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Re: In a Serious Situation Need Financial Advice

I almost hate to say it, but consider going back to your previous business while keeping the details within the rules of the law.
It seems like you were doing OK for a while, yes?
by The Wizard
Sun Sep 21, 2014 4:23 pm
 
Forum: Personal Finance (Not Investing)
Topic: In a Serious Situation Need Financial Advice
Replies: 26
Views: 2993

Re: New Investor begging for input

Thanks for all the input guys, keep it coming. I feel like my first day in the operating room, whatever I do will and sound like stupid. So, it comes... Should I utilize the fidelity 401K for max return(thus go for 100% Sp500) or go for 100% safety in 401K and go with bonds? Before getting into tha...
by The Wizard
Sun Sep 21, 2014 1:20 pm
 
Forum: Investing - Help with Personal Investments
Topic: New Investor begging for input
Replies: 34
Views: 1262

Re: New Investor begging for input

I'm guessing that before long, the OP will have quite a bit more in his TAXABLE account compared to the 401(k). With that in mind it probably makes sense to hold 100% bond funds in the 401(k) and keep low-cost stock index funds in taxable. The last fund in the OP's list appears to be Fidelity's Spa...
by The Wizard
Sun Sep 21, 2014 12:02 pm
 
Forum: Investing - Help with Personal Investments
Topic: New Investor begging for input
Replies: 34
Views: 1262

Re: In a Serious Situation Need Financial Advice

Get a less expensive V6 Mustang, yes, like the one I have. :)
I'm a bit puzzled how the OP came into her modest savings lump sum which was even larger before the immigration battle.
You must have been living beneath your means and saving every month then, right?
Or was it an inheritance?
by The Wizard
Sun Sep 21, 2014 11:52 am
 
Forum: Personal Finance (Not Investing)
Topic: In a Serious Situation Need Financial Advice
Replies: 26
Views: 2993

Re: New Investor begging for input

I'm guessing that before long, the OP will have quite a bit more in his TAXABLE account compared to the 401(k). With that in mind it probably makes sense to hold 100% bond funds in the 401(k) and keep low-cost stock index funds in taxable. The last fund in the OP's list appears to be Fidelity's Spar...
by The Wizard
Sun Sep 21, 2014 11:33 am
 
Forum: Investing - Help with Personal Investments
Topic: New Investor begging for input
Replies: 34
Views: 1262

Re: Need help protecting assets (marriage)

I would not bother with just 100K asset. If you expect a very large inheritance in the future, that might be different story. In the grand scheme of things (say 30 years of marriage), 100K is simply too little asset to go thru this trouble in my opinion. This leaves bad taste in her and her family....
by The Wizard
Sun Sep 21, 2014 11:27 am
 
Forum: Personal Finance (Not Investing)
Topic: Need help protecting assets (marriage)
Replies: 45
Views: 3068

Re: Are SPIA's fairly priced? - A quick and dirty analysis

As I said upthread, to make an informed decision about WHEN to purchase an annuity, one needs to know the cost of the product vs the value of mortality credits. As long as the overhead cost of an annuity is greater than the benefit received from mortality credits in a given year, it's better to wai...
by The Wizard
Sun Sep 21, 2014 9:29 am
 
Forum: Investing - Theory, News & General
Topic: Are SPIA's fairly priced? - A quick and dirty analysis
Replies: 75
Views: 3393

Re: Another take on "rising equity glidepath" in retirement

I also tend to agree with Larry's take on this with an exception depending on how well the retiree's income needs are already being met, liability matching, I suppose. If that rising stock allocation is for the indefinite long future, then the retiree might be less likely to panic in a significant d...
by The Wizard
Sun Sep 21, 2014 9:08 am
 
Forum: Investing - Theory, News & General
Topic: Another take on "rising equity glidepath" in retirement
Replies: 14
Views: 1361

Re: Tax Efficiency of Taxable Investments

While consolidation to fewer funds makes sense, not everybody has lots of tax-sheltered space, depending on what your employer provides and also depending on the level of total assets.
So we should inquiire about that...
by The Wizard
Sun Sep 21, 2014 8:47 am
 
