Posted on July 14, 2008 @ 11:05 pm - Written by BawldGuy
David Shafer, as I’ve said here often, is a very smart kinda guy. He’s written as a guest here before, and will again. His blog, Uncommon Financial Wisdom, is just that — uncommonly excellent. He’s a student of the what works, common sense, and Old School fundamentals. David’s the first planner type who understands the role of real estate and promotes it. I’m not sure, by I might be the only real estate investment guy who refers clients to him for non-real estate products required by Purposeful Plans I’ve created.
And for the record, when I refer my clients to David, no money comes my way. I do it, when I do it, ‘cuz it’s the right thing to do. Team is a fundamental concept at Brown and Brown, and we’re proud to be able to say David Shafer is on ours.
The Stressed (Disappearing) Middle Class
At first it was just a theory based on scant evidence. Then the evidence started piling up. Now it’s a full fledged sociological phenomenon. Yes, the middle class is slowly being eroded. That great middle, which developed two generations ago, the one that made our country unique, that allowed for the majority to feel secure, and to have opportunities in life that were previously unimagined, is slipping away. More and more our country’s economic demographics is looking like an hourglass.
What does that mean to an investor? First, let’s take a look at some interesting phenomenon. Take education. One generation ago people felt that with 12 years of schooling and hard work one could assure themselves a place in the middle class. And to accomplish this one only had to attend the free public school system. Most folks felt that the public school system was fine. Now, people think there are two years of pre-school, and four years of college which must be successfully attended in order to assure that middle class spot. And folks are worried about the public school system. So what that means is that instead of twelve years of free education getting one into the middle class, there are at least six years of paid education along with the 12 free. But even more than that, since people in general don’t trust the school systems there is competition to live in the best school districts. The data has shown that real estate in the best school districts has risen faster then the general area real estate. So folks who are trying to get their kids into the middle class have to bear the costs of more education as well as higher real estate cost. Read the rest of this entry »
Posted on July 9, 2008 @ 11:30 pm - Written by BawldGuy
Well, yes and no. If yer talkin’ fixers, and you have the experience and expertise, go for it. I’ll show you how to blend your efforts into a Plan designed with your talents in mind. If it’s not a fixer, but for any of the many possible reasons you’re able to buy way below market, and it’s not in a stoopid bad area, ditto.
As said here many times, buying/selling for quick profits isn’t in and of itself, bad. But it is imperative to understand the long term problems with buying/fixing/selling as a modus operandi. Well, there’s only one problem. Or, maybe it’s not a problem for you. Are you OK with workin’ on fixers ’till you croak? ‘Cuz that’s yer future if that’s all yer doin’.
Look, let’s use your fix up talents to your advantage. First, and most crucial, is to begin to think long term. That one fundamental change in thinking will have a turbo charging affect on your long term capital growth, and therefore your ultimate net worth. Oh, now I have your attention. Hey, whatever floats yer boat.
Here’s what you may wanna consider. Read the rest of this entry »
Posted on July 7, 2008 @ 11:59 pm - Written by BawldGuy
“The mass of men lead lives of quiet desperation.” Thoreau
Do you love what you do? Let’s be honest. Even for those who love the results of their labor, as do I, there are certain realities for which my anticipation isn’t amplified with a winning smile. Heck, even that was sugar coated. Let’s cut to the chase.
Part of life’s reality for million’s of Americans is what their retirement will look like — or more to the point, what it won’t look like. The older they are, the more likely desperation threatens to take hold.
I’m here to tell these folks there’s one immediate action they can take to begin to change their future positively.
They can stop pretending.
They pretend the qualified retirement plan at work is gonna be just fine. This, even though the average 50-something American male has less than $60,000 in their 401(k). If they’re 55, and retire at 65, (more pretending) what will that paltry sum have grown to? Let’s give them a huge benefit of the doubt and say they quadruple it in the decade before their retirement. The retiree having to retire based upon SS payments plus the income derived from less than $250,000 will have to turbo charge their talent for pretending.
Yer 30 or 40-something? Our clients average age range is 35-55. We have younger and older clients in decent numbers. You can correctly envy the younger, and say a prayer for the older. They have a steep hill to climb, and little time in which to plant their flag at the summit.
Back to pretending. Read the rest of this entry »
Posted on July 3, 2008 @ 11:51 pm - Written by BawldGuy
This is a real simple one people. Flippers with at least 2-3 years experience will see themselves here, and nod their heads. They know exactly what’s what when it comes to what they do and what their real estate investor buddies do.
Ya see, even if the flipper does well, he’s paying ordinary income tax rates on his profits. And if not? He’ll get caught soon enough. Seen it too many times. Most flippers though, earn their profits fairly, pay their taxes, then move on to the next one.
‘Course they gotta take out money for themselves before the movin’ on part actually, you know, moves on. After ’bout the third or fourth one, it becomes fairly clear exactly what’s what.
Here’s the dirty little secret flippers won’t bring up while chowin’ down on the BBQ this weekend.
They very rarely retire well at all. They hit 50 or so, then realize the sun is setting quickly their chances for a stellar retirement. It’s not a good feeling. I’ve consulted with several 50-something flippers in the last couple years. It ain’t been pretty.
They’ve discovered all flippin’s got ‘em is a bigger paycheck, higher taxes, harder work, and more liabilities. And they can’t stop, or it’s back to whatever job they hated before they started flippin’ real estate. They’ve built themselves a prison with no doors. Read the rest of this entry »
Posted on July 1, 2008 @ 9:07 pm - Written by BawldGuy
You and I are having a relaxed conversation. You’ve been thinkin’ of contacting me for quite awhile, and finally took the plunge. You’re now pondering the answer to my first question — What do you want your retirement to look like? As surprising as it may be, that question is a poser for lots of folks.
Try not to primarily think in terms of retirement income. Think lifestyle. How much of a traveler do ya wanna be? Wanna be a globe trotter, or are you more a see the grandkids type? What about how you’ll be traveling? Gonna be an ocean goer? Maybe you’ll be staying in the contiguous 48 and takin’ long trips in the cool RV — maybe a $400,000 RV? Hey, it’s your retirement, what do you want? You and I will make it happen. Our #1 weapons? Your vision and my Purposeful Plan.
See what I mean? It’s one thing to randomly think or even talk about your retirement, but try to answer the question concretely and it becomes a different tale altogether. Read the rest of this entry »