What's next for Toby Gerhart? - Printable Version
+- The CardBoard (https://thecardboard.org/board)
+-- Forum: C-House! (https://thecardboard.org/board/forum-4.html)
+--- Forum: The CardBoard (https://thecardboard.org/board/forum-5.html)
+--- Thread: What's next for Toby Gerhart? (/thread-11692.html)
+- The CardBoard (https://thecardboard.org/board)
+-- Forum: C-House! (https://thecardboard.org/board/forum-4.html)
+--- Forum: The CardBoard (https://thecardboard.org/board/forum-5.html)
+--- Thread: What's next for Toby Gerhart? (/thread-11692.html)
Re: What's next for Toby Gerhart? - BostonCard - 03-09-2016
(03-09-2016, 01:58 PM)washingtonismoney link Wrote:[quote author=Boston Card link=topic=14712.msg158188#msg158188 date=1457556013]
[quote author=stupac2 link=topic=14712.msg158173#msg158173 date=1457547400]
$11M is absolutely enough to retire on, unless you want to lead a stupidly extravagent lifestyle. My wife and I have calculated it and our number, including our house in the crazy-expensive Bay Area, is around $2.5M. Assuming you get ~5% annual real returns (which isn't insane), $11M is giving you over half a million dollars a year. You can't live on that? I sure could!
Granted, he's probably got less than that, but say he has $5M in the bank, that's still ~$250k a year! My wife and I make a bit over half that. It's plenty to live on.
Remember 5% returns have to be above inflation, or you start eating into your principle. These days, that a minimal concern, with inflation running at about 1%, but it won't be that low forever. And returns aren't what they used to be, what with negative interest rates being all the rage.
[/quote]
But of course this is a contradictory claim. If inflation goes up, interest rates will go up and returns will too.
[/quote]
Yes and no. Taking the S&P 500, nominal returns of course do go up as inflation increases. Real returns, however, tend to do best when there is a moderate amount of inflation (2 - 3%). Returns tend to be lower when inflation is higher because of the expectation that interest rates will rise to take on inflation. And when inflation is very low, returns tend to be low because it is usually a sign that the economy is sputtering.
The correlation between bonds and inflation is much stronger, of course, since bond yields reflect inflation expectations going forward.
BC
Re: What's next for Toby Gerhart? - MustardtheBallCarrier - 03-09-2016
(03-09-2016, 11:16 AM)stupac2 link Wrote:$11M is absolutely enough to retire on, unless you want to lead a stupidly extravagent lifestyle. My wife and I have calculated it and our number, including our house in the crazy-expensive Bay Area, is around $2.5M. Assuming you get ~5% annual real returns (which isn't insane), $11M is giving you over half a million dollars a year. You can't live on that? I sure could!
Granted, he's probably got less than that, but say he has $5M in the bank, that's still ~$250k a year! My wife and I make a bit over half that. It's plenty to live on.
With Fed, state and property taxes, a mortgage on a medium-nice house in SF/LA/NYC areas, private school and child care for the kiddies, healthcare and other insurance, utilities, gas, food, etc., you can blow through half a million a year in very un-exciting fashion. That is a comfortable life one would be fortunate to lead, but it is not stupidly extravagant.
Re: What's next for Toby Gerhart? - MustardtheBallCarrier - 03-09-2016
(03-09-2016, 11:16 AM)stupac2 link Wrote:$11M is absolutely enough to retire on, unless you want to lead a stupidly extravagent lifestyle. My wife and I have calculated it and our number, including our house in the crazy-expensive Bay Area, is around $2.5M. Assuming you get ~5% annual real returns (which isn't insane), $11M is giving you over half a million dollars a year. You can't live on that? I sure could!
Granted, he's probably got less than that, but say he has $5M in the bank, that's still ~$250k a year! My wife and I make a bit over half that. It's plenty to live on.
With Fed, state and property taxes, a mortgage on a medium-nice house in SF/LA/NYC areas, private school and child care for the kiddies, healthcare and other insurance, utilities, gas, food, etc., you can blow through half a million a year in very un-exciting fashion. That is a comfortable life one would be fortunate to lead, but it is not stupidly extravagant.