Forum: Investing - Help with Personal Investments
Topic: Tax Efficiency of Taxable Investments
Replies: 15
Views: 2029

Re: Risks to putting most investments at Vanguard

Although my assets are split between TIAA-CREF and Vanguard for historical reasons, I'm not at all concerned about this single custodian black swan scenario...
by The Wizard
Sun Sep 21, 2014 8:40 am
 
Forum: Investing - Help with Personal Investments
Topic: Risks to putting most investments at Vanguard
Replies: 18
Views: 1024

Re: We have a grocery problem... [Household budget]

123 wrote:Some people have a hard time realizing that alcohol and tobacco products aren't "food". If those happen to slide into grocery shopping expenses and "meals out" the total amounts can skyrocket.

I don't think the OP said either of these categories were in there...
by The Wizard
Sat Sep 20, 2014 9:28 pm
 
Forum: Personal Consumer Issues
Topic: We have a grocery problem... [Household budget]
Replies: 117
Views: 7128

Re: Do I Really Need a Million Bucks?

Let's look what $1M in tax-sheltered IRA/401(k)/403(b) equates to in retirement. The $1M could be for a single person or a couple; doesn't matter for this exercise. Assume no pension, hence the need to save more in Defined Contributions. Our retiree can safely w/d around $40,000 a year from that amo...
by The Wizard
Sat Sep 20, 2014 3:31 pm
 
Forum: Personal Consumer Issues
Topic: Do I Really Need a Million Bucks?
Replies: 50
Views: 3450

Re: Do I Really Need a Million Bucks?

For someone retiring in 2014 without a pension, a million bucks is a good start to being able to live decently.
For a similar person retiring 10 or 20 years from now, $1M will be a progress point to hit in their 40's or 50's ...
by The Wizard
Sat Sep 20, 2014 2:03 pm
 
Forum: Personal Consumer Issues
Topic: Do I Really Need a Million Bucks?
Replies: 50
Views: 3450

Re: We have a grocery problem...

Step one is to separate out all the non-food items in that $230, along with alcoholic beverages as well. That could get it down to $180 a week for two, which is still a bit high. I buy a fair amount of SEAFOOD at my grocery store: lobsters @ $5/lb ; steamer clams @ $4/lb; swordfish @ $9/lb most rec...
by The Wizard
Sat Sep 20, 2014 1:20 pm
 
Forum: Personal Consumer Issues
Topic: We have a grocery problem... [Household budget]
Replies: 117
Views: 7128

Re: We have a grocery problem...

Step one is to separate out all the non-food items in that $230, along with alcoholic beverages as well. That could get it down to $180 a week for two, which is still a bit high. I buy a fair amount of SEAFOOD at my grocery store: lobsters @ $5/lb ; steamer clams @ $4/lb; swordfish @ $9/lb most rec...
by The Wizard
Sat Sep 20, 2014 11:58 am
 
Forum: Personal Consumer Issues
Topic: We have a grocery problem... [Household budget]
Replies: 117
Views: 7128

Re: So what the benckmark SWR for a 25 year retirement?

A lot of fresh air is wasted with arm-waving on SWR thinking. Trying to get down to fractional percent analysis is really not productive. (How much safer is a 3.8% WR vs a 4.2% WR, for instance...) One's AA in retirement, combined with Sequence of Returns uncertainty combined with Lifespan uncertai...
by The Wizard
Sat Sep 20, 2014 11:49 am
 
Forum: Investing - Help with Personal Investments
Topic: So what the benckmark SWR for a 25 year retirement?
Replies: 14
Views: 928

Re: IRA in a Personal Pension Annuity-Opinions please?

