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Re: rebalancing towards bernstien philosophy

If I added correctly you have about $6M. Putting half of it in fixed and managing the other half at 70/30 is a very conservative approach. I would probably manage the second half at 80/20 so as to be closer to 40/60 overall. Also, I would pay off my mortgage now. If you are in the highest tax bracke...
by Peter Foley
Tue Sep 30, 2014 3:43 pm
 
Forum: Investing - Help with Personal Investments
Topic: rebalancing towards bernstien philosophy
Replies: 3
Views: 386

Re: When should someone "not stay the course"?

crake wrote I would say the time "not stay the course" would be when the inputs which went into creating your initial IPS have changed or when you acquire some new knowledge which you didn't have at the time you created your IPS. I agree with crake. I would guess that most of us here have ...
by Peter Foley
Tue Sep 30, 2014 3:32 pm
 
Forum: Investing - Theory, News & General
Topic: When should someone "not stay the course"?
Replies: 43
Views: 2374

Re: 401k GICs, Fixed Accounts, etc.

Will, So much depends on the viability of the company when it come to their stable value fund. I would be tempted to stay with it for another year or two until we see how the market responds to changes in interest rates. Are all of your holding with the previous employer in the "fixed account&q...
by Peter Foley
Tue Sep 30, 2014 1:39 pm
 
Forum: Investing - Help with Personal Investments
Topic: 401k GICs, Fixed Accounts, etc.
Replies: 4
Views: 233

Re: Help for New Investor

Some thoughts . . . You are fairly well diversified but have some overlap among your funds. I think your AA is a bit high, I prefer 80/20. For now I would not worry about TIPS and REITS. May take a look at them when you have $50,000 in your retirement account and you feel a need for more diversifica...
by Peter Foley
Tue Sep 30, 2014 1:32 pm
 
Forum: Investing - Help with Personal Investments
Topic: Help for New Investor
Replies: 4
Views: 230

Re: Portfolio Help, Please

reyarey

Ruralavalon did a very thorough job of how to invest should the TD Ameritrade option be viable with respect to costs. I would follow his advice.

If it is not, The Dryfus S&P 500 should be your principal holding in your 403bs with Lincoln.
by Peter Foley
Sun Sep 21, 2014 11:07 pm
 
Forum: Investing - Help with Personal Investments
Topic: Portfolio Help, Please
Replies: 14
Views: 1177

Re: About to Retire, Need Help!

To decide from where to draw income during their first years in retirement, you have to know what their taxable income will be in each year. The top of the 15% federal tax bracket in about $74,000 for married filing jointly. The rental real estate income makes this difficult for individuals posting ...
by Peter Foley
Sun Sep 21, 2014 10:55 pm
 
Forum: Investing - Help with Personal Investments
Topic: About to Retire, Need Help!
Replies: 25
Views: 2955

Re: Portfolio Help, Please

Welcome to the forum. You are correct that you do not have a lot of low cost options available in your 403bs, especially those with Lincoln Financial. You don't mention what the cost is to invest with TD Ameritrade other than the cost per trade. Is there an annual management fee? Ignoring the TD Ame...
by Peter Foley
Fri Sep 19, 2014 9:32 pm
 
Forum: Investing - Help with Personal Investments
Topic: Portfolio Help, Please
Replies: 14
Views: 1177

Re: When did you feel "Out of the Woods"?

