From a terrible start, 2016 turned out to be my most financially successful year ever!
My net worth went up an incredible $253,000!
After the terrible market performance in 2015, with both the stock market down and creating many losses in my 401K, and the value of Warmlands ave decreasing, 2016 represented an agressive bounce in all my assets.
The Auckland property market continued to roar ahead with almost 15% gain. The light at the end of the Eden2 tunnel finally seemed to be showing, with the realization that my apartment could be worth over $400,000 NZD when sold. Even with the additional renovation costs and repayment of the existing load, I will target USD $200,000 cash.
The goal for that cash is now becoming clear. I need to turn it into a lot of assest with a strong cash flow for retirement and the kids education.
Plutocrats, Oligachs, Kleptocrats and Kleptocratic Capitalism
Plutocracy
Plutocracy (from Greek πλοῦτος, ploutos, meaning "wealth", and κράτος, kratos, meaning "power, dominion, rule") or plutarchy, is a form of oligarchy and defines a society ruled or controlled by the small minority of the wealthiest citizens. The first known use of the term was in 1652.[1] Unlike systems such as democracy, capitalism, socialism or anarchism, plutocracy is not rooted in an established political philosophy. The concept of plutocracy may be advocated by the wealthy classes of a society in an indirect or surreptitious fashion, though the term itself is almost always used in a pejorative sense.[2According to Noam Chomsky and Jimmy Carter, the modern day United States resembles a plutocracy, though with democratic forms.[7][8]
Historically, wealthy individuals and organizations have exerted influence over the political arena. In the modern era, many democratic republics permit fundraising for politicians who frequently rely on such income for advertising their candidacy to the voting public.
Whether through individuals, corporations or advocacy groups, such donations are often believed to engender a cronyist or patronage system by which major contributors are rewarded on a quid pro quo basis. While campaign donations need not directly affect the legislative decisions of elected representatives, the natural expectation of donors is that their needs will be served by the person to whom they donated. If not, it is in their self-interest to fund a different candidate or political organization.
While quid pro quo agreements are generally illegal in most democracies, they are difficult to prove, short of a well-documented paper trail. A core basis of democracy,[citation needed] being a politician's ability to freely advocate policies which benefit his or her constituents, also makes it difficult to prove that doing so might be a crime. Even the granting of appointed positions to a well-documented contributor may not transgress the law, particularly if the appointee appears to be suitably qualified for the post. Some systems even specifically provide for such patronage.
Oligarchy
Oligarchy (from Greek ὀλιγαρχία (oligarkhía); from ὀλίγος (olígos), meaning "few", and ἄρχω (arkho), meaning "to rule or to command")[1][2][3] is a form of power structure in which power effectively rests with a small number of people. These people might be distinguished by nobility, wealth, family ties, education or corporate, religious or military control. Such states are often controlled by a few prominent families who typically pass their influence from one generation to the next, but inheritance is not a necessary condition for the application of this term.
Throughout history, oligarchies have often been tyrannical, relying on public obedience or oppression to exist. Aristotle pioneered the use of the term as a synonym for rule by the rich,[4] for which another term commonly used today is plutocracy.
Roman society was an Oligarchy, with a group of around 10,000 wealthy people controlled a near global population of 60 million.
Roman society was an Oligarchy, with a group of around 10,000 wealthy people controlled a near global population of 60 million.
Kleptocracy
Kleptocracy, alternatively cleptocracy or kleptarchy, (from Greek: κλέπτης - kleptēs, "thief"[1] and κράτος – kratos, "power, rule",[2] hence "rule by thieves") is a term applied to a government seen as having a particularly severe and systemic problem with officials or a ruling class (collectively, kleptocrats) taking advantage of corruption to extend their personal wealth and political power. Typically this system involves the embezzlement of state funds at the expense of the wider population, sometimes without even the pretense of honest service.
Kleptocracies are generally associated with dictatorships, oligarchies, military juntas, or other forms of autocratic and nepotist governments in which external oversight is impossible or does not exist. This lack of oversight can be caused or exacerbated by the ability of the kleptocratic officials to control both the supply of public funds and the means disbursal for those funds. Kleptocratic rulers often treat their country'streasury as a source of personal wealth, spending funds on luxury goods and extravagances as they see fit. Many kleptocratic rulers secretly transfer public funds into hidden personal numbered bank accounts in foreign countries to provide for themselves if removed from power.
Kleptocracy is most common in developing countries whose economies are based on the export of natural resources. Such export incomes constitute a form of economic rent and are easier to siphon off without causing the income to decrease.
Kleptocratic Capitalism
In the last three decades the USA has developed a modified form of Kleptocracy that neatly fits the label Kleptocratic Capitalism. In Kleptocratic Capitalism, rather than powerful figures in government taking systemic advantage of corruption to obtain wealth, a small group of extremely wealthy individuals corrupt the capitalist system itself.
Whearas the goal of capitalism is to generate wealth through growth, Kleptocratic Capitalism does not have the objective of creating new wealth by growing companies or investing in research, technology or employee education. Rather it's sole objective is wealth transfer of existing wealth out of public scrutiny into private ownership. Once in private ownership, it is free from public scrutiny or oversight and the ownership rights can be further consolidated into fewer and fewer ever more powerful individuals.
