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This is a hypothetical story of Mr. Jones, a retired person who gets caught in a bad set of circumstances.

When Mr. Jones first retired back in 1993 things looked pretty good.  At 61 years old with $2.50 million dollars saved up it looked like he was well prepared. Mr. Jones played things very safe.  He did not invest in stocks or real estate. He did not fall victum to a fraud or ponzi. He has made decent money off  his $2.50 million dollars every year and he did not try to live above his means. However today in 2012 Mr. Jones is in big trouble. Take time to read what happen to Mr. Jones and consider the path you are on.

 

The Developer

 

The Story of Mr. Jones

 

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Comment by Eric Watkins on August 22, 2016 at 4:29pm

I agree with some assessments. I always hear a lot of people talk about buying real estate, it is a good idea but like Shanawia said, Mr. Jones would have been to old to manage the properties and you know how kids and grand kids handle money that they didn't earn.  If he had the knowledge or information he could have bought mortgage notes, that way he could be the bank himself versus having brick and mortar plus having to deal with leaky sinks and stopped toilets and dealing with all of the headaches that come with being a landlord. That is a different part of the game, control the paper and you control the game.  One of the biggest lies and titles given about homeownership, (Being a homeowner).  You are not a homeowner until the house is paid off, if you don't believe me miss a payment or two and you will find out real quick who owns your home (The note holder, not the so called homeowner/mortgagee).

Comment by Orrin Ledgister Jr on June 20, 2015 at 10:21am

I read your comment about the Mr. Jones example. FYI the real money gets made with the Supra Vantage. I am rocking off with those boys. They make money off the money with the trading machine. I have been rolling with them for a while now.  They are the real deal.

www.supravantage.net

www.vantagetradingcompany.com

Comment by VALERIE CHARACTER on June 20, 2015 at 1:42am

Mr Jones should have had a safe installed under the ground put half of that money in there and told no one not even his wife, left that life insurance  policy alone. with the other half  he  maybe should have  bought 2 CDs instead of  5 hired a smart reputable real estate sales person who would teach him  how to purchase high end foreclosed on or short sale  properties that he would be able to resell for a much higher profit, kept some for renting to have some real steady income coming in that would help pay off that loan.

Hire a reputable financial advisor (not telling them about the money at home in the safe) to find him a variety of different avenues to invest his money in instead of putting it all in the same basket. as soon as his money started dropping he should have pulled it out and tried something else. his son went to medical school why isn't he paying off that 13 year old loan.

and for the son that needs assistance it sounds like he's paying the whole bill not assisting. Mr. Jones should've bailed out a long time ago filed bankruptcy. packed up his money in the safe, what ever he had left in his accounts ,his wife and moved to an island where no one could find him bought himself a small farm and enjoyed the rest of his days.

SO WHAT HAVE I LEARNED FROM THIS SCENARIO  

never trust all of your money in someone else's hands our grandparents didn't they always kept some hidden away and close by  and we never went without. seems they were a lot smarter than us it's time to go back to that old way of thinking just get a safe instead of a mattress this way you'll have something to fall back on when the worlds systems rip you off and it won't burn up if the house catches on fire.

Comment by Shanaiwa Willis on May 13, 2015 at 5:46pm

Hey Avery,

Your plan for Mr. Jones sounds good. But tell me where you can get $49,200 per year on $1,500,00.00 in a CD. Not happening these days. You also did not factor in the interest Mr. Jones would be paying on the $1.0 million you say he needs to borrow to buy the real estate. Although CD's were paying a lot more when Mr. Jones first retired. But today Mr. Jones is around 80. Now he is in trouble. But the real estate play may be good, however at his age he may have a hard time managing the properties.

Comment by Raymond Breedwell on May 13, 2015 at 5:31pm

The only way to make money off of your savings is to take some sort of chance. If you play it safe and buy CDs you get nothing on your money. This has been the case for some years now, and it looks like these low rates will be lingering for a while to come. If you gamble in the market you may do OK. Just be careful when you play. 

Comment by Avery Pitts on February 25, 2015 at 2:14am

It's very sad to think after busting your hump grinding for 30 plus years, to discover the financial institutions are milking us dry. However I have a hard time believing someone with $2,5 million saved, don't know how to diversify to maximize returns. 

If I was in Mr Jones situation, finding a solution wouldn't be that difficult, at the age of 61

(1) before i reinvest in the next 5yr jumbo CD, I would borrow $1,Mil against the $2.5Mil at the lowest interest rate. then take the borrowed $1Mil and use it to purchase 4 rental properties at $200k each yielding $19,200 each per yr in rent totaling $76,800k per yr, minus taxes & insurance -$12k, leaving a balance of $64,800. with the remaining $200k left from the $1mil. will be reserved for repairs and other expenses.

(2) The $1.5mil left in the CD would yield $49,200 plus the $64,800 totaling $114,000 per yr.

(3) Also I would purchase a duplex for the grand son while in medical school, to off set what it would cost to pay for housing, and rent the other side. Giving him $10,800 per yr, minus taxes & insurance -$3,k balance left is $7,800 which can be used to food & utilities.

It's going to be ruff the 1st 2yrs the grand son is in school, by the third year he should be interning and helping to contribute to the bottom line. 

Comment by The Developer on November 28, 2014 at 12:45am

The word on the street  is interest rates will remain low for quite some time. So the story of Mr. Jones and people in his position will most likely continue. I know this is hard on the people that are extremely risk averse. CDs and money markets are just not making any money. As a result people must find ways to participate in some sort of market activity if they are to reap any real rewards from investing.

Comment by Stephen Pettiway on June 2, 2014 at 8:18pm

Mr. Jones Fucked up to say the least, the answer is quite simple Mr. Jones needs to become a member of Wall Street Insight and learn how to increase his cash flow.

Comment by Ruthenia Ward on May 17, 2014 at 10:15am

I can really relate to this story. I remember when interest rates in the early 1980's were over 10%. Now look at were they are today. What a big change in the income stream for those who need to play it safe by investing in CDs.

Comment by Cliford Eralie on November 16, 2013 at 11:27pm

This is a hell of lesson on how the tables can be turned. I see now what they mean when they say the savers are being forced into the market. If you are not willing to take risk you will not make any money. Wow that means the elderly that are not prepeared mentally to take risk are shit out of luck. With rates as low as they are a person with $5.00 million in CDs is just getting by.

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