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Re: Do you "Tax Adjust" your Asset Allocation (Pre vs Roth,

"About 50-50" is good enough for me. And in fact I have "about 50%" in equities. I have a number of different types of account, and I hold more than just "stocks and bonds." Trying to make any more exact calculations of the effective AA would just be a waste of my time.
by Garco
Mon Jul 21, 2014 10:56 am
 
Forum: Investing - Theory, News & General
Topic: Do you "Tax Adjust" your Asset Allocation (Pre vs Roth, etc)
Replies: 75
Views: 2930

Re: POLL: Do you have a dedicated REIT allocation?

No way ever. Don't need REITS for any reason I can understand. I do own TIAA Real Estate Account (TREA), which, as Nisi mentions above, is a different animal.
by Garco
Fri Jul 18, 2014 9:33 am
 
Forum: Investing - Theory, News & General
Topic: POLL: Do you have a dedicated REIT allocation?
Replies: 123
Views: 6811

Re: Cash allocation in a portfolio

Why does the poll stop at a 5% cash allocation? Am I the only one who believes that cash is a worthy asset class in its own right? I don't think it is, but there is nothing wrong with deciding otherwise, and in that case the allocation could be more than 5%. The "dry powder" metaphor is e...
by Garco
Tue Jul 08, 2014 10:18 am
 
Forum: Investing - Theory, News & General
Topic: Cash allocation in a portfolio
Replies: 42
Views: 3584

Re: Cash allocation in a portfolio

I have three types of cash. (1) Stable value funds that serve as ballast in my qualified investment portfolios (401k etc.), but is not immediately liquid, in return for which I earn about 4% interest. (2) Cash-cash, about 1.5 years, intended as a reserve for current and future consumption , essentia...
by Garco
Mon Jul 07, 2014 8:08 pm
 
Forum: Investing - Theory, News & General
Topic: Cash allocation in a portfolio
Replies: 42
Views: 3584

Re: Individual Asset Volatility and Portfolio Rebalancing

As a mostly slice-and-dicer (with mostly index funds), I don't put rebalancing bands around individual holdings. I do put them around asset classes (stocks, real estate, bonds...). I worry less about volatility (noise) that way. It's good enough, and leaves some room for judgment about how to carry ...
by Garco
Sun Jul 06, 2014 6:12 pm
 
Forum: Investing - Help with Personal Investments
Topic: Individual Asset Volatility and Portfolio Rebalancing
Replies: 9
Views: 387

Re: How are you doing through the first half of 2014?

Just to join the crowd. +6.2% ytd from beginning of year (6.0% w/o contributions). My port is 50% equities. Since I'm about to go off payroll (i.e., retire), new contributions will soon stop.
by Garco
Sat Jul 05, 2014 11:24 am
 
Forum: Investing - Theory, News & General
Topic: How are you doing through the first half of 2014?
Replies: 91
Views: 9300

Re: AA: Jump in or glide in with Inheritance Cash?

@utvolfan. I am in a somewhat similar position to yours. On verge of retirement, with about two-thirds of my retirement money in qualified plans (401k's, 457b's, etc.). The other third is in taxable investments and cash (about 60/40 investments/cash). We didn't "accumulate" most of the tax...
by Garco
Sat Jul 05, 2014 1:12 am
 
Forum: Investing - Help with Personal Investments
Topic: AA: Jump in or glide in with Inheritance Cash?
Replies: 23
Views: 1999

Re: Are You Re-Balancing?

I expect to rebalance later this year in connection with taking RMD's -- basically taking some weight from equities. I'm not exactly holding my breath but I have more than one task to accomplish.
by Garco
Thu Jul 03, 2014 10:09 pm
 
Forum: Investing - Help with Personal Investments
Topic: POLL: Are You Re-Balancing?
Replies: 70
Views: 4944

Re: [Poll] Which do you include in Asset Allocation?

