Author Topic: What about a Successful Business or Long Term Investment Scenario?  (Read 23740 times)

Freeyourchains2

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Well what about another important "possible scenario" that hasn't been covered in these threads yet, like a successful business or a successful long term investment scenario?

If your financial Goal is financial independence before age 59.5 that is!!!
BTW age restrictions are very vital to this "possible scenario".

Say i am great at long term trading and/or making successful businesses.

Inside my IRA:
I contribute $5k per year.

And say I am age 25.

Say i make 120% returns per year for 10.75 years, effectively doubling my investments year after year, with $5k contributions adding to the investments.

I will have compounded over 1 Billion dollars in earnings within my IRA account in 10.75 years.

Unfortunately due to age restrictions on IRA account earnings, I can only withdraw my contributions of $50k before age 59.5 without extreme taxes and penalty fees, of ordinary income taxes (40% + 18% in FICA taxes) and the 10% penalty fee .

Plus any other potential future 401k/IRA taxes from this treasure trove of citizen's wealth that the government is currently drooling over and is wanting  (but that nose dives into politics, and we won't assume any future law changes here).

68% of 1 Billion dollars is $680 million dollars the government taxes away from me if I want to retire extremely early, like age 35 after making 1 Billion dollars in my IRA account.

Now if i long term traded in a taxable account, or started up a successful business toward a 1 Billion dollar IPO, and made 120% returns per year for 13 years to reach my 1 Billion dollar goal;

Then if i held my stocks for a decade, and those stocks doubled per year or, grew in a way such as multiple splits, paid dividends, plus stock increases like Exxon Mobile in 1987-1997, etc;

I would only be taxed 20% upon selling my shares for Capital Gains, and 15% on dividends over $150k or 20% on the dividends over $1 million in income each year.

Thus at age 38, My $1 Billion would be taxed 20% + .6%(20% of 3-5% dividends payouts, the longer 13 years total accounts for dividend taxes)

IRA account early withdrawal: $680 Million in taxes ( taxes and penalties, 68%, at age 35)

Taxable account or successful business: $206 Million  in taxes. ( Long Term Capital Gains/dividend taxes, 20.6% at age 38)

Conclusion. IRA's are really made for saving for physical retirement from age 59.5 up. However if you want to start a business or take a risk and hold for a decade in some high quality stocks with a lot of potential growth, and you believe your reward will be a Billion dollars in a decade:

Earnings inside your IRA won't help you for extremely early retirement aka FI, because they are age restricted until age 59.5; yet tax and penalty free then, if you are still alive.

Earnings from Taxable accounts or successful Business IPOs have no age restrictions and can get you to FI at any age, based on your skills, risk, and persistence.

BUT this is only for that "possible scenario". One of many differing individual situations from all types of skilled people, and people who like various investment vehicles, or have many other financial goals and ages in their lives that they would like to retire.

matchewed

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Re: What about a Successful Business or Long Term Investment Scenario?
« Reply #1 on: June 25, 2013, 09:02:47 AM »
Your conclusion is based on an entirely unrealistic example. You do not consider the multitude of investment vehicles used to achieve the flexibility of getting to FIRE while using tax advantaged accounts nor how to use them appropriately. Even ignoring the insane returns that are impossible to achieve
1) You do not pay FICA
2) To achieve that 40% you'll have to be withdrawing 400k for individuals or 450k for couples.
3) Try a more reasonable expense assumption for your example.
4) Factor in Roth IRA's, regular IRA's, 401k's, and taxable accounts instead of this strawman of an example.

matchewed

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Re: What about a Successful Business or Long Term Investment Scenario?
« Reply #2 on: June 25, 2013, 09:17:58 AM »
A closer comparison to your scenario is you have enough in your Roth to cover five years worth of expenses. You pay income taxes on your roll over amount. For those taxes we'll assume 30k in expenses per year putting you at 15% bracket. That's it for taxes ignoring state. So you're able to grow your money tax free until you roll over and pay income tax.

In the taxable account scenario you've already paid income taxes once when you earned it. Let's say you earn 60k a year. So you're paying in the 25% bracket once upon receiving the money then you're paying long term capital gains. Given today's rules you're paying 0% if you're in the 15% bracket keeping with the example above. So you get to grow your money while it's being taxed with dividends.

So which is a larger amount? Paying 25% bracket upfront and 25% taxes on dividends on going or 15% bracket later? I can run a better example with more numbers later but this is the center of the question. The rules governing these are currently easily able to be worked around. It comes down to what costs you more money. Focusing on taxable accounts for FIRE is doable, but not optimal.

workwheniwantto

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Re: What about a Successful Business or Long Term Investment Scenario?
« Reply #3 on: June 25, 2013, 10:24:11 AM »
I was under the impression from several sources that you could "annuitize" (over your life expectancy) your withdrawal of IRA funds at any age, with no penalty. 

Freeyourchains2 - do you have an emotional or psychological objection to retirement accounts, a financial incentive to discourage others from doing so, or an emotional or psychological payoff from being contrarian on these boards?  It seems to be your primary focus on here, even though everyone I have read disagrees with your premise and approach. 

arebelspy

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Re: What about a Successful Business or Long Term Investment Scenario?
« Reply #4 on: June 25, 2013, 10:28:17 AM »
I was under the impression from several sources that you could "annuitize" (over your life expectancy) your withdrawal of IRA funds at any age, with no penalty. 

That's a decent way of summarizing it.  It's called a 72(t), or SEPP (Substantially Equal Periodic Payment).
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Eric

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Re: What about a Successful Business or Long Term Investment Scenario?
« Reply #5 on: June 25, 2013, 11:08:53 AM »
Only a billion dollars?  That's it?  However would you be able to afford to pay taxes on that pitiful amount? 

matchewed

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Re: What about a Successful Business or Long Term Investment Scenario?
« Reply #6 on: June 25, 2013, 11:27:41 AM »
Also math demonstrating that using tax deferred saves you more money. See attached. I can revisit the workbook and do drawdown scenarios some other time.

Undecided

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Re: What about a Successful Business or Long Term Investment Scenario?
« Reply #7 on: June 25, 2013, 12:28:37 PM »
BUT this is only for that "possible scenario". One of many differing individual situations from all types of skilled people, and people who like various investment vehicles, or have many other financial goals and ages in their lives that they would like to retire.

Yes, one should consider and understand all of the implications of alternative investment structures in light of one's personal goals and expected investments.

For the strategies that most people who participate here are deploying, there are many scenarios in which using tax-advantaged accounts to the extent available will produce superior outcomes.

Of course, one may forgo tax-advantaged accounts if one's personal strategy demands it, but the mere possibility that one may retrospectively come to the conclusion that the sure thing (the tax advantage) impacted one's ability to take advantage of an unforeseen opportunity doesn't necessarily justify that.