Some of the techniques used in Kleptocratic Capitalism are privatization of government assets, financial transactions that are so complex that regulators are not able to monitor or understand them, offshore banking and tax avoidance schemes, unregulated (dark) financial markets, complex and highly leveraged derivatives, aggressive merger and acquisition (M&A) designed to transfer wealth from public company to private ownership, and leveraged buyouts of public companies by private equity investors.
Effectively Kleptocratic Capitalism canibalises existing wealth, and creates escalating wealth inequality in society.
Whearas the goal of capitalism is to generate wealth through growth, Kleptocratic Capitalism does not have the objective of creating new wealth by growing companies or investing in research, technology or employee education. Rather it's sole objective is wealth transfer of existing wealth out of public scrutiny into private ownership. Once in private ownership, it is free from public scrutiny or oversight and the ownership rights can be further consolidated into fewer and fewer ever more powerful individuals.
Some of the techniques used in Kleptocratic Capitalism are privatization of government assets, financial transactions that are so complex that regulators are not able to monitor or understand them, offshore banking and tax avoidance schemes, unregulated (dark) financial markets, complex and highly leveraged derivatives, aggressive merger and acquisition (M&A) designed to transfer wealth from public company to private ownership, and leveraged buyouts of public companies by private equity investors.
Effectively Kleptocratic Capitalism canibalises existing wealth, and creates escalating wealth inequality in society.
Class Definitions in USA
Academic class models
Top-level executives, high-rung politicians, heirs. Ivy League education common.
Upper middle class(15%)
Highly-educated (often with graduate degrees), most commonly salaried, professionals and middle management with large work autonomy.
Lower middle class (30%)
Semi-professionals and craftsmen with a roughly average standard of living. Most have some college education and are white-collar.
Working class (30%)
Clerical and most blue-collar workers whose work is highly routinized. Standard of living varies depending on number of income earners, but is commonly just adequate. High school education.
Working poor (13%)
Service, low-rung clerical and some blue-collar workers. High economic insecurity and risk of poverty. Some high school education.
Underclass (12%)
Those with limited or no participation in the labor force. Reliant on government transfers. Some high school education.
References: Gilbert, D. (2002) The American Class Structure: In An Age of Growing Inequality. Belmont, CA: Wadsworth, ISBN 0534541100. (see also Gilbert Model);
Top-level executives, celebrities, heirs; income of $500,000+ common. Ivy league education common.
Upper middle class/Professional Class (15%)
Highly-educated (often with graduate degrees) professionals & managers with household incomes varying from the high 5-figure range to commonly above $100,000.
Lower middle class (32%)
Semi-professionals and craftsmen with some work autonomy; household incomes commonly range from $35,000 to $75,000. Typically, some college education.
Dennis Gilbert, 2002
Capitalist class (1%)Top-level executives, high-rung politicians, heirs. Ivy League education common.
Upper middle class(15%)
Highly-educated (often with graduate degrees), most commonly salaried, professionals and middle management with large work autonomy.
Lower middle class (30%)
Semi-professionals and craftsmen with a roughly average standard of living. Most have some college education and are white-collar.
Working class (30%)
Clerical and most blue-collar workers whose work is highly routinized. Standard of living varies depending on number of income earners, but is commonly just adequate. High school education.
Working poor (13%)
Service, low-rung clerical and some blue-collar workers. High economic insecurity and risk of poverty. Some high school education.
Underclass (12%)
Those with limited or no participation in the labor force. Reliant on government transfers. Some high school education.
References: Gilbert, D. (2002) The American Class Structure: In An Age of Growing Inequality. Belmont, CA: Wadsworth, ISBN 0534541100. (see also Gilbert Model);
William Thompson & Joseph Hickey, 2005
Upper class (1%)Top-level executives, celebrities, heirs; income of $500,000+ common. Ivy league education common.
Upper middle class/Professional Class (15%)
Highly-educated (often with graduate degrees) professionals & managers with household incomes varying from the high 5-figure range to commonly above $100,000.
Lower middle class (32%)
Semi-professionals and craftsmen with some work autonomy; household incomes commonly range from $35,000 to $75,000. Typically, some college education.
Working class (32%)
Clerical, pink- and blue-collar workers with often low job security; common household incomes range from $16,000 to $30,000. High school education.
Lower class (ca. 14–20%)
Those who occupy poorly-paid positions or rely on government transfers. Some high school education.
Those who occupy poorly-paid positions or rely on government transfers. Some high school education.
Thompson, W. & Hickey, J. (2005). Society in Focus. Boston, MA: Pearson, Allyn & Bacon; Leonard
Beeghley, 2004
The super-rich (0.9%)
Multi-millionaires whose incomes commonly exceed $350,000; includes celebrities and powerful executives/politicians. Ivy League education common.
The rich (5%)
Households with net worth of $1 million or more; largely in the form of home equity. Generally have college degrees.
Middle class (plurality/majority?; ca. 46%)
College-educated workers with considerably higher-than-average incomes and compensation; a man making $57,000 and a woman making $40,000 may be typical.
Multi-millionaires whose incomes commonly exceed $350,000; includes celebrities and powerful executives/politicians. Ivy League education common.
The rich (5%)
Households with net worth of $1 million or more; largely in the form of home equity. Generally have college degrees.
Middle class (plurality/majority?; ca. 46%)
College-educated workers with considerably higher-than-average incomes and compensation; a man making $57,000 and a woman making $40,000 may be typical.
Working class (ca. 40–45%)
Blue-collar workers and those whose jobs are highly routinized with low economic security; a man making $40,000 and a woman making $26,000 may be typical. High school education.
