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Re: CSRS and SS, check my logic

OK, trying it one more time....JW I guess I did not understand that RMD and SS are treated differently for tax purposes. At 70, taking SS at 70: SS: $45K $41k would fit with PIA = $31k CSRS: $77K RMD: would be about $113K based on a value of $3.1M in the IRA If I start taking SS at 66 it would be $3...
by JW Nearly Retired
Thu Jul 31, 2014 3:20 pm
 
Forum: Investing - Help with Personal Investments
Topic: CSRS and SS, check my logic
Replies: 24
Views: 1274

Re: CSRS and SS, check my logic

I deleted my post after botching the math twice. :oops:
Will give it a rest for now.
JW
by JW Nearly Retired
Thu Jul 31, 2014 11:09 am
 
Forum: Investing - Help with Personal Investments
Topic: CSRS and SS, check my logic
Replies: 24
Views: 1274

Re: state income tax withheld from IRA distribution?

I don't understand why Vanguard can withhold tax for 24 states, but not for the others that have income taxes. I cannot imagine that the states would refuse to take money from Vanguard. Vanguard is already set up to withhold for some states, so why not offer the service for the others? Jeff I think...
by JW Nearly Retired
Wed Jul 30, 2014 12:30 pm
 
Forum: Personal Finance (Not Investing)
Topic: state income tax withheld from IRA distribution?
Replies: 44
Views: 1612

Re: CSRS and SS, check my logic

If I take the SS at 66, I will need to take less out of my IRA between 66 and 70. At 70, the RMD will be about $40K/yr above my expenses and will only get better or worse, depending on your perspective. Starting SS at 66 so as to take less out of your IRA between 66 and 70 might be a very bad thing...
by JW Nearly Retired
Wed Jul 30, 2014 12:13 pm
 
Forum: Investing - Help with Personal Investments
Topic: CSRS and SS, check my logic
Replies: 24
Views: 1274

Re: Was ready to pull plug on Janus..until

Can someone explain how the 2008 crash did not really hurt me with 100% in Janus stock funds..meaning today I'm still better off than I would have been with an allocation of bonds. Is it because it was just a 1 year event and a quick recovery? What's to explain? Stocks have fully recovered and then...
by JW Nearly Retired
Wed Jul 30, 2014 9:53 am
 
Forum: Investing - Help with Personal Investments
Topic: Was ready to pull plug on Janus..until
Replies: 66
Views: 3818

Re: Backdoor Roth question

Just to add one further clarification ......... a rollover IRA is a TIRA.
JW
by JW Nearly Retired
Wed Jul 30, 2014 9:07 am
 
Forum: Investing - Help with Personal Investments
Topic: Backdoor Roth question
Replies: 4
Views: 388

Re: state income tax withheld from IRA distribution?

Vanguard will not withhold income tax for Ohio. If I make an IRA withdrawal, I must make other arrangements to pay the tax. It is an inconvenience, and I have asked them to change the policy. So far, they have not. Jeff I can confirm Vanguard will withhold income tax for California...... but the ta...
by JW Nearly Retired
Wed Jul 30, 2014 8:59 am
 
Forum: Personal Finance (Not Investing)
Topic: state income tax withheld from IRA distribution?
Replies: 44
Views: 1612

Re: Please confirm my back door Roth understanding

It is easier to put deductible contributions into one traditional IRA and non-deductible contributions into another traditional IRA so that when he withdraws or converts, he can calculate the taxable part easier. I don't see why it would be easier? The 8606 form calculation of the taxable part will...
by JW Nearly Retired
Wed Jul 30, 2014 8:44 am
 
Forum: Investing - Help with Personal Investments
Topic: Please confirm my back door Roth understanding
Replies: 15
Views: 1150

Re: Please confirm my back door Roth understanding

If so, are there any problems or complications doing her tIRA-->Roth conversion, then doing a new $5500 non deductible IRA deposit and back dooring that into her Roth all in the same tax year? There are no limits to the conversion amounts or other complications. I would reduce this to 2 steps by ma...
by JW Nearly Retired
Tue Jul 29, 2014 5:39 pm
 