Also, your illustration did not fairly consider the accessibility of the IRA funds under a 72(t) withdrawal plan.

Freeyourchains2

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Re: What about a Successful Business or Long Term Investment Scenario?
« Reply #8 on: June 25, 2013, 01:08:33 PM »
A closer comparison to your scenario is you have enough in your Roth to cover five years worth of expenses. You pay income taxes on your roll over amount. For those taxes we'll assume 30k in expenses per year putting you at 15% bracket. That's it for taxes ignoring state. So you're able to grow your money tax free until you roll over and pay income tax.

In the taxable account scenario you've already paid income taxes once when you earned it. Let's say you earn 60k a year. So you're paying in the 25% bracket once upon receiving the money then you're paying long term capital gains. Given today's rules you're paying 0% if you're in the 15% bracket keeping with the example above. So you get to grow your money while it's being taxed with dividends.

So which is a larger amount? Paying 25% bracket upfront and 25% taxes on dividends on going or 15% bracket later? I can run a better example with more numbers later but this is the center of the question. The rules governing these are currently easily able to be worked around. It comes down to what costs you more money. Focusing on taxable accounts for FIRE is doable, but not optimal.

You are forgetting some things from the 401k and IRA side of "fees".

401k fee's, One small example.

Plan fees: Participant Charges of $10-$25 per year.

 Contract Asset Charges CAC 0.23%-2.02% annually of total assets inside 401k, assessed variable rate on a month to month basis by them.

1% expense ratio fees average.

any Asset-Based Fees, like $2.50 per deposit + comissions fees.

TAP (third party distribution fees of around $100 per distribution) Either for distributions upon death, lump sum withdraw, installments, etc.

Then Surrender Charges: Depending on the specific underwriting of the Contract, upon total or partial discontinuance of the Contract, an asset-based surrender/discontinuance charge may apply for a limited number of deposit years.

You do not participate in any proxy voting. (thus all votes are for CEO salary, bonus, and share increases automatically or via a bribe to the 401k Fund managers for their millions of votes)

This all makes you want to switch jobs doesn't it?!! And run away from their bad 401k plans.




But yes, there are multiply ways to FI. Taxable or Non-taxable have various options to consider and between their taxes and fees in the present and the future.

Dividends can be 25% upfront in taxes per year; then at FI, 0% taxes per year for the rest of your life, as your dividends cover your expenses, and if your expenses are less then $35k per individual single filer. $85k for married.

The other option is 401k fees, then closing/distribution fees to rollover to IRA from 401k contracts, 5 years prior to your FI date, because of the "grace" period. But then your deferred taxes on distributions from your initial 401k contributions only (not earnings) are between 15-25% upon the grace period per year based on  $35k income for expenses per individual filer, or less then $85k income if married.

You deferred the taxes to a lower amount, but you have to account for the additional fees per year initially and at the end/during the multiply roll-overs. 3% of $100k = $3,000/year. $14/month = $168/year (trading month to month)




matchewed

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Re: What about a Successful Business or Long Term Investment Scenario?
« Reply #9 on: June 25, 2013, 01:22:49 PM »
Instead of screaming FEES at me can you please actually apply them in the correct manner in which they would be used in the real world to a scenario. Or perhaps I can just educate myself on what funds have what fees and invest accordingly. Plus the 401k itself does not have fees, the funds you invest in have fees. So perhaps my second sentence is the most accurate of this, understand your investment options.

As an N=1 anecdote I pulled up my entire 401k transaction history. You know what you're right there are fees with the funds I chose. From 2008 to 2010 I was given a record keeping fee for two funds. Both funds stopped applying the fee in 2010. And it racked up to a total of $112.50. I will never get that money back (/tear slowly drifting down face). But I will be damn glad I didn't pay thousands if not tens of thousands in taxes.

arebelspy

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Re: What about a Successful Business or Long Term Investment Scenario?
« Reply #10 on: June 25, 2013, 01:25:57 PM »
You are forgetting some things from the 401k and IRA side of "fees".

401k fee's, One small example.

Plan fees: Participant Charges of $10-$25 per year.

 Contract Asset Charges CAC 0.23%-2.02% annually of total assets inside 401k, assessed variable rate on a month to month basis by them.

1% expense ratio fees average.

any Asset-Based Fees, like $2.50 per deposit + comissions fees.

TAP (third party distribution fees of around $100 per distribution) Either for distributions upon death, lump sum withdraw, installments, etc.

Then Surrender Charges: Depending on the specific underwriting of the Contract, upon total or partial discontinuance of the Contract, an asset-based surrender/discontinuance charge may apply for a limited number of deposit years.

You do not participate in any proxy voting. (thus all votes are for CEO salary, bonus, and share increases automatically or via a bribe to the 401k Fund managers for their millions of votes)

This all makes you want to switch jobs doesn't it?!! And run away from their bad 401k plans.

My 403b and 457b are both with Fidelity.  No annual fees, no surrender charges, freedom in what I invest in, etc.  I'm invested in an index fund with a 0.22% expense ratio, about the same as my taxable accounts.

No fees.  Whatsoever. 
« Last Edit: June 25, 2013, 01:31:40 PM by arebelspy »
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brewer12345

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Re: What about a Successful Business or Long Term Investment Scenario?
« Reply #11 on: June 25, 2013, 01:29:58 PM »
Hey butt monkey:

Are you really still banging this gong?  Your posited nonsense is so far removed from reality nobody knows where to begin.  My 401k charges 25 basis points annually for example.  Of course, I could just respond that your strategy is perfect if you grow three dicks and ride a purple unicorn to work every day.

[[/img]quote author=matchewed link=topic=6608.msg100382#msg100382 date=1372173478]
A closer comparison to your scenario is you have enough in your Roth to cover five years worth of expenses. You pay income taxes on your roll over amount. For those taxes we'll assume 30k in expenses per year putting you at 15% bracket. That's it for taxes ignoring state. So you're able to grow your money tax free until you roll over and pay income tax.

In the taxable account scenario you've already paid income taxes once when you earned it. Let's say you earn 60k a year. So you're paying in the 25% bracket once upon receiving the money then you're paying long term capital gains. Given today's rules you're paying 0% if you're in the 15% bracket keeping with the example above. So you get to grow your money while it's being taxed with dividends.

So which is a larger amount? Paying 25% bracket upfront and 25% taxes on dividends on going or 15% bracket later? I can run a better example with more numbers later but this is the center of the question. The rules governing these are currently easily able to be worked around. It comes down to what costs you more money. Focusing on taxable accounts for FIRE is doable, but not optimal.

You are forgetting some things from the 401k and IRA side of "fees".

401k fee's, One small example.

Plan fees: Participant Charges of $10-$25 per year.

 Contract Asset Charges CAC 0.23%-2.02% annually of total assets inside 401k, assessed variable rate on a month to month basis by them.