I was 30 when my wife and I married. We had a house but rented out the upstairs to college friends for the first 5 years we owned it. About the time my second daughter was born (I was 34) I got a promotion and a decent pay raise. By age 35 we were saving a bit and paying down our mortgage. Day care ...
by Peter Foley
Fri Sep 19, 2014 8:45 pm
 
Forum: Personal Finance (Not Investing)
Topic: When did you feel "Out of the Woods"?
Replies: 42
Views: 5329

Re: No plan till today, not even frame work

Yes you do need a plan. Central to that plan would be diversification. Bogleheads in general tend toward owning the whole market rather than a single market segment. That whole market includes all US stocks , all international stocks and (at least) all US bonds. Read a bit about the 3-fund portfolio.
by Peter Foley
Fri Sep 19, 2014 8:36 pm
 
Forum: Investing - Help with Personal Investments
Topic: No plan till today, not even frame work
Replies: 7
Views: 825

Re: Hypothetical Question

I like Grabiner's suggestion. If you've not started withdrawals by age 69 you are no doubt in good shape. Increasing to about 60% stocks over the course of a few years is the approach that I would take. Have you figured out what tax bracket you will be in when you take RMD's? Is it much higher than ...
by Peter Foley
Fri Sep 19, 2014 8:30 pm
 
Forum: Investing - Help with Personal Investments
Topic: Hypothetical Question [Portfolio help]
Replies: 10
Views: 723

Re: Stove - repair or replace

Per Consumer Reports August 2011 (there may be a newer article): Repair or Replace

Gas Range: 1-4 years old, repair, 4-7 consider repairing, 8 or more replace. Median replacement cost was $700. Gas ranges were noted as expensive to repair.
by Peter Foley
Mon Sep 15, 2014 9:48 pm
 
Forum: Personal Consumer Issues
Topic: Stove - repair or replace
Replies: 9
Views: 571

Re: Draw Taxable Investments First?

If you will be in the 15% bracket when taking SS and RMDs you are in good shape taxwise already. (You not be living very comfortably, but that is another issue.)

When you consider SS benefits, you can't just look at the published tax brackets. Check out SS taxation on the Wiki.
by Peter Foley
Mon Sep 15, 2014 9:40 pm
 
Forum: Personal Finance (Not Investing)
Topic: Draw Taxable Investments First?
Replies: 6
Views: 626

Re: Equity Allocation Review

Based on the summary you provided, you are very well diversified. I would try to do it with fewer funds. You only need total stock market, total international and emerging markets to cover equities. I'm not sure of what you tax consequences might be in getting there. Could your wife manage this mix ...
by Peter Foley
Mon Sep 15, 2014 9:34 pm
 
Forum: Investing - Help with Personal Investments
Topic: Equity Allocation Review
Replies: 8
Views: 484

Re: Roth stock/bond allocation

Since you will in effect be dollar cost averaging into the Roth, I would go 100% stocks.
by Peter Foley
Mon Sep 15, 2014 9:28 pm
 
Forum: Investing - Theory, News & General
Topic: Roth stock/bond allocation
Replies: 8
Views: 675

Re: What's in your tax advantage accounts?

Sorry for the late replay to the OP.

In my Roth accounts I hold only Total Stock Market and Total International. I prefer simplicity to slicing and dicing when it comes to equities.
by Peter Foley
Mon Sep 15, 2014 4:32 pm
 
Forum: Investing - Theory, News & General
Topic: What's in your tax advantage accounts?
Replies: 54
Views: 3931

Re: Portfolio Advice Needed - Thanks!

A few thoughts: I would eventually want 20% to 30% in international. You are just starting out, you don't need to diversify into international from day one. I don't like the high expense ratios in your SIMPLE. Do you have any low cost options? If not, you are correct that the disadvantage of high co...
by Peter Foley
Sun Sep 14, 2014 10:45 pm
 
Forum: Investing - Help with Personal Investments
Topic: Portfolio Advice Needed - Thanks!
Replies: 4
Views: 463

Re: What's in your tax advantage accounts?

For the most part my pretax accounts have stable value funds, TIPS funds and Total Bond market funds. Because most of my savings are in pretax I also have a bit of International and S&P 500. Non equities clearly dominate. Maybe as much as 70% to 75%.