Forum: Investing - Help with Personal Investments
Topic: Please confirm my back door Roth understanding
Replies: 15
Views: 1150

Re: Please confirm my back door Roth understanding

You have it right except for one trivial detail. You won't need to open a "newly created" TIRA every year. Vanguard will keep the empty one open so you can just keep putting money into that.
JW
ps: and don't forget..... SEPs, SIMPLE, and rollover IRAs count as TIRAs.
by JW Nearly Retired
Tue Jul 29, 2014 3:56 pm
 
Forum: Investing - Help with Personal Investments
Topic: Please confirm my back door Roth understanding
Replies: 15
Views: 1150

Re: CSRS and SS, check my logic

Because of the size of her pension, she will not be eligible to take my SS pension when I die. I had always planned on waiting until 70 to take SS but when I did the math, it would take until I am into my 80's before the taking at 70 was advantageous for me. Since she won't get it anyway there is n...
by JW Nearly Retired
Tue Jul 29, 2014 2:19 pm
 
Forum: Investing - Help with Personal Investments
Topic: CSRS and SS, check my logic
Replies: 24
Views: 1274

Re: Do any boggleheads invest in individual companies?

Thanks for all the insightful and very helpful responses!! Boggleheads is very helpful and I am very glad I found it. I guess it would help if I told the secret companies I still own from inheritance - pretty simple it's only 4: Norfolk Southern (nsc), Dominion Resources (d), At & T (t), and Ve...
by JW Nearly Retired
Tue Jul 29, 2014 9:46 am
 
Forum: Investing - Theory, News & General
Topic: Do any boggleheads invest in individual companies?
Replies: 95
Views: 5106

Re: Dollar-Cost Averaging at Scottrade

The funds I'd like to invest are: Vanguard Total Stock Market Index Fund Admiral Shares (VTSAX; 0.05%) Vanguard Total International Stock Index Fund Admiral Shares (VTIAX; 0.14%) Does it make sense for me to pay $4 on transaction fees per month (at Scottrade) and get VTSAX & VTIAX or, invest in...
by JW Nearly Retired
Mon Jul 28, 2014 12:42 pm
 
Forum: Investing - Help with Personal Investments
Topic: Dollar-Cost Averaging at Scottrade
Replies: 11
Views: 509

Re: Poll: Has your AA changed in the last 18 months

Voted no. The market is always changing our AA but our target is still 60/40. I rebalanced to this about 8 months ago when we hit our max 65% stock band edge. The stock market would have to go up by another 15% or so before the portfolio would need rebalancing again. DW & I have no minimum stock...
by JW Nearly Retired
Mon Jul 28, 2014 9:08 am
 
Forum: Investing - Theory, News & General
Topic: Poll: Has your AA changed in the last 18 months
Replies: 58
Views: 3530

Re: Traditional vs Roth 401k when contributing the max

I expect that in retirement I would be content to spend $80k-$100k/year in today's dollars. Do you really mean "spend" that much? You are only grossing $100k now and saved $50k of it. Once you retire the saving ceases. Anyway, I just want to point out that somebody living on SS + signific...
by JW Nearly Retired
Mon Jul 28, 2014 8:21 am
 
Forum: Investing - Help with Personal Investments
Topic: Traditional vs Roth 401k when contributing the max
Replies: 6
Views: 725

Re: Geneological research for unclaimed property

At some point, I can just pay the 20 bucks or so to get an actual death certificate and see if it sheds more light than the record of the death certificate. For gosh sakes pay to get the death certificate. It should have reliable dates of birth/death, and the parents/spouse of the deceased and his ...
by JW Nearly Retired
Sat Jul 26, 2014 10:02 pm
 
Forum: Personal Consumer Issues
Topic: Geneological research for unclaimed property
Replies: 77
Views: 3395

Re: Have a million to transfer, thinking of doing 100% stock

I'm thinking of going for 100% equities, with a 60-40 split between Total U.S. and Total international. I know that some bonds are usually recommended, but consider this: I have no reasons to use this money for anything else. Emergency funds are not a problem, college funds are not a problem, debt ...
by JW Nearly Retired
Sat Jul 26, 2014 10:06 am
 