1% expense ratio fees average.

any Asset-Based Fees, like $2.50 per deposit + comissions fees.

TAP (third party distribution fees of around $100 per distribution) Either for distributions upon death, lump sum withdraw, installments, etc.

Then Surrender Charges: Depending on the specific underwriting of the Contract, upon total or partial discontinuance of the Contract, an asset-based surrender/discontinuance charge may apply for a limited number of deposit years.

You do not participate in any proxy voting. (thus all votes are for CEO salary, bonus, and share increases automatically or via a bribe to the 401k Fund managers for their millions of votes)

This all makes you want to switch jobs doesn't it?!! And run away from their bad 401k plans.




But yes, there are multiply ways to FI. Taxable or Non-taxable have various options to consider and between their taxes and fees in the present and the future.

Dividends can be 25% upfront in taxes per year; then at FI, 0% taxes per year for the rest of your life, as your dividends cover your expenses, and if your expenses are less then $35k per individual single filer. $85k for married.

The other option is 401k fees, then closing/distribution fees to rollover to IRA from 401k contracts, 5 years prior to your FI date, because of the "grace" period. But then your deferred taxes on distributions from your initial 401k contributions only (not earnings) are between 15-25% upon the grace period per year based on  $35k income for expenses per individual filer, or less then $85k income if married.

You deferred the taxes to a lower amount, but you have to account for the additional fees per year initially and at the end/during the multiply roll-overs. 3% of $100k = $3,000/year. $14/month = $168/year (trading month to month)
[/quote]

Undecided

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Re: What about a Successful Business or Long Term Investment Scenario?
« Reply #12 on: June 25, 2013, 01:34:05 PM »
You are forgetting some things from the 401k and IRA side of "fees".

Fees are relevant, of course, and if the fee structure that applies to the tax-advantaged investments available to a person is very different from alternatives (whether taxable investments or different tax-advantaged investments), then that's relevant to a decision.

However, the fees you claim don't reflect the fees I see in my 401(k), my wife's solo 401(k) or our Roth IRAs.

In my 401(k), I have Vanguard "institutional" index funds that have fees on the order of .05%. I do pay an annual administrative fee, but it works out to approximately .001%. Other than the ordinary fund fees of about .05% to .3% in most cases, depending on fund, we pay none of the other fees you mention on investments in my wife's solo 401(k) or our IRAs.

It's hard to credit your argument when you cite no sources and assert assumptions that don't reflect what I know to apply to my investments.

matchewed

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Re: What about a Successful Business or Long Term Investment Scenario?
« Reply #13 on: June 25, 2013, 01:40:46 PM »
My 401k's options and fees (including all the hidden scary ones too)
Name/Inception Date   Gross Expense Ratio**   Shareholder Fees
ABF LG CAP VAL INV (AAGPX) 08/01/1994    0.97%   No additional fees apply.
FID CAPITAL APPREC (FDCAX) 11/26/1986    0.96%   No additional fees apply.
FID DIVIDEND GR (FDGFX) 04/27/1993            0.93%   No additional fees apply.
FID EQ DIV INCOME (FEQTX) 08/21/1990     0.67%   No additional fees apply.
FID GROWTH COMPANY (FDGRX) 01/17/1983  0.90%   No additional fees apply.
FID INDEPENDENCE (FDFFX) 03/25/1983     0.78%   No additional fees apply.
SPTN 500 INDEX ADV (FUSVX) 02/17/1988     0.07%   No additional fees apply.
ARTISAN MID CAP INV (ARTMX) 06/27/1997     1.33%   No additional fees apply.
FID LOW PRICED STK (FLPSX) 12/27/1989     0.88%   Short term trading fees of 1.5% for shares held less than 90 days.
RDGWTH MID CAP VAL I (SMVTX) 11/30/2001    1.07%    No additional fees apply.
LOOMIS SM CAP VAL R (LSCRX) 12/31/1996    1.38%   No additional fees apply.
FID DIVERSIFD INTL (FDIVX) 12/27/1991     1.01%   Short term trading fees of 1% for shares held less than 30 days.
SPTN INTL INDEX ADV (FSIVX) 11/05/1997    0.17%   Short term trading fees of 1% for shares held less than 90 days.
FID FREEDOM 2000 (FFFBX) 10/17/1996       0.45%   No additional fees apply.
FID FREEDOM 2005 (FFFVX) 11/06/2003            0.53%   No additional fees apply.
FID FREEDOM 2010 (FFFCX) 10/17/1996      0.61%   No additional fees apply.
FID FREEDOM 2015 (FFVFX) 11/06/2003     0.62%   No additional fees apply.
FID FREEDOM 2020 (FFFDX) 10/17/1996     0.65%   No additional fees apply.
FID FREEDOM 2025 (FFTWX) 11/06/2003    0.72%   No additional fees apply.
FID FREEDOM 2030 (FFFEX) 10/17/1996     0.74%   No additional fees apply.
FID FREEDOM 2035 (FFTHX) 11/06/2003     0.79%   No additional fees apply.
FID FREEDOM 2040 (FFFFX) 09/06/2000     0.79%   No additional fees apply.
FID FREEDOM 2045 (FFFGX) 06/01/2006     0.80%   No additional fees apply.
FID FREEDOM 2050 (FFFHX) 06/01/2006     0.81%   No additional fees apply.
FID FREEDOM 2055 (FDEEX) 06/01/2011     0.82%   No additional fees apply.
FID FREEDOM INCOME (FFFAX) 10/17/1996    0.45%   No additional fees apply.
PIMCO TOTRETURN ADM (PTRAX) 09/08/1994    0.71%   No additional fees apply.
SPTN US BOND IDX ADV (FSITX) 03/08/1990    0.17%   No additional fees apply.
FID RETIRE MMKT (FRTXX) 12/02/1988 7 day yield as of 05/31/2013   0.01%    0.42%   No additional fees apply.

Hmm that's an awful lot of no additional fees. Do I trust fear mongering or prospectuses, communications, and my own research?

Freeyourchains2

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Re: What about a Successful Business or Long Term Investment Scenario?
« Reply #14 on: June 25, 2013, 02:11:05 PM »
I was under the impression from several sources that you could "annuitize" (over your life expectancy) your withdrawal of IRA funds at any age, with no penalty. 

That's a decent way of summarizing it.  It's called a 72(t), or SEPP (Substantially Equal Periodic Payment).

Here is an interesting article on the restrictions to a 72(t) plan, all based on your "AGE" again. [why is the government so discriminating against Age?] Jezz i just want to retire in 10 years, and not have to jump from burning plane to burning plane just to survive.

http://www.forbes.com/sites/advisor/2012/02/13/the-72t-early-distribution-from-your-ira/

"An Important Note:
It’s important to know that the amounts you’ve calculated are and will be the exact figures for your payments from the account, no more, no less. It’s not allowable to simply name your own amount and take that amount each year – you have to use the prescribed amount from one of the methods.

