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by IlliniDave
Mon May 25, 2015 6:55 pm
Forum: Personal Finance (Not Investing)
Topic: Friends/Family that don't invest!
Replies: 76
Views: 6943

Re: Friends/Family that don't invest!

Have you encountered friends/family that don't save for retirement and when you ask why they respond with something like "how do you know you won't lose it?" I understand they may not want risk, however even investing in bonds (VBTLX for example) they would assume almost 0 risk and make s...
by IlliniDave
Mon May 25, 2015 6:44 pm
Forum: Personal Finance (Not Investing)
Topic: When is it safe to share financial details with gf, future wife
Replies: 53
Views: 4280

Re: When is it safe to share financial details with gf, future wife

I didn't read the entire thread, but I would say to hold off discussing it in detail until you are formally engaged. Sounds like you already know you are reasonably compatible with her financially. And it really shouldn't be about whose is bigger than whose, more of a discussion of how you want to p...
by IlliniDave
Mon May 25, 2015 2:50 pm
Forum: Personal Finance (Not Investing)
Topic: A different way of calculating when to retire
Replies: 26
Views: 2418

Re: A different way of calculating when to retire

Interesting idea, especially if "enjoying wealth" is one of the main tenets of person's retirement. Do folks need to be reminded that "enjoying wealth" is possible without being retired? Not really, the OP already said he's doing that. He was positing criteria for retirement so ...
by IlliniDave
Mon May 25, 2015 2:48 pm
Forum: Personal Finance (Not Investing)
Topic: A different way of calculating when to retire
Replies: 26
Views: 2418

Re: A different way of calculating when to retire

And in response to those who think spending more won't make you happier: fair point, but not having to worry about money at all (including how one spends it, not just how one earns it or whether one has enough to live a minimalist lifestyle) seems to me to be the ultimate luxury. Penny pinching in ...
by IlliniDave
Mon May 25, 2015 2:27 pm
Forum: Personal Finance (Not Investing)
Topic: A different way of calculating when to retire
Replies: 26
Views: 2418

Re: A different way of calculating when to retire

Interesting idea, especially if "enjoying wealth" is one of the main tenets of person's retirement. Seems this criteria could eventually get you to a point where ongoing savings have minimal impact on future wealth. For me, early retirement is more about enjoying time than money, so such a...
by IlliniDave
Mon May 25, 2015 5:55 am
Forum: Investing - Theory, News & General
Topic: Stemikger "Volatility is far from synonymous with risk."
Replies: 53
Views: 2813

Re: Stemikger "Volatility is far from synonymous with risk."

It's an interesting discussion. I've never been comfortable with equating risk with volatility (i.e., standard deviation). I have an especially hard time with ideas like risk-adjusted returns. Maybe it's because standard deviation is usually computed at very short time intervals (months, I think) an...
by IlliniDave
Fri May 22, 2015 10:06 am
Forum: Personal Finance (Not Investing)
Topic: Career Advice: Follow "Passion" or Follow the Money?
Replies: 73
Views: 4153

Re: Career Advice: Follow "Passion" or Follow the Money?

I'll go with a paraphrase of Mike Rowe's advice: chase opportunities, prioritize the financially prudent course, not your passions...but always carry your passions with you. In your case you're choosing between two perfectly viable paths to making a living, so you're not his target audience in that....
by IlliniDave
Fri May 22, 2015 5:09 am
Forum: Investing - Theory, News & General
Topic: Market Cap and Value
Replies: 46
Views: 2222

Re: Market Cap and Value

Nedsaid: Oh my gosh. My secret is out. Toto has pulled back the curtain and the mighty Nedsaid is just a man bellowing into a microphone and pulling some levers. Yep, I pretty much eye-ball it. I also take a look at market sentiment. I have admitted to "investing by feel." I am sure that ...
by IlliniDave
Thu May 21, 2015 5:46 pm
Forum: Investing - Theory, News & General
Topic: Market Cap and Value
Replies: 46
Views: 2222

