This 4×6 index card has all the financial advice you’ll ever need • Hacker News Board

Re: This 4×6 index card has all the financial advice you’ll ever need

#221

Post by mdpopescu » Tue, Sep 17, 2013, 8:11 AM UTC

staccatomeasure wrote: post #156

dragonwriter wrote: post #155

Earlier quoted context omitted.

> Poor people: save money and pay off credit card debts. So, "poor people, get surplus income". Or, equivalently, "poor people, stop being poor". > And saying poor people couldn't save even a dollar is nonsense. If you can reliably meet the requirements of life without charity or depletion of reserves, you arguably aren't meaningfully poor. Poor people can save sometimes , but that's mostly saving a reserve for the b…

No. Poor people cut out non-essentials, be more efficient, and save money. A lack of nice things now will help later. Buy cheaper clothes, stop smoking, stop drinking, eat out less, don't have a fancy car...etc. Don't live beyond your means and consider your means what allows you to save 20%. Exactly what I'd have to do if I wanted to save more money. Stop pretending like poor people are all dizzy starving idiots tha…

As a direct example, my parents are both poor. They are retired and their total pension is about $400 a month... which they mostly spend on smoking and coffee. Oh, and they also have four TV sets (my father has an obsession).

Ok, so I can afford to supplement that income somewhat; but saying that they couldn't save is absurd.

Re: This 4×6 index card has all the financial advice you’ll ever need

#222

Post by eatmyshorts » Tue, Sep 17, 2013, 8:15 AM UTC

peterjancelis wrote: post #120

Doing a startup is inconsistent with the advice give here.

Replace 401K with SEP or Simple 401K, and I think the rest of the advice is valid. Also, consider the true cost of working for that startup. Stock with a startup effectively is valueless, and should be considered as such. If you can't save while working with a startup, or you have no savings as a backup if (and usually when) the startup fails, then you should consider a more traditional, established company instead.

Re: This 4×6 index card has all the financial advice you’ll ever need

#223

Post by eatmyshorts » Tue, Sep 17, 2013, 8:20 AM UTC

cperciva wrote: post #52

notdrunkatall wrote: post #34

Except for the 'never buy a security' bit, I fully agree.

Do you think you can beat the market? Are you a professional stock market trader? If you answered yes to the first question but no to the second, why?

Buy and hold, not day trade, and I think you can beat the market. You don't have management costs. And buy and hold avoids capital gains that professional stock market traders will incur. You also have to do your homework--don't buy the latest fad, and don't chase performance (that's a guaranteed train wreck waiting to happen).

And, yes, I can beat the market. My 20-year investment history shows that I consistently beat the market. And, no, I'm not a professional stock market trader. I've worked as support staff at investment banks, and I can tell you first-hand that there are many reasons not to be a "professional stock market trader". The industry is a horrible place to work, and I'm glad to be out of it.

Re: This 4×6 index card has all the financial advice you’ll ever need

#224

Post by eatmyshorts » Tue, Sep 17, 2013, 8:24 AM UTC

dnautics wrote: post #68

self-contradictory: "Make financial advisor commit to a fiduciary standard"

A Registered Investment Advisor (RIA) is required by FINRA to commit to a higher fiduciary standard than a broker (the more commonly used investment advisor). I think that's what he's referring to. Of course, most RIAs don't cater to anything but high-wealth individuals. Things are changing, though, as the Internet is enabling a number of RIAs to cater to those with lower levels of investment funds.

Re: This 4×6 index card has all the financial advice you’ll ever need

#225

Post by kilburn » Tue, Sep 17, 2013, 9:00 AM UTC

staccatomeasure wrote: post #207

Jormundir wrote: post #203

Earlier quoted context omitted.

Don't forget to tell them to let their babies die, those things are expensive. Parents too. Taking care of your aging folks can be expensive. Stop taking care of your parents. Any happiness you have now is because you're in the thick of a poor decision that is making you stay poor. Stop smiling, dumb shit makes you smile. Stop going to the doctor. Stop paying for vegetables, can food is cheaper. Stop the tendencies y…

Don't let your babies die, but really try not to have them if you can't afford them. I never said people's poor decisions made them poor, I'm saying they can help get out of poverty by making good ones. And if you have kids, yes, make a dollar. You brought life into this world and you have a responsibility. You can let your kids get stuck in a cycle of poverty by feeling like a victim or you can bust your ass to try…

> Don't let your babies die, but really try not to have them if you can't afford them.

