SilverDJ
Well-Known Member
What are your plans for an income source(s) in the next 20 years?
In my 60's I'd start to be prioritising that. The rest of the cash/metals thing is just some fun noise.
Newbie needs advice on strategy
- Thread starter Glenis
- Start date
What are your plans for an income source(s) in the next 20 years?
In my 60's I'd start to be prioritising that. The rest of the cash/metals thing is just some fun noise.
Glenis
Member
20 years ago I decided it would be good to have a number of sources of income and a diverse skill set. I taught myself a few different skills that I enjoy. I'm an affiliate for Amazon and others, I have a web shop, I make stuff to sell. Nothing pays big but $500 here, $300 there, plus a couple of other sources of more reliable, (but small) monthly income and it all adds up. Sooner or later we'll get superannuation/pension too. I also cranked down every expense I could so the money that comes in covers the minimal expenses. Not having to pay a mortgage or rent is a winner, takes a lot of stress away and puts money back in your pocket - highly recommended! We don't have expensive hobbies. Now we're semi-retired.
I don't doubt I'll get attached but I really try not to with other things I have/do. I often set up a calendar reminder to bump me into action, like a monthly 'Take 10% of months income, buy silver/gold '
Alloy
Active Member
That's funny, I had the same experience with Goldmoney. All I was trying to do was become an affiliate so I could get paid if I referred people to them (I'm writing a big article comparing online bullion prices – it'll be out this week). Their prices seemed to be edging closer to Bullion Vault's, so I thought they might end up being a firm I could recommend. But they practically wanted my first-born in order to open an account with them. I told them I just needed an account so I could participate in their affiliate program and refer people to them, but they still wanted a bunch of documentation on the source of the money I would be depositing and spending with them, even though it was likely to be only a few hundred dollars. For example, when their form asked how I got the money, I said it was from selling some Ethereum cryptocurrency. So then they asked for documentation of my few hundred dollar Ethereum sale (!) and bank statements. I was amazed at how nosy they were, and canceled the whole thing.
Bullion Vault was much more rational. They got an image of my ID I think and that was pretty much it, along with bank account numbers.
Glenis
Member
I always check reviews, if I can find them. Several complaints about accounts going on hold (locked out) while they got more security info from the account holder. Didn't fill me with confidence at all. I understand it's all to do with terrorism and drugs but tagging everyone a criminal until proved otherwise is time consuming. It also has the effect of making us slightly on-edge and un-trusting. It used to be an easier world to live in.
its not making any sense, no way I will put such as goldmoney based in usa
you are outside usa, i would put in Singapore or even Russia or China
US passport can not open account in many countries, NZ passport is not as restricted as usa passport holders
the place for people to flee to can be OZ or better in NZ (that is what people here would think)
you are outside usa, i would put in Singapore or even Russia or China
US passport can not open account in many countries, NZ passport is not as restricted as usa passport holders
the place for people to flee to can be OZ or better in NZ (that is what people here would think)
Glenis
Member
What would be the advantage to having silver in Singapore or Russia?
We're a bit protected in NZ because we're 2 main islands in the middle of the
Tasman sea and Pacific ocean.
problem with USD, if there is 50% devaluation... forced to take cash... can lost half
from what we seldom heard about, people store their gold in-vault in free port etc, many are well off
Singapore can be viewed as a strategic transit area
Russia, maybe same members from there can explain better
yeah NZ is very much the go to place and isolated, so it makes much more sense to keep it there rather than usa
from what we seldom heard about, people store their gold in-vault in free port etc, many are well off
Singapore can be viewed as a strategic transit area
Russia, maybe same members from there can explain better
yeah NZ is very much the go to place and isolated, so it makes much more sense to keep it there rather than usa
That's why is called "Lifeboat New Zealand".....cashed up elites from the US and other countries haven't bought boltholes in NZ for no reason...
https://www.theguardian.com/technology/2017/jan/29/silicon-valley-new-zealand-apocalypse-escape
SlyGuy
Active Member
Yes, this is very important. Very good advice. People become obsessed with proving they made the right investment by doubling down on it and refusing to sell for a loss. Well, who are they proving to? Themselves? Lol.
Stocks and gold and bonds and cash and everything are called "investment vehicles" for a reason. They get you from start A to goal B. You don't have to love an airplane or a taxi that gets you from one place to another... they are just vehicles. You ride for a little while or a long while and are probably never going to see that vehicle again. You also have many stocks or other investments which you sell and never buy again; they served their purpose and better opportunity now arose.
People who decide they have to love their stock or their PM or whatever they buy tend to over-allocate into that... and then tend to be reluctant to ever sell it since they are emotional about it. It is best not to get attached like that; more and better opportunities come along all the time. You have to keep a pulse on all markets with the overall goal of swimming with the currents. Emotion and lack of education has too many people just clinging to a tree in the river - or even worse: swimming against the forces. Those people should probably just be indexing and dollar cost averaging for best results.
The biggest investment emotion trap of all is clearly the single family "home" (real estate sellers love to call it that; they know that word is more emotionally charged than "house"). Whenever people have extra monies, they like to do repairs or remodel or redecorate on their house... it is the investment they know well and are comfortable with. They have fallen in love with the house or the idea of the house being their savior when they will sell it. It is seldom the best use of that money if growth is the goal, but try telling them that (that would usually be paying down the mortgage or growth stocks).