The way to impact the amount of the payment is to adjust the balance in the IRA. If you have more than one IRA available, you can rollover funds into one account and therefore increase or decrease your payment. This has to be done prior to establishing the SOSEPP though – it’s not allowed for you to deposit money into or remove funds from your IRA while the SOSEPP is in place (well, other than the required payments from the account each year).

Any deviation from the prescribed payments will cause the SOSEPP to be “busted”, which can result in some not-so-nice consequences – which you can read more about here. For more about the SOSEPP, see the IRA Owner’s Manual."


But thank you everyone for you excellent responses! Believe it or not, you all are answering my questions well.

I know Mitt Romeny runs his companies from an IRA point of View. Does anyone here do the same thing? Because i do wish to startup my own business, yet i can't see fully how i can have the freedom to do so that from an IRA account.

Undecided

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Re: What about a Successful Business or Long Term Investment Scenario?
« Reply #15 on: June 25, 2013, 02:34:05 PM »
I was under the impression from several sources that you could "annuitize" (over your life expectancy) your withdrawal of IRA funds at any age, with no penalty. 

That's a decent way of summarizing it.  It's called a 72(t), or SEPP (Substantially Equal Periodic Payment).

I know Mitt Romeny runs his companies from an IRA point of View. Does anyone here do the same thing? Because i do wish to startup my own business, yet i can't see fully how i can have the freedom to do so that from an IRA account.

I don't know what Mitt Romney does (or what you think you know Mitt Romney does), but read about "prohibited transactions" and "disqualified persons" regarding IRAs. Generally, your IRA is not intended to be (meaning, the tax regulations that advantage it do not permit it to be) used for any purpose under the sun (without losing those advantages), and especially not for your active use in a business capacity or for your personal use of the amounts that are still advantaged. That's a completely legitimate government approach, in my view, offering some benefit for limited amounts of money and limited purposes, generally in support of securing retirement. If you have a reason to pass up those advantages because you want the money for a disallowed purpose, that's fine, you're free to make that choice, but it doesn't in any way make the combination of benefits and restrictions that apply to IRAs or 401(k)s somehow illogical or unfair.


workwheniwantto

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Re: What about a Successful Business or Long Term Investment Scenario?
« Reply #16 on: June 25, 2013, 07:13:27 PM »
Generally, your IRA is not intended to be ... used for any purpose under the sun (without losing those advantages), and especially not for ... a business capacity ...


FWIW, it can be used to own/run a business where the fund itself is the sole beneficiary.  Of course, it is a paperwork nightmare and it is then subject to UBIT, which is effectively equal to the highest income tax rate in USA.  Of course, that could be close to the same as (or lower than) the 25% tax rate + FICA + State + Local taxes....

Undecided

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Re: What about a Successful Business or Long Term Investment Scenario?
« Reply #17 on: June 25, 2013, 09:23:18 PM »
Generally, your IRA is not intended to be ... used for any purpose under the sun (without losing those advantages), and especially not for ... a business capacity ...


FWIW, it can be used to own/run a business where the fund itself is the sole beneficiary.  Of course, it is a paperwork nightmare and it is then subject to UBIT, which is effectively equal to the highest income tax rate in USA.  Of course, that could be close to the same as (or lower than) the 25% tax rate + FICA + State + Local taxes....

You might want to consider what you edited out when you quoted me, because your portrayal of using an IRA to "own/run a business" is significantly incomplete: While "it" can own a business, it would have to use third-party management and labor to operate it, to avoid engaging in a prohibited transaction. That's why I wrote that it is "not for your active usein a business... ." Given that the OP was asking about a "startup," I don't see how that would work (unless it's somebody else's idea and labor, which doesn't sound like what someone means by "startup my own business").

DoubleDown

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Re: What about a Successful Business or Long Term Investment Scenario?
« Reply #18 on: June 26, 2013, 08:46:46 AM »
Say i make 120% returns per year for 10.75 years, effectively doubling my investments year after year, with $5k contributions adding to the investments.

I will have compounded over 1 Billion dollars in earnings within my IRA account in 10.75 years.


Sir, I would like to invest in your business that will earn $1 billion in under 11 years at 120% returns each year. I have my checkbook ready, to whom do I make the check? Will you accept an initial investment of $100,000?

kyleaaa

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Re: What about a Successful Business or Long Term Investment Scenario?
« Reply #19 on: June 26, 2013, 09:55:52 AM »
Well, you wouldn't pay a 68% tax rate, for starters, not even with an early withdrawal penalty. You also aren't going to earn 120% per year on your investments over a 10 year period. Never in the history of the world has that ever been done and chances are it never will be. Besides, there are easy ways to avoid that penalty and still withdraw the money early. I would say if you end up with several hundred million dollars anyway, it's not something worth worrying about. Good luck with that.
« Last Edit: June 26, 2013, 09:58:09 AM by kyleaaa »

Freeyourchains2

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Re: What about a Successful Business or Long Term Investment Scenario?
« Reply #20 on: June 26, 2013, 12:58:57 PM »
You also aren't going to earn 120% per year on your investments over a 10 year period. Never in the history of the world has that ever been done and chances are it never will be. Besides, there are easy ways to avoid that penalty and still withdraw the money early. I would say if you end up with several hundred million dollars anyway, it's not something worth worrying about. Good luck with that.

As Mitt Romeny said to the Middle class Americans, "Capital Gains and business success".

120% per year is happening all around you! Just like million dollar ideas have been implemented and sold to you and are on your desks right now as you use them daily or yearly.

With stock splits, Or in simple company growth!

See attached for one small example for Exxon Mobile growth.

2x 2:1 splits in less then a decade, Plus stock prices tripling.

100 shares at $10.24 initially bought, then yields 400 shares at $30.65, plus dividends.

$1,024 turns into  $13,747 over a decade.

So 34% growth per year.

But we are looking for examples that doubled your investments per year right!!!

LVS 2010 (las Vegas Sands), 146% return.
NFLX June of last year to today (Netflix after the crash) 212% return.
TSLA June of last year to today (Tesla Electric Car boom and craze) 233%
And these are just mid caps that i invested in after intensive research.
Etc.

"Buy very low on way undervalued, overly hyped companies; sell very high on way overvalued, overly hyped companies" ~Warren Buffet.

Yes it's hard to do and predict because you need investing skills and experience, but it does happen all around us every year. Just like how some businesses bloom and become successful.

You work hard, then plant seeds which take a risk yet if you or others grow and monitor it, and it provides you with bountiful fruit.






matchewed

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Re: What about a Successful Business or Long Term Investment Scenario?
« Reply #21 on: June 26, 2013, 01:15:08 PM »
If all it take is skills (are you sure you don't mean skillz? I think they're two different things) and experience then why aren't there more Buffets out there?