Re: What's next for Toby Gerhart? - stupac2 - 03-09-2016
I live in a nice house in the SF area and am about to have a kid. If I were making $500k a year I'd be retiring in under a decade.
It all depends on the lifestyle you lead. I was recently talking to a friend of mine who assumed that my wife and I made double what we do in order to afford a house, but really we just don't eat out very much, I bike to work, our car is paid off, things like that. And this is with our entirely too expensive fancy beer hobby and a bunch of saving.
I totally realize that people can and do make high 6 figures and feel like they're struggling, but by and large it's their own damn fault for spending money on things they don't need. Sure, everyone's lifestyle is different, and maybe you would chafe at biking to work and almost never eating out*, but I can guarantee that if I had made $11M over the past 6 years I would be able to retire easily and without any problems. Hell that would probably be enough to retire comfortably AND take a silly risk like opening my own brewpub without success mattering much.
*Though you should try it if you can. I've lost 15 lbs since we moved (I was biking before, but the new commute is longer and hillier), it saves us thousands of dollars a year, and I don't deal with the stress of driving, which is one of the biggest contributors to chronic unhappiness. Getting paid to get healthy is pretty sweet.
Re: What's next for Toby Gerhart? - stupac2 - 03-09-2016
I live in a nice house in the SF area and am about to have a kid. If I were making $500k a year I'd be retiring in under a decade.
It all depends on the lifestyle you lead. I was recently talking to a friend of mine who assumed that my wife and I made double what we do in order to afford a house, but really we just don't eat out very much, I bike to work, our car is paid off, things like that. And this is with our entirely too expensive fancy beer hobby and a bunch of saving.
I totally realize that people can and do make high 6 figures and feel like they're struggling, but by and large it's their own damn fault for spending money on things they don't need. Sure, everyone's lifestyle is different, and maybe you would chafe at biking to work and almost never eating out*, but I can guarantee that if I had made $11M over the past 6 years I would be able to retire easily and without any problems. Hell that would probably be enough to retire comfortably AND take a silly risk like opening my own brewpub without success mattering much.
*Though you should try it if you can. I've lost 15 lbs since we moved (I was biking before, but the new commute is longer and hillier), it saves us thousands of dollars a year, and I don't deal with the stress of driving, which is one of the biggest contributors to chronic unhappiness. Getting paid to get healthy is pretty sweet.
Re: What's next for Toby Gerhart? - bl82 - 03-09-2016
All things considered, he is probably lucky to be out of football after banking $11M gross, with only having inflicted about 500 NFL tackles on his body.
Most NFLers don't have much of a second act, but I'm betting Toby makes the most of his opportunities. After all, he was valedictorian at his HS and I believe he put up a 3.3 GPA in MS&E at Stanford.
Re: What's next for Toby Gerhart? - bl82 - 03-09-2016
All things considered, he is probably lucky to be out of football after banking $11M gross, with only having inflicted about 500 NFL tackles on his body.
Most NFLers don't have much of a second act, but I'm betting Toby makes the most of his opportunities. After all, he was valedictorian at his HS and I believe he put up a 3.3 GPA in MS&E at Stanford.
Re: What's next for Toby Gerhart? - winflop - 03-09-2016
(03-09-2016, 11:16 AM)stupac2 link Wrote:$11M is absolutely enough to retire on, unless you want to lead a stupidly extravagent lifestyle. My wife and I have calculated it and our number, including our house in the crazy-expensive Bay Area, is around $2.5M. Assuming you get ~5% annual real returns (which isn't insane), $11M is giving you over half a million dollars a year. You can't live on that? I sure could!
Granted, he's probably got less than that, but say he has $5M in the bank, that's still ~$250k a year! My wife and I make a bit over half that. It's plenty to live on.
If you can find a way to make a guaranteed 5% after-tax real return then you should be on Wall Street because you'd make Donald Trump look like a pauper.
Re: What's next for Toby Gerhart? - winflop - 03-09-2016
(03-09-2016, 11:16 AM)stupac2 link Wrote:$11M is absolutely enough to retire on, unless you want to lead a stupidly extravagent lifestyle. My wife and I have calculated it and our number, including our house in the crazy-expensive Bay Area, is around $2.5M. Assuming you get ~5% annual real returns (which isn't insane), $11M is giving you over half a million dollars a year. You can't live on that? I sure could!
