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WhoWee
#40
Aug25-11, 12:40 PM
P: 1,123
Quote Quote by rhody View Post
5 retirement tactics in a low-interest-rate world

The bottom line, prioritize your expenses, and learn to do more with less, unless you want to take on more risk, a dicey thing to do if you are retired.

Rhody...
Quote Quote by rhody View Post
5 retirement tactics in a low-interest-rate world

5 retirement tactics in a low-interest-rate world
The yield on the 10-year U.S. Treasury note is about 2%, or one-half its yield in February. The yield on the two-year note is 0.22%, about two-thirds its yield at the beginning of 2011. Meanwhile, inflation has risen 3.63% over the 12 months ending July 2011.

Letís put this in perspective. If in February you had a $500,000 portfolio of 10-year U.S. Treasury notes throwing off $20,000 in income to fund your living expenses, and for some reason you had to reinvest all that money in the 10-year notes being issued today, your portfolio would generate only $10,000 in interest income. Meanwhile, the cost of goods and services that your $20,000 in interest income once paid for has now risen to $20,600.


The bottom line, prioritize your expenses, and learn to do more with less, unless you want to take on more risk, a dicey thing to do if you are retired.

Rhody...
The only good thing about the recession is devalued assets - especially real estate - but it's clearly not for everyone.