Search found 29 matches

Return to advanced search

Re: Vanguard 529 Plan or PA 529 or other?

We were fairly unique, the sixty of us, in that there wasn't one good mixer in the bunch — J. D. Salinger
by PortlandHead
Fri May 03, 2013 7:39 am
 
Forum: Investing - Help with Personal Investments
Topic: Vanguard 529 Plan or PA 529 or other?
Replies: 23
Views: 1728

Re: Portfolio Q&A -- Probably Some Low-Hanging Fruit!

[Still talking about investing the money instead of paying the debt -- feel free to ignore] I really only have three premises here: 1. My portfolio returning greater than 3% annually over ten years is more likely than not. 2. The magnitude of the risk is such that I can bear the consequences if I'm ...
by PortlandHead
Thu May 02, 2013 7:19 pm
 
Forum: Investing - Help with Personal Investments
Topic: Portfolio Q&A -- Probably Some Low-Hanging Fruit!
Replies: 66
Views: 3001

Re: Portfolio Q&A -- Probably Some Low-Hanging Fruit!

I would simply tell you that if the market drops 25% in the year that you hit $200K and have to make the $150K balloon payment, you won't feel happy paying that entire amount (now $150K after the drop) without a possibility of recovering it. Whereas I watched my portfolio plummet, but because I did...
by PortlandHead
Thu May 02, 2013 6:19 pm
 
Forum: Investing - Help with Personal Investments
Topic: Portfolio Q&A -- Probably Some Low-Hanging Fruit!
Replies: 66
Views: 3001

Re: Portfolio Q&A -- Probably Some Low-Hanging Fruit!

If you could save more, it should go into Her 401k. Notwithstanding the poor options? Why is that a better choice than me opening a Trad IRA? One allocation can take all of your goals into account, but we usually suggest keeping them separate. Meaning allocate for each as if it were the only portfo...
by PortlandHead
Thu May 02, 2013 4:13 pm
 
Forum: Investing - Help with Personal Investments
Topic: Portfolio Q&A -- Probably Some Low-Hanging Fruit!
Replies: 66
Views: 3001

Re: Portfolio Q&A -- Probably Some Low-Hanging Fruit!

On the retirement front: I am convinced to begin maxing out my 401k contributions and will make that change. My wife will be doing 5.5k worth of backdoor Roth per year, in addition to the minimum 401k contribution to get her employer match. I'm moving her old IRA over to Vanguard. That will be an an...
by PortlandHead
Thu May 02, 2013 3:46 pm
 
Forum: Investing - Help with Personal Investments
Topic: Portfolio Q&A -- Probably Some Low-Hanging Fruit!
Replies: 66
Views: 3001

Re: Vanguard 529 Plan or PA 529 or other?

All of the plans have websites on which you can learn about the investment options and the expense ratios. Edited: Pennsylvania appears to be unique in offering state income tax deductions for contributions to out-of-state 529s, and exempting qualified withdrawals from out-of-state plans from income...
by PortlandHead
Thu May 02, 2013 9:13 am
 
Forum: Investing - Help with Personal Investments
Topic: Vanguard 529 Plan or PA 529 or other?
Replies: 23
Views: 1728

Re: Portfolio Q&A -- Probably Some Low-Hanging Fruit!

50,000+12k/yr. needs a rate of return of 3% to reach over $200k after taxes in 10 years, assuming monthly compounding. (My wife pays the capital gains on this account.)
by PortlandHead
Thu May 02, 2013 7:15 am
 
Forum: Investing - Help with Personal Investments
Topic: Portfolio Q&A -- Probably Some Low-Hanging Fruit!
Replies: 66
Views: 3001

Re: Portfolio Q&A -- Probably Some Low-Hanging Fruit!

Fair enough. Not all wisdom can be articulated in numbers.

I hope my pushback on the debt issue hasn't come across as too petulant. I really am just trying to understand and make rational choices.

