The Race Against Time...Help! (Age 39)

Discussion in 'Investing' started by Bret Haskers, Dec 22, 2020.

  1. Bret Haskers

    Bret Haskers New Member

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    Greetings to all... I am a 39-year old male living in Colorado that is new to investing and just found this message board. I am looking for advice/ideas on how to improve my financial situation, particularly going into the future.

    Background: I am not college educated. I did briefly attend junior college 20 years ago, but did not obtain a degree.I come from a family of 7 children, and Mom was a homemaker that never worked a job. There was zero future planning during childhood on my parents part, and zero money for college.

    The lack of college education has wrought what I feel is my main problem: not having a decent paying job. I live in a somewhat isolated, smaller community (population around 20,000), and decent jobs are difficult to come by. The closest large population center to me is over 3 hours away, but I chose to live here for personal reasons, and it is an extremely beautiful area.

    Currently, I make $15/hour and my rent/bills are around $800 a month. One positive note, is that I have zero college loan debt or any other type of debt for that matter. You can do the math on how much I make a year. It's not much.

    I have no wife or children, and I am not paying any extra money on something like child support, etc. I own two vehicles outright, and I have all my expenses nearly cut to the bone. Cell phone bill is $35/month. I do not eat out, or party, or go to bars/clubs or the movies.... ever, for like 10 years. I'm not sure how I could possibly cut down on my expenses. I do not have medical insurance, so that doesn't come out of my paycheck either.

    In the summer of 2019, I suffered a horrific work-related accident (working at a railroad) that took out my left foot pretty bad. I am now in constant mild to more intense pain. So, I now work as a delivery driver to keep off my feet as much as possible. The accident was a real wake-up call, to someone who has always had physical jobs for 25 years. I am now very physically limited in this respect. This very much limits what types of jobs I can/could do in the area in which I live.

    In August of 2020, at the prompting of a family member, I signed up for a Robinhood account. I started out with $300. In the roughly 150 days since, I have been able to squirrel away around $6,700... of which $2,000 is clear profit.

    In the portfolio, I have gone with about 20% ETF's, 30% stocks, and 50% crypto. I have no idea what I am doing, and mostly attribute my $2,000 gain to the idea of it being easy to make money in a bull market cycle. My Robinhood portfolio has honestly been one of the only bright spots of 2020, and it has helped keep me going.

    So, to conclude, is there anything I can do to make sure I don't end up homeless in my 60's, can I possibly ever retire? Is there anything extra I can do to expedite my savings plan?

    I am surrounded by National Forest, so I have toyed with the idea of ditching my apartment and living out of my truck May-October, which is the most you could do around here. I would save about $5,000 extra in 5 months doing this.

    Thanks in advance for any replies, and have a great day!
     
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  2. T0rm3nted

    T0rm3nted Moderator
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    Well that's quite a predicament you're in. Sorry about your foot. Were you fairly compensated for a workplace injury? That should help alleviate much of the financial pain you're in. I would personally have a few recommendations.

    1. Get fairly compensated for your WORKPLACE injury. That should get you some nice money to live off for awhile while looking for work.
    2. Find a trade school in your area. College these days is inferior to a trade school in my opinion - and I'm a college graduate in a white collar job now. The cost of college, with years of paying it off, then usually followed up by a job you are taken advantage of. Go to a trade school, then find a good Union job. They usually pay just as well and better than a lot of white collar jobs, and have far better benefits.
    3. You mention being worried about being homeless, then say you want to live in your truck. Don't do it.
    4. Research stocks. Don't invest half your money in something as volatile as crypto if you have no idea what you're doing. If you're just "winning with dumb luck", just put it in ETF's or safe dividend paying stocks long-term until you know what you're doing.

    This last one may be controversial. You say you have chosen to stay in your area for personal reasons. You're going to have to weigh those against moving somewhere you can find a good job. Where you live now sounds like a low cost-of-living place. Low paying jobs you'll be able to find, and can work them until late in life if you decide to stay there. You'll be comfortable, but you're not going to be retiring early. If you're willing to move, you may find a Union job in like an auto manufacturer, or somewhere like that where you could make up to $30/hr and still find an apartment for the same $800/month. Then you've got a chance. Everyone's life and priorities are different though. Choosing to stay in a small town has benefits (beauty, simpler life, closeness to everything in your area, relaxing), but it also comes with negatives (lack of work, etc.). I'd say it's really up to you to decide what you want to do.

