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Investment Options

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Fergienewbee

Well-known Member
I'll be getting a check from the sale of my dad's house in a couple of days. The bank is paying 1/2% on a two-year CD. Won't be doing that. We have some money in Franklin Templeton funds that appears to be returning about 3.5-4.0%--last year. That is a long term investment that we kind of just leave alone. What are some other investment options? I'm almost 67, my wife is 59 so she'll be working for a while yet. Land might be feasible with lots of study, but I'd like to keep my capital liquid. To keep on the subject, I could invest in a tractor, but that's not likely, except for a small utility model for working. We'll be paying off the house and a credit card so will pick up about $600 in interest. Thought about an outdoor furnace after last winter's propane bills. We'll talk to an investment counselor but wonder if anyone has any advice.

Larry
 
Fergie Shop around .. I am getting 3.5% on 4 year CD right now. I am not a big stockmarket player do have some in mutual funds. Land is a long term investment. Be careful what ever you do.
 
For liquidity and security, you'll get no earnings. For growth in money you'll need to take risk which means stocks/mutual funds. I would be very careful of annuities. You do need to know that you'll be tying money up for a yearly return. When you talk to a consultant, come back here and tell us what he said.
 
I just bought a 20 KW whole house back up generator and 2500 gallons of propane at $1.39/gal in order to get (my second) free 500 gal tank.

I'm also buying a new 1000' paved driveway with substantial bridge.

These days, I've been putting money in assets rather than liquid investments.

Dean
 
If you're planning to stay in the house a while, consider investing in it. Insulation, Windows, heat pump? If you don't like your heat bill you will probably get a decent return with energy savings. Think about how long you want to handle wood before you go that route.
 
Get the small utility tractor, can't go wrong there. Land is really high in my area, and in my opinion not a good investment right now. For sure not for a guy only looking at investment purposes. You need to buy at a low end market and you've already missed the boat on that for the time being for land in my area.
 
Look into a company called Douglas Dynamics they pay a dividend of about 5%. Well managed company
 
I have my money invested at Edward Jones. The agent's father was a very good friend of my father. So I can trust him, so far has not led me wrong. Will not cost you to talk to a good agent. Then you can decide what you need to do.

Joe
 
Like a couple of ideas already. We have a gravel drive, around 1,000 feet. Might look into paving. Would definitely up the resale. Our house is fairly new (2001) and well insulated--also have double pane windows. Could spend on yard and landscaping too. Have a few acres that could be cleared for crops. We're going to do a lot of homework and not be pressured into any quick decisions. I'm open to suggestions.

Larry
 
I'm your age , and I have invested in the Vanguard 500 Index fund. It's all stocks , and pays well....
 
A CD (Certificate of Deposit) is the same thing you get when you
deposit money in your savings account. It's a receipt.
Occasionally, CD accounts may pay more interest than a savings account.
They are probably the second worst "investment", next to old tractors.
If you want to actually make money from your bank, buy their stock.
Otherwise I would look at other investments as you are doing.
 
Ferg,
At your age, not much sense in investing in land and it surely will not be liquid (And you run a big risk of not seeing your land go up enough to cover the risks of it going down someday).
Buying any machine... tractor, car, truck is not "investing"....no matter how you rationalize that. Those are expenses, pure and simple. (Never heard of anyone getting rich buying and selling hunks of painted metal...except new car dealers.) Forget the toys until you have real excess cash laying around.
And you are paying $600 interest on a credit card?? Lordy....pay that sucker off and cut it up!
High heat bills? In a few years you will not feel like cutting wood anymore (I am 77 and sold the chain saw and splitter several years ago) so get improved insulation in that house real soon.
By all means, talk to 2 or 3 investment counselors and not just one.
LA in WI
 
I don't like to put all eggs in one basket.

For some investment, govt bonds can be nice.

Be picky, and the ones under general obligation are pretty well rated.

You can find them paying 4% from time to time. They pay all different rates, but you buy them for more or less than face value so it adjusts...

Anyhow, the good deal is you get the type that are tax free. So they don't count on your income taxes. That makes a 4% return look pretty good......

If you need the cash you can put them back on the market, and wait for someone to buy them. So they might be for 12 or 30 years or whatever, but you can cash them in if need be.

Just an option.

Paul
 
Real Estate Trusts or REIT's, There are good 1's and bad 1's you need to have a good advisor to pick them out. Right now we've got a good share of money in them and have for several years. They've been paying around 6% annually. You need to talk to your advisor about the liquidity. Some are very liquid others not so much.
 
You want a high rate of return, low risk and good liquidity. So does everyone else. That's why such investments don't exist and that's why con men like Bernie Madoff continue to suck in people who should know better.