Stocks, bonds, real estate (TIAA Real Estate Account), cash. I think cash can be strategically allocated in an investment account. I think derivatives can be included, though I don't own any. I exclude loans and SS, though the former can also be used strategically as investment vehicles -- but that'...
by Garco
Wed Jul 02, 2014 10:25 am
 
Forum: Investing - Theory, News & General
Topic: [Poll] Which do you include in Asset Allocation?
Replies: 41
Views: 2630

Re: SS Gap Until 70?

Looking to bridge the gap untill SS at age 70 (starting at age 60)at which time SS and a small Pension will account for 85% Expensises. My situation is as follows: 1.3 Million Portfolio Small Non Adjusted Pension $14500 Yearly Health Care Provided My question centers around if my portfolio can with...
by Garco
Sat Jun 28, 2014 7:20 pm
 
Forum: Personal Finance (Not Investing)
Topic: SS Gap Until 70?
Replies: 29
Views: 2416

Re: Poll: Retirement tax bracket?

Yes the survey question and the "brackets" were very confusing. I am retired now but was not retired in 2011. While my income in 2011 was almost entirely earned (payroll), my income now is from withdrawals from my tax-deferred accounts and from earnings on my taxable investments. However, ...
by Garco
Mon Jun 23, 2014 8:18 pm
 
Forum: Investing - Theory, News & General
Topic: Poll: Retirement tax bracket?
Replies: 24
Views: 2632

Re: Slice and dice and tilting the market

In my main tax deferred account, I use SD, with about 65% LC and 35% Extended Market. This year I reduced the tilt from what had been 40% Extended Market. I do not tilt on the value dimension. I have only about 28% international, so not overweighted there. 20% of my international is EM. ADDED: My su...
by Garco
Mon Jun 23, 2014 1:40 pm
 
Forum: Investing - Theory, News & General
Topic: Slice and dice and tilting the market
Replies: 14
Views: 1034

Re: Portfolio Question: Feel we're at a crossroad in life

To the good advice offered here, I'll just add that a house isn't a one-time purchase of a product with a depreciating value (like a car). You should at least calculate the annual costs of maintenance and improvements (remodeling, etc.), not to mention property taxes. I'll also add that though you a...
by Garco
Sun Jun 22, 2014 10:03 am
 
Forum: Investing - Help with Personal Investments
Topic: Portfolio Question: Feel we're at a crossroad in life
Replies: 29
Views: 1933

Re: Canceling out: SPIA plus Term Life Insurance?

Just to complicate this discussion a little bit, you can also think of an SPIA not for an individual but for a couple -- a 2-life annuity. In this case the survivor would get some fraction (up to 100%) of the annuity amount for as long as s/he lives. If I buy an SPIA that's how I will do it, with 50...
by Garco
Sun Jun 22, 2014 12:45 am
 
Forum: Investing - Theory, News & General
Topic: Canceling out: SPIA plus Term Life Insurance?
Replies: 3
Views: 417

Re: Why does Vanguard sit on your money for a week ?

I had similar experience with Fidelity. Electronically transferred large sum from my bank (credit union), but although the money was withdrawn from my bank the same day it took 3 full business days after the order date (and transfer from my bank) before I could access it at Fidelity -- to trade or w...
by Garco
Fri Jun 20, 2014 12:01 pm
 
Forum: Investing - Theory, News & General
Topic: Why does Vanguard sit on your money for a week ?
Replies: 14
Views: 1519

Re: How compelling is the TIAA Real Estate fund?

Thanks, ogd. Talk about mumbling, that makes zero sense. But enjoy your day.
by Garco
Fri Jun 20, 2014 9:54 am
 
Forum: Investing - Help with Personal Investments
Topic: How compelling is the TIAA Real Estate fund?
Replies: 85
Views: 4457

Re: How do I calculate my capital gains tax?

