

 

[CloverKnollFarms]

My son and I proved mathematically that as a single guy, he could retire a multimillionaire working full time for $17/hr.

But, it requires what is lacking in most people’s financial plans… discipline

 

[Torvy]

I like income property but not so much anymore… and it’s not the work that troubles.

The pandemic really showed how things can change almost overnight…

Owners required to maintain all services, property taxes, etc… but tenants could not be evicted for non payment…

It was particularly onerous here and I still have a tenant on deferred payment from pandemic.

Amazing when a pol can come in and require that you provide particular appliances, too. When I was young and poor, I would have been better off with a dorm fridge, a hot plate and a microwave. A full-sized fridge for a couple of condiments and a 6-pack is not worth the increase in electric bill. It's one thing as a market differentiator, quite another to be forced on a landlord with a different model.

I don't know how you do it. Being a landlord in a reasonable jurisdiction is tough.

If I were you, I'd cash it all in, even at a loss, and move to Idaho or Nevada. Still close enough to see family, but less crazy. (Though Nevada has been slipping due to an influx of escapees who don't understand why things got worse in CA).

Dad's older brother escaped WA in the mid 90s to just outside Boise. He and his family are all still there. He's probably 97 now. The oldest, but the last of his sibs.

 

[Torvy]

My son and I proved mathematically that as a single guy, he could retire a multimillionaire working full time for $17/hr.

But, it requires what is lacking in most people’s financial plans… discipline

If you're bored, do the math on minimum wage for your whole life, but investing the 12.4% they take for SocSec and put it in the S&P. It's nearly a million in real dollars, iirc.

Of all the silly things taught in school, most places don't even require financial literacy and many that do have financially illiterate people 'teaching' it.

Good on you for showing your kids the way.

 

[MossRoad]

My son and I proved mathematically that as a single guy, he could retire a multimillionaire working full time for $17/hr.

But, it requires what is lacking in most people’s financial plans… discipline

Yep! Now partner up with someone and make double that but living on one income and invest the rest (helps if they're attractive)

 

[Fuddyduddy1952]

He said 'most'

you're an enigma

When I first read I thought you said "enema".

 

[Torvy]

Yep! Now partner up with someone and make double that but living on one income and invest the rest (helps if they're attractive)

My oldest sister and her husband did that. He was an actual economist. She was a professional librarian. They lived on one salary for their 1st 10 years (at least), despite both being employed FT in their fields.

They're pretty frugal, I'm sure they have 2-3X what we have in retirement. God did laugh a bit and blessed them with 3 daughters and some medical bills. They are financially fine, despite that. He's sick with some lung-related auto-immune. He limits his travel and exposure. They stayed in OR because their girls all stayed in the region.

 

[ultrarunner]

Amazing when a pol can come in and require that you provide particular appliances, too. When I was young and poor, I would have been better off with a dorm fridge, a hot plate and a microwave. A full-sized fridge for a couple of condiments and a 6-pack is not worth the increase in electric bill. It's one thing as a market differentiator, quite another to be forced on a landlord with a different model.

I don't know how you do it. Being a landlord in a reasonable jurisdiction is tough.

If I were you, I'd cash it all in, even at a loss, and move to Idaho or Nevada. Still close enough to see family, but less crazy. (Though Nevada has been slipping due to an influx of escapees who don't understand why things got worse in CA).

Dad's older brother escaped WA in the mid 90s to just outside Boise. He and his family are all still there. He's probably 97 now. The oldest, but the last of his sibs.

Appliance requirement is just one of the 2026 laws.

I had been managing several years when I sat down and analyzed 3 years worth of service calls…

About 50% were appliance related and many were emergency calls… my freezer quit and it’s full of steaks for the 4th of July BBQ or it’s Thanksgiving and the oven quit.

Back then the Housing Authority allowed $1 a month for landlord provided stove and $2 for refrigerator…

Forego $36 annual income in exchange for no more stove and refrigerator service calls was a no brainer.

New refrigerators scare me… often, even under warranty repairs can take weeks… and that doesn’t work when the owner is responsible to provide.

I’ve given refrigerators to tenants just to not be responsible… besides many turn out to be science experiments…

Before Just Cause Eviction laws… it was simple to just wait out the lease for a bad tenant.

Now, a reason must be given and approved by the city to proceed… if I say drugs… I have to prove it… if a minor is involved the police reports are withheld or redacted…

Rent increase limited to a fraction of the published CPI just means going broke slowly…

The changes have reduced the number of mom and pop housing providers… too many minefields to navigate and renters have free lawyers…

Olympia WA is just as bad…

I’ve slowly been divesting of anything with a bed… transitioning to commercial and industrial…

These have their own problems… a friend can’t sell his property because it’s next to a defunct dry cleaners… decades of solvents have tainted the soil…

I have a city parking lot that I can’t park cars on… zoning aggressively pushing out anything auto related… they want me to build housing… I don’t think so.

 

[Highlandr]

Almost every company I worked for offer a 50% match on the 1st 6%. You'd be awfully silly not to contribute at least 6%.

My former employer was 100% on the first 4%. A LOT of people leave that money on the table. Most common reason is "can't afford to".

If they actually itemize their true spending in a budget, many 'discover' that their daily latte and/or 6-pack (or whatever habit) is costing them considerably more than they realize. Putting that money into a 401K can be life-changing.

Or a pack of cigarettes or two a day. "For just five dollars* a day you can change your life."

* I have no idea what a pack of cigs cost these days.

 

[Torvy]

Around 2000, we almost moved to Tumwater area. I'm glad God had other plans.

 

[ultrarunner]

Around 2000, we almost moved to Tumwater area. I'm glad God had other plans.

I’m truly surprised by the shift in Washington…

It’s scenic beauty remains and the climate agrees with me but I may be closing that chapter due to monumental changes affecting property owners, business, etc…

I like Nevada but the parts I like are already very expensive and things are changing there…

Some call it Califorcation…

 

[Highlandr]

I recall a kid laughing at me because I'd bring pop from home and keep it in a fridge under my desk. Then I added up his two $1.35 pop a day from the machine cost for 5 days a week for 50 weeks a year and my two $.33 cent a can pop from home. He spent $1.70 a day and I spent $.66. Then we put the savings into an investment that returned 7% over 40 years and it was well over $75k.... in soda pop from home!

One of the local lunch dives doesn't take cards or checks. Would often see a young guy from work there with his lunch group. Every... single... time he would have to get cash from the ATM there to pay for his lunch. I started watching him. He was getting a single $20 (probably the minimum). Of course those independent ATMs charge a two or three dollar fee. Pretty hefty "service charge" for lunch.

 

[ultrarunner]

One of the local lunch dives doesn't take cards or checks. Would often see a young guy from work there with his lunch group. Every... single... time he would have to get cash from the ATM there to pay for his lunch. I started watching him. He was getting a single $20 (probably the minimum). Of course those independent ATMs charge a two or three dollar fee. Pretty hefty "service charge" for lunch.

Here it’s the opposite… more going cashless everyday…

Cards only.