Best Interest rates or Investment ROI?

[COZICAN]

I too will stick with the stock market. Between my 401K, 2 IRA's and some taxable investments; maxing all of those and even playing the 50+ catch-up now my portfollio looks pretty nice since beginning in 1991. Yes, there's been a little red ink at times but I'll take it over real estate any day.

 

[OKCShooter]

Are you a lawyer or doctor or something? I like that everybody can find their own success. My wife and I are different than most but what works for us may not work for others. We put into 401, my ranch, and cattle and pay debt down like her big college loans. It may not be numerically the best but it keeps us motivated and our eyes on our target goals. Goals is the best advice I can give. Not percentages.

I graduated with a couple degrees from OU in 1994, since then I have spent a majority of my career in the Biomedical profession specializing in Oncology. I'm no financial expert, just a guy that has learned a long the way. My Father was the President of a Bank and I learned from him before that. I never received a penny from Family so I am self-made. I have made plenty of mistakes and when possible let people know what I have learned to help them avoid the same!

I lived below my means my whole life and outside of borrowing for a home I have never had a loan. I have been completely debt free (including my home) for 10 years due to my financial decisions, that's why I express them here when I see someone making (what I believe) silly statements that others may read as truths. There are MANY people on this forum more "successful" than I, but they aren't the same people posting bad advice.

I think there are many ways to invest and I chose what was right for me, and it sounds like you have as well. The first thing I tell people that ask my advice is to first, understand what they are investing in and know their goals and second, to listen to people that have succeeded. I don't take nutritional advice from fat people.

Anyway, when Clay says something about 'throwing darts to pick single stocks to outperform real estate investments over a 30 year span' I can't hold back because that's insane.

I agree with what you wrote except for the highlighted part, what good is a goal if it isn't successful? "Percentages" which is the RoR is everything when investing. I'd hate for someone to follow that advice and after 10 years realized they reached a "Goal" only to find out that they made no return....returns are the point of investing.


Good luck with your portfolio, my Paternal grandparents are cattle ranchers and land owners and have done well over the years!

 

[tranger2]

I researched a true life example...

If you paid $103k in 2009 and the county has today's value at $117k.
If the house rents for $1k/month, then $12k annual. Property taxes on that property is $1300 year, Insurance = ? (I will assume $1000 year, no clue).

Assumptions:
Paid cash for the house, no mortgage interest incurred.
The house never sits empty.
No repairs

Then:
You have an unrealized gain of $14K over 5 years. (2.8% avg growth per year)
You have an annual realized gain of $9,700 ($12k rent - $2300 ins and taxes) for 9.7% annual return.

Pros:
Did not account for depreciation.
Can write off business expense for tools, mileage, etc.

Cons:
Major expense could hit = HVAC goes out, pipes burst, etc
Could get a renter from hell or house sits empty for a while.


What have I missed?

 

[BobBarker]

The depreciation will shelter a lot of the income from taxes

 

[SlugSlinger]

The S&P has increased 29.51% over the last 18 months from close on June 28, 2013 to yesterday's close.

2013 was a stellar year for the market. My market investments increased 34%. This year I'm looking at around a 10% market investment increase.

Over the life of the market, the return has averaged 12%. In my financial retirement modeling, I use a very conservative 6% market return. I have averaged well above that, but want to plot the worse case scenario for my analysis and trending.

 

[technetium-99m]

I've never had a property sit empty for more than a month, and that was because there was a bad run of undesirables applying to rent. If you price it right you will always have tenets. You also need to be choosy in what homes you buy, deals on ready to go homes are out there you just have to look. Also make good friends with a quality inspector, they can be worth their weight in gold.

 

[SPDguns]

Hopefully you're joking.

ME????? Never!!!!!

 

[tntrex]

I graduated with a couple degrees from OU in 1994, since then I have spent a majority of my career in the Biomedical profession specializing in Oncology. I'm no financial expert, just a guy that has learned a long the way. My Father was the President of a Bank and I learned from him before that. I never received a penny from Family so I am self-made. I have made plenty of mistakes and when possible let people know what I have learned to help them avoid the same!

I lived below my means my whole life and outside of borrowing for a home I have never had a loan. I have been completely debt free (including my home) for 10 years due to my financial decisions, that's why I express them here when I see someone making (what I believe) silly statements that others may read as truths. There are MANY people on this forum more "successful" than I, but they aren't the same people posting bad advice.

I think there are many ways to invest and I chose what was right for me, and it sounds like you have as well. The first thing I tell people that ask my advice is to first, understand what they are investing in and know their goals and second, to listen to people that have succeeded. I don't take nutritional advice from fat people.

Anyway, when Clay says something about 'throwing darts to pick single stocks to outperform real estate investments over a 30 year span' I can't hold back because that's insane.

I agree with what you wrote except for the highlighted part, what good is a goal if it isn't successful? "Percentages" which is the RoR is everything when investing. I'd hate for someone to follow that advice and after 10 years realized they reached a "Goal" only to find out that they made no return....returns are the point of investing.


Good luck with your portfolio, my Paternal grandparents are cattle ranchers and land owners and have done well over the years!

I assume you are in sales and not an oncologist or you would have told me. Thanks for your story I do like hearing peoples paths in life. Especially successful ones. We are youngish and ambitious so we always listen to ideas others have. If you ever service jcmh hit me up I'll take you to dinner.

 

[SlugSlinger]

Return is relative to risk. A high return is positively correlated with high risk. So if you can accept high risk, you should expect a higher return. If you are risk adverse, your return will be lower.

You can't compare returns on different investments without including risk as a variable to see the big picture.

 

[FullAuto]

I researched a true life example...

If you paid $103k in 2009 and the county has today's value at $117k.
If the house rents for $1k/month, then $12k annual. Property taxes on that property is $1300 year, Insurance = ? (I will assume $1000 year, no clue).

To me, this is a problem. This example should have never been purchased to make a rental IMO. If I have $100k in property, it better be paying more than $1k per month. And I shouldn't have $103k invested in a house worth $117k 5 years later.