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Re: Health care tilt

Do you think the railroads saw nationalization coming before WWI? Airport security before 9/11? We aren't even talking about a black swan when just looking at the US history let alone what has happened in other developed nations. Terrible examples atop your paranoid fears. Railway nationalization o...
by avalpert
Tue Oct 21, 2014 10:04 pm
 
Forum: Investing - Theory, News & General
Topic: Health care tilt
Replies: 75
Views: 3315

Re: Health care tilt

Just to be contrarian, one could argue that investing in the healthcare sector is actually a great hedge to the risks of working in it. In any business, the rewards can go to capital or they can go to labor. If doctors get replaced by robots, who wins big? Healthcare companies. On the other hand, i...
by avalpert
Tue Oct 21, 2014 9:25 pm
 
Forum: Investing - Theory, News & General
Topic: Health care tilt
Replies: 75
Views: 3315

Re: Health care tilt

Sure but all it takes is the nationalization of the industry (and its profits) to turn it on its head. Probably shouldn't scare you away from working in it but should make you think twice about putting all your financial eggs in that same basket. Nationalization of the industry?! C'mon. Now we're g...
by avalpert
Tue Oct 21, 2014 9:22 pm
 
Forum: Investing - Theory, News & General
Topic: Health care tilt
Replies: 75
Views: 3315

Re: Why include International Index in AA?

Isn't the US something like 50% of the total world market? And aren't 50% of the S&P500 total earnings derived from foreign revenues/earnings? So the S&P500 is already aligned with total world weightings - at least for the largest weighted component (US). A total world index/fund such as VT...
by avalpert
Tue Oct 21, 2014 9:06 pm
 
Forum: Investing - Theory, News & General
Topic: Why include International Index in AA?
Replies: 11
Views: 647

Re: Health care tilt

As a physician, none of the things mentioned above scare me at all. Maybe they should, but they don't. We practice medicine in a completely different way than just 10 years ago. Things have changes in a multitude of ways since I start med school. However, what really matter is that health care util...
by avalpert
Tue Oct 21, 2014 8:56 pm
 
Forum: Investing - Theory, News & General
Topic: Health care tilt
Replies: 75
Views: 3315

Re: Gross Yearly Income needed in Retirement (Speculation)

Point being, it costs money to go to this Kruger Park in South Africa for a couple weeks; I've not been, but other Bogleheads apparently have. It doesn't have to cost much at all to go to Kruger Park for a couple of weeks - rent a car (don't even need 4x4 there) and a tent, self drive around the pa...
by avalpert
Tue Oct 21, 2014 8:53 pm
 
Forum: Personal Finance (Not Investing)
Topic: Gross Yearly Income needed in Retirement (Speculation)
Replies: 43
Views: 1863

Re: Gross Yearly Income needed in Retirement (Speculation)

I'm targeting $150k a year which is in line with our current spending (though we would be trading spending on kids, including private school, for spending on us). I'm 15 years from my target early retirement date and am quite certain much will change but that is my current SWAG.
by avalpert
Tue Oct 21, 2014 8:38 pm
 
Forum: Personal Finance (Not Investing)
Topic: Gross Yearly Income needed in Retirement (Speculation)
Replies: 43
Views: 1863

Re: Gross Yearly Income needed in Retirement (Speculation)

Point being, it costs money to go to this Kruger Park in South Africa for a couple weeks; I've not been, but other Bogleheads apparently have. It doesn't have to cost much at all to go to Kruger Park for a couple of weeks - rent a car (don't even need 4x4 there) and a tent, self drive around the pa...
by avalpert
Tue Oct 21, 2014 8:36 pm
 
Forum: Personal Finance (Not Investing)
Topic: Gross Yearly Income needed in Retirement (Speculation)
Replies: 43
Views: 1863

Re: Health care tilt

Do you want to be a primary care physician or hospital operator these days? No. Do you want to be in biotech or instruments inventing new drugs and robots? Absolutely. The pertinent question is do I want to be in them to a higher/lesser degree than the degree to those whose profession is to analyze...
by avalpert
Tue Oct 21, 2014 7:17 pm
 
Forum: Investing - Theory, News & General
Topic: Health care tilt
Replies: 75
Views: 3315

Re: What Are We Doing To Our Young Investors?

