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by Kevin M
Sun May 24, 2015 5:11 pm
Forum: Investing - Theory, News & General
Topic: Stemikger "Volatility is far from synonymous with risk."
Replies: 35
Views: 1663

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

I find it more useful to think in terms of uncertainty of the expected return over the holding period of interest. If the holding period is 30 years, then I'm interested in the uncertainty of the 30-year return (for which deep risk probably is more relevant). If the holding period is one year, then ...
by Kevin M
Thu May 21, 2015 9:48 am
Forum: Investing - Help with Personal Investments
Topic: Newbie to Investing (Portfolio Review)
Replies: 3
Views: 311

Re: Newbie to Investing (Portfolio Review)

About two months ago, I visited a financial advisor. He recommended the funds currently selected in the 401(k). After two more visits, something didn't seem right, so I started reading books and that's how I ended up here. I haven't messed with anything. That will happen now. Making it here is a go...
by Kevin M
Thu May 21, 2015 5:27 am
Forum: Investing - Help with Personal Investments
Topic: Newbie to Investing (Portfolio Review)
Replies: 3
Views: 311

Re: Newbie to Investing (Portfolio Review)

First, why are you using the more expensive funds in your 401k, rather than just sticking with the low-cost, Vanguard funds? You have good funds available, so I would use them in preference to the higher-cost, actively managed funds. Also, I think you made a mistake on the ER of Vanguard 500 Index f...
by Kevin M
Wed May 20, 2015 4:13 pm
Forum: Investing - Theory, News & General
Topic: Why Bother With Bonds? (book shout out)
Replies: 7
Views: 1453

Re: Why Bother With Bonds? (book shout out)

Another small error, which also is an error in our Wiki, is the statement that I Bond purchases are limited to $10K per year per social security number. Apparently most people don't seem to know that one can also purchase an additional $10K per year in an entity account at TreasuryDirect in the nam...
by Kevin M
Wed May 20, 2015 12:14 pm
Forum: Personal Consumer Issues
Topic: Chip and sign card working great in Nice, France
Replies: 5
Views: 610

Re: Chip and sign card working great in Nice, France

We used my chip and sign Capital One card in one of the larger, blue, train-ticket machines today at Nice-Ville, and it worked fine. I also played around with one of the large yellow ticket machines, but it seemed much more complicated than the blue machines (although you can select English instruct...
by Kevin M
Tue May 19, 2015 5:37 pm
Forum: Personal Consumer Issues
Topic: Chip and sign card working great in Nice, France
Replies: 5
Views: 610

Chip and sign card working great in Nice, France

I've been in and around Nice, France for about a week and a half, and my chip and sign Capital One credit card has been working flawlessly. I got a bit paranoid before coming here because of a thread that said that you needed a chip and pin card to have things go smoothly in Europe, but that has not...
by Kevin M
Tue May 19, 2015 11:02 am
Forum: Investing - Help with Personal Investments
Topic: Estimating Portfolio Return
Replies: 13
Views: 1076

Re: Estimating Portfolio Return

Then how are people estimating their retirement if thats not a valid method? To be noted, I would be doing these for a VG Fund. You've received a couple of links to estimates for expected returns. You can find hundreds or thousands of posts here discussing expected returns for stocks. Something ver...
by Kevin M
Tue May 19, 2015 5:45 am
Forum: Investing - Help with Personal Investments
Topic: Vanguard account question regarding Balances and holdings view
Replies: 3
Views: 463

Re: Vanguard account question regarding Balances and holdings view

Yes, you can customize your view to hide zero balance funds.

