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Re: POLL: How Will You Complete Your 2014 Taxes?

freefilefillableforms.com
fillable pdf seemed closest response in the poll
by Bill M
Sat Jan 31, 2015 2:41 pm
 
Forum: Personal Finance (Not Investing)
Topic: POLL: How Will You Complete Your 2014 Taxes?
Replies: 44
Views: 2396

Re: Any other investors with 70/30 portfolio?

I'm 62, retired, and follow a floor/upside strategy. The floor is 100% bonds, and the upside is 70/30. As the floor is consumed over the years, and the upside stays 70/30, it will lead to what Wade Pfau calls a "rising equity glidepath."
by Bill M
Fri Jan 30, 2015 1:34 pm
 
Forum: Investing - Theory, News & General
Topic: Any other investors with 70/30 portfolio?
Replies: 40
Views: 2972

Re: Is it time to give-up on TIPS?

Why do Bogleheads love TIPS so much? I don't get it. The fed tries its best to control inflation (is it not their mandate?) and we haven't seen much unexpected inflation in decades. Why not just hold Total Bond Market or Intermediate-Term Munis? Won't those, over the long run, keep up with inflatio...
by Bill M
Fri Jan 30, 2015 1:25 pm
 
Forum: Investing - Theory, News & General
Topic: Is it time to give-up on TIPS?
Replies: 42
Views: 4607

Re: File FAFSA with 7 figure non-retirement portfolio?

I believe that some scholarships that are merit or income-based might require fafsa on file, and possibly some college employment opportunities might as well, so I'm not seeing the advantage to not filing. +1 Both our kids got merit scholarships, but the college wouldn't consider the applications w...
by Bill M
Tue Jan 27, 2015 7:53 am
 
Forum: Personal Finance (Not Investing)
Topic: File FAFSA with 7 figure non-retirement portfolio?
Replies: 42
Views: 5362

Re: Refund from the IRS? Why?

Refund from the IRS? Why? For the IBonds, of course. (1) Meet the safe harbor for withholding through the year, (2) calculate your taxes, (3) file a 4868 with the amount due plus $5K, then (4) file the return requesting the refund be issued in IBonds. This year I plan to skip the 4868, just use EFTP...
by Bill M
Tue Jan 27, 2015 7:37 am
 
Forum: Personal Finance (Not Investing)
Topic: Refund from the IRS? Why?
Replies: 51
Views: 4895

Re: Is it time to give-up on TIPS?

One risk in retirement that I'd rather not think about is inflation. TIPS let me totally ignore the potential problem. Like all insurance, it isn't free; but its a good tradeoff. For me, its Stay the course.
by Bill M
Mon Jan 26, 2015 9:47 am
 
Forum: Investing - Theory, News & General
Topic: Is it time to give-up on TIPS?
Replies: 42
Views: 4607

Re: When to take a HSA distribution for past medical costs

Once you turn 65 and are covered by Medicare, you can't contribute any more to the HSA. So the account is "frozen" at that point. But the premiums for Medicare B and D are allowable reimbursements. Also long-term-care premiums. The HSA is a tax-free account, just like a Roth IRA. My withdr...
by Bill M
Mon Jan 26, 2015 9:42 am
 
Forum: Personal Finance (Not Investing)
Topic: When to take a HSA distribution for past medical costs
Replies: 25
Views: 1824

Re: Poll: Locating deceased person's assets

I have needed to do it (for my Mom). It was easy. For over 20 years I have been the one to maintain the computer file with an up-to-date organized list of ALL her assets. This solution doesn't carry over to the next generation, but I have full faith that my kids are more computer savvy than I am and...
by Bill M
Mon Jan 26, 2015 9:26 am
 
Forum: Personal Finance (Not Investing)
Topic: Poll: Locating deceased person's assets
Replies: 33
Views: 2271

Re: Would maxing a Roth and 401k each year be enough?

