Search found 1445 matches

by JustinR
Sat May 08, 2021 11:03 pm
Forum: Investing - Theory, News & General
Topic: Is it time to rethink automatic reinvestment of dividends in a taxable account?
Replies: 43
Views: 6481

Re: Is it time to rethink automatic reinvestment of dividends in a taxable account?

It's optimal to rebalance with dividends anyway, so turn off the automatic reinvestment.
by JustinR
Sat May 08, 2021 11:01 pm
Forum: Investing - Theory, News & General
Topic: Understanding cost basis to optimize taxes
Replies: 10
Views: 1286

Re: Understanding cost basis to optimize taxes

Just make the switch.

Your broker will have all the cost basis info for covered shares. For non-covered shares, they'll be grouped into a single lot with one cost.

The only records you'll need is to confirm for yourself if the broker's info is accurate, if you want to.
by JustinR
Sat May 08, 2021 7:45 am
Forum: Investing - Theory, News & General
Topic: Confused about dividend investing, market downturns and early retirement
Replies: 136
Views: 14468

Re: Confused about dividend investing, market downturns and early retirement

I-Know-Nothing wrote: Fri May 07, 2021 8:47 amInitially I thought this whole concept sounded great. However I’ve been researching further, and I don’t get how the yield shield actually protects someone in a market downturn. If you are invested in a higher-yield ETF like VYM, and there is a market downturn, you will still get a dividend. But don’t those dividends reduce the share price? Aren’t you still essentially “selling” during a downturn - whether you take a dividend and don’t reinvest it, or you sell shares of an ETF?
Yes, it's called mental accounting. By people who don't understand how dividends work.

A lot of uneducated investors think dividends are free money being deposited into their bank accounts, including the author you mentioned.
by JustinR
Tue May 04, 2021 3:42 pm
Forum: Investing - Theory, News & General
Topic: Your Cash Strategy: Is There A Difference Between Cash in a Brokerage Account vs Cash in a Checking Account?
Replies: 18
Views: 2426

Re: Your Cash Strategy: Is There A Difference Between Cash in a Brokerage Account vs Cash in a Checking Account?

Not sure I understand the context of the main question.

There's no difference except:

1) Interest rate differences
2) FDIC insured in a bank
by JustinR
Mon May 03, 2021 5:13 am
Forum: Investing - Theory, News & General
Topic: Qualified Versus Unqualified Dividends
Replies: 7
Views: 1329

Re: Qualified Versus Unqualified Dividends

TargetingFI wrote: Sun May 02, 2021 10:02 pm I have been investing in VTSAX and VTIAX for over a decade. Looking at my 2020 tax return, I was surprised to see those two funds produced more ordinary than qualified dividends, which, of course, means more taxes for me. I'd say approximately 55-60% were ordinary dividends.

As these are index funds, and don't commonly buy/sell new new positions like actively managed funds, why are the majority of dividends ordinary?
Box 1a "Total Ordinary Dividends" is actually "Total Dividends"

To find the amount of non-qualified dividends, you subtract 1a - 1b
by JustinR
Fri Apr 30, 2021 10:47 pm
Forum: Investing - Theory, News & General
Topic: The Bogleheads Guides - Books
Replies: 33
Views: 2849

Re: The Bogleheads Guides - Books

I only read "The Bogleheads Guide to Investing" and it was enough.

It's the only investing book I've ever had to read. I do the three fund portfolio.
by JustinR
Wed Apr 28, 2021 2:37 pm
Forum: Investing - Theory, News & General
Topic: Tax gain harvesting is counter-intuitive. You should sell highest cost basis shares.
Replies: 20
Views: 3130

Re: Tax gain harvesting is counter-intuitive. You should sell highest cost basis shares.

I also think this is useful to point out. Although it might be argued whether it's counterintuitive. In TLH higher basis shares are obviously preferred (lower basis ones might not be at a loss) so why would this change in TLG? But it's useful to illustrate why it doesn't. It's intuitive for TLH because you're trying to sell at a loss. Which means your highest cost shares will obviously have the largest loss. You'd arguably expect the exact opposite for TGH, not the same. Like why would you want to harvest the smallest gains? That's why, in my opinion, it's counterintuitive. Wait, do you know what tax gain harvesting is? It's not just selling shares, you buy them back right away at the current price, resetting the cost basis. You do this in...
by JustinR
Tue Apr 27, 2021 3:01 pm
Forum: Investing - Theory, News & General
Topic: Tax gain harvesting is counter-intuitive. You should sell highest cost basis shares.
Replies: 20
Views: 3130

Re: Tax gain harvesting is counter-intuitive. You should sell highest cost basis shares.