Granted, he's probably got less than that, but say he has $5M in the bank, that's still ~$250k a year! My wife and I make a bit over half that. It's plenty to live on.
If you can find a way to make a guaranteed 5% after-tax real return then you should be on Wall Street because you'd make Donald Trump look like a pauper.
Re: What's next for Toby Gerhart? - BostonCard - 03-09-2016
stupac is absolutely right. Living in SF/LA/NY is a choice. Sending children to private school is a choice. $500,000 a year doesn't make you immune from economic choices, but I think anyone who feels like they are struggling at that income level is probably making bad choices. I have a friend who is being recruited to a faculty position in Denver, and the real estate agent who they met with said that she would not be able to find a house as modest as they have now (they have a three bedroom/~1500 sf house, which, because they have no kids, is plenty comfortable for them) for the amount of money they have available. So, they have to weigh getting more of a house than they need or want versus paying taxes on the capital gains from the house they bought. I know there is at least one poster here who moved from the Bay Area to Michigan, and can probably comment on how much further $500k/yr will get you there compared to the Bay Area.
It reminds me of this article that made the rounds a few years ago:
http://www.bloomberg.com/news/articles/2012-02-29/wall-street-bonus-withdrawal-means-trading-aspen-for-cheap-chex
BC
Re: What's next for Toby Gerhart? - BostonCard - 03-09-2016
stupac is absolutely right. Living in SF/LA/NY is a choice. Sending children to private school is a choice. $500,000 a year doesn't make you immune from economic choices, but I think anyone who feels like they are struggling at that income level is probably making bad choices. I have a friend who is being recruited to a faculty position in Denver, and the real estate agent who they met with said that she would not be able to find a house as modest as they have now (they have a three bedroom/~1500 sf house, which, because they have no kids, is plenty comfortable for them) for the amount of money they have available. So, they have to weigh getting more of a house than they need or want versus paying taxes on the capital gains from the house they bought. I know there is at least one poster here who moved from the Bay Area to Michigan, and can probably comment on how much further $500k/yr will get you there compared to the Bay Area.
It reminds me of this article that made the rounds a few years ago:
http://www.bloomberg.com/news/articles/2012-02-29/wall-street-bonus-withdrawal-means-trading-aspen-for-cheap-chex
BC
Re: What's next for Toby Gerhart? - CornFed - 03-09-2016
Reminds me of Sherman in Bonfire of the Vanities
Re: What's next for Toby Gerhart? - CornFed - 03-09-2016
Reminds me of Sherman in Bonfire of the Vanities
Re: What's next for Toby Gerhart? - fullmetal - 03-09-2016
(03-09-2016, 04:57 PM)stupac2 link Wrote:I live in a nice house in the SF area and am about to have a kid.
Did I miss this? Congratulations!
Also to the lifestyle choice folks: move to Austin, TX. You might like it here.
Re: What's next for Toby Gerhart? - fullmetal - 03-09-2016
(03-09-2016, 04:57 PM)stupac2 link Wrote:I live in a nice house in the SF area and am about to have a kid.
Did I miss this? Congratulations!
Also to the lifestyle choice folks: move to Austin, TX. You might like it here.
Re: What's next for Toby Gerhart? - Roberton3 - 03-09-2016
(03-09-2016, 05:50 PM)Boston Card link Wrote:...I have a friend who is being recruited to a faculty position in Denver, and the real estate agent who they met with said that she would not be able to find a house as modest as they have now (they have a three bedroom/~1500 sf house, which, because they have no kids, is plenty comfortable for them) for the amount of money they have available. So, they have to weigh getting more of a house than they need or want versus paying taxes on the capital gains from the house they bought...
This is going well OT, but your friend should talk with a competent tax advisor. Based on what you wrote, it sounds like he/she is basing decisions on a tax law that was changed almost 20 years ago. Under current law, the purchase price of your new house has no effect on whether you'll pay capital gains on the sale of the old house.