The poor (ca. 12%)
Those living below the poverty line with limited to no participation in the labor force; a household income of $18,000 may be typical. Some high school education.
Beeghley, L. (2004). The Structure of Social Stratification in the United States. Boston, MA: Pearson, Allyn & Bacon.
Households or extended family holdings with net worth of over $20 million.These elites have access to diversified wealth and the sophisticated financial technology necessary to manage it. Rather than building businesses, their focus is how to increase the value of their assets, and obtain control of the assets through business deals, ties to government, or other influence. The Kleptocratic class focuses on networking with other in their class, in order to identify, arrange and execute the business dealings that most effectively grow their wealth. Financial mechanisms include stock manipulation, buybacks, acquisitions, speculation, takeovers, mergers, privatization, tax avoidance and offshore banking. Will often have exclusive use of a private jet and multiple vehicles. Often collect art or valuable vehicles as status symbols. Usually own multiple homes in multiple countries. Incomes range from $10 million per year upwards, and can vary dramatically from year to year as their investments shift in value.
Super Rich(0.09%)
Households or extended family holdings with net worth of over $20 - 100 million. These elites have usually business founders, CEOs of large companies, work in finance or technology. They may also have inherited substantial family fortunes. May have exclusive use of a private company jet if there are the CEO. Usually own multiple homes or own multiple investment properties. Investments are diversified mixture of property and company stock. Incomes range from $1 - 10 million per year, and can vary dramatically from year to year as their investments shift in value.
Investor Class 0.9%
Households with net worth of $10 million - $20 million. The investor class gains most of their income from investment returns and equity in businesses rather than salary as an employee. They may not work in the traditional sense or receive a salary. They include CEO of very large organizations, public figures with ownership of a successful personal brand, founders of companies. In the finance and technology industries, they may be still employees. Usually own at least two larger homes, with one being in a international resort, tax haven or location chosen for recreation or culture. Typically have multiple vehicles provided by their corporation or company and may have private jet sharing or smaller jet. Household incomes are typically $400,000 - $1,000,000 per year.
Rich 9%
Households with net worth of around $1 million - 10 million. Typically graduate salaried professionals who have increased their net worth through stock options, home equity, or inheritance. Typically management level position in large corporations, founder/CEO at a smaller corporations or owner of a private company. They are often residential estate investors for tax advantages and equity growth. Typically own one larger family home and a often a smaller second vacation home or apartment in a resort or recreation location within driving distance of the primary home. They may lease multiple new cars on a regular basis or have at least one vehicle provided by their company. Household incomes from $200,000 - $400,000 per year.
Upper middle class(10%)
Households with net worth from $500,000 to $1 million. Highly-educated (often with graduate degrees), most commonly salaried professionals and middle management with large work autonomy. Their net worth is typically home equity and retirement funds such as 401Ks. Those with real estate investments and prudent financial management or long continuous employment may move into the Rich class over time, although this sort of moving is decreasing. May lease new vehicles or finance second hand late model vehicles. May own a timeshare or small vacation home or cottage. Household incomes range from $100,000 - $200,000.
Lower middle class (30%)
Households with net worth from $100,000 to $500,000. Semi-professionals, clerical and skilled trades with a roughly average standard of living. Most have some college education and are white-collar. Many are home owners but may struggle with payments and lose their equity due to foreclosure due to job loss or other changes in circumstances, even slipping downwards to the working class as a result. Usually finance older model vehicles second hand or buy inexpensive second hand vehicles privately. Household incomes range from $50,000 - $100,000.
Working class (30%)
Households with net worth from $20,000 to $100,000. Clerical and mostly blue-collar workers whose work is highly routinized. Standard of living varies depending on number of income earners, but is commonly just adequate. High school education. When they own homes, they are in low income and undesirable areas where low economic status predominates, with high risk of loss to foreclosure. Vehicles are either low cost and brought privately, or older vehicles that they maintain themselves using skills found in their network of friends. Homes are often poorly maintained due to lack of income for basic maintenance. Household income from $25,000 - $75,000
Working poor (13%)
Net worth from zero to $20,000. Service, low-rung clerical and some blue-collar workers. High economic insecurity and risk of poverty. Some high school education. Rarely own their home but may do if they in a area with low or depressed real estate values, with constant risk of foreclosure due to wage insecurity. Sometimes own vehicles which are at risk of loss due to lack of income for maintenance, payments or insurance. Loss of homes to foreclosure frequent due to wage insecurity. lack of cashflow and predatory banking practices. Household income generally under $25,000
Underclass (12%)
Usually zero or negative net worth. Those with limited or no participation in the labor force. Reliant on government transfers. Some high school education. Income generally under $10,000 and may rely on non-income charity for basic needs. i.e. soup kitchens or homeless shelters. Do not own the residence they live in. Unlikely to own a vehicle, if they do, it is likely to be unregistered or uninsured.
Hill, 2016
Kleptocratic Class and Billionaires (0.01%)Households or extended family holdings with net worth of over $20 million.These elites have access to diversified wealth and the sophisticated financial technology necessary to manage it. Rather than building businesses, their focus is how to increase the value of their assets, and obtain control of the assets through business deals, ties to government, or other influence. The Kleptocratic class focuses on networking with other in their class, in order to identify, arrange and execute the business dealings that most effectively grow their wealth. Financial mechanisms include stock manipulation, buybacks, acquisitions, speculation, takeovers, mergers, privatization, tax avoidance and offshore banking. Will often have exclusive use of a private jet and multiple vehicles. Often collect art or valuable vehicles as status symbols. Usually own multiple homes in multiple countries. Incomes range from $10 million per year upwards, and can vary dramatically from year to year as their investments shift in value.