In both examples, the number of shares is 15000. Example 1 sold 1,000 shares to recognize $10k of gain (and made available $20k return of principal), but then used the total proceeds of $30k to immediately buy 1,000 shares at $30. Example 2 sold 2,000 shares to recognize $10k of gain (and made available $50k return of principal), but then used the total proceeds of $60k to immediately buy 2,000 shares at $30. There was nothing in the opening post about using the proceeds of sales to immediately buy shares. The opening post used 15000 as the initial number of shares. After the sale, example #1 had 14000 shares remaining and example #2 13000 shares remaining. Wait, do you know what tax gain harvesting is? It's not just selling shares, you bu...
by JustinR
Mon Apr 26, 2021 7:56 pm
Forum: Investing - Theory, News & General
Topic: Tax gain harvesting is counter-intuitive. You should sell highest cost basis shares.
Replies: 20
Views: 3130

Re: Tax gain harvesting is counter-intuitive. You should sell highest cost basis shares.

If the end price is $30 and you need to withdraw $50k, you'll have no gains to pay taxes on in example 2. However, in example 1 you'll have to draw from the $25 lot and pay some taxes. So the only difference between harvesting the lowest/highest lots, is that by harvesting the higher cost basis lot, you'll have more money to withdraw from the top. What I am missing is the "In the future when you need to withdraw money, you'll be able to withdraw more with example #2". To withdraw $50,000, 1667 shares would be sold if the price were $30. That would leave 12333 shares with example #1 and 11333 shares with example 2. I'm missing how it is possible to withdraw more money in the future with example #2 when that example has fewer share...
by JustinR
Mon Apr 26, 2021 5:40 pm
Forum: Investing - Theory, News & General
Topic: I don’t understand why tax loss harvesting is that beneficial
Replies: 183
Views: 22313

Re: I don’t understand why tax loss harvesting is that beneficial

Yes. In your annual tax forms, in the 1099-B (Vanguard issues a consolidated 1099 and it will be a section in there), it'll list your loss amounts (and gains if you have any). You just plug that into your tax software, and the software will correctly deduct $3,000 for this year, and (at least for my software) figure out the overflow for next year in the "Capital Loss Carryover Worksheet." If you use the same software next year, it might import this carryover automatically to deduct $3,000 for next year. Or you might have to manually input the correct carryover loss amount. But in the end it's up to you to make sure it's kept track of. I see--so it's up to the seller to keep track of multiple years of losses. And this deduction in...
by JustinR
Mon Apr 26, 2021 5:22 pm
Forum: Investing - Theory, News & General
Topic: I don’t understand why tax loss harvesting is that beneficial
Replies: 183
Views: 22313

Re: I don’t understand why tax loss harvesting is that beneficial

Edit: Sorry, I didn't read the context of your post. March of last year - You could've harvested several years worth of losses in large downturns like that. That's really the key...it's way more efficient if you can harvest several years worth at once. You can deduct $3k a year, so if you have losses of $9k then you're set for this year plus the next two years. At a ~30% tax rate, that's $3,000 after-tax cash for executing a single trade. Then, you just need another downturn to happen in the next four years to do another one. That's pretty likely to happen. This way you get the most bang for your buck with minimal work. Not that it's much work at all. In any case, the small amount of work it is to figure everything out and execute the trad...
by JustinR
Mon Apr 26, 2021 4:53 pm
Forum: Investing - Theory, News & General
Topic: I don’t understand why tax loss harvesting is that beneficial
Replies: 183
Views: 22313

Re: I don’t understand why tax loss harvesting is that beneficial

Harvesting a loss smaller than $1k feels like more trouble than it's worth when you start thinking about the cost of not being invested and transaction fees and wash sales. When I TLH I have a partner such that I'm always invested. I have no transaction fees, and forced wash sales are rare or occur only because I otherwise have some compelling reason to create a wash sale. But I agree, it's up to everyone to determine how big a loss is worth it. For me it's about $500, depending on my mood that day. :) Curious, how often is this actually happening? The vast majority of my regular investing is happening in tax shelters so there is no benefit. I buy a lot every month or so depending on what's going on in my personal finance, usually in the $...
by JustinR
Mon Apr 26, 2021 3:00 pm
Forum: Investing - Theory, News & General
Topic: Tax gain harvesting is counter-intuitive. You should sell highest cost basis shares.
Replies: 20
Views: 3130

Re: Tax gain harvesting is counter-intuitive. You should sell highest cost basis shares.

