On Apr 19, 4:48 pm, Tad Borek <bore...[at]pacbell.net> wrote:

- quote -

Thanks. May do that in the near future.

kastnna wrote:
- quote -

I custody through Fidelity Institutional so that's where most of these
are. As Rich posted, Fidelity retail has a free solo-k offering, they
have info on their web site about it (I think he's the one I heard about
that from, here on MIFP). Retail had a better offering than
institutional for awhile. Feel free to email me if you want to chat
about Fido as a custodian, I've used them for about 3 1/2 years.

-Tad

kastnna <kastnna[at]auburnalum.org> writes:

- quote -

Fidelity has a no-fee self-directed brokerage solo 401(k).
Only fees are commissions (and then only if you buy
commissionable securities). I imagine other brokers have
similar offerings.

--
Rich Carreiro rlcarr[at]animato.arlington.ma.us

On Apr 19, 11:37 am, Tad Borek <bore...[at]pacbell.net> wrote:
- quote -

Tad,
We have been doing alot of the same when contribution maximization is
a primary goal. You mentioned "cheap" with the i401(k). Who's product
do you use? The cheapest I have been able to find are around $150-$250
annually. I realize that is generally a very small percentage of
assets (especially if clients are wanting to max contribs), but people
compare that to a $25 annual SEP fee and complain to no end.

Just wondering if you have had any luck finding lower annual fees?

John A. Weeks III wrote:
- quote -

Just an update on this...it's now become just as easy/cheap to set up a
solo-401k plan and I've replaced many SEPs with them. The principal
advantage is flexibility with contribution limits. The SEP has that
contribution limit of, essentially, 20% of your income, while the
solo-401k is $15,500 (for 2007, or $20,500 if over 50) as an "employee
deferral" plus that 20% as an employer contribution.

So you can use that higher limit when you want to, or you can keep to
the normal SEP limits (or below) when that's your preference. With that
extra flexibility, if it works for your business, the solo-ks can really
make sense these days.

-Tad

On Apr 19, 4:00 am, skunker <skun...[at]gmail.com> wrote:
- quote -


In our neck of the woods (Southeast US) a $2M umbrella policies costs
me about $300.00 a year. Mine covers the liabilities I am likely to
incur should I ever be sued because someone "trespasses on it, gets
hurt, falls, breaks a hand, etc".

On Wed, 18 Apr 2007 04:02:57 -0500, skunker <skunker[at]gmail.com> wrote:


- quote -

Whenever I'm presented with two good opportunities, each of which is a
good long-term bet, I am very happy straddling the fence. So why not
do some of both?

My assumption is that you will hold long-term. On the other hand, if
you are likely to need this money in a decade or two, I'd probably
find something more short-term. One of the best lessons I've learned
is to never sell good land or good stocks.





-HW "Skip" Weldon
Columbia, SC

In article <1176945024.096346.143110[at]n59g2000hsh.googlegroups.com> ,
skunker <skunker[at]gmail.com> wrote:

- quote -

Being an airplane fanatic myself, I now understand.

I don't have a problem with you buying land if you know going into
that you buy it as a toy or hobby, and that it has expenses over time.
Making money should be incidental, not the reason. The biggest point
that I wanted to make is that you go into it with your eyes wide open.

Just look at all the folks that bought condos in pre-construction
hoping to flip them for an east $50K or $100K, and now they are
upside down by over $100K with no buyers, and they are stuck with
the high payments. Those people were blinded by the hype, and
many will lose their pants in the deal. I didn't want you to go
into this thinking you would make a killing on the deal.

Since you are a creative go-getter, perhaps you can find ways
to make some money off of this land. Leasing hunting rights might
be one way. Or leasing space for others to put up T-hangers. Or
getting into the horse boarding business. Or putting down some
pads for people to lease for RV's.

- quote -

That is one risk. The idea is to carry insurance. You probably
also should have at least $1-million in umbrella policy insurance
(the so called Bill Clinton policy since his State Farm umbrella
policy paid off one of his bimbo cases). That goes double since
you are self employed--being a business person, you are a target.

Another insurance item is to make sure that your vehicle, if you
use it for business, is insured for business usage.

