Bogleheads.org

Now I don't know If I should put off SS till 66 or take it at 62 at a lower amount due to... "the $32K and $44K base amounts are not indexed to inflation." Holding off gives me a larger SS check but gets me over the "base amounts" quicker because of inflation. I think the increa...

I just realized that there is another good reason to consider a Roth conversion. Most of us have not looked closely at RMDs after age 70. It turns out that the RMD in dollars can increase substantially in later years. If an IRA does very well over time one's tax bracket might get pushed up more tha...

I just realized that there is another good reason to consider a Roth conversion. Most of us have not looked closely at RMDs after age 70. It turns out that the RMD in dollars can increase substantially in later years. If an IRA does very well over time one's tax bracket might get pushed up more than...

Question... If the taxes for the conversion(s) are paid from the IRA at the time of the conversion(s) is that amount (taxes) also taxed as regular income for that/those years? All withdrawals from a Traditional IRA other than after-tax contributions are taxed regardless of how the money is used. If...

As I am in the 15% tax bracket, I am able to take LT cap gains in my taxable account at 0% tax consequence, as long as I stay within the 15% tax bracket, no? If my taxable income (line 43) exceeds the 15% tax bracket due to LT cap gains my taxes are increased because of it. I just ran that thru Tax...

What about converting more than the 15% space? That is stuff that would be taxed in the 25% bracket, where I am estimating I will be after I start taking my own social security? Does that make sense at all? Or do effects of compounding make that a losing proposition? I'd suggest modeling your situa...

Question... If the taxes for the conversion(s) are paid from the IRA at the time of the conversion(s) is that amount (taxes) also taxed as regular income for that/those years? All withdrawals from a Traditional IRA other than after-tax contributions are taxed regardless of how the money is used. If...

Here are some comments I posted in another thread. Note that future and unknown tax rates will determine how much a Roth Conversion might pay off. That is why some people maintain both a Traditional IRA and Roth IRA. I modeled two cases of Roth Conversions in a spreadsheet and one can learn a lot. C...

The benefits of a Roth conversion are not really known until years later since we don't know future tax rates. Many people just hedge their bets and convert a portion of their Traditional IRA. Holding an IRA of both types may be an excellent strategy. I modeled two cases of Roth Conversions in a spr...

I'd first check the duration on both the GNMA fund and the Short Term Bond fund. GNMA funds can have a fairly short duration at times. The duration is actually lowered because of the principal payments, and in addition the fund manager may select shorter maturities. Unfortunately, the duration of an...

In many cases, your IRA custodian can set up automatic RMDs which also includes using the correct RMD divisor. I'd suggest taking the RMD no later than the first half of December just in case something unexpected comes along. It's even possible for the stock exchanges to be closed under certain cond...

Many people choose to take their first RMD in the same year they turn 70 1/2. Otherwise, you will have two RMDs in the following year. That can affect your tax bracket. The April 1st date only applies once if you choose to wait until the year after turning 70 1/2. Normally the RMD must be taken by t...

This is the so called Fed model and it is a failure at prediction. Larry Swedroe writes a lot about this. One wonders if a more accurate model would even be possible. In reviewing Common Sense on Mutual Funds, the table on page 38 shows that the PE effect can be quite large. The other factors are t...

Thanks Svensk and RM for your replies. I also noticed the relative valuation on the chart during the great 1982-2000 bull market. That was an interesting time because interest rates were extremely high at the start of the period followed by a multi-decade decline. Today bond yields are at the opposi...

The latest T. Rowe Price Report includes a chart on page 5 showing relative valuations based on Earnings Yield and the 10 Year Treasury Yield. http://individual.troweprice.com/public/Retail/xStaticFiles/Spring2013PriceReport.pdf I'm wondering if this relative value is really significant, or whether ...

I have been taking advantage of the 0% bracket for qualified dividends and capital gains, and try my best to avoid ordinary income in taxable accounts. Everyone should review their tax situation very carefully and get a feel for the marginal tax rate for each income category. In my case, additional ...

