"SHOW ME THE MONEY" VIEWS on HOW to make MONEY GR

[MJZiggy]

Thanks B!!

[Patler]

Thanks for the great advice Rock. Ive only been doing it for 2 years and after 4 years you are "vested" which means its all yours to keep right?.

If you are 100% vested after four years. Things may be different now, but some that I knew about before had staged vesting, where after a few years you vested in 25% of the company contributions, a few years later it was 50%, etc. The company I was at it took 10 years to vest 100% in their contributions. I think some of that has changed since many companies no longer offer traditional pension plans anymore. Vesting periods in 401ks have become shorter.

[Bretsky]

On the subject of credit cards, I read somewhere about signing up for those 0% APR for a year type of deals and then when the year is almost up transferring all your balance to another offer for 0% interest. Does anyone do this?

I've heard you can really screw up your credit rating if you do that. They leave the credit card you transferred from open and you end up with a screwed up debt to credit available (is that right?) ratio.

Hmm, but the ratio is based on actual money owed not how many different accounts you have. Right?

Let me see if I can get this right. It's based on how much money you owe against the credit limits of all your accounts. I'm guessing the worry is that if you take out a mortgage with having only $2K on credit cards, but have $40K available to you, you could go out and amass all sorts of debt and default on your loan. Can any of the numbers people tell me if that's why?

If you are maxed out on all of your credit limits then the current debt ratios are high, which has an adverse effect on credit.

I don't think individuals are penalized at all credit wise if they have access to 40G but only have balances of 2500. In reality the reason they have so much available is because their credit is good.

[Bretsky]

Thanks for the great advice Rock. Ive only been doing it for 2 years and after 4 years you are "vested" which means its all yours to keep right?.

If you are 100% vested after four years. Things may be different now, but some that I knew about before had staged vesting, where after a few years you vested in 25% of the company contributions, a few years later it was 50%, etc. The company I was at it took 10 years to vest 100% in their contributions. I think some of that has changed since many companies no longer offer traditional pension plans anymore. Vesting periods in 401ks have become shorter.

In WI most companies have a 5 year vesting period from what I see. If Mad has 4 years that would mean after 4 years all company contrubitions as well as his own are his. And most likely, if it's 4, then each year you work there you are 25% more vested.

[MadtownPacker]

If you are 100% vested after four years. Things may be different now, but some that I knew about before had staged vesting, where after a few years you vested in 25% of the company contributions, a few years later it was 50%, etc. The company I was at it took 10 years to vest 100% in their contributions. I think some of that has changed since many companies no longer offer traditional pension plans anymore. Vesting periods in 401ks have become shorter.

Yeah its 100% after 4 years. After reading all this stuff Im thinking I might have a sweet deal cuz after 6 years they match $4 for every $1 of mine. After like 10 years it is $6 for every $1.

[Patler]

I don't think individuals are penalized at all credit wise if they have access to 40G but only have balances of 2500. In reality the reason they have so much available is because their credit is good.

Far be it from me to argue with a banker, but I will!

I don't think that is entirely correct. Its not a serious penalty, but your credit score can be decreased for high outstanding available credit lines. I was real curious when the annual free reports came out last year, so I called and talked to a couple. One of the things I found out was that if you have a lot of unused credit cards, such that you could, if you were of a mind to do it, go out and charge $50,000 tomorrow using 25 different cards, you will lose some score points because of it.

The solution is simple. You call some of the unused card companies, and formally cancel the card. You can even request them to report that to the credit agencies.

It's kind of a Catch 22, though, because it also is not good if you have no available credit, or so I was told. It's good to have some, but not too much!

[Patler]

Yeah its 100% after 4 years. After reading all this stuff Im thinking I might have a sweet deal cuz after 6 years they match $4 for every $1 of mine. After like 10 years it is $6 for every $1.

That is pretty impressive. You make 400% on your money the year you invest it! What is the maximum that you are allowed to contribute that they will match? Whatever it is, do it!!!!

[Fosco33]

If you are 100% vested after four years. Things may be different now, but some that I knew about before had staged vesting, where after a few years you vested in 25% of the company contributions, a few years later it was 50%, etc. The company I was at it took 10 years to vest 100% in their contributions. I think some of that has changed since many companies no longer offer traditional pension plans anymore. Vesting periods in 401ks have become shorter.

Yeah its 100% after 4 years. After reading all this stuff Im thinking I might have a sweet deal cuz after 6 years they match $4 for every $1 of mine. After like 10 years it is $6 for every $1.

