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Old 05-17-2012, 11:49 AM   #1
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Retirement

Mainsteam article on ten ways to pay for retirement:
http://finance.yahoo.com/news/10-way...132558046.html

1) Social Security: "The majority of retirees say they rely on Social Security as a major (57 percent) or minor (27 percent) source of retirement income"
Yep, no threat of social security ever going belly up!

2) 401k/IRA/ect: Not a bad part of your retirement portfolio, but watch out if a crash happens two weeks into your retirement!

3) A pension?!

4) Part time work: If I wanted to keep working, I wouldn't have retired!

5) Savings Account/CD:

6) Home Equity: Really, did we not learn our lesson in 2008?!

7) Stocks or stock mutual funds: see #2

8) Annuities: this works if you have no fear of any future inflation


9) Rental income: This one I do like. If inflation happens, raise the rent. If we get a whole new currency, charge rent in the new curreny.

10) An inheritance: So I can only retire if someone rich dies and leave me money?


How do you plan on paying for retirement? Sell one ounce of gold a month to pay for expenses?



P.S. With really long posts, limit of 4 smilies is annoying :<
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Old 05-17-2012, 12:08 PM   #2
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Originally Posted by benjamen View Post:
Sell one ounce of gold a month to pay for expenses?
This is exactly my plan at the moment but if gold goes to $5k and UK property prices remain roughly where they are, i will cash in, pay the CGT and buy a very special place that has everything i could want for long term survival.

The good thing about selling 12 oz per annum, is that you get to use any CGT allowance.

Suspect i will succumb to temptation and buy some bargain property at some point but my view on relying on rental income, is that its only good if your tenants can earn (or be given) the means to pay.
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Old 05-17-2012, 12:29 PM   #3
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A few questions/thoughts:

1) What is a "CGT allowance"?

2) Do you have to stay in the UK?

3) Rental income does not have to be only people; rent out grazing land? Grow and sell produce? Hunting lease?
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Old 05-17-2012, 12:31 PM   #4
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Uhoh, I've only got 30oz of gold so I don't have too long to....... Got a lot more Ag so hoping that'll skyrocket!

Edit: Well I do have some Pt and Pd so that'll help. And at these firesale prices would like to pick up a lil Rh. I mean just a few years ago it was $ 10,000! Now bout $1300.

Last edited by Bonzo; 05-17-2012 at 01:35 PM.
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Old 05-17-2012, 12:34 PM   #5
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Originally Posted by Bonzo View Post:
Uhoh, I've only got 30oz of gold so I don't have too long to....... Got a lot more Ag so hoping that'll skyrocket!
I usually calculate the value of all four precious metals in terms of ounces of gold. Effectively, liquidate one ounce of gold worth of precious metals a month in retirement.
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Old 05-17-2012, 12:40 PM   #6
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Thankfully Mrs. Ancona and I will not need the value of an ounce of gold a month in retirement. We are thinking that with the garden and some other set-asides we have made, we can make do on around two hundred and fifty bucks a week. Of course, we won't have cable TV, multiple phones, etc., but we will be able to eat something other than cat food.
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Old 05-17-2012, 03:07 PM   #7
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Originally Posted by benjamen View Post:
A few questions/thoughts:

1) What is a "CGT allowance"?

2) Do you have to stay in the UK?

3) Rental income does not have to be only people; rent out grazing land? Grow and sell produce? Hunting lease?
Sorry benjamen, dropped into blightyspeak

1) CGT = capital gains tax. The annual allowance is currently around £9k and it tends to more or less track inflation
so depending on the price paid and the gain, its possible that there could be no tax to pay on a big rise in the gold price. Its also a use it or loose it allowance, so it would be good to use it all, every year.

2) I would need to see things get really terrible to consider leaving my collective of bugouts and where would i go anyway. Think any areas that offered better prospects would be digging ditches across their approach roads (-;

3) Yes the dream property i would try to buy would offer just that. A farmhouse and land to rent out, either for fiats or food and a hilltop waterfilled quarry with loads of nice old quarry buildings and mucho woodland for rblong2us and his toys.
No point trying to get food from someone living in one of your apartments though.
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Old 05-17-2012, 03:14 PM   #8
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Originally Posted by benjamen View Post:
2) 401k/IRA/ect: Not a bad part of your retirement portfolio, but watch out if a crash happens two weeks into your retirement!
The 401k vehicle is now a non-starter for me. Read a book a while back called "The Coming Generational Storm." See link here:




One of the observations in that work is that any "pre-tax" vehicles effectively have a government lien against them because the feds are going to start looking for money anywhere they can and what they say today doesn't mean shit in the future.

And low and behold, look what we have here:

http://www.nypost.com/p/news/busines...lVsEIJj2IVgHuK

Full text:

Quote :
Feds eye retirement-fund tax to cut $16 trillion-plus deficit
By GREGORY BRESIGER
Last Updated: 8:25 AM, April 22, 2012
Posted: 11:16 PM, April 21, 2012

Uncle Sam, in a desperate attempt to fix its $16 trillion-plus deficit, is leering over Americans’ retirement nest egg as its new bailout fund.
Capitol Hill politicians are assessing tax changes that could let the Internal Revenue Service lay claim to a portion of the $18 trillion sitting in 401(k) accounts and other tax breaks used by middle-class workers, including cutting the mortgage tax deduction.

A commission looking for ways to close the deficit, and, noting the extent of 401(k) tax breaks, recommends an examination of the system as one way to prevent government bankruptcy.

Besides 401(k)s, other possibilities include the mortgage-interest deduction on second homes, as well as benefits from employer-provided health insurance, which are untaxed now.

Under current 401(k) rules, total employee/employer contributions can’t exceed $50,000. In the proposed rule change, employer/employee contributions would be limited to 20 percent of the employee’s compensation, with a maximum of $20,000, the so-called 20/20 proposal.

Another proposal being discussed in Congress says all tax deductions on 401(k)s and IRAs to be replaced with an 18 percent credit. The credit, according to a proposal that has been endorsed by economist William Gale, would be placed directly in a person’s retirement account.

“Unlike the current system,” Gale told Congress, “workers’ and firms’ contributions to employer-based 401(k) accounts would no longer be excluded from income and would be subject to taxation, contributions to IRAs would no longer be tax-deductible and any contributions to a 401(k) plan would be treated as taxable income.”

In other words, the employee and employer would no longer get a deduction under the Gale plan, they would qualify for a credit. And the credit would “increase [government] revenues by about $458 billion,” Gale says.
Last week a group of retirement industry experts went to Capitol Hill to criticize these proposed changes in retirement-plan rules. “These changes could have unintended consequences,” warns Lynn Dudley of the American Benefits Council (ABC).

Testifying before the House Ways and Means Committee about the proposals, Randolf Hardock, of ABC’s board of directors, said, “[The idea] could seriously undermine the retirement savings system.”

Jack VanDerhei, research director of Employee Benefit Research Institute (EBRI), believes either of the two proposed 401(k) changes under review would have a “catastrophic” effect on the current retirement saving system.
The 20/20 plan provisions curtailing non-taxable contributions would freeze out many higher-paid employees from signing up for a 401(k), which could lead some companies, according to critics, to question if plans would still be worth offering employees.

Reducing retirement-plan contributions for those at the higher end of the wage scale will inevitably have a bad effect on those in the middle and at the bottom, ABC’s Dudley says.

Read more: http://www.nypost.com/p/news/busines...#ixzz1v9z7ZF9T
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