I'm missing how "In the future when you need to withdraw money, you'll be able to withdraw more with example #2 with less taxes." 13000 shares remain in the account with example #2, but 14000 shares remain with example #1. How can having fewer shares to sell in the future result in being able to withdraw more money? If you compare the two examples, 1) Your total amount invested is the same in both examples ($360,000). 2) The total amount of unrealized gains is the same in both examples ($90,000 at an end price of $30). Both examples will have the same amount of gains left, and therefore the same total tax you will have to pay. So in terms of "total gains left," it doesn't matter which lot you sell - it's the same. Howev...
by JustinR
Mon Apr 26, 2021 7:07 am
Forum: Investing - Theory, News & General
Topic: Tax gain harvesting is counter-intuitive. You should sell highest cost basis shares.
Replies: 20
Views: 3130

Tax gain harvesting is counter-intuitive. You should sell highest cost basis shares.

When you think of tax gain harvesting, you're probably thinking "Great, I'm going to eliminate the largest gains and reset my cost basis." But in reality, the optimal thing to do seems to be to harvest your HIGHEST cost lots, not your lowest (long term shares of course). And every year, re-harvest that same lot that you just harvested (assuming the market went up). ----- I'll use a modified example from grabiner : Let's say you have: 5000 at $20 10000 at $25 Current price: $30 This year your income/tax bracket is low, so you have room to harvest $10k in gains. 1) If you harvest the lowest shares, you'll end up with: 4000 at $20 10000 at $25 1000 at $30 = $30,000 2) If you harvest the highest shares, you'll have: 5000 at $20 8000 a...
by JustinR
Sun Apr 25, 2021 10:55 pm
Forum: Investing - Theory, News & General
Topic: I don’t understand why tax loss harvesting is that beneficial
Replies: 183
Views: 22313

Re: I don’t understand why tax loss harvesting is that beneficial

I-Know-Nothing wrote: Sun Apr 25, 2021 10:49 amThis sounds good, but is $3k a year enough to really alter the picture that much for most investors?
It's not meant to "alter the picture."

It's a free ~$1,000 cash bonus in your pocket per year.

The increased cost basis can be mitigated in the future using strategic tax planning.
by JustinR
Thu Apr 15, 2021 9:26 pm
Forum: Investing - Theory, News & General
Topic: What’s the problem with dividends?
Replies: 379
Views: 30517

Re: What’s the problem with dividends?

Dividends force you to realize those gains based on their schedule. So, if everything else is equivalent, as you mentioned, selling stock is better than dividends. There is a reason to prefer capital gains and no reason to prefer dividends. I think this is a strong argument. However, if you are retired and you are spending your dividends every year to pay bills, it is entirely reasonable to have index funds that pay dividends, in a taxable account. Some--like SCHD--have experienced both growth and nice dividends. Google it, and I'll think you'll be pleasantly surprised. Funds with "qualified dividends"--after an initial qualifying time period--produce dividends that are taxed at the long term capital gains rate. In my state, divi...
by JustinR
Thu Apr 15, 2021 2:32 pm
Forum: Investing - Theory, News & General
Topic: What’s the problem with dividends?
Replies: 379
Views: 30517

Re: What’s the problem with dividends?

international001 wrote: Thu Apr 15, 2021 7:57 am
JustinR wrote: Thu Apr 15, 2021 3:12 am
Example: You receive a $500 dividend. All $500 is taxed ($75 at 15% tax). Instead, if you sold it yourself and $100 of it was gains, you'd only pay $15 in tax. That's a $60 difference for just $500.
Measure apples to apples. Compare the net return after taxes wether the company increases 25% in value or decides to do a 25% dividend distribution.
That actually doesn't matter.

Since you can control when and how much you sell for, your taxes for manually sold shares can literally always be 0% (or some other lower tax % compared to a dividend) if you plan well enough.

Your after-tax amount with sold shares will always be = or > than dividends.
by JustinR
Thu Apr 15, 2021 3:12 am
Forum: Investing - Theory, News & General
Topic: What’s the problem with dividends?
Replies: 379
Views: 30517

Re: What’s the problem with dividends?

