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Re: Local college invests 56% of assets in "alternatives"

Or, alternatively, if I may use such a term in this thread, the snooty-and-much-maligned-because-those-stinkin'-college-boys-thinks-theys-better-'n-us Ivies' endowments were not attempting to beat the S&P 500, or even match it, but instead were holding fixed income and other investments to mitig...
by Dandy
Wed Oct 22, 2014 8:00 am
 
Forum: Investing - Theory, News & General
Topic: Local college invests 56% of assets in "alternatives"
Replies: 29
Views: 2829

Re: Local college invests 56% of assets in "alternatives"

There was a news bit on Bloomberg today that none of the ivy league colleges endowments beat the S&P 500. The highest was about 20% vs the S&P 500 of about 29%. I only saw it for a moment so I may have the numbers off a bit. Alternative investments/hedge funds were all the rage -- that may h...
by Dandy
Tue Oct 21, 2014 7:39 pm
 
Forum: Investing - Theory, News & General
Topic: Local college invests 56% of assets in "alternatives"
Replies: 29
Views: 2829

Re: Risk in a high dividend stock portfolio

So why would a stock that had a decent level of risk pay a 10% dividend? If it had any growth prospects it would be trying to conserve money for investing in the company. It might pay a dividend of a few percent but 10%? Not likely. When dividends are that out of the normal range - stay away By the ...
by Dandy
Tue Oct 21, 2014 7:33 pm
 
Forum: Investing - Theory, News & General
Topic: Risk in a high dividend stock portfolio
Replies: 16
Views: 1484

Re: Advice needed for next 10 years: Save, spend borrow?

I would opt for cutting expenses now. Easy to say. But in retirement while the expense challenges will surely be different they will exist and you won't want your expenses to exceed a reasonable withdrawal. I always look to trimming ongoing expenses e.g. cable, phones, subscriptions, etc. it is easy...
by Dandy
Mon Oct 20, 2014 5:29 pm
 
Forum: Personal Finance (Not Investing)
Topic: Advice needed for next 10 years: Save, spend borrow?
Replies: 18
Views: 2456

Re: TBM too much treasury?

Most respected financial experts cited by above probably recommend Total bond in many of their portfolios. It is a good fund. But the tag Total Bond Fund next to many names is misleading. Ferri's 60/40 portfolio also includes TIPS and High Yield Bernstein while very aggressive for young investors re...
by Dandy
Mon Oct 20, 2014 1:14 pm
 
Forum: Investing - Help with Personal Investments
Topic: TBM too much treasury?
Replies: 67
Views: 4167

Re: TBM too much treasury?

Why all the focus on a substitute index? Low cost and diversification are usually provided by broad based index funds -- that track someone's index. If there is no index that includes (or can't include) some fixed income products like TIPS, muni's or even CDs does that mean they should be avoided? A...
by Dandy
Sun Oct 19, 2014 2:54 pm
 
Forum: Investing - Help with Personal Investments
Topic: TBM too much treasury?
Replies: 67
Views: 4167

Re: Debit Card was hacked. Should I just use cash from now

Cash for relatively small purchases and gas (which often is not a small purchase) Credit cards for the rest. Debit card only for ATM or if no alternative. Not a fan of using any type of plastic for small purchases like getting coffee.
by Dandy
Sun Oct 19, 2014 11:33 am
 
Forum: Personal Finance (Not Investing)
Topic: Debit Card was hacked. Should I just use cash from now on?
Replies: 54
Views: 3217

Re: Help me choose... [Retirement withdrawal strategy]

I guess the thirds' comes closest for me. But, I like WM Bernstein's idea of putting more emphasis on securing your retirement as the main focus. First put 20-25 years of your anticipated retirement drawdown needs in "safe" products. e.g. short term bonds/funds, CDs, etc. and then invest t...
by Dandy
Sun Oct 19, 2014 11:29 am
 
Forum: Personal Finance (Not Investing)
Topic: Help me choose... [Retirement withdrawal strategy]
Replies: 12
Views: 1259

Re: POLL: How fulfilling is your retirement?