"Franklin Templeton" doesn't tell me what KIND of investment fund you have. With a four percent return last year, it's probably heavily invested in intermediate-term bonds. The problem with bonds is they are very sensitive to interest rate fluctuations. A rise in short-term interest rates causes the value of long and medium-term bonds to drop. Since interest rates are near zero, they have nowhere to go but up; I'd be wary of putting a lot of money in bonds right now.

The stock market has outperformed everything else for the past several years and is always a good investment in the long term. But there's a good chance there will be a market correction in the next year or two and at your age you probably shouldn't put a lot of money in stocks. But's not a bad idea to put some of your cash in a S&P 500 no-load index fund if you don't think you'll need it in the next five years.

Depending on the part of the country you're in, there's money to be made buying houses at depressed market prices, fixing them up and either renting them out or selling ("flipping") them. It is hard work but can be quite profitable.

If you talk to an investment advisor, pick one who is "fee-only", meaning he's not peddling any investments and makes his money only from fees he charges clients.
 
Find a reputable financial advisor you feel you can trust and determine your investment objective (preservation of capital, conservative growth,moderate risk growth, shoot-the-moon growth, etc.) If conservative growth is your plan, consider blue chips that have a history of paying dividends.
 
You can invest it with Con Manley....Investment analyst. Or with Cheatem, Duey and Howe Investment company.

Seriously, if you need access to the money in less than a year I would go with a CD. If you can hold the money for a long time then open up an IRA.
 
Financial advice from tractor repairmen.... but here goes, I"d also recommend Vanguard mutual funds. Extermely low cost, very reputable, you can search any number of them.
 
Get out of debt. Pay cash for next vehicle. Pay off house. Invest in either IRA or Roth IRA, depending on your age, tax bracket. I lost half my investment in Franklin in 2008, still haven't made back my loss.

With recent supreme ruling, coal is out, the bulk of our electricity is made from coal, so natural gas will be used in short term and like propane, nat gas will go up too.

Upgrade your house. Make it more energy efficient, get a small tax break, insulation, windows, doors, more insulation.

Up grade furnace. I would wait on A/C upgrade. Hearing on problems with 410A, too high pressures, aluminum coil failure. Some people in the business are saying a return to old style piston compressors and 417A.

Keep 50K or more in bank for pocket change.
 
So far the outdoor furnace and a shed for a LARGE amount of wood (you can buy it split) is the most surefire Idea I've seen listed.
 

MarkBMich has a good suggestion in "Flipping" houses. BUT, only if you know a good handyman guy real well. I have friends that were doing this before the meltdown, and were doing well at it. The home market is very good now and if you have a VERY good younger friend or relative you could provide cash and he most of the labor to buy fix-up and sell homes.
 
Larry, I'm holding 3 mortgages with considerably above normal rates. All have low loan-to-value ratios, assuring minimal risk to me.

I'm about to sell my mother's house. The Realtors were surprised when I suggested seller-financing be offered. Unusual, but can work wonders for some buyers. Without a substantial down and higher than standard rate I wouldn't do it, but for some buyers it is the best deal they can get.

2012 I put a substantial first mortgage on a house in Ga for a guy I knew. He didn't think much of my 6% rate and I told him to go look for folks with CDs (getting almost nothing) and dangle 4% in front of them. He chose to do business with me, loan-to-value is only 40%. I get letters every week offering to buy my paper, so it's somewhat liquid. Balloons in 4 1/2 years, when I'll look for another opportunity.

Another mortgage, older, is returning 8%. Have to check individual state laws about foreclosure procedures, but I haven't run into any problems.

Several years ago I ran into a shark here who paid off my mortgage the day before the foreclosure auction on the courthouse steps. I asked how that could work for him. Turns out he got a "deed in lieu of foreclosure" signed before the loan was given. One payment missed and he owned the house. Apparently legal here, but nothing I would do. The (previous) owners lost their 55% equity. I tried to work with them for 6 months (several options available) before giving up and starting foreclosure.

If I get cashed out of Mom's house I'll look for a land investment. I've done well with forcing appreciation, if I can find the right parcel. Last time returned 120% in a few months.
 
What types of things do you know about? I can make more $$$ with a couple thousand$ at a good auction or buying off CL than I'd make the rest of my life with so called 'investments'.Just bought a tiller off a CL ad last night for $400 that I can easily turn for 7 or 8 hundred.Stock Market is for the rich that can afford to loose what they put in and the 'retail' investors like yourself are the ones that get the crumbs from the table IF there are any crumbs left.Of course for those that want to sit on their duffs and do nothing for themselves or actually think then things like stocks,CDs,Bonds and the like are the way they have to go.Personally I'd be putting a good chunk of that $$$ into Gold and Silver.
 
obviously, I'll never be a rich man with the following attitude....

pay off all debt
put the rest in the bank

no risk, and it's there if you need it.
I still will get an occasional loan...at 0% of course, money is in there to pay it
off immediately if trouble arises.