Super Rich(0.09%)
Households or extended family holdings with net worth of over $20 - 100 million. These elites have usually business founders, CEOs of large companies, work in finance or technology. They may also have inherited substantial family fortunes. May have exclusive use of a private company jet if there are the CEO. Usually own multiple homes or own multiple investment properties. Investments are diversified mixture of property and company stock. Incomes range from $1 - 10 million per year, and can vary dramatically from year to year as their investments shift in value.
Investor Class 0.9%
Households with net worth of $10 million - $20 million. The investor class gains most of their income from investment returns and equity in businesses rather than salary as an employee. They may not work in the traditional sense or receive a salary. They include CEO of very large organizations, public figures with ownership of a successful personal brand, founders of companies. In the finance and technology industries, they may be still employees. Usually own at least two larger homes, with one being in a international resort, tax haven or location chosen for recreation or culture. Typically have multiple vehicles provided by their corporation or company and may have private jet sharing or smaller jet. Household incomes are typically $400,000 - $1,000,000 per year.
Rich 9%
Households with net worth of around $1 million - 10 million. Typically graduate salaried professionals who have increased their net worth through stock options, home equity, or inheritance. Typically management level position in large corporations, founder/CEO at a smaller corporations or owner of a private company. They are often residential estate investors for tax advantages and equity growth. Typically own one larger family home and a often a smaller second vacation home or apartment in a resort or recreation location within driving distance of the primary home. They may lease multiple new cars on a regular basis or have at least one vehicle provided by their company. Household incomes from $200,000 - $400,000 per year.
Upper middle class(10%)
Households with net worth from $500,000 to $1 million. Highly-educated (often with graduate degrees), most commonly salaried professionals and middle management with large work autonomy. Their net worth is typically home equity and retirement funds such as 401Ks. Those with real estate investments and prudent financial management or long continuous employment may move into the Rich class over time, although this sort of moving is decreasing. May lease new vehicles or finance second hand late model vehicles. May own a timeshare or small vacation home or cottage. Household incomes range from $100,000 - $200,000.
Lower middle class (30%)
Households with net worth from $100,000 to $500,000. Semi-professionals, clerical and skilled trades with a roughly average standard of living. Most have some college education and are white-collar. Many are home owners but may struggle with payments and lose their equity due to foreclosure due to job loss or other changes in circumstances, even slipping downwards to the working class as a result. Usually finance older model vehicles second hand or buy inexpensive second hand vehicles privately. Household incomes range from $50,000 - $100,000.
Working class (30%)
Households with net worth from $20,000 to $100,000. Clerical and mostly blue-collar workers whose work is highly routinized. Standard of living varies depending on number of income earners, but is commonly just adequate. High school education. When they own homes, they are in low income and undesirable areas where low economic status predominates, with high risk of loss to foreclosure. Vehicles are either low cost and brought privately, or older vehicles that they maintain themselves using skills found in their network of friends. Homes are often poorly maintained due to lack of income for basic maintenance. Household income from $25,000 - $75,000
Working poor (13%)
Net worth from zero to $20,000. Service, low-rung clerical and some blue-collar workers. High economic insecurity and risk of poverty. Some high school education. Rarely own their home but may do if they in a area with low or depressed real estate values, with constant risk of foreclosure due to wage insecurity. Sometimes own vehicles which are at risk of loss due to lack of income for maintenance, payments or insurance. Loss of homes to foreclosure frequent due to wage insecurity. lack of cashflow and predatory banking practices. Household income generally under $25,000
Underclass (12%)
Usually zero or negative net worth. Those with limited or no participation in the labor force. Reliant on government transfers. Some high school education. Income generally under $10,000 and may rely on non-income charity for basic needs. i.e. soup kitchens or homeless shelters. Do not own the residence they live in. Unlikely to own a vehicle, if they do, it is likely to be unregistered or uninsured.
ESCSC Merge Stock Grant
| ||||||||||||
HPE Equity Plan Grant Date December 2018
454 shares HPE @ ~$23 = $10,500 less taxes
Number of HPE shares will stay the same, but value will go down with each spin-merge.
TD Ameritrade 168 shares HPE @ ~23 in TD Ameritrade = $4,000 ESCSC Spinmerge Grant Date ??? 454 shares ESCSC @ $x.xx Amount and price of shares is not set, so there is no way to tell if the overall value of the grant will increase or decrease. Whether Grant Date is pulled forward is not clear.
TD Ameritrade
168 shares HPE @ ~$x.xx in TD Ameritrade = $2,000
168 shares ESCSC @ ~$x.xx in TD Ameritrade = $2,000
| ||||||||||||
NeuroGoal Process on Exponentially Expanding Wealth
Exponentially Expanding Wealth
My net worth expands exponentially.
Goal Process
Okay, we’re going to begin. You may keep your eyes open or closed as you like.
Are you nervous or excited about doing this process?
Proceed with Neutralize Protocol
How do you feel?
Proceed with Neutralize Protocol
Do you have any doubts about running this process correctly?
Proceed with Neutralize Protocol
Now, put your attention on a goal you wish to achieve.