Kevin
by Kevin M
Tue May 19, 2015 5:41 am
Forum: Investing - Help with Personal Investments
Topic: AA for both short and long-term goals
Replies: 2
Views: 248

Re: AA for both short and long-term goals

Seems like you have thought this out very thoroughly. As long as you have the flexibility to adapt to a loss of about 25%, including the scenario in which we don't get a recovery within your 5-year timeframe, then an initial 40/60 allocation for this goal, using a tax-exempt bond fund, seems quite r...
by Kevin M
Tue May 19, 2015 5:31 am
Forum: Investing - Help with Personal Investments
Topic: Estimating Portfolio Return
Replies: 13
Views: 1076

Re: Estimating Portfolio Return

Before even discussing the math, I would not use historical returns to estimate expected returns. For individual stocks it's even more of a crapshoot, due to extremely high unsystematic (company specific) risk, but even for a diversified stock fund, the consensus if pretty broad that valuations are ...
by Kevin M
Tue May 19, 2015 5:25 am
Forum: Investing - Help with Personal Investments
Topic: Question with 401(k) statement
Replies: 7
Views: 434

Re: Question with 401(k) statement

Maybe the employer adds it to his paycheck then contributes it to the 401k? Have you studied his paystub to see if this might be it? Why not just have him ask his payroll department if you can't figure it out?

Kevin
by Kevin M
Tue May 19, 2015 5:05 am
Forum: Investing - Theory, News & General
Topic: Individual treasuries vs treasury funds vs CDs: Effects of interest rate changes
Replies: 5
Views: 839

Re: Individual treasuries vs treasury funds vs CDs: Effects of interest rate changes

1) If interest rates rise, you will be likely to want to make an early withdrawal from the CD instead of staying locked into the low rate. Thus, you will incur a penalty. It was a brokered CD that was referenced, not a direct CD, so early withdrawal penalty is not at play here. Instead, it's the sa...
by Kevin M
Mon May 18, 2015 1:11 pm
Forum: Investing - Theory, News & General
Topic: AgFed Credit Union 5-year CD, 2.30%
Replies: 1
Views: 484

AgFed Credit Union 5-year CD, 2.30%

Just a quick note for those who might be bumping up against their FDIC/NCUA insurance limits for IRA CDs, and looking for another decent 5-year CD. Ken over at DepositAccounts.com has posted about a 5-year CD from Agricultural Federal Credit Union (AgFed CU) paying 2.30%, with an early withdrawal pe...
by Kevin M
Mon May 18, 2015 12:57 pm
Forum: Investing - Theory, News & General
Topic: Individual treasuries vs treasury funds vs CDs: Effects of interest rate changes
Replies: 5
Views: 839

Re: Individual treasuries vs treasury funds vs CDs: Effects of interest rate changes

A few comments to add. The duration of a 5-year (coupon paying) Treasury or CD is not 5 years, but something less than that. And of course you understand that the duration of the individual securities is constantly decreasing, as opposed to the relatively constant duration of the fund. So the term r...
by Kevin M
Fri May 15, 2015 7:14 pm
Forum: Investing - Theory, News & General
Topic: Why Bother With Bonds? (book shout out)
Replies: 7
Views: 1453

Re: Why Bother With Bonds? (book shout out)

gkaplan wrote:Is this out in book format yet? My library does not have it and does not have it on order. The book does not appear in the OCLC database, either.

If you click on the link, or just look on Amazon, you will see that it is available in paperback.

Kevin
by Kevin M
Fri May 15, 2015 7:11 pm
Forum: Investing - Help with Personal Investments
Topic: anyone else getting multiple revised tax forms from vanguard?
Replies: 19
Views: 804

Re: anyone else getting multiple revised tax forms from vanguard?

Are they Vanguard mutual funds? Which funds are they? Some of us may own the same funds and may be concerned. The Vanguard Developed Markets Index Fund. Come to think of it, I'm not sure it was foreign tax but rather dividends. I don't have the tax statements available but I do have quarterly state...
by Kevin M
Fri May 15, 2015 6:03 pm
Forum: Investing - Theory, News & General
Topic: Why Bother With Bonds? (book shout out)
Replies: 7
Views: 1453

Why Bother With Bonds? (book shout out)

Just wanted to give a little shout out to this book, which I just scanned the Kindle version of: Amazon.com: Why Bother With Bonds: A Guide To Build All-Weather Portfolio Including CDs, Bonds, and Bond Funds--Even During Low Interest Rates (How To Achieve Financial Independence) eBook: Rick Van Ness...
by Kevin M
Fri May 15, 2015 5:33 pm
Forum: Investing - Help with Personal Investments
Topic: anyone else getting multiple revised tax forms from vanguard?
Replies: 19
Views: 804

Re: anyone else getting multiple revised tax forms from vanguard?

