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Re: Backdoor ROTH IRA Tax question

You need to fill out form 8606. See:
http://www.irs.gov/pub/irs-pdf/i8606.pdf

Only the income, if any, should be taxable. The other is basis, assuming you didn't deduct any of it. Vanguard has no idea if you deducted it or not.
by BL
Mon Jan 26, 2015 4:14 pm
 
Forum: Investing - Help with Personal Investments
Topic: Backdoor ROTH IRA Tax question
Replies: 2
Views: 235

Re: Parents Retirement

Please don't assist MS or NM fleece your parents by giving your stamp of approval. Many of these guys are "nice" but that doesn't mean they won't transfer money from your parents to their own retirement. It is very difficult to find a fiduciary that would have your parents' best interests ...
by BL
Mon Jan 26, 2015 4:00 pm
 
Forum: Investing - Help with Personal Investments
Topic: Parents Retirement
Replies: 7
Views: 784

Re: Help for Lively 83 yr. old

Honestly, it looks like you have considered everything, so I couldn't add a thing! The only thing I haven't seen mentioned is Long Term Care, and you probably have that in mind, too. You, together with your aunt, are probably the best-qualified to make decisions on inflation and term-certain or such...
by BL
Mon Jan 26, 2015 1:06 am
 
Forum: Investing - Help with Personal Investments
Topic: Help for Lively 83 yr. old
Replies: 7
Views: 1063

Re: wife's purse

Have her give you a couple of model names if she wants it to be a surprise or else make sure it can be exchanged if she doesn't like it. If it is to be expensive, it might as well be exactly what she wants!
by BL
Sun Jan 25, 2015 11:12 pm
 
Forum: Personal Consumer Issues
Topic: [Purchasing a] wife's purse
Replies: 31
Views: 2475

Re: Should I sell My American Funds?

Yes. I was already planning to do this. There will be a cap gains hit on this investment though. As I had mentioned earlier in this thread, my contributions to the Traditional IRAs were all post-tax. Therefore, I believe I will only have to pay taxes on the gains. Another reason I want to convert i...
by BL
Sun Jan 25, 2015 3:39 pm
 
Forum: Investing - Help with Personal Investments
Topic: Should I sell My American Funds?
Replies: 51
Views: 5482

Re: Help with Merrill Edge Roth Account

Looks like you need to get away from your adviser one way or other. Maybe you can leave it at Merrill Edge until the withdrawal comes down. However, it may be better and cheaper to just rip off the bandage and move it to Vanguard and pay the back-end load. You can save 1% a year on the ER and get aw...
by BL
Sun Jan 25, 2015 12:47 am
 
Forum: Personal Finance (Not Investing)
Topic: Help with Merrill Edge Roth Account
Replies: 7
Views: 562

Re: Investing Options for Mom

Bonds can be somewhat volatile, although not nearly as much as stock funds. If interest rates increase, bond values are expected to go down. Bank/credit union guaranteed accounts and I-Bonds are the most common really "safe" places. They probably don't keep up with inflation, although I-Bo...
by BL
Sat Jan 24, 2015 11:11 pm
 
Forum: Investing - Help with Personal Investments
Topic: Investing Options for Mom
Replies: 2
Views: 277

Re: Elderly Mother in MI - Assisted Living transition

Be very sure that you (and she) would want her to be on Medicaid (if not necessary) before you deplete her assets! Some of those choices are not good, depending on state and communities. Personally I would choose to spend my assets to get the best choices possible. You will have to see a lawyer to a...
by BL
Sat Jan 24, 2015 6:43 pm
 
Forum: Personal Finance (Not Investing)
Topic: Elderly Mother in MI - Assisted Living transition
Replies: 10
Views: 989

Re: Newbie needing help with investments

Not sure where I found this or if someone recommended it, but I read If You Can by William Bernsetein last night! It was a great resource and I'll be reading it again with the homework assignments as part of my education in investments. I love to recommend this, too. It has so many good ideas disti...
by BL
Sat Jan 24, 2015 6:35 pm
 
Forum: Investing - Help with Personal Investments
Topic: Newbie needing help with investments
Replies: 17
Views: 955

Re: Bad 401K or Taxable or Mortgage or Car Loan?