Why do so many folks on here find dividend income undesirable if one needs income? Qualified dividends have the same tax rate as long term capital gains, so what difference does it make whether the income comes from selling appreciated assets or from dividends? Dividends are WORSE than selling the stock yourself in several ways: You can't control when You can't control how much Dividends are taxed more. When you receive a dividend, the entire amount is taxed. When you sell stock, only the gain is taxed. Example: You receive a $500 dividend. All $500 is taxed ( $75 at 15% tax). Instead, if you sold it yourself and $100 of it was gains, you'd only pay $15 in tax. That's a $60 difference for just $500. So imagine an annoying guy named Ralph r...
by JustinR
Thu Apr 15, 2021 12:54 am
Forum: Investing - Theory, News & General
Topic: Why Does Anyone Listen To Paul Merriman?
Replies: 151
Views: 34827

Re: Why Does Anyone Listen To Paul Merriman?

Really good marketing for the Ultimate Busywork Portfolio
by JustinR
Thu Apr 08, 2021 5:05 am
Forum: Personal Finance (Not Investing)
Topic: How does the IRS know if you've exceeded the 401k max?
Replies: 1
Views: 806

How does the IRS know if you've exceeded the 401k max?

The max total contribution amount for 2020 is $57,000.

How would the IRS know if you've exceeded that amount?

The only number that appears on your W2 is your Traditional/Roth 401k contributions in box 12.

Neither your employer's contributions nor your after-tax contributions appear anywhere.

Obviously your provider may automatically stop you at $57k, but other than that how does anyone know if you've hit the limit or not? I don't think the tax form even asks you about it.
by JustinR
Sat Apr 03, 2021 6:31 am
Forum: Investing - Theory, News & General
Topic: What is so great about dividends? Alot of misinformation?
Replies: 219
Views: 48470

Re: What is so great about dividends? Alot of misinformation?

So many analysts discuss dividend paying stocks and make it seem like buying a stock without dividends is a bone head move that causes you to miss out on guaranteed income. Although, every definition of dividends that I have read online explain that a dividend does not increase the value of a stock at all. It is exactly like a stock split to a lesser degree. For example, when microsoft gave a 10% dividend about 5 few years back, the stock dropped 10% that day. It would essentially be like selling 10% of your shares, but not being charged any commission (which is good for retired folks who need a steady stream of income). On the other hand, the company is taxed on their profits, and then you get taxed again on the dividends they pay you wit...
by JustinR
Fri Apr 02, 2021 9:25 pm
Forum: Investing - Theory, News & General
Topic: What am I missing? Don't max out your 401k.
Replies: 80
Views: 12939

Re: What am I missing? Don't max out your 401k.

By planning ahead to keep your taxes at 0% during the conversion. A "married filing jointly" aged 65+ couple can do $27k of Roth conversions every year tax free, while withdrawing $80k from their taxable accounts tax free. See the math in this post (how to move $107,000 a year while owing $0 in federal taxes): https://www.bogleheads.org/forum/viewtopic.php?f=10&t=315594#p5279087 The Roth conversion ladder is also one of two ways to access your ENTIRE 401k before retirement age. Let me repeat: Withdraw your entire traditional 401k tax free and before retirement age That is why you should max out your traditional 401k. It's the single most powerful retirement account, and you're only screwing yourself if you don't because you c...
by JustinR
Fri Apr 02, 2021 3:16 pm
Forum: Investing - Theory, News & General
Topic: Common Cents On Roth Conversions
Replies: 32
Views: 4555

Re: Common Cents On Roth Conversions

What a dumb article.

The point of Roth Conversions is that you have full control of your tax rate going in and out (0% guaranteed going in, and 0% or some other low % going out).

In Roth and Taxable you can't control your tax rate going in.
by JustinR
Thu Apr 01, 2021 3:47 pm
Forum: Investing - Theory, News & General
Topic: What am I missing? Don't max out your 401k.
Replies: 80
Views: 12939

Re: What am I missing? Don't max out your 401k.

