|Re: Reserve Studies||<– Date –> <– Thread –>|
|From: Brian Bartholomew (bbstat.ufl.edu)|
|Date: Sat, 5 Aug 2006 14:00:08 -0700 (PDT)|
Do the reserve studies address the currency wearing out with age, too? I'd love to know what forms existing cohos are holding their reserve savings in, such as currency (whose?), stocks or bonds, so that in 20 years it will be worth enough to do what it's been saved to do. Let me wildly claim the rate of monetary inflation is 4% a year. This number is from the St. Louis federal reserve: http://research.stlouisfed.org/publications/usfd/page3.pdf 4 percent per year is 1.04^20 = 2.1911. That means when you go to replace your roof in 20 years, your saved money will buy 1/2.1911 = .4564 = 46% = only half the roof. Rather than discuss what the future rate of inflation might be, which is hard to predict, I would rather assume that monetary inflation will exist at between 3% to 10% a year, and ask how to save a reserve fund in that climate. Brian
HOA Dues Consultants... Marcy, Robert, Nathan & Buddy, August 4 2006
- Re: HOA Dues Consultants... Robert Heinich, August 5 2006
- Reserve Studies [was HOA Dues Consultants...] Sharon Villines, August 5 2006
Results generated by Tiger Technologies Web hosting using MHonArc.