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Re: Please review my strategy (new at investing)

I don't see anything obviously wrong, but ,more details as suggested would be nice. I'm intrigued by your question # 3 as I don't believe I've seen that "AA before tax/after tax question" posted in quite this way. (There are a lot of threads regarding portfolios and whether you should weig...
by Peter Foley
Thu Oct 30, 2014 6:28 pm
 
Forum: Investing - Help with Personal Investments
Topic: Please review my strategy (new at investing)
Replies: 6
Views: 627

Re: Early SS or Higher IRA Withdrawal??

Something to consider when the time is near . . . What is the economic situation at the time? [I was thinking of retiring in summer or fall of 2010. We were still in the middle of a recession and our portfolio had taken a bit of a hit. As I didn't mind the work I was doing, I delayed retirement unti...
by Peter Foley
Thu Oct 30, 2014 2:53 pm
 
Forum: Personal Finance (Not Investing)
Topic: Early SS or Higher IRA Withdrawal??
Replies: 19
Views: 1500

Re: Wisconsin - Madison Meetings - Master Thread

I was happy to attend the last meeting but it is unlikely the timing will be such so that I attend then next (St. Paul to Madison is a long commute). I did not think of it until I returned, but the MN Boglerheads has two splinter groups - one east aide and one west side. These two groups meet a few ...
by Peter Foley
Thu Oct 30, 2014 12:32 pm
 
Forum: Local Chapters and Bogleheads Community
Topic: Wisconsin - Madison Meetings - Master Thread
Replies: 41
Views: 2951

Re: 1099 vs. W2 income

There are state and federal laws concerning what constitutes independent contractor status (1099) or employee (W-2). You don't get to choose. Much of law is based on interpretations of "direction and control". Another key factor is the independent contractor's ability to sell their service...
by Peter Foley
Thu Oct 30, 2014 11:23 am
 
Forum: Personal Finance (Not Investing)
Topic: 1099 vs. W2 income
Replies: 5
Views: 427

Re: "Schwab Intelligent Portfolios"

Jack FFR1846 wrote: I've considered opening a taxable acct at Schwab because I can buy an schb etf for no fee. I don't talk with any brokerage houses for advice. It has been more than 20 years since I asked a brokerage house for advice regarding what to buy or sell. They do offer some other services...
by Peter Foley
Thu Oct 30, 2014 11:10 am
 
Forum: Investing - Theory, News & General
Topic: "Schwab Intelligent Portfolios"
Replies: 40
Views: 2645

Re: Early SS or Higher IRA Withdrawal??

Are both you and your wife eligible for SS? Will her benefits be reduced because of her federal pension?
by Peter Foley
Wed Oct 29, 2014 10:16 pm
 
Forum: Personal Finance (Not Investing)
Topic: Early SS or Higher IRA Withdrawal??
Replies: 19
Views: 1500

Re: Your Thoughts on my Portfolio

I have used Schwab for many years. You no doubt have someone assigned to you. I have far less in assets and have an account rep. She produced a good Roth conversion plan and overall financial plan. It was good to have someone else take a second look. With your assets and annual expenses you can hard...
by Peter Foley
Mon Oct 27, 2014 11:33 pm
 
Forum: Investing - Help with Personal Investments
Topic: Your Thoughts on my Portfolio
Replies: 16
Views: 1308

Re: Portfolio review

An AA between 40/60 and 60/40 would be considered mainstream for your ages. I found that going to 45/55 just before I retired resulted in my taking less interest in daily market moves. This is good!

I'm not a big fan of international - it is about 15% of my equities, 7% of total portfolio.
by Peter Foley
Mon Oct 27, 2014 12:47 pm
 
Forum: Investing - Help with Personal Investments
Topic: Portfolio review
Replies: 4
Views: 596

Re: "8 Year-End Tax Moves to Make Now"

Thanks for posting this Taylor. The advice is very solid and mainstream. To this list I would add. 9. Project your tax bracket before making any of the recommended moves. (This is not intended to mean "have the tax tail wage the dog," just as a precursor to making prudent decisions.) 10. F...
by Peter Foley
Mon Oct 27, 2014 12:40 pm
 
Forum: Investing - Theory, News & General
Topic: "8 Year-End Tax Moves to Make Now"
Replies: 9
Views: 1874

Re: New to investment planning

Regarding your wife's 403b. I looked at the pdf and on the last page it notes that expenses range from .35 to 1.25. It looks like you have to get a prospectus to see the expense ratios. Based on your approach elsewhere, I would go with the Vanguard Life Strategy Growth or Moderate Growth funds if th...
by Peter Foley
Mon Oct 27, 2014 12:28 pm
 