I guess I'm lucky. My company matches 100% of the first 3% you put in and 50% on the next 2% and it's fully vested - immediately. I then have plan setup with my financial company that pours the money into diversified accounts automatically. Very little work required on my end.

[Bretsky]

I don't think individuals are penalized at all credit wise if they have access to 40G but only have balances of 2500. In reality the reason they have so much available is because their credit is good.

Far be it from me to argue with a banker, but I will!

I don't think that is entirely correct. Its not a serious penalty, but your credit score can be decreased for high outstanding available credit lines. I was real curious when the annual free reports came out last year, so I called and talked to a couple. One of the things I found out was that if you have a lot of unused credit cards, such that you could, if you were of a mind to do it, go out and charge $50,000 tomorrow using 25 different cards, you will lose some score points because of it.

The solution is simple. You call some of the unused card companies, and formally cancel the card. You can even request them to report that to the credit agencies.

It's kind of a Catch 22, though, because it also is not good if you have no available credit, or so I was told. It's good to have some, but not too much!

I can buy this, but rather than penalized "at all" I will preface by saying penalized "minimally".

I've witnessed scores dip hard after the fact when people who had a lot of revolving credit available used it.

And I have seen the message "too many revolving accounts" on credit reports so you are right in that it has some impact.

But to take things a bit further, most of the time when I see "too many revolving accounts" it is on a credit report with a person who has great credit.

And in the notes on each credit report, it lists reasons (normally four) of why you don't have a "perfect" score. And if there are no great reasons why somebody's score is 825 instead of 850 that seems to be the message it spits out on the credit report every time.

That being said, being responsible and making payments on time is most of what defines your credit.

[Bretsky]

Yeah its 100% after 4 years. After reading all this stuff Im thinking I might have a sweet deal cuz after 6 years they match $4 for every $1 of mine. After like 10 years it is $6 for every $1.

That is pretty impressive. You make 400% on your money the year you invest it! What is the maximum that you are allowed to contribute that they will match? Whatever it is, do it!!!!

I'd agree that you have an amzing plan; that sounds too good to be true in Wisconsin. If you stay at that company forever you are pretty much going to retire wealthy.

[MadtownPacker]

That is pretty impressive. You make 400% on your money the year you invest it! What is the maximum that you are allowed to contribute that they will match? Whatever it is, do it!!!!

Damn, I didnt know if I was getting ganked or not. Ive never had any of this stuff. I dont know about the max but I think I will following your advice.

[Patler]

That being said, being responsible and making payments on time is most of what defines your credit.

You darn bankers are all the same, you expect us to pay back the money you give us!

[Partial]

this is a really good topic!! I am thinking immediately after college I will sacrifice as much money as I can and invest into 401k and IRA. I figure I will probably rent for awhile before I get settled. Would it be a better idea to take out a mortgage and buy a duplex, fix it up, and rent one unit while living in the other, and then rent them both out once I get settled with a family?

[Bretsky]

this is a really good topic!! I am thinking immediately after college I will sacrifice as much money as I can and invest into 401k and IRA. I figure I will probably rent for awhile before I get settled. Would it be a better idea to take out a mortgage and buy a duplex, fix it up, and rent one unit while living in the other, and then rent them both out once I get settled with a family?

TO ME that is absolutely the smartest way to go. That being said, it's easier done while single. I wanted to do this right when we were married but da wife kaboshed it.

The only complication is you need 5% down when buying a duplex so you have to save up a bit. Where with a single family home there are loads of on money down programs.

So you buy the duplex, and when you get married then you buy a home if your chick doesn't want to live in one.

You find another renter, and already have equity in a property plus you then have two renters paying down your mortgage. The key is finding a duplex at the right price that you like. Keep in mind that years down the road you will want both rents be be greater than the mortgage payment. Many I know use a simple formula that I'd agree with. On a duplex for 120G, you want about 1200 of rent coming in. Problem is with how houses have appreciated it's very hard to find a duplex where that forumula works anymore, and if it does the property is often in a tougher part of the neighborhood.

Also, it's far better to spend the time to find a good renter than rush to get a place rented. Many landlords are finding ways to pull credit on applicant rentors and look up their information on a website for criminal history. If you go this route you need to really do your due diligence on any renter you are considering.

BE SURE that IRA you start up is a "Roth" IRA. And many employers require you to work a full year before being able to get into the 401K. You can get the Roth IRA started either way.

[GrnBay007]

For the ROTH IRAs is there a maximum you can put in per year? Also what's the minimum you can put in? Anyone know?



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