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78Southwind

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I'm not sure if Karma is the right word. I didn't fuck anybody on my way up, I worked hard and everyday that I did have money I asked myself "how did I get so lucky?" or "what did I do to deserve this?". The economy took a hit, I was young and naive and thought it would last forever.

Congratulations, I am glad you paid back that huge SBA loan. 🤬
 

lakemadness

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Here is the thing. I have managed to acquire a pretty fair amount of net worth but rarely have more then twenty bucks in my pocket. Now with retirement just a few months away I'm trying to figure out how to keep what I've built without getting raped by taxes. I own two houses in SoCal that I would like to sell but if I sell both in the same year I'm going to get taxed up the ying yang. I can't even sell off my primary residence this year because the gains on the property plus my salary from work will make it look like I'm making 400k and we are already paying estimated taxes because of the sell of a property in Az. that we didn't do a 1031 exchange on (we didn't know that all the paper work for that has to be done prior to sell). Then the following year when I sell the rental it's going to be another 400k income. The point is that even though I've built pretty substantial "net worth" with minimal debt it doesn't really feel like I'm wealthy by any stretch of the imagination.
I know it may sound like first world problems but honestly I feel like I'm working harder to keep what I've earned than I had to when I earned it in the first place.
I need a financial advisor!!!
I’m interested to know more, are the properties you own not income producing properties?
 

GRADS

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Congratulations, I am glad you paid back that huge SBA loan. 🤬
I did not and you know that. I had to file bankruptcy, which you also know. What's your point?
 

Rajobigguy

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I’m interested to know more, are the properties you own not income producing properties?
I have a Rental in South Gate, the mortgage is $425 a month and we rent it out for 2k so that is income producing. Our primary residence in Downey we own outright, then our retirement home in Havasu that we still owe upwards of 300k on.
 
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Jimmyv

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Because there are better investments for those who want to search.

There are definitely better investments available, but I don’t look at a 401k that way, I consider it a safety net. If nothing else works out, at least there’s money there.

Scrape money together and pursue those other investments outside of your retirement savings. Do what you want with those returns. Save it, spend it, reinvest it - doesn’t effect your retirement nest egg.
 
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Jimmyv

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Just an FYI from someone who has been through a bankruptcy...They will take all your investment property...they pretty much take everything, but 401K's are untouchable.

Great point.
 

bowtiejunkie

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Curious how many track their net worth and have a personal financial statement that is regularly updated.

For last 15 years I’ve maintained a simple financial statement in Excel. Along with a monthly budget of major categories (I don’t track expenses to the penny anymore as it was more work than benefit). I update this file twice a year (April after annual raise/bonus, and at year end). Also, in Excel I have a checkbook of sorts that I use to project checking balance.
 

Your ad here

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Because there are better investments for those who want to search.
There are definitely better investments available, but I don’t look at a 401k that way, I consider it a safety net. If nothing else works out, at least there’s money there.

Scrape money together and pursue those other investments outside of your retirement savings. Do what you want with those returns. Save it, spend it, reinvest it - doesn’t effect your retirement nest egg.
True there are other investments but I was talking about is people more my age, young blood, but still applies to old farts. If a company offers a 401K take advantage of it and take advantage of the employer match. Even if you put $100 in a month. Biggest hurdle is getting started. It's safe and as the market history shows the graph always goes up. There are some dips and that's when you buy and ride it out instead of getting emotional and selling.
 

GRADS

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I was just replying to your comment, "I didn't fuck anybody"... 💩
I said I didn't fuck anybody on the way up regarding Karma. Go back and read my posts.
 

78Southwind

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I said I didn't fuck anybody on the way up regarding Karma. Go back and read my posts.

Come on we have been through this before... You should have stayed a Gopher at that pool construction company (at least you could have been proud of the sweat of your labor). And it would have saved the $3 Million of taxpayers money that you defaulted on...

Grads idea of how to become a Millionaire...
Take every last cent of equity out of your home. Take that money and put it down as the 10% downpayment on a business. Then borrow $3 Million (that's backed by taxpayers) for the purchase of that business. Then back the personal guaranteed SBA loan with the home that has no equity in it. Next, live the life of a Playboy when your credentials are really that of a Gopher... What could possibly go wrong? Then when the scam fails never work again since you are personally liable for the loan.
 