It eliminates the illusion that what is automatically chosen will be specifically appropriate for that person. TR funds imply they are appropriate for people in that age range. Balanced fund makes no such claim. But 'default investment' provides the same illusion - at least based on the research th...
by avalpert
Tue Oct 21, 2014 5:30 pm
 
Forum: Investing - Theory, News & General
Topic: What Are We Doing To Our Young Investors?
Replies: 23
Views: 2957

Re: What Are We Doing To Our Young Investors?

I can agree that the automatic enrollment option should probably not be a TR fund, but rather something more like a balanced fund. Just because these funds are marketed towards people of a certain age, that doesn't mean that they are appropriate for someone because they are that age. How does a sin...
by avalpert
Tue Oct 21, 2014 5:26 pm
 
Forum: Investing - Theory, News & General
Topic: What Are We Doing To Our Young Investors?
Replies: 23
Views: 2957

Re: What Are We Doing To Our Young Investors?

I can agree that the automatic enrollment option should probably not be a TR fund, but rather something more like a balanced fund. Just because these funds are marketed towards people of a certain age, that doesn't mean that they are appropriate for someone because they are that age. How does a sin...
by avalpert
Tue Oct 21, 2014 4:56 pm
 
Forum: Investing - Theory, News & General
Topic: What Are We Doing To Our Young Investors?
Replies: 23
Views: 2957

Re: Stocks as long term investments

because you are simply putting more money in J&J than its market cap would indicate. Off topic from the OP, but a genuine question - if I've $20,000 to add to stocks and I fancy tilting to tech sector stocks, why should I drop three times as much into MSFT than as much invested into Cisco simpl...
by avalpert
Tue Oct 21, 2014 4:27 pm
 
Forum: Investing - Theory, News & General
Topic: Stocks as long term investments
Replies: 46
Views: 2794

Re: "Differentiated" vs. "Segregated" asset allocation

I must be missing something because this looks like one of the worst analysis I have ever seen. Unless I am doing my math wrong it appears as though they didn't just move around where assets were located but adjusted the total risk exposure of the portfolios - the 'differentiated' approach has highe...
by avalpert
Tue Oct 21, 2014 4:10 pm
 
Forum: Investing - Help with Personal Investments
Topic: "Differentiated" vs. "Segregated" asset allocation
Replies: 3
Views: 250

Re: What Are We Doing To Our Young Investors?

Having said all this, I really wonder if these investors are removing money because of downturns or just because they needed some money and didn't have any other funds--nothing for short term goals, nothing for emergencies. Or because they assumed it was part of severing ties with their previous em...
by avalpert
Tue Oct 21, 2014 3:16 pm
 
Forum: Investing - Theory, News & General
Topic: What Are We Doing To Our Young Investors?
Replies: 23
Views: 2957

Re: Health care tilt

So my last post on this. If you can compare healthcare to railroads or car manufacturing then we don't have much to discuss. Next you will tell me food may go out of style or maybe even water. Food may never go out of style but that doesn't mean concentrating on it as a financial sector was ever se...
by avalpert
Tue Oct 21, 2014 1:13 pm
 
Forum: Investing - Theory, News & General
Topic: Health care tilt
Replies: 75
Views: 3315

Re: Health care tilt

If you want to believe that doctors (which we have a shortage of) may have to worry about finding a job, be my guest. Right, and railroads are the future of transportation, Detroit the new capital of manufacturing and a law degree a guaranteed ticket to a job. That disruptions to sectors tend to bl...
by avalpert
Tue Oct 21, 2014 10:15 am
 
Forum: Investing - Theory, News & General
Topic: Health care tilt
Replies: 75
Views: 3315