I do not hold any bond funds in Roths.
by Peter Foley
Sun Sep 14, 2014 9:13 pm
 
Forum: Investing - Theory, News & General
Topic: What's in your tax advantage accounts?
Replies: 54
Views: 3931

Re: Help with allocation

If you sold during the last major market downturn, you might not have the risk tolerance to hold as much in stocks as you proposed. I would certain consider a 60/40 asset allocation.

I think market downtown was a typo - market downturn is what was likely intended.
by Peter Foley
Sun Sep 14, 2014 12:17 am
 
Forum: Investing - Help with Personal Investments
Topic: Help with allocation
Replies: 6
Views: 543

Re: IRA to Roth conversion after retirement ?

bertilak wrote: I don't think it is necessary to be real exact on that and going over a bit really makes little difference because only that "little bit" will be subject to the 25% tax. I agree. I plan on overshooting into the 25% bracket a bit and late in the year look to see if I can bun...
by Peter Foley
Sat Sep 13, 2014 11:46 am
 
Forum: Investing - Help with Personal Investments
Topic: IRA to Roth conversion after retirement ?
Replies: 14
Views: 1379

Re: Help with allocation

Did you have money invested during the last recession? If yes, how did you react? Did you continue to invest in stocks, did you sell? If you were able to stay the course and not sell an aggressive AA might be okay for you. I would still, however, dial it back to 70/30. With all your funds in a Roth ...
by Peter Foley
Sat Sep 13, 2014 11:37 am
 
Forum: Investing - Help with Personal Investments
Topic: Help with allocation
Replies: 6
Views: 543

Re: IRA to Roth conversion after retirement ?

JohnFiscal My wife and I are in a similar situation, although more of our savings are in deferred accounts. I retired 2+ years ago at age 61.5 and my wife went to part time work that same year at age 56. Using the tax software is a good suggestion. In our case, I always planned to delay SS until at ...
by Peter Foley
Fri Sep 12, 2014 8:58 pm
 
Forum: Investing - Help with Personal Investments
Topic: IRA to Roth conversion after retirement ?
Replies: 14
Views: 1379

Re: Clean, quiet, safe and cheap. Is there such a travel pla

If you avoid the ski season, the Aosta Valley in Italy is very nice. There are hostels there that are very inexpensive during the shoulder seasons.
by Peter Foley
Fri Sep 12, 2014 8:26 pm
 
Forum: Personal Consumer Issues
Topic: Clean, quiet, safe and cheap. Is there such a travel place?
Replies: 75
Views: 5751

Re: Don't even know where to start on this AARP article

flyingaway I too thought the article was misleading, if not sensationalist. Your quote from the article should tip off more sophisticated readers. The key to not overpaying taxes is to determine whether your tax bracket will be higher or lower in retirement, which can be tricky to do. For example, $...
by Peter Foley
Fri Sep 12, 2014 4:45 pm
 
Forum: Personal Finance (Not Investing)
Topic: Don't even know where to start on this AARP article
Replies: 38
Views: 4982

Re: AARP Bulletin mentions Bogleheads Guide to Retirement Pl

The books recommended are as follows: Roadmap for the Rest of Your Life – AARP – Bart Astor Can I Retire – Mike Piper Money for Life – Steve Vernon Bogleheads’ Guide to Retirement Planning - Taylor Larimore et. al. (editors) How to Retire Happy, Wild and Free – Ernie Zelinski There is a very brief d...
by Peter Foley
Wed Sep 10, 2014 11:54 pm
 
Forum: Investing - Theory, News & General
Topic: AARP Bulletin mentions Bogleheads Guide to Retirement Planni
Replies: 11
Views: 751

Re: Low Income Investor (Tax Concerns)

When one owns a stock mutual fund like the S&P 500, that person receives dividends and perhaps some capital gains each year. (Unless you sell the fund - then there are capital gains, but that doesn't seem to be your scenario.) If a single person earns less than $36,900* in taxable income, qualif...
by Peter Foley
Wed Sep 10, 2014 11:24 pm
 
Forum: Investing - Help with Personal Investments
Topic: Low Income Investor (Tax Concerns)
Replies: 31
Views: 1866

Re: Suggestions for a Western States road trip?