Forum: Investing - Help with Personal Investments
Topic: Have a million to transfer, thinking of doing 100% stocks
Replies: 38
Views: 3667

Re: Family member as Financial Advisor

IMO, it's best to leave the present $10k of IRA money where it is and put all future money into a Vanguard account. When Dad notices you are not investing with him any more say very sorry you felt the need to handle this yourself like a grownup, and ask for his forgiveness. That should come out bett...
by JW Nearly Retired
Fri Jul 11, 2014 9:22 pm
 
Forum: Investing - Help with Personal Investments
Topic: Family member as Financial Advisor
Replies: 35
Views: 2998

Re: How I look at $ in the real world vs my retirement accou

Anyways, since it's the first month that the money went into my 403b that meant that today, when I opened up Mint and saw that my balance is now ~$496 I had a realization that I lost $4 already. Of course, in the long run I will end up with much more than that. But it made me think about how differ...
by JW Nearly Retired
Fri Jul 11, 2014 12:56 pm
 
Forum: Personal Finance (Not Investing)
Topic: How I look at $ in the real world vs my retirement accounts
Replies: 45
Views: 5824

Re: What to do with 401K and 457 from old employer

In terms of my need to preserve back door Roth option or not, I want to make sure the $17,500 I am putting into my 401K pre-tax does not count toward my MAGI for Roth purposes. I've seen varied answers to that question and want to make sure. If that deferral amount is excluded from my income for Ro...
by JW Nearly Retired
Fri Jul 11, 2014 11:19 am
 
Forum: Investing - Help with Personal Investments
Topic: What to do with 401K and 457 from old employer
Replies: 12
Views: 846

Re: Delaying SS while working past age 70

This thread has covered the early/late SS issue exceptionally well. IMO, the only omission is the (large) effect of income taxes. I don't see any analysis of taxes impact here or in the Shoven & Slavov papers. I didn't read every word so please let me know if I've missed something. I'm married a...
by JW Nearly Retired
Wed Jul 09, 2014 10:19 pm
 
Forum: Personal Finance (Not Investing)
Topic: Delaying SS while working past age 70
Replies: 135
Views: 9918

Re: Worried about my parents' financial health

Appears unlikely there is anything that will convince him to invest sensibly. Will they have any other sort of income in retirement? Can't think of anything concrete you should do except do not for any reason entangle any of your own finances with theirs. Seems OK to send him a Bogle book or two but...
by JW Nearly Retired
Sat Jul 05, 2014 10:11 am
 
Forum: Investing - Help with Personal Investments
Topic: Worried about my parents' financial health
Replies: 10
Views: 1093

Re: Delaying SS while working past age 70

+1
Excellent comprehensive refs Bobcat!
JW
by JW Nearly Retired
Sat Jul 05, 2014 9:16 am
 
Forum: Personal Finance (Not Investing)
Topic: Delaying SS while working past age 70
Replies: 135
Views: 9918

Re: Just retired...any reason to move 401K to IRA?

What about costs? Do you know absolutely for sure what your expenses for hold those funds in your 401(k) are, compared to in a rollover IRA? This is a very good point that everyone should take seriously. Perhaps it's easier to check now, but some years ago I went to the point of zeroing out my cont...
by JW Nearly Retired
Fri Jul 04, 2014 10:35 pm
 
Forum: Investing - Theory, News & General
Topic: Just retired...any reason to move 401K to IRA?
Replies: 50
Views: 4945

Re: Delaying SS while working past age 70

You didn't mention taxes on SS. These will be large if you continue to work until age 70 and to be fair you can only invest the after tax portion of the payments. Sounded like you invested the whole thing? Also, did you look at the common strategy that lower earner collects at 66 and higher earner t...
by JW Nearly Retired
Fri Jul 04, 2014 6:36 pm
 
Forum: Personal Finance (Not Investing)
Topic: Delaying SS while working past age 70
Replies: 135
Views: 9918

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

Are those who include real estate/pensions/mortgages and other odd assets mentioned here really throwing all this into the AA = "Stock"%/"Bond"% you would report to us? More particularly do the "what is your AA" poll results include a lot of this stuff? I had no idea th...
by JW Nearly Retired
Fri Jul 04, 2014 4:09 pm
 
Forum: Investing - Theory, News & General
Topic: [Poll] Which do you include in Asset Allocation?
Replies: 41
Views: 2642

Re: Just retired...any reason to move 401K to IRA?