Re: Market Cap and Value

Nedsaid: Oh my gosh. My secret is out. Toto has pulled back the curtain and the mighty Nedsaid is just a man bellowing into a microphone and pulling some levers. Yep, I pretty much eye-ball it. I also take a look at market sentiment. I have admitted to "investing by feel." I am sure that ...
by IlliniDave
Wed May 20, 2015 8:01 pm
Forum: Investing - Theory, News & General
Topic: The BIG problem with the S&P 500 index?
Replies: 37
Views: 6003

Re: The BIG problem with the S&P 500 index?

What the "market" is, is dollars. So the more of the market dollars you include the better your sampling of the market. I have some "500 Index" in my 401 so I can rebalance in my 401 without killing tax loss harvesting potential in my Total Stock Market Index on the taxable side....
by IlliniDave
Wed May 20, 2015 12:48 pm
Forum: Personal Finance (Not Investing)
Topic: Ways to fund an early retirement?
Replies: 40
Views: 2376

Re: Ways to fund an early retirement?

Thank you all for the help! I have a lot to dig through and I appreciate the comments. One other question for those who relied at least in part on taxable accounts: did you contribute occasional lump sums, or did you do regular (say monthly) contributions? Putting aside the dollar cost averaging di...
by IlliniDave
Wed May 20, 2015 11:19 am
Forum: Personal Finance (Not Investing)
Topic: Ways to fund an early retirement?
Replies: 40
Views: 2376

Re: Ways to fund an early retirement?

I max out my tax-advantaged space then contribute to taxable investments until just short of it starting to hurt. I'll be downsizing my home when the time comes too, the spare equity will be shoveled into taxable. I'm strongly considering SEPP from my 401 right away. The biggest key for me was not i...
by IlliniDave
Wed May 20, 2015 11:08 am
Forum: Personal Finance (Not Investing)
Topic: How much does social security factor into your retirement income?
Replies: 161
Views: 9925

Re: How much does social security factor into your retirement income?

No bravado here. I arguably won't need it, but it absolutely figures significantly into my age 70+ income. $35K+ per year is good money!! It will almost double my income.
by IlliniDave
Wed May 20, 2015 3:56 am
Forum: Investing - Theory, News & General
Topic: Rick Ferri Launching A Robo Advisory
Replies: 12
Views: 2850

Re: Rick Ferri Launching A Robo Advisory

Seems like a good way for the newest of investors to get the ball rolling with some sort of a plan/process before they really reach the point in life where individual/personal advice is worth the cost. To me 0.25% seems like a lot to charge for that given the implication is that it's just plugging i...
by IlliniDave
Tue May 19, 2015 8:37 pm
Forum: Investing - Theory, News & General
Topic: Let's hear your Dave Ramsey success stories
Replies: 71
Views: 10369

Re: Let's hear your Dave Ramsey success stories

I don't know, maybe I am not really following Dave's advice. But it was nice to read the book, read the success stories, and have steps that gave me goals and hope (even if I did modify the steps a bit). It's all common sense. A lot of it didn't really apply to me since I wasn't the one who ran up ...
by IlliniDave
Tue May 19, 2015 6:20 am
Forum: Personal Finance (Not Investing)
Topic: How do Bogleheads (in general) plan to finance their healthcare for later life?
Replies: 34
Views: 3552

Re: How do Bogleheads (in general) plan to finance their healthcare for later life?

My plan is to be an early retiree. My health is pretty decent so far. I plan to start an ACA HDHP plan and begin to fund an HSA. I'm looking at going the SEPP route with my 401k (or IRA if I roll it over). That would give me a slight excess of "income", which I would direct into the HSA up...
by IlliniDave
Tue May 19, 2015 3:28 am
Forum: Investing - Theory, News & General
Topic: What's so great about simplicity?
Replies: 117
Views: 8425

Re: What's so great about simplicity?