You could have snow by now in Glacier - I would stay further south. There is a Mammoth site in SD near Hot Springs. I too would recommend the Wind Caves. Fort Laramie is interesting and nearby are the wagon ruts made by the settlers as they headed west. (Not a big deal, but worth a couple hours if y...
by Peter Foley
Wed Sep 10, 2014 5:04 pm
 
Forum: Personal Consumer Issues
Topic: Suggestions for a Western States road trip?
Replies: 20
Views: 1690

Re: Favorite airbnb/vrbo properties?

We have used VRBO a number of times. Locations included Paris, Barcelona, Puerto Rico, Hawaii (Kona) and Hawaii ( Kauai). Paris, Puerto Rico and Kona were all fine. The Barcelona property was fine, but we received notice about 10 day prior to departure that the property we had selected had damage an...
by Peter Foley
Wed Sep 10, 2014 4:55 pm
 
Forum: Personal Consumer Issues
Topic: Favorite airbnb/vrbo properties?
Replies: 7
Views: 985

Re: Roth conversion question

The first bolded sentence is just to let you know that a conversion is a distribution and is treated like ordinary income. At the end of the year your must withhold at least 90% of your expected tax or 100% of the tax you owed last year, 110% of last year's tax for higher income filers. (2013 IRS Pu...
by Peter Foley
Tue Sep 09, 2014 5:37 pm
 
Forum: Investing - Help with Personal Investments
Topic: Roth conversion question
Replies: 16
Views: 1190

Re: What investments for IRA account?

If you intend to hold the IRAs as traditional IRAs long term, I would put bonds in the IRAs. You will want to hold most of your equities in your taxable account. Sidebar: You say you will have no earned income. The recent inheritance with a stepped up basis might offer you a source of tax free incom...
by Peter Foley
Mon Sep 08, 2014 9:03 pm
 
Forum: Investing - Help with Personal Investments
Topic: What investments for IRA account?
Replies: 2
Views: 235

Re: Helping Mother In-Law With Retirement Planning

Yes I would recommend a slight more conservative approach. Rather than a 60/40 AA I would go with a 40/60 AA, 50/50 at the highest. If I understand correctly, there is not much room for a bad sequence of returns.
by Peter Foley
Mon Sep 08, 2014 5:14 pm
 
Forum: Investing - Help with Personal Investments
Topic: Helping Mother In-Law With Retirement Planning
Replies: 36
Views: 2048

Re: Simplicity vs. Complexity

Taylor wrote: We must avoid making the mistake of adding more funds simply because Wall Street's marketing machine keeps churning out ever more options. I agree with your premise as stated. The comparison does have some recency bias as we have not had a spate of high inflation in about 25 years. Eve...
by Peter Foley
Mon Sep 08, 2014 5:10 pm
 
Forum: Investing - Theory, News & General
Topic: Simplicity vs. Complexity
Replies: 50
Views: 3340

Re: How often do you really change your email passwords?

About once a year or after an e-mail breach is reported.
by Peter Foley
Mon Sep 08, 2014 4:55 pm
 
Forum: Personal Consumer Issues
Topic: How often do you really change your email passwords?
Replies: 17
Views: 704

Re: Roth IRA Question

Hi John, welcome to the forum. Just to clarify . . we are not nosy, we would provide advice that would help you use your Roth to compliment your 401k, but we have to know what options are available in the 401k first. The 401k might have a couple good low cost options that one could build around, or ...
by Peter Foley
Sun Sep 07, 2014 9:33 pm
 
Forum: Investing - Help with Personal Investments
Topic: Roth IRA Question
Replies: 6
Views: 575

Re: Considering divesting international position...

