All Forum Posts by: Hugh Carnaha
Hugh Carnaha has started 42 posts and replied 84 times.
Post: $$ Podcast investments Fee Caclulator and personal weath track
- Rental Property Investor
- Springfield, MO
- Posts 86
- Votes 35
I hear many guests on the Money Podcasts talking about putting investments into a caclulator and finding fees, and unrelated i've heard them talk about a personal wealth tracker. Are those programs/apps they're using, or are they just doing that on spreadsheets themselves?
If they are apps, what are the names of them? If they are tracking them manually, does anyone have a good resource to go to learn how to do that?
Post: How does market dip effect the FI people living off investments?
- Rental Property Investor
- Springfield, MO
- Posts 86
- Votes 35
So in the FI space, when people are doing safe withdrawls, are those from brokrage accounts?
Originally posted by @Will Fraser:
Howdy @Hugh Carnaha! The answer to your question here is going to be based on what the 4% rule is more formally known as: "The Safe Withdrawal Rate" or other similar names including the word "safe." Within the FI and FIRE communities there is a lack of consensus around 4% specifically and you'll find the more conservative members favoring a lower rule, like 3.6% or 3.8%.
The reason this is considered a "safe" rate to draw down on your investments is that the overall market returns OVER TIME are well above 4%, so if you build your assumptions on numbers that have historically been achievable, then you'll have the highest likelihood of achieving similar results. During a recession, correction, or coronation (can we call it that?) the value of investments will shrink but the ideology is based on what happens over the grand scale. So, short term losses are washed out by years like 2018 and 2019, which "ran" for well above 16%.
There is an element of "luck" here, like any of the FI pandits will acknowledge. If you are 30 years old, hit your FI number, and handed in your 2-weeks notice to your employer to start out 2020 then your portfolio will have a more significant drawdown affect as a result of having a "down market' in the initial withdrawal period.
For a more robust discussion on this I would recommend digging into the Sequence of Returns Risk discussions with JL Collins (the FI guy, not the Built To Last guy) and Big ERN from Early Retirement Now
Post: How does market dip effect the FI people living off investments?
- Rental Property Investor
- Springfield, MO
- Posts 86
- Votes 35
That makes good sense. The Safe Withdrawl Rate is in the long term, so the overall many good years would offset the corrections.
It's really a numbers game, but in gerneral, younger investors like your "2-weeks notice" senario would much greater impacted than the folkd in their 50's who have invested longer.
Post: How does market dip effect the FI people living off investments?
- Rental Property Investor
- Springfield, MO
- Posts 86
- Votes 35
Howdy Guys!
I listen alot to BP's Money podcasts. I know that the Corona virus has spooked the market down by 12% in the last few days. And I know it is generally held that it won't matter what we do if you hold for the long run. I see it as a fantastic time to buy, yadda yadda.
But it lead me to wonder about the 4% rule, and everything else. How does a correction, bear market or recession effect those who actually LIVE off their funds or dividens? If your portfolio drops from 500,000 down to 440,000 in 1 week, does that actually do anthing significantly negitive for those who depend on their portfolios?
Cheers!
Post: Convert/rollover normal 401k and IRA into self directed?
- Rental Property Investor
- Springfield, MO
- Posts 86
- Votes 35
Originally posted by @Mike S.:
@Hugh Carnaha
You can withdraw your yearly contribution to a ROTH IRA without penalty and you have until tax filing date next year to still contribute for the current year.
If your ROTH IRA has been established long enough you can also withdraw all prior contributions also without penalty, however you won't be able to put them back in.
If you have a 401k your plan may allow to borrow up to $50k with a 5 years repayment schedule with interest (that you’ll pay to yourself in your 401k).
However borrowing from a retirement plan need to be thoroughly thought out as it will most of the time go against the goals that you have set for retirement.
So what is the process one would actually do to pull the money out for just this year? 1) Sell asset inside IRA = $6k, it's back into the money market account 2) transfer money back into bank? Do i need to report anything to anyone or fill out a form of some kind?
Post: Convert/rollover normal 401k and IRA into self directed?
- Rental Property Investor
- Springfield, MO
- Posts 86
- Votes 35
Originally posted by @Carl Fischer:
You can take out your 2020 Roth contribution without any penalties .
converting to a SDIRA does not allow you to borrow from it for several reasons.
This is excellent! I thought once it was in, it's in till you retire. Does this always apply for the same year? If I take money back out, can i put it back in up to the 6k this year?
Post: Convert/rollover normal 401k and IRA into self directed?
- Rental Property Investor
- Springfield, MO
- Posts 86
- Votes 35
Howdy Guys!
I did a bit of searching, but couldn't quite find what I needed. I did a dumb thing Jan 2 and Maxed my ROTH IRA for the year. Now i'm trying to find funding to keep a rehabing some of my distressed properties.
Would it be possible to rollover/convert an Roth IRA into an self directed IRA? Then take a loan against it for repairs, then return the loan with interest back into the ira?
Is something like this, or something similar possible?
Cheers!
Hugh
Post: I cashflowed $3.08! SUCCESSSSSSS!
- Rental Property Investor
- Springfield, MO
- Posts 86
- Votes 35
You guys freaking rock!!!!
Today was the very first time my PM wrote me a check, it hit my bank account, and after expenses for Jan 2020 I cashflowed $3.08! I've worked every day since I've graduated college, i've had income, i've had bonuses, one time I found $10 in the road.....But this $3.08 is more meaningful then all of it. It represents the first step towards financial freedom! I'm totally going to do the cliche thing and go to the bank, take out $3.08, and have it framed.
In 3 months I went from a cog in a machine for someone else, to stumbling upon BP, to owning realestate, to the smallest chance one day i'll be financially independent. All of this can be attributed to all of you guys who are here posting, helping, sharing, complaining, advising, suggesting, and asking.
There are very few communities that actively give/share as much as BP. I just wanted to thank all you internet strangers for helping me get to where I am today!
Cheers!
Hugh
Post: Pints and Properties! New Year, New You! Springfield, MO
- Rental Property Investor
- Springfield, MO
- Posts 86
- Votes 35
Howdy Guys!
I totally snagged the name from Shelby and David from Military to Millionaire! Thanks for that. I'm creating an event at Big Whiskeys in Nixa to discuss real estate with anyone in the area who is interested! Figured we could snag pints and talk properties. I've set the time at 1200-1300hrs to give everyone time for hangover recovery from the night before!
I look forward to seeing you there!
Cheers!
Post: BRRRR vs Traditional Buy and hold? How to scale?
- Rental Property Investor
- Springfield, MO
- Posts 86
- Votes 35
Howdy Guys!
There's that age old debate on here on if you had $100,000 would you buy a single home or would you put 20% down payment on 5 100,000 homes. Most of these are talking about raising capital to be able to get to $100,000.
How large does this idea scale? Is there a theoretical $$$ amount that says above or below X amount, it would be advantages to do one over the other?
If someone had a rich uncle who had 1,000,000 would there be a, "buy and apartment complex?"
Personally, my gut tells me that BRRRR is the way to go in all the stuff here in the midwest i've been running numbers on. It got me wondering about the big boys and if they played by different rules.
Cheers!