Flatsix66

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Knowing your net worth is a good measure to know if trading your time/sweat/work is producing anything during the course of your life. It's not taught in our schools but it's a little known fact that saving enough money, and through the magic of compounded interest, will result in your accumulated wealth producing enough money that you can live off the earnings and out last you for the remainder of your life. It's fucking magic and really the only assured way for a guy starting with nothing to trade his time into money and let it work for him until he becomes no longer dependant on working...and this can happen earlier than the typical retirement age...if you don't fuck it up.

If you have been saving in a retirement account and working toward the goal of retiring one day it's time worth sitting down with a fiduciary (fee only) financial advisor. Many of them offer a free analysis and will map out how all your income sources will pay out and last over your lifetime in retirement. We did that first in our late forties and learned a lot about setting goals and how life could look if we made the right moves. Here is one we used and really liked: https://purefinancial.com/lp/free-assessment/ .

I would never trade the fun times, experiences and lessons learned we have enjoyed in our life even though they were not the best choices but you get lots of opportunities to pay yourself back and set things right, starting earlier would make it a lot easier:)
 

GRADS

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Come on we have been through this before... You should have stayed a Gopher at that pool construction company (at least you could have been proud of the sweat of your labor). And it would have saved the $3 Million of taxpayers money that you defaulted on...

Grads idea of how to become a Millionaire...
Take every last cent of equity out of your home. Take that money and put it down as the 10% downpayment on a business. Then borrow $3 Million (that's backed by taxpayers) for the purchase of that business. Then back the personal guaranteed SBA loan with the home that has no equity in it. Next, live the life of a Playboy when your credentials are really that of a Gopher... What could possibly go wrong? Then when the scam fails never work again since you are personally liable for the loan.
Don't waist time on jealousy. Sometimes you're ahead, sometimes you're behind.
 

GRADS

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Come on we have been through this before... You should have stayed a Gopher at that pool construction company (at least you could have been proud of the sweat of your labor). And it would have saved the $3 Million of taxpayers money that you defaulted on...

Grads idea of how to become a Millionaire...
Take every last cent of equity out of your home. Take that money and put it down as the 10% downpayment on a business. Then borrow $3 Million (that's backed by taxpayers) for the purchase of that business. Then back the personal guaranteed SBA loan with the home that has no equity in it. Next, live the life of a Playboy when your credentials are really that of a Gopher... What could possibly go wrong? Then when the scam fails never work again since you are personally liable for the loan.
And this is all true👆 So your point is?...
 

Dirty Daytona

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I don’t have a lot of accumulated wealth. But what I do have is a bitchin pension, thanks to all you guys in California. I had to dodge some bullets, but it was worth it. So, thanks fellas!!
3% at 50 is a beautiful thing!!!
 

78Southwind

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Trolled by a jet boater?🙄🤣

Grads Jet Bote3.jpg
 
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Paradox

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We are roughly 48 months from retirement and, although I look at it, net worth isn’t a primary factor. The idea for us is to be debt free and have a monthly income stream (that will make life comfortable) for life.
 
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78Southwind

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Since I am done trolling @GRADS

How about some strategies that would help with increasing your non-taxable net worth.

Here is a tax free strategy with CA Real Estate and a Roth IRA (it also could be used up through the 12% tax rate). Let's say you have your home that is paid off and a vacation home (you could even downsize and rent an apartment or travel in a RV if you want). You have had your home for 30 years and you are 55 but you want to retire at 60. However, you just haven't saved enough money in your 401(k) and you don't have one of the those things...what do you call it?...oh yeah a pension.

If you are 55 or over, sell your home sometime before you retire and buy a new home in a more rentable or desirable area like a beach community. Take a loan matching the amount of time you will live in the home before you retire including the 10 years you are going to rent the home out for (in this case we will use 15 years). Match that loan amount to create a payment that the home would rent for including other expenses like property taxes and maintenance expenses. Try to stay in the same purchase amount (maybe downsize) so that you can transfer your tax basis (keeping taxes low).