Re: Health care tilt

Healthcare is everything you said about it and this human capital thing is just plain silly when you try to apply it to a doctor in the united states. You will be able to stay employed and if you can't, it won't be because of the healthcare industry. Geeze, thinking your industry is immune to tail ...
by avalpert
Mon Oct 20, 2014 8:09 pm
 
Forum: Investing - Theory, News & General
Topic: Health care tilt
Replies: 75
Views: 3315

Re: 50/50

Check it against to what end? A 50/50 spit of Total Stock and Total Bond is a perfectly fine benchmark for a 50/50 portfolio - why would you need a separate fund? If you truly want to set and forget and never deal with rebalancing bands.... or irrational fear. it's why a lot of target date funds ar...
by avalpert
Mon Oct 20, 2014 9:45 am
 
Forum: Investing - Help with Personal Investments
Topic: 50/50
Replies: 7
Views: 1143

Re: Is the backdoor Roth IRA legal?

JustinR wrote:I know that technically it is. But is it really?

There is no distinction between something being technically legal and really legal - all law is is a set of technical rules.

If you mean to ask is it ethical that is a different debate but probably not appropriate for this forum.
by avalpert
Sun Oct 19, 2014 8:25 pm
 
Forum: Investing - Theory, News & General
Topic: Is the backdoor Roth IRA legal?
Replies: 13
Views: 1712

Re: WSJ's Jon Clements: "How to Make Your Savings Outlive Yo

P.S. We spend our working lives intuitively adjusting our spending to our somewhat variable and unpredictable income. Nobody ever suggests running a Monte Carlo analysis of one's future earnings. Nobody ever suggests that your spending at age 25 should be governed by statistical projections of your...
by avalpert
Sun Oct 19, 2014 8:13 pm
 
Forum: Investing - Theory, News & General
Topic: WSJ's Jon Clements: "How to Make Your Savings Outlive You"
Replies: 14
Views: 2715

Re: 50/50

Check it against to what end? A 50/50 spit of Total Stock and Total Bond is a perfectly fine benchmark for a 50/50 portfolio - why would you need a separate fund?
by avalpert
Sun Oct 19, 2014 8:01 pm
 
Forum: Investing - Help with Personal Investments
Topic: 50/50
Replies: 7
Views: 1143

Re: Why not 100% Stocks?

Problem is your house doesn't generate income Sure it does, just because you pay it to yourself doesn't change that. You could always rent it out and get a rental yourself. and can't be partially sold. Real estate isn't the only investment that is illiquid - if it weren't their 'home' but instead a...
by avalpert
Sun Oct 19, 2014 2:35 pm
 
Forum: Investing - Theory, News & General
Topic: Why not 100% Stocks?
Replies: 274
Views: 20223

Re: Health care tilt

I absolutely see that argument and makes sense to me. On the other hand I believe investing in an area of inside knowledge can be smart also. Like if I worked at Goldman Sachs or something I would probably invest in the financial sector or maybe trade the index etc. I tend to follow the industry cl...
by avalpert
Sun Oct 19, 2014 9:24 am
 
Forum: Investing - Theory, News & General
Topic: Health care tilt
Replies: 75
Views: 3315

Re: Health care tilt

This is a fair point. However, I do not hold the total stock fund in large amounts because of my preference for a slice and dice portfolio. I am simply making the argument that a separate health care fund is a valuable "slice" in that philosophy. I wish there was more research available o...
by avalpert
Sun Oct 19, 2014 9:18 am
 
Forum: Investing - Theory, News & General
Topic: Health care tilt
Replies: 75
Views: 3315

Re: What's a good fund to do a backdoor Roth IRA with?