These are just suggestions for research/decision making ( I had a family member who did the 15-yr recently.): Here is another PenFed 5/5 ARM, since you have about 10 years left on current mtg. 5/5 Adjustable Rate Mortgage Adjusts only once every 5 years Months Rate Points APR Payment* First 60 2.750...
by BL
Sat Jan 24, 2015 3:54 pm
 
Forum: Investing - Help with Personal Investments
Topic: Bad 401K or Taxable or Mortgage or Car Loan?
Replies: 19
Views: 772

Re: Some RMD Questions

BL, Thanks. I was really asking about their automated RMD service -- looking to simplify my financial life, eliminate need to plan or think about RMDs. Perhaps I could look at the automated service as a fall-back safety. If I screw up VG will swoop in and save me! This depends on VG's automated pro...
by BL
Sat Jan 24, 2015 3:35 pm
 
Forum: Investing - Help with Personal Investments
Topic: Some RMD Questions
Replies: 21
Views: 1010

Re: Bad 401K or Taxable or Mortgage or Car Loan?

Too bad about her 401k. I would also pay off car and also check into refi the mortgage. Look at PenFed: under 3% for 15-yr and various other alternatives. You can join! I am sure other places have good deals as well and may have better customer service. PenFed: For home purchase or refinancing Loan ...
by BL
Sat Jan 24, 2015 3:18 pm
 
Forum: Investing - Help with Personal Investments
Topic: Bad 401K or Taxable or Mortgage or Car Loan?
Replies: 19
Views: 772

Re: Some RMD Questions

5. Not only in my taxable account (previous question) but in the same funds it came out of from the IRA, and in the same amounts. Is this possible? 4-5. Go into your IRA and select "buy and sell". (This is where I do Roth conversions - non-brokerage) select "exchange (sell to buy) Va...
by BL
Sat Jan 24, 2015 2:54 pm
 
Forum: Investing - Help with Personal Investments
Topic: Some RMD Questions
Replies: 21
Views: 1010

Re: Flagship financial planner advice?

Basically the same as simpler 3-fund portfolio:
https://www.bogleheads.org/wiki/Three-fund_portfolio

Do you have any in a taxable fund? Stocks or municipal bonds are more tax-efficient.
by BL
Sat Jan 24, 2015 11:47 am
 
Forum: Personal Finance (Not Investing)
Topic: Flagship financial planner advice?
Replies: 53
Views: 4803

Re: 2015 Roth IRA question

Do you have a working spouse?

I Googled to find lists of compensation. IRS is always a good site.
Fairmark has this:
http://fairmark.com/retirement/roth-accounts/contributions-to-roth-accounts/qualifying-income-for-ira-contributions/
by BL
Sat Jan 24, 2015 11:37 am
 
Forum: Investing - Help with Personal Investments
Topic: 2015 Roth IRA question
Replies: 5
Views: 421

Re: 401k to Roth conversion for a retiree

Peter Foley wrote:
Married filing jointly you will have 12,400 as a standard deduction and 7,900 in exemptions. This wipes out part of your income for the purposes of taxes. The result in "taxable income."

[


Also add an additional $2,500 SD for a married couple if both over age 65 (1,250/person).
by BL
Sat Jan 24, 2015 10:39 am
 
Forum: Investing - Help with Personal Investments
Topic: 401k to Roth conversion for a retiree
Replies: 15
Views: 1181

Re: Advice request for establishing portfolio

The more "involved" folks are, the more likely to tinker and not stay the course. I think you have come up with a pretty good plan, but I don't memorize symbols so could be mistaken. I would personally steal about 10% from international to buy Extended Market, either now or later. That wou...
by BL
Sat Jan 24, 2015 10:09 am
 
Forum: Investing - Help with Personal Investments
Topic: Advice request for establishing portfolio
Replies: 17
Views: 1057

Re: Vanguard STAR Fund (VGSTX)

If taxable account, taxes should be considered, especially if you are not spending the dividends.
Maybe include municipal bonds.

Above funds are slightly better than Star, which I have continued to keep, staying the course.
by BL
Fri Jan 23, 2015 6:37 pm
 
Forum: Investing - Help with Personal Investments
Topic: Vanguard STAR Fund (VGSTX)
Replies: 8
Views: 960

Re: Advice request for establishing portfolio

You wouldn't in a 401k you can only use what the fund manager has available. Use the best options you can in the 401k up to your company match and then open a IRA with Vanguard to run a 3/4 low cost fund port. I use PTTRX (ER 0.46% -- alot of EURO bonds tho!) and VIIIX (ER 0.02%) in my 401k they ar...
by BL
Fri Jan 23, 2015 6:23 pm
 
Forum: Investing - Help with Personal Investments
Topic: Advice request for establishing portfolio
Replies: 17
Views: 1057

Re: How do you recommend investing 1.5 million?