Not to sound overly trite, but simple is, well, simple. Not everyone enjoys an extra degree of challenge in keeping their investments in order. And I don't think there's a lot of evidence to support the idea that complexity systematically brings better results. Some of us, me included, enjoy adding ...
by IlliniDave
Fri May 15, 2015 5:21 am
Forum: Personal Finance (Not Investing)
Topic: Am I a Millionaire???
Replies: 53
Views: 6344

Re: Am I a Millionaire???

Since you are essentially talking joint assets, but using the singular pronoun, I'd say you are half way there. I don't have a problem counting the value of one's home in one's net worth. I do (actually rather a conservative estimate of what I'd net on a sale). I don't count vehicles myself--if you ...
by IlliniDave
Fri May 15, 2015 5:02 am
Forum: Investing - Theory, News & General
Topic: Too late to invest in Health Care Fund?
Replies: 56
Views: 4478

Re: Too late to invest in Health Care Fund?

I stuck my 2015 backdoor Roth money into this fund. The Roth account is my "play space" where I exercise my urge to try and be clever. I don't expect anything spectacular in the short/medium term. Over the long haul I'm just hoping for somewhat different behavior than the other odds/ends I...
by IlliniDave
Thu May 14, 2015 3:42 pm
Forum: Investing - Theory, News & General
Topic: Your Safety Net
Replies: 31
Views: 3662

Re: Your Safety Net

Seems like that would work for some folks. I'm on the cusp of early retirement and don't intend to do anything quite like that. I do have sort of a bucket strategy that helped me determine my overall AA, but it does not include cash. I do keep a 1 yr emergency fund as part of my household finances, ...
by IlliniDave
Thu May 14, 2015 3:56 am
Forum: Investing - Help with Personal Investments
Topic: Looking for input on investing a windfall
Replies: 14
Views: 1952

Re: Looking for input on investing a windfall

Very sorry for your loss. I agree with the prior poster that there is no need to be in a big hurry. It's okay to leave the money in cash for some additional time while you continue to learn more about personal investing. It is difficult to provide specific thoughts not knowing how much of a windfall...
by IlliniDave
Mon May 11, 2015 12:12 pm
Forum: Personal Finance (Not Investing)
Topic: Philosophies of frugality.
Replies: 60
Views: 5801

Re: Philosophies of frugality.

Frugality is not a synonym for misery. In a sense, frugality has its roots in self-respect--in general we give up part of our allotment in this life in exchange for money. So we should be careful to ensure that what we do with the money has a positive impact on our quality of life, so that our time ...
by IlliniDave
Mon May 11, 2015 11:53 am
Forum: Investing - Theory, News & General
Topic: Poll: Increasing international equities
Replies: 70
Views: 5566

Re: Poll: Increasing international equities

I'm increasing slightly, through new purchase (split between bonds, total international ex-us, and E/M). In a sense it is 'staying the course' because the shift in AA is part of the plan.
by IlliniDave
Mon May 11, 2015 3:48 am
Forum: Investing - Theory, News & General
Topic: Skeptical of consistent dividend growth
Replies: 18
Views: 1629

Re: Skeptical of consistent dividend growth

If earnings are not growing neither dividends nor share price will offer much total return growth. Some companies are consistently profitable and well-run, but just not positioned for indefinite growth of the business (plowing too much earnings into the company is futile). Others are more able to gr...
by IlliniDave
Fri May 08, 2015 12:22 pm
Forum: Personal Finance (Not Investing)
Topic: Do Updates to Home Increase Market Value?
Replies: 32
Views: 2173

Re: Do Updates to Home Increase Market Value?