That's a 5.1% payout, so you might want to compare that to other SPIAs available to the general public, for females 59.5.
Assuming it's close to market rates, I'd be inclined to wait longer to get more inflation protection in my income stream...
by The Wizard
Sat Sep 20, 2014 11:38 am
 
Forum: Investing - Help with Personal Investments
Topic: IRA in a Personal Pension Annuity-Opinions please?
Replies: 6
Views: 348

Re: Why is there no mutual fund that truly behaves like rent

Yes, we discuss TREA a lot on that forum. But it's not available to the general public, so probably not worth discussing too much here. Is the same true (not available to the general public) for the TIAA traditional annuity products? I believe so, yes. But check the fine print in the link I posted ...
by The Wizard
Sat Sep 20, 2014 10:14 am
 
Forum: Investing - Theory, News & General
Topic: Why is there no mutual fund that truly behaves like rental?
Replies: 36
Views: 2401

Re: So what the benckmark SWR for a 25 year retirement?

A lot of fresh air is wasted with arm-waving on SWR thinking. Trying to get down to fractional percent analysis is really not productive. (How much safer is a 3.8% WR vs a 4.2% WR, for instance...) One's AA in retirement, combined with Sequence of Returns uncertainty combined with Lifespan uncertain...
by The Wizard
Sat Sep 20, 2014 10:08 am
 
Forum: Investing - Help with Personal Investments
Topic: So what the benckmark SWR for a 25 year retirement?
Replies: 14
Views: 928

Re: The Case Against Mid Caps? (Say it ain't so!)

The author sounds like a weasel for saying that large and small cap fund managers can just tilt their mix of stocks to mid cap to capture their premium.
I want my large cap fund to be large companies only, thank you...
by The Wizard
Sat Sep 20, 2014 9:54 am
 
Forum: Investing - Theory, News & General
Topic: The Case Against Mid Caps? (Say it ain't so!)
Replies: 23
Views: 2483

Re: So what the benckmark SWR for a 25 year retirement?

Not much different for 25 years, still around 4%. In fact, if you just put $1M into a bank account, it would be easy to remove 4% per year and deplete it entirely in 25 years, with a very modest sub-inflation increment each year, since 4% x 25 = 100%. But as you realize, these numbers are just guess...
by The Wizard
Sat Sep 20, 2014 9:18 am
 
Forum: Investing - Help with Personal Investments
Topic: So what the benckmark SWR for a 25 year retirement?
Replies: 14
Views: 928

Re: Help! Are we making a huge mistake?

For me, one factor would be how good the FOOD is in local eateries in the country they propose to send you to.
And can you give us some hint about what exactly your work consists of for such a large paycheck?
by The Wizard
Sat Sep 20, 2014 8:41 am
 
Forum: Personal Finance (Not Investing)
Topic: Help! Are we making a huge mistake?
Replies: 39
Views: 5010

Re: Are SPIA's fairly priced? - A quick and dirty analysis

My understanding is the Society of Actuaries Individual Annuitant Mortality tables (which you use) can't be used to estimate the life expectancy of any particular individual. Consider someone in good health who purchases an annuity at age 70. When they reach age 80 their health may have declined, b...
by The Wizard
Sat Sep 20, 2014 8:36 am
 
Forum: Investing - Theory, News & General
Topic: Are SPIA's fairly priced? - A quick and dirty analysis
Replies: 75
Views: 3393

Re: Why is there no mutual fund that truly behaves like rent

I looked it up and all I'm finding is a variable annuity from Tiaa Cref... Is there an actual mutual fund? That's it. Symbol/Abbreviation = TREA TIAA calls its mutual funds variable annuities; the difference probably matters to lawyers and regulators, but not to you and me. This distinction is prob...
by The Wizard
Sat Sep 20, 2014 8:16 am
 
Forum: Investing - Theory, News & General
Topic: Why is there no mutual fund that truly behaves like rental?
Replies: 36
Views: 2401

Re: Are SPIA's fairly priced? - A quick and dirty analysis

Another issue is that your comparison with investment return over the average life expectancy period (20.4 years) ignores the S-shaped curve of the actual graph of human mortality (while by definition 50% of the cohort are alive at L, many more than 75% are alive at L/2 and far fewer than 25% are a...
by The Wizard
Fri Sep 19, 2014 4:45 pm
 