I think that anyone that has done the calculations and projections realizes pretty quickly that they need to save more each year than Uncle Sam subsidizes. The incentives of tax-deferred accounts might be enough to get people to save some; anyone who has looked at numbers has far more motivation. If...
by Bill M
Fri Jan 23, 2015 9:50 pm
 
Forum: Investing - Theory, News & General
Topic: Would maxing a Roth and 401k each year be enough?
Replies: 17
Views: 2840

Re: when did Backdoor Roth first become available?

Prior to 2010 Roth conversions could only be done by people with AGI under $100K. The "Tax Increase Prevention and Reconciliation Act of 2005" removed that limit, effective 2010. So you could say 2010. But there was a lot of early discussion about whether the IRS would consider the "s...
by Bill M
Thu Jan 22, 2015 10:50 pm
 
Forum: Investing - Theory, News & General
Topic: when did Backdoor Roth first become available?
Replies: 6
Views: 1002

Re: Estimate lump sum from monthly pension

I would like to double check my company's lump sum calculation. I have the monthly annuity amount and I know the PV formula. To do the PV of annuity, I think the company is required to use the interest rates and mortality table by IRS. I went to the IRS website and found these numbers: immediate in...
by Bill M
Thu Jan 22, 2015 6:45 pm
 
Forum: Personal Finance (Not Investing)
Topic: Estimate lump sum from monthly pension
Replies: 4
Views: 330

Re: Poll: What Percent of TIPS in Taxable Account

Don't you have to recalculate each year the principal appreciation and declare it as interest? Seems like a major PIA to have to recalculate it, especially if you are holding it in a Treasury Direct account. Not a PIA. You get a 1099-OID from your broker. I would assume that Treasury Direct also ha...
by Bill M
Thu Jan 22, 2015 11:35 am
 
Forum: Investing - Theory, News & General
Topic: Poll: What Percent of TIPS in Taxable Account
Replies: 27
Views: 1673

Re: Poll: What Percent of TIPS in Taxable Account

Right now about 45% in taxable accounts, and that's the poll response I entered. But, ...those are dedicated to providing the income to delay SocSec to 70. Meanwhile I'm accumulating a TIPS ladder in my Roth IRA. So in about 7-8 years, 100% will be in Roth accounts. Different purposes, different tax...
by Bill M
Thu Jan 22, 2015 11:32 am
 
Forum: Investing - Theory, News & General
Topic: Poll: What Percent of TIPS in Taxable Account
Replies: 27
Views: 1673

Re: AMT............Total Tax Same w/ Std. Deduction/Itemize

Then why are you paying AMT? Take a look at your Form 6251 and see which other deductions you are losing, and to make sure that your tax software filled out the forms correctly. CA state taxes are high, but it's rare for state taxes alone to cause you to pay AMT, unless you paid an unusually large ...
by Bill M
Thu Jan 22, 2015 11:16 am
 
Forum: Personal Finance (Not Investing)
Topic: AMT............Total Tax Same w/ Std. Deduction/Itemize
Replies: 11
Views: 1177

Re: Which of 7 cost-basis methods? (Poll)

Vanguard doesn't offer all 7 of the choices listed, so you end up telling them SPECID, and at time of sale deciding whether you want to sell the high-cost (minimize capital gains), or low-cost (gain harvesting), or other more complex strategy.
by Bill M
Wed Jan 21, 2015 8:22 am
 
Forum: Investing - Theory, News & General
Topic: Which of 7 cost-basis methods? (Poll)
Replies: 11
Views: 881

Re: Feedback please: Lump Sum vs Pension

Under "Related choices" point #2: I disagree with the "not very different", (and you seem to cover these points in more detail later in the wiki). There are some significant differences between the pension and buying an annuity with the lump sum. (1) the pension is backed by PBGC...
by Bill M
Wed Jan 21, 2015 8:08 am
 
Forum: Personal Finance (Not Investing)
Topic: Feedback please: Lump Sum vs Pension
Replies: 8
Views: 759

