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Re: POLL: Attitude Towards Risk

b, not because it has a higher expected return, but because $240 is not a meaningfully large amount that I really care, but with $1000 I could do something like a weekend getaway. d: because today I feel like the gamble would spice things up. Another day I might take c. This might reflect that both ...
by Rodc
Wed Nov 26, 2014 5:51 pm
 
Forum: Investing - Theory, News & General
Topic: POLL: Attitude Towards Risk
Replies: 48
Views: 1493

Re: Best way to pay my parents back

I don't thing paying back money borrowed falls under the gift limits as it is not a gift.

Likewise, paying back a loan is not income so they won't owe taxes.

I'm no lawyer, so I look forward to what folks have to say, but I suspect your concerns are not warranted.
by Rodc
Wed Nov 26, 2014 4:08 pm
 
Forum: Personal Finance (Not Investing)
Topic: Best way to pay my parents back
Replies: 7
Views: 1009

Re: Paying my parents a salary not to touch their nest egg

TomatoTomahto wrote:
InertiaMan wrote:What Boglehead wouldn't seriously consider a 4% real return for life?


I love and trust my children. However, I would not buy a $1M annuity from them, even if they didn't have student loans, minimal assets, etc. Stuff happens.


That is why you keep the $1m and transfer it on death. :)
by Rodc
Wed Nov 26, 2014 4:02 pm
 
Forum: Personal Finance (Not Investing)
Topic: Paying my parents a salary not to touch their nest egg
Replies: 50
Views: 4146

Re: Paying my parents a salary not to touch their nest egg

Too much risk in my opinion. You might give them a million dollars over the next 25 years and have it all lost to a lawsuit or long term medical care. Keep your savings in your name. Gill That is why you have them put their nest-egg in a trust. This can be set up so the principle and income can be ...
by Rodc
Wed Nov 26, 2014 12:28 pm
 
Forum: Personal Finance (Not Investing)
Topic: Paying my parents a salary not to touch their nest egg
Replies: 50
Views: 4146

Re: Starter Trust for adult child?

I do not believe such limits apply to simply hold a trust's assets at Vanguard. Just as financial management services are available for an extra fee at Vanguard, it is not necessary to utilize those services to have your assets there and manage them yourself. That is correct. I am managing such a t...
by Rodc
Wed Nov 26, 2014 12:25 pm
 
Forum: Personal Finance (Not Investing)
Topic: Starter Trust for adult child?
Replies: 8
Views: 1027

Re: Buying a Computer. Need recommendations.

I just wanted to pop in to say thanks to Stoptothink and others who recommended a Chromebook to OP. My wife recently slayed her laptop which I had given her as a Christmas present a few years ago and has since been stumbling around on an old netbook I had. She doesn't particularly care for the netb...
by Rodc
Wed Nov 26, 2014 12:21 pm
 
Forum: Personal Consumer Issues
Topic: Buying a Computer. Need recommendations.
Replies: 36
Views: 2235

Re: Buying a Computer. Need recommendations.

Lot of people have asked the question - why is your computer slow. Without knowing if your computer has malware/viruses and other bloatware, that might be the first thing to look at. Many times simple restore operation will help to improve the performance - but please make sure you have adequate ba...
by Rodc
Wed Nov 26, 2014 9:10 am
 
Forum: Personal Consumer Issues
Topic: Buying a Computer. Need recommendations.
Replies: 36
Views: 2235

Re: Buying a Computer. Need recommendations.