Forum: Investing - Help with Personal Investments
Topic: New to investment planning
Replies: 8
Views: 746

Re: Minnesota mtg | sat Nov-1 | 10:00am | agenda attached

Thanks for posting this Jeff. I'm hoping the tax presentation is in time to be helpful for this year's filing.
by Peter Foley
Sun Oct 26, 2014 7:58 pm
 
Forum: Local Chapters and Bogleheads Community
Topic: Minnesota mtg | sat Nov-1 | 10:00am | agenda attached
Replies: 6
Views: 688

Re: First Attempt at Posting my Portfolio for review

You have a lot of overlap with mutual funds in taxable, his deferred, and her deferred all holding some of the same things. High fees are bad, of course, but it is their compounding drag on returns over long periods of time that really make a difference. If you are looking at retiring in a couple ye...
by Peter Foley
Sun Oct 26, 2014 7:56 pm
 
Forum: Investing - Help with Personal Investments
Topic: First Attempt at Posting my Portfolio for review
Replies: 17
Views: 2321

Re: Adding low cost index funds to 457b? What's involved?

I don't know if 4.% is still possible. My wife and I both have stable value funds. The returns on hers are based on the dates of investment and range from 4.25% to 3.25%. My stable value pays about 3.4% and has been at that rate for about 3 years or so. You might be able to negotiate for something i...
by Peter Foley
Sun Oct 26, 2014 5:45 pm
 
Forum: Investing - Theory, News & General
Topic: Adding low cost index funds to 457b? What's involved?
Replies: 8
Views: 687

Re: SS Tax, RMD and Roth Conversions

There is one other factor that is often overlooked. For married couples, one should consider the fact that one of them will be single someday. The surviving spouse may be in a different tax bracket.
by Peter Foley
Sun Oct 26, 2014 4:47 pm
 
Forum: Personal Finance (Not Investing)
Topic: SS Tax, RMD and Roth Conversions
Replies: 6
Views: 729

Re: Calculating (IRA) RMD

jimb raises a good point and it is one that should be considered by persons approaching RMD's. For the first five years or so of RMD's, the average withdrawal is ballpark $4000 per $100,000 invested if the portfolio earns relatively little. If your portfolio does well, you will have a higher portfol...
by Peter Foley
Sun Oct 26, 2014 1:45 pm
 
Forum: Investing - Help with Personal Investments
Topic: Calculating (IRA) RMD
Replies: 7
Views: 587

Re: tax efficiency

I would say that I-bonds are the most efficient because the tax is deferred. TIPs are probably the least efficient, in part because the yield on total bond is so low. As mentioned, TIPs is a broad category. Are you talking about individual TIPs a TIPS ETF or a TIPs mutual fund?
by Peter Foley
Sat Oct 25, 2014 2:13 pm
 
Forum: Investing - Help with Personal Investments
Topic: tax efficiency
Replies: 5
Views: 865

Re: Help on Turbo Tax Long term cap gains

Cody - just a side note. I personally would not start SS benefits late in the year if they would be subject to taxation. If you were to delay until January you would only miss 2 payments. Your wife would be entitled to a slightly higher benefit and your tax situation for 2014 would be simplified. I ...
by Peter Foley
Sat Oct 25, 2014 12:25 pm
 
Forum: Personal Finance (Not Investing)
Topic: Help on Turbo Tax Long term cap gains
Replies: 29
Views: 1622

Re: Strategies of Cash offer on house

We made a cash offer on our current house. Our Realtor was my cousin and is very knowledgeable with respect to real estate, financing, negotiating, housing inspections, etc. Both my cousin and I have owned rental properties. I suggested the cash offer and we discussed it in terms of the property in ...
by Peter Foley
Fri Oct 24, 2014 4:48 pm
 
Forum: Personal Finance (Not Investing)
Topic: Strategies of Cash offer on house
Replies: 5
Views: 723

Re: How to do taxes for sale of deceased father's stocks?

While I do not remember how the Turbo Tax software did it, I was able to account for the stepped up basis on mutual fund shares and stocks when my mother died. One thing I remember was that I was careful not to commingle my mother's mutual fund shares with my own (we both held share of the same inde...
by Peter Foley
Fri Oct 24, 2014 4:14 pm
 
Forum: Personal Finance (Not Investing)
Topic: How to do taxes for sale of deceased father's stocks?
Replies: 18
Views: 1522

Re: 457b Question

I have a government 457b, as does my wife. The three facts you list are all correct with respect to government 457bs. If that is indeed what you have, I would fund that before funding a 403b as long as it did not have high expense ratios. You will have more flexibility in terms of withdrawals at an ...
by Peter Foley
Thu Oct 23, 2014 8:29 pm
 
Forum: Investing - Help with Personal Investments
Topic: 457b Question
Replies: 10
Views: 731

Re: How did you buy your largest home?