Re: 401k understanding Trad, Roth, After Tax

Be careful about the company matching formula as you approach the $53K maximum. My MegaCo formula was 2/3 of the first 6% contributed, so I was careful to continue contributions until the end of the year (even though they went way over $53K); I then received a "return of excess contribution&quo...
by Bill M
Wed Jan 21, 2015 7:48 am
 
Forum: Personal Finance (Not Investing)
Topic: 401k understanding Trad, Roth, After Tax
Replies: 5
Views: 616

Re: Does Your 401k Allow (Non-Roth) AFTER-TAX Contributions?

Alan S. wrote:3) Plan could also allow an IRR from the after tax sub account, but the earnings would be taxable.

My plan allowed this, and I used it to convert the entire sub account to Roth with only minor tax impact.
by Bill M
Wed Jan 21, 2015 7:41 am
 
Forum: Personal Finance (Not Investing)
Topic: Does Your 401k Allow (Non-Roth) AFTER-TAX Contributions?
Replies: 44
Views: 6037

Re: HSA Decision/Confusion

There is no reason HSA contributions have to come through payroll deduction...you can make contributions to your account directly (limited by the total family contribution to both HSAs). I'd do that to get the balance up high enough that the account has no fees. Your total (HSA#1 + HSA#2) would have...
by Bill M
Wed Jan 21, 2015 7:34 am
 
Forum: Personal Finance (Not Investing)
Topic: HSA Decision/Confusion
Replies: 5
Views: 606

Re: AMT............Total Tax Same w/ Std. Deduction/Itemize

There are some itemized deductions that carry over to the AMT, like charity donations. Most, like state taxes and real estate taxes, don't. If all your itemized deductions are in the latter case, the total tax is the same, as you noted. Sometimes it's worthwhile to itemize deductions just to get the...
by Bill M
Wed Jan 21, 2015 7:23 am
 
Forum: Personal Finance (Not Investing)
Topic: AMT............Total Tax Same w/ Std. Deduction/Itemize
Replies: 11
Views: 1177

Re: Adjusted Livesoft Income (ALI)

As a retiree, my potential spendable "income" has nothing to do with the numbers on my tax forms. Much of what I call income is totally under my control, like withdrawals from taxable accounts or withdrawals from Roth IRAs, and is not part of AGI nor appears on 1040. Much of what the IRS c...
by Bill M
Wed Jan 21, 2015 7:17 am
 
Forum: Personal Finance (Not Investing)
Topic: Adjusted Livesoft Income (ALI)
Replies: 31
Views: 3035

Re: Bernstein article:How to tell if your nest egg is big en

A good rule of thumb is to have, at the very least, 25 years of RLE saved up to retire at 60, 20 years to retire at 65, and 17 years to retire at 70 Wonder where these figures come from in the article? He's estimating life expectancy to be 85 at age 60 and 65, and 87 at age 70. In the article RLE i...
by Bill M
Tue Jan 20, 2015 1:43 pm
 
Forum: Investing - Theory, News & General
Topic: "When you've won the game, stop playing"
Replies: 83
Views: 8405

Re: A quick poll--pension annuity vs. lump sum

Since you don't, you're really dealing with a question of risk management. Don't think of this question as choice of investment alternatives; think of it as the way to minimize risks. Take the pension annuity. Bill M, no argument with the point that many aspects of this are a risk management decisi...
by Bill M
Mon Jan 19, 2015 7:10 am
 
Forum: Personal Finance (Not Investing)
Topic: A quick poll--pension annuity vs. lump sum
Replies: 62
Views: 3701

Re: A quick poll--pension annuity vs. lump sum

If you had a crystal ball (or waited until the day after you died) you'd know how long you're going to live, and know the market returns; so you'd know the correct answer. Since you don't, you're really dealing with a question of risk management. Don't think of this question as choice of investment ...
by Bill M
Mon Jan 19, 2015 6:39 am
 