Do you have any expectations for the results of this process relative to the goal?
Proceed with Neutralize Protocol
Is there something about this goal you think you may never be handled?
Proceed with Neutralize Protocol
Is there a part of this goal that you can’t imagine coming about?
Proceed with Neutralize Protocol
Are you creating an idea that you’ve failed in this goal before?
Proceed with Neutralize Protocol
Are you creating an idea you will fail in this goal in the future
Proceed with Neutralize Protocol
Regarding you goal, are you creating a lack of physical ability?
Proceed with Neutralize Protocol
Regarding your goal, are you creating a emotional barrier or fear?
Proceed with Neutralize Protocol
Regarding your goal, are you creating a lack of knowledge?
Proceed with Neutralize Protocol
Regarding your goal are you creating a lack of spiritual presence?
Proceed with Neutralize Protocol
Create an impression of yourself when you first decided upon your goal.
Now create an impression of every obstacle you have so far overcome, since deciding on your goal.
Now create an impression of the person who you think you need to be, to achieve the goal.
Experience what that person is doing as they achieve their goal.
Experience what that person is seeing as they achieve their goal.
Experience what that person is hearing as they achieve their goal.
Experience who that person is with as they achieve their goal.
Experience that person receiving or spending money if required to achieve their goal.
Experience that person thinking the thoughts required to achieve their goal.
Experience that person feeling the emotions required to achieve their goal.
Proceed with
Experience that person feeling the frustration required to achieve their goal.
Experience that person feeling elation at the achievement of their goal.
Now totally be the person who is experiencing all of those things.
Proceed with NeuroYou Protocol
Insights
Created my new identity as the person that will manifest this vision and live my wealth building creed:
Insights
Created my new identity as the person that will manifest this vision and live my wealth building creed:
- I will build wealth continuously, safely and exponentially
- I will build wealth by placing integrity and ethics first at all times.
- Building wealth allows me to become more of who I want to be.
- I qualify for amazing opportunities, happily receive money, gratefully take profits, and accumulate wealth rapidly.
Retirement Planning
OK, I admit I got a late start with retirement funding.
Sylvia and I have now got a net worth of $700,000. This year alone, my net worth increased over $250,000.
My current planning and action was all done in order to create and maintain net worth.
However, while not letting my eye off the ball of continuously increasing net worth, I need to start creating a similar mental model of how that net worth will translate into monthly income at retirement.
Social Security - Peter $2500 a month
Social Security - Sylvia $1500 a month
Lets assume I could create ten investment properties that were paid off by the time I retire at 67.
How will I create ten investment properties
Eden2 - $200,000K US
Grimlinghauserstraase - $500,000K US
$700,000k
75% leverage = $2.8 million in real estate
= About $10,000 in cashflow a month
The real gain is in capital gains. Which means timing of when to sell and buy, if you assume the market is cyclic.
It is 2017 now. I am 67 in 2037. That's twenty years
So properties have to be paid off in less than a 30 year mortgage.
A large chunk of the benefit of owning investment property is the fact that the interest is tax deductible. That acts as a disincentive to pay them off. But, if the goal is to have them paid off and creating cash flow, I would have to pay off significant amounts of additional principal, early in the
So, is it better to pay them off, or use additional capital to buy more properties?
The ways you make money in investment property are:
1. Capital gains
2. Depreciation deduction
3. Mortgage interest is a business cost.
Buying more properties::
1. Increases opportunity for capital appreciation
2. Increases depreciation to offset income
3. Increases cash flow
4. Creates additional complexity and cost
5. Increases potential risk
Paying down existing properties:
1. Increases equity in the property being paid off
2. Decreases availability of free capital (increases cash flow risk)
3. Decreases overall risk by having decreasing leverage.
Net worth impact is the same for additional strategy.
What is my free cash flow income target at 67.
To maximise our social security benefits we should not start receiving social security until age 67.
Target retirement income is $10,000 a month for 20 years, then assume some kind of managed care for 10 years.
I need concrete income calculations and draw down calculations that answer some of the following questions.
- How much will my 401 K type savings last.
I need to understand better the cash flow that a property investment portfolio could generate, and how to use that cash to minimize tax and maximise income.
Social security makes up 90% of their income from 35 percent of retirees
Social security makes up 50% of the income of 60 percent of retirees
Monitor the gains I make from my 401K to see how much I would make trading mutual funds in my 401K.
What is the balance I would need in my 401k to be able to make income from regular trading and from ownership of dividend and capital gains distributions.
If I had $1,000,000 in my 401K, and was trading $100,000 (10% of the total balance) in each trade:
- A 3% gain would be $3000 in profit. After tax that would be $2500
It's realistic that I could make 2-3 3% trades each month. That would be between $5000 and $10,000 per month, or $3750 and $7500 after tax.
The target is to create a clear plan for $10,000 after tax income per month
See which funds can be used to provide monthly income.
Sylvia and I have now got a net worth of $700,000. This year alone, my net worth increased over $250,000.
My current planning and action was all done in order to create and maintain net worth.
However, while not letting my eye off the ball of continuously increasing net worth, I need to start creating a similar mental model of how that net worth will translate into monthly income at retirement.
Social Security - Peter $2500 a month
Social Security - Sylvia $1500 a month
Lets assume I could create ten investment properties that were paid off by the time I retire at 67.