If you can move everything to Vanguard I bet they can also help you.
With that large a sum, they would be happy to suggest a portfolio after some information is shared.
by BL
Fri Jan 23, 2015 6:19 pm
 
Forum: Investing - Help with Personal Investments
Topic: How do you recommend investing 1.5 million?
Replies: 9
Views: 1577

Re: Advice request for establishing portfolio

One simple idea would be the VANG INST INDEX PLUS (VIIIX) in 401k (What is ER?) and a Life Strategy Aggressive (80/20) in IRA. EDT: It is not exact, but ballpark ratio. That would be somewhere close to your choice. You might enjoy reading this little booklet (on top of recommended reading here): If ...
by BL
Fri Jan 23, 2015 1:52 pm
 
Forum: Investing - Help with Personal Investments
Topic: Advice request for establishing portfolio
Replies: 17
Views: 1057

Re: How do you recommend investing 1.5 million?

Look at Vanguard Tax-Managed Balanced Fund Admiral Shares (VTMFX), 50-50, if you want just one fund in taxable account. Wellington kicks out a lot of taxable income, but if you plan to spend it, perhaps it doesn't matter, depending on your tax bracket. We know nothing about you, see Asking Questions...
by BL
Fri Jan 23, 2015 1:23 pm
 
Forum: Investing - Help with Personal Investments
Topic: How do you recommend investing 1.5 million?
Replies: 9
Views: 1577

Re: Parents Retirement Advice 62 y.o.

I think ideally she should wait until as close to age 70 as she can before filing for her SS. If your father has filed, she is eligible to file for spousal only at FRA, so then they would each have some income coming in before she turns 70. This wouldn't have to be a final choice, they could decide ...
by BL
Fri Jan 23, 2015 1:10 pm
 
Forum: Investing - Help with Personal Investments
Topic: Parents Retirement Advice 62 y.o.
Replies: 8
Views: 942

Re: Terrible ? but...How hard is it to receive life ins payo

I have to ask - Did you buy Term Insurance?

Good idea to get some of this information in your head before you think you need it.
Consider having a file or notebook with vital information in it.
Be sure to have an up-to-date will and beneficiaries for everything.
by BL
Fri Jan 23, 2015 10:24 am
 
Forum: Personal Finance (Not Investing)
Topic: Terrible ? but...How hard is it to receive life ins payout?
Replies: 15
Views: 1790

Re: Cosign or write loan

Would daughter qualify for a loan if she alone applied and you gave her a large down-payment? I know that would also have issues.

You can gift more, all you have to do is report it, not pay taxes unless you have millions.
by BL
Thu Jan 22, 2015 11:03 am
 
Forum: Personal Finance (Not Investing)
Topic: Cosign or write loan
Replies: 40
Views: 1461

Re: HSA Question

Absolutely! Search here for HSA and you will find out a lot. It can be kept until retirement and taken out for documented unreembursed medical expenses the rest of your (and spouse's) life with no taxes ever paid, not even SS & Medicare. I just claimed my little one for past Medicare part B pai...
by BL
Thu Jan 22, 2015 10:45 am
 
Forum: Personal Finance (Not Investing)
Topic: HSA Question
Replies: 3
Views: 332

Re: Cosign or write loan

Perhaps it is time to let them face the consequences of bad financial decisions, rather than rescuing them from it which prevents learning from bad choices. It shouldn't hurt to rent while they are building credit and saving to cover at least 20% down payment.
by BL
Wed Jan 21, 2015 6:17 pm
 
Forum: Personal Finance (Not Investing)
Topic: Cosign or write loan
Replies: 40
Views: 1461

Re: Ethics of an advisor "handing you off" to a colleague

As an example, here is a link to EJs list of fees, direct and from third parties (guess who is paying for them, too?). I don't know your company but you could probably find something similar due to disclosure requirements. https://www.edwardjones.com/groups/ejw_content/@ejw/@us/documents/web_content...
by BL
Wed Jan 21, 2015 6:03 pm
 
Forum: Personal Finance (Not Investing)
Topic: Ethics of an advisor "handing you off" to a colleague
Replies: 38
Views: 2899

Re: Ethics of an advisor "handing you off" to a colleague

I think he did you a favor. Take the hint and move on to a low-cost broker. Read the Wiki and search threads here about moving away from advisers. No need to finance anyone's retirement buy your own.
by BL
Wed Jan 21, 2015 3:52 pm
 