A traditional 401k is probably the most powerful investing account one can possibly have, as it is the only account that lets you do triple 0% taxes (on funding, conversion, and withdrawal) through Roth conversions. How do you get out of paying taxes at Roth conversion? I was under the impression that since the 401k is pre-tax & Roth is post-tax, taxes were due at conversion. By planning ahead to keep your taxes at 0% during the conversion. A "married filing jointly" aged 65+ couple can do $27k of Roth conversions every year tax free, while withdrawing $80k from their taxable accounts tax free. See the math in this post (how to move $107,000 a year while owing $0 in federal taxes): https://www.bogleheads.org/forum/viewtopic.p...
by JustinR
Thu Apr 01, 2021 6:54 am
Forum: Investing - Theory, News & General
Topic: What am I missing? Don't max out your 401k.
Replies: 80
Views: 12939

Re: What am I missing? Don't max out your 401k.

Incorrect.

A traditional 401k is probably the most powerful investing account one can possibly have, as it is the only account that lets you do triple 0% taxes (on funding, conversion, and withdrawal) through Roth conversions.

Maxing it out as a no-brainer, as if you don't it's lost forever.

Only an HSA is possibly better except for its tiny limit, making it less effective.
by JustinR
Mon Mar 29, 2021 8:18 pm
Forum: Investing - Theory, News & General
Topic: Dividends vs no dividends. A case study.
Replies: 53
Views: 4546

Re: Dividends vs no dividends quantified

Dividends are not wealth. Your example is like saying you are going to buy individual stocks based on the positive earning calls and are expecting to profit from it as if you were the only market participant. The market arbitrages away the benefit of a dividend. If it didn't, then you could simply buy dividend paying stocks or funds seconds before close on the day before the ex-div date and sell it seconds after open the next day - you still collect the FULL dividend in that example with minimal risk. It doesn't work that way - the market is not an ATM machine for you. I calculated with the dividend paying entity getting reduced by the dividend each year. So year 1 for the non div = $110. The div paying = $107.8 after paying $2.20 dividend...
by JustinR
Mon Mar 29, 2021 6:40 pm
Forum: Investing - Theory, News & General
Topic: Dividends vs no dividends. A case study.
Replies: 53
Views: 4546

Re: Dividends vs no dividends quantified

Here's why the way your example is set up doesn't make sense: Company A pays no dividends Company B pays a 100% dividend You start with $100. After 1 year, the stock goes up 10%. Company A: $110. Company B: $110 dividend with 0% left invested. In year 2 the stock goes up 500%. Company A: $550 Company B: $110 cash Therefore no dividend is better. If instead, in year 2 the stock goes down 500%. Company A: $0 Company B: $110 cash Therefore dividend is better. Conclusion: You have to reinvest the dividends to make any comparison work. You'll find that the two situations will be mathematically equivalent, assuming 0% taxes. If there are any taxes at all, then dividends will always lose. Since dividends are a taxable event every time, dividends w...
by JustinR
Fri Mar 05, 2021 9:19 pm
Forum: Investing - Theory, News & General
Topic: Bond Asset Allocation % include/exclude Emergency Fund
Replies: 63
Views: 4590

Re: Bond Asset Allocation % include/exclude Emergency Fund

Ideally, yes include it since it is a part of your non-equity assets.

In practice, do whatever works for you. Not a big deal either way.
by JustinR
Tue Mar 02, 2021 10:23 pm
Forum: Personal Finance (Not Investing)
Topic: E-filing tax return
Replies: 11
Views: 1029

Re: E-filing tax return

If you hand-do your returns, you have to mail them all your 1099s?
by JustinR
Fri Feb 26, 2021 10:05 pm
Forum: Investing - Theory, News & General
Topic: is my understanding of tax loss harvesting correct?
Replies: 66
Views: 4961

Re: is my understanding of tax loss harvesting correct?

Not sure what's going on in this thread.

Every few years there is a large market drawdown. For example March of last year.

You sell your lots that are red to realize a loss (by exchanging it to a different fund). Let's say it's a $9,000 loss.

Congratulations, you can now lower your taxable income by $3,000 for the next three years.

If your taxes are in the 30% range, that means with this one transaction you got a nice cash bonus of $3,000 ($1,000 a year for 3 years).

Then, if there's another drawdown anytime in the next 4 years you can do another sale and tack on more losses for year 4+.

It's not rocket science.
by JustinR
Fri Feb 26, 2021 4:52 am
Forum: Investing - Theory, News & General
Topic: is my understanding of tax loss harvesting correct?
Replies: 66
Views: 4961

Re: is my understanding of tax loss harvesting correct?

TLH is a free ~$1,000 cash a year.