How will I create ten investment properties
Eden2 - $200,000K US
Grimlinghauserstraase - $500,000K US
$700,000k
75% leverage = $2.8 million in real estate
= About $10,000 in cashflow a month
The real gain is in capital gains. Which means timing of when to sell and buy, if you assume the market is cyclic.
It is 2017 now. I am 67 in 2037. That's twenty years
So properties have to be paid off in less than a 30 year mortgage.
A large chunk of the benefit of owning investment property is the fact that the interest is tax deductible. That acts as a disincentive to pay them off. But, if the goal is to have them paid off and creating cash flow, I would have to pay off significant amounts of additional principal, early in the
So, is it better to pay them off, or use additional capital to buy more properties?
The ways you make money in investment property are:
1. Capital gains
2. Depreciation deduction
3. Mortgage interest is a business cost.
Buying more properties::
1. Increases opportunity for capital appreciation
2. Increases depreciation to offset income
3. Increases cash flow
4. Creates additional complexity and cost
5. Increases potential risk
Paying down existing properties:
1. Increases equity in the property being paid off
2. Decreases availability of free capital (increases cash flow risk)
3. Decreases overall risk by having decreasing leverage.
Net worth impact is the same for additional strategy.
What is my free cash flow income target at 67.
To maximise our social security benefits we should not start receiving social security until age 67.
Target retirement income is $10,000 a month for 20 years, then assume some kind of managed care for 10 years.
I need concrete income calculations and draw down calculations that answer some of the following questions.
- How much will my 401 K type savings last.
Social security makes up 90% of their income from 35 percent of retirees
Social security makes up 50% of the income of 60 percent of retirees
Monitor the gains I make from my 401K to see how much I would make trading mutual funds in my 401K.
What is the balance I would need in my 401k to be able to make income from regular trading and from ownership of dividend and capital gains distributions.
If I had $1,000,000 in my 401K, and was trading $100,000 (10% of the total balance) in each trade:
- A 3% gain would be $3000 in profit. After tax that would be $2500
It's realistic that I could make 2-3 3% trades each month. That would be between $5000 and $10,000 per month, or $3750 and $7500 after tax.
The target is to create a clear plan for $10,000 after tax income per month
See which funds can be used to provide monthly income.
EDS Retirement Rollover into IRA
Significant financial event today. The EDS retirement plan from my time as an EDS employee was paid out as a tax free rollover into my retirement savings account.
The payout far exceeded the $14,537 cash value which was recorded in the EDS Pension statement, or the the lump-sum payment when the program was announced of $19,074.
The actual payment was $23,999
This amount goes into Rollover IRA which I can manage similar to my brokerage account, or perhaps put in a retirement age based fund.
The payout far exceeded the $14,537 cash value which was recorded in the EDS Pension statement, or the the lump-sum payment when the program was announced of $19,074.
The actual payment was $23,999
This amount goes into Rollover IRA which I can manage similar to my brokerage account, or perhaps put in a retirement age based fund.
Sylvia Finances Monthly Tasks
1. Open file on Peter's OneDrive > Sylvia > Finances > 2016 > Sylvia Finances 2016.xlsx
2. Login to Chase
3. Download statements for following accounts. Save the statements in the Finances > 2016 folder
- Checking 9727
- Credit Card 9294
- Credit Card 3837
- Business Saving 5976
4. Update appropriate sheet in Excel to paste the transaction data
5. Use formulas to copy the monthly data from each account to the Income and Expenses sheet
6. Review the profit and loss for the month on the Business Summary sheet
2. Login to Chase
3. Download statements for following accounts. Save the statements in the Finances > 2016 folder
- Checking 9727
- Credit Card 9294
- Credit Card 3837
- Business Saving 5976
4. Update appropriate sheet in Excel to paste the transaction data
5. Use formulas to copy the monthly data from each account to the Income and Expenses sheet
6. Review the profit and loss for the month on the Business Summary sheet
Stock Trading Reset
Shocking realization today:
I created several new calculations on my trading spreadsheet.
The first column was a cumulative profit per stock figure, where I could see how much profit I made over all the trades done for a particular stock
The second column was a running total of the long term profit over all the trades I had recorded.
The shocking thing was that basically my profits were cancelled out by my losses. This implies that effectively I would have done much better simply sticking my money in a monthly income fund like Realty Income, and collecting a small dividend every month.
In fact, if I had put all my available investment dollars in Realty Income in 2008, I would have probably made 200-300% gain.
In my 401K, I've been more successful at training myself to demand that my account balance increase every month
Here is a strategy idea for my stock trading. What if at the end of every month, if I haven't increased my balance, I sell any losing stocks in order to reduce further losses?
If my goal is to see my monthly trading account balance increase every month, how would that change my choice of investments?
It has worked well for my 401K. This is a a kind of trigger approach, where I make conservative investments based on my RSI and EMA trading patterns, then take gains in such a way that my account balance keeps increasing every month. If this means I gravitate to income type investments, this is probably a good thing.
I created several new calculations on my trading spreadsheet.
The first column was a cumulative profit per stock figure, where I could see how much profit I made over all the trades done for a particular stock
The second column was a running total of the long term profit over all the trades I had recorded.
The shocking thing was that basically my profits were cancelled out by my losses. This implies that effectively I would have done much better simply sticking my money in a monthly income fund like Realty Income, and collecting a small dividend every month.
In fact, if I had put all my available investment dollars in Realty Income in 2008, I would have probably made 200-300% gain.