As a practical solution, since I use Turbotax (TT), it is a cinch to let TT "retrieve" the information about my taxable holdings from my Fidelity account. (TT does the same transfer with several other brokerage houses.) I do cross-check numbers, but the transfer of information to my tax fo...
by Garco
Thu Jun 19, 2014 10:56 pm
 
Forum: Investing - Theory, News & General
Topic: How do I calculate my capital gains tax?
Replies: 7
Views: 644

Re: How compelling is the TIAA Real Estate fund?

ogd: How would you suggest TIAA price the TREA ? I don't know -- try to infer a price from comparable sales and the movement of REITs? It's their problem, and until they solve it with better pricing or much more draconian liquidity restrictions, they have a broken product. I'm sure it's not easy, b...
by Garco
Thu Jun 19, 2014 8:54 pm
 
Forum: Investing - Help with Personal Investments
Topic: How compelling is the TIAA Real Estate fund?
Replies: 85
Views: 4457

Re: How compelling is the TIAA Real Estate fund?

@ogd: The prices (NAV) of TREA do change every day, just not by much, since they're not driven by the everyday emotional shifts of the market for REITs. If you think about it, you'd consider your home investment also to be very steady in value because you don't price it every day. But if, just for ...
by Garco
Thu Jun 19, 2014 3:15 pm
 
Forum: Investing - Help with Personal Investments
Topic: How compelling is the TIAA Real Estate fund?
Replies: 85
Views: 4457

Re: How compelling is the TIAA Real Estate fund?

Somebody above said they've held TREA for 30 years and maybe just broke even. TREA was started in 1995. If you put $10,000 into TREA then and held it even through the crash of 2008-9, you'd now have $31,000. Of course that's nominal, not inflation adjusted. But with such an adjustment (see BLS Infla...
by Garco
Thu Jun 19, 2014 12:05 pm
 
Forum: Investing - Help with Personal Investments
Topic: How compelling is the TIAA Real Estate fund?
Replies: 85
Views: 4457

Re: "Vanguard Retirement Nest Egg Calculator"

According to this calculator, I am going to be rich rich rich after I die. Seriously, it's a toy (and by definition toys are fun!) but isn't that sensitive to how we live or how we die (e.g., if we end up with long-term care costs). I like Fidelity's retirement income planner much more. Both that pl...
by Garco
Thu Jun 19, 2014 11:21 am
 
Forum: Investing - Theory, News & General
Topic: "Vanguard Retirement Nest Egg Calculator"
Replies: 13
Views: 2363

Re: FT: The myth of small-cap outperformance

It's a myth that small cap beats large cap after the 1st year of a bull market? From January 2, 2010 through December 31, 2013, i.e., 4 years, the total return on VINIX (SP500 index) was: 80.28%. In the same time interval, the total return on VIEIX (extended market index) was: 101.81%. This is a fig...
by Garco
Sun Jun 15, 2014 12:53 am
 
Forum: Investing - Theory, News & General
Topic: FT: The myth of small-cap outperformance
Replies: 42
Views: 3732

Re: Article: 60/40 produces "same" return with ~half the ri

Choosing an optimal asset allocation really needs to be related to one's age, one's expected working life (age of retirement), and one's tolerance for volatility. (I am not conflating volatility with risk.) But you really do have to have a plan about what you will do when the market takes a deep div...
by Garco
Mon Jun 09, 2014 2:23 am
 
Forum: Investing - Theory, News & General
Topic: Article: 60/40 produces "same" return with ~half the risk
Replies: 46
Views: 5471

Re: possible to have TOO MUCH in 401k account?

Folks, 1) Is it possible for a person to work at the same place for 20 to 30 years?? Based on the study that I seen, people going to change job on the average 10 times before they retire. Hence, it is unlikely that a person can have too much tied up in 401K unless they do not rollover to IRA when t...
by Garco
Fri Jun 06, 2014 7:43 pm
 
Forum: Investing - Help with Personal Investments
Topic: possible to have TOO MUCH in 401k account?
Replies: 54
Views: 7216

Re: In what ways does a retired person's portfolio differ?