Live in your new home for a couple years or in this case five years before you retire and then at 60 rent the house and move into your vacation home. Purchasing the new home will step-up your cost basis to the new purchase amount. So when you rent the home the depreciation will be much higher than your previous home creating a paper loss allowing you to partially live off the rental income, the cash you borrowed while using minimal amounts from your 401(k). Utilize your paper loss from the depreciation to lower your AGI while utilizing your standard deduction on up through the 12% tax bracket to chunk money yearly from your 401(k) into a Roth IRA.

A medium priced home in Los Angeles is $826,566 where the depreciation on the replacement home for the first year would be ($826,566 / 27.5 = 30,056.95) if the replacement home didn't have any land value like a beach city condo or something like that (otherwise the depreciation value would be less the land value). That same depreciation for 10 years would be ($826,566 / 27.5 = 30,056.95 * 10 = 300,569.46).

Zillow says a house like that would rent for $3,600 and property taxes would be somewhere between $3,000 to $4,000 a year.

A $400,000 loan @ 2% for 15 years is $2,574 per month ($667 Interest + Principal $1,907), on the high side $333 a month for taxes, insurance $166 a month, $527 a month maintenance and reserve. So you make a small profit on the rental but create a paper loss with the monthly depreciation of $2,504.

I would have to run a mock tax return for the 10 years and an amortization schedule for each year to see how profitable it would be but it looks like a great way to use the tax system if it fits your needs. There would be some downsides as well. You wouldn't be able to sell the home without the recapture of depreciation or until one of the spouses passes away when at that time the home would step-up in cost basis to current value. I am sure there are other positives and negatives that others will find. So what other strategies will you be using before or during retirement?
 
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CarolynandBob

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Yes I know our net worth. Got it by saving 30% of our income. We both were saving 20% before we got married. We each had a condo. We sold those and bought a house. We took the difference in our 2 condo payments vs our new house payment and started saving that as well, which was about 10%. Didn't change our life, so kept saving it.

As far as debt. You can use it. We had a mortgage, but never ever touched the equity. We had car loans, but usually only one at a time. Toys we saved for and paid cash.

I think one of the biggest things you have to do is make sure you and your spouse are on the same page, as far as finances. Make sure you have that talk before you get married.

I have friends that save nothing for retirement. I don't get it and ask them what are they going to do. Some say I will always work and one says I will get social security. I try to talk to them and ask how is that going to work, but they don't want to talk about it.
 
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Happy Smitty

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Understanding and tracking your net worth on a regular basis is the first part in setting financial goals. For those that haven't prepared a personal financial statement you'll likley be surprised when you see the numbers. Food for thought... your net worth may increase 100k in one year but you only saved $6,000 in cash contributions to your 401k.
 

BHC Vic

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I don’t know or care what my net worth is. I know I’m debt free except for The houses and boat. It’s actually a pretty good feeling. Houses should be paid off by the time I’m 50. I plan on retiring in my 60’s. I’ve got my annuity, my pension, and I do have money invested but I’m still learning how to maximize that.
 

DWC

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Just an FYI from someone who has been through a bankruptcy...They will take all your investment property...they pretty much take everything, but 401K's are untouchable.
Thanks for the tip. Didn’t know that but it makes sense.
 

Singleton

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I know my net worth, its my business and no one else’s. I don’t have a dollar number for when I will retire (my money man knows to maximize the money) and I have told him, I will retire when my youngest is 30.
Plus I got out of the measuring contest years ago, makes life easier.
 
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caribbean20

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I know my net worth, its my business and no one else’s. I don’t have a dollar number for when I will retire (my money man knows to maximize the money) and I have told him, I will retire when my youngest is 30.
Plus I got out of the measuring contest years ago, makes life easier.
I don’t think anyone is suggesting sharing or bragging about a very personal piece of information. Rather, it’s a good tool to ensure that when you’re in your late 80s you have the dignity to care for yourself out of your own funds and not be a burden on your kids. That, and maybe leave a little bit behind when you do cash it in, like our parents did for us.
 

Singleton

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I don’t think anyone is suggesting sharing or bragging about a very personal piece of information. Rather, it’s a good tool to ensure that when you’re in your late 80s you have the dignity to care for yourself out of your own funds and not be a burden on your kids. That, and maybe leave a little bit behind when you do cash it in, like our parents did for us.