In my 401K, I've been more successful at training myself to demand that my account balance increase every month
Here is a strategy idea for my stock trading. What if at the end of every month, if I haven't increased my balance, I sell any losing stocks in order to reduce further losses?
If my goal is to see my monthly trading account balance increase every month, how would that change my choice of investments?
It has worked well for my 401K. This is a a kind of trigger approach, where I make conservative investments based on my RSI and EMA trading patterns, then take gains in such a way that my account balance keeps increasing every month. If this means I gravitate to income type investments, this is probably a good thing.
Monthly Tasks
Eden2
In the first week of the month
1. Login to Microsoft Live email and search for emails from "Tiri"
2. Download Crockers rental statement for the previous month from the attachment in the email
2. Download Crockers rental statement for the previous month from the attachment in the email
2. Update Eden2 Income and Expenses sheet with actual amounts from the rental statement
3. Login to Bank Direct and view the last months transactions
4. Update Eden2 Income and Expenses sheet with actual transaction amounts from Bank Direct
2016 Recession Strategy
1. My open positions are showing significant losses. My decision is to treat these all as long term positions. I am likely to have to wait 2-3 years for these to show profits. The existing positions are well diversified already, so can be expected to vary considerably. Based on the capital gains from 2015, I could also expect 2-3% return via capital gains.
2. Reinvest within available capital in my brokerage fund using smaller amounts. I have approx $10,000 uninvested. Split that between five funds when you think the market is near the bottom.
3. Dollar cost average into an index fund using my fortnightly contributions. This should smooth out some of the volatility.
5. Increase my savings rate based on my payrise. From 6% to 8%
2. Reinvest within available capital in my brokerage fund using smaller amounts. I have approx $10,000 uninvested. Split that between five funds when you think the market is near the bottom.
3. Dollar cost average into an index fund using my fortnightly contributions. This should smooth out some of the volatility.
5. Increase my savings rate based on my payrise. From 6% to 8%
Mallorca Modern Update
What Progress Have I made this month
- Researched and purchased Chief Architect Home Designer software package
- This package will enable me to visualize my ideas and access my
Thinking and observations of the market
- Trying to get my head around the exact market niche of the north San Diego county area
- A 1900 sq foot house in Encinitas is worth over $1 million, yet values here in north San Diego are still barely moving
- My designs with
Need to start to get budget clarity around how much it costs to build my Mallorca Modern homes
- Researched and purchased Chief Architect Home Designer software package
- This package will enable me to visualize my ideas and access my
Thinking and observations of the market
- Trying to get my head around the exact market niche of the north San Diego county area
- A 1900 sq foot house in Encinitas is worth over $1 million, yet values here in north San Diego are still barely moving
- My designs with
Need to start to get budget clarity around how much it costs to build my Mallorca Modern homes
Horrific January
What a horrible three weeks this has been.
On top of all the losses from 2015, global markets dived in January by nearly 10%.
My 401K saw all my contributions from the entire 2015 turn into losses. A massive sea of red in my account that will take all of 2016 to recover.
These lurching swings eat away at my confidence daily, leading me to feel exhausted and hopeless. The horror of the presidential election, the sexual abuse in Cologne, it's just been a terrible start to 2015 from every respect. It feels like all good intentions of 2015 are being attacked by hideous people around the world. Trump, Palin, moronic Tea Party Republicans, sexually primative Syrian refugees, the Koch brothers. It's all just disgusting, like all the awful energies of the world are just being fueled by some awful destructive energy right now.
Even my garden seems to be rebelling against me, with a huge die off of my beautiful apintinea getting worse and covering the ground in rotting vegetation.
Sylvia had to borrow money just before the end of the year just to make her credit card payments and avoid huge fees. She used all the cash I received from the BMW repair and her parents gifts to me.
I feel sucked dry by the constant demands of my family, the inability of my wife and kids to help sufficiently around the house, and the uncontrolled nature of the assets that underpin our net worth. It makes the future seem just depressing and hopeless.
I did some great work during the holidays redesigning my financial independence plan, only to see all that energy destroyed by the markets. Completely depressing.
On top of all the losses from 2015, global markets dived in January by nearly 10%.
My 401K saw all my contributions from the entire 2015 turn into losses. A massive sea of red in my account that will take all of 2016 to recover.
These lurching swings eat away at my confidence daily, leading me to feel exhausted and hopeless. The horror of the presidential election, the sexual abuse in Cologne, it's just been a terrible start to 2015 from every respect. It feels like all good intentions of 2015 are being attacked by hideous people around the world. Trump, Palin, moronic Tea Party Republicans, sexually primative Syrian refugees, the Koch brothers. It's all just disgusting, like all the awful energies of the world are just being fueled by some awful destructive energy right now.
Even my garden seems to be rebelling against me, with a huge die off of my beautiful apintinea getting worse and covering the ground in rotting vegetation.
Sylvia had to borrow money just before the end of the year just to make her credit card payments and avoid huge fees. She used all the cash I received from the BMW repair and her parents gifts to me.
I feel sucked dry by the constant demands of my family, the inability of my wife and kids to help sufficiently around the house, and the uncontrolled nature of the assets that underpin our net worth. It makes the future seem just depressing and hopeless.
I did some great work during the holidays redesigning my financial independence plan, only to see all that energy destroyed by the markets. Completely depressing.