Re: What's next for Toby Gerhart? - Roberton3 - 03-09-2016
(03-09-2016, 05:50 PM)Boston Card link Wrote:...I have a friend who is being recruited to a faculty position in Denver, and the real estate agent who they met with said that she would not be able to find a house as modest as they have now (they have a three bedroom/~1500 sf house, which, because they have no kids, is plenty comfortable for them) for the amount of money they have available. So, they have to weigh getting more of a house than they need or want versus paying taxes on the capital gains from the house they bought...
This is going well OT, but your friend should talk with a competent tax advisor. Based on what you wrote, it sounds like he/she is basing decisions on a tax law that was changed almost 20 years ago. Under current law, the purchase price of your new house has no effect on whether you'll pay capital gains on the sale of the old house.
Re: What's next for Toby Gerhart? - stupac2 - 03-09-2016
(03-09-2016, 05:48 PM)winflop link Wrote:[quote author=stupac2 link=topic=14712.msg158173#msg158173 date=1457547400]
$11M is absolutely enough to retire on, unless you want to lead a stupidly extravagent lifestyle. My wife and I have calculated it and our number, including our house in the crazy-expensive Bay Area, is around $2.5M. Assuming you get ~5% annual real returns (which isn't insane), $11M is giving you over half a million dollars a year. You can't live on that? I sure could!
Granted, he's probably got less than that, but say he has $5M in the bank, that's still ~$250k a year! My wife and I make a bit over half that. It's plenty to live on.
If you can find a way to make a guaranteed 5% after-tax real return then you should be on Wall Street because you'd make Donald Trump look like a pauper.
[/quote]
There's considerable evidence that Donald Trump under-performed the S&P: http://www.economist.com/news/united-states/21693230-enigma-presidential-candidates-business-affairs-tower-white
It's obviously really sensitive to your end-points, but the historical return of the S&P is about 5% real. And it's not uncommon to see higher, IIRC Stanford's endowment investments see about 7% currently (though this may have been nominal, which ends up being a bit more than 5% real given our current inflation levels).
The article I linked actually suggests living on 4%, and the actual level is obviously going to depends on the volatility of your investments. But living on $5M, even in an expensive place like the Bay Area, is clearly quite doable.
Re: What's next for Toby Gerhart? - stupac2 - 03-09-2016
(03-09-2016, 05:48 PM)winflop link Wrote:[quote author=stupac2 link=topic=14712.msg158173#msg158173 date=1457547400]
$11M is absolutely enough to retire on, unless you want to lead a stupidly extravagent lifestyle. My wife and I have calculated it and our number, including our house in the crazy-expensive Bay Area, is around $2.5M. Assuming you get ~5% annual real returns (which isn't insane), $11M is giving you over half a million dollars a year. You can't live on that? I sure could!
Granted, he's probably got less than that, but say he has $5M in the bank, that's still ~$250k a year! My wife and I make a bit over half that. It's plenty to live on.
If you can find a way to make a guaranteed 5% after-tax real return then you should be on Wall Street because you'd make Donald Trump look like a pauper.
[/quote]
There's considerable evidence that Donald Trump under-performed the S&P: http://www.economist.com/news/united-states/21693230-enigma-presidential-candidates-business-affairs-tower-white
It's obviously really sensitive to your end-points, but the historical return of the S&P is about 5% real. And it's not uncommon to see higher, IIRC Stanford's endowment investments see about 7% currently (though this may have been nominal, which ends up being a bit more than 5% real given our current inflation levels).
The article I linked actually suggests living on 4%, and the actual level is obviously going to depends on the volatility of your investments. But living on $5M, even in an expensive place like the Bay Area, is clearly quite doable.
Re: What's next for Toby Gerhart? - DC - 03-09-2016
(03-09-2016, 10:27 AM)winflop link Wrote:[quote author=stupac2 link=topic=14712.msg158161#msg158161 date=1457542809]
If I had as much money as he'd made I'd sock it in an index fund and live off the interest for the rest of my life. Hopefully he's invested wisely.
Looks like he's made about $11M total. Probably not enough to fully retire on, plus I doubt at age 28/29 he's out of career options or interests
http://www.spotrac.com/nfl/jacksonville-jaguars/toby-gerhart/
[/quote]
Sounds like a lot of money, but that is only if you are somewhat close to retirement age. At 28/29, he should plan for the possibility that he could live another 60 years, and continue adding to his wealth. The money won't seem like that much 50 years from now.