In response to a money question
I’m only 1/2 kidding here, but…
Fuck tax defered retirement plans. 401k and IRA are better than nothing, true. BUT… You get anally raped if you need to withdrawl that money before the age of retirement. Where do you think the age of retirement will be when you decided to retire? Right now it is 59 1/2. That can easily be changed by future legislation. I won’t be 60 for over 30 years still. I expect that 59.5 age will raise to closer to 70.
Fuck that. I want to retire when I’m 40. I don’t want to pay taxes and a 10% penalty for early withdrawl. (yes, on Roth, you DO pay taxes on interest earnings if you withdrawl early)
What is even worse, lets say the retirement age stays the same. After a certain age you are FORCED to withdrawl. That means you could still be working a full time job, probably making the best money of your life (older people tend to make high salary due to their experience and/or many years with a company). And you would be FORCED to withdrawl from your retirement account and pay taxes on those withdrawls.(cept for maybe Roth IRA – although the fine print may say something about maximum earnings for an individual, and roth withdrawls may effect your income level, so even though the Roth income isn’t taxed, it puts all your other income in a higher tax braket)
The point is, forced withdrawl means you loose the power of compound interest. Your money can’t grow like it was, because you are forced to shrink that pool of funds.
So if you REALLY want your money to work for you, just keep it to yourself.
12% is cute and all, but I can get 10% just via Dividends by owning a premier UK power company, United Utilities (UU). Those dividends are paid anually (not quarterly like US stocks), but if DRIPed, then they can easily average over a 12% anual return over a period of 7+ years. Suddenly 12% doesn’t seem so high.
Finally, the other advantage to keeping all your money to yourself and out of IRA/ERISA programs is that you will have lots of cash on hand to buy houses. Slumlords do get rich. Trade in 4 houses and buy a hotel, just like monopoly. Hell, you could buy the Ramanda. I hear Mike Higgins’s health is not good.
Yes, I’ve read too much Robert Kiyosaki.