-john-

--
================================================== ====================
John A. Weeks III 952-432-2708 john[at]johnweeks.com
Newave Communications http://www.johnweeks.com
================================================== ====================

On Apr 18, 6:53 pm, "John A. Weeks III" <j...[at]johnweeks.com> wrote:
- quote -

Thanks John, will look into the SEP-IRA. Btw, about the land...all the
things you said about it is one of the reasons why I want it:
isolation, upkeep (i love working on the land, cutting grass, etc, get
away from the city). Gotta mow down that grass strip...hopefully I can
get this old plane flying.

I am scared about land liability...gotta look into that. So if someone
trespasses on it, gets hurt, falls, breaks a hand, etc they can sue me?


======================================= MODERATOR'S COMMENT:
Please trim the post to which you are responding. "Trim" means that except for a FEW lines to add context, the previous post is deleted.

In article <1176901377.042477.17400[at]l77g2000hsb.googlegroups.com> ,
skunker <skunker[at]gmail.com> wrote:

- quote -

Land eats. It eats taxes, insurance, and upkeep. It presents
a liability. And it doesn't have a rate of return. It just
sits there doing nothing but eating.

You do hear about people who sell their farm for $1-million
an acre or have a Wal-Mart built across the street. But just
as often, you hear about someone who was the next section
from the new subdivision, and they waited all of their life,
and the city never grew to take them over. You cannot predict
what is going to happen here, it is all luck.

Others have done studies on land values and housing. If land
was a good long term investment, it would take very many years
before nobody could afford to buy it. Then, buy the laws of
supply and demand, the bubble would have to break, and then
normal people could buy it again. As a result, the values of
land and houses are throttled by what people can afford. If
the prices get ahead, like they did in the 2000's, you eventually
have a market collapse like we are starting to see today.

-john-

--
================================================== ====================
John A. Weeks III 952-432-2708 john[at]johnweeks.com
Newave Communications http://www.johnweeks.com
================================================== ====================

In article <1176901055.529702.284460[at]y80g2000hsf.googlegroups.com> ,
skunker <skunker[at]gmail.com> wrote:

- quote -

If you are self-employeed, then you have an opportunity to use
one of the single best tax strategies ever invented. It is called
the SEP plan. If you don't have a SEP (or a Simple), then run
down to your broker or financial planner and get one right now
today. If you don't have a broker or planner, then get one of
them, too. SEP plans let you put a way a huge amount of money
each year, far more than an IRA. And the way taxes work, the
government kicks in $1 for every $2 that you put in. That is
absolutely free money that you would otherwise pay in taxes.
Don't pass this one up.

-john-

--
================================================== ====================
John A. Weeks III 952-432-2708 john[at]johnweeks.com
Newave Communications http://www.johnweeks.com
================================================== ====================

On Apr 18, 8:36 am, skunker <skun...[at]gmail.com> wrote:
- quote -

I have to agree with John here. Investments can have a recurring
return (interest, dividend, rent, grazing fee, sharecropping fee) or a
one time return (appreciation). Your investment seems to be only
looking for appreciation. Not only do you lose the value of your
initial investment, you will be paying property taxes and other
expenses every year on it. These are funds you could have invested
for a return. You also have the liability of a land owner that
someone will get hurt on your land. Nobody every broke a leg tripping
over the S&P500 index fund.

On the good side, you are doing an excellent job socking money away.
So live a little. If you want to get some experience with real estate
and with enjoy the land somehow (camper on the pickup truck and dirt
bike?), why not go for it. It's exciting thinking you may double your
money in a few years. But with experience you may regret the lack of
recurring revenue.

Keep Up the Good Work!

On Apr 18, 11:52 am, Douglas Johnson
<john...[at]classtech.NOTPARTOFADDRESS.com> wrote:
- quote -

It looks like he has the right idea, but has greatly exaggerated the
effect.

Assuming a return of 10% per year, a single $1.00 invested at age 20
grows to $490.37 at age 85, while $10.00 invested at age 30 grows to
$1,890.59 at age 85, and $100.00 invested at age 40 grows to $7,289.05
at age 85.

So, the age 40 investor receives 14.86 times the return of the age 20
investor, but he invested 100 times as much. The age 30 investor
receives 3.86 times the return of the age 20 investor, but he invested
10 times as much.

At 5% per year, the totals are $23.84, $146.36, and $898.50

The age 40 investor now receives 37.69 times the return of the age 20
investor. The age 30 investor receives 6.14 times the return of the
age 20 investor.

At 1% per year, the totals are $1.91, $17.29, and $156.48

The age 40 investor now receives 81.93 times the return of the age 20
investor. The age 30 investor receives 9.05 times the return of the
age 20 investor.

