Imagine if your grandparents would have invested wisely

Yeah there are quite a few people who get a lot of wealth passed down from their parents. And it is something that parents should think about more than they do... especially reading the American medias a lot of people are talking about selling their house and renting during retirement. Pulling everything out of their retirment accounts to fund traveling etc. If you do that... spend everything you have... then what do you leave your children with?

 

Thanks. It's also a matter of being wise, on this case, why rent when we can buy? We are paying a similar amount, but instead of going to landlord we are buying something to ourselves.

 

Well unfortunately all my family have been working class and had to scrape by working hard for a living to provide their families with whatever they could.

If I'm honest I think I'd prefer to be brought up like that. It's always gave me a sense of grounding. I remember working in a bar once, earning a bit of extra money and a party of people came in, they was obviously all using daddy's credit card. One of them asked to be served, no please or thank you or anything, and you could tell he though he was above everybody else in the bar.

Suddenly one of the other customers said to him a please or a thank you or even a tip would have been nice...to which he replied...I've never had to say please or thank you before for anything in my life, and I'm certainly not going to start now to the likes of people like you...

If that's what growing up in a wealthy background does to you, then you can keep it!

 

The S&P 500 has averaged 10% a year since 1965. $10k invested in 1965 through today, not adjusting for inflation, would be worth almost $1.2 million. Nice chunk of change.

 

Is that with or without reinvesting the dividends?
Regardless, that $1.2 million at 3% yield would generate $36k per year before taxes. Not a bad additional income... right now I could easily live on that income alone!

 

It's a nice thought but they would have had to have had that kind of money in the first place.

In any case, there is no way I would have expected them to go without, just so they could save money for my benefit. I'd rather go out and earn it myself.

 

This is one of my main reasons of why I want to invest so I can have something for my children and my grandchildren. If possible I don't want them to have to struggle but I still want them to work hard and be wise with their money.

 

That is true. My parents always lived by the why rent when you can buy philosophy, and it honestly just makes sense.

 

That is a good mindset to have. That's showing love for someone who does not even exist yet lol.

 

It does, especially now that we are talking about super long term. That apartment/house that they own, while it will certainly need some repairs once in a while, is basically super cheap accomodation or investment real estate for you and/or your siblings.

The stock market was just one example of how good financial planning can benefit the future generations. Real estate is another good example as it allows your children to either generate income or to save on expenses. Imagine how it would affect the quality of your life if you would never have to take a mortgage (that most spend 20-30 years paying off) to get yourself a house?