In casual conversations over the 6 years in retirement only one person expressed not being happy and most were pleasantly surprised how easily they adapted. Now this is mostly with younger, healthy retirees that seem to be in decent financial shape. For some it was travel for others it was children ...
by Dandy
Sun Oct 19, 2014 11:06 am
 
Forum: Personal Finance (Not Investing)
Topic: POLL: How fulfilling is your retirement?
Replies: 34
Views: 2979

Re: Solarcity Solar Bonds

What makes you think these are "very good" rates? Rates relate to term and risk. Bonds are usually issued and subsequently trade based on rates, term and risks. The market is pretty efficient. If Solarcity thought they could sell out their bonds at a lower rate they would have done so. Now...
by Dandy
Sun Oct 19, 2014 10:16 am
 
Forum: Investing - Help with Personal Investments
Topic: Solarcity Solar Bonds
Replies: 6
Views: 805

Re: Rebalancing with dividends

If your rebalancing is simple e.g. you want to reduce Total Stock and increase Total bond then going straight to the Total bond with Total Stock Divs and Cap Gains makes sense. In some more complex portfolios you might send those distributions to money market (and hold your nose due to the low rates...
by Dandy
Sun Oct 19, 2014 10:03 am
 
Forum: Investing - Help with Personal Investments
Topic: Rebalancing with dividends
Replies: 8
Views: 952

Re: Vanguard Balanced Index vs. Vanguard Lifestrategy Modera

Both are good choices. The more funds your balanced fund has the more likely it will contain investments you don't want or an allocation you don't want. e.g. do you want International bonds? Do you want x% allocated to International stock or y% allocated to it. I wouldn't be overly concerned about a...
by Dandy
Sun Oct 19, 2014 7:59 am
 
Forum: Investing - Help with Personal Investments
Topic: Vanguard Balanced Index vs. Vanguard Lifestrategy Moderate
Replies: 17
Views: 2202

Re: TBM too much treasury?

Please name the index you would prefer . I don't know of a better index . If there isn't one why should my fixed income allocation be limited to a bond fund that, while good, doesn't include some low cost, safe products like TIPS, Stable Value Funds and CDs? There is often an underlying message tha...
by Dandy
Sat Oct 18, 2014 12:14 pm
 
Forum: Investing - Help with Personal Investments
Topic: TBM too much treasury?
Replies: 67
Views: 4167

Re: TBM too much treasury?

somewhat diversified bond fund": Are you saying that 7584 bonds of a wide range of maturities (all maturities over 1 year) is not enough diversification? What bond fund would you recommend as an alternative? You are focused on bond funds I am looking at fixed income including bond funds. As me...
by Dandy
Sat Oct 18, 2014 11:01 am
 
Forum: Investing - Help with Personal Investments
Topic: TBM too much treasury?
Replies: 67
Views: 4167

Re: TBM too much treasury?

Treasuries are a bit overdone but that isn't a real problem. The real problem is Total Bond isn't the complete answer to fixed income. It is a good fund and if you are stuck on only having one fixed income option not a bad choice. But there are an array of fixed income products all with different pr...
by Dandy
Sat Oct 18, 2014 7:35 am
 
Forum: Investing - Help with Personal Investments
Topic: TBM too much treasury?
Replies: 67
Views: 4167

Re: Are Vanguard's target-retirement funds too aggressive?

I think they are too aggressive, especially the late dated ones. There is good theory that young people can go very aggressive because they have lots of time on their hands. That makes sense but ignores what is the risk tolerance of a new, inexperience investor? What happens if they save aggressivel...
by Dandy
Fri Oct 17, 2014 7:32 pm
 
Forum: Investing - Theory, News & General
Topic: Are Vanguard's target-retirement funds too aggressive?
Replies: 24
Views: 1707

Re: Does your ROTH hold risky or stable items?

