# You call that interest???



## Micheal (Jan 28, 2009)

Had a CD mature yesterday. So in light of re-balancing some accounts I though it a good time to remove some money and put it some where I could get better than the .1% the bank was paying.
Let me add that this is on one of 3 revolving (90 day) CD's that I have that I class as part of my readily available emergency funding. So please don't tell me about the "I can do better" as I know I can but.......... I prefer the peace of mind doing it this way brings.
Well, that aside after I withdrew $xxx.xx from the CD the lady doing the transaction(s) informed me that the CD will be now *renewing at .05%* - half of the nothing that they were paying in the first place.......... 
Anyway, in passing I asked what the penalty for early withdrawal would be and she said 3 months worth of interest; or in other words next to nothing.

Guess that's justice of some sort. :sob:


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## unregistered168043 (Sep 9, 2011)

You prefer the 'peace of mind' of losing 2% of your wealth every year? Its called inflation and although the government claims it is around 1.7% more realistic estimates place it over 3%. That means, at .1% you are LOSING 1.6% conservatively, and more like 2.9% realistically.

Over time things get more expensive because your money loses its purchasing power, you must get at least 3% in order to just MAINTAIN your money's value. 

The Fed set rates at near0% to make it less attractive for you to keep your money in the bank...they want to discourage savings and encourage borrowing and investment. You are experiencing this manipulation first hand.


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## ldc (Oct 11, 2006)

Micheal, my heartfelt sympathies on this one; it IS painfull. Best regards, ldc


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## Micheal (Jan 28, 2009)

Darntootin said:


> You prefer the 'peace of mind' of losing 2% of your wealth every year? Its called inflation and although the government claims it is around 1.7% more realistic estimates place it over 3%. That means, at .1% you are LOSING 1.6% conservatively, and more like 2.9% realistically.


 Yep, I consider it the cost of having money readily available - well between the hours of 8:30AM-5PM Mon-Fri and Sat AM. Beside we are only talking about 3+grand tied up into 3 "90 day" CDs.


> Over time things get more expensive because your money loses its purchasing power, you must get at least 3% in order to just MAINTAIN your money's value.


 Yep, agree with that too...... that's why the bulk of my so-called wealth is still in the stock market - but not what I would consider "readily available".


> The Fed set rates at near 0% to make it less attractive for you to keep your money in the bank...they want to discourage savings and encourage borrowing and investment. You are experiencing this manipulation first hand.


Ahhh, I guess....... Yep, it sure is discouraging in the interest rates paid, but I have no need nor desire to borrow. As to the investment(s) I have the bulk of them are more or less on auto pilot via DRIPs and real estate - I am retired, enjoy my life and have lost the desire to chase..... gee... most anything. :cowboy:

idc - thanks for your sympathies; just letting some that they are not alone in the losing battle of interest rates......


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## jwal10 (Jun 5, 2010)

I took my "pocket money" and put it into rentals. Built my own. Good return on investment. Good time to do it too. Many people losing their homes, older people needing affordable housing, so I built small "cabins" to fit their needs. They are built with wide doors, no steps and no hallways, open concept. I only rent to friends from the community, people I have known for years. I get good renters and can provide reasonable rents. Win, win for all of us....James


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## CocalicoSprings (Mar 12, 2008)

jwal10 said:


> I took my "pocket money" and put it into rentals. Built my own. Good return on investment. Good time to do it too. Many people losing their homes, older people needing affordable housing, so I built small "cabins" to fit their needs. They are built with wide doors, no steps and no hallways, open concept. I only rent to friends from the community, people I have known for years. I get good renters and can provide reasonable rents. Win, win for all of us....James


Do you have a picture of what the cabins look like? How much did they cost to build?


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## Bret (Oct 3, 2003)

That is only 1440 years to double your investment. I plan to live that long. I'm just affraid I will forget where I put it.


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## suitcase_sally (Mar 20, 2006)

Inflation is relative. If you are retired, as I am, fuel costs play a lot smaller role in your "inflation bucket". I garden and seldom buy any veggies or fruits. Most of my "grocery money" goes for paper products and cleaning supplies. I have been retired for 8 years and still have about the same number of dollars left at the end of the month as I did when I first retired, so my inflation rate is pretty low.

People talk about the recession causing people to lose 30% of their wealth. I have actually come out way ahead. It's all in what you do with your money, I guess.


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## jwal10 (Jun 5, 2010)

suitcase_sally said:


> People talk about the recession causing people to lose 30% of their wealth. I have actually come out way ahead. It's all in what you do with your money, I guess.



So I take it you are not paying someone to steal (manage) your money for you. I have heard people that haven't retired talk about how their portfolio has lost up to half :umno:....James


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## jwal10 (Jun 5, 2010)

I don't have pictures. I don't have a camera. This was my inspiration but I needed to be able to build them from recycled materials.

http://www.google.com/imgres?imgurl...xJCMUPxLkPaKAt_6gJgG&ved=0CCsQ9QEwAg&dur=3323 

This is the floor plan, except I made the rear door the front door and an L shaped kitchen and island with eating area attached.

Log Guesthouse Diary, Entry #4 &#8211; A Tiny Log Cabin p23 - LogHome.com

They are 1 story so the stairway was removed and the bathroom/ utility takes all that corner. A door to the bath from the bedroom and one from the kitchen area. Front porches are 4'x6' with a shed roof if on the gable end, roof extented on eave side. Green metal roofs and rustic siding.

Spaces Small Cabin Design, Pictures, Remodel, Decor and Ideas - page 42

Oops, you have to scroll down to see the green roof and porch design....James


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## clovis (May 13, 2002)

jwal10 said:


> I took my "pocket money" and put it into rentals. Built my own. Good return on investment. Good time to do it too. Many people losing their homes, older people needing affordable housing, so I built small "cabins" to fit their needs. They are built with wide doors, no steps and no hallways, open concept. I only rent to friends from the community, people I have known for years. I get good renters and can provide reasonable rents. Win, win for all of us....James


Absolutely brilliant!!!!


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## where I want to (Oct 28, 2008)

suitcase_sally said:


> Inflation is relative. I have been retired for 8 years and still have about the same number of dollars left at the end of the month as I did when I first retired, so my inflation rate is pretty low.
> 
> People talk about the recession causing people to lose 30% of their wealth. I have actually come out way ahead. It's all in what you do with your money, I guess.


But if the value of those dollars, ie you can't buy as much with them, then inflation has hit you. At least if I'm reading your post correctly...............

And to all those who rely on interest income, at least you can take solice in hearing Mr. Bernanke say he understands it hard on you.


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## Drizler (Jun 16, 2002)

Keeping money in a CD is worse than a waste of time today. You are far better off putting your money in a quality low cost Mutual fund. If you are interested in having a constant income stream rather than reinvested dividends then try for one that seeks to generate income. Vanguard is one of the biggest as well as the cheapest cost wise as well as the oldest family of funds around. These days you just can't afford to be dealing with banks, they are just plain worthless. You should be able to hook up with an income fund that will bring in between 5 to 10% average annually. It's easier than ever to move money around now as well by yourself with a computer so you can pull it into a money market fund when things start looking ugly like the next few months until the talking heads decide how to compromise on a budget.


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