I totally agree with your approach. It is my belief that if you don't earn it you don't appreciate it. There have been many documented cases of kids doing well in college that their parents paid for but the avg dropout rate is 41% and i would suspect that most of these "kids" don't have any skin in the game. My parents were not able to send us 7 kids to college, but 4 of us went. Interesting to note the 3 who didn't go were/are as successful as those who did. It took me many years in night school to finally get my associates in business but I got a promotion and didn't go any further. I helped my oldest some but he worked every other semester to also help pay his way and is a VP now in a large comercial contracting firm. I was able to pay for my youngest to go to college and he failed out twice, some $60k or so down the drain. He is doing ok working in maintenance at an airport in Denver now but not a lot of prospects to move up. I am contributing to our two grandsons 529 plans but there is not enough there to put them through school. My son who mostly paid his way will have this decision to make. It is my opinion that hard knocks build character and handouts help create laziness. Not exclusive but a large percentage, see dropout rate. I also don't think that calling children kids is derogatory in any way shape or form.
My advisor does not like bond funds or ETF funds as regardless of the yield the value goes up and down with the market, albiet a little less than stocks. He has guided me into municipal bonds mostly and one Ford corporate bond. These have varying maturity, Ford call date is 2031, paying 8.9%, most of the municipal funds are in the 4-5% range. If you buy these in the state you live there is no state income tax which adds a little to your yield. These have worked well for me adding to my dividend income which i live off of and a few have matured to give us a nice cash nest egg to cover the ups and downs of the market. Recently MM fund yields at 4.5% and greater have led me to keep my cash and not buy the funds, bought CJLXX yesterday yielding 4.6% with a .18 fee. Finally seeing some movement on MM, I hate that it took high inflation to get it there though.
Good article and it is a tough decision, and I do think we are more active than our parents were at this age (69). I played 3 hrs of pickleball this morning and do several times a week, my father would not have thought about what excercise might do to improve the mind and body. Unfortunately in my opinion, gerontocracy is running this company and it's not going to change. We have a president who is 80 and will run again. He will run againsts an opponent who is 76 and we have congressional members who are routinely in their 80's and 90's. We should make room for the younger generation especially in the leadership of our country. Can we say term limits?
Grew up in a large family, one of 7 and knew that I had to make it on my own. I have had a pretty much full time job since I was 16. Bought my first car, making payments to my father. Got married much too early and had a son at 20. Divorced after 6 years. Went to a local tech school for a couple of years in electronics but never put that to use. Working for Celenese Fiber at the time was promoted to supervisor and dropped out of school. Saw an opportunity in Atlanta a few years later and moved there at 26. Started North GA college at night and worked my way up to plant manager and eventally VP Mfg. Retired 4 years ago with a heathy portfolio, no pension but no real worries about income either. Never finished that degree although I checked on it recently and can go back to a Georgia institution for free and I have enough credits for an associates. We all are not meant for college.
Great article and one more reason to hold these dividend stocks is their stability. I hold about the same amount of individual stocks as well and they are the "aristocrats" also. They have been much less volitile than the indexes and help me SWAN. Some of you may have read Ryan Krueger, he is another proponent of dividend stocks and if you are retired and can get your portfolio yield >4% then the 4% rule works - mine is very close now and I constantly try to improve. Read this great article from Ryan.
https://www.freedomdaysolutions.com/post/whoa-what-if-there-isn-t-a-safe-withdrawal-rate
It is not a guaranteed loser as I have been investing in individual stocks for 30 years now and have a pretty good track record with about 60 or so stocks and as Joe said they are companies who increase their dividends every year and have done for a decade or more. Another reason to hold blue chip dividend stocks (not high yield as has been commented on here) is they are much more stable and do not decline as much as the indexes do. I can control what I own, I have no control over the S&P or any other mutual fund or index and I can control what I sell. Mutual funds are notorious in giving you a bunch of capital gains in Oct of each year as they try to hold on to their performance and bonuses. Ryan Krueger writes a good blog about this as well. If you are retired or close to it, it would be a good article to hold on to. I assume you have heard of the 4% rule. https://www.freedomdaysolutions.com/post/whoa-what-if-there-isn-t-a-safe-withdrawal-rate
Comments:
I totally agree with your approach. It is my belief that if you don't earn it you don't appreciate it. There have been many documented cases of kids doing well in college that their parents paid for but the avg dropout rate is 41% and i would suspect that most of these "kids" don't have any skin in the game. My parents were not able to send us 7 kids to college, but 4 of us went. Interesting to note the 3 who didn't go were/are as successful as those who did. It took me many years in night school to finally get my associates in business but I got a promotion and didn't go any further. I helped my oldest some but he worked every other semester to also help pay his way and is a VP now in a large comercial contracting firm. I was able to pay for my youngest to go to college and he failed out twice, some $60k or so down the drain. He is doing ok working in maintenance at an airport in Denver now but not a lot of prospects to move up. I am contributing to our two grandsons 529 plans but there is not enough there to put them through school. My son who mostly paid his way will have this decision to make. It is my opinion that hard knocks build character and handouts help create laziness. Not exclusive but a large percentage, see dropout rate. I also don't think that calling children kids is derogatory in any way shape or form.