Forum: Personal Finance (Not Investing)
Topic: A quick poll--pension annuity vs. lump sum
Replies: 62
Views: 3701

Re: Debate: Roth 401k vs Trad 401k

I've always preferred to pay taxes out of earnings, rather than out of savings. So I've always preferred Roth contributions. However, I think it is more important to max out the contribution, and if you can't max the contribution due to paying taxes now on Roth contributions, do them pre-tax. If the...
by Bill M
Fri Jan 16, 2015 12:14 am
 
Forum: Personal Finance (Not Investing)
Topic: Debate: Roth 401k vs Trad 401k
Replies: 26
Views: 1792

Re: Spousal IRA and Immediate Roth Conversion

Go paperless, so there are no fees. I have several such zero-balance accounts, leftover from Roth conversions, transfers into my 401k plan, etc; never been charged a fee; and am actually wondering if Vanguard will ever close them.
by Bill M
Thu Jan 15, 2015 12:06 pm
 
Forum: Personal Finance (Not Investing)
Topic: Spousal IRA and Immediate Roth Conversion
Replies: 11
Views: 591

Re: Milevsky's got me thinking immediate annuity????

I'm also planning on an immediate annuity, so I understand your thinking. With current rates being so bad, I'm actually planning on splitting it across three purchases, three years apart, so that not all of it will be the lowest rates. You didn't mention whether provision for income taxes was includ...
by Bill M
Wed Jan 14, 2015 8:44 am
 
Forum: Personal Finance (Not Investing)
Topic: Milevsky's got me thinking immediate annuity????
Replies: 28
Views: 2460

Re: Looking for low cost cell phone plans...

We're one of the few holdouts without a cell phone. But for an "emergency phone" to carry in the car, we use the AT&T Prepaid go-phone. It costs $100/year, and gives us far more minutes-of-use than we can ever use.
by Bill M
Sun Jan 11, 2015 2:45 pm
 
Forum: Personal Finance (Not Investing)
Topic: Looking for low cost cell phone plans...
Replies: 47
Views: 3998

Re: Poll: Do you own I Bonds?

The other bad part is the income tax that will be due when they mature after 30 years of compounding . This does put a limit on the maximum you can buy, $15K(single)/25K(couple) * 30 years, and then they roll over. While it's next to impossible to project tax rates 30 years in advance, I suspect my...
by Bill M
Wed Jan 07, 2015 2:40 pm
 
Forum: Investing - Theory, News & General
Topic: Poll: Do you own I Bonds?
Replies: 62
Views: 5475

Re: Early (in the year) RMD from inherited IRAs

I always take my RMDs in mid-December, letting any growth happen in the tax-deferred account. I'm not sure of the argument for taking the RMD early in the year, unless it is needed for spending that year. Is it just a matter of market timing? If you're good at market timing, you should be making you...
by Bill M
Wed Jan 07, 2015 2:29 pm
 
Forum: Investing - Theory, News & General
Topic: Early (in the year) RMD from inherited IRAs
Replies: 11
Views: 1121

Re: Poll: Do you own I Bonds?

Once retired you can't contribute to a 401k any longer, you can't contribute to an IRA, after 65 you can't contribute to an HSA, ... So how do you convert taxable investments into tax-deferred ones? Are there ways other than buying IBonds?
by Bill M
Tue Jan 06, 2015 4:07 pm
 
Forum: Investing - Theory, News & General
Topic: Poll: Do you own I Bonds?
Replies: 62
Views: 5475

Re: How Many Credit Cards do you have?

Normally three -- one to use all the time, one as a backup account in case the primary is lost/stolen, and one separate card for anything over the internet. The latter one gets replaced when fraudulent charges appear (paypal is especially bad); typically every 6-12 months, and about 30 places around...
by Bill M
Tue Jan 06, 2015 3:27 pm
 
Forum: Personal Finance (Not Investing)
Topic: How Many Credit Cards do you have?
Replies: 99
Views: 18036

Re: Filing My Taxes With Free File Fillable Forms?

