Two incomes, no kids, slaving away to pay $1750 to RENT a place -- though it doesn't matter that they don't have a homestead, since they don't have any kids anyhow... *sigh*
They make $170,000 a year combined -- now THOSE are the kind of jobs that are impossible to replace when times get tough. You don't want your expenses to require that kind of income -- EVER. You can BUY a nice house with 5 acres in Texas for $180,000 - $200,000 or so. If you don't want land, you can get a nice place for $100,000 - $120,000.
It just seems like a waste of two lives, insofar as their lives seem to have little or no meaning. They're not dedicating their lives to God, they're not helping to create souls for heaven, NOTHING that matters. Even single/childless people could be dedicating their lives to help the Faith in some way. But all they seem to be hoping for is to be able to retire and travel when they're 59.
Get up in the morning. Work and earn a bunch of money. Pay it all away to someone else. Repeat until death.
What a sad existence!
Merging portfolios after marriage
This young couple have a simple goal: repair their portfolio and save to buy a new home within the next three years.
(Money Magazine) -- Like most investors, Wendy and Doug Kirk were worried about how the stock market was doing last fall. But it was hardly at the forefront of their thoughts: After knowing each other for more than 25 years - they both grew up in Ocean Township, N.J. - and dating for more than three, the couple tied the knot in September.
Now, with the wedding behind them, the pair, who live in Oakland, Calif., have begun to look at their collective finances. And they're starting to wonder whether they were investing properly to begin with.
Wendy, for instance, says some of her mutual funds fell more than 50% in 2008. "I never thought I was that aggressive," she says. Having lost more than $60,000 in the bear market around the time they hoped to start saving for a home, Wendy, 38, and Doug, 41, want a fresh start.
As they combine their portfolios, they want to make sure that they are properly diversified. They also want to know whether they're still on track to buy their dream home. Says Wendy: "Now that we've joined our finances, we want to make sure we're on the right path."
Where they are now
Combined, the couple make slightly more than $170,000 a year. Doug, a docuмent-management executive, and Wendy, a regulatory examiner, have saved around $150,000 in their retirement accounts. The couple, who don't plan on having kids, owe roughly $20,000 in student loans but don't have any other debt. They rent a two-bedroom home in Oakland for $1,750 a month.
What they should do
Streamline their portfolio. Taken together, the couple's portfolios are about 80% in stocks and 20% in bonds. At their age, that's not unreasonable, says Oakland certified financial planner Pat Jennerjohn. But given the Kirks' concerns about their recent losses, Jennerjohn recommends dialing down that equity exposure to around 70%.
That's easily done. The couple's money is spread among more than 15 funds, with some clear overlap. For example, they own three Legg Mason stock funds managed in similar styles. And all three are trailing around 90% of their peers over the past one, three, and five years. Jennerjohn recommends selling them and moving the money into funds that invest in both stocks and bonds.
The Kirks should also keep an eye on investment fees. "What I'm seeing with the funds you own is extremely high costs," the planner tells Wendy. "That's a huge drag." To reduce costs, Jennerjohn suggests going with low-cost all-in-one funds such as T. Rowe Price Personal Strategy Growth (TRSGX) or Vanguard STAR (VGSTX). The STAR fund, for example, holds 11 Vanguard stock and bond portfolios but charges an expense ratio of just 0.32%.
Create a formal savings plan. The couple's biggest concern is that they may not be saving enough. "It seems like things always come up," Wendy says. "We're always putting the money toward a credit card or something else."
Wendy and Doug say that they try to put away $1,400 a month beyond retirement savings. But to be sure of having a down payment in excess of $50,000 in three years, the Kirks should save $1,570 a month, says Jennerjohn. To get there, the planner tells the couple to find ways that they can trim their expenses. Wendy and Doug say they can cut their $600-a-month entertainment budget. Moreover, the Kirks will consider setting up automatic deposits into low-risk fixed-income funds such as Vanguard Short-Term Bond Index (VBISX).
Finally, Jennerjohn suggests an experiment: Put away the credit cards and use only cash for 60 days. "You will spend more if you use a card," she tells the couple. Wendy agrees: "It's a lot harder to part with your cash than it is to just throw your credit card out there."
The Makeover
The problem: Wendy and Doug weren't sure if they were investing properly when they were single. Now married, they're even more unsure what the right investment mix is.
The plan: Reduce their overall exposure to equities from 80% to around 70%. Start by selling stock funds that have been underperforming their peers for years.
The payoff: The couple are young enough to keep 80% of their money in stocks. But this slight adjustment should reduce the overall risk in their portfolio, helping them cope with market volatility.
The problem: After combining their portfolios, the Kirks found that they owned more than 15 different mutual funds between them. And some of those funds overlapped.
The plan: Sell some of their redundant funds, especially those portfolios that are charging higher-than-average annual expenses.
The payoff: This should help streamline the couple's combined portfolio, making it easier for the Kirks to manage. It should also reduce their investment costs, which are a drag on performance.
The problem: The couple are worried that they won't be able to save $50,000 in the next three years for a down payment on a new home.
The plan: Find places to cut their spending, such as in their entertainment budget. Also, consider enrolling in an automatic savings program.
The payoff: By creating a formal savings program, the couple can boost their monthly savings from $1,400 to around $1,570. And that should put them on target for a home.
Topic: What a waste of a life (Read 686 times)