Forum: Personal Finance (Not Investing)
Topic: Ethics of an advisor "handing you off" to a colleague
Replies: 38
Views: 2899

Re: Couples with two homes

Kids move, too, so I wouldn't base a home decision mainly on that. I like picking out one home, maybe a second vacation home, and travel/rent at other places.
by BL
Wed Jan 21, 2015 3:48 pm
 
Forum: Personal Consumer Issues
Topic: Couples with two homes
Replies: 11
Views: 1131

Re: Figuring out my parent's retirement

I don't understand how they qualify for SSDI when they are still working, unless they are earning very little. I would think they would qualify after they have be accepted to receive SSDI, after they are unable to work. Once they are full retirement age, it turns into regular SS. From their booklet:...
by BL
Wed Jan 21, 2015 2:45 pm
 
Forum: Personal Finance (Not Investing)
Topic: Figuring out my parent's retirement
Replies: 15
Views: 1730

Re: Where To Transfer Life Insurance Proceeds

His insurance proceeds should be tax-free. Don't do anything to "save" on taxes by moving them quickly. Bank or credit union insured accounts would be the ideal place to put it for a good while. Cover things like 401k, IRA, education funds if appropriate during this tax year, think about m...
by BL
Tue Jan 20, 2015 10:32 pm
 
Forum: Investing - Help with Personal Investments
Topic: Where To Transfer Life Insurance Proceeds
Replies: 9
Views: 624

Re: 15 year fixed mortgage vs ARM 5 1

This seems high compared to PenFed's 15 yr and 5/5 rates. Perhaps you could look around some more.
by BL
Tue Jan 20, 2015 6:08 pm
 
Forum: Personal Finance (Not Investing)
Topic: 15 year fixed mortgage vs ARM 5 1
Replies: 4
Views: 439

Re: Where To Transfer Life Insurance Proceeds

It is way too soon to make a decision about giving away money or making other major financial moves. He should drop it all in FDIC insured banks, credit unions, etc., spreading it around to 3 or 4 different institutions unless he can get it at one source (CDARS). Then do only the essentials for up t...
by BL
Tue Jan 20, 2015 5:58 pm
 
Forum: Investing - Help with Personal Investments
Topic: Where To Transfer Life Insurance Proceeds
Replies: 9
Views: 624

Re: Tax Preparation--Anyone try this as second income

You can get training and volunteer at VITA or TCE (senior) sites. (I retired this year after about 10 years. I miss it but the coordinator retired and it was too much committed distance driving during the snow and ice season anyway!) One problem may be that you might never want to charge someone for...
by BL
Tue Jan 20, 2015 3:21 pm
 
Forum: Personal Consumer Issues
Topic: Tax Preparation--Anyone try this as second income
Replies: 13
Views: 2109

Re: Immediate fixed income suggestions

I applaud your trying to manage this to make it last, as it is not easy to do this for someone else, but she could survive very well on any number of approaches including a Tips ladder, target retirement Income, SPIA, or a 50/50 Vanguard Tax-Managed Balanced Fund Admiral Shares (VTMFX). I hope you a...
by BL
Mon Jan 19, 2015 11:10 pm
 
Forum: Investing - Help with Personal Investments
Topic: Immediate fixed income suggestions
Replies: 74
Views: 3398

Re: Diversify my portfolio

Have you read Dr Bernstein's little booklet for investing? Here it is:
If You Can: How Millennials can get rich slowly
http://www.etf.com/docs/IfYouCan.pdf

He suggests equal parts of the 3 fund portfolio.
by BL
Mon Jan 19, 2015 9:56 pm
 
Forum: Investing - Help with Personal Investments
Topic: Diversify my portfolio
Replies: 18
Views: 1692

Re: Capital Gains help

If you are re-investing the CGs and dividends, I would turn that off. No need to add more to something you don't feel is right.
by BL
Mon Jan 19, 2015 5:51 pm
 
Forum: Investing - Theory, News & General
Topic: Capital Gains help
Replies: 18
Views: 945

Re: Should parents setup Revocable Living Trust?

I would listen to bsteiner as I value his comments and, AFAIK, he is an attorney with experience in this area.