"John A. Weeks III" <john[at]johnweeks.com> wrote:


- quote -

How do you figure this? 10x return in ten years is roughly a 30% return on
investment.

-- Doug

Thanks John,
Yes, I agree with you and I was thinking of putting more power into
the IRA and not touching it. I don't have a 401K because I work for
myself, my income increases every year, but slowly. The thing about my
current Roth IRA is that it's one of those "lifecycle" packages from
Vanguard. I think it's called the Vanguard Target Retirement account
and mine is set for 2047 i think, I'll have to double check. Anyways,
it just sucks watching the numbers grow so slow...sometimes
$10...other times $100...but it seems that it's on average with the
money market accounts.

What other things do you suggest I invest in?

On Apr 18, 7:01 am, "John A. Weeks III" <j...[at]johnweeks.com> wrote:
- quote -

John, forgot to ask, but why is land such a poor investment? By me,
the prices are double each year and the realtors are just laughing all
the way to the bank. Here's a quote I stole from some realtor who left
a comment on someone else's blog:

"I am on the XXX City Council and have heard rumors of a 1700 ac.
property selling for as much as $45,000-$50,000 per acre, in the SE
part of the county. We have sold smaller ranches in the $5,000-$10,000
p.a. range. We can't keep anything in our inventory, although there
are a few of those sleepers that have not sold the way they should,
but certainly, their time is coming....."

..."But try and find something on it for sale and you'll find real
quick that there aren't any deals unless you are the seller. The folks
are willing to pay the prices, no matter how outrageous."

It's true, in my area, you can't find land for anything less than 5k
an acre and with the population growth in the area, people are dying
to get away from the city (so am I).

Seriously, is land such a bad investment? My main goal for this is for
recreational use, but of course, if it's worth something when i'm 60
years old, then all the better.

In article <1176865568.688090.124680[at]d57g2000hsg.googlegroups.com> ,
skunker <skunker[at]gmail.com> wrote:

- quote -

At your age, maxing out the IRA options and any 401K or similar
plans is the best thing you can do. Every dollar that you put
away in your 20's is with $10 in your 30's, worth $100 in your
40's, worth $1,000 in your 50's, worth $10,000 in your 60's,
and worth $100,000 in your 70's.

You might think that plus or minus a dollar here and there
doesn't mean much right now. After all, you are young, life
is long. But those are exactly the two factors that make ever
dollar right now so critical. Making a $1 dollar decision today
is the same as making a $1-million dollar decision when you are
85 years old.

- quote -

You don't want to raid your IRAs. The value of the growth
over the next 40 years will be far more valuable than any piece
of land. You are making a multi-million dollar decision here,
so don't blow it.

Three points of advice:

1) get your IRA money working harder. A fixed rate of return
is only going to just keep up with inflation over the years.
You need more horsepower than that. Invest in the market.
It should average 11% for you over time, if history means
anything. Over the life of your IRA, that will again be the
difference of at least a million dollars.

2) land is a very poor investment. It almost never pans
out, and it costs a lot to carry it. But if you understand
that going in, that you will only use it for fun and never
get anything else out of it, that is OK. Keep your credit
solid and buy the land with a loan when the time comes.
Don't raid your IRAs or 401Ks.

3) if your job doesn't offer a 401K or similar program,
start looking for a job that does. Again, that is a million
dollar issue over your lifetime.

-john-

--
================================================== ====================
John A. Weeks III 952-432-2708 john[at]johnweeks.com
Newave Communications http://www.johnweeks.com
================================================== ====================

Hey guys, 25 years old here. I have a few questions:

I am looking to purchase some land for recreational purposes (and
investment) in the next two years. Currently, I have $20k saved up in
a MMarket account with interest at 5.05% and 5K in a Roth IRA. My
ULTIMATE goal, in the next 2 years, is to purchase land out in the
country (I'm in Texas). I don't want to wait until I'm 30.

I have been socking away about 1,000 a month into the MM and maybe 500
or so in the IRA. My monthly job income is about 2,500. My monthly
expenses are around 600.

With this said, do you all think it's better for me to focus on maxing
out the IRA every year or should I keep putting money into the MM?

I don't know if this is enough info for you guys, but I appreciate any
advice you can provide. I do have PERSONAL FINANCE for dummies, thanks
for the recommendation!

Yes, I am aware that I can take out money without penalties under the
Roth IRA for down payments, but is this also available for LAND
purchases and not homes?