This is self serving advice because for the same account size Fidelity makes twice as much money on IRAs than on 401ks. (Source: Rollovers article July 2014 Money page 46.) Interesting. Can you add detail without trespassing on copyright? It's in the sub-section "Why you're a Catch" in th...
by JW Nearly Retired
Fri Jul 04, 2014 11:52 am
 
Forum: Investing - Theory, News & General
Topic: Just retired...any reason to move 401K to IRA?
Replies: 50
Views: 4945

Re: Just retired...any reason to move 401K to IRA?

My Fidelity guy says most people make the move from 401K to an IRA at retirement, maInly for a wider selection of options for investment. This may be an unusual fact, but my company's 401(k) plan offers exactly the type of index funds I am interested in. Am I missing a point? My former employer is ...
by JW Nearly Retired
Fri Jul 04, 2014 11:11 am
 
Forum: Investing - Theory, News & General
Topic: Just retired...any reason to move 401K to IRA?
Replies: 50
Views: 4945

Re: POLL: Are You Re-Balancing?

Not recently. Once last fall for the first time in years. I only high stocks side rebalance and a 60/40 changes slowly.
JW
by JW Nearly Retired
Fri Jul 04, 2014 10:21 am
 
Forum: Investing - Help with Personal Investments
Topic: POLL: Are You Re-Balancing?
Replies: 70
Views: 4975

Re: Having Doubts About My 60/40 Allocation

My view is that 80/20 would be better but 90/10 is OK when you are just getting started and don't have a ton of money at risk. Also, to keep from nourishing your market timing/performance chasing demons, don't set a bad precedent by making this change all at once. Do it slowly with new contribution ...
by JW Nearly Retired
Fri Jul 04, 2014 9:56 am
 
Forum: Investing - Help with Personal Investments
Topic: Having Doubts About My 60/40 Allocation
Replies: 43
Views: 3087

Re: Buyout Offer and Debt

I don't think they have much in savings, and they are living within their means now. They both have jobs (she full time, brother part time) but they have this debt. I know they must pay the minimum in income tax. I will ask him about his IRA's, as I know they are taking RMDs, or savings Was thinkin...
by JW Nearly Retired
Thu Jul 03, 2014 2:18 pm
 
Forum: Investing - Help with Personal Investments
Topic: Buyout Offer and Debt
Replies: 16
Views: 1188

Re: 401k: If parents dont need the $, do an aggressive AA

Both my parents are retired. They have a combined mid 6-figure 401k. Their pensions pay for all their expenses, and then some. Plus they also get social security, which is icing on the cake. The 401k will be mine when they both pass (which hopefully wont be for decades). I have no idea what their A...
by JW Nearly Retired
Thu Jul 03, 2014 10:29 am
 
Forum: Investing - Help with Personal Investments
Topic: 401k: If parents dont need the $, do an aggressive AA
Replies: 16
Views: 1105

Re: WSJ article on ROTH 401K's vs Traditional

If you are receiving SS, pension, dividends, interest, cap gains, rental income, part time work, i.e., whatever sort of taxable income you can imagine, then starting RMDs on top of this will make the RMD taxed at the marginal rate you had previously, and maybe the next higher one too. My RMD is all...
by JW Nearly Retired
Wed Jul 02, 2014 9:16 pm
 
Forum: Investing - Theory, News & General
Topic: WSJ article on ROTH 401K's vs Traditional
Replies: 48
Views: 4478

Re: WSJ article on ROTH 401K's vs Traditional

livesoft wrote:Actually, I think if other income is LT cap gains and qualified dividends, I think some of RMDs would not be taxed at marginal rates.

Once again, one needs to "run the numbers".