The only thing I can add to this informative exchange is "Thanks." There are many routes to a good financial situation in retirement; and often the route chosen doesn't matter that much, if you know where you are now and where you're trying to go; or it depends significantly on luck. I'm o...
by Garco
Fri Jun 06, 2014 11:04 am
 
Forum: Investing - Theory, News & General
Topic: In what ways does a retired person's portfolio differ?
Replies: 88
Views: 7941

Re: possible to have TOO MUCH in 401k account?

Sunnyday's example misses my point. Yes, spend the first 30 years putting money into regular tax-sheltered 403(b) or 401(k) accounts. This ensures that in retirement, you are able to withdraw funds to fill the 10%, 15%, and 25% brackets using $$$ that would have been taxed at 25% and 28%. But THEN,...
by Garco
Thu Jun 05, 2014 11:34 am
 
Forum: Investing - Help with Personal Investments
Topic: possible to have TOO MUCH in 401k account?
Replies: 54
Views: 7216

Re: TIAA Traditional RA/GSRA Question

@13thstreet. You should realize that in TIAA's terminology, you aren't guaranteed 3.5% in your RA. You are guaranteed 3.0% (minimum guarantee), and any amount above that is the so-called "additional amount," which can go up or down in future. Thus, for example, while any money you put into...
by Garco
Thu Jun 05, 2014 12:17 am
 
Forum: Investing - Help with Personal Investments
Topic: TIAA Traditional RA/GSRA Question
Replies: 11
Views: 642

Re: Delaying Social Security benefits - information from NAS

That's an odd reply. If the guy had filed for SS at 62 and collected more than the small fraction that he did collect, he'd have some of that money in his estate to benefit others in his family. The uncollected SS is money "lost" to him (since he didn't have it to spend) and his family (si...
by Garco
Sun Jun 01, 2014 2:04 pm
 
Forum: Investing - Theory, News & General
Topic: Delaying Social Security benefits - information from NASI
Replies: 31
Views: 2180

Re: Are hybrid cars a good idea yet?

I've owned a 2010 Ford Fusion hybrid since mid-2009. It was very well put together. I've had zero problems with it. I don't drive huge miles, now with about 48 thousand. I expect to keep it at least a couple more years. I did all the calculations about cost vs. fuel efficiency when I bought the car...
by Garco
Sun Jun 01, 2014 11:17 am
 
Forum: Personal Finance (Not Investing)
Topic: Are hybrid cars a good idea yet?
Replies: 105
Views: 8071

Re: Are hybrid cars a good idea yet?

I've owned a 2010 Ford Fusion hybrid since mid-2009. It was very well put together. I've had zero problems with it. I don't drive huge miles, now with about 48 thousand. I expect to keep it at least a couple more years. I did all the calculations about cost vs. fuel efficiency when I bought the car ...
by Garco
Sun Jun 01, 2014 12:31 am
 
Forum: Personal Finance (Not Investing)
Topic: Are hybrid cars a good idea yet?
Replies: 105
Views: 8071

Re: Delaying Social Security benefits - information from NAS

File for SS at 62? At 70? I took a middle course and filed at 66; spouse took spousal at same time (no file and suspend). Happy I did this to clear the financial decks for retirement. Reinvested some of the SS money indirectly into tax-deferred accounts by maxing out 457b contributions from salary.
by Garco
Sat May 31, 2014 1:07 pm
 
Forum: Investing - Theory, News & General
Topic: Delaying Social Security benefits - information from NASI
Replies: 31
Views: 2180

Re: Holding the same fund in taxable and non-taxable account

I hold some mutual funds in a tax advantaged account and the "identical" ETF's in a taxable account. E.g., VGTSX and VXUS; VIEIX and VXF; PTTRX and BOND. I don't think these would be subject to a wash sale rule. Or would they?
by Garco
Sat May 31, 2014 11:43 am
 
Forum: Investing - Help with Personal Investments
Topic: Holding the same fund in taxable and non-taxable accounts
Replies: 11
Views: 919

Re: Help with daughter's 401K

Another vote for the OP's suggested simplified portfolio, and the proposed ratios. My one question is the selection of TIAA-CREF international. From my observation and personal investing experience, this fund is rather volatile even relative to its class. I recommend that you consider instead the us...
by Garco
Thu May 29, 2014 12:15 pm
 