    It sounds like you're already doing ok with what you've got going. You'll be fine and continue an extremely slow grind up of cash. You're responsible with the money you do have and live a "simple" life with low bills and low expenses.

    If the "only thing positive" you have going on for you right now is your investments, you need to be prepared. You could possibly lose it quick. Crypto is EXTREMELY risky, and can disappear virtually overnight. Last time bitcoin nearly hit 20K, it was down to 6K just a few weeks later. Are you mentally prepared for 50% of your portfolio to drop down to a 3rd of it's value? That can happen when you gamble on extreme volatility.
     
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  3. WXYZ

    WXYZ Well-Known Member

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    SO.....if I am reading your post right in 150 days you were able to save $4700? I am taking your $6700 and subtracting the $2000 profit. Something must be off with these figures....but if they are accurate.....a 39 year old saving that much and simply putting the funds in the SP500 will be fine when they reach retirement. If you can save and invest $4700 in 150 days ....you should be able to save $9000 in a year. If these numbers are accurate......If it was me I would invest up to the max in a ROTH IRA in a SP500 Index and the rest in a regular brokerage account in a SP500 Index fund.

    I suspect there is something wrong with your numbers.....but I hope not. I am NOT being critical....just trying to clarify how much you are able to save in a year....you are doing the right thing to think about your future. If you are saving that much on your income...you are EXCEPTIONAL.....and if you can continue to do so over 20-30 years you will be just fine.
     
    #3 WXYZ, Dec 22, 2020
    Last edited: Dec 22, 2020
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  4. Bret Haskers

    Bret Haskers New Member

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    Thanks for the reply. Yes, I was. Sadly, there's not much that can be done about it. It may eventually heal itself into a better state a number of years. I was in therapy for several months, and now I just do home therapy.



    I sure wish I had done this a decade ago. The closest school to me would be about an hour away, for a 2 hour commute each time. I might have to look into it. There is gas & oil here, although it has been in decline since around 2012-2014ish.


    I wasn't intending for crypto to take over my portfolio like that, it sort of just happened because Bitcoin was skyrocketing the last 90 days. I'm up around $1,100 on it, with only $1,600 invested. I'm pretty good at not having an emotional attachment to the investment, so if it starts to slide badly, I will dump it fast without too much loss. That's my exit plan anyhow, but I totally see what your getting at. And yes, it does bother me to an extent.


    I did chose initially, but after my accident it has forced me to seriously re-consider my life. I moved here in 2013, and my life and goals were completely different back then.
    I do not wish to leave the Western U.S., or move to too large of a city, or move too far north. The only place I have been able to come up with would be the St. George, Utah area. There are more jobs, but the cost of living is cheap, and the Mormons seem to know how to run businesses effectively.
    Where I am at now with a new job and everything else, I wouldn't really be able to move for another 2 years.


    Yes. Like I said, I had a serious wake-up call the last 18 months or so. I suppose I am just panicking a bit, but I wanted to see if there were any effective ways to speed up my savings plan.


    I
    I do realize this. I guess I have sort of been going for the high-risk/high-reward strategy. But I think you are right and I should dial it back a bit.
    I have things like ARKK, HACK, NIO, LAZR, PBW, etc. Should I put more money into things like that? I'm not a fan of tech stocks generally, so I basically don't own those.
     
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  5. Bret Haskers

    Bret Haskers New Member

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    Yes. I got jump-started by around $1,200 because I used some of the Federal stimulus money to that I had saved up.
    But yes, if I play my cards right, I should normally be able to save around 6-9,000 a year I'd say.
    I actually have a Vanguard account, but I don't have any money in it yet. It might sound strange, but right now I'm just trying to get going for a little bit, and Vanguard just seems to slow to me. I'm making bigger gains now, and yes, speaking gains I know I have to pay capitol gains taxes, but ROTH IRA just looks like slow money to me right now. I do realize how important it is from the tax angle. I'm getting there, it's just going to be a little while longer, and then I'll start concentrating on getting a steady flow into my Vanguard.


    I don't know if I can keep it up each and every year, but the more I save, the more it seems to motivate me to save more. I think I did get a little lucky this year, because of a little extra stimulus money, and the overall bull markets.
     
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  6. Travis Klein

    Travis Klein New Member

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    get your earnings to 30 or 35 an hour, literally spend your whole waking time planning for how to do this and stop with this nonsense crypto or robinhood nonsense. Worry about all that after you solve your main problem.