The RMDs will partly disrupt that strategy, and for some they RMDs plus pension plus SS will be substantial enough that there will be no 0% or low tax rate period I'm pretty sure even after my planned Roth conversions before age 70 my RMD (plus pension and SS) will keep my in a high tax bracket. Th...
by Dandy
Thu Oct 16, 2014 10:13 am
 
Forum: Investing - Theory, News & General
Topic: Does your ROTH hold risky or stable items?
Replies: 56
Views: 3339

Re: Who should regularly contribute to taxable investments?

Nice list.
I expect that my RMDs will be larger than my needs. Nice problem. RMDs will be drawn from my TIRA which is mostly in fixed income. So I expect that the "excess" RMD will either be gifted to children/charity or invested in taxable muni funds.
by Dandy
Thu Oct 16, 2014 9:13 am
 
Forum: Investing - Theory, News & General
Topic: Who should regularly contribute to taxable investments?
Replies: 34
Views: 3537

Re: Does your ROTH hold risky or stable items?

My plan is for our Roth accounts to be about 80/20. Vs our overall portfolio goal of 40/60. I expect our Roth's will be the last money to use. I would certainly use this current market drop to move money from Roth fixed income to Roth equities rather than add equities to my TIRA. I want to reduce th...
by Dandy
Thu Oct 16, 2014 9:07 am
 
Forum: Investing - Theory, News & General
Topic: Does your ROTH hold risky or stable items?
Replies: 56
Views: 3339

Re: Why are 401k plans expensive?

Mostly greed in my opinion. The fund companies make lots of money and maybe a cut goes to the company - say to offset admin expense. Usually, the company group that decides what firm to choose is either conflicted or not competent. That being said small 401k plans are especially expensive to adminis...
by Dandy
Thu Oct 16, 2014 8:58 am
 
Forum: Investing - Theory, News & General
Topic: Why are 401k plans expensive?
Replies: 39
Views: 2988

Re: The Role of Life Expectancy

Pretty much ignore. Averages say live to about 85 making sure I have "safe" funding to age 90. Wife and I had one parent that made it to age 90 and one that died in their 80's. So genes are probably that one of us will live to age 90. The challenge is what will be the out of pocket medical...
by Dandy
Thu Oct 16, 2014 8:43 am
 
Forum: Investing - Theory, News & General
Topic: The Role of Life Expectancy
Replies: 25
Views: 1653

Re: Retired, my viewpoint has changed again.

When you retire it is often a major event. Loss of earning power, different social interactions, extra time etc. It also drives home the fact that the pot is all you got and it may have to last 30 or more years - no more contributions to your 401k,etc. Our fathers usually had only a pension and SS a...
by Dandy
Thu Oct 16, 2014 8:39 am
 
Forum: Personal Finance (Not Investing)
Topic: Retired, my viewpoint has changed again.
Replies: 22
Views: 3136

Re: Dry Powder

I have no problem with that approach especially with only 2% of your portfolio. Actually, this recent volatility has been accompanied with a dramatic drop in interest rates. So, if your dry powder had been in a bond fund you would have more dry powder than you have now. I believe a drop in interest ...
by Dandy
Thu Oct 16, 2014 8:26 am
 
Forum: Investing - Theory, News & General
Topic: Dry Powder
Replies: 49
Views: 3504

Re: Treat all accts as 1 BIG account for AA or target 70/30

I would treat all accounts with the same purpose as one account. e.g. all retirement accounts. Not sure if I would lump other accounts in with retirement since they may have different objectives or will be used at a different time. The advantage of treating all retirement accounts as one account is ...
by Dandy
Thu Oct 16, 2014 8:19 am
 
Forum: Investing - Help with Personal Investments
Topic: Treat all accts as 1 BIG account for AA or target 70/30 each
Replies: 7
Views: 879

Re: Looming Corporate Bond Crash?