Once I get the retirement info we can proceed on that front.
by PortlandHead
Wed May 01, 2013 5:59 am
 
Forum: Investing - Help with Personal Investments
Topic: Portfolio Q&A -- Probably Some Low-Hanging Fruit!
Replies: 66
Views: 3001

Re: Portfolio Q&A -- Probably Some Low-Hanging Fruit!

I have on aside to point out, as a mid high rate tax payer (28/25% respectively) Why would you and your wife choose to file married filing separately, if you have a legitimate reason I could understand, but mathematically especially with a dependant it seems you would save more in taxes year after ...
by PortlandHead
Tue Apr 30, 2013 9:42 pm
 
Forum: Investing - Help with Personal Investments
Topic: Portfolio Q&A -- Probably Some Low-Hanging Fruit!
Replies: 66
Views: 3001

Re: Portfolio Q&A -- Probably Some Low-Hanging Fruit!

There are such thing as extremely low-probability events. Therefore? What, exactly? Maybe my creditor will misplace my debt. Should I plan for that?
by PortlandHead
Tue Apr 30, 2013 9:31 pm
 
Forum: Investing - Help with Personal Investments
Topic: Portfolio Q&A -- Probably Some Low-Hanging Fruit!
Replies: 66
Views: 3001

Re: Portfolio Q&A -- Probably Some Low-Hanging Fruit!

The 150k was to refinance student debt at a much higher rate. The allocation of the taxable is an open question. I only created the account recently, so the current allocation hasn't had time to matter yet. I will alter it once I figure out whether it should even continue to exist. :D As for the res...
by PortlandHead
Tue Apr 30, 2013 7:21 pm
 
Forum: Investing - Help with Personal Investments
Topic: Portfolio Q&A -- Probably Some Low-Hanging Fruit!
Replies: 66
Views: 3001

Re: Portfolio Q&A -- Probably Some Low-Hanging Fruit!

4% surplus, meaning a 7% annualized nominal return over ten years, which is the median nominal return in Vanguard's prediction, and is below historical norms.
by PortlandHead
Tue Apr 30, 2013 5:38 pm
 
Forum: Investing - Help with Personal Investments
Topic: Portfolio Q&A -- Probably Some Low-Hanging Fruit!
Replies: 66
Views: 3001

Re: Portfolio Q&A -- Probably Some Low-Hanging Fruit!

Characterizing all margin investing as "extremely risky" without numbers isn't rational. To take an extreme example, if I can borrow money at .01%, it would be foolish not to do so and buy a bunch of T-bills. Whether any particular margin investing is "extremely risky" or not dep...
by PortlandHead
Tue Apr 30, 2013 5:26 pm
 
Forum: Investing - Help with Personal Investments
Topic: Portfolio Q&A -- Probably Some Low-Hanging Fruit!
Replies: 66
Views: 3001

Re: Portfolio Q&A -- Probably Some Low-Hanging Fruit!

If you win, you win a little bit. If you lose, you lose big. This is the assessment with which I disagree. I believe the evidence shows that it is precisely the opposite. But we can leave it there. I very much appreciate your help, and will be happy to continue to receive it on the retirement front...
by PortlandHead
Tue Apr 30, 2013 4:52 pm
 
Forum: Investing - Help with Personal Investments
Topic: Portfolio Q&A -- Probably Some Low-Hanging Fruit!
Replies: 66
Views: 3001

Re: Portfolio Q&A -- Probably Some Low-Hanging Fruit!

You are taking an awful risk (default on the note) for that hypothetical $1. So, no thats not being rational :( . That's not correct. This isn't like a coin flip where it's heads I win a dollar and tails I default on the note. In order for me to default on the note, my 170k of saved cash (50k plus ...
by PortlandHead
Tue Apr 30, 2013 4:41 pm
 
Forum: Investing - Help with Personal Investments
Topic: Portfolio Q&A -- Probably Some Low-Hanging Fruit!
Replies: 66
Views: 3001

Re: Portfolio Q&A -- Probably Some Low-Hanging Fruit!

