Re: Where can I earn 4% annually on my money?

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Re: Where can I earn 4% annually on my money?

Postby porcupine » Wed Dec 26, 2012 9:40 am

tfb made a bold statement on a different thread!
Your $5k can earn another 4% or so elsewhere.

I would really be interested in making 4% or more. Right now, I am putting as much as I can against my mortgage (after all other pre-tax avenues are exhausted, of course).

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Re: Where can I earn 4% annually on my money?

Postby Joe S. » Wed Dec 26, 2012 9:53 am

I read tfb differently than you. He seems to say that you can make 4% on your purchases, not 4% annually on your balance. He seems to be suggesting you can get 4% back on purchases with some credit cards. Exactly what he is talking about is unclear.
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Re: Where can I earn 4% annually on my money?

Postby overst33r » Wed Dec 26, 2012 10:05 am

High interest checking accounts with hoops you have to jump through earn 2-3.5%, but have limits.

http://www.depositaccounts.com/checking ... ounts.html
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Re: Where can I earn 4% annually on my money?

Postby Taylor Larimore » Wed Dec 26, 2012 10:14 am

Porcupine:

Where can I earn 4% annually on my money?


I very much doubt that there is ANY guaranteed liquid investment that yields 4% annually.

Be careful. More money has been lost by investors searching for "higher yield" than has been lost at the point of a gun.

Happy Holiday!
Taylor
"Simplicity is the master key to financial success." -- Jack Bogle
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Re: Where can I earn 4% annually on my money?

Postby livesoft » Wed Dec 26, 2012 10:24 am

OK, this is just 4% on just $5,000. Here's how to do it: Spend $5,000 a month on a cash-back credit card. If that card gives 1% cash back,then than will earn you 12% for the year. Get with the program! Isn't everybody doing this?
It's all about short-term opportunistic rebalancing due to a short-term change in one's asset allocation, uh, I mean opportunistic rebalancing, uh I mean rebalancing, uh I mean market timing.
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Re: Where can I earn 4% annually on my money?

Postby midareff » Wed Dec 26, 2012 10:24 am

Joe S. wrote:I read tfb differently than you. He seems to say that you can make 4% on your purchases, not 4% annually on your balance. He seems to be suggesting you can get 4% back on purchases with some credit cards. Exactly what he is talking about is unclear.


AMEX Blue cash preferred 6% groceries, PenFed Cash 5% Gasoline and Discover in the appropriate quarterly 5% categories being three easy examples.
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Re: Where can I earn 4% annually on my money?

Postby tj » Wed Dec 26, 2012 10:28 am

He is referring to mango direct, bbva compass build my savings ETC ETc
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Re: Where can I earn 4% annually on my money?

Postby tfb » Wed Dec 26, 2012 11:58 am

tj wrote:He is referring to mango direct, bbva compass build my savings ETC ETc

Yes, when you add up those options, a single person can have nearly $20k earning 4% or above, FDIC insured. Double it to $40k for a married couple. Maybe $20k/$40k is not up to a millionaire's standard but for middle class families we often hear about who don't have much savings, it's plenty. It's not true you must take more risk in order to earn a higher return.
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Re: Where can I earn 4% annually on my money?

Postby MathWizard » Wed Dec 26, 2012 12:30 pm

There is no guaranteed place to make 4% at the current time.

However, if I didn't expect to be making greater than 4% in equities over the long term, I would
not hold any equities. There is too much volatility risk in equities to expect only 4% return.

I actually plan using 4% over inflation after (low) expenses, and I consider most likely return would
be better than that (probably about 6% over inflation).

You might want to look at the following 2011 article by Rick Ferri:

http://www.forbes.com/sites/rickferri/2 ... t-forecast

which makes the case much better than I could.
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Re: Where can I earn 4% annually on my money?

Postby origami » Wed Dec 26, 2012 12:32 pm

Peer-to-peer lending (e.g. lendingclub). My return is consistently over 12% before tax for the last 4 years. But it's risky.
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Re: Where can I earn 4% annually on my money?