Especially if you plan on retiring early and keeping your taxes minimal.
by JustinR
Mon Feb 15, 2021 8:33 pm
Forum: Investing - Theory, News & General
Topic: The premise of the "emergency fund" is flawed
Replies: 559
Views: 46334

Re: The premise of the "emergency fund" is flawed

silent_john wrote: Mon Feb 15, 2021 7:35 pm Only on BH do we see 400+ replies debating on whether or not an emergency fund counts towards your investment allocation.

I agree with Klang and others that I don't consider my EF as part of my INVESTABLE allocation at all. Ohh I'm actually 77.345634/23.634234 instead of 80/20 omg WHO CARES? :oops:
Yea, the premise of this thread is flawed.
by JustinR
Mon Feb 15, 2021 8:32 pm
Forum: Investing - Theory, News & General
Topic: The Final, Definitive Thread on Brokerage Transfer Bonuses
Replies: 7737
Views: 1337692

Re: The Final, Definitive Thread on Brokerage Transfer Bonuses

cookymonster wrote: Mon Feb 15, 2021 7:51 am I contributed $6k to my Traditional IRA at ETrade and was just awarded a $50 bonus. I’d now like to do the Roth conversion.

I was curious about the mechanics of a split rollover (couldn’t find much info in a search). Is it as simple as converting $6k to my Roth IRA as I do every year through the back door Roth, and then moving the remaining $50 to my individual 401k?
I think you have to rollover the $50 to your 401k first (before the roth conversion) to avoid the pro rata rule right?

Wait, never mind doesn't apply here if you just have the one traditional IRA.

For me, I'd just do the rollover first, then the conversion so it's cleaner.
by JustinR
Sun Feb 14, 2021 6:37 am
Forum: Investing - Theory, News & General
Topic: The premise of the "emergency fund" is flawed
Replies: 559
Views: 46334

Re: The premise of the "emergency fund" is flawed

I don't buy this at all. During an emergency, I don't care about "maintaining my asset allocation." That's probably the last thing on my mind. All I care about is having liquid funds. I'll deplete my fixed income until it's $0. Change my mind on why I'm wrong. You're not right od wrong. You're just acknowledging that you'd not maintain your AA or anywhere close to it in an emergency. Would you rebalance when fixed income goes to $0? Presumably no, so would you rebalance with new money? What you're alluding to, I believe, is that you'd essentially abandon your AA for potentially years or permanently. In that case, why aren't you just 100%w equities now, since you seem to be fine with it? I feel like you and I have different ideas ...
by JustinR
Sun Feb 14, 2021 5:48 am
Forum: Investing - Theory, News & General
Topic: The premise of the "emergency fund" is flawed
Replies: 559
Views: 46334

Re: The premise of the "emergency fund" is flawed

I don't buy this at all. During an emergency, I don't care about "maintaining my asset allocation." That's probably the last thing on my mind. All I care about is having liquid funds. I'll deplete my fixed income until it's $0. Change my mind on why I'm wrong. You're not right od wrong. You're just acknowledging that you'd not maintain your AA or anywhere close to it in an emergency. Would you rebalance when fixed income goes to $0? Presumably no, so would you rebalance with new money? What you're alluding to, I believe, is that you'd essentially abandon your AA for potentially years or permanently. In that case, why aren't you just 100%w equities now, since you seem to be fine with it? I feel like you and I have different ideas ...
by JustinR
Sun Feb 14, 2021 2:17 am
Forum: Investing - Theory, News & General
Topic: The premise of the "emergency fund" is flawed
Replies: 559
Views: 46334

Re: The premise of the "emergency fund" is flawed

I don't buy this at all.

During an emergency, I don't care about "maintaining my asset allocation." That's probably the last thing on my mind. All I care about is having liquid funds.

I'll deplete my fixed income until it's $0.

Change my mind on why I'm wrong.
by JustinR
Sat Feb 13, 2021 3:57 am
Forum: Investing - Theory, News & General
Topic: Question about Fidelity retirement rule of thumb
Replies: 21
Views: 2530

Re: Question about Fidelity retirement rule of thumb

25x is based on an actual study that says you have enough money to stay afloat for 30 years (but pretty much indefinitely).