Both were foreign tax mistakes. Tiny mistakes, a few cents I believe. But seriously, you would have thought they'd have this figured out by now As others have said, these are probably revisions from the sources, not Vanguard mistakes. If it's a few cents, I just wouldn't worry about it. If this kin...
by Kevin M
Fri May 15, 2015 5:28 pm
Forum: Investing - Help with Personal Investments
Topic: anyone else getting multiple revised tax forms from vanguard?
Replies: 19
Views: 804

Re: anyone else getting multiple revised tax forms from vanguard?

if i get a revised tax form of 5498 for my sep ira or traditional ira or roth ira do i need to file an amended tax return? they were for holdings inside ira Probably not. These forms usually don't even come out until May, and only might have an impact if you did a Roth conversion that involved a ba...
by Kevin M
Fri May 15, 2015 4:41 pm
Forum: Investing - Help with Personal Investments
Topic: anyone else getting multiple revised tax forms from vanguard?
Replies: 19
Views: 804

Re: anyone else getting multiple revised tax forms from vanguard?

No. I have multiple mutual fund and brokerage accounts, including ones I have agency on, and no revised 1099s.

Kevin
by Kevin M
Fri May 15, 2015 4:39 pm
Forum: Investing - Theory, News & General
Topic: The striking effects of career sequencing with pension and 401k
Replies: 13
Views: 1894

Re: The striking effects of career sequencing with pension and 401k

Haven't really studied your post in detail, but good for you for working this out and sharing it with us. Can't recall seeing a post like this before.

Kevin
by Kevin M
Thu May 14, 2015 5:37 pm
Forum: Investing - Theory, News & General
Topic: Interactive Brokers (Best Kept Secret)
Replies: 58
Views: 4687

Re: Interactive Brokers (Best Kept Secret)

But you have to fill out forms and applications, open accounts... monitor CD expiration dates... cancel auto-renewal provisions... set up linked accounts to transfer the interest... or do you use broker CDs? Yes, it does require some additional work. Good brokered CDs have a higher yield than Treas...
by Kevin M
Thu May 14, 2015 5:18 pm
Forum: Investing - Theory, News & General
Topic: International - Who really is at 40%
Replies: 93
Views: 6641

Re: International - Who really is at 40%

Target for international stocks has been 40% of equities for some years; nice to have Vanguard on course to catch up with me in its TR and LS funds ;-) My portfolio spreadsheet tells me I'm currently at 39.4%, so although I haven't updated the spreadsheet in awhile, I'm nowhere close to a rebalancin...
by Kevin M
Wed May 13, 2015 4:18 pm
Forum: Investing - Theory, News & General
Topic: Interactive Brokers (Best Kept Secret)
Replies: 58
Views: 4687

Re: Interactive Brokers (Best Kept Secret)

Back when I was using IB (2007-2010), there was a $10 minimum trading fee and $10 exchange fee, so $20 minimum per month. At the time, it was by far much cheaper to do the options trading I was doing (hedging employee stock options by selling calls) than at Fidelity or Vanguard, so it was worth it, ...
by Kevin M
Fri May 08, 2015 8:18 pm
Forum: Investing - Help with Personal Investments
Topic: Diversifying beyond Vanguard Target Date Fund
Replies: 45
Views: 4384

Re: Diversifying beyond Vanguard Target Date Fund

Some of the things you are considering will simply increase your fixed income allocation; e.g., I Bonds, EE Bonds, CDs. I Bonds will provide some inflation protection, which is incorporated into the earlier-dated Target Retirement funds, but not the later date ones. I think CDs, especially those pur...
by Kevin M
Fri May 08, 2015 2:17 pm
Forum: Investing - Theory, News & General
Topic: Help me understand why maxing out Roth TSP is better than Traditional
Replies: 23
Views: 1400

Re: Help me understand why maxing out Roth TSP is better than Traditional

I think forum member tfb has done a good job of explaining the tradeoffs in a couple of his blog posts: The Case Against Roth 401(k) . Be sure to also read the other post he links to in the post linked above: Roth 401(k) for People Who Contribute the Max Would be interested to hear what you think af...
by Kevin M
Thu May 07, 2015 9:11 pm
Forum: Investing - Help with Personal Investments
Topic: TIAA Trad/stable value and NO bonds?
Replies: 19
Views: 1463

Re: TIAA Trad/stable value and NO bonds?