Cash. Our prior house was paid off and the cost differential to move up was not great.
by Peter Foley
Thu Oct 23, 2014 6:12 pm
 
Forum: Personal Finance (Not Investing)
Topic: How did you buy your largest home?
Replies: 25
Views: 2650

Re: Buying a car.

I used to buy used cars from private parties. I would look for something 4-6 years old with 60,000 miles or less that was rated at least average in terms of reliability by Consumer Reports. The last 4 cars I've purchased I've purchased from dealers. With a dealer I try to find a vehicle with about a...
by Peter Foley
Thu Oct 23, 2014 12:32 pm
 
Forum: Personal Finance (Not Investing)
Topic: Buying a car.
Replies: 9
Views: 751

Re: Just wondering how you personally calculate net worth

I don't tax adjust because I don't know what the tax rate will be on the various components. I have run the calculation to create a reasonable estimate and have that saved on a separate tab.

Minnesota has a low inheritance tax threshold and that complicates matters a great deal.
by Peter Foley
Thu Oct 23, 2014 12:18 pm
 
Forum: Personal Finance (Not Investing)
Topic: Just wondering how you personally calculate net worth
Replies: 56
Views: 3724

Re: Young Investors Plan – I'm Firing Questions!

tchasteen wrote: During the first several years all of my money will go into the Vanguard Total Stock Market Index Fund until I have 40,000 invested. After that I will put the next 10,000 into the bond fund followed by 10,000 in the international stock fund and then adjust as needed to get the asset...
by Peter Foley
Thu Oct 23, 2014 12:10 pm
 
Forum: Investing - Help with Personal Investments
Topic: Young Investors Plan – I'm Firing Questions!
Replies: 13
Views: 1751

Re: 401k is a mess of managed & index funds, seeking help

While I agree with the recommendations, you really shouldn't be so hard on yourself. You had a well diversified mix of relatively low cost funds, albeit at the expense of overlap. Ruralavalon's suggestions offer two approaches which are much simpler and lower in cost.
by Peter Foley
Thu Oct 23, 2014 11:51 am
 
Forum: Investing - Help with Personal Investments
Topic: 401k is a mess of managed & index funds, seeking help
Replies: 9
Views: 635

Re: Which lots do you sell when redeeming shares?

If I were in the 15% tax bracket I would sell the lowest cost shares that did not bump me into the 15% bracket. If in the 25% bracket I would sell the highest cost shares if profits from the sale were classified as long term capital gains. Not the issue at hand, but if you donate shares to a donor a...
by Peter Foley
Wed Oct 22, 2014 1:47 pm
 
Forum: Investing - Theory, News & General
Topic: Which lots do you sell when redeeming shares?
Replies: 14
Views: 920

Re: Taxable account

Welcome to the forum. Do note that your retirement accounts and your wife's retirement accounts are independent. What you do with your accounts has no impact on hers.
by Peter Foley
Mon Oct 20, 2014 9:58 pm
 
Forum: Investing - Help with Personal Investments
Topic: Taxable account
Replies: 4
Views: 959

Re: Shoes for Plantar Fasciitis?

I suffered from Plantar Fasciitis for a few years before figuring out what it was. I switched running shoes to a New Balance model designed to counter PF. It went away over the course of a couple months and has never returned. I was also told that I was wearing my shoes too long - that they were not...
by Peter Foley
Mon Oct 20, 2014 6:59 pm
 
Forum: Personal Consumer Issues
Topic: Shoes for Plantar Fasciitis?
Replies: 47
Views: 2356

Re: Help me choose... [Retirement withdrawal strategy]

I would go with either the age in bonds or the bucket approach. However, with more details I would be able to say more definitively which of those two I would prefer. Questions: 1. Do you expect to spend most, if not all of your retirement savings, or are you likely to leave a substantial inheritanc...
by Peter Foley
Sun Oct 19, 2014 11:47 am
 
Forum: Personal Finance (Not Investing)
Topic: Help me choose... [Retirement withdrawal strategy]
Replies: 12
Views: 1278

Re: What will you do when you retire?