These days it's recommended that you aim for 3.5% (29x) or 3% (33x) to be really safe, because we don't know what the future will bring.
by JustinR
Fri Feb 12, 2021 8:51 pm
Forum: Investing - Theory, News & General
Topic: TD Ameritrade contact method is a joke
Replies: 15
Views: 2105

Re: TD Ameritrade contact method is a joke

hi_there wrote: Fri Feb 12, 2021 8:15 pm How does your experience with TD compare with that of your other brokers? There is also an email link right in the middle of their Contact page. So, phone call is not the only way to contact them.

Not that this helps with your question, but from my usage, the intuitiveness of their platform and actually helpful AI for FAQs has mitigated the need to contact them for support. So, your question must have been very complex.

In general, in the rare ocassion when I have emailed TD or various other brokers with questions, they respond in 1-2 business days.
I must be blind. Where is the email link on the contact page?

https://www.tdameritrade.com/why-td-ame ... ct-us.page?
by JustinR
Fri Feb 12, 2021 2:51 pm
Forum: Investing - Theory, News & General
Topic: TD Ameritrade contact method is a joke
Replies: 15
Views: 2105

Re: TD Ameritrade contact method is a joke

Ramjet wrote: Fri Feb 12, 2021 2:45 pm You can send them a message, call them and they will call you back, or call a local office. This seems the same to me as all other brokerages..
How do you get them to call you back? I don't get that option.
by JustinR
Fri Feb 12, 2021 1:59 pm
Forum: Investing - Theory, News & General
Topic: TD Ameritrade contact method is a joke
Replies: 15
Views: 2105

TD Ameritrade contact method is a joke

The only way to contact them is through phone. I've been trying yesterday and today and the wait time is 50m - 1h30m due to "higher call volume."

Do people actually wait that long?

Is this literally the only way to contact them?
by JustinR
Fri Feb 12, 2021 6:02 am
Forum: Investing - Theory, News & General
Topic: What happens if you retire using the 4% rule and the market crashes 40%+ the next week
Replies: 118
Views: 12811

Re: What happens if you retire using the 4% rule and the market crashes 40%+ the next week

If you were a robot and were following the rule literally you would continue withdrawing 4% off the original amount. In theory, based on historic data, you would be fine.

Realistically you'll lower the amount you withdraw because the future isn't the past.

There's also a few "dynamic" withdrawal strategies that flex based on what's happening with the economy. Two examples:
by JustinR
Fri Feb 12, 2021 5:40 am
Forum: Investing - Theory, News & General
Topic: Is The Bogleheads' Guide To Investing The Go-To Book?
Replies: 25
Views: 2874

Re: Is The Bogleheads' Guide To Investing The Go-To Book?

Just picked up a copy of the Bogleheads' Guide to Investing: https://www.amazon.com/Bogleheads-Guide-Investing-Taylor-Larimore/dp/1118921283/ref=asc_df_1118921283/ Is this book good? Is it the only one that I need? Any other recommendations? Yes, it's all you need. I can also summarize it as: Pick a good asset allocation. Start from 70% equities/30% bonds and go up or down depending on your risk tolerance and age. Pick a good domestic/international allocation. A recommended ratio is the world market weight: 57% US, 43% International. The only 3 funds you need: VTSAX, VTIAX, VBTLX (or any equivalents). Don't bother with any other funds or portfolio strategies. Invest as soon as you have the money available. Set aside an emergency fund, six ...
by JustinR
Thu Feb 11, 2021 10:18 pm
Forum: Investing - Theory, News & General
Topic: If you are investing in a traditional 401(k) or traditional IRA, do you have a good reason for doing this?
Replies: 156
Views: 11801

Re: If you are investing in a traditional 401(k) or traditional IRA, do you have a good reason for doing this?

It looks like there are not too many good reasons for investing in a trad. Good reasons would be: Seems that trad investments should be avoided unless one of these are true: 1. Your marginal tax bracket for combined state and federal taxes is higher than the projected withdrawal tax bracket. 2. You are getting a employer match for every dollar that you are investing in a trad. 3. You cannot invest any more money in a Roth 401K or Roth IRA and you don't have and can't transfer trad accounts that can be converted to Roth. 4. You can invest more in an HSA. Am I missing anything? Traditional is superior to Roth in almost every way. You should only do Roth if you're forced to (above the income limits). I have no idea why you're framing the ques...
by JustinR
Wed Feb 10, 2021 10:09 pm
Forum: Investing - Theory, News & General
Topic: If you are investing in a traditional 401(k) or traditional IRA, do you have a good reason for doing this?
Replies: 156
Views: 11801

Re: If you are investing in a traditional 401(k) or traditional IRA, do you have a good reason for doing this?