Well, not bonds then. Let's talk about a 70/30 portfolio. You don't think it is much more likely than not that a portfolio allocated 70/30 will return greater than 3% nominal gains after taxes in any given ten year period? In some 10 year periods? Yes. In any given 10 year period? No. In fact, not ...
by PortlandHead
Tue Apr 30, 2013 4:20 pm
 
Forum: Investing - Help with Personal Investments
Topic: Portfolio Q&A -- Probably Some Low-Hanging Fruit!
Replies: 66
Views: 3001

Re: Portfolio Q&A -- Probably Some Low-Hanging Fruit!

Yes and yes, to your questions. It seems to me that the financial question really is just a question of (1) will I more likely than not make more than 3% nominal after taxes and (2) can I afford it if I don't. If the answer to (1) and (2) are both "yes," then I fail to see why it isn't a n...
by PortlandHead
Tue Apr 30, 2013 3:52 pm
 
Forum: Investing - Help with Personal Investments
Topic: Portfolio Q&A -- Probably Some Low-Hanging Fruit!
Replies: 66
Views: 3001

Re: Portfolio Q&A -- Probably Some Low-Hanging Fruit!

I don't disagree with this in theory. However, your plan is not 5:1 odds. I don't think it's even 1:1 if you use bonds as the investment. Well, not bonds then. Let's talk about a 70/30 portfolio. You don't think it is much more likely than not that a portfolio allocated 70/30 will return greater th...
by PortlandHead
Tue Apr 30, 2013 3:31 pm
 
Forum: Investing - Help with Personal Investments
Topic: Portfolio Q&A -- Probably Some Low-Hanging Fruit!
Replies: 66
Views: 3001

Re: Portfolio Q&A -- Probably Some Low-Hanging Fruit!

Why do it at all? Because rational decision-making compels that if someone offers you 5:1 odds on a coin flip, you take it so long as you can deal with the consequences of losing. Here, losing most likely means I pay a little more on the loan than I would have if I started paying down the principal...
by PortlandHead
Tue Apr 30, 2013 2:40 pm
 
Forum: Investing - Help with Personal Investments
Topic: Portfolio Q&A -- Probably Some Low-Hanging Fruit!
Replies: 66
Views: 3001

Re: Portfolio Q&A -- Probably Some Low-Hanging Fruit!

Ok. Next step is that I will look at whether her old 401k will accept transfer of her old IRA. Re: payments on 3% debt vs. investing the savings for balloon payment : I certainly understand there's risk involved, but it isn't so obvious to me that the risk is undue. How many ten-year periods are the...
by PortlandHead
Tue Apr 30, 2013 1:57 pm
 
Forum: Investing - Help with Personal Investments
Topic: Portfolio Q&A -- Probably Some Low-Hanging Fruit!
Replies: 66
Views: 3001

Re: Portfolio Q&A -- Probably Some Low-Hanging Fruit!

I understand the taxation issue for the bonds. What I'm trying to wrap my head around is the effect of inflation. I had thought that the risk of inflation was essentially that they bond is gonna pay out what it pays out, and unlike an equity, it's not gonna increase with inflation. So it's not that ...
by PortlandHead
Tue Apr 30, 2013 10:31 am
 
Forum: Investing - Help with Personal Investments
Topic: Portfolio Q&A -- Probably Some Low-Hanging Fruit!
Replies: 66
Views: 3001

Re: Portfolio Q&A -- Probably Some Low-Hanging Fruit!

The other 20k is just cash sitting in savings. I was waiting to decide where to put it until I had a better sense that I had a good overall strategy. Re:bonds. Investment grade corporate bonds are averaging about 3% right now. Am I misunderstanding that somehow? Re:Roth. I think she can still backdo...
by PortlandHead
Tue Apr 30, 2013 9:59 am
 
Forum: Investing - Help with Personal Investments
Topic: Portfolio Q&A -- Probably Some Low-Hanging Fruit!
Replies: 66
Views: 3001

Re: Portfolio Q&A -- Probably Some Low-Hanging Fruit!