My solution to retirement activities took a lot of advance planning. 30 + years ago we had two children. We got them married off [ :wink: ] about 5 years ago. We retired in May of 2012 and our first grandchild was born in September (just after I had finished my to do list). Our second grandchild was...
by Peter Foley
Sun Oct 19, 2014 11:31 am
 
Forum: Local Chapters and Bogleheads Community
Topic: What will you do when you retire?
Replies: 37
Views: 3708

Re: Youngish Investor Advice?

Welcome to the forum. With little debt and some savings you are on track for your age. The following is from Fidelity: While every individual’s situation will differ greatly based on desired lifestyle in retirement, the average worker may replace 85 percent of his pre-retirement income by saving at ...
by Peter Foley
Fri Oct 17, 2014 6:07 pm
 
Forum: Investing - Help with Personal Investments
Topic: Youngish Investor Advice?
Replies: 6
Views: 680

Re: Teaching A Class, What Investment Advice Do I Give?

I've given a few seminars on investing. One of the visuals I use is the Callan table of investment returns. It shows that some outset classes out perform for a few years then under perform. I also talk about the psychology of investing - avoiding pain and seeking pleasure make us poorly wired for bu...
by Peter Foley
Thu Oct 16, 2014 3:30 pm
 
Forum: Investing - Help with Personal Investments
Topic: Teaching A Class, What Investment Advice Do I Give?
Replies: 20
Views: 1891

Re: Marginal Tax Rate Question/Confusion

While the 15% bracket tops out a $73,800 in 2014, that's not going to help much. After reducing your income with your 401k contributions, you will have about $130,000 in AGI. Estimate your itemized deductions at 20,000 and 4 exemptions @3950 = 15,800. That gets you to $95,000 in taxable income. Soli...
by Peter Foley
Thu Oct 16, 2014 3:11 pm
 
Forum: Investing - Help with Personal Investments
Topic: Marginal Tax Rate Question/Confusion
Replies: 16
Views: 1214

Re: Advice with medium-term investing

One option would be to invest in a utility fund that pays a decent dividend. This is not risk free, however, and you might want to make adjustments elsewhere to maintain your desired AA. IMHO 5 year CD rates are not a good option. With those, one is likely to lose buying power to inflation. There ar...
by Peter Foley
Thu Oct 16, 2014 12:37 pm
 
Forum: Investing - Help with Personal Investments
Topic: Advice with medium-term investing
Replies: 6
Views: 547

Re: Please help with my assest allocation I think I did it r

I think you got it right. You have a broadly diversified portfolio and have chosen low cost funds where available. That does not mean you couldn't do things a bit differently, as you are a little light on fixed income. ( I count only the stable value and her total bond.) Your choices in the 457b are...
by Peter Foley
Wed Oct 15, 2014 5:46 pm
 
Forum: Investing - Help with Personal Investments
Topic: Please help with my assest allocation I think I did it right
Replies: 12
Views: 924

Re: Help on Turbo Tax Long term cap gains

I probably muddied the waters a bit. I know that neither pension is particularly generous, in fact one is fairly small.
by Peter Foley
Wed Oct 15, 2014 5:20 pm
 
Forum: Personal Finance (Not Investing)
Topic: Help on Turbo Tax Long term cap gains
Replies: 29
Views: 1622

Re: Withdrawal Strategies

Without more details it is hard to say. If your father is single and is planning on income of $50,000 per year from various sources, a mix of withdrawals from taxable and tax deferred will likely give him the most spendable income (lower taxes) over a long period of time. At a modified AGI of $34,00...
by Peter Foley
Wed Oct 15, 2014 12:11 pm
 
Forum: Investing - Help with Personal Investments
Topic: Withdrawal Strategies
Replies: 4
Views: 464

Re: Help on Turbo Tax Long term cap gains

If I remember your situation correctly, your pension + you wife's pension + SS? might be what is causing the increase. Put in a smaller amount and see if it goes up. If it does it is probably an increase in taxation of SS benefits.
by Peter Foley
Tue Oct 14, 2014 6:16 pm
 
Forum: Personal Finance (Not Investing)
Topic: Help on Turbo Tax Long term cap gains
Replies: 29
Views: 1622

Re: Roth or Traditional IRA

Something to consider: $73,800 in taxable income is the top of the 15% tax bracket. You make $110,000/ year. Let's ballpark your deductions and exemptions at $25,000 so that puts you at about $85,000 in taxable income. If you put $15,000 in your 401k, you will be at $70,000 in taxable income. That i...
by Peter Foley
Tue Oct 14, 2014 6:10 pm
 
Forum: Investing - Help with Personal Investments
Topic: Roth or Traditional IRA
Replies: 5
Views: 375

Re: Am I on track? Please take a look.