It may need nothing more than a good cleaning/tune up. Google "my computer is slow" "my computer is slowing down, how to speed it up" etc. I wont throw away the old set up. It will become the backup computer on another floor. I will let my son handle the cleanup when he comes ho...
by Rodc
Tue Nov 25, 2014 8:48 pm
 
Forum: Personal Consumer Issues
Topic: Buying a Computer. Need recommendations.
Replies: 36
Views: 2235

Re: changing jobs after a decade - risky or exhilirating

If you are comfortable you are not growing (much), not stretching. That is ok if you are within 5 years of retirement, but perhaps more risky at your age than looking for new horizons. What happens if a new boss notices you are on cruise control at age 50 and cuts you loose.You have not developed a ...
by Rodc
Tue Nov 25, 2014 5:39 pm
 
Forum: Personal Consumer Issues
Topic: changing jobs after a decade - risky or exhilirating
Replies: 5
Views: 681

Re: Buying a Computer. Need recommendations.

It may need nothing more than a good cleaning/tune up.

Google "my computer is slow" "my computer is slowing down, how to speed it up" etc.
by Rodc
Tue Nov 25, 2014 5:33 pm
 
Forum: Personal Consumer Issues
Topic: Buying a Computer. Need recommendations.
Replies: 36
Views: 2235

Re: How did you handle the 2008 bear market ?

Clearly, we never know if we are in the bear market, other than the classic definition of a 20% drop in the S&P 500. As an example, a 50% drop in the S&P 500 would result in -30% drop (if my math is correct) in a 60/40 split portfolio, assuming bonds held value. This would require a 43% ret...
by Rodc
Tue Nov 25, 2014 3:08 pm
 
Forum: Investing - Theory, News & General
Topic: How did you handle the 2008 bear market ?
Replies: 67
Views: 3083

Re: How did you handle the 2008 bear market ?

Just rebalanced according to plan.

Can't say it was fun.
by Rodc
Tue Nov 25, 2014 3:05 pm
 
Forum: Investing - Theory, News & General
Topic: How did you handle the 2008 bear market ?
Replies: 67
Views: 3083

Re: Back-up Drive - Local or Cloud? Which?

Both.

Downloading a lot from the cloud can be very slow (did that once using Carbonite, now using Crashplan but have not tried a massive download). So I prefer the local solution. But given a lightening strike, fire, or whatever, I'll be glad I have a cloud copy.
by Rodc
Tue Nov 25, 2014 11:57 am
 
Forum: Personal Consumer Issues
Topic: Back-up Drive - Local or Cloud? Which?
Replies: 27
Views: 1581

Re: Avoiding lifestyle creep

Given the size of your "emergency fund" I would not bother with keeping separate accounts for cars or whatever. If you want to put it "towards" a car just put it in the liquid fund and buy your new car when the need arises. I would probably put it in the 529. But I don't know all...
by Rodc
Tue Nov 25, 2014 11:50 am
 
Forum: Personal Finance (Not Investing)
Topic: Avoiding lifestyle creep
Replies: 21
Views: 2777

Re: The mathematics of recouping loss

The graph doesn't care about compounding. It takes 62 consecutive 1% declines to get from 100 to 50 (50% loss) and 62 consecutive 1% increases to get from 50 to 100 (100% increase). I get 70 1% increases to get to 2 and 69 1% decreases to get to 0.5. This points to why the example in the OP does no...
by Rodc
Fri Nov 21, 2014 7:06 pm
 
Forum: Investing - Theory, News & General
Topic: The mathematics of recouping loss
Replies: 11
Views: 1247

Re: Do freecyclers resell?

On trash day, pickup trucks cruise the neighborhood in the early morning and fill their beds before the garbage trucks show up. I'm sure many free cycle things end up in those pickup trucks. We don't wait for trash day. I put stuff out at the end of the driveway and stick a "free" sign on...
by Rodc
Thu Nov 20, 2014 7:03 pm
 
Forum: Personal Consumer Issues
Topic: Do freecyclers resell?
Replies: 11
Views: 1669

Re: How premium cable can cost $59K

One problem with all these sorts of examples is that is true only in fact you use the money to invest (and get the somewhat optimistic returns). You might in fact do this, but I think in general most people simply use the money to buy something else. And as my wife points out from time to time, deny...
by Rodc
Mon Nov 17, 2014 1:34 pm
 
