Investing General Discussion

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Blazin

Blazin

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I mean you no insult so if you felt attacked I apologize. I have said weight of the evidence how many times now? I’m not dissing any of the metrics you mention. Cape is one data point and one that shiller himself has since admitted has led many people astray as a timing tool.

There are many things to watch and there are far more bullish data pts right now than bearish which is why we are in such a strong up trend . And again I don’t know why you feel the need to guess at anything respond to what is. The market price action is the final arbiter and right now it says up, that can change and I have unbiased approach and I’m ready to respond when it does.

you keep referring to there are two sides etc. and it’s this thinking that is wrong, analysis is for the purpose of revealing the current trend not predicting the future . I listed several major data pts for you months ago (several hundred s&p pts) not one of did you respond to.

Honest question how much more does the market (which is the net aggregate opinion of all market participants) have to move against your stance for you to think that maybe you aren’t looking at enough data? Based on your reasons you have assuredly been in this stance for years now.

I have no interest in a political thread argument. I am only trying to help you, if I sense you don’t want the help I’ll stop giving it. Someone who has already succeeded at the goal you are trying to accomplish is trying to help errors in thinking that I easily recognize in my own history , and overcoming it is life changing for an investor,
 
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Blazin

Blazin

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Well worth a watch a perfect example of how a data point can be improperly applied. Chris C gets it and is an excellent source to watch if reading FED reports doesn’t fit with your interest or schedule .

 
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Aychamo BanBan

Aychamo BanBan

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Khane said:
That's completely disingenuous. It's another account to setup, fund and convert and more paperwork to file and process during tax season. And you have to remember to do it every single year. Even a minor headache is still a headache and it's easier for someone like me to just work 40 extra hours a year than do something like this because I have to be diligent about what I did the calendar year before so I don't accidentally misappropriate those tax advantages each year by forgetting to claim and file correctly, which could lead to big penalties.

Don't act like it's a mere 5 minutes of brainless work...
Click to expand...

I hear you. But, for anyone interested, this is the only "extra paperwork" you have to file:

Generic-8606-Page-1.jpg
 
TJT

TJT

Mr. Poopybutthole
<Gold Donor>
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Falxy-US said:
I hear you. But, for anyone interested, this is the only "extra paperwork" you have to file:

Generic-8606-Page-1.jpg
Click to expand...

So if you do this backdoor Roth IRA, does it create a new separate account for it each year or can you backdoor it into a grouped account?
 
Aychamo BanBan

Aychamo BanBan

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TJT said:
So if you do this backdoor Roth IRA, does it create a new separate account for it each year or can you backdoor it into a grouped account?
Click to expand...

It rolls it into the Roth IRA of your choosing. So to answer, I have one Roth IRA with numerous years of backdoor contributions.
 
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Aychamo BanBan

Aychamo BanBan

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Cad said:
Thats not really that inconvenient.
Click to expand...

It's not inconvenient at all. I just didn't want to internet fight with Khane. It takes me about 2 minutes to fund the IRA, then you come back a couple of days later and click like 3 things to convert it to a Roth IRA, so total time is about 5 minutes now. Then you do one extra thing with taxes at the end of the year.
 
Khane

Khane

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Well, I've got income in 2 different states, my investment property, my regular investment accounts. Also have an HSA, FSA, a UGMA for my niece. It's easy (for me) to accidentally forget something like this and the gain won't be very significant for me. It's a hassle. In a silo it's a breeze but different people have different levels of what they'd call inconvenient.

I should probably just pay an accountant at this point instead of doing all my taxes myself, honestly.

I also have no debt, literally none, and could semi-retire today and go work as a starter at a golf course somewhere warm year round and live comfortably for the rest of my life. So I'm pretty meh on the tax advantages of this.
 
Aychamo BanBan

Aychamo BanBan

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Khane said:
Well, I've got income in 2 different states, my investment property, my regular investment accounts. Also have an HSA, FSA, a UGMA for my niece. It's easy (for me) to accidentally forget something like this and the gain won't be very significant for me. It's a hassle. In a silo it's a breeze but different people have different levels of what they'd call inconvenient.

I should probably just pay an accountant at this point instead of doing all my taxes myself, honestly.

I also have no debt, literally none, and could semi-retire today and go work as a starter at a golf course somewhere warm year round and live comfortably for the rest of my life. So I'm pretty meh on the tax advantages of this.
Click to expand...