I would not divest international. It has under performed in recent years. I would be inclined to increase my international slightly. I don't know if your international is hedged or not for currency. Note that the Euro is quite low compared to the dollar. It is about as low as it has been in the past...
by Peter Foley
Sat Sep 06, 2014 6:08 pm
 
Forum: Investing - Help with Personal Investments
Topic: Considering divesting international position...
Replies: 12
Views: 594

Re: Q for those of you over 59.5 YO and a Roth IRA

I have a Roth and am 63.5. I retired at age 61. I have capital gains and dividends reinvested within the Roth. Most of our money is in tax deferred (401k and 403b) so we will not tap our Roths for at least 20 years. Our Roths are relatively small as we were not able to contribute to them for many ye...
by Peter Foley
Sat Sep 06, 2014 6:02 pm
 
Forum: Investing - Help with Personal Investments
Topic: Q for those of you over 59.5 YO and a Roth IRA
Replies: 11
Views: 1209

Re: Cash to draw on - Safe Withdrawal Rate

There are a couple other options that could help define the "notion" of safe withdrawal. The original Trinity Study showed a portfolio survival rate of 100% for a bonds only portfolio over 25 years. Granted bonds are not cash. The survival rate for a 100% bond allocation dropped to 80% ove...
by Peter Foley
Sat Sep 06, 2014 12:23 pm
 
Forum: Investing - Theory, News & General
Topic: Cash to draw on - Safe Withdrawal Rate
Replies: 10
Views: 1080

Re: A 'really good book' you did NOT enjoy

Ulysses - James Joyce
by Peter Foley
Sat Sep 06, 2014 10:29 am
 
Forum: Personal Consumer Issues
Topic: A 'really good book' you did NOT enjoy
Replies: 226
Views: 10984

Re: Principal Protection

NEpt I'm going to rephrase your goal (and indeed this may not be what your are looking for). Which Vanguard fund most close matches "preserving current buying power" while maximizing principal preservation and minimizing gains? My suggestion would be to look at something like a Target Reti...
by Peter Foley
Fri Sep 05, 2014 3:09 pm
 
Forum: Investing - Help with Personal Investments
Topic: Principal Protection
Replies: 44
Views: 2047

Re: Help with my parent's finances

I will echo the advice to refinance the mortgage. I assume they could afford the higher monthly payments so they should go with a 15 year mortgage (or with a 7 year ARM as freddie recommended).
by Peter Foley
Thu Sep 04, 2014 4:06 pm
 
Forum: Investing - Help with Personal Investments
Topic: Help with my parent's finances
Replies: 21
Views: 1908

Re: Wiki revised - Employer Retirement Plan Overview

Lady Geek wrote: The IRS defines a 403(b) as a Tax-Sheltered Annuity Plan I interpret annuity to be a financial product which makes periodic payments. It's not tied to insurance, which is what I think you are alluding to. I also interpret annuity to mean a financial product that makes periodic payme...
by Peter Foley
Tue Sep 02, 2014 6:05 pm
 
Forum: Personal Finance (Not Investing)
Topic: Wiki revised - Employer Retirement Plan Overview
Replies: 6
Views: 748

Re: Retirement Investment Advice needed.

At that rate paying down your mortgage would be just an OK option. You are in the 15% tax bracket so you are not getting a great tax break with your interest payments even if you are itemizing. Your lowest cost fund in your 401k is the small cap fund. At a minimum you should hold your small caps the...
by Peter Foley
Tue Sep 02, 2014 5:53 pm
 
Forum: Investing - Help with Personal Investments
Topic: Retirement Investment Advice needed.
Replies: 4
Views: 817

Re: Bucket Path - Asset Allocation

pop77 Asset allocation and its cousin, rebalancing, are really more about controlling risk than increasing the overall return of the portfolio. That being said, the sequence of returns in the future MIGHT favor someone who diversifies from day one and then rebalances. That lucky person could benefit...
by Peter Foley
Tue Sep 02, 2014 3:44 pm
 
Forum: Investing - Theory, News & General
Topic: Bucket Path - Asset Allocation
Replies: 7
Views: 730

Re: Retirement Investment Advice needed.