Forum: Personal Finance (Not Investing)
Topic: How premium cable can cost $59K
Replies: 45
Views: 5269

Re: Your car(s) are equal to how many months income

OK, my calculation: 0.00742. Hah! I have just proven that I am the most frugal of the 3 of us. I shall henceforth be known as "letsgobobbybogle" and will wear my title with pride. That is, until markettimer snatches it away with his 'undefined' 0/0 calculation, without a car, and without ...
by Rodc
Fri Nov 14, 2014 3:32 pm
 
Forum: Personal Consumer Issues
Topic: Your car(s) are equal to how many months income
Replies: 93
Views: 6049

Re: Winter Coat

A year ago, my son bought a Columbia coat/jacket that had an inner reflective layer. I admonished him that it was much too light for a NE winter. Well, there was something magical in that coat, because he was toasty while I felt cold. They say every generation is supposed to be smarter than the pre...
by Rodc
Fri Nov 14, 2014 3:30 pm
 
Forum: Personal Consumer Issues
Topic: Winter Coat
Replies: 51
Views: 4460

Re: Chip and Pin: busted by hackers before it's even here

But I know that they are talking about the contactless variant, because I have a PhD in Electrical Engineering, and these topics fall within my area of expertise. Rather than wear a tin-foil hat can I use a tin-foil wallet? (FWIW: We have a variant of tin-foil wallets at work for our ID badges. One...
by Rodc
Fri Nov 14, 2014 3:22 pm
 
Forum: Personal Consumer Issues
Topic: Chip and Pin: busted by hackers before it's even here
Replies: 17
Views: 1494

Re: Your car(s) are equal to how many months income

Have a new car and a 5 year old car. Between one and two months gross income. I selected "2". Ask in 5 years and you'll likely get a lower answer. for a given individual or couple this answer continually changes as a function of time. To capture 'Boglehead frugality' it would be something...
by Rodc
Fri Nov 14, 2014 2:58 pm
 
Forum: Personal Consumer Issues
Topic: Your car(s) are equal to how many months income
Replies: 93
Views: 6049

Re: Father of eight hasn’t saved a penny for college

I've paid more in Social Security taxes, counting compound interest than I will ever get back in benefits. Now who's subsidizing whom? There's nothing miserly about saying overpopulation is wrong, any more than there's something miserly about saying people shouldn't discard hazardous waste in river...
by Rodc
Fri Nov 14, 2014 2:51 pm
 
Forum: Personal Consumer Issues
Topic: Father of eight hasn’t saved a penny for college
Replies: 47
Views: 2723

Re: Your car(s) are equal to how many months income

Have a new car and a 5 year old car. Between one and two months gross income. I selected "2".

Ask in 5 years and you'll likely get a lower answer.
by Rodc
Thu Nov 13, 2014 1:19 pm
 
Forum: Personal Consumer Issues
Topic: Your car(s) are equal to how many months income
Replies: 93
Views: 6049

Re: How to think about expected returns--continuing discussi

^^^ “The best is the enemy of the good.” ― Voltaire (French philosopher, 1694-1778) The above is not best, it is merely an attempt to not do something really badly. One might as well not do badly when good is easy enough. Surely if you can run one MC you can run a handful to get a sense of the sens...
by Rodc
Sat Oct 25, 2014 1:35 pm
 
Forum: Investing - Theory, News & General
Topic: How to think about expected returns--continuing discussion
Replies: 105
Views: 8585

Re: How to think about expected returns--continuing discussi

Facts, people must agree on. But everyone is entitled to their opinion and opinions can vary. It's unrealistic to expect scientific precision from financial data — it's just not there and it's never going to be there. But that does not mean that analysis of financial data, as imprecise as it is, is...
by Rodc
Sat Oct 25, 2014 12:24 pm
 
Forum: Investing - Theory, News & General
Topic: How to think about expected returns--continuing discussion
Replies: 105
Views: 8585

Re: Renting vs owning

If we're arguing over whether houses or apartments are better let's at least be explicit about the fact Compared to other such threads I'm not seeing "argue". Also all I see is people giving the specific of their own experience for contex, which in some cases is with apartments, townhouse...
by Rodc
Fri Oct 24, 2014 3:11 pm
 
Forum: Personal Finance (Not Investing)
Topic: Renting vs owning
Replies: 16
Views: 1831

Re: More funds = more "efficient" rebalancing?