Forum: Investing - Theory, News & General
Topic: Are SPIA's fairly priced? - A quick and dirty analysis
Replies: 75
Views: 3393

Re: Defined Benefit Plan and AA

Are you allowed to roll the cash value of that pension into your IRA when you retire? Or must you take it as a monthly payout? If you do have a rollover option, then you'll need to compute whether it's better to do that or retain the monthly payout. But for now, I'd treat it, along with SS, as a mon...
by The Wizard
Fri Sep 19, 2014 4:41 pm
 
Forum: Investing - Help with Personal Investments
Topic: Defined Benefit Plan and AA
Replies: 10
Views: 607

Re: Time Has Gone Quickly, 3 Months Till Retirement

A lot of BH retirees plan to maintain a 50/50 AA indefinitely through retirement.
But a lot of the AA decision depends on two things:
1) the total size of your portfolio relative to the amount you expect to withdraw each year
2) additional retirement income outside of your portfolio
by The Wizard
Fri Sep 19, 2014 4:08 pm
 
Forum: Investing - Help with Personal Investments
Topic: Time Has Gone Quickly, 3 Months Till Retirement
Replies: 17
Views: 1920

Re: Preparing for job rejection?

Alrighty.
So, is there a question about all this?
by The Wizard
Fri Sep 19, 2014 4:03 pm
 
Forum: Personal Finance (Not Investing)
Topic: Preparing for job rejection?
Replies: 16
Views: 1324

Re: Are SPIA's fairly priced? - A quick and dirty analysis

The analysis depends on what you assume for life expectancy, and what interest rate you use. If I were comparing the choice between an annuity and a lump sum, I would probably use a higher interest rate, to reflect the fact that the annuity is not readily marketable. I'm sure that insurance compani...
by The Wizard
Fri Sep 19, 2014 3:23 pm
 
Forum: Investing - Theory, News & General
Topic: Are SPIA's fairly priced? - A quick and dirty analysis
Replies: 75
Views: 3393

Re: Are SPIA's fairly priced? - A quick and dirty analysis

The analysis depends on what you assume for life expectancy, and what interest rate you use. If I were comparing the choice between an annuity and a lump sum, I would probably use a higher interest rate, to reflect the fact that the annuity is not readily marketable. I'm sure that insurance compani...
by The Wizard
Fri Sep 19, 2014 3:06 pm
 
Forum: Investing - Theory, News & General
Topic: Are SPIA's fairly priced? - A quick and dirty analysis
Replies: 75
Views: 3393

Re: Are SPIA's fairly priced? - A quick and dirty analysis

I tend to agree with Prof Emeritus' sources that annuitizing is a beneficial concept but nonetheless, I would really like to know what the Insurance Company's cut on a typical SPIA is. Stated more simply: If an actuarily perfect SPIA for a certain set of conditions yields $1000 a month for life, wha...
by The Wizard
Fri Sep 19, 2014 2:35 pm
 
Forum: Investing - Theory, News & General
Topic: Are SPIA's fairly priced? - A quick and dirty analysis
Replies: 75
Views: 3393

Re: Are SPIA's fairly priced? - A quick and dirty analysis

I also expect that actuaries look at the expected DISTRIBUTION of remaining lifespans starting at age 70, including guaranteed periods. (I have 10 year guarantees on my annuties...)
by The Wizard
Fri Sep 19, 2014 2:27 pm
 
Forum: Investing - Theory, News & General
Topic: Are SPIA's fairly priced? - A quick and dirty analysis
Replies: 75
Views: 3393

Re: Are SPIA's fairly priced? - A quick and dirty analysis

As swaption points out, that $100K is depleting over that time period, so you can't compute it as a lump sum at a fixed rate over 20 years. Use the Excel function for a mortgage payment instead. PPMT()?
by The Wizard
Fri Sep 19, 2014 2:23 pm
 
Forum: Investing - Theory, News & General
Topic: Are SPIA's fairly priced? - A quick and dirty analysis
Replies: 75
Views: 3393