I don't have much of value to add to this thread. Just wanted to thank all the participants. It's been immensely timely and helpful--answered a whole mouthful of questions before I could even ask them (I too am getting ready to sell my home and being encouraged to list it at what I felt was a price ...
by IlliniDave
Thu May 07, 2015 4:30 pm
Forum: Investing - Theory, News & General
Topic: McNabb op ed - possible 8% cash requirement
Replies: 33
Views: 2992

Re: McNabb op ed - possible 8% cash requirement

I don't like the sound of this--it punishes successful funds by stripping investors of 8% of their returns. That's almost adding an additional 0.48% ER to a fund making 6%.

Low cost investing will be a game of hunting around for smaller funds. Would cut the 3-fund strategy off at the knees maybe.
by IlliniDave
Tue May 05, 2015 7:31 am
Forum: Investing - Theory, News & General
Topic: Vanguard: The Problem of World Domination?
Replies: 21
Views: 2759

Re: Vanguard: The Problem of World Domination?

I think it's the buy and hold/low volatility aspect that will have more of an effect than indexing per se. Any buy and hold investor, index or not, removes a number of shares from the market, sometimes for decades. But if more people move away from picking towards holding, the pool of acting traders...
by IlliniDave
Tue May 05, 2015 6:49 am
Forum: Investing - Theory, News & General
Topic: Source for return standard deviation as function of AA
Replies: 5
Views: 369

Source for return standard deviation as function of AA

Does anyone know a convenient source to find the standard deviation of historical returns for various AA increments of US stock/bond portfolios. I used to have once somewhere and have lost it. Thanks.
by IlliniDave
Mon May 04, 2015 11:33 am
Forum: Personal Finance (Not Investing)
Topic: HSA contribution Strategies for early/semi-retired person
Replies: 5
Views: 509

Re: HSA contribution Strategies for early/semi-retired person

Thanks, definitely some things to think about. Seems like once I get on the HDHP it makes nothing but sense to fund the account as much as I can up until medicare. If I decide to go the SEPP route, I wind up with a little more income than I think I need, so it would seem I can pay the taxes on the S...
by IlliniDave
Mon May 04, 2015 7:51 am
Forum: Personal Finance (Not Investing)
Topic: HSA contribution Strategies for early/semi-retired person
Replies: 5
Views: 509

HSA contribution Strategies for early/semi-retired person

Long story short, it looks like my professional career will be winding down in the next 1-2 years. I currently do not have an HDHP plan, and hence no current HSA. Once I stop working full time I'll be purchasing through the ACA exchange. I'm considering some of the HSA-eligible plans. I'll be 51 lat...
by IlliniDave
Sun May 03, 2015 8:01 pm
Forum: Investing - Theory, News & General
Topic: Reverse Glide Path
Replies: 14
Views: 875

Re: Reverse Glide Path

I might wind up on such a path, though it won't be any kind of deliberate thing. I'm intending to use a variant of LMP with "extra" assets invested with my kids's ages in mind. In time most of those assets will wind up in taxable accounts, so I plan for minimal transacting and only modest ...
by IlliniDave
Sun May 03, 2015 7:43 pm
Forum: Investing - Theory, News & General
Topic: Pfau, Kitces, & Target-Date Fund glide paths
Replies: 29
Views: 2654

Re: Pfau, Kitces, & Target-Date Fund glide paths

From what I've seen of their work, it's somewhat analogous to a liability matching scheme, although if I recall correctly it's designed more as an antidote to sequence of return risk. Maybe I don't recall correctly, but I didn't think they advocated an aggressive buildup of stock over time. It's mor...
by IlliniDave
Thu Apr 30, 2015 10:07 am
Forum: Personal Finance (Not Investing)
Topic: Spendy spouse
Replies: 110
Views: 10736

Re: Spendy spouse

That's a tough one. I tried many things, still wound up divorced. Extreme disparity in financial goals was not the whole cause, but a big part of it. I think behind it all was divergent long-term life goals, and the day-to-day handling of money reflected that. There was also a power dynamic to it--d...
by IlliniDave
Thu Apr 30, 2015 5:57 am
Forum: Investing - Theory, News & General
Topic: RE Social security being taxed--new chart by Scott Burns
Replies: 41
Views: 4682