Look I can also find a bunch of companies that had negative returns or failed in certain time frames. And plenty of people placed bets on those failures. What makes the difference in that selection? Also what does this have to do with the argument between using tax advantaged accounts and standard taxable brokerage accounts?

workwheniwantto

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Re: What about a Successful Business or Long Term Investment Scenario?
« Reply #22 on: June 26, 2013, 01:22:13 PM »
Undecided, I apologize for glossing the context.  I believe you are right, though I have one caveat - I think you can "manage" the business, depending on what that entails.  I was coming from my frame of reference - for me, the only "business" I want in my retirement account is real estate, so I need to be concerned with properties I sell too quickly - since that is considered a business, even if no "sweat" was put into the equity. 

Freeyourchains2 - I want to believe you are successful at stock picking, although it is difficult to fathom since your assumptions on tax planning are so far afield.  I am absolutely serious when I say I would love to be kept abreast of all your stock moves going forward - if you prove to be the value investing god that dwarfs Buffet and Graham, then I may want to follow your lead and pay you handsomely for your insight.  And I promise to verify the level of your successes with everyone. 

As for the rest of this thread, can we all just agree that Freeyourchains2 is absolutely right, that we are wasting our time and showing our ignorance by responding with differing opinions, and congratulate him now for his future unceasing successes in picking the best performing stocks each year. 

arebelspy

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Re: What about a Successful Business or Long Term Investment Scenario?
« Reply #23 on: June 26, 2013, 01:51:25 PM »
As for the rest of this thread, can we all just agree that Freeyourchains2 is absolutely right, that we are wasting our time and showing our ignorance by responding with differing opinions, and congratulate him now for his future unceasing successes in picking the best performing stocks each year.

Who am I to argue with a billionaire?

I will ask one question though.

FreeYourChains: Those were all examples of companies that returned 100%+ over the past year.  That doesn't really help me, as my time machine is not yet perfected.  Can you please give me 3 or 4 examples of ones that will return over 100% in the next (upcoming) year?  Thanks!
We are two former teachers who accumulated a bunch of real estate, retired at 29, spent some time traveling the world full time and are now settled with three kids.
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Re: What about a Successful Business or Long Term Investment Scenario?
« Reply #24 on: June 26, 2013, 02:37:25 PM »
@FreeYourChains2 I don't think you understand how to use Google Finance's tools. You do realize that it shows you what one share of the current Exxon Mobile would have been worth back in 1987. So it was really something like 100 shares at ~$80 a share and when your time frame ended you would have had 400 shares valued at ~$60 a share.

So if you had bought 100 shares for ~$8,000 and ten years later had ~$24,000+dividends, but that is more like a 300% return not a 1300% return.
 

DoubleDown

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Re: What about a Successful Business or Long Term Investment Scenario?
« Reply #25 on: June 26, 2013, 02:41:41 PM »
I'm still waiting to find out where I send my check. Every day that passes I'm missing out on 120/365% returns.

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Re: What about a Successful Business or Long Term Investment Scenario?
« Reply #26 on: June 26, 2013, 02:54:26 PM »
Yes it's hard to do and predict because you need investing skills and experience, but it does happen all around us every year.

No it doesn't. Just because a random stock doubles every year doesn't mean there exists an investor who bought and sold all of them at the exact right now. There isn't. No such investor exists, has ever existed, nor will ever exist. You can't get 120% returns.

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Re: What about a Successful Business or Long Term Investment Scenario?
« Reply #27 on: June 26, 2013, 02:55:42 PM »
If all it take is skills (are you sure you don't mean skillz? I think they're two different things) and experience then why aren't there more Buffets out there?

Even Buffett has only managed around 20% per year, and there is nobody more skilled and experienced than he. 120% is outlandish.

Undecided

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Re: What about a Successful Business or Long Term Investment Scenario?
« Reply #28 on: June 26, 2013, 03:06:57 PM »
Undecided, I apologize for glossing the context.  I believe you are right, though I have one caveat - I think you can "manage" the business, depending on what that entails.  I was coming from my frame of reference - for me, the only "business" I want in my retirement account is real estate, so I need to be concerned with properties I sell too quickly - since that is considered a business, even if no "sweat" was put into the equity. 

No, managing the business would be a prohibited transaction; in the rental real estate context, I don't think you'll find many advisors who would be confident that selecting tenants was OK, let alone doing maintenance. Generally people are comfortable with owning a rental inside an IRA and using a third-party real estate management company to operate and maintain it. Obviously everyone's free to decide how to conduct their own affairs, but what you're describing strikes me as a risky proposition.

Khan

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Re: What about a Successful Business or Long Term Investment Scenario?
« Reply #29 on: June 26, 2013, 06:11:02 PM »
If all it take is skills (are you sure you don't mean skillz? I think they're two different things) and experience then why aren't there more Buffets out there?

Even Buffett has only managed around 20% per year, and there is nobody more skilled and experienced than he. 120% is outlandish.

That, and Buffet managed to do that 20% by having a rigged system. By having the insurance business financing his investments with cheap money, he was able to gain exceptional leverage AND he used it extremely effectively.

Quote
"Buy very low on way undervalued, overly hyped companies; sell very high on way overvalued, overly hyped companies" ~Warren Buffet.
Free Your Chains, nice made up Warren Buffet quote. Now please never do that again.

Freeyourchains2

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Re: What about a Successful Business or Long Term Investment Scenario?
« Reply #30 on: June 27, 2013, 11:15:51 AM »
3 words, "Buy My Book!" my ebook is only going for $39.99!
Lol, just kidding. I hate all the advertising for fake "How to get rich guides" out there.

Most of us are Mustachians and Investors here right, so let me pose a question to take us to the next hierarchical level of possibilities...Gasp!

Once you have reached Financial Independence, would you take greater risks with extra cash to start a  business, or invest in a company that you believe will double your investment that year?

Kind of like turning those people going from $100k in debt whom live way above their means and don't care do do anything about it.... INTO Investors money machines who have changed their lifestyles to maximize efficiency, creativity,  and wealth.
The skill with MMM is found by increasing their savings rate, after reading MMM's blog and choosing to do so, and then doing it and getting out of debt; they are now thirsty to reach Financial independence for themselves, their entire family, and future family members, by developing the skill to increase their return rates.

But then what can be accomplished?
Technological revolution for mankind, Consumer to Investor revolutions, global peace, space conquest, even entire new countries to build, etc. The possibilities become limitless!

Saying you can't double your investment per year, is like saying no one in the history of man has ever increased their income to above $1 Million per year.

"It simply can't be done!"~ anti-mustachians

Rolls eyes. Not only can it be done but you can automate the process, and pay others to work the machines for you, and give them a cut or profit share if you feel generous.

You can double an investment by having the skills of motivation, creation, production, hard work, keeping your emotions at bay and leading with logic.