Yes, those income categories could create exceptions to my too broad statement. I crossed them out.
JW
by JW Nearly Retired
Wed Jul 02, 2014 8:21 pm
 
Forum: Investing - Theory, News & General
Topic: WSJ article on ROTH 401K's vs Traditional
Replies: 48
Views: 4478

Re: WSJ article on ROTH 401K's vs Traditional

If you are receiving SS, pension, dividends , interest, cap gains , rental income, part time work, i.e., usual taxable income in retirement, then starting RMDs on top of this will make the RMD taxed at the marginal rate you had previously, and maybe the next higher one too. My RMD is all being taxed...
by JW Nearly Retired
Wed Jul 02, 2014 7:48 pm
 
Forum: Investing - Theory, News & General
Topic: WSJ article on ROTH 401K's vs Traditional
Replies: 48
Views: 4478

Re: Bad Advice from Schwab re "Mega Backdoor Roth IRA?"

Michael, here is the opinion of Kaye Thomas who is a tax-attorney if I'm not mistaken. Now, if you are Michael Kitces, you have probably read this stuff already and just have a different opinion. :D http://fairmark.com/retirement/roth-accounts/roth-conversions/isolating-basis-for-roth-conversion/ba...
by JW Nearly Retired
Wed Jul 02, 2014 4:00 pm
 
Forum: Investing - Help with Personal Investments
Topic: Bad Advice from Schwab re "Mega Backdoor Roth IRA?"
Replies: 48
Views: 4360

Re: 401(k) In-Plan Roth Conversion of After-Tax Money

Question for sub-account doubters............. have you ever looked at your 401k/403b statement? Doesn't it have a section with a table listing your three sub-account contributions and balances that looks like: ...................Year-to-date Contributions..............Total Market Value Before-Tax....
by JW Nearly Retired
Wed Jul 02, 2014 10:48 am
 
Forum: Investing - Help with Personal Investments
Topic: 401(k) In-Plan Roth Conversion of After-Tax Money
Replies: 65
Views: 4128

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

Stocks and real bonds only included in my 60/40 AA.

I do consider pension/SS as pseudo-bonds in applying a formula that suggests my 60/40 target number, but that's something else. :P
JW
by JW Nearly Retired
Tue Jul 01, 2014 4:58 pm
 
Forum: Investing - Theory, News & General
Topic: [Poll] Which do you include in Asset Allocation?
Replies: 41
Views: 2642

Re: Old Stock Certificate Question

An inheritance is not a gift. The inheritor gets a step-up in cost basis ........ to the value on the date the former owner died. Or in some cases 6-months later.
JW
by JW Nearly Retired
Tue Jul 01, 2014 3:43 pm
 
Forum: Investing - Help with Personal Investments
Topic: Old Stock Certificate Question
Replies: 11
Views: 738

Re: After TAX 403b contributions should I do it?

No issues with backdoor roth, contribute to that, but didn't take advantage for first 2 years either, but now comfortable with it but it is only 5500 not 20000 like with mega roth It doesn't have to be $20000. You contribute up to your pre-tax maximum of $17,500 and then any contributions beyond th...
by JW Nearly Retired
Tue Jul 01, 2014 12:43 pm
 
Forum: Investing - Help with Personal Investments
Topic: After TAX 403b contributions should I do it?
Replies: 59
Views: 1843

Re: POLL: Mortgage as a negative bond

Clearly not a negative bond. Correct me if I'm mistaken, but I think Bogleheads usually count real estate holdings (REITS) as equities. So if you want to count house equity it should be a stock.............. i.e., the appraised value is a positive stock and the mortgage balance is a negative stock. JW
by JW Nearly Retired
Tue Jul 01, 2014 9:52 am
 
Forum: Personal Finance (Not Investing)
Topic: POLL: Mortgage as a negative bond
Replies: 89
Views: 2926

Re: Advice on redesigning my parents' retirement portfolio

JW Nearly Retired, Yes, their real estate could be sold or rented. I agree, it is by far their greatest asset. They live there and don't wish to sell or rent it, so I'm not sure how to include it when determining their asset allocation, other than a "if something bad happens, we could sell or ...
by JW Nearly Retired
Mon Jun 30, 2014 9:51 pm
 
Forum: Investing - Help with Personal Investments
Topic: Advice on redesigning my parents' retirement portfolio
Replies: 16
Views: 1095

Re: Advice on redesigning my parents' retirement portfolio

They also have some real estate that is worth over a million. But since they don't want to sell or rent it, it basically acts as an expense from having to pay property taxes. So I'm not including that in the calculation. They pay the taxes out of their salary income. This million dwarfs their other...
by JW Nearly Retired
Mon Jun 30, 2014 9:01 pm
 
Forum: Investing - Help with Personal Investments
Topic: Advice on redesigning my parents' retirement portfolio
Replies: 16
Views: 1095

Re: After TAX 403b contributions should I do it?