Re: Time Has Gone Quickly, 3 Months Till Retirement

As G2BO says, there could be some market timing going on here, so think about that more. Further, a lot of Bogleheads have concluded that rebalancing INTO stocks during a market decline may NOT be the best idea in retirement, once your Human Capital valve is turned off. I don't totally agree with th...
by The Wizard
Fri Sep 19, 2014 2:09 pm
 
Forum: Investing - Help with Personal Investments
Topic: Time Has Gone Quickly, 3 Months Till Retirement
Replies: 17
Views: 1920

Re: Time Has Gone Quickly, 3 Months Till Retirement

Seems more like 12 months, but I know what you mean. I'm not a Bucket person, so I can't help you with that. It really comes down to a total Asset Allocation concept, whether you pretend things are in separate buckets or not. I can't quickly see what your proposed AA is (stocks: bonds: cash) and don...
by The Wizard
Fri Sep 19, 2014 1:55 pm
 
Forum: Investing - Help with Personal Investments
Topic: Time Has Gone Quickly, 3 Months Till Retirement
Replies: 17
Views: 1920

Re: Random Contributions

...The only time my checking account has >$500 is if a bill is due before the next biweekly pay check...I do "back of the envelope" calculations pretty much with each check, and any excess that's not needed for bills goes to VG. I probably take it a bit too far, actually, since this means...
by The Wizard
Fri Sep 19, 2014 1:50 pm
 
Forum: Investing - Help with Personal Investments
Topic: Random Contributions
Replies: 16
Views: 1131

Re: Random Contributions

I had regular income month to month while employed and now (mostly) while retired.
But my EXPENSES vary considerably month to month based on travel related expenditures as much as anything.
So I make what turn out to be random contributions to my New Vehicle Purchase Fund each month...
by The Wizard
Fri Sep 19, 2014 1:43 pm
 
Forum: Investing - Help with Personal Investments
Topic: Random Contributions
Replies: 16
Views: 1131

Re: We have a grocery problem...

runner9 wrote:I find going to the grocery store multiple times a week helps us keep our food waste down, as we don't have uncooked food going bad...

Good point.
Whenever I get live lobster or clams, they hit the cooking pot that same evening. Corn on the cob is better without aging also...
by The Wizard
Fri Sep 19, 2014 1:31 pm
 
Forum: Personal Consumer Issues
Topic: We have a grocery problem... [Household budget]
Replies: 117
Views: 7128

Re: We have a grocery problem...

One way to deal with this problem is to fly to Maui for a couple weeks in a rented condo. Buy groceries at the local Foodland supermarket for half of your meals or so. Then when you get back home, SMILE at how much more reasonable food prices are here. (Sidenote: I'm aware that the Costco in Kahalui...
by The Wizard
Fri Sep 19, 2014 1:26 pm
 
Forum: Personal Consumer Issues
Topic: We have a grocery problem... [Household budget]
Replies: 117
Views: 7128

Re: We have a grocery problem...

Mojave, I'm wondering if there's much WASTE in your food consumption.
Do you use leftovers efficiently either as snacks or in another meal? Or do they sit for a few days and then get tossed?
That can add up...
by The Wizard
Fri Sep 19, 2014 1:03 pm
 
Forum: Personal Consumer Issues
Topic: We have a grocery problem... [Household budget]
Replies: 117
Views: 7128

Re: We have a grocery problem...

Those frequent pit stops in the grocery stores eat up money. I am trying to stay at one grocery store visit a week... Oh come now, you know that's not really true. It could be true in my case that I'd spend more on GASOLINE for the (six mile?) RT to my favorite supermarket, but I usually combine tr...
by The Wizard
Fri Sep 19, 2014 12:53 pm
 
Forum: Personal Consumer Issues
Topic: We have a grocery problem... [Household budget]
Replies: 117
Views: 7128

Re: We have a grocery problem...