Here's a general how to guide to get you thinking on how you can do it also:

Since this excess cash after financial independence came from fun things you did anyways, You now have complete freedom to take any risk you desire, because you don't need this cash!

Option 1) Burn it, literally. Celebrate Like the fourth of July! Hey our government does it with our tax money so why not? (since every firework fired cost hard working taxpayers $1k-$10k each, and then they add a new tax to say those that drive electric cars next year)

Option 2) You know money = time and time = money, but once FI, You have your complete time back. More money doesn't equal more time, it just equals even more money.

As such you think about this critically. Money makes money, like investing money to buy shares,  and  taking a risk to sell for much higher, thus you can get a gain or profit when sold at a higher amount then you bought it for. With enough research, experience, and skill upon picking successful growth businesses that have potential to double their stock price in a year, one can then compound those capital gains, to earn even more money.

Compounded Interest and choosing to create/ do something/ research and pick/ develop skillz effectively increases my return rates over all to awesome levels!

And we aren't playing roulette here in betting 10 consecutive times on black or red, hoping we double our investment each time for ten times, that is just silly now isn't it?

Does anyone know the odds on that strategy? It can't be done right? It hasn't been done in the history of man right?

Real-life roulette exploits found here: http://en.wikipedia.org/wiki/Roulette

For example: In 1873, Briton Joseph Jaggers made the first famous biased roulette wheel exploit. Mr. Jaggers, with a team of six accomplices, carefully observed all the wheels at the Monte Carlo casino and found one wheel with significant bias. By taking advantage of this flaw they managed to win over $325,000, an astronomical sum in 1873.

But those are just "strategized exploits" that are done once, and the casinos principals of awareness are changed to prevent that from happening again.

Here is an example of real extraordinary creation:

In the 1890's, a 22 year old electrical engineering genius discovered a way to alternate the flow of electrical current effectively allowing electricity to travel over very long distances.

http://books.google.com/books?id=HIuK7iLO9zgC&printsec=frontcover#v=onepage&q&f=false

Nichola Tesla made 306 more inventions and patents, each earning well over $10 Million in yearly income each to this day! Effectively making a $900 Billion dollar industry in the USA alone in the current present!
http://www.eia.gov/electricity/sales_revenue_price/pdf/table10.pdf

Ideas and taking a risk on the ideas whether with a billion dollars or 10 cents! That is how you truly double your investment return every year!



« Last Edit: June 27, 2013, 11:19:47 AM by Freeyourchains2 »

arebelspy

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Re: What about a Successful Business or Long Term Investment Scenario?
« Reply #31 on: June 27, 2013, 11:24:35 AM »
Once you have reached Financial Independence, would you take greater risks with extra cash to start a  business, or invest in a company that you believe will double your investment that year?

No.  I'm a fan of the concept of enough.

As for your final statements, you seem not to understand the difference between a business and an investment.
We are two former teachers who accumulated a bunch of real estate, retired at 29, spent some time traveling the world full time and are now settled with three kids.
If you want to know more about us, or how we did that, or see lots of pictures, this Business Insider profile tells our story pretty well.
We (rarely) blog at AdventuringAlong.com. Check out our Now page to see what we're up to currently.

matchewed

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Re: What about a Successful Business or Long Term Investment Scenario?
« Reply #32 on: June 27, 2013, 11:30:26 AM »
Once you hit FI that "excess cash" is not actually excess. That is tomorrow's lunch, that vacation in 10 years, next months rent/mortgage payment, my next rental house, and the money for the rest of my life. Some of it can also be for projects or businesses that you may choose to start but money to live comes first.

Instead of the "motivational" speech on finding exploits can you provide me with data showing that it is "easy" to double your money annually? For every person who takes that risk that you think is just easy to see and just needs a bit of elbow grease there are dozens if not hundreds that fail.

And please don't take this as a personal attack but your posts are becoming more fragmented and are starting to look like the product of a fever dream. They're getting rather difficult to follow and I'm unsure if I'm even getting your point anymore.

Freeyourchains2

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Re: What about a Successful Business or Long Term Investment Scenario?
« Reply #33 on: June 27, 2013, 11:59:19 AM »
As for the rest of this thread, can we all just agree that Freeyourchains2 is absolutely right, that we are wasting our time and showing our ignorance by responding with differing opinions, and congratulate him now for his future unceasing successes in picking the best performing stocks each year.

Who am I to argue with a billionaire?

I will ask one question though.

FreeYourChains: Those were all examples of companies that returned 100%+ over the past year.  That doesn't really help me, as my time machine is not yet perfected.  Can you please give me 3 or 4 examples of ones that will return over 100% in the next (upcoming) year?  Thanks!

:-) I think it's time for Investor Alley to play one of those virtual stock picking games with interested members from one of those "virtual stock market picks" websites. And it should be handled by the Global Moderator who can also participate, so he can set the rules.

As for those that still don't believe investments can double in a year,

Just know the universe is expanding at 86x the speed of light all around you and with you in it, even though you aren't aware of it's expansion.

Once you hit FI that "excess cash" is not actually excess. That is tomorrow's lunch, that vacation in 10 years, next months rent/mortgage payment, my next rental house, and the money for the rest of my life. Some of it can also be for projects or businesses that you may choose to start but money to live comes first.

To clarify "excess cash":
With financial independence, your investment portfolio @ roughly 4% returns covers your all your needed expenses.
Say $500k @ 4% growing dividend returns, yields you $20,000/year and growing to cover your expenses that are at $17,500 each year.

Then you monetize whatever you feel like doing that day that you would freely do anyway because you are retired, and make $1-infinite "excess cash" that you didn't need because your expenses are all ready covered by your $500k investment.

This "excess cash" re-invested will yield growing compounded interest if you didn't spend it or burn it literally. As investors we know this.

You could start up a business with a bit of this excess cash you made. Then whatever the profits are that come in you could theoritically -re-invest it into the business, because you don't need the cash to live freely.

Kind of what MMM is doing with the MMM website's profits. Pooling it together after website expenses, re-investing earnings with profits as it grows in earnings, to either use later on or to spread the fruits (investment returns + profits) of the tree (website) around to make many many more trees (websites/ventures/investments/businesses).


matchewed

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Re: What about a Successful Business or Long Term Investment Scenario?
« Reply #34 on: June 27, 2013, 12:05:55 PM »
Nothing is stopping you from making the call. Tell us which stocks will double in the next year. Please I'm all ears.

What does the expansion of the universe have to do with investments doubling?

