Alex is curious about cryptocurrency. How should she analyze the returns promised by different platforms and where can she go to learn more about crypto in general?
Grace wants to buy a manufactured home for rental income. Should she calculate her returns differently for a manufactured home?
Thomas and his wife have parallel goals of saving for a down payment and contributing to retirement accounts. How should they balance both of these goals?
In today’s episode, former financial planner Joe Saul-Sehy and I tackle these tough questions.
Do you have a question on business, money, trade-offs, financial independence strategies, travel, or investing? Leave it here and we’ll answer them in a future episode.
Alex asks (at 04:11 minutes): I’m more of a traditional investor who has invested in tax deferred accounts for years. I have joined different FIRE communities on Facebook. Most of the time, people talk about traditional investing opportunities.
Once in a while, I’ll connect with people claiming to make a lot of money investing through other investment vehicles, like cryptocurrency – I don’t understand the metrics I should be using to evaluate specific investing opportunities related to crypto.
There are platforms for investing crypto that seem legitimate: They have been around for at least six years, they offer a wide range of opportunities, and they present a set of options to prospective investors. They are based on the amount of money that anyone can start with.
They are able to provide a daily, weekly, and monthly return estimate; I find this interesting because my understanding is that crypto returns are highly speculative.
How would one go about analyzing a firm or a platform and deciding that this opportunity with crypto trading is a good deal?
I’m also interested in learning about crypto but I don’t know where I can find legitimate information about it. How can a responsible investor who is really trying to understand crypto, go about doing so?
Grace asks (at 30:21 minutes): I am calling to get your thoughts on purchasing a manufactured home as a rental property.
I’m an out of state investor looking at a manufactured home right outside of my alma mater in upstate New York. Even accounting for the monthly rent of the lot that the manufactured home is on, the cap rate on this property would be 19-20%. It seems too good to be true so I’m wondering if I’m not doing something right.
Would there be an additional calculation for the depreciation of the home since its lifetime is much shorter than a typical rental property? How would you change the calculations for using a manufactured home as a rental property?
Thomas asks (at 49:11 minutes): My wife and I are forecasting a move for our children to be closer to family in about five years. I’d appreciate your insight into how to achieve some additional financial goals while also saving for a significant down payment on our forever home.
Due to a recent job move, my wife can also contribute to a 457b plan, and we have a set goal to maximize these contributions as well. We are curious how a move in five years could impact those contributions.
Due to unforeseen lost wages in 2020 due to COVID, I took an early 401k withdrawal of $18,000, allowed by the CARES Act. I now have three years to repay that distribution and gain some tax relief. Because I work in a unionized job, I know that my salary should increase over this time, as long as the industry I work in remains healthy.
With an emergency fund already replenished, 401k matches from our company and back door Roth IRA contributions maxed out each year, how would you balance saving for a down payment with our 401k contributions, our 457b contributions and repaying my CARES Act withdrawal.
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