What is this "automatic adjustment" that occurs in a market cap fund? I am not aware of any adjustment (at least in a total market fund, some have size cutoffs for example). Indeed I thought one of the great attributes of cap weight funds is the fact they have no such adjustment which is ...
by Rodc
Fri Oct 24, 2014 11:43 am
 
Forum: Investing - Theory, News & General
Topic: More funds = more "efficient" rebalancing?
Replies: 28
Views: 1876

Re: Do you regret buying your home?

I have been in my house for over 20 years. I like it fine. Actually I like it a lot. Almost nothing in life is perfect. So in almost all areas of life one might wish for some changes. If you want perfect you are going to be disappointed. We did a major renovation and expansion of the house right bef...
by Rodc
Fri Oct 24, 2014 9:50 am
 
Forum: Personal Consumer Issues
Topic: Do you regret buying your home?
Replies: 82
Views: 6972

Re: Renting vs owning

Why not buy a townhouse? I mean, if it's financially beneficial Without knowing the current price and rent of the townhouse in question how on earth can you know that? It could be financially detrimental just as easily as it can be beneficial. Well, tj is responding to someone who said, "In my...
by Rodc
Fri Oct 24, 2014 7:36 am
 
Forum: Personal Finance (Not Investing)
Topic: Renting vs owning
Replies: 16
Views: 1831

Re: Can you outperform [an index by rebalancing]?

Thanks all, some interesting posts and viewpoints above Looking at an example of say the below which is an ASX200 fund (Vanguards Australian Index fund is an ASX300 fund) and compared to Vanguards Bond Index (VGB - the red line) the ASX200 fund is nearly back to where it started over 12 months ago,...
by Rodc
Fri Oct 24, 2014 7:34 am
 
Forum: Investing - Theory, News & General
Topic: Can you outperform [an index by rebalancing]?
Replies: 12
Views: 1247

Re: More funds = more "efficient" rebalancing?

Tfb, Chan_va or others: Can you expend a bit further what it means that total funds continuously rebalance? If, for instance, "total international" simply reflects the whole international market, and if "emerging" performs better than the rest of the fund, wouldn't its share of ...
by Rodc
Fri Oct 24, 2014 7:30 am
 
Forum: Investing - Theory, News & General
Topic: More funds = more "efficient" rebalancing?
Replies: 28
Views: 1876

Re: More funds = more "efficient" rebalancing?

The logical extreme of this would be something like an "equal weight" index fund that attempts to own every stock and maintain them at equal weights by constantly rebalancing every stock. I imagine a trading strategy that follows something like that works well when there is a lot of dispe...
by Rodc
Fri Oct 24, 2014 7:28 am
 
Forum: Investing - Theory, News & General
Topic: More funds = more "efficient" rebalancing?
Replies: 28
Views: 1876

Re: How often do you change your car's oil?

cheese_breath wrote:Every 4,000-5,000 miles. This is less than the manufacturer's recommendations, but after a couple bad experiences following their recommendations I figure being a little on the safe side is worth a few extra bucks per year.


About the same for us.

More often than the cars get washed. :happy
by Rodc
Fri Oct 24, 2014 6:18 am
 
Forum: Personal Consumer Issues
Topic: How often do you change your car's oil?
Replies: 168
Views: 11293

Re: More funds = more "efficient" rebalancing?