In regards to ETFs versus open-ended mutual funds, could an open-ended fund possibly be safer than an ETF in a financial crisis? There are four basic types of ETFs that include UIT, Open-Ended Fund, VIPERS, and HOLDRS. http://www.investorguide.com/article/11779/not-all-etfs-are-created-equal-four-ty...

Morningstar is an excellent resource for comparing fund performance and I believe they have accurate total return data with reinvestment of all distributions. Comparing Vanguard Total Stock Market Index Admiral (VTSAX) with Fidelity Spartan Total Market Index Advantage (FSTVX), the compounded return...

This thread has been discussing three upcoming changes to Vanguard Target Retirement funds, and includes comments on the new hedged international bond fund, the short term inflation protected securities fund, and the money market fund. Wouldn't replacing the money market fund with a short term bond ...

I never in my wildest dreams expected this AA from Vanguard. One issue is that Vanguard employs a number of financial planners and each planner might provide a different recommendation. It's quite possible that the low 20% in bonds is related to the very low interest rates today and the expectation...

If possible you should request that the check be made out to "Vanguard FBO.." Thanks for the reminder on the check made out to the IRA custodian FBO owner. Since I have some time I plan to explore Rollover Central a little more. To date I have not seen what options they provide for non-ta...

Thanks Brian, Mike, Oilburner, and CaBob for the help. I do have the option of getting the rollover check myself and forwarding it to Vanguard or any other firm. As mentioned, it is very easy to open the new account especially if you already have an existing account at the firm. I'd just prefer an a...

I own a business (that I built from scratch) over the past 10 years that now employs 100 people. A large amount of my money has gone into reinvesting in the business and the majority of my net worth is wrapped up in it too. For the last 2 years the business has really taken off and we are well past...

Here is an update with potentially good news. I may be able to roll assets to Vanguard after all. The third party site is now up and running, and in one section it says "You may choose to roll your account to an IRA with a provider that is not offered through Rollover Central." I'm not 100...

Thanks ieee488 and Default User BR. I agree that handling the rollover myself is really best. The main concern is that the check takes a full week to arrive which can be a bit uncomfortable. I guess I'm hoping someone will recommend the third party provider for one reason or another. In fact, there ...

From your own description, the low-cost providers are not on the list, and it will likely generate fees for the provided choices. Thanks for your comments and I agree regarding personal information. Many of the brokerages can be ruled out for various reasons but there are several good choices such ...

Just got my federal and state taxes completed thru my CPA firm and the amounts owed are pretty large. I know that is a good problem to have, but I feel the need to try to reduce them next year. Other than charitable contributions (I already do a bunch of those each year), does anyone have any good ...

Has anyone used a third party provider made available by your 401K plan to set up and process an IRA rollover? If so, I'd be interested in any feedback or comments. My plan will soon have this capability and I believe the third party is the company listed below. Everything can be done online from th...

Here is the iShares iBoxx $ HY ETF (HYG) over the past 5 days. The chart makes an excellent point but note that the drop in NAV on April 1 was the result of the fund going ex-dividend. Here is a comment in reply to the original post. Compare Vanguard High Yield with similar funds from other fund gr...

Thanks David.

I just discovered that there are four basic types of ETFs and they are a little different (UIT, Open End, VIPERS, HOLDRS).

http://www.investorguide.com/article/11 ... -from-igu/

Thanks David for the help. That's a good point on the Vanguard ETF percentage in relation to the open ended share classes in any given fund. If nothing else, ETF redemptions in-kind could work at eliminating the lowest cost basis shares. However, I just realized that the open ended fund could have b...

Many of us have read that ETFs may be more tax efficient than open ended funds when it comes to capital gains distributions. I believe the key factor in this is the ability of an ETF to reduce their holdings in the lowest cost basis securities held in the portfolio. These securities can be passed al...

Duckie - Thanks for the Fidelity link which was the exact information I had been looking for earlier. It takes some time to get familiar with a new site. The Spartan Index funds do look like excellent possibilities with low expenses. With the less than exciting outlook for bonds in an improving econ...