I am not aggravated with you at all. In fact this is the only place to discuss these strategies. Yes, technically speaking I am allowed to take money out to traditional ira and roll it over to my roth, I don't have traditional ira only roth so no basis would incur, I still choose not to take that r...
by JW Nearly Retired
Mon Jun 30, 2014 5:45 pm
 
Forum: Investing - Help with Personal Investments
Topic: After TAX 403b contributions should I do it?
Replies: 59
Views: 1843

Re: Advice on redesigning my parents' retirement portfolio

My parents are 64 and 65, and are both still working. They are looking to retire in 2 or 3 years. They are married, live in California, and file taxes jointly. Their combined unadjusted salary is $83,000. That puts them in 25% federal tax bracket, and 9.30% plus $2,191.48 California tax bracket. Ha...
by JW Nearly Retired
Mon Jun 30, 2014 2:58 pm
 
Forum: Investing - Help with Personal Investments
Topic: Advice on redesigning my parents' retirement portfolio
Replies: 16
Views: 1095

Re: Optimal Strategy for IRA/non-IRA accounts (facing RMDs)

Many people in a lower bracket from 60 to 70 have followed the practice of converting a portion of their tIRA to a Roth every year, and paying the tax owed out of taxable savings. This keeps the same amount of money in retirement accounts but the Roth portion has no RMDs and is never taxed. JW ps: t...
by JW Nearly Retired
Mon Jun 30, 2014 12:20 pm
 
Forum: Investing - Theory, News & General
Topic: Optimal Strategy for IRA/non-IRA accounts (facing RMDs)
Replies: 4
Views: 387

Re: Best use of inheritance for retirement saving?

Thank you JW, that is an interesting suggestion I had not considered. I do consider myself fairly risk-tolerant, though I admit that putting so much away at once does concern me a bit. I have so far adhered to a dollar-cost averaging strategy, and maxing out the 401K seems to be in opposition to th...
by JW Nearly Retired
Mon Jun 30, 2014 8:57 am
 
Forum: Investing - Help with Personal Investments
Topic: Best use of inheritance for retirement saving?
Replies: 18
Views: 2341

Re: After TAX 403b contributions should I do it?

Do you really think the 403b administrator will keep everything straight? You have pre-tax contributions, pre-tax gains, after-tax contributions, after-tax gains, etc. Are there separate accounts for pre-tax vs after-tax? What about all the paperwork when you do roll everything over to an IRA or an...
by JW Nearly Retired
Sun Jun 29, 2014 9:13 pm
 
Forum: Investing - Help with Personal Investments
Topic: After TAX 403b contributions should I do it?
Replies: 59
Views: 1843

Re: Help for my sister

Here's a brief overview. My sister, 62 & single would like to retire. She has $330,000 in liquid assets. No additional assets or liabilities. Her SS will be $800.00/month. She's lived with her BF for over a decade & they have a solid & sustainable relationship. Her total expenses, in th...
by JW Nearly Retired
Sun Jun 29, 2014 6:44 pm
 
Forum: Investing - Help with Personal Investments
Topic: Help for my sister
Replies: 21
Views: 1911

Re: Best use of inheritance for retirement saving?

I would pay off the two highest student loans. Secondly, increase your contribution to the 401k to the maximum of $17,500 per year. You probably could not afford maxing it previously but now you can. Spend whatever amount you need from the inheritance account to make up for the reduction of your tak...
by JW Nearly Retired
Sun Jun 29, 2014 6:15 pm
 
Forum: Investing - Help with Personal Investments
Topic: Best use of inheritance for retirement saving?
Replies: 18
Views: 2341
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