I've used them several years now; they work just fine. Prior to FFF being available, I used the fillable pdf files from IRS web site; FFF does all that plus some of the calculations plus files them. As AlanS says, you first have to be comfortable with the forms themselves.
by Bill M
Mon Jan 05, 2015 11:43 pm
 
Forum: Personal Finance (Not Investing)
Topic: Filing My Taxes With Free File Fillable Forms?
Replies: 8
Views: 901

Re: Liability Matching - Death of one spouse

My concern is that a fixed yearly amount throughout the duration of the TIPS ladder (which will of course be adjusted by inflation) will fall short when the other elements of the basic expenses calculation (non-indexed pensions, SS couple benefit that gets cut nearly in half at the death of one spo...
by Bill M
Mon Jan 05, 2015 12:27 pm
 
Forum: Investing - Theory, News & General
Topic: Liability Matching - Death of one spouse
Replies: 12
Views: 1278

Re: Liability Matching - Death of one spouse

I'm basically trying to determine if the TIPS ladder element should be set up assuming a uniform base amount per year over the years of coverage, as I have seen in most discussions of LMP, or whether I need to assume a higher base amount at some point in the TIPS ladder to account for either the pe...
by Bill M
Sun Jan 04, 2015 11:19 pm
 
Forum: Investing - Theory, News & General
Topic: Liability Matching - Death of one spouse
Replies: 12
Views: 1278

Re: 401K contributions

My plan (before I retired) allowed 50%; YMMV. But beware that the company match won't cover the entire contribution, and will stop when you retire.
by Bill M
Sun Jan 04, 2015 10:32 am
 
Forum: Personal Finance (Not Investing)
Topic: 401K contributions
Replies: 9
Views: 745

Re: Question About SS Statement Figures

1. increased by COLAs, sort-of (*) 2. yes 3. yes 4. yes (*) Prior to age 60 it's indexed by the Average Wage Index (AWI) not CPI-W. Close but not exactly the same. COLAs based on CPI-W start with the calendar year you turn 62. There is no COLA for the calendar year in which you turn 61; that one is ...
by Bill M
Fri Jan 02, 2015 11:56 pm
 
Forum: Personal Finance (Not Investing)
Topic: Question About SS Statement Figures
Replies: 5
Views: 1007

Re: Withhold Taxes from Pension?

cheese_breath wrote:I pay quarterly estimated taxes and don't withhold from either pension or IRA withdrawals. To each his own.

+1
I find this way easiest. Otherwise I'd be changing the pension withholding every year or so.
by Bill M
Fri Jan 02, 2015 11:48 pm
 
Forum: Personal Finance (Not Investing)
Topic: Withhold Taxes from Pension?
Replies: 19
Views: 1195

Re: Children's Inheritance Provisions in a Trust

We have a provision for a testamentary trust that covers all "support, maintenance, general welfare, and education" expenses of all children until the youngest child turns 22 ("without any requirement to maintain any equality among said children other than that which the Trustees may ...
by Bill M
Fri Jan 02, 2015 2:13 pm
 
Forum: Personal Finance (Not Investing)
Topic: Children's Inheritance Provisions in a Trust
Replies: 7
Views: 852

Re: Question on creating a budget which accounts for taxes.