Thank you! If bond returns are predictable to within +/-1%, then why do people still recommend against timing the market with bonds? I don't quite understand the question. First, we are talking about bond funds, not bonds in general. The return for an individual bond is even more predictable, if he...
by Kevin M
Thu May 07, 2015 6:47 pm
Forum: Investing - Help with Personal Investments
Topic: Tax Loss Harvest VWIUX -> MUB?
Replies: 12
Views: 784

Re: Tax Loss Harvest VWIUX -> MUB?

I think 2008 tends to show mostly credit and liquidity risk and 2013 mostly duration risk. Do you agree with this assessment? Makes sense, since Treasuries went up in 2008, long-term Treasuries the most, and they went down in 2013, again, long-term Treasuries the most. Year Fund CapRtn IncRtn TotRt...
by Kevin M
Thu May 07, 2015 2:29 pm
Forum: Forum Issues and Administration
Topic: Forum software upgrade bug reports and change requests
Replies: 202
Views: 9091

Re: Forum software upgrade bug reports and change requests

did anyone mention that we can no longer subscribe or unsubscribe a topic at the bottom of the thread? unsubscribing can work when clicking on the email alert yet if there is a topic I want to follow, I need to submit a comment in order to get an alert Clicking on the tool/wrench icon at the bottom...
by Kevin M
Thu May 07, 2015 2:24 pm
Forum: Investing - Help with Personal Investments
Topic: Tax Loss Harvest VWIUX -> MUB?
Replies: 12
Views: 784

Re: Tax Loss Harvest VWIUX -> MUB?

The six-month thing doesn't mean you can't TLH, just that the losses are offset by the dividends on the shares you purchased in the last six months. The way I avoided this complexity last time I TLHd muni funds with losses was just to sell all shares other than those purchased in last six months. If...
by Kevin M
Thu May 07, 2015 1:59 pm
Forum: Investing - Help with Personal Investments
Topic: Tax Loss Harvest VWIUX -> MUB?
Replies: 12
Views: 784

Re: Tax Loss Harvest VWIUX -> MUB?

Regarding the relative riskiness, you can look at performance in 2008 or 2013 to get a sense. The relatively low durations of the long-term TE funds probably understate their riskiness somewhat. Year Fund CapRtn IncRtn TotRtn ---- ----- ------ ------ ------ 2008 VWIUX -4.15% 4.08% -0.07% 2008 VWLUX ...
by Kevin M
Thu May 07, 2015 1:46 pm
Forum: Investing - Help with Personal Investments
Topic: Tax Loss Harvest VWIUX -> MUB?
Replies: 12
Views: 784

Re: Tax Loss Harvest VWIUX -> MUB?

One positive in TLHing into the long-term TE fund is that if rates go up more, you may have even more losses to harvest than with an intermediate-term fund (depending on how the muni yield curve shifts), and you will have higher tax-free income to offset the losses. Then you can harvest those losses...
by Kevin M
Thu May 07, 2015 12:29 pm
Forum: Forum Issues and Administration
Topic: Forum software upgrade bug reports and change requests
Replies: 202
Views: 9091

Re: Forum software upgrade bug reports and change requests

I almost never use Bogleheads.org/forum, but I tried it on my Nexus pad after the recent changes. There is no "new posts" quicklink on my Nexus (just Unanswered posts, Active topics, and The team), although there is one on my Chromebook. Without a "new posts" quick link, the for...
by Kevin M
Wed May 06, 2015 9:09 pm
Forum: Forum Issues and Administration
Topic: Slow speed
Replies: 12
Views: 767