It looks like there are not too many good reasons for investing in a trad. Good reasons would be: Seems that trad investments should be avoided unless one of these are true: 1. Your marginal tax bracket for combined state and federal taxes is higher than the projected withdrawal tax bracket. 2. You are getting a employer match for every dollar that you are investing in a trad. 3. You cannot invest any more money in a Roth 401K or Roth IRA and you don't have and can't transfer trad accounts that can be converted to Roth. 4. You can invest more in an HSA. Am I missing anything? Traditional is superior to Roth in almost every way. You should only do Roth if you're forced to (above the income limits). I have no idea why you're framing the ques...
by JustinR
Wed Feb 10, 2021 3:37 am
Forum: Investing - Theory, News & General
Topic: The Final, Definitive Thread on Brokerage Transfer Bonuses
Replies: 7737
Views: 1337692

Re: The Final, Definitive Thread on Brokerage Transfer Bonuses

Is Merrill offering any deals for $500k right now?
by JustinR
Tue Feb 09, 2021 2:27 am
Forum: US Chapters
Topic: Why A Good Boglehead Must Leave The Bogleheads Forum
Replies: 184
Views: 31641

Re: Why A Good Boglehead Must Leave The Bogleheads Forum

Should there be an "Active Investing, Speculation, and Gambling" forum where all that stuff should go?
by JustinR
Mon Feb 08, 2021 10:17 pm
Forum: Investing - Theory, News & General
Topic: The Power of Working Longer
Replies: 539
Views: 56126

Re: The Power of Working Longer

Impossible to test this theory that the attitude towards work is generational until the millennials get old enough that they could start retiring early, late or never. Until then, pure speculation that may well be driven by sampling error. "Everyone I talk to feels this way. I don't talk to people who disagree. In fact, I try to chase them away. Therefore, based on the people with whom I communicate, everyone agrees with me." There are no millennial federal judges who are eligible for full salary as pension, so we don't know what they will do when there are. Based on the millennials I know, and therefore an accurate representation of all millennials everywhere, many are looking for satisfying careers of significant accomplishment...
by JustinR
Mon Feb 08, 2021 8:04 pm
Forum: Investing - Theory, News & General
Topic: The Power of Working Longer
Replies: 539
Views: 56126

Re: The Power of Working Longer

Just curious, how old are you? No direct answer. Old enough that I could retire. Young enough that I anticipate a long working career ahead of me. What does the age of one person on here have to do with changing jobs vs retiring in response to job dissatisfaction? Or what retirement may have meant in years past? Because "everyone should find their passion job and work for fun as long as possible because otherwise life is meaningless" is classic boomer mentality. You can see this exact pattern time and time again in other threads about FIRE. It's based on the traditional values your generation grew up with. Young people don't think like this. You proved my theory right. Don't you think it's weird that I knew right away how old you...
by JustinR
Mon Feb 08, 2021 2:13 pm
Forum: Investing - Theory, News & General
Topic: The Power of Working Longer
Replies: 539
Views: 56126

Re: The Power of Working Longer

Just curious, how old are you? No direct answer. Old enough that I could retire. Young enough that I anticipate a long working career ahead of me. What does the age of one person on here have to do with changing jobs vs retiring in response to job dissatisfaction? Or what retirement may have meant in years past? Because "everyone should find their passion job and work for fun as long as possible because otherwise life is meaningless" is classic boomer mentality. You can see this exact pattern time and time again in other threads about FIRE. It's based on the traditional values your generation grew up with. Young people don't think like this. You proved my theory right. Don't you think it's weird that I knew right away how old you...
by JustinR
Mon Feb 08, 2021 8:47 am
Forum: Investing - Theory, News & General
Topic: The Power of Working Longer
Replies: 539
Views: 56126

Re: The Power of Working Longer

Pretending a job that does not *actually* threaten one's life leads to a shorter lifespan leads to cloudy thinking. There are some jobs that really do shorten one's lifetime. Thankfully, technological advances and regulation make those fewer every year. I think that, as acknowledged in this thread, most people who say "My job is sapping the life out of me" really mean "My job is not sapping the life out of me, but I don't like it". The rationale response to something that is *actually* threatening one's life is to get out as fast as possible. Even if it means being unemployed. The rational response to a safe job that one does not like is to look for a different job. Acting as if a safe job were life threatening leads to...