Without researching the funds you have available in your 401k, I would just advise you to take advantage of the lowest funds there ( maybe the COL SM Cap and the lowest cost bond fund) and do your Total Stock and Total international in your Roths. You really don't have a good low cost fund in your 4...
by Peter Foley
Tue Sep 02, 2014 12:02 am
 
Forum: Investing - Help with Personal Investments
Topic: Retirement Investment Advice needed.
Replies: 4
Views: 817

Re: Only one international fund in 401K. Use it??

I would just skip it. The best place to hold international (and holding it is optional) is in taxable.
by Peter Foley
Mon Sep 01, 2014 11:26 pm
 
Forum: Investing - Help with Personal Investments
Topic: Only one international fund in 401K. Use it??
Replies: 4
Views: 326

Re: Do my in-laws need a will?

If for no other reason I would want the will so that my surviving spouse would have an easy a time as possible dealing with our financial affairs. They each might have a few personal items they would like to pass on to someone other than each other and a will is a way to do that without creating har...
by Peter Foley
Mon Sep 01, 2014 9:54 pm
 
Forum: Personal Finance (Not Investing)
Topic: Do my in-laws need a will?
Replies: 26
Views: 1867

Re: Hello new to the boards [If retirement funds not used up

The only reason I can think of offhand is related to estate planning. If you want to leave an inheritance for someone, taxable get a stepped up basis upon death so that is fine. With a Roth, the contributions and earnings are tax free so that is fine too. I wouldn't invest in a 401k (or Traditional ...
by Peter Foley
Mon Sep 01, 2014 9:38 pm
 
Forum: Investing - Help with Personal Investments
Topic: Hello new to the boards [If retirement funds not used up?]
Replies: 20
Views: 1205

Re: When to take Social Security

sscritic can correct me if I'm wrong, but I believe that SS stops indexing one's wages to inflation for benefit calculation purposes at about age 60. If your wages are truly flat from age 66 to 70, the additional earnings may not matter at all. Again, technovelist is correct, if you don't have 35 ye...
by Peter Foley
Fri Aug 29, 2014 3:03 pm
 
Forum: Investing - Help with Personal Investments
Topic: When to take Social Security
Replies: 4
Views: 584

Re: Which book to start with?

Based on your college studies, I too would recommend starting with the Bogleheads' Guide to Investing. After that I would recommend the Four Pillars of Investing (Bernstein) as that will provide you with a good understanding of the rationale behind index investing. From there I would go to Rick Ferr...
by Peter Foley
Fri Aug 29, 2014 2:55 pm
 
Forum: Investing - Help with Personal Investments
Topic: Which book to start with?
Replies: 6
Views: 322

Re: Looking for advice/critique

Stephan wrote: Questions: 1. Is our international and emerging, as compared to domestic equity allocation unhelpfully aggressive, even with a 30-40 year time horizon? I'm fine with your choices given the long time horizon. 2. Should we be putting less money towards extra principal on our mortgage? N...
by Peter Foley
Thu Aug 28, 2014 9:58 pm
 
Forum: Investing - Help with Personal Investments
Topic: Looking for advice/critique
Replies: 17
Views: 1640

Re: Wiki revised - Employer Retirement Plan Overview

While the wiki may be using the language of the DOL website, as a participant in a government 457b plan, and with fair knowledge of my wife's 403b (University) plan, I find some of the terminology confusing. I will provide a couple examples. Government 457b plan is a "non-qualified tax-deferred...
by Peter Foley
Thu Aug 28, 2014 9:24 pm
 
Forum: Personal Finance (Not Investing)
Topic: Wiki revised - Employer Retirement Plan Overview
Replies: 6
Views: 748
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