Budget Be Damned

[sailorboy1]

said my eyes are wide open

doesn't mean I need to go through life letting the worry of the future sour my present

[Dockhead]

Originally Posted by valhalla360

Gambling typically assumes the odds favor the house...I'll gamble every day when the odds heavily favor the player.

The only game like that is the one where you possess INFORMATION which the house does not. Which is why insider trader is the only sure fire way to make money in the stock market. Unfortunately it's illegal

[jmh2002]

Originally Posted by thomm225

Slowly at 51?

That's a really young age to be easing into your day

Originally Posted by daletournier

Sucking in time and enjoying it for what it is...

Sounds like the Mediterranean lifestyle, where YES work still needs to be done, but NO we sure won't let it get in the way of living life.

[Dockhead]

Originally Posted by sailorboy1

said my eyes are wide open

doesn't mean I need to go through life letting the worry of the future sour my present

I think everyone would agree with that.


Enjoy today; prepare for tomorrow.


It's not even mutually exclusive -- investing, and the work (including even thinking about coming bad times) which goes into making wise investment decisions, can be fun. It certainly does not require "souring the present".

[jmh2002]

Originally Posted by daletournier

In the meantime those that own some assets (like me) keep getting wealthier and the ones that dont get poorer.

Originally Posted by Trimaran Ken

A common myth.

Wages are up for everyone, but more for the lower paid employees. Unemployment is at record lows, overall, and in all minority categories.

Ken
===

A common myth? Really?

What does 'wages are up' actually mean for the lower paid employees? $100 per month more? Maybe $300 per month more at the top end?

So maybe a whole extra month salary, averaged across the year?
A total of an extra $1000, or $3000, or maybe $5000?

Meanwhile those with assets have added to their wealth by many multiples of these types of amounts.

So a lower paid employee has increased their wealth by say, $3000 over the year.

Meanwhile a wealthier person with assets has increased their wealth by $30,000, or $50,000, or $100,000 or maybe even more.

I'm sorry but I don't think your myth busting 'wages are up' theory makes sense in relation to this.

The Rich(er/ist) keep getting Richer.

Salaries for lower paid employees would need to increase by 50%, or 100%, or even more, to start changing this situation.

[jmh2002]

Originally Posted by sailorboy1

Some of you are so depressing it must be a sad life. Sorry if good times just make you focus on potential bad times.

This is a common (generally Western, English speaking) view here unfortunately.

Traditionally Eastern Europeans have had quite a different outlook on this subject, and on how to both save and spend money.

Historically life was always difficult, there was never enough money, and death await everyone, often sooner than planned, expected, or wished.

So in the mean time, try to live - do something, and enjoy something today instead of putting it off to tomorrow. Because tomorrow may be (and often was) worse

[Dockhead]

Originally Posted by jmh2002

A common myth? Really?

What does 'wages are up' actually mean for the lower paid employees? $100 per month more? Maybe $300 per month more at the top end?

So maybe a whole extra month salary, averaged across the year?
A total of an extra $1000, or $3000, or maybe $5000?

Meanwhile those with assets have added to their wealth by many multiples of these types of amounts.

So a lower paid employee has increased their wealth by say, $3000 over the year.

Meanwhile a wealthier person with assets has increased their wealth by $30,000, or $50,000, or $100,000 or maybe even more.

I'm sorry but I don't think your myth busting 'wages are up' theory makes sense in relation to this.

The Rich(er/ist) keep getting Richer.

Salaries for lower paid employees would need to increase by 50%, or 100%, or even more, to start changing this situation.

Saving and acquiring asset is the only way to be wealthy. By "wealthy" I mean that your family's needs are provided for a period of years or decades so that you are not living from paycheck to paycheck. This does not presume any particular standard of living, and a disciplined, modest lifestyle can do much to create "wealth" in this sense.

It's good that wages are up, but poor people will be poor as long as they are not able or not willing to save and invest. And people who do save and invest will naturally get richer and richer in comparison. This is not some kind of injustice; this is completely natural.

[jmh2002]

Originally Posted by Dockhead

Saving and acquiring asset is the only way to be wealthy. By "wealthy" I mean that your family's needs are provided for a period of years or decades so that you are not living from paycheck to paycheck. This does not presume any particular standard of living, and a disciplined, modest lifestyle can do much to create "wealth" in this sense.

It's good that wages are up, but poor people will be poor as long as they are not able or not willing to save and invest. And people who do save and invest will naturally get richer and richer in comparison. This is not some kind of injustice; this is completely natural.

I totally agree. And I'm certainly not suggesting that wages being up is a bad thing. Nor am I commenting on any injustice, perceived or otherwise.

My point was that wages for 'lower paid people' are not up to any point whereby they may equalise their wealth compared to people with existing assets.

So I believe that Dale's statement is totally correct, and not "a common myth" in any way.

The overall wealth of those who own assets continues to grow at a faster rate than those who don't.

The Rich(er) get richer and the Poor(er) get poorer, both faster as well as relatively, by comparison.