Tfb, Chan_va or others: Can you expend a bit further what it means that total funds continuously rebalance? If, for instance, "total international" simply reflects the whole international market, and if "emerging" performs better than the rest of the fund, wouldn't its share of ...
by Rodc
Fri Oct 24, 2014 6:09 am
 
Forum: Investing - Theory, News & General
Topic: More funds = more "efficient" rebalancing?
Replies: 28
Views: 1876

Re: Can you outperform?

Might you? Yes. Will you? Maybe not. Basically you are asking about a rebalance bonus. You might do a search on that term on this site. It all hinges on whether returns are totally random or if they mean revert. Historically sometimes they do and some times they don't. At any rate, the effect if you...
by Rodc
Thu Oct 23, 2014 6:24 pm
 
Forum: Investing - Theory, News & General
Topic: Can you outperform [an index by rebalancing]?
Replies: 12
Views: 1247

Re: Renting vs owning

There are many pros and cons, which is a better financial deal in the long run is highly location dependent, or even highly specific property dependent. And as noted above it is also a lifestyle choice, some would even say mostly a lifestyle choice. There is nothing generically wrong or right with r...
by Rodc
Thu Oct 23, 2014 4:02 pm
 
Forum: Personal Finance (Not Investing)
Topic: Renting vs owning
Replies: 16
Views: 1831

Re: Three Possible Outcomes for Future Investment Returns

So, don't rush out of your bonds just yet. Yes, the takeaway from low expected asset returns is NOT to give up on safe, lower-yielding bonds or to reach for more yield and return in riskier asset classes. Rather, investors should just expect that investment returns are likely to be lower than histo...
by Rodc
Thu Oct 23, 2014 2:48 pm
 
Forum: Investing - Theory, News & General
Topic: Three Possible Outcomes for Future Investment Returns
Replies: 32
Views: 2358

Re: Long term return forecast

Thanks for the link. Interesting to see that Research Affiliates' forecast of real returns for U.S. Large Cap stocks is less than 1% real over the next 10 years (1.8% yield + 1.3% growth - 2.4% valuation = 0.7% total return). This is where their estimate fits into the current range of other forecas...
by Rodc
Thu Oct 23, 2014 12:49 pm
 
Forum: Investing - Theory, News & General
Topic: Long term return forecast [Research Affil. Expected returns]
Replies: 33
Views: 2499

Re: Just wondering how you personally calculate net worth

I discount my tax deferred holdings by 25%. An arbitrary number I pulled out of a hat. I don't discount taxable holdings by the cap gains rate on the gains, although for consistency I should. An interesting consideration - to discount a tax deferred holding. But if I did that, let's say I have 50K ...
by Rodc
Thu Oct 23, 2014 10:10 am
 
Forum: Personal Finance (Not Investing)
Topic: Just wondering how you personally calculate net worth
Replies: 56
Views: 3887

Re: More funds = more "efficient" rebalancing?

Every rebalancing study I have ever read says the benefits are at best tiny.

More "total" the fund the cheaper to run it including trading costs so in that sense fewer is likely better on that side of things.

Don't let this tail wag your dog.
by Rodc
Thu Oct 23, 2014 9:10 am
 
Forum: Investing - Theory, News & General
Topic: More funds = more "efficient" rebalancing?
Replies: 28
Views: 1876

Re: Three Possible Outcomes for Future Investment Returns

I am somewhat pessimistic over the intermediate term, notionally say 10 years. Much longer than that and almost anything could happen. Another stock crash could reset stocks even sooner, 10 year yields on ten year bonds not so much. Your results are really, as you note, saying things now are all exp...
by Rodc
Wed Oct 22, 2014 8:49 pm
 
Forum: Investing - Theory, News & General
Topic: Three Possible Outcomes for Future Investment Returns
Replies: 32
Views: 2358

Re: Just wondering how you personally calculate net worth

Why do you need this number to be accurate? If a large number makes you feel good, then multiply the taxable account by your tax rate. You can make it even bigger by adding pension and social security that you have earned. Some people would even add their unused vacation days. :) And maybe their wa...
by Rodc
Wed Oct 22, 2014 8:16 pm
 
Forum: Personal Finance (Not Investing)
Topic: Just wondering how you personally calculate net worth
Replies: 56
Views: 3887

Re: More in equities as you age ?