Forum: Investing - Help with Personal Investments
Topic: Help with daughter's 401K
Replies: 9
Views: 1010

Re: When did you tell your children how much you had amassed

Our kids never lacked for anything they needed or really wanted. We paid for their private college educations, among other things. They knew, however, that we lived relatively modestly. No McMansions. One car. There was absolutely no reason to detail our wealth. Until very recently, as we approached...
by Garco
Mon May 19, 2014 3:07 pm
 
Forum: Investing - Help with Personal Investments
Topic: When did you tell your children how much you had amassed
Replies: 135
Views: 10907

Re: Changes in Work 403b Options - Help Picking New Funds

@KatieSSS: These are beneficial to your options. I agree with centrifuge41 about buying some fraction of VG extended market to accompany SP500. This also gives you option, if you wish, to overweight the extended market (e.g., to 30%+). Not sure this really matters much in current environment in part...
by Garco
Mon May 19, 2014 1:22 pm
 
Forum: Investing - Help with Personal Investments
Topic: Changes in Work 403b Options - Help Picking New Funds
Replies: 6
Views: 416

Re: What is the best brand of 3 ton air conditioner & furnac

We installed Bryant A/C and gas furnace a few years ago. Works great and very high efficiency.
by Garco
Thu May 15, 2014 9:48 pm
 
Forum: Personal Consumer Issues
Topic: What is the best brand of 3 ton air conditioner & furnace?
Replies: 46
Views: 2581

Re: Request advice on mother's investments.

In terms of current income, I assume you're calculating her RMD from her IRA. At her age (78) she would be required to withdraw 5.2% of her ~$60,000.
by Garco
Thu May 15, 2014 9:41 pm
 
Forum: Investing - Help with Personal Investments
Topic: Request advice on mother's investments.
Replies: 15
Views: 1031

Re: Pre-tax advantage account vs Taxable Account

Originally you posted Option 2: Your employer will allow you to invest $17,500 in a taxable account and match an amount of $x I thought you might have meant that for some unusual reason, you employer would only match contributions to a Roth 401(k) or 403(b). Now that you've clarified that it's a 40...
by Garco
Thu May 15, 2014 12:34 pm
 
Forum: Investing - Help with Personal Investments
Topic: Pre-tax advantage account vs Taxable Account
Replies: 17
Views: 923

Re: Pre-tax advantage account vs Taxable Account

1. Employer match does not count against your $17,500 annual contribution to a 401k or 457b. Yes it does. At least in a government 457b, the combined contributions by employee and employer can not go over $17,500. Unless there is some type of exception out there. But, that is how my plan works and ...
by Garco
Thu May 15, 2014 9:02 am
 
Forum: Investing - Help with Personal Investments
Topic: Pre-tax advantage account vs Taxable Account
Replies: 17
Views: 923

Re: Pre-tax advantage account vs Taxable Account

To the OP. Just a few points of clarification of the preceding discussion. 1. Employer match does not count against your $17,500 annual contribution to a 401k or 457b. 2. If you have both a 401k and a 457b sponsored by your employer, you can contribute $17,500 to each one in the same year, i.e., for...
by Garco
Wed May 14, 2014 8:46 pm
 
Forum: Investing - Help with Personal Investments
Topic: Pre-tax advantage account vs Taxable Account
Replies: 17
Views: 923

Re: 401k to an IRA

Depending on state the 401k can provide better protection against bankruptcy or judgments. Would you elaborate on the advantages of 401k vs IRA in providing better protection against bankruptcy or judgments? In my state, since a 401k or 403b is the main pension that many people have, the state secu...
by Garco
Mon May 12, 2014 1:49 pm
 
Forum: Investing - Theory, News & General
Topic: 401k to an IRA
Replies: 11
Views: 572

Re: Husband's 403b. Help Me Understand TIAA CREF, Please!