The 3% loan: I'm free to pay it earlier. I just thought that I could easily beat 3% investing the money very conservatively. This was true in the past. It might have even been true when you took the loan, but it is not true now. There are no very conservative investments paying 3% that I know of. S...
by PortlandHead
Tue Apr 30, 2013 9:04 am
 
Forum: Investing - Help with Personal Investments
Topic: Portfolio Q&A -- Probably Some Low-Hanging Fruit!
Replies: 66
Views: 3001

Re: Portfolio Q&A -- Probably Some Low-Hanging Fruit!

The 3% loan: I'm free to pay it earlier. I just thought that I could easily beat 3% investing the money very conservatively. I had intended to save (i.e., contribute to the taxable fund) $1,000/mo. for the loan, and not to deplete the 50k principal in the taxable fund until then in case I need more ...
by PortlandHead
Tue Apr 30, 2013 8:15 am
 
Forum: Investing - Help with Personal Investments
Topic: Portfolio Q&A -- Probably Some Low-Hanging Fruit!
Replies: 66
Views: 3001

Re: Portfolio Q&A -- Probably Some Low-Hanging Fruit!

Thanks again to all for the advice. I locked in 3.375% with no closing costs for the refi. Seems like a good deal to me. englishgirl : You're right to be confused, because I'm confused! Fortunately, the allocations are all very recent as is the creation of the taxable account, so there'll be no harm...
by PortlandHead
Mon Apr 29, 2013 7:35 pm
 
Forum: Investing - Help with Personal Investments
Topic: Portfolio Q&A -- Probably Some Low-Hanging Fruit!
Replies: 66
Views: 3001

Re: Portfolio Q&A -- Probably Some Low-Hanging Fruit!

Mortgage ($270,000 @ 4.25% effectively 3% after tax deduction) This is somewhat high. I'd look at refinancing if possible. Doing this today. 20% cash (the allocation is a bit off now and I will correct it with these funds once I decide how much to keep in short-term money market or similar) Is this...
by PortlandHead
Mon Apr 29, 2013 11:58 am
 
Forum: Investing - Help with Personal Investments
Topic: Portfolio Q&A -- Probably Some Low-Hanging Fruit!
Replies: 66
Views: 3001

Re: Portfolio Q&A -- Probably Some Low-Hanging Fruit!

Necessary information is missing. . . . Also need to know the approximate size of the portfolio. Ok, I think I've included all of it, unless you need to know the equities options as well. The options in my wife's new 404c are all pretty terrible. The old 401k Vanguard is exactly what you'd expect, ...
by PortlandHead
Mon Apr 29, 2013 11:51 am
 
Forum: Investing - Help with Personal Investments
Topic: Portfolio Q&A -- Probably Some Low-Hanging Fruit!
Replies: 66
Views: 3001

Re: Portfolio Q&A -- Probably Some Low-Hanging Fruit!

Thanks for the replies.

On refinancing, is it just a matter of whether I can get a low-enough rate to make up for the transaction costs given my expected longevity in the house? Or are there other considerations?
by PortlandHead
Mon Apr 29, 2013 8:54 am
 
Forum: Investing - Help with Personal Investments
Topic: Portfolio Q&A -- Probably Some Low-Hanging Fruit!
Replies: 66
Views: 3001

Portfolio Q&A -- Probably Some Low-Hanging Fruit!

Basics Emergency funds: three months of expenses Debt: Private Note ($150,000 @ 3% with payment due in full 2023); Mortgage ($270,000 now refinancing to 3.375% ). Tax Filing Status: Married Filing Separately Tax Rate: 28%/25% Federal, 3% State State of Residence: PA Age: 30 Desired Asset allocation...
by PortlandHead
Sun Apr 28, 2013 5:23 pm
 
Forum: Investing - Help with Personal Investments
Topic: Portfolio Q&A -- Probably Some Low-Hanging Fruit!
Replies: 66
Views: 3001

Return to advanced search