    You need to find people who are at this level that you want to get to. People without a college degree who are making 30+ an hour with a good skill (they might or might not have learned in trade school)

    Learn from this person and do whatever you have to do to get him to help you. Cut his lawn every week, wash his car, cook him dinner and lunches for however long. Put an ad in the paper looking for this type of person who can help you and guide you. Talk to neighbors, church people.

    You aren't asking people for money just guidance to set you off in the right direction. You will find meet some amazing people if you spend all of your energy on this one thing, and you will learn a ton.

    Don't be surprised in 5 years if you look back wondering how you ever made $15/hour when you make that every 20 minutes now.
     
  7. WXYZ

    WXYZ Well-Known Member

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    Too slow at age 39? NO WAY. You have at least 20-30 years to retirement. The way you get RICH......is slow and steady.....even at age 39. If you save $9000 a year you will be way ahead.....over the long term.....compared to trying to trade stocks and crypto with ZERO experience. EVEN with experience it is just about IMPOSSIBLE for a trader to beat the SP500 over the long term. People that do what you are now doing SEVERELY lag the indexes like the SP500. BUT.....it is your money. You have to be a long term thinker.

    I suggest you read this little article and take the lesson to heart:

    One decade ago, Warren Buffett took a $1 million wager that stashing money in an index fund would make you richer than if you entrusted it with hedge fund managers.

    https://money.cnn.com/2018/02/24/investing/warren-buffett-annual-letter-hedge-fund-bet/index.html

    "He won -- big time -- and in his annual letter on Saturday, the billionaire Chairman and CEO of Berkshire Hathaway (BRKA) Inc. outlined the final tally. He also took a jab at the hedge fund folks at the losing end.

    His pick, the S&P 500 (OEX), gained 125.8% over ten years. The five hedge funds, picked by a firm called Protégé Partners, added an average of about 36%. The names of the funds were not disclosed."

    "Let me emphasize that there was nothing aberrational about stock-market behavior over the ten-year stretch," Buffett wrote in his annual letter. He noted that the S&P 500 performed just as he expected, and "making money in that environment should have been easy" for the hedge fund investors."

    AND

    In fact the hedge fund trader ENDED the bet early since he had NO CHANCE to win.

    Warren Buffett Just Officially Won His Million-Dollar Bet

    https://www.fool.com/investing/2018/01/03/warren-buffett-just-officially-won-his-million-dol.aspx

    "In fact, Seides had already conceded the bet earlier in 2017, due to the huge disparity in performance between his basket of hedge funds and Buffett's S&P 500 index fund. After all, through the end of 2016, the S&P 500 index fund had gained more than 85%, while the average of Seides' five baskets of funds was just 22%. Even the best performer of the five gained just 62.8% -- not one of the five baskets of hedge funds was able to beat a passive S&P 500 index fund.

    Things didn't get any better for the hedge-fund portfolio throughout the rest of 2017. The final results were a 7.1% annualized gain for the S&P 500 index fund (about 99% overall return) versus just 2.2% annualized (about 24% total) for the basket of funds Seides had selected."

    MY QUESTION....which one would you like to be in 20-30 years when you look back on this post? AND.....this bet was against an elite professional trader. YES.....he gave up and CONCEDED even before the end of the ten years.
     
    #7 WXYZ, Dec 22, 2020
    Last edited: Dec 22, 2020
  8. Bret Haskers

    Bret Haskers New Member

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    Thanks for the advice, Travis. I am going to move in this direction.


    They are a little difficult to find around here, but I start searching.
     
  9. Bret Haskers

    Bret Haskers New Member

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    Thanks for the reply. I have been re-working my numbers, and a more realistic savings target per year for me is more likely $3,500-$5,500 a year.
    But at any rate, I am up +43% YTD on my portfolio. I suppose it might be a fluke due to the bull market. Anyhow, I'd like to keep pressing ahead with perhaps a more conservative approach.

    What ETF's or dividend stocks do you like?
     
  10. WXYZ

    WXYZ Well-Known Member

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    WELL.....I dont give specific investing advice. BUT....you could read The Long Term Investor thread and the TomB16 Investing Blog. There are a number of good long term investors on there, my portfolio model is on there, etc, etc. At this point you are just starting out...but with one advantage....you have the ability to save a pretty good amount of money each year to invest. The KEY will be to find what works for you and fits your goals.
     
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  11. TomB16

    TomB16 Well-Known Member

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    For sure. Saving money is addictive.

    When you first start, it's hard to imagine you could get anywhere good in 20 years. The projections don't work. That's how it was for me. It will add up faster than you think, however, if you just keep saving. Save off the top and then learn to live on what's next. When your car breaks down, take the bus for a while. There is always an excuse to spend money and it always seems absolutely critical. Don't allow it.