There is always a guy that predicts a disaster for a product or market. That is how they get attention -- get quoted, go on CNBC, etc. If they happen to get it even mostly right they are crowned as a guru and get almost lifetime benefits. If they are wrong they are soon ignored and attention goes to...
by Dandy
Wed Oct 15, 2014 12:09 am
 
Forum: Investing - Help with Personal Investments
Topic: Looming Corporate Bond Crash?
Replies: 4
Views: 589

Re: Siren song of increased stock allocation

I have been counting on this correction. The siren song I don't hear is the one calling me to a 2.2% 10 year. Oh I thought we were discussing increasing equity allocations because?? a gut feeling?? If you want to discuss fixed income and you are in retirement a small amount in a 10 yr CD might be o...
by Dandy
Tue Oct 14, 2014 11:50 pm
 
Forum: Investing - Help with Personal Investments
Topic: Siren song of increased stock allocation
Replies: 38
Views: 2891

Re: Buffett Says ‘No-Brainer’ to Get a Mortgage to Short Rat

young couples are having trouble getting a down payment, banks are trying to meet new regulatory requirements so are being very careful about mortgage loans, High unemployment, high underemployment, Jobs are less secure, many have large student loans to pay off .. Warren where have you been? My daug...
by Dandy
Tue Oct 14, 2014 11:30 pm
 
Forum: Personal Finance (Not Investing)
Topic: Buffett Says ‘No-Brainer’ to Get a Mortgage to Short Rates
Replies: 77
Views: 8745

Re: Siren song of increased stock allocation

Wasn't the siren song that lured sailors onto the rocks? Did you not anticipate there would be "corrections" like this? Don't be greedy and stick to rebalancing.
by Dandy
Tue Oct 14, 2014 11:04 pm
 
Forum: Investing - Help with Personal Investments
Topic: Siren song of increased stock allocation
Replies: 38
Views: 2891

Re: Gut Check on Health Plan Comparison

In health insurance you usually get what you pay for. Lower premiums usually mean you give something up. e.g. choice of doctors or hospitals? - which I consider key. We often let price be too much of a factor. Serious illness hopefully in not in your future but if it does coverage and choice of prov...
by Dandy
Tue Oct 14, 2014 5:30 pm
 
Forum: Personal Finance (Not Investing)
Topic: Gut Check on Health Plan Comparison
Replies: 5
Views: 689

Re: Health Insurance - Retiree questions

Buying health insurance is a difficult task. Price is important but you often get what you pay for. If you can afford it I would opt for a plan that allows you to choose any doctor or hospital and get some reimbursement. If you or a loved one get a serious illness you want the best available not the...
by Dandy
Tue Oct 14, 2014 5:20 pm
 
Forum: Personal Finance (Not Investing)
Topic: Health Insurance - Retiree questions
Replies: 12
Views: 1533

Re: Opinions on Montessori beyond the preschool years

Our kids didn't go there. My wife taught 4 year olds for about a dozen years. The feeling was that Montessori pushed academics a bit too much. Her school focused more on things like sharing, following instructions, waiting your turn and having fun - learning occurred more as an intentional by produc...
by Dandy
Tue Oct 14, 2014 5:08 pm
 
Forum: Personal Consumer Issues
Topic: Opinions on Montessori beyond the preschool years
Replies: 10
Views: 865

Re: Should your AA change based on World Events?

World events of the bad kind go on all the time. 50% invested in international is high for me but if you like it current world events shouldn't be an issue.
by Dandy
Tue Oct 14, 2014 10:17 am
 
Forum: Investing - Theory, News & General
Topic: Should your AA change based on World Events?
Replies: 22
Views: 1363

Re: Bill Sharpe on the 4% SWR rule (he thinks it's silly)

There is no set it and forget it approach. Every few years you need to assess your expenses, health and portfolio and see if adjustments need to be made. Many times I'm sure you could let it ride. But, if expenses, health and/or portfolio size are going the wrong way in a meaningful way - prudent ad...
by Dandy
Tue Oct 14, 2014 10:15 am
 
Forum: Investing - Theory, News & General
Topic: Bill Sharpe on the 4% SWR rule (he thinks it's silly)
Replies: 51
Views: 4609

Re: Relatively new here. What did you do in 2008/09

I just retired in 2008 timing couldn't have been worse and a daughter's wedding to boot. Was basically staying the course until Harry Reid said a large insurance company was going bankrupt. I had my pension, health insurance and most of my 401k in a Stable Value fund with a large insurance company. ...
by Dandy
Tue Oct 14, 2014 9:59 am
 
Forum: Investing - Help with Personal Investments
Topic: Relatively new here. What did you do in 2008/09
Replies: 106
Views: 6771

Re: Retired and end of month checking account balance?