Postby porcupine » Thu Dec 27, 2012 9:33 am

tfb wrote:
tj wrote:He is referring to mango direct, bbva compass build my savings ETC ETc

Yes, when you add up those options, a single person can have nearly $20k earning 4% or above, FDIC insured. Double it to $40k for a married couple. Maybe $20k/$40k is not up to a millionaire's standard but for middle class families we often hear about who don't have much savings, it's plenty. It's not true you must take more risk in order to earn a higher return.

Thanks! That Mango Direct appears promising. From what I can infer, the prepaid card is a requirement, and the fees for it would be about $5/month (unless I deposit $500/month - why would I want to do that?). The interest on the $5k would be $300, and the net would be $240. Not bad at all, assuming that I understood the set up properly. Did I?

I did not really see anything else mentioned in this thread (even the BBVA Compass) that would earn 4% - did I miss something?

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Re: Where can I earn 4% annually on my money?

Postby Joe S. » Thu Dec 27, 2012 10:10 am

porcupine wrote:
tfb wrote:
tj wrote:He is referring to mango direct, bbva compass build my savings ETC ETc

Yes, when you add up those options, a single person can have nearly $20k earning 4% or above, FDIC insured. Double it to $40k for a married couple. Maybe $20k/$40k is not up to a millionaire's standard but for middle class families we often hear about who don't have much savings, it's plenty. It's not true you must take more risk in order to earn a higher return.

Thanks! That Mango Direct appears promising. From what I can infer, the prepaid card is a requirement, and the fees for it would be about $5/month...
I did not really see anything else mentioned in this thread (even the BBVA Compass) that would earn 4% - did I miss something?
- Porcupine


I may point out that you are not getting 4%. After subtracting the $5/month fee, you are getting at most 3.2% interest. You then have to calculate how much the other fees will ding you. It may still be a good deal, but it's not 4% interest.

You also have to watch out for teaser rates. Some of these companies will offer a high rate, then drop it after a couple of months. They may also add new fees. They often play bait and switch games, where the return on your money drops in the future. You can always change banks and pay a withdrawal fee.

The problem as I see it is that they can't stay solvent offering a true interest rate of 4%, so I highly expect there has to be some trick, otherwise they will go bankrupt.
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Re: Where can I earn 4% annually on my money?

Postby umfundi » Fri Dec 28, 2012 2:47 am

OK, this is just 4% on just $5,000. Here's how to do it: Spend $5,000 a month on a cash-back credit card. If that card gives 1% cash back,then than will earn you 12% for the year. Get with the program! Isn't everybody doing this?

Wow! I was missing this!

A discount on your spending is the same as a return on your investments?

I'll have to go back and read Andy Tobias on the ROI of buying tuna by the case.

Keith
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Re: Where can I earn 4% annually on my money?

Postby reggiesimpson » Fri Dec 28, 2012 9:01 am

Take a look at the Febuary issue of Kiplingers (page 18). There is an answer for you.
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Re: Where can I earn 4% annually on my money?

Postby The Wizard » Fri Dec 28, 2012 9:04 am

Junk bond funds are a good choice for 4%+...
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Re: Where can I earn 4% annually on my money?

Postby umfundi » Fri Dec 28, 2012 9:07 am

The Wizard wrote:Junk bond funds are a good choice for 4%+...

I'm getting 4% on the EE bonds I bought in the 1980's. :D

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Re: Where can I earn 4% annually on my money?

Postby ndchamp » Fri Dec 28, 2012 9:31 am

umfundi wrote:
The Wizard wrote:Junk bond funds are a good choice for 4%+...

I'm getting 4% on the EE bonds I bought in the 1980's. :D
Keith

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Mr Peabody says; "Sherman, set the WABAC (way-back) machine to the 80's."
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Re: Where can I earn 4% annually on my money?

Postby NYBoglehead » Fri Dec 28, 2012 9:34 am

Depending on what the money in question is going to be used for, I'd be willing to be that the TSM will earn 2% in price appreciation and 2% in dividend growth for a total return of 4% next year. Wouldn't recommend that for short-term savings goals but if the point is that you'd like 4% growth I think over the long haul the TSM will get you there. Dips and dives along the way, but 4% annualized isn't asking too much.
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Re: Where can I earn 4% annually on my money?