[sailorboy1]

I've been "poor" and I've been "rich" (never really been either except in comparison). It is better to be "rich"!!! Part of how I got "rich" was by being "poor" way back and instead of spending all my income, I saved and invested some. It was tough and there were lots of times that extra money could really have been helpful to live on that month.

Now that I'm rich I retired at 56 and now live in a 400 square foot floating trailer instead of a multistory house. But my assets grew enough this week to pay for next months living expenses plus some. I sometimes get over optimistic and play with my cruising kitty spreadsheet and adjust my estimate of ROI. Just this morning I changed ROI to 2.5% and find at age 90 I will have doubled my assets. I think I'm going to try to start living a little nicer on the floating trailer.

So there :

[jmh2002]

Go ahead, you are living proof of exactly what Dale stated, no "common myth" involved

And yes I understand exactly (from personal experience) what you said about being poor was part of how you got rich. I think that was @Dockhead's point too.

[a64pilot]

Originally Posted by Dockhead

Saving and acquiring asset is the only way to be wealthy.

It’s really not, or at least not anymore, the US and I’d suppose the world has very many second and maybe even third generation very wealthy people, who actually do nothing at all, but apparently make fools of themselves seeking social acceptance and worship. The wealth is passed on from one generation to another with systems and people who manage it to ensure its continued existence. I believe this is a time honored tradition of the “Old” World.
Reminds me of a Story. For Some reason or another the Officers in my unit were required to attend some social function Downtown Savannah, I overheard our Chaplin talking to a nice looking lady, he asked her what she did. She looked at him horrified and informed him that she was a Habershim, the Habershims have others that “Do” for them.
The Paris Hilton’s of the World, not all are so rich, but many are. You run into quite a few of them in their Yachts when out cruising. It’s tough to explain a Millennial in a expensive Yacht with paid crew and out in the night life enjoying life any other way.

However for many reasons wealth accumulation is more difficult now in the US than in times past, but most anyone can accumulate wealth, they just have to have the desire to is all.

There is a point in accumulating wealth that it achieves its own inertia and once your there, it accumulates on its own so to speak.
Most never get there, most as they make more money very quickly absorb it into their lifestyle with ever larger and larger loans to pay for second homes, McMansions and new vehicles every other year.

We are supposedly entering a time period when the “Boomers” will begin to sell their houses due to age, it’s supposed to last for 20 years . It’s going to be interesting to see how that goes, many owe huge sums,and it may be that not many want to buy those McMansions. That may even be one force that adds to a recession, look at the last one for the precedence.

[jmh2002]

Originally Posted by Dockhead

Saving and acquiring asset is the only way to be wealthy.

Originally Posted by a64pilot

It’s really not, or at least not anymore

@Dockhead's comment was in relation to the previous posts regarding "lower paid employees".

I think that your comments, whilst valid for some individuals who have or will inherit wealth, are somewhat out of context.

[a64pilot]

I see that now.

[Exile]

Originally Posted by Dockhead

Taking money off the table when the markets are way up is a really good idea.

* * *

I have a certain amount of money in the markets, but I would reduce exposure to equities at this point if I had a significant amount of my net worth tied up in them, which I don't.

Yet reallocating an equity portfolio during a sustained bull market is often one of the more difficult things for individual investors to do. And understandably so -- who wants to throw cold water on the party? On the other hand, history has shown that equity markets have always recovered from downturns, and then some. Possibly better than any other asset category. I'm talking generally, of course, which is all we can really do given the many variables. Perhaps the most significant variable being how dependent one is on equity returns as opposed to outside sources of income to fund their lifestyles. The last thing you want to do is be in a position to have to liquidate equities during a downturn simply to fund expenses. Those who can "afford" to wait out market downturns in equities are the ones who come out ahead in the longer run.

Sorry if I'm merely restating the obvious above, but I think proper management of unrealized gains in equity markets can be tricky and not always intuitive. There were many years following the 2007-08 crash where the combo of losses in equities and anemic returns on fixed income had a corrosive impact on peoples' wealth. But as Dockhead points out, fixed income may be looking more attractive as inflationary factors kick in. This would suggest a reallocation out of equities to be prudent. But then hindsight's always genius.

[cyan]

Originally Posted by Dockhead

The only game like that is the one where you possess INFORMATION which the house does not. Which is why insider trader is the only sure fire way to make money in the stock market. Unfortunately it's illegal

I think there is a middle ground between "sure fire" insider trading and a roulette even-bet. Information (non insider) can change your odds and its all out there- none of it rocket science. The catch is it takes a looong time to properly examine a single equity, and personally I'd rather spend time on brightwork.

Such information is not always possessed by just institutions. 'Couple years back in the course of my technology job, I stumbled across a new product from an old company called AMD that was much cheaper and better than that of the long time king of the industry, Intel. With intimate understanding of the technology implications, (but thin financial understanding) I scooped up shares. That play has tripled, and I would say that it was a better play than a few chips on black.