It doesn't sound like they are asking your opinion so you may not have much input. Perhaps suggesting an attorney if they want to go forward with this would be a good idea.
by BL
Mon Jan 19, 2015 5:47 pm
 
Forum: Personal Finance (Not Investing)
Topic: Should parents setup Revocable Living Trust?
Replies: 8
Views: 884

Re: Help - unwinding windfall assets

I suggest you sell off some of your inheritance to re-imburse you for the extra 401k (or other account) money you are saving to get the maximum. Some things are well worth the taxes you may have. I would put some into a savings account for future expenditures and perhaps a tiny extravagance, if that...
by BL
Mon Jan 19, 2015 3:17 pm
 
Forum: Investing - Help with Personal Investments
Topic: Help - unwinding windfall assets
Replies: 20
Views: 1842

Re: Investing for 18year old and 23year old

You have received good advice here. There is no need to rush to invest, rather take their time and then after studying buy a low-cost diversified fund or 3-fund portfolio. The single tax-managed fund for taxable account and single Life Strategy moderate would be reasonable and simple for investing. ...
by BL
Mon Jan 19, 2015 1:42 am
 
Forum: Investing - Help with Personal Investments
Topic: Investing for 18year old and 23year old
Replies: 14
Views: 1057

Re: What Should I Do With My HSA?

If you can find a way to transfer to a low-cost hsa somewhere else, then it is definitely worth keeping until you retire, so you can use it to pay for Medicare Part B or other qualified medical costs. I had <1,000 in a state account which was very low-cost, and finally used it to pay me back for las...
by BL
Sun Jan 18, 2015 11:59 pm
 
Forum: Personal Finance (Not Investing)
Topic: What Should I Do With My HSA?
Replies: 10
Views: 1089

Re: Help - unwinding windfall assets

I suggest you max out your 401k at least this year, that would give you another 18,000 in capital gains that you could earn by selling off stocks or funds before getting above the 15% tax bracket. Selling losers could expand the amount you could sell off within the 15% bracket. Use a tax program or ...
by BL
Sun Jan 18, 2015 11:34 pm
 
Forum: Investing - Help with Personal Investments
Topic: Help - unwinding windfall assets
Replies: 20
Views: 1842

Re: Should I stop paying into my IUL policy?

Be sure to check term4sale.com for information and maybe that will help you find an independent insurance broker to look for another term insurance policy. Since you were able to get one last year, it seems quite likely you can get one now. Maybe do it before you get out of this policy. Also check w...
by BL
Sun Jan 18, 2015 10:40 pm
 
Forum: Personal Finance (Not Investing)
Topic: Should I stop paying into my IUL policy?
Replies: 7
Views: 597

Re: Selling assets to start Roth IRA

We don't know what funds you own, but this might also be a time to get rid of some less desirable or suitable for taxable accounts. If you own US or international index funds, this might be the start of a good taxable portfolio and would suggest you sell others first (yes, do the Roth IRA!). Search ...
by BL
Sun Jan 18, 2015 8:53 pm
 
Forum: Investing - Help with Personal Investments
Topic: Selling assets to start Roth IRA
Replies: 6
Views: 408

Re: How do I retire?

I have a pension from a former company ($425,000) which I can access immediately, either in a lump sum or spread out over the years in varying terms, until death if I wish. I would seriously suggest you consider the lifetime terms, if you are in reasonably good health. The main reason is that this ...
by BL
Sat Jan 17, 2015 11:23 am
 
Forum: Personal Finance (Not Investing)
Topic: How do I retire?
Replies: 53
Views: 4686

Re: How do I retire?

Don't know if you have a spouse but, if so, you both have options as to when to start drawing Social Security. At least one person waiting until age 70 means you have purchased, while waiting, a much greater payment that will have COLA added. Basically, the best, cheapest annuity around. Just live o...
by BL
Fri Jan 16, 2015 9:44 pm
 
Forum: Personal Finance (Not Investing)
Topic: How do I retire?
Replies: 53
Views: 4686

Re: Is Vanguard STAR appropriate for someone retired?

I have had a Star fund for about 10 years and have been reasonably satisfied with it. On the other hand I would not buy it now, but might consider either/both Wellington and Life strategy Moderate if I wanted 60/40 stock/bond. Life Strategy gets my Boglehead vote, but Wellington also has a draw. Edt...
by BL
Thu Jan 15, 2015 10:41 pm
 
Forum: Investing - Help with Personal Investments
Topic: Is Vanguard STAR appropriate for someone retired?
Replies: 5
Views: 781

Re: Target fund

The class C fund has a 12b-1 fee of 0.75% which goes to the broker.
Does she have any index funds such as a S&P500 index?
Any Vanguard or Spartan funds?
by BL
Thu Jan 15, 2015 7:14 pm
 
Forum: Investing - Help with Personal Investments
Topic: Target fund
Replies: 5
Views: 624
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