You also need to be aware that if you invest in TIAA Traditional, you need to move any funds out of the account over 10 years. This is not true. It is a myth that keeps getting repeated. As House Blend said, you have to know the restrictions that apply to you, not the restrictions that apply to som...
by Garco
Mon May 05, 2014 11:57 pm
 
Forum: Investing - Help with Personal Investments
Topic: Husband's 403b. Help Me Understand TIAA CREF, Please!
Replies: 15
Views: 1131

Re: Investments as Inheritence

ajmbpak: How you handle this may well depend on the amounts of (unrealized) gains and losses on your inherited investments, as well as on what the individual investments are. If you just want to simplify everything by liquidating the investments and putting the money elsewhere, I wouldn't blame you....
by Garco
Mon May 05, 2014 9:56 pm
 
Forum: Investing - Help with Personal Investments
Topic: Investments as Inheritence
Replies: 20
Views: 1267

Re: Retirement Savings - Gross vs. Net Savings

I can think of two good reasons to make it 15% of gross. (1) The doctrine of "pay yourself first" works a lot better if you never see that money in your checking account but it automatically goes "off the top" into tax-deferred savings. (2) By the OP's example, 15% of gross is a ...
by Garco
Mon May 05, 2014 10:13 am
 
Forum: Investing - Theory, News & General
Topic: Retirement Savings - Gross vs. Net Savings
Replies: 14
Views: 1646

Re: Investments as Inheritence

The funds that were sold, i.e., "exchanged" for other funds (or cash) are something you will have to account for in your next tax filing, taking your long-term gains (or losses) from the value of the equities at the date of death of your grandfather. I recently had a mixed lot of inherited...
by Garco
Sun May 04, 2014 2:24 pm
 
Forum: Investing - Help with Personal Investments
Topic: Investments as Inheritence
Replies: 20
Views: 1267

Re: Real estate vs total stock market

Given the fact that real estate basically keeps up with inflation, why would anyone take $1mm and put it into real estate as an "investment" vs buying total stock market fund? I grew up in Canoga Park (a place you are no doubt familiar with, given your screen name). My parents bought a sm...
by Garco
Sun May 04, 2014 12:27 pm
 
Forum: Investing - Theory, News & General
Topic: Real estate vs total stock market
Replies: 44
Views: 3434

Re: Investments as Inheritence

Thanks. I guess my "tax" concern was whether I would be taxed a higher rate as these have been held by myself for only a short time (<1 yr) even though my grandfather had them for years, or would they be treated as long term capital gains for me even though I have had them for a short tim...
by Garco
Sun May 04, 2014 11:58 am
 
Forum: Investing - Help with Personal Investments
Topic: Investments as Inheritence
Replies: 20
Views: 1267

Re: How long to pay off your mortgage?

I did not make paying off my mortgage a priority until I approached retirement. I was content with the original 30 year conventional mortgage. When it was paid off in 2006 I was happy to be done with it. I was also happy that I hadn't fallen for a refinance plan that might have brought some cash to ...
by Garco
Fri Apr 25, 2014 3:43 pm
 
Forum: Personal Finance (Not Investing)
Topic: How long to pay off your mortgage?
Replies: 66
Views: 15150

Re: Savings Rate what do you include?

Ok currently I'm saving $40 for a dinner with my wife next week. But a true savings rate is money piled up that is not already allocated to be used this year and is to be used in years to come. And my subjective ("what do YOU include") argument is that people usually keep funds already sp...
by Garco
Fri Apr 25, 2014 10:18 am
 
Forum: Investing - Theory, News & General
Topic: Savings Rate what do you include?
Replies: 69
Views: 5437

Re: Please explain a 3% SWR to me

It's useful to have a list of fallback options or adjustments that people have identified on this thread and others if the initial assumed SWR seems threatened by extreme events. 1. SPIAs: at any time during the withdrawal period, including from year 1. This is a way to assure that you won't run out...
by Garco
Thu Apr 24, 2014 11:59 am
 
Forum: Investing - Theory, News & General
Topic: Please explain a 3% SWR to me
Replies: 92
Views: 22594
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