Rainwater Harvesting
http://www.csemag.com/single-article/rainwater-harvesting-system-design/1cb44b02df740b41b87b97144e75bb61.html
Money - Master the Game
Notes from Money Master the Game by Tony Robbins
401K - Investigate Roth IRA
Pay attention to fees
Index Funds
401K - Investigate Roth IRA
Pay attention to fees
Index Funds
Investment Property Goal Process
Investment Property Goal
- Buy 8 investment properties using the proceeds from Eden2
Goal Process
Okay, we’re going to begin. You may keep your eyes open or closed as you like.
Are you nervous or excited about doing this process?
Proceed with Neutralize Protocol
How do you feel?
Proceed with Neutralize Protocol
Do you have any doubts about running this process correctly?
Proceed with Neutralize Protocol
Now, put your attention on a goal you wish to achieve.
Do you have any expectations for the results of this process relative to the goal?
Proceed with Neutralize Protocol
Is there something about this goal you think you may never be handled?
Proceed with Neutralize Protocol
Is there a part of this goal that you can’t imagine coming about?
Proceed with Neutralize Protocol
Are you creating an idea that you’ve failed in this goal before?
Proceed with Neutralize Protocol
Are you creating an idea you will fail in this goal in the future
Proceed with Neutralize Protocol
Regarding you goal, are you creating a lack of physical ability?
Proceed with Neutralize Protocol
Regarding your goal, are you creating a emotional barrier or fear?
Proceed with Neutralize Protocol
Regarding your goal, are you creating a lack of knowledge?
Proceed with Neutralize Protocol
Regarding your goal are you creating a lack of spiritual presence?
Proceed with Neutralize Protocol
Create an impression of yourself when you first decided upon your goal.
Now create an impression of every obstacle you have so far overcome, since deciding on your goal.
Now create an impression of the person who you think you need to be, to achieve the goal.
Experience what that person is doing as they achieve their goal.
Experience what that person is seeing as they achieve their goal.
Experience what that person is hearing as they achieve their goal.
Experience who that person is with as they achieve their goal.
Experience that person receiving or spending money if required to achieve their goal.
Experience that person thinking the thoughts required to achieve their goal.
Experience that person feeling the emotions required to achieve their goal.
Proceed with
Experience that person feeling the frustration required to achieve their goal.
Experience that person feeling elation at the achievement of their goal.
Now totally be the person who is experiencing all of those things.
Proceed with NeuroYou Protocol
My Wealth Building Creed
My Wealth Building Creed
- I will build wealth continuously, exponentially and safely.
- I will build wealth by placing integrity and ethics first at all times.
- Building wealth allows me to become more of who I want to be.
- I qualify for amazing income and wealth building opportunities, happily receive money, gratefully take profits, and accumulate wealth exponentially.
401K Trading 2016 - Goal Process
401K Trading 2016
- Strictly follow 20/80 Rule: Buy only at RSI 20 and below, sell only at RSI 80 and above
- If trade is over 60 days and profit is minimum, sell at any profit.
- Use tracking spreadsheet
- Check prices every day
- Maximise capital utilization by finding additional diversified funds
Goal Process
Okay, we’re going to begin. You may keep your eyes open or closed as you like.
Are you nervous or excited about doing this process?
Proceed with Neutralize Protocol
How do you feel?
Proceed with Neutralize Protocol
Do you have any doubts about running this process correctly?
Proceed with Neutralize Protocol
Now, put your attention on a goal you wish to achieve.
Do you have any expectations for the results of this process relative to the goal?
Proceed with Neutralize Protocol
Is there something about this goal you think you may never be handled?
Proceed with Neutralize Protocol
Is there a part of this goal that you can’t imagine coming about?
Proceed with Neutralize Protocol
Are you creating an idea that you’ve failed in this goal before?
Proceed with Neutralize Protocol
Are you creating an idea you will fail in this goal in the future
Proceed with Neutralize Protocol
Regarding you goal, are you creating a lack of physical ability?
Proceed with Neutralize Protocol
Regarding your goal, are you creating a emotional barrier or fear?
Proceed with Neutralize Protocol
Regarding your goal, are you creating a lack of knowledge?
Proceed with Neutralize Protocol
Regarding your goal are you creating a lack of spiritual presence?
Proceed with Neutralize Protocol
Create an impression of yourself when you first decided upon your goal.
Proceed with Neuro Future Protocol
Now create an impression of every obstacle you have so far overcome, since deciding on your goal.
Proceed with
Now create an impression of the person who you think you need to be, to achieve the goal.
Proceed with
Experience what that person is doing as they achieve their goal.
Proceed with
Experience what that person is seeing as they achieve their goal.
Proceed with
Experience what that person is hearing as they achieve their goal.
Proceed with
Experience who that person is with as they achieve their goal.
Proceed with
Experience that person receiving or spending money if required to achieve their goal.
Proceed with
Experience that person thinking the thoughts required to achieve their goal.
Experience that person feeling the emotions required to achieve their goal.
Proceed with
Experience that person feeling the frustration required to achieve their goal.
Experience that person felling elation at the achievement of their goal.
Now totally be the person who is experiencing all of those things.
Proceed with NeuroYou Protocol
Insights
Is 100% a year possible?
Visualized making money in my 401K asmagic. I spent a few minutes each day looking at brightly colored charts and spreadsheets, and as if by magic there is hundreds and sometimes thousands of dollars magically appearing in my account each month.
New paradigm: Money is magic, and I am a Wizard
Subscribe to:
Posts (Atom)