As far as my money 'making' money....
naw, that's my job. If I need extra money, I do more jobs.
 
Talk to a professional that specializes in estate planning.

At 67, investments are a science.

There are SOOOO many tax, ss, and medical care implications to every step you take that it'll only make you weep for our nation if you ever tried to figure it out on your own.

As you age, the wolves start salivating more and more over your bank account. "Investing" becomes more an act of "protecting".

You're still young enough to make some good decisions now that can protect your money and shield it from the wolves. Just don't try to do it on your own.

You did say you're going to talk to a pro - I'm sure you will. I'm only stressing the importance of this.

I'd hate to see you devote even a small portion of the money to some idea you took from this site that sounds logical and wise, only to have it burn you 10 years down the road.
 
Shop around for a GOOD CPA. All CPA's are not created equal. I switched to a different CPA a couple of years ago. In the process, she revisited the last several tax returns that had been prepared by my previous CPA and got substantial refunds on them.

Your first big concern should be capital gains. Plan ahead for that. That's where a good CPA comes in to help you forecast. A couple of years ago, between federal and state, I had to shell out $65,000 in capital gains. There's no way around it, no way to stall on it, you just swallow hard and do it.
 
>Personally I'd be putting a good chunk of that $$$ into Gold and Silver.

You're nothing if not consistent, TF. Is that the same advice you'd have given a year ago, when gold was trading at over $1400/oz?

I'll give Fergie some alternate advice: If your heart is set on owning gold, wait. It hasn't bottomed out yet.
 
Google "Bogleheads" and educate yourself. Then read a book by John Bogle founder of Vanguard Group.
The only mutually owned mutual fund company. In essence a non-profit financial advisor.
Become a Boglehead and beat wallstreet.
 
Too bad we don't have a Wayback Machine so we can fly to 2004 and buy gold. The good new is, at the rate gold prices are falling, we may soon have a second chance to buy at '04 prices.
 
I think there's a lot to be said for paying down what you owe if that will save you interest without penalty... then making home improvements that will save you money. Beyond that... that which will provide you return will come with risk and that which comes without risk will not provide any return. Personally I'm getting a bit antsy about the market at the moment. That which rises will inevitably fall... and it's climbing back towards it's peak.

Rod
 
Don't know how much diving you do, may want to look at something that gets better mpg.

If you are healthy, want a sure bet, can live without the money, want to pass it on to another person tax free, look into a one time pay life insurance policy.
 
Your money isn't in the bank they've loaned it out banks have very little cash on hand compared to what their deposits are if you and others all need your money in case of some crisis none of you will be able to get anything.Check out what happened to the folks on Cyprus awhile back.Ferderal Deposit only has Billions in 'cash' which is really in the form of IOUs from the Gov't while they are 'guaranteeing' Trillions.Ever been Snipe hunting? It'll end the same way.
 
>If you are healthy, want a sure bet, can live without the money, want to pass it on to another person tax free, look into a one time pay life insurance policy.

Why, George? Very few of us will pay a nickel in estate or gift tax. If he wants to give his money away, he doesn't need any help from an insurance company to do that. But it sounds like he wants to retain some liquidity in his investment.
 
At age 64 I invested $25K, kids will get $70k if I die tomorrow. The sure bet is death and taxes. How long will it take to get that kind of return in the market? Then you would pay cap gains on it. Life insurance is tax free.

This may not be for everyone. If you have some cash sitting around, everything paid for, tired of market risks, real estate, CD's, making money only to send it to uncle sam, this may be something to consider.
 
George, I can see where that would be attractive under some circumstances. The biggest downside is you lose the liquidity of your money.

As for the return on your investment, you don't give enough information to calculate the rate of return, namely how long ago you bought the policy. Certainly the actuaries at the insurance company have figured it out so they're going to make money in the long run, even if they lose money on your particular policy. I assume the benefit must vary depending on how long you live, just as my universal life policy pays nothing if I make it to 62.
 
(quoted from post at 07:14:33 05/02/14) Shop around for a GOOD CPA. All CPA's are not created equal. I switched to a different CPA a couple of years ago. In the process, she revisited the last several tax returns that had been prepared by my previous CPA and got substantial refunds on them.

Your first big concern should be capital gains. Plan ahead for that. That's where a good CPA comes in to help you forecast. A couple of years ago, between federal and state, I had to shell out $65,000 in capital gains. There's no way around it, no way to stall on it, you just swallow hard and do it.
Click to expand...

There is away around capital gains. It's called a 1031 exchange.
 
25K = 70k death benefit, this is when you want to pass on to kids, don't know what to do with money, good rate of return. Just an option, may not be for everyone.
 
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