You are doing just fine. Both Fidelity and Money Magazine recently had articles regarding age based savings. Here is a quote from Fidelity: While every individual’s situation will differ greatly based on desired lifestyle in retirement, the average worker may replace 85 percent of his pre-retirement...
by Peter Foley
Tue Oct 14, 2014 5:25 pm
 
Forum: Investing - Help with Personal Investments
Topic: Am I on track? Please take a look.
Replies: 4
Views: 681

Re: Relatively new here. What did you do in 2008/09

I was a relatively new Boglehead. I rebalanced a few times on the way down but could not pull the trigger to rebalance below about 1000 on the S&P 500. As I was planning on a late 2010 retirement I didn't feel I could put more at risk. I also rebalanced on the way up in 2010 and moved a bit towa...
by Peter Foley
Tue Oct 14, 2014 5:20 pm
 
Forum: Investing - Help with Personal Investments
Topic: Relatively new here. What did you do in 2008/09
Replies: 106
Views: 7047

Re: Please Help: Portfolio Advice

I like Duckie's suggestion. The main point I would make is that you can be very well diversified with a portfolio that is easier to manage. You have good choices in your 401k. You can limit your Roth to a single fund that compliments your other holdings.
by Peter Foley
Mon Oct 13, 2014 5:18 pm
 
Forum: Investing - Help with Personal Investments
Topic: Please Help: Portfolio Advice
Replies: 2
Views: 295

Re: AA: taxable versus non-taxable and allocation calculatio

I don't regularly tax adjust my AA. I have done so but it is really just an estimate. What will your tax rate be when you make withdrawal from a 401K? Will you be in the 15% or 25% bracket when you take some profits in taxable? In other words, you can approximate, but it is really hard to be accurat...
by Peter Foley
Mon Oct 13, 2014 5:11 pm
 
Forum: Investing - Help with Personal Investments
Topic: AA: taxable versus non-taxable and allocation calculations
Replies: 11
Views: 590

Re: Is Probate Required?

bsteiner I know from prior posting that you are an expert in this area. Doesn't probate for small estates depend primarily on state law? I know ownership of real estate can be an issue. My wife's parents are both in their mid 90's and she and her siblings have tried to simplify things in recent years.
by Peter Foley
Sun Oct 12, 2014 10:53 am
 
Forum: Personal Finance (Not Investing)
Topic: Is Probate Required?
Replies: 9
Views: 849

Re: I Bonds - Best redemption strategy

I'm with John on this one . . . I'll hold them for as long a I can. I do believe that they can be cashed tax free for certain educational expenses - I don't know the details, but that may be part of the solution for some.
by Peter Foley
Sun Oct 12, 2014 10:47 am
 
Forum: Investing - Theory, News & General
Topic: I Bonds - Best redemption strategy
Replies: 13
Views: 1391

Re: Sell Taxable to Fund Roth?

I would say yes if you are in the 15% marginal tax bracket.
by Peter Foley
Sun Oct 12, 2014 10:44 am
 
Forum: Investing - Help with Personal Investments
Topic: Sell Taxable to Fund Roth?
Replies: 6
Views: 479

Re: Fixed Income Investments In Tax Deferred Accounts?

rbj112 wrote: Conventional advice is also to delay withdrawals from the tax deferred accounts as long as possible, preferably until age 70 1/2 for the Required Minimum Distributions. The reason for not withdrawing from the tax deferred accounts is because 100% of that is subject to income tax upon w...
by Peter Foley
Sun Oct 12, 2014 10:41 am
 
Forum: Investing - Theory, News & General
Topic: Fixed Income Investments In Tax Deferred Accounts?
Replies: 6
Views: 503

Re: Portfolio Review Question

Be mindful that a government 457 account is more flexible in terms of withdrawals than a 401k. If you think your wife might retire early ( pre 59.5), the 457 is a no brainer.
by Peter Foley
Sat Oct 11, 2014 11:12 pm
 
Forum: Investing - Help with Personal Investments
Topic: Portfolio Review Question
Replies: 18
Views: 1213

Re: Threshold for [Resetting Roth Conversion]

Alan S. wrote: I think more people use strategies less focused on minimizing the conversion cost and use recharacterization strategies on the back end of the time window. One popular strategy is to do multiple conversions invested in ways that have minimal correlation with each other. They will look...
by Peter Foley
Fri Oct 10, 2014 11:31 pm
 
Forum: Personal Finance (Not Investing)
Topic: Threshold for [Resetting Roth Conversion]
Replies: 16
Views: 1563
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