Postby Epsilon Delta » Fri Dec 28, 2012 8:10 pm

umfundi wrote:
The Wizard wrote:Junk bond funds are a good choice for 4%+...

I'm getting 4% on the EE bonds I bought in the 1980's. :D

Keith

But not for too much longer :( (they stop earning interest after 30 years).
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Re: Where can I earn 4% annually on my money?

Postby mackstann » Fri Dec 28, 2012 8:29 pm

Joe S. wrote:
porcupine wrote:
tfb wrote:
tj wrote:He is referring to mango direct, bbva compass build my savings ETC ETc

Yes, when you add up those options, a single person can have nearly $20k earning 4% or above, FDIC insured. Double it to $40k for a married couple. Maybe $20k/$40k is not up to a millionaire's standard but for middle class families we often hear about who don't have much savings, it's plenty. It's not true you must take more risk in order to earn a higher return.

Thanks! That Mango Direct appears promising. From what I can infer, the prepaid card is a requirement, and the fees for it would be about $5/month...
I did not really see anything else mentioned in this thread (even the BBVA Compass) that would earn 4% - did I miss something?
- Porcupine


I may point out that you are not getting 4%. After subtracting the $5/month fee, you are getting at most 3.2% interest. You then have to calculate how much the other fees will ding you. It may still be a good deal, but it's not 4% interest.


Actually it's around 4.8% after all of the fees. There's a pretty detailed thread about it. Search the forum for Mango.
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Re: Where can I earn 4% annually on my money?

Postby hazlitt777 » Fri Dec 28, 2012 10:59 pm

You might want to try to permanent portfolio. You can do it yourself or try this proxy:

http://permanentportfoliofunds.com/pdfs/Prospectus.pdf

http://permanentportfoliofunds.com/

You should get a real return of 4%. But double check the prospectus.
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Re: Where can I earn 4% annually on my money?

Postby umfundi » Sat Dec 29, 2012 12:53 am

Epsilon Delta wrote:
umfundi wrote:
The Wizard wrote:Junk bond funds are a good choice for 4%+...

I'm getting 4% on the EE bonds I bought in the 1980's. :D

Keith

But not for too much longer :( (they stop earning interest after 30 years).

It's on my calendar: Cash them in starting May, 2018.

Picture this: Geezer walks into a bank to cash a paper treasury bond ... :shock:

This, of course, comes under the heading of "dumb luck". Inflation had subsided, interest rates were still high, my company had payroll deduction to automatically buy them, and the initial deal was something insane like 6% plus something for inflation. (It did not seem insane at the time.)

Should I cash them in or frame them and sell them on e-Bay? :D

Keith
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Re: Where can I earn 4% annually on my money?

Postby Joe S. » Sat Dec 29, 2012 8:49 am

mackstann wrote:
Joe S. wrote:
I may point out that you are not getting 4%. After subtracting the $5/month fee, you are getting at most 3.2% interest. You then have to calculate how much the other fees will ding you. It may still be a good deal, but it's not 4% interest.


Actually it's around 4.8% after all of the fees. There's a pretty detailed thread about it. Search the forum for Mango.


After spending 12 hours searching the Mango forums, it's actually 11.7%. There's a pretty detailed thread about it. Search the forum for Mango. You should find it after a few hours of search. I could provide a link, but it's more fun to find it on your own...
:D
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Re: Where can I earn 4% annually on my money?

Postby jeffyscott » Sat Dec 29, 2012 10:49 am

Epsilon Delta wrote:
umfundi wrote:
The Wizard wrote:Junk bond funds are a good choice for 4%+...

I'm getting 4% on the EE bonds I bought in the 1980's. :D

Keith

But not for too much longer :( (they stop earning interest after 30 years).


Not quite 4%, but new EE bonds will still earn about 3.5%, if you hold them for 20 years.
press on, regardless - John C. Bogle
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