But that is not net worth (since net worth accounts for assets that are not liquid). I know what my number is in liquid assets (cash and stock) that would allow me to retire and live how I want. When it hits that number, I am not retiring, but will continue to work until my youngest is 30. While the property I own and businesses I am part owner in are added to my new worth, I don’t count that value towards my retirement target.
 

rampster

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I know my net worth and track it monthly. Can anyone recommend a fee only financial advisor in Phoenix?
 

riverroyal

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Did they go to city college
This for me? No
Cal state school. We have been cutting checks for 6 years. Boys had a 2 year overlap which was tough
We told them to be successful and put in the work in high school and we would handle college. Deals a deal
We also did not feel starting a life as mid 20 adult with 75 to 100k in debt was a good idea.
Adjustments were made on our end financially to make it happen
Zero regrets.

Once they are done im getting a M37...lol
 

Universal Elements

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This for me? No
Cal state school. We have been cutting checks for 6 years. Boys had a 2 year overlap which was tough
We told them to be successful and put in the work in high school and we would handle college. Deals a deal
We also did not feel starting a life as mid 20 adult with 75 to 100k in debt was a good idea.
Adjustments were made on our end financially to make it happen
Zero regrets.

Once they are done im getting a M37...lol

That’s great. I have many friends who made similar deals. They are well off and their kids went to community colleges for their general. Transferred to universities and the parents paid the next 4 including their masters.
 

BHC Vic

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LOL what?
I go to work everyday and bust my ass. I hope I never have to claim bankruptcy, but if I do, I won’t be on here bragging about being a trophy husband and showing off boats, tahoe trips, and pool builds. I’m not wired that way. The trump comment is because he hates trump, but hes more like him than he would like to believe. Irony. (Bankruptcy, online trolling, etc)
 

CLdrinker

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I go to work everyday and bust my ass. I hope I never have to claim bankruptcy, but if I do, I won’t be on here bragging about being a trophy husband and showing off boats, tahoe trips, and pool builds. I’m not wired that way. The trump comment is because he hates trump, but hes more like him than he would like to believe. Irony. (Bankruptcy, online trolling, etc)
He doesn’t deserve to be compared to Trump.
 

DWC

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This for me? No
Cal state school. We have been cutting checks for 6 years. Boys had a 2 year overlap which was tough
We told them to be successful and put in the work in high school and we would handle college. Deals a deal
We also did not feel starting a life as mid 20 adult with 75 to 100k in debt was a good idea.
Adjustments were made on our end financially to make it happen
Zero regrets.

Once they are done im getting a M37...lol
Same program for us. Got one year left on the youngest. Deal was we’ll pay for 4 years. You wanna do it in 5 it’s on you. We split my daughters Masters for the first year. Once she got her job she started paying it. Start that college fund early for you younger parents....

No M37 in our future though. We’ll ride on yours.
 

BHC Vic

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Same program for us. Got one year left on the youngest. Deal was we’ll pay for 4 years. You wanna do it in 5 it’s on you. We split my daughters Masters for the first year. Once she got her job she started paying it. Start that college fund early for you younger parents....

No M37 in our future though. We’ll ride on yours.
How do you do the college funds? My wife has 3 started for the boys but how much should I be putting in there
 

Rajobigguy

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How do you do the college funds? My wife has 3 started for the boys but how much should I be putting in there
Short answer is as much as you stand to do without. Sent daughter to UCLA and it was 42000 a year four 4 yrs. then off to law school 72000 a year for three years. Save like you are going to incur this type of debt and if they choice not to take advantage of it then you can buy a new boat. Just to be fair my daughter did her part in funding her college tuition and I was not saddled with the entire cost.
 

CLdrinker

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Short answer is as much as you stand to do without. Sent daughter to UCLA and it was 42000 a year four 4 yrs. then off to law school 72000 a year for three years. Save like you are going to incur this type of debt and if they choice not to take advantage of it then you can buy a new boat. Just to be fair my daughter did her part in funding her college tuition and I was not saddled with the entire cost.
That’s crazy. Hope she makes Atleast 150k a year to start.
 
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