Re: RE Social security being taxed--new chart by Scott Burns

For planning purposes I just assume all of my SS is taxable as ordinary income along with everything else. That way I don't stress over these marginal tax rates. Once I hit 70 and start SS, I can't really say "no" to whatever my taxable income will be as it will be comprised of RMD + Pens...
by IlliniDave
Wed Apr 29, 2015 4:24 pm
Forum: Investing - Theory, News & General
Topic: RE Social security being taxed--new chart by Scott Burns
Replies: 41
Views: 4682

Re: RE Social security being taxed--new chart by Scott Burns

For planning purposes I just assume all of my SS is taxable as ordinary income along with everything else. That way I don't stress over these marginal tax rates. Once I hit 70 and start SS, I can't really say "no" to whatever my taxable income will be as it will be comprised of RMD + Pensi...
by IlliniDave
Wed Apr 29, 2015 7:01 am
Forum: Investing - Theory, News & General
Topic: IBD: How Does Your Nest Egg Compare To Most Americans'?
Replies: 14
Views: 3668

Re: IBD: How Does Your Nest Egg Compare To Most Americans'?

The numbers seem pretty consistent with data I've seen in the Census Bureau's Statistical Abstract, so I'd guess they are reasonably accurate. Hanging around here it's pretty easy to feel woefully unprepared while still being well into that top 14%. I'm beginning to think more-and-more that I'm &quo...
by IlliniDave
Tue Apr 28, 2015 7:27 am
Forum: Investing - Theory, News & General
Topic: Who's holding cash?
Replies: 86
Views: 6490

Re: Who's holding cash?

Occasionally I'll have a little cash build up in a MM pending investment at a convenient time, but I don't consider it part of my invested assets until it's used to by something with a reasonable potential of a positive real internal return. I also keep a fraction of what I consider my rainy day fun...
by IlliniDave
Mon Apr 27, 2015 1:28 pm
Forum: Investing - Theory, News & General
Topic: Income estimate too optimistic with financial engines ?
Replies: 13
Views: 929

Re: Income estimate too optimistic with financial engines ?

My employer's 401k has FE available as an option for those who want to purchase the service. Whenever I log in a get a projection of retirement income that's quite high, but the assumptions they use do not fit my situation even remotely, so I ignore it. Ironically, I get a "red light" that...
by IlliniDave
Mon Apr 27, 2015 6:24 am
Forum: Personal Finance (Not Investing)
Topic: Anyone Manually Manage Quicken?
Replies: 46
Views: 2270

Re: Anyone Manually Manage Quicken?

I only use Quicken to track my expenses and keep tabs of the various "sub accounts" I use as sinking funds and such. I do the entries manually. In that regard it's also a resource for verifying bank statements and whatnot, though not the be-all, end-all. I use a spreadsheet to track data r...
by IlliniDave
Sat Apr 25, 2015 7:02 am
Forum: Personal Finance (Not Investing)
Topic: Hypothetical "Can he pull the plug?" [Retire early]
Replies: 39
Views: 3633

Re: Hypothetical "Can he pull the plug?"

He's flexible and looks forward to the possibility of trying out a variety of part-time occupations for the opportunity to learn things, though he'd prefer to have the financial freedom to focus on volunteer activities. From a pure math standpoint, you're fine with the targeted spending pattern, bu...
by IlliniDave
Sat Apr 25, 2015 6:26 am
Forum: Personal Finance (Not Investing)
Topic: Hypothetical "Can he pull the plug?" [Retire early]
Replies: 39
Views: 3633

Re: Hypothetical "Can he pull the plug?"