Thanks all for the help. I would prefer Vanguard in many ways but also feel that I should diversify in terms of firm and custodian. Fortunately, I have a number of years to make a decision although I might do the rollover well in advance. I also had the thought that retirees probably add much more t...

My 401K plan has a new policy and will close the account in the year after the owner reaches age 70 1/2. Any required RMD will be processed and the balance will then be mailed to the owner for rollover to an IRA. I'm wondering if anyone has come across this kind of policy or can suggest why they mig...

I think net worth implies the value before any future taxes, but the after-tax value is also of interest. Consider the difference between a large Roth IRA and a large Traditional IRA or 401K of the same dollar amount. A taxable account might only be worth 60-80% of the value of the tax free account....

Thanks all for your comments. Here is some information on the United States one dollar bill from Wikipedia. http://en.wikipedia.org/wiki/United_States_one-dollar_bill The bills are 72.3% cotton and 27.7% linen. It could very well be that my bill did shrink for some reason. There is some information ...

I recently noticed that one specific dollar bill dated 2009 in my wallet was shorter than all the rest. The normal specification for a dollar bill is approximately 6.14" x 2.61". After careful measurement of several bills, I found that the bill in question is about 0.10" shorter in wi...

Once the first bond reaches its 15 year of existence, I am going to cash in using the following method: year one - 1/34 of outstanding value year two - 1/32 of outstanding value year three - 1/30 of outstanding value ... year 18 - remaining balance The suggested schedule may go beyond the 30 year p...

Delayed retirement credits are first paid in the following January. Thanks for the explanation. If I understand this, one can apply for benefits after full retirement age and start receiving benefits often the next month. The amount would go up the following January based on delayed retirement cred...

One of the things about SS that I have learned to appreciate during the last couple of years is how flexible SS is. Excellent point and I agree. Waiting could also be a benefit to those that might be hit with Medicare surcharges. The threshold is not all that high for single taxpayers. Here is anot...

P.S. you have to understand the meaning of "not increase benefits" means. Your monthly benefits go up, but you don't live long enough to collect more* than if you had just started a little earlier. Thanks sscritic and mickeyd for your replies. I now understand the point the author was try...

Here is an article discussing periods where waiting to take Social Security may not increase the benefit. They cite age 62 through age 63 and 11 months, and age 65 and 4 months through age 66 and 8 months. These numbers are for those with full benefits at age 66. http://blogs.marketwatch.com/encore/...

You must enter the website some other way because I am given no such option that I can see. I'll look into clearing cookies. One does need to start without a cookie from Vanguard. You will then be given options, and at that point you can force the use of security questions on every log-in. With 50 ...

Note that it is possible to force the use of security questions on every log-in. How do you reset that setting once set? They give you the option at each log-in. It comes up when they ask whether you are using a public computer. Note also that one can delete cookies and that should force the use of...

What I worry about is how easy it is to reset your password at various financial institutions. When someone can get a new password for your account by answering some non-secure "security questions", that's where the problem lies. Has anyone experimented with incorrect answers to security ...

A tax loss is often more valuable when used to offset ordinary income. The limit has been $3000.00 per year.

If that is the case, one could defer taking the capital gains and use a portion of the loss each year to offset ordinary income.

If the fund isn't listed at all, does that mean none of the dividends are qualified? High-Yield Corp, for example. The Vanguard table that I referenced was provided to show Estimated Capital Gains. Note the following statement in the Bond fund section: "Bond funds not listed here aren't expect...

I would also look carefully at the expected distributions from the mutual funds. Some fund groups provide information on any expected short term capital gains which come through as non-qualified dividends. One could reduce exposure to the tax impact of those dividends if selling before the distribut...

Money market funds would also be required to re-price their shares at $100.00 per share Thanks for passing that along. One key issue would be whether the funds could maintain an NAV of $100.00 most of the time, or whether NAV would drop to $99.99 or lower, or increase to $100.01 or higher, a reason...