Post: Making Their Own Way
Link to comment from June 21, 2023
My advisor does not like bond funds or ETF funds as regardless of the yield the value goes up and down with the market, albiet a little less than stocks. He has guided me into municipal bonds mostly and one Ford corporate bond. These have varying maturity, Ford call date is 2031, paying 8.9%, most of the municipal funds are in the 4-5% range. If you buy these in the state you live there is no state income tax which adds a little to your yield. These have worked well for me adding to my dividend income which i live off of and a few have matured to give us a nice cash nest egg to cover the ups and downs of the market. Recently MM fund yields at 4.5% and greater have led me to keep my cash and not buy the funds, bought CJLXX yesterday yielding 4.6% with a .18 fee. Finally seeing some movement on MM, I hate that it took high inflation to get it there though.
Post: Not Bonding
Link to comment from February 28, 2023
Good article and it is a tough decision, and I do think we are more active than our parents were at this age (69). I played 3 hrs of pickleball this morning and do several times a week, my father would not have thought about what excercise might do to improve the mind and body. Unfortunately in my opinion, gerontocracy is running this company and it's not going to change. We have a president who is 80 and will run again. He will run againsts an opponent who is 76 and we have congressional members who are routinely in their 80's and 90's. We should make room for the younger generation especially in the leadership of our country. Can we say term limits?
Post: When to Quit
Link to comment from February 15, 2023
Grew up in a large family, one of 7 and knew that I had to make it on my own. I have had a pretty much full time job since I was 16. Bought my first car, making payments to my father. Got married much too early and had a son at 20. Divorced after 6 years. Went to a local tech school for a couple of years in electronics but never put that to use. Working for Celenese Fiber at the time was promoted to supervisor and dropped out of school. Saw an opportunity in Atlanta a few years later and moved there at 26. Started North GA college at night and worked my way up to plant manager and eventally VP Mfg. Retired 4 years ago with a heathy portfolio, no pension but no real worries about income either. Never finished that degree although I checked on it recently and can go back to a Georgia institution for free and I have enough credits for an associates. We all are not meant for college.
Post: Do parents have an obligation to pay part or all of their children’s college costs?
Link to comment from December 24, 2022
Great article and one more reason to hold these dividend stocks is their stability. I hold about the same amount of individual stocks as well and they are the "aristocrats" also. They have been much less volitile than the indexes and help me SWAN. Some of you may have read Ryan Krueger, he is another proponent of dividend stocks and if you are retired and can get your portfolio yield >4% then the 4% rule works - mine is very close now and I constantly try to improve. Read this great article from Ryan. https://www.freedomdaysolutions.com/post/whoa-what-if-there-isn-t-a-safe-withdrawal-rate
Post: Watching Them Grow
Link to comment from December 10, 2022
It is not a guaranteed loser as I have been investing in individual stocks for 30 years now and have a pretty good track record with about 60 or so stocks and as Joe said they are companies who increase their dividends every year and have done for a decade or more. Another reason to hold blue chip dividend stocks (not high yield as has been commented on here) is they are much more stable and do not decline as much as the indexes do. I can control what I own, I have no control over the S&P or any other mutual fund or index and I can control what I sell. Mutual funds are notorious in giving you a bunch of capital gains in Oct of each year as they try to hold on to their performance and bonuses. Ryan Krueger writes a good blog about this as well. If you are retired or close to it, it would be a good article to hold on to. I assume you have heard of the 4% rule. https://www.freedomdaysolutions.com/post/whoa-what-if-there-isn-t-a-safe-withdrawal-rate
Post: Watching Them Grow
Link to comment from December 10, 2022