Thanks, everyone! Just to clarify, the plan under discussion would be to ride out the present assignment until it's conclusion (the 6-18 months in question). The decision point is there. I am not entirely sure what all of my colleagues options are, but mine appear to be either to transfer/relocate t...
by IlliniDave
Fri Apr 24, 2015 3:47 pm
Forum: Personal Finance (Not Investing)
Topic: 2 million dollar mistake meeting with MIL's financial guy
Replies: 37
Views: 9659

Re: 2 million dollar mistake meeting with MIL's financial gu

Kudos to you for having the wherewithal to see through it, and taking the time to examine everything. Sadly many people would not, and would pay a steep price for it.
by IlliniDave
Fri Apr 24, 2015 11:48 am
Forum: Personal Finance (Not Investing)
Topic: Hypothetical "Can he pull the plug?" [Retire early]
Replies: 39
Views: 3633

Re: Hypothetical "Can he pull the plug?"

The unknowns such as health and health care costs are the wild cards but they apply to everyone working or not. And the majority retire with much less than this. Both of those are true. But I think I'm kinda weird (hopefully not pathological). If I look at that data in the statistical abstract the ...
by IlliniDave
Fri Apr 24, 2015 11:42 am
Forum: Personal Finance (Not Investing)
Topic: Hypothetical "Can he pull the plug?" [Retire early]
Replies: 39
Views: 3633

Re: Hypothetical "Can he pull the plug?"

.... question is, in your opinion, is this guys situation viable should he opt to pull the plug? For much of the world's population, your situation is not just viable, it's downright enviable. You are being given a gift. Time, health, money. And freedom on top of it. In your shoes, I would travel a...
by IlliniDave
Fri Apr 24, 2015 11:36 am
Forum: Personal Finance (Not Investing)
Topic: Hypothetical "Can he pull the plug?" [Retire early]
Replies: 39
Views: 3633

Re: "Assuming" could be a mistake.

Say further his employer has told him that his position will be eliminated in the next 6-18 months. He has not been given a termination notice yet. He assumes there will no severance package that will greatly enhance his situation if it comes to that, and no early retirement incentives. If were the...
by IlliniDave
Fri Apr 24, 2015 11:14 am
Forum: Investing - Theory, News & General
Topic: What rate of return do you use when planning for retirement?
Replies: 59
Views: 4871

Re: What rate of return do you use when planning for retirem

I really don't do much accumulation modeling, but when I do I use 3.5%. I do a lot more looking at the distribution years, and there I use the same notional value of 3.5% (real) for a baseline. I stress test down to 0%. I do a lot less in the Monte Carlo realm than I once did, but what I was doing t...
by IlliniDave
Fri Apr 24, 2015 11:06 am
Forum: Investing - Theory, News & General
Topic: Age in Bonds Poll
Replies: 72
Views: 3938

Re: Age in Bonds Poll

I said "don't follow" but tend to agree with the principal behind it--that it is often a good idea to increase bonds as one gets older. I just don't adhere to a formula that has my age as an input.
by IlliniDave
Fri Apr 24, 2015 11:01 am
Forum: Investing - Theory, News & General
Topic: International Stock Poll: Emerging vs Developed Ratio
Replies: 55
Views: 2796

Re: International Stock Poll: Emerging vs Developed Ratio

My international is somewhere between 20-30% of my stock allocation, within that 20-30% it's split pretty equally, maybe 60/40 developed international/emerging market. I've got a total international index fund that has some of both, plus a smaller amount in an EM fund. So 60/40 is just a ballpark.
by IlliniDave
Fri Apr 24, 2015 10:54 am
Forum: Personal Finance (Not Investing)
Topic: Hypothetical "Can he pull the plug?" [Retire early]
Replies: 39
Views: 3633

Re: Hypothetical "Can he pull the plug?"

If health care is going to be a significant expense (I know family might be $20K a year, what is single, $13K or something, wild guess) I think you likely do not have enough for comfort. This plan seems to have little room for a significant market down turn, health issue, or other unexpected large ...

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