I'm not against people building businesses, it's your cash go ahead. But if you're just doing it for the sake of money then you're missing the point of FIRE to begin with.

arebelspy

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Re: What about a Successful Business or Long Term Investment Scenario?
« Reply #35 on: June 27, 2013, 12:26:29 PM »
Still waiting. :)

Quote
FreeYourChains: Those were all examples of companies that returned 100%+ over the past year.  That doesn't really help me, as my time machine is not yet perfected.  Can you please give me 3 or 4 examples of ones that will return over 100% in the next (upcoming) year?  Thanks!
We are two former teachers who accumulated a bunch of real estate, retired at 29, spent some time traveling the world full time and are now settled with three kids.
If you want to know more about us, or how we did that, or see lots of pictures, this Business Insider profile tells our story pretty well.
We (rarely) blog at AdventuringAlong.com. Check out our Now page to see what we're up to currently.

brewer12345

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Re: What about a Successful Business or Long Term Investment Scenario?
« Reply #36 on: June 27, 2013, 12:42:44 PM »
As for the rest of this thread, can we all just agree that Freeyourchains2 is absolutely right, that we are wasting our time and showing our ignorance by responding with differing opinions, and congratulate him now for his future unceasing successes in picking the best performing stocks each year.

Who am I to argue with a billionaire?

I will ask one question though.

FreeYourChains: Those were all examples of companies that returned 100%+ over the past year.  That doesn't really help me, as my time machine is not yet perfected.  Can you please give me 3 or 4 examples of ones that will return over 100% in the next (upcoming) year?  Thanks!

:-) I think it's time for Investor Alley to play one of those virtual stock picking games with interested members from one of those "virtual stock market picks" websites. And it should be handled by the Global Moderator who can also participate, so he can set the rules.

As for those that still don't believe investments can double in a year,

Just know the universe is expanding at 86x the speed of light all around you and with you in it, even though you aren't aware of it's expansion.

Once you hit FI that "excess cash" is not actually excess. That is tomorrow's lunch, that vacation in 10 years, next months rent/mortgage payment, my next rental house, and the money for the rest of my life. Some of it can also be for projects or businesses that you may choose to start but money to live comes first.

To clarify "excess cash":
With financial independence, your investment portfolio @ roughly 4% returns covers your all your needed expenses.
Say $500k @ 4% growing dividend returns, yields you $20,000/year and growing to cover your expenses that are at $17,500 each year.

Then you monetize whatever you feel like doing that day that you would freely do anyway because you are retired, and make $1-infinite "excess cash" that you didn't need because your expenses are all ready covered by your $500k investment.

This "excess cash" re-invested will yield growing compounded interest if you didn't spend it or burn it literally. As investors we know this.

You could start up a business with a bit of this excess cash you made. Then whatever the profits are that come in you could theoritically -re-invest it into the business, because you don't need the cash to live freely.

Kind of what MMM is doing with the MMM website's profits. Pooling it together after website expenses, re-investing earnings with profits as it grows in earnings, to either use later on or to spread the fruits (investment returns + profits) of the tree (website) around to make many many more trees (websites/ventures/investments/businesses).

Alternating hits off a crack pipe and your brother's dick is not helping your coherence, dude...

Freeyourchains2

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Re: What about a Successful Business or Long Term Investment Scenario?
« Reply #37 on: June 27, 2013, 01:04:49 PM »
Alternating hits off a crack pipe and your brother's dick is not helping your coherence, dude...

If you want coherence or clarity you can buy the edited, published book version at a later date.

Obama was on crack when he wrote his books while in college, which later were edited and then made him millions after he became president.

http://www.nytimes.com/2006/10/24/world/americas/24iht-dems.3272493.html?_r=0


arebelspy

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Re: What about a Successful Business or Long Term Investment Scenario?
« Reply #38 on: June 27, 2013, 01:44:32 PM »
If you want coherence or clarity you can buy the edited, published book version at a later date.

Maybe we can make it the Mustachian Book Club of the month book.
We are two former teachers who accumulated a bunch of real estate, retired at 29, spent some time traveling the world full time and are now settled with three kids.
If you want to know more about us, or how we did that, or see lots of pictures, this Business Insider profile tells our story pretty well.
We (rarely) blog at AdventuringAlong.com. Check out our Now page to see what we're up to currently.

matchewed

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DoubleDown

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Re: What about a Successful Business or Long Term Investment Scenario?
« Reply #40 on: June 27, 2013, 03:22:50 PM »
https://en.wikipedia.org/wiki/Bipolar_disorder

"At the lower levels of mania known as hypomania, individuals appear energetic and excitable and may in fact be highly productive. At a higher level, individuals begin to behave erratically and impulsively, often making poor decisions due to unrealistic ideas about the future

...

Mania is the defining feature of bipolar disorder. Mania is a distinct period of elevated or irritable mood, which can take the form of euphoria, and lasts for at least a week (less if hospitalization is required).[3] People with mania commonly experience an increase in energy and a decreased need for sleep, with many often getting as little as three or four hours of sleep per night. Some can go days without sleeping.[4] A manic person may exhibit pressured speech, with thoughts experienced as racing.[5] Attention span is low, and a person in a manic state may be easily distracted. Judgment may be impaired, and sufferers may go on spending sprees or engage in risky behavior that is not normal for them. They may indulge in substance abuse, particularly alcohol or other depressants, cocaine or other stimulants, or sleeping pills. Their behavior may become aggressive, intolerant, or intrusive. They may feel out of control or unstoppable, or as if they have been "chosen" and are "on a special mission", or have other grandiose or delusional ideas."

brewer12345

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Re: What about a Successful Business or Long Term Investment Scenario?
« Reply #41 on: June 27, 2013, 04:46:44 PM »
Alternating hits off a crack pipe and your brother's dick is not helping your coherence, dude...

If you want coherence or clarity you can buy the edited, published book version at a later date.

Obama was on crack when he wrote his books while in college, which later were edited and then made him millions after he became president.

http://www.nytimes.com/2006/10/24/world/americas/24iht-dems.3272493.html?_r=0

I buy my toilet paper at Costco, thanks anyway.

footenote

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Re: What about a Successful Business or Long Term Investment Scenario?
« Reply #42 on: June 27, 2013, 05:27:04 PM »
Oh, dear. Late to this "party," but I feel compelled to add...

I achieved FI at 47. I dreamed up and funded two startups. It was an outstanding experience (first one failed, second one is modestly successful*).

I hate to break this to you, Freeyourchains2, but it's also... work. Lots of work. Really, really difficult, wee-hours-sleepless, "What the heck was I thinking?!" work.

*"Modestly successful" = Two years of labor (no salary) + lotsa $$$ invested. Currently harvesting a modest $2k per month. Happy to be providing a valued SaaS and able to recoup at least a little of my investment.

P.S. The IRA investment thing is, as others have observed, a very dicey proposition. I used post-tax money to fund my startups. Or, in other words: There Is No Free Lunch.

matchewed

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Re: What about a Successful Business or Long Term Investment Scenario?
« Reply #43 on: June 27, 2013, 06:51:24 PM »
Oh, dear. Late to this "party," but I feel compelled to add...