This is outrageous. Parenthood is one of the most (if not THE most) meaningful parts of being human. Financial issues should NOT take this away from anyone.

Re: This 4×6 index card has all the financial advice you’ll ever need

#226

Post by Jugurtha » Tue, Sep 17, 2013, 9:01 AM UTC

Seeing the comments here about people is interesting. Whether it's in the comments or in reality, most people aren't conscious they are poor.

Poverty isn't a privilege reserved to those who live under bridges, or take showers once in a while.

Driving to work and back every day, stuck in traffic, getting home exhausted and not wanting to do anything is poverty.

It's amazing how many guys I know who start working and consider it a success and start spending cash, get a car on credit, get a mortgage and what not. They actually think that having an expensive car makes them rich, yet can't even afford a part of that car breaking. It's a disaster for them.

So, if you have to slave for a pittance (or not, you're slaving anyway). If you can't afford to be ill with some weird disease and getting properly treated for it without waiting social security. If you can't afford a good life for your children. If you can't buy something (a car, a house) without a loan and it still doesn't represent a good portion of your assets..

If you can't do that, you're poor. Poor in money, and most probably poor in time, too.

Re: This 4×6 index card has all the financial advice you’ll ever need

#227

Post by pathy » Tue, Sep 17, 2013, 9:45 AM UTC

lutusp wrote: post #204

mechanical_fish wrote: post #149

Earlier quoted context omitted.

The percentage of US workers with access to a retirement-benefits plan is 71%. 57% of all US workers participate in such a plan. (Source: U.S. Bureau of Labor Statistics, 2009 National Compensation Survey, http://www.bls.gov/ncs/ebs/benefits/2009/ebbl0044.pdf ) In Table 2, it says that even 15% of the lowest income decile - people making less than 90% of workers - find a way to participate in a retirement plan. Here'…

> Anyone making over $60k per year could [...] save 20% of their income without dropping below the median household income of $50k. 20% of 60k is 12k, 60k - 12k = 48k. So no, the claim isn't true for the most trivial of reasons.

Nitpicking, 48k is close enough for the point to still be valid.

You are technically correct though.

Re: This 4×6 index card has all the financial advice you’ll ever need

#228

Post by sopooneo » Tue, Sep 17, 2013, 10:38 AM UTC

twelve40 wrote: post #215

sopooneo wrote: post #179

Earlier quoted context omitted.

I never understood why real estate would be such a good investment. If one house is good, why not 100 as part of an REIT?

It's different than REIT, not necessarily universally "good". One obvious difference is with a house you get a collateral for a huge low-cost leverage, that in some cases might be easier to settle if things go South (e.g. shortsale). Another one is rent you save/collect from someone else.

To me, rent just seems like a form of dividend payment, which is of course not unique to property ownership.

Re: This 4×6 index card has all the financial advice you’ll ever need

#229

Post by chris_mahan » Tue, Sep 17, 2013, 11:59 AM UTC

bunkat wrote: post #114

chris_mahan wrote: post #108

Earlier quoted context omitted.

I should add that these college courses weren't just some courses I took, but were part of a BA.

It literally doesn't matter. I know you've convinced yourself that you are in some way better or smarter than everyone else, but you will not beat the averages unless you happen to get lucky. Your biggest mistake is assuming the market is a numbers game that you can win if you calculate things carefully enough. If that were true, all of the quants and hedge fund managers would be making there fortunes off of stocks i…

They are making their fortunes off stocks: other people's stocks. Or maybe they don't have enough capital on their own. Also, they are probably not as careful with other people's investments as with their own.

Re: This 4×6 index card has all the financial advice you’ll ever need

#230

Post by anovikov » Tue, Sep 17, 2013, 1:48 PM UTC

What about non-US people? U.S. index funds are off limits to us, and European ones are hard to trust, and normally require a lot of difficult paperwork to get in unless you are a citizen of a particular country, and operate off a very localized, and very small equities market (say Austrian, however healthy Austrian economy is i find it hard to bet my retirement savings on it, especially given neither my income nor my expenses have anything to do with it). And yes, fees of those funds are way higher than Vanguard's, due to their small size.

With income in 7-figure range, one can buy commercial real estate, which gives decent returns and is a good replacement for exchange-traded equities. But what about others?