Why would you take yourself out of the market if you don't have to? Sow hat if it gains/loses that is why you are investing in the fund of your choice to begin with - worst case is it goes up a bit in the short period of time it takes to transfer and you pay a little bit of taxes on the gains.
by avalpert
Sun Oct 19, 2014 9:09 am
 
Forum: Investing - Theory, News & General
Topic: What's a good fund to do a backdoor Roth IRA with?
Replies: 5
Views: 567

Re: Why not 100% Stocks?

the term "100% stocks" is a simplification that describes only the allocation of one's investment portfolio, and when a person says she is 100% stocks, she shouldn't need to defend herself against the definition police. People can say whatever they want and don't have to defend themselves...
by avalpert
Sat Oct 18, 2014 11:01 pm
 
Forum: Investing - Theory, News & General
Topic: Why not 100% Stocks?
Replies: 274
Views: 20223

Re: Can I reduce my *retirement* savings rate?

So I'll give you my honest feedback after reading this thread and I'm not trying to be negative here. I have a similar issue. -I think you are over-analyzing your future retirement. The fact that you mull over it daily and are pouring through calculations and spreadsheets, this can become unhealthy...
by avalpert
Fri Oct 17, 2014 1:51 pm
 
Forum: Investing - Help with Personal Investments
Topic: Can I reduce my *retirement* savings rate?
Replies: 35
Views: 3271

Re: When bogleheads do TLH

Rather than a percentage, my threshold is absolute in dollars. I use $3000 of loss to trigger a TLH -- (1) because that is how much you can deduct on your taxes in one year (2) makes it easy to see when to do TLH. I recently did one with the TISM fund when it crossed $3000 mark. I'm not sure that m...
by avalpert
Fri Oct 17, 2014 1:32 pm
 
Forum: Investing - Help with Personal Investments
Topic: When bogleheads do TLH
Replies: 6
Views: 838

Re: Can I reduce my *retirement* savings rate?

I think you are overcomplicating this question - you certainly aren't the first family to try to decide if you should be a single-income or dual-income household. Really it boils down to can you live on your salary alone and still be able to save enough for full retirement saving 20% of gross income...
by avalpert
Fri Oct 17, 2014 11:29 am
 
Forum: Investing - Help with Personal Investments
Topic: Can I reduce my *retirement* savings rate?
Replies: 35
Views: 3271

Re: Tax gain harvest smaller gains from taxable to fund 529s

I wouldn't, don't really see an advantage to paying taxes now that can be deferred for later and you can put new money into a 529 over time instead of increasing your taxable portfolio.
by avalpert
Thu Oct 16, 2014 10:40 pm
 
Forum: Investing - Help with Personal Investments
Topic: Tax gain harvest from taxable to fund 529s / Roth IRAs?
Replies: 3
Views: 320

Re: How did you get from $1M to $10M

I would try roulette, baccarat or craps
by avalpert
Thu Oct 16, 2014 4:14 pm
 
Forum: Personal Finance (Not Investing)
Topic: How did you get from $1M to $10M
Replies: 46
Views: 3994

Re: Balance Transfer Credit Card 1% fee, no APR for 1 year

If you miss even one of their requirements, you'll lose big doing this. They have dozens of people thinking about how to get your wealth transferred to them. You are one person trying to think of the reverse. It is a fool's game in the long run. I don't think this is necessarily fair - they have do...
by avalpert
Thu Oct 16, 2014 4:11 pm
 
Forum: Personal Finance (Not Investing)
Topic: Balance Transfer Credit Card 1% fee, no APR for 1 year
Replies: 9
Views: 345

Re: Balance Transfer Credit Card 1% fee, no APR for 1 year

Currency risk isn't enough for you? For ~$150 in gains its hard to justify the effort and risk.
by avalpert
Thu Oct 16, 2014 3:07 pm
 
Forum: Personal Finance (Not Investing)
Topic: Balance Transfer Credit Card 1% fee, no APR for 1 year
Replies: 9
Views: 345

Re: Find a way to explain to me "WHY" should I break up w/ M

I have been unsuccessful in cutting and pasting the Morningstar Chart to this page. At Morningstar please chart VTWSX vs MDISX Chart at Morningstar from 15SEP1994 until present. If anyone could post this Chart for me I would be grateful because a picture is worth thousands of words! This CHART best...
by avalpert
Thu Oct 16, 2014 1:34 pm
 