    Net worth growth is non-linear. That's why it works so well.

    Even if you can only get to $250K in 20 years, you would be OK. Take out the $30K/year, add it to your social security, and move to a more affordable country. You will have a great life. People with one hell of a lot less have retired to an OK life.

    I have to say, T0rm3nted's trade school idea makes a lot of sense to me. That may be the only thing that has more value than saving/investing. It's not that hard to become a refrigeration mechanic. 18 months, get your ticket, and be a solid earner.

    Whatever you do, don't trade. Just buy the S&P 500 with whatever you have and then work on improving your life.
     
    #11 TomB16, Dec 22, 2020
    Last edited: Dec 22, 2020
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  12. TomB16

    TomB16 Well-Known Member

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    Ok. Making money. Couple of ideas.

    If you have the discipline, you can make money by going to tourist heavy locations and working service industries that are not food service. If you were a 20 year old, nubile, girl, I'd say go to Taho, a Colorado ski resort, etc. and wait tables. They can make a ton of money on tips. Men don't do nearly as well, even if they are a GQ model. There are other service industries in these locations, such as HVAC repair, electrical, refrigeration repair, window repair, etc.

    Do something that is repair and maintenance, not construction. Stay away from work that is tied to the economy. If you live in a ski resort in Colorado and repair furnaces, you will be busy when the economy is bad. People need heat, no matter what. Construction is boom and bust.

    I know a glass guy who has done extremely well at a winter resort.

    The thing is, you better have the discipline to save your money instead of spending it on drugs and gambling, both of which are rampant at these locations.

    I know a glass guy who does pretty well. Sure, he doesn't make as much as a top lawyer but he's a glass guy and he has a nice life in a beautiful place.

    Don't panic. You are in a tough spot but you can do this. You come across as someone likely to succeed. Welcome to Stockaholics, Bret.
     
    #12 TomB16, Dec 22, 2020
    Last edited: Dec 22, 2020
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  13. Bret Haskers

    Bret Haskers New Member

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    Thanks for the thoughtful reply, WXYZ. I will certainly look into that in detail and look forward to leaning more!
    Yes, I am blessed in that regard. I have in general tried to always keep my life as simple as possible. And I am fortunate in that I don't have any debts.
    But in the past, I have spent way too much on hobbies, etc. After 2019, I just realized that I have to stop messing around and get serious about the future.
     
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  14. Bret Haskers

    Bret Haskers New Member

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    It sure is!! I never thought that I would actually enjoy this. It certainly isn't what I expected.


    Thanks a million man, this is EXACTLY what I needed to hear! It's like I need to learn to die to myself, and delay all the stupid materialistic reward centers in my brain.


    N
    What are your thoughts on the Dave Ramsey retirement calculator?


    What are your thoughts on South America? I have a friend who moved to Argentina over a decade ago, and he loves it. He's into farming though.


    I
    This has got to be the ticket for me. Thanks for that, brother.


    I haven't traded too crazily in the past 4 months since I got started, but more than you guys would like to see. I'm trying to stabilize things once I get into the new year.
     
  15. Bret Haskers

    Bret Haskers New Member

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    The funny thing is, that's what I sorta did. I worked for a heritage railroad. The benefits were actually really good for where I live. The pay wasn't though. Also, the environment was way too fickle. Things like fire, mudslides, washouts, and then COVID took me out. It might take years for them to get their ridership numbers back.
    My new job now is actually delivering HVAC parts. I'm on the wrong end of things... for now.


    Yep. Been there, done that. I did construction for 3 years in my mid-30's. It just about killed me, and there was absolutely nothing positive about it.


    We have a drug & homeless problem here. We also have a suicide rate that is 3x the national average. Since Colo legalized weed first in 2013, we had a lot of unsavory types move in.


    Thanks a lot, Tom. I really look forward to being here and learning more. I wish I would have found this message board 3-4 months ago. At any rate, I am also glad that it's not a super busy place, I like it that way.
     
  16. WXYZ

    WXYZ Well-Known Member

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    BRET.......you are already a delivery driver. Why not explore other forms of truck driving that pay better than what you are doing. Long, medium, or short haul. Dump truck, etc, etc. It seems to me that your skills and experience would help you.....EASILY and QUICKLY..... land a better paying driving job.
     
    #16 WXYZ, Dec 23, 2020
    Last edited: Dec 23, 2020
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