Step one is to separate out all the non-food items in that $230, along with alcoholic beverages as well. That could get it down to $180 a week for two, which is still a bit high. I buy a fair amount of SEAFOOD at my grocery store: lobsters @ $5/lb; steamer clams @ $4/lb; swordfish @ $9/lb most recen...
by The Wizard
Fri Sep 19, 2014 12:43 pm
 
Forum: Personal Consumer Issues
Topic: We have a grocery problem... [Household budget]
Replies: 117
Views: 7128

Re: How to Contact IRS to suspend tax levy on paycheck

OK, but it seems that the son is guilty of Tax Evasion, so discharge of the tax owed isn't feasible...
by The Wizard
Fri Sep 19, 2014 10:49 am
 
Forum: Personal Finance (Not Investing)
Topic: How to Contact IRS to suspend tax levy on paycheck
Replies: 25
Views: 1745

Re: How to Contact IRS to suspend tax levy on paycheck

These 1099's are self-employment income and can be offset on Schedule C by expenses incurred in producing the income. But, of course, "our hero" won't have any hard evidence of his expenses either. Nonetheless, the proper tax pro probably knows how to deal with this the best way. Do you go...
by The Wizard
Fri Sep 19, 2014 10:31 am
 
Forum: Personal Finance (Not Investing)
Topic: How to Contact IRS to suspend tax levy on paycheck
Replies: 25
Views: 1745

Re: Immediate payable annuity is a bad investment?

I am just curious, when you sign up for an SPIA, are there any fees associated with it? I don't think the "fees" are explicitly stated, but rather, are embedded in the whole transaction. Example: if no fees or Ins Co profits at all, you might get a payout of $6700 per year per $100,000 an...
by The Wizard
Fri Sep 19, 2014 10:11 am
 
Forum: Investing - Theory, News & General
Topic: Immediate payable annuity is a bad investment?
Replies: 45
Views: 2433

Re: How to Contact IRS to suspend tax levy on paycheck

$189,000 owed to the IRS in back taxes is, umm, QUITE A BIT for an individual. I have to say that ignorance isn't a really good excuse when dealing with tax issues, but right now he has to deal with the present situation and THEN do things better in the future. For the amount of money involved, I wo...
by The Wizard
Fri Sep 19, 2014 9:33 am
 
Forum: Personal Finance (Not Investing)
Topic: How to Contact IRS to suspend tax levy on paycheck
Replies: 25
Views: 1745

Re: Shuffling between TSP, Edward Jones, and Vanguard

We're not big fans of EJ here. Yes, move it all to Vanguard and use Bogleheads.org to get any advise you need regarding strategies. I'm not familiar with TSP intricacies, but I would continue making traditional tax-deferred contributions there until you have a few million and get within 5-10 years o...
by The Wizard
Fri Sep 19, 2014 9:16 am
 
Forum: Investing - Help with Personal Investments
Topic: Shuffling between TSP, Edward Jones, and Vanguard
Replies: 14
Views: 1336

Re: Immediate payable annuity is a bad investment?

To deal with inflation, it's nice to have access to inexpensive variable annuities that are based on stock market and/or real estate investments. That's what I have in TIAA-CREF but unfortunately, they are not available to the general public, so I'll not go on about them too much here...
by The Wizard
Fri Sep 19, 2014 9:09 am
 
Forum: Investing - Theory, News & General
Topic: Immediate payable annuity is a bad investment?
Replies: 45
Views: 2433

Re: Immediate payable annuity is a bad investment?

If you have children and want to leave some inheritance, SPIA does not sound very attractive (to me). However, if you do not want to leave some inheritance, I see buy SPIA is better than leave money to nobody (charity?). This is incorrect, as I've stated previously. Creating a Personal Pension by a...
by The Wizard
Fri Sep 19, 2014 8:14 am
 
Forum: Investing - Theory, News & General
Topic: Immediate payable annuity is a bad investment?
Replies: 45
Views: 2433

Re: Do I need to send in estimated tax????

That would lessen the penalty for sure...
by The Wizard
Thu Sep 18, 2014 9:07 pm
 
Forum: Personal Finance (Not Investing)
Topic: Do I need to send in estimated tax????
Replies: 31
Views: 1794
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