Re: Slow speed

Me too.
by Kevin M
Wed May 06, 2015 8:11 pm
Forum: Forum Issues and Administration
Topic: Forum software upgrade bug reports and change requests
Replies: 202
Views: 9091

Re: Forum software upgrade bug reports and change requests

Loading Bogleheads.org pages has been super slow for last hour or two; basically unusable. Speedtest shows my internet speed as fine (fast). Font on Bogleheads.org is large. Using a Chromebook. I almost never use Bogleheads.org/forum, but I tried it on my Nexus pad after the recent changes. There is...
by Kevin M
Wed May 06, 2015 3:09 pm
Forum: Investing - Help with Personal Investments
Topic: TIAA Trad/stable value and NO bonds?
Replies: 19
Views: 1463

Re: TIAA Trad/stable value and NO bonds?

How accurate is the forward looking yield? The SEC yield is a reasonably good estimate of subsequent 5-year or 10-year return for something like Total Bond Index fund, but there can be quite a bit of variance. Here is a post in which I show initial yields and subsequent 10-year returns for VBMFX: I...
by Kevin M
Wed May 06, 2015 12:54 pm
Forum: Investing - Theory, News & General
Topic: Are we experiencing a bond correction or crash?
Replies: 34
Views: 5669

Re: Are we experiencing a bond correction or crash?

You mean today? Last week or last month? I don't see anything resembling a bond crash, whatever that would look like. Looking at a 5-year yield history for 10-year Treasuries: http://research.stlouisfed.org/fred2/graph/fredgraph.png?g=1as6 The recent blip up in yield doesn't look significant compare...
by Kevin M
Wed May 06, 2015 11:32 am
Forum: Investing - Help with Personal Investments
Topic: CD ladder at Ally - multiple durations or just one
Replies: 20
Views: 2538

Re: CD ladder at Ally - multiple durations or just one

PenFed also offers partial withdrawals, and penalty-free partial withdrawals if age 59 1/2 or older (must keep $1,000 in the CD to avoid penalty). However, PenFed rates currently are not competitive, at 1.5% on the 5-year. Synchrony Bank previously offered the same penalty-free withdrawal deal if ag...
by Kevin M
Tue May 05, 2015 7:55 pm
Forum: Investing - Help with Personal Investments
Topic: CD ladder at Ally - multiple durations or just one
Replies: 20
Views: 2538

Re: CD ladder at Ally - multiple durations or just one

CWRadio wrote:If the CDs are in a IRA CD account can you remove RMD without any penalty? Thanks

Most direct CD terms I've seen specifically allow this.

Kevin
by Kevin M
Tue May 05, 2015 3:55 pm
Forum: Investing - Help with Personal Investments
Topic: CD ladder at Ally - multiple durations or just one
Replies: 20
Views: 2538

Re: CD ladder at Ally - multiple durations or just one

Kevin, Like you, I am a retiree with a portfolio allocation of 30/70 equities/fixed income. Just FYI, your posts are amongst the most valuable on this forum and have really helped with choosing fixed income sources esp. your thoughts on CDs (direct vs. brokered). Thank you for what you do and share...
by Kevin M
Tue May 05, 2015 12:18 pm
Forum: Investing - Help with Personal Investments
Topic: CD ladder at Ally - multiple durations or just one
Replies: 20
Views: 2538

Re: CD ladder at Ally - multiple durations or just one

1. My mother's assets are all in a trust of which she is the grantor and I am co-trustee. As grantor, the trust is identified with her social security. Are you saying that even though a trust might be in the SS number of the same person, they are 2 different identities and therefore she can get up ...
by Kevin M
Mon May 04, 2015 6:20 pm
Forum: Investing - Help with Personal Investments
Topic: Is there any stable value funds that returns ~3% outside of a 401k?
Replies: 12
Views: 1757

Re: Is there any stable value funds that returns ~3% outside of a 401k?