Second, it totally ignores the stomach acid test or willingness to take risk. Even if the math were to show Kitces is correct, which we don't agree with, the analysis totally ignores human behavior. I agree. This is a huge issue. A computer algorithm has nerves of steel. Or silicon. People not so m...
by Rodc
Wed Oct 22, 2014 8:07 pm
 
Forum: Investing - Theory, News & General
Topic: More in equities as you age ?
Replies: 11
Views: 1083

Re: More in equities as you age ?

My analysis as posted in another thread: (3) A rising equity glide path in retirement helps portfolio longevity. Is this one just a special case of #2? False. He makes that claim but the paper itself actually says there is no measurable difference between a constant and a raising glide path. Others ...
by Rodc
Wed Oct 22, 2014 8:03 pm
 
Forum: Investing - Theory, News & General
Topic: More in equities as you age ?
Replies: 11
Views: 1083

Re: lost 8606 from years ago - am I in trouble?

I am afraid you will have to move to Canada.
by Rodc
Wed Oct 22, 2014 6:32 pm
 
Forum: Personal Finance (Not Investing)
Topic: lost 8606 from years ago - am I in trouble?
Replies: 16
Views: 1778

Re: Just wondering how you personally calculate net worth

I calculate mine aperiodically. After tax would be better, even though the future tax rate I or heirs will pay is unknown, but I don't bother. I don't count pension, social security, etc that I do not own and can get as a lump sum. I suppose if I had a pension I knew I could take as a lump sum at an...
by Rodc
Wed Oct 22, 2014 6:31 pm
 
Forum: Personal Finance (Not Investing)
Topic: Just wondering how you personally calculate net worth
Replies: 56
Views: 3887

Re: Kids & Sports

I have a son who had some sensory and motor control issues. Not the same as your son but in the process of understanding my son I did a lot of reading including about kids like your son may be. For a kid like my son or perhaps yours specialized activities (occupational or physical therapy) are likel...
by Rodc
Wed Oct 22, 2014 6:19 pm
 
Forum: Personal Consumer Issues
Topic: Kids & Sports
Replies: 26
Views: 2347

Re: How to think about expected returns--continuing discussi

Rod, I was only pointing out that people with very high levels of skills in the field come to a different conclusion than you do. Doesn't make you wrong and them right, but that there is another viewpoint than yours with people who have the skills to make an informed decision. Nothing more was impl...
by Rodc
Wed Oct 22, 2014 1:46 pm
 
Forum: Investing - Theory, News & General
Topic: How to think about expected returns--continuing discussion
Replies: 105
Views: 8585

Re: How to think about expected returns--continuing discussi

Larry, Yes, typo 2000. The argument of simply saying well we have world class mathematicians is about as weak an argument as one can make. I have a PhD in math. I work with world class mathematicians, computer scientists, etc and have for decades. The Monte Carlo simulation tools we design, implemen...
by Rodc
Wed Oct 22, 2014 9:38 am
 
Forum: Investing - Theory, News & General
Topic: How to think about expected returns--continuing discussion
Replies: 105
Views: 8585

Re: POLL: How fulfilling is your retirement?

E.g. do you really expect a spouse whom you insisted sign a prenup will spoon feed you or change Depends?


Now that is an interesting question.

Agree health can turn on a dime. I have seen it happen and plans and dreams all change.

Good luck to you.
by Rodc
Tue Oct 21, 2014 5:53 pm
 
Forum: Personal Finance (Not Investing)
Topic: POLL: How fulfilling is your retirement?
Replies: 34
Views: 3055
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