I achieved FI at 47. I dreamed up and funded two startups. It was an outstanding experience (first one failed, second one is modestly successful*).

I hate to break this to you, Freeyourchains2, but it's also... work. Lots of work. Really, really difficult, wee-hours-sleepless, "What the heck was I thinking?!" work.

*"Modestly successful" = Two years of labor (no salary) + lotsa $$$ invested. Currently harvesting a modest $2k per month. Happy to be providing a valued SaaS and able to recoup at least a little of my investment.

P.S. The IRA investment thing is, as others have observed, a very dicey proposition. I used post-tax money to fund my startups. Or, in other words: There Is No Free Lunch.

Wait no free lunch? Screw. That. Noise. I'm out.






j/k but can I at least have some bread?

Freeyourchains2

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Re: What about a Successful Business or Long Term Investment Scenario?
« Reply #44 on: June 28, 2013, 09:09:44 AM »
Let's talk a more active approach to doubling your investment per year.

Let's take this to a microscopic level strategy, from the 120% return per year macroscopic level long term-ish strategy for a moment.

10% returns per month = 120% returns per year.

Say there are 22 trading days available per month in the NYSE.

To achieve 10% returns per month, you could look for one stock that you believe will gain 10% that month, and buy it low and undervalued and then sell it at 10% higher  then what you bought, in 2-5 days, or in 1-20 trading days, aka once per month, depending on when it reaches the speculated target goal and meets your goal of 10% gains in that month. (minus $14 in commissions for one trade that month.)

Or you can find a day trading brokerage firm and get 50 trades for $$/month.

And have a goal to make 0.5% gains per trading day. or 1% gains in the span of every two trading days.

Your month's overall game plan flexes based on your gains per day or week.

If you make 10% in the first week or in first day, you can be done for that month, unless you see a lot more opportunities.

But this all dives into active investing on a day to day "watch the market" type activity/hobby/fun for a few.

You can always think long term investment and go for that double of your investment over one year, then many years.

Or you can go for the short term investments and go for that double of your investment over one year, then many years.

Two very different approaches but both have similar fundamentals to investing to follow.

Both take risk, as do all investments.

It's easier to take more risk when you are already FI and have excess cash you obtained for fun to do what you want with, whether charity, bought something like fireworks, burned it literally, or invested it to have it making more money for you but not to live off of. Just solely for the purpose of growth and over abundance in savings/wealth.

matchewed

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Re: What about a Successful Business or Long Term Investment Scenario?
« Reply #45 on: June 28, 2013, 09:26:21 AM »
List me the stocks that will rise 10% in the next month.

List me the stocks that will raise .5% tomorrow, or 1% two days from now.

I'm not trying to dissuade anyone from trading. Go ahead and trade. But know that it is statistically equivalent to flipping a coin on a day to day basis (if you land on heads 52% of the time). What makes this different from playing black jack at the casino?

brewer12345

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Re: What about a Successful Business or Long Term Investment Scenario?
« Reply #46 on: June 28, 2013, 09:40:13 AM »
Let's talk a more active approach to doubling your investment per year.

Let's take this to a microscopic level strategy, from the 120% return per year macroscopic level long term-ish strategy for a moment.

10% returns per month = 120% returns per year.

Say there are 22 trading days available per month in the NYSE.

To achieve 10% returns per month, you could look for one stock that you believe will gain 10% that month, and buy it low and undervalued and then sell it at 10% higher  then what you bought, in 2-5 days, or in 1-20 trading days, aka once per month, depending on when it reaches the speculated target goal and meets your goal of 10% gains in that month. (minus $14 in commissions for one trade that month.)

Or you can find a day trading brokerage firm and get 50 trades for $$/month.

And have a goal to make 0.5% gains per trading day. or 1% gains in the span of every two trading days.

Your month's overall game plan flexes based on your gains per day or week.

If you make 10% in the first week or in first day, you can be done for that month, unless you see a lot more opportunities.

But this all dives into active investing on a day to day "watch the market" type activity/hobby/fun for a few.

You can always think long term investment and go for that double of your investment over one year, then many years.

Or you can go for the short term investments and go for that double of your investment over one year, then many years.

Two very different approaches but both have similar fundamentals to investing to follow.

Both take risk, as do all investments.

It's easier to take more risk when you are already FI and have excess cash you obtained for fun to do what you want with, whether charity, bought something like fireworks, burned it literally, or invested it to have it making more money for you but not to live off of. Just solely for the purpose of growth and over abundance in savings/wealth.

"Now, you talk about that Bohagus boy. You know him, Billy Bohagus? They
 found him last week out behind the barn [dramatic pause] with his math
 teacher, his Scout leader, and the local minister, and that boy had the
 nerve to say it was part of a biology project. We killed him; had no
 other choice."
 

arebelspy

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Re: What about a Successful Business or Long Term Investment Scenario?
« Reply #47 on: June 28, 2013, 09:56:07 AM »
Let's talk a more active approach to doubling your investment per year.

Let's take this to a microscopic level strategy, from the 120% return per year macroscopic level long term-ish strategy for a moment.

10% returns per month = 120% returns per year.

You do realize anyone that could successfully do this would be one of the richest people in the world, and that if it was possible... people would be doing it?

People try it, but it's not possible, and they lose lots of money.

Best of luck to you.
We are two former teachers who accumulated a bunch of real estate, retired at 29, spent some time traveling the world full time and are now settled with three kids.
If you want to know more about us, or how we did that, or see lots of pictures, this Business Insider profile tells our story pretty well.
We (rarely) blog at AdventuringAlong.com. Check out our Now page to see what we're up to currently.

DoubleDown

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Re: What about a Successful Business or Long Term Investment Scenario?
« Reply #48 on: June 28, 2013, 11:03:41 AM »
Bipolar Disorder treatment options:

http://www.webmd.com/bipolar-disorder/default.htm

Freeyourchains2

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Re: What about a Successful Business or Long Term Investment Scenario?
« Reply #49 on: June 28, 2013, 11:40:13 AM »
Let's talk a more active approach to doubling your investment per year.

Let's take this to a microscopic level strategy, from the 120% return per year macroscopic level long term-ish strategy for a moment.

10% returns per month = 120% returns per year.

You do realize anyone that could successfully do this would be one of the richest people in the world, and that if it was possible... people would be doing it?

People try it, but it's not possible, and they lose lots of money.

Best of luck to you.

People also tried splitting the atom, were successful, and now we have hundreds of thousands of nuclear war heads.

People also tried looking at star's wobbles with telescopes, and now we have been discovering thousands of Earth like planets in habitable zones of other star's.

People also tried to compete with the auto industry in making electric vehicles (Tesla Motors) and now we have luxury electric cars with charge stations appearing across the nation. Soon to be more affordable to the average consumer.

The list goes on, don't let fear stop you. Be creative. If you can't find your dream investments, make them.