Hows the investment property working out for you? Is that paid off too? Any headaches? I've been debating getting into some residential real estate stuff, but it seems like the "cash flow" is just so insignificant. I'm looking at one property (on Zillow), $115,000, so that would be $28,750 down, plus closing costs, so like $34,000 down, and would cash flow around $500/month. That's $6000/yr, which I guess is a high cash on cash return (17%). I think it just emotionally kills me to put out $34,000. Do you like being in real estate too or do you have regrets? My other thoughts for real estate are FundRise.com, and just putting whatever $ amount in a REIT.
 
Khane

Khane

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Being a landlord is a major PITA. We've discussed this a lot in the home buying thread (I think that's the right thread). I own this property outright and the net income on it would be quite significant if I didn't live in one of the apartments myself (it's a duplex). As it stands now I net ~$8k/yr on a typical year. I could get another $18k/yr for the apartment I live in, in this market.

I would own more but as you may have deduced from this thread I have a low tolerance for inconveniences.
 
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Cad

Cad

scientia potentia est
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Khane said:
Being a landlord is a major PITA. We've discussed this a lot in the home buying thread (I think that's the right thread). I own this property outright and the net income on it would be quite significant if I didn't live in one of the apartments myself (it's a duplex). As it stands now I net ~$8k/yr on a typical year. I could get another $18k/yr for the apartment I live in, in this market.

I would own more but as you may have deduced from this thread I have a low tolerance for inconveniences.
Click to expand...

How do you account for the capital expenditures in that $8k/yr? Broken A/C, plumbing, carpet, general repairs, etc? How much are those eating out of your cash flow?
 
Khane

Khane

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It's nothing fancy, it's just the average spend per year over the 11 years I've owned it. Which includes all the above and things like Landscaping and small home improvements.

The apartment's gross rental income is $20,100/yr. Taxes + Insurance are ~$7,500/yr and I spend roughly $4,500 maintaining the property each year. Which is quite high because I've had a lot of things go wrong over the years and the first floor is now entirely remodeled and I have a brand new fence up which will hopefully lower that yearly maintenance number
 
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Cad

Cad

scientia potentia est
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Khane said:
It's nothing fancy, it's just the average spend per year over the 11 years I've owned it. Which includes all the above and things like Landscaping and small home improvements.

The apartment's gross rental income is $20,100/yr. Taxes + Insurance are ~$7,500/yr and I spend roughly $4,500 maintaining the property each year. Which is quite high because I've had a lot of things go wrong over the years and the first floor is now entirely remodeled and I have a brand new fence up which will hopefully lower that yearly maintenance number
Click to expand...

Thats pretty good, thanks
 
LachiusTZ

LachiusTZ

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Cad Cad

Dont you have some ownership in some jackassery partnership passive loss that pays you in wine or someshit to offset your potential rental income?
 
Frenzied Wombat

Frenzied Wombat

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I've looked into buying some rental properties as a source of passive income, but unless my calculations have been off, unless I can buy it outright at best I'd be breaking even. When I add up mortgage payments, taxes on rental income, property taxes, and repairs/insurance, the rent I'd need to charge to be competitive would basically allow me to break even. That's self managed too, with a management company there's no way I could pull a profit. Assuming no "surprises" (yeah right), at best I'm just gaining equity in the property.

Like my old 2000 sq foot townhome that I repaired and considered renting rather than selling:

$1500/month mortgage payment
$100/month insurance
$700/month property tax
estimated $200 month repairs, factoring in long term replacement of HVAC, roof, ec, as well as damage by tenant

So that's $2500/month before I factor in income taxes on revenue. I'd basically need to charge like 3k a month just to break even, which is about pushing the limit on what the going rate would be.
 
LachiusTZ

LachiusTZ

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If we do burst a bubble, the mortgage note can also bankrupt you.

I bought my home in Memphis for 105k, now worth 180k.

Mortgage is 800/mo. I charge below rate rent because I've had the same tenants for a couple of years. 1350/mo

MGMT takes .09*1350

I am below the cutoff for passive losses.

I'm just gaining equity and appreciation, and put the extra into the mortgage.

Going to sell it this spring unless the bottom falls out.

So it's cash flow positive, with negative tax impact because of interest and depreciation.

Also might refinance it, not sure.

Will figure it out in March
 
Khane

Khane

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Residential investment properties aren't really short term winners. They're long term income. Think of it as a retirement plan rather than a portfolio option. Eventually the property is going to be paid off and all you have to cover is taxes, insurance and maintenance/upkeep.
 
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