For unallocated in the USA, there is basically just the big banks as options for PM accounts... some do free storage on unallocated, but they all charge roughly 1% on each transaction... and worst, nearly all use third party storage (probably LBMA?). They basically just run the accounts and create a middle man, which adds cost. We have nothing like the LBMA or Perth unallocated services... which is funny, since USA has some of the best bullion dealer prices in the world. I hope they will offer it in the future... with on-site storage and low transaction cost.
I am not a fan of GLD and SLV as I said, but that, or bonds, is actually where I sometimes park some cash I want to temporarily keep out of stock markets.
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Over here in Australia we have one big advantage of owning your own home and using it as your principle place of residence. When you do come to sell it, it is fully capital gains tax free, no tax to pay. And if you channel all your cash into a multi million dollar mansion and live in it and have no other assets you still get a fully funded free government pension, it is not assets tested. Basically, the family home is untouchable and I don't think that's going to change anytime soon as the population is ageing and are a very strong voting block.
SlyGuy
Active Member
Yep, that is very impressive tax benefit. I'm not saying a home is not a good investment for most folks. I simply brought the owner-occupied home up as the type of investment that the average Joe probably gets the most emotional about. People tend to cling to it, double down by pouring more money in, even pass on good sell or away job opportunities due to not wanting to leave their house, fail to downsize residence when kids leave because the neighborhood is familiar, etc. There are many financial decisions which can be swayed by emotion, but the home mortgage is the king of the hill (that's probably why mortgage means what it does in its French roots!).
Glenis
Member
Same in NZ, no captial gains tax, although they are starting to look at capital gains on property other than your home - investment properties, holiday homes. I'm not against this especially on investment properties. Like Australia we have 'negative gearing' where investors get quite a tax break. I feel that the NZ taxpayer has chipped in for the investor to make a profit and when they realise the profit then the tax payers should get a cut. Our pension isn't income tested either so you can have $10 in the bank or $25mil and you're still entitled to a pension. We don't have gift tax, you can gift anyone any amount of money or assets and we don't have inheritance tax, I agree with these because tax has already been paid when it was earned.
Profits from sales of Gold and Silver are taxed.
That's where our system differs. We are assets tested on everything else including bullion and the family car. It is only the family home that isn't and that's why a lot of seniors won't downsize and why a lot of people put a lot of money into the family home. Our threshold for other assets is around 800k (for couples) and then the pension cuts out entirely. In other words, you can have a $5 million dollar house and live in it and collect a full pension. However if you have a $1 Million house and $4 million in the bank you get nothing. Those with the $5 million house think this is a good thing, those with money in the bank thinks this is unfair, but those are the rules.
Glenis
Member
We've shut the door on most foreign ownership now. We don't have enough houses for our own population and the prices kept sky rocketing, in part due to overseas buyers. Apart from rich Americans buying the best blocks of land, the Chinese (Asian) were allowed to buy multiple properties, many of these properties are vacant and kept in reserve for a bolt hole and many others are rented out by managers while the owners remain in China (or where ever).
The new Labour government has stopped overseas buyers and is now on a campaign to build up our housing stock with a focus on affordable home. We've never had a homeless problem but we do now. Affordable in NZ's biggest city of Auckland is $600,000+, for that you'll get a new 2 bedroom (3 if you're lucky) on a tiny section probably attached to your neighbour with a garage separating the 2 - or a block of 5+. If you want something better than that you'll be into $1mil plus.
Glenis
Member
I can see asset testing coming to NZ. Every government needs to save where they can with the tsunami of retirees on the way. The question is what sort of allowance before we lose the NZ pension? Everyone talks about saving for their retirement but at the end of the day they want to keep all the investments to hand down to the kids and let the government support them. That's going to change whether we like it or not. I've never bought into the "we've been taxpayers all our lives and we've earned the pension" - no we haven't, we've paid for the roads, police, education, hospitals etc, and a tiny bit has been put aside for future pensions.
Alloy
Active Member
We have the same capital gains tax exemption in the US. Well, mostly. If you live in the home for at least two years you can exempt $250,000 in gains from a home sale if you’re single and up to $500,000 if you’re married filing jointly.
ZaidaBoBaida
Member
True story - just a few short years ago my grandmother was pretty well off. We all had an expectation of at least a small inheritance. Then, she had a stroke - and had to go into a nursing home. Now, all her money is gone, and she's having to go on Medicaid.
Glenis
Member
It's true, you don't know the future but sometimes it works the other way too and you get something you don't expect.
I learnt about this ban on foreign buyers but I don't quite understand why would you need to ban when you can simply impose a stamp duty or property purchase tax? Singapore has a 20% buyer's stamp duty for buyers from China. HK has a 30% stamp duty. It's not difficult to see that this stamp duty is tremendously profitable for the government which makes $400k from a typical $2m property sale where the buyer is a foreigner. Singapore's stamp duty on property purchase extend to corporations so foreigners cannot setup a company to circumvent the tax.
How does the government know how much bullion you have got?
Sounds like the opposite of Singapore. Singapore doesn't have a pension program today, but there are healthcare subsidies that citizens can apply depending on the value of the home they stay in. If they stay in a government flat, they will get a higher subsidy.
This will explain why the Australian property market only goes up. But if there were an fiscal crisis that will cause the Australian government to cut pensions, wouldn't it also cause a collapse of the property market because there's less incentive to keep the multi-million dollar house?
By the way, would this also explain why the physical market is so vibrant in Australia? Because money in the bank will go into the asset count?
ZaidaBoBaida
Member
Part of the reason I stack silver and gold is because the government doesn't know I've got it, or at least they don't know how much.