Looks like I may have to rollover into my 403b. The question I have now is, can you rollover to a 403b when you have left the company that offered/sponsored the 403b plan? I doubt it, but unless someone else replies with a definitive "no", citing a regulation or something, it doesn't hurt...
by Kevin M
Mon May 04, 2015 1:45 pm
Forum: Investing - Help with Personal Investments
Topic: CD ladder at Ally - multiple durations or just one
Replies: 20
Views: 2538

Re: CD ladder at Ally - multiple durations or just one

I would go with option #2 (all 5-year CDs) unless your mother will absolutely, positively need the money each year; e.g., if she plans on living off of the annual ladder proceeds. Although I have done early withdrawals from both Ally Bank and Barclays Bank with no problems, I always consider it poss...
by Kevin M
Mon May 04, 2015 10:53 am
Forum: Investing - Theory, News & General
Topic: What do you consider "cash"
Replies: 32
Views: 2385

Re: What do you consider "cash"

I Bonds have an early withdrawal penalty of 3 months of interest until they have been held for 5 years, so for those whose cash criteria include no nominal loss in value, I Bonds are not cash until they've been held for at least 5 years; until then, they are more like a direct CD with an early withd...
by Kevin M
Sun May 03, 2015 4:08 pm
Forum: Investing - Theory, News & General
Topic: What do you consider "cash"
Replies: 32
Views: 2385

Re: What do you consider "cash"

A brokered CD is very much like a bond. It fluctuates in value depending on interest-rate changes, and it provides an income stream. A direct CD is unique--especially in the environment of the last few years. Now, and for the last few years, you generally earn a higher rate than a Treasury of compar...
by Kevin M
Sun May 03, 2015 2:52 pm
Forum: Investing - Help with Personal Investments
Topic: Is there any stable value funds that returns ~3% outside of a 401k?
Replies: 12
Views: 1757

Re: Is there any stable value funds that returns ~3% outside of a 401k?

^Well, if we're going to branch out from SV funds, one can also earn 3% on up to $15K or $20K in a reward checking account (RCA). There actually is one offering up to 4.09% and 5.09% with some extra work (but the last tier requires giving up more in 2% cash back credit card purchases than you'll mak...
by Kevin M
Sun May 03, 2015 2:38 pm
Forum: Investing - Help with Personal Investments
Topic: Everyone is saying to get out of Bond Funds? Ignore?
Replies: 41
Views: 4927

Re: Everyone is saying to get out of Bond Funds? Ignore?

Nice post, Dodge, but one correction, and some clarification: If you're invested in Vanguard's Total Bond Index Fund , your average maturity date is 7.8 years. This makes your "Point of indifference" about 2.5 years. After that, you are better off with the higher interest rates. Looking at...
by Kevin M
Sat May 02, 2015 11:10 pm
Forum: Investing - Help with Personal Investments
Topic: Is there any stable value funds that returns ~3% outside of a 401k?
Replies: 12
Views: 1757

Re: Is there any stable value funds that returns ~3% outside of a 401k?

The only one I know about is the Colorado 529 Stable Value Plus, earning 3.09% for 2015. It's a great option if you want to earmark some funds for qualified educational purposes, and since money is fungible, you could also invest in stocks in a taxable account for longer-term educational goals.

Kevin
by Kevin M
Sat May 02, 2015 11:00 pm
Forum: Investing - Help with Personal Investments
Topic: S&P heavy 401k - Asset Allocation Across Accounts
Replies: 19
Views: 1624

Re: S&P heavy 401k - Asset Allocation Across Accounts

Thanks for the suggestions. Where can I find recommended portfolio % per asset class? Ex. How much REITS and Small Cap Value Index to hold. I personally don't know much about REITS and if they are necessary. I would just stick with a total market-cap type of approach until you've thoroughly researc...
by Kevin M
Sat May 02, 2015 10:02 pm
Forum: Investing - Help with Personal Investments
Topic: There's a monster under my bed... [CDs instead of bonds?]
Replies: 30
Views: 3496

Re: There's a monster under my bed... [CDs instead of bonds?]

In addition to the PenFed 3% CD (3.05% APY), the only CD I've purchased at that rate or better over last 4.5 years was a PenFed 7-year CD at 3.49% APY, purchased on 11/16/2010. Closest runner-ups were PenFed 5-year at 2.75% on 12/14/2010, and Ally 5-year at 2.74% on 9/15/2010.

Kevin

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