There are certain "phaseouts" in the tax code that lead to high marginal rates, far above the published tax brackets. They're all below 100%, but when you add similar situations with state taxes it may (in extremely rare situations) go over 100%. It is likely that your non-salary items wil...
by Bill M
Fri Jan 02, 2015 10:49 am
 
Forum: Personal Finance (Not Investing)
Topic: Question on creating a budget which accounts for taxes.
Replies: 5
Views: 514

Re: Financial Planning Review Query

I was offered a complementary "Retirement Consultation" by my Schwab rep in the local office; she was overwhelmed and comp'd me a free consultation like you're considering (the $2K service). The process was OK, the questionaire was good, the report was mediocre (at best), and the Q&A s...
by Bill M
Fri Jan 02, 2015 10:37 am
 
Forum: Personal Finance (Not Investing)
Topic: Financial Planning Review Query
Replies: 5
Views: 1014

Re: Managing Household Records

Such record keeping articles were useful back when records were on paper and the file boxes were always full; with paperless records now they are less so. Consider that 10 years of full household records take less space on my hard drive than last summer's vacation photos. It hardly makes it worth t...
by Bill M
Fri Jan 02, 2015 10:11 am
 
Forum: Personal Finance (Not Investing)
Topic: Managing Household Records
Replies: 12
Views: 1392

Re: buy I-Bonds now or wait until later in the year?

There's no hurry with the fixed rate currently 0%. I'll still get the $5K with the tax refund, but wait until at least May for more. Only questions comes if the rate in May is non-zero -- buy the full annual allotment then, or split it and hope for even higher rate in Oct??
by Bill M
Fri Jan 02, 2015 12:29 am
 
Forum: Investing - Theory, News & General
Topic: buy I-Bonds now or wait until later in the year?
Replies: 11
Views: 1706

Re: Saving too much in retirement accounts? Numbers inside.

I would consider the 100% stocks to be too liable to suffer from "sequence of return" risk. Consider 2008-09; having ~20% in bonds gives you some investment funds to put into the market at the bottom.
by Bill M
Fri Jan 02, 2015 12:13 am
 
Forum: Personal Finance (Not Investing)
Topic: Saving too much in retirement accounts? Numbers inside.
Replies: 16
Views: 4236

Re: take pension with survivor benefits or not

I'm one of the "safety first" types. The guaranteed income is valuable; far more valuable than 401k/savings balances. And the pension provides lots of longevity insurance in case you live significantly longer than 80s. And don't count on survivor needs being only half of the joint needs. I...
by Bill M
Thu Jan 01, 2015 11:49 pm
 
Forum: Personal Finance (Not Investing)
Topic: take pension with survivor benefits or not
Replies: 40
Views: 3001

Re: Managing Household Records

Such record keeping articles were useful back when records were on paper and the file boxes were always full; with paperless records now they are less so. Consider that 10 years of full household records take less space on my hard drive than last summer's vacation photos. It hardly makes it worth th...
by Bill M
Thu Jan 01, 2015 11:32 pm
 
Forum: Personal Finance (Not Investing)
Topic: Managing Household Records
Replies: 12
Views: 1392

Re: Retirement Account Question

Someone certainly can, so the answer is yes. Different question is whether you can. And that answer depends on many things not stated in the original posting, like whether your employer offers a 401k, whether your income qualifies for a pre-tax IRA contribution, etc.
by Bill M
Wed Dec 31, 2014 7:37 am
 
Forum: Investing - Theory, News & General
Topic: Retirement Account Question
Replies: 4
Views: 767

Re: What are your Financial New Year's Resolutions?

Save save save has worked so well for me for so many years that it is tough to change. But I'm retired now, and need to stop saving.

I know that this is a "stretch goal" that is not going to happen. But some amount of reorienting the thinking will (I hope).
by Bill M
Wed Dec 31, 2014 7:34 am
 
Forum: Personal Finance (Not Investing)
Topic: What are your Financial New Year's Resolutions?
Replies: 44
Views: 3303

Re: Best Online Savings bank

A few years ago I needed two new online savings accounts, and opened one at Barclays and one at Ally. The Barclays went through easily, transfers went easy, and rate was (and still is) very good. Ally ran into some sort of snag (don't remember exactly what it was) but to open the account they needed...
by Bill M
Wed Dec 31, 2014 7:23 am
 
Forum: Personal Finance (Not Investing)
Topic: Best Online Savings bank
Replies: 50
Views: 7479
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