I keep about 1 month's drawdown in checking as a cushion and usually if there is more than that I send it to my online savings account. The savings account is for vacations and other lumpy expenses that occur during the year. The reason for such a high cushion is that real estate and estimated taxes...
by Dandy
Mon Oct 13, 2014 4:26 pm
 
Forum: Personal Finance (Not Investing)
Topic: Retired and end of month checking account balance?
Replies: 21
Views: 1862

Re: Are Savings Bonds Considered Cash?

Dandy, Thank you for the thoughtful reply. The reason I'm caught up in this is because in rebalancing my portfolio I'm confused why people say the emergency fund fixed income (CD, high yield savings) should count as part of the investment portfolio. Is a portfolio your whole net worth or is it what...
by Dandy
Sun Oct 12, 2014 9:44 am
 
Forum: Investing - Help with Personal Investments
Topic: Are Savings Bonds Considered Cash?
Replies: 16
Views: 978

Re: Why choose a LifeStrategy Fund?

1. in the accumulation stage most people want to keep a fixed allocation for all or most of their time. As they near or enter retirement if they hold Life Strategy in their IRA they can move it to a Target Date fund if they prefer a declining equity allocation (to 30% in Target Retirement Income) an...
by Dandy
Sun Oct 12, 2014 8:56 am
 
Forum: Investing - Theory, News & General
Topic: Why choose a LifeStrategy Fund?
Replies: 41
Views: 3455

Re: Are Savings Bonds Considered Cash?

Why be concerned about whether they are cash or bonds - the key allocation is equities vs fixed income and EE bonds are fixed income (and so are CDs, savings accounts etc). Cash is literally dollars and coins. A lot depends on risk and how liquid the product is. EE bonds are less liquid than a check...
by Dandy
Sun Oct 12, 2014 8:43 am
 
Forum: Investing - Help with Personal Investments
Topic: Are Savings Bonds Considered Cash?
Replies: 16
Views: 978

Re: it will take me about 38 years to reach $1M at this rate

One way to look at it is you will be a lot better off than if you didn't start now. You have a couple of decades to plan for your retirement. e.g. live a bit more frugally now and add more to taxable savings. You need to take a hard look at your current situation. The earlier you cut expenses the bi...
by Dandy
Sat Oct 11, 2014 9:14 am
 
Forum: Investing - Help with Personal Investments
Topic: it will take me about 38 years to reach $1M at this rate
Replies: 25
Views: 3136

Re: Brokered CDs - is/why the rate higher than normal bank C

It seems pretty easy (quick, cheap) for the bank to sell one large CD to an investment firm like Vanguard rather then peddle CDs to individual customers. That could be at least one reason. Akin to a private placement bond with an insurance company. The bank is also assured (I believe) that there wil...
by Dandy
Sat Oct 11, 2014 8:58 am
 
Forum: Investing - Theory, News & General
Topic: Brokered CDs - is/why the rate higher than normal bank CDs
Replies: 14
Views: 1150

Re: Stable Income Fund vs. Total Bond Market

Both are good choices. I would own some of both. I might use the earnings in Stable Value (or future contributions )to buy Total Bond if/when interest rates rise and Total Bond slips a bit.
by Dandy
Fri Oct 10, 2014 10:45 pm
 
Forum: Investing - Help with Personal Investments
Topic: Stable Income Fund vs. Total Bond Market
Replies: 32
Views: 2173

Re: Market corrections and rebalancing band

I hate making large rebalancing moves. I did tighten up my bands and philosophy a bit in retirement. I believe I have enough for a secure retirement so my goal is more asset preservation than growth. My equity allocation goal is to get to 40% equities by age 70 (recently at about 42%) with 3+ years ...
by Dandy
Fri Oct 10, 2014 2:48 pm
 
Forum: Investing - Theory, News & General
Topic: Market corrections and rebalancing band
Replies: 71
Views: 4057

Re: Draw down taxable saving first?

