Comments on: Your Net Worth Is An Illusion, Sorry To Spoil Your Delusion!

By: View Your 401K Like Social Security And Write It Off | Financial Samurai

View Your 401K Like Social Security And Write It Off | Financial Samurai — Thu, 12 Aug 2010 09:04:06 +0000

[...] With the stock market implosion of 2008, your 401K has proven itself to be totally unreliable. Like Social Security, contribute to it like any good citizen should, but in no way depend on Social Security or your 401K to retire a comfortable life. Write off the value to zero and don’t believe in the traditional way of calculation your net worth. Your net worth is an illusion. [...]

By: Weekly Wisdom: Happy Financial Independence Day » The Online Investing AI Blog

Sun, 04 Jul 2010 08:34:07 +0000

[...] net worth? It’s an illusion, according to Financial [...]

By: Roshawn @ Watson Inc

Roshawn @ Watson Inc — Fri, 02 Jul 2010 15:07:12 +0000

Don’t say cold hard cash; instead say warm, soft cash ;) I completely agree that you cannt count your retirement portfolio in your net worth calculation if it is in a 401K & IRA…, unless maybe you multiply it times your tax rate plus a 10% penalty.
Roshawn @ Watson Inc´s last blog ..Why Is Debt Really Decreasing

By: admin

admin — Fri, 02 Jul 2010 00:55:27 +0000

I wouldn’t. No equity or perceived equity allowed in your net worth calculation! The idea is to not rely on anything! That way, you will have upside, and live your life with measured prudence.

By: Len Penzo

Len Penzo — Fri, 02 Jul 2010 00:48:02 +0000

I agree that it is folly to include your primary residence in your net worth calculations, Sam. I never did understand that line of thinking. I would include equity in second homes in my net worth calculations though.

Best,

Len
Len Penzo dot Com
Len Penzo´s last blog ..Dear Diary- What I Did On My Summer Vacation

By: admin

admin — Thu, 01 Jul 2010 23:45:47 +0000

Don’t think it’s quite too blood yet. In fact, I think things feel down right chipper in the real world! Gonna put up a post sometime soon to share.
admin´s last blog ..Overcoming The Wall

By: admin

admin — Thu, 01 Jul 2010 23:44:40 +0000

Hi Jon, thanks for sharing your thoughts, and good to see you see the light as well!

I like the idea of a permanent life insurance vehicle from a good, little chance of going bankrupt company. USAA is one of those.

Liquidity, and a REAL guaranteed return is key. Furthermore, in an environment where there is no inflation, or frankly, deflation, 2-4% returns or just fine thank you very much!
admin´s last blog ..Overcoming The Wall

By: DIY Investor

DIY Investor — Thu, 01 Jul 2010 14:59:20 +0000

I agree that asset allocation is the most important thing. It is also important
to have a plan which you obviously have. The thing to avoid, as Dalbar
points out every year, is for investors to get caught up in emotions. They
tend to sell at the bottom and buy at the top.
As this market moves lower keep in mind Rothschild’s maxim to buy when
there’s blood in the streets.
DIY Investor´s last blog ..Are You an Accumulator or a Decumulator

By: DIY Investor

DIY Investor — Thu, 01 Jul 2010 14:50:11 +0000

If you can retire at 42-45 go for it. I’m not sure 65 is a fallacy though for
most people. I would think 55 is doable.
If you have kids, want to live in a school district with good schools, take nice
family vacations etc. it costs a lot.
The .03 is the 3% safe withdrawal rate. I’m not sure if that’s what you were
referring to in terms of interest rates being low.
DIY Investor´s last blog ..Are You an Accumulator or a Decumulator

By: Jon DeGroff

Jon DeGroff — Thu, 01 Jul 2010 14:45:09 +0000

I agree. I don’t understand why people will put every dime they have into the market, and just “hope” for the best, and rely on these numbers to calculate their net worth. Myself, I have a lot of money in a permanent life insurance vehicle from an extremely strong mutual company, and my cash reserves grow every year. Of course, that will bring out the “you don’t get the cash when you die! and the “you only gain 2%” and the “your rep was just trying to make money!” comments, which I will gladly debate each and every argument. However, I put as much money as I can into my IRA every year, and I also have a pension. But what I’m looking for is access to cash, which is what my permanent life insurance provides to me. I don’t want to have to miss opportunities because I’ve locked up my all my cash in a vehicle that has no access or guarantees. Every year, my net worth actually increases with my cash values, and that is a number I can count on.

Great post.

By: admin

admin — Thu, 01 Jul 2010 14:09:11 +0000

Gotcha. I admire your guts. Hopefully you were able to stay the course last year and ride up the recovery!

By: everyday tips

everyday tips — Thu, 01 Jul 2010 13:21:54 +0000

I am probably 65-70 percent in stock right now. Too much I am sure, but I am not ready to make adjustments at these prices. I am in no hurry, but I do plan on switching out of some of my stock funds once prices recover some.
everyday tips´s last blog ..Thoughts For Thursday- Fun Can Be Had At Any Age

By: admin

admin — Thu, 01 Jul 2010 05:16:31 +0000

There’s no inflation that’s why rates are so low. Everything is rational.

Also, why do you assume people retire at 65? That’s a fallacy.

I really think most people, with their head on straight can retire after 20 years of work i.e. 42-45 years old.
admin´s last blog ..Overcoming The Wall

By: admin

admin — Thu, 01 Jul 2010 05:05:24 +0000

I hope you’re right that this post is a sign we’re near the bottom! I’m all about asset allocation frankly, and not so much stock picking.

I’ve believed in a heavy cash earning 4-5% return allocation for about 7 years now. I continue to believe in cash and stable investments.
admin´s last blog ..The NBA Finals Proves Location Matters For Success

By: admin

admin — Thu, 01 Jul 2010 05:04:09 +0000

Once you get to a certain level of cash accumulation, I start NOT wanting to take too much risk anymore. If you have $1mil cash earning $40,000 a year in interest, that’s good enough. It’s not worth it to me to potentially win or lose 20% or $100,000 in the markets.

I see what you’re saying, but I’m happy to have a minority of my net worth in the markets.
admin´s last blog ..Overcoming The Wall