It probably does. A lot depends on income tax bracket and mix of after tax, tax deferred size and the amount needed to supplement living expenses. My regret is that I didn't convert some of my TIRA to Roth during the lower income years in early retirement which started in 2008. I was more focused on...
by Dandy
Fri Oct 10, 2014 2:17 pm
 
Forum: Investing - Theory, News & General
Topic: Draw down taxable saving first?
Replies: 38
Views: 2393

Re: What was your initial AA and how has that worked out?

When I started work my Stable Value fund was paying 10+%. I put all my savings in that and ignored the two funds that I also could have invest in. In 1983 or so IRA were born and I tip toed into equity mutual funds. By then I had a decent amount in Stable Value. I took some of those surveys to deter...
by Dandy
Tue Oct 07, 2014 4:50 pm
 
Forum: Investing - Theory, News & General
Topic: What was your initial AA and how has that worked out?
Replies: 32
Views: 2494

Re: What should all treasury bond allocation look like?

I'll let others give you advice re Treasury bonds but just want you to note that a VG brokerage 10 year CD is paying 3.4% almost 1% more than a 10 year Treasury - both with a government guarantee. There are other pro and cons of each but you should think fixed income vs bonds when looking at your no...
by Dandy
Tue Oct 07, 2014 9:43 am
 
Forum: Investing - Help with Personal Investments
Topic: What should all treasury bond allocation look like?
Replies: 2
Views: 324

Re: Need Income - Wellesley Income or Wellington Fund

Just a note of caution - VG does an honorable job of closing off investing in funds rather than having them grow beyond their portfolio team's ability to invest properly -- especially compared to other fund companies. That said is it a signal? that the assets size is getting somewhat near the point ...
by Dandy
Tue Oct 07, 2014 9:31 am
 
Forum: Investing - Help with Personal Investments
Topic: Need Income - Wellesley Income or Wellington Fund
Replies: 8
Views: 1161

Re: 4% market drop causes huge drop in sentiment

It will be interesting to see the reactions when interest rates spike - lots of new bond investors and people think bonds are safe, if equity investors panic with a 4% drop for "risky" assets imagine what could happen when a "safe" investment drops 4%.
by Dandy
Mon Oct 06, 2014 8:42 am
 
Forum: Investing - Theory, News & General
Topic: 4% market drop causes huge drop in sentiment
Replies: 22
Views: 5104

Re: Why not a portfolio of equity index funds and CD's?

The vast majority of CDs I hold are in my TIRA. They are VG brokerage CDs which offer top notch yields from 5 yr, 7yr and 10 yr. They are targeted to held to maturity since I have larger allocations to short and intermediate bonds. As far as simplicity VG brokerage CDs are easy to buy, interest is c...
by Dandy
Mon Oct 06, 2014 8:33 am
 
Forum: Investing - Theory, News & General
Topic: Why not a portfolio of equity index funds and CD's?
Replies: 27
Views: 2639

Re: Why not a portfolio of equity index funds and CD's?

I'm a fan of CDs and have a decent allocation to a CD ladder as part of my fixed income allocation. In general, I don't like to put 100% in any product. Each fixed income product has pros and cons so I like more diversity. Also, CDs seem riskless but have subtle risks e.g. lag keeping up with inflat...
by Dandy
Mon Oct 06, 2014 7:42 am
 
Forum: Investing - Theory, News & General
Topic: Why not a portfolio of equity index funds and CD's?
Replies: 27
Views: 2639

Re: Buffett Has 100% Equities in his Pensions Funds

I'm not being sarcastic as I ask this question, but just curious, what would it take to really see that bonds are a losing proposition and abandon them and swallow hard and take short term risk in stocks for a better outcome in the future. I guess it depends on how short is short term and how sure ...
by Dandy
Sun Oct 05, 2014 1:15 pm
 
Forum: Investing - Theory, News & General
Topic: Buffett Has 100% Equities in his Pensions Funds
Replies: 39
Views: 2708
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