Forum: Investing - Help with Personal Investments
Topic: Find a way to explain to me "WHY" should I break up w/ MDISX
Replies: 23
Views: 1101

Re: investing in bear market

Agreed - to the Oracle you listen: “Whether socks or stocks, I like buying quality merchandise when it is marked down.” I just read a comment from an interview he did last week where he compared it to going to the supermarket and buying hamburger when it is on sale. That folks need to think of inve...
by avalpert
Thu Oct 16, 2014 11:24 am
 
Forum: Investing - Help with Personal Investments
Topic: investing in bear market
Replies: 29
Views: 2238

Re: $72k in 3 fund or a $72k 2 bed/1 bath condo rented

BogleBoogie wrote:
avalpert wrote:OP - what does the rest of your portfolio look like? Is it invested in as 3 funds with a 65/25 mix? What are you hoping to accomplish with this relatively small slice of your portfolio?


More importantly, where is the remaining 10% from the "65/25" mix??

That's my commission
by avalpert
Wed Oct 15, 2014 11:08 pm
 
Forum: Investing - Help with Personal Investments
Topic: $72k in 3 fund or a $72k 2 bed/1 bath condo rented
Replies: 21
Views: 1475

Re: $72k in 3 fund or a $72k 2 bed/1 bath condo rented

OP - what does the rest of your portfolio look like? Is it invested in as 3 funds with a 65/35 mix? What are you hoping to accomplish with this relatively small slice of your portfolio?
by avalpert
Wed Oct 15, 2014 10:02 pm
 
Forum: Investing - Help with Personal Investments
Topic: $72k in 3 fund or a $72k 2 bed/1 bath condo rented
Replies: 21
Views: 1475

Re: $72k in 3 fund or a $72k 2 bed/1 bath condo rented

The stock market is overpriced now (that's why it's falling) while real estate is still underpriced. Since you're committing a sum of money all at once you can't dollar cost average, so timing does indeed matter. I would buy the condo. Was the stock market underpriced on Monday and that was why it ...
by avalpert
Wed Oct 15, 2014 9:59 pm
 
Forum: Investing - Help with Personal Investments
Topic: $72k in 3 fund or a $72k 2 bed/1 bath condo rented
Replies: 21
Views: 1475

Re: U.S. stocks in freefall

Since MOST of the shares of stock in the world are not bought or sold on any given day, that means that MOST share owners also feel that their stocks are worth more to them than the market is currently offering. It also means that MOST non share owners don't feel the stock is worth what those share...
by avalpert
Wed Oct 15, 2014 9:41 pm
 
Forum: Investing - Theory, News & General
Topic: U.S. stocks in freefall
Replies: 941
Views: 156491

Re: Find a way to explain to me "WHY" should I break up w/ M

I'm not going to tell you what you should do nor going to dig too much into MDISX's history to do a proper analysis - but just a quick look tells me that since changing managers in late '09 it has slightly trailed a 50/50 blend of the VFINX and VEA (a large cap US and large cap International fund) w...
by avalpert
Wed Oct 15, 2014 6:21 pm
 
Forum: Investing - Help with Personal Investments
Topic: Find a way to explain to me "WHY" should I break up w/ MDISX
Replies: 23
Views: 1101

Re: The SWR on Real Estate Investments

Is market efficiency necessary for the study to be valid? Shouldn't the impact of the market inefficiencies show up in the data used by the study? Reliable data availability may be a big challenge. The issue is if you are particularly skillful at buying and managing real estate, you can add real va...
by avalpert
Wed Oct 15, 2014 3:10 pm
 
Forum: Investing - Theory, News & General
Topic: The SWR on Real Estate Investments
Replies: 61
Views: 2349

Re: The SWR on Real Estate Investments

Putting all of your money in a single company stock is speculating. Is putting all your money in a single property not speculating? You ever buy a house? Especially your first one? I did, and as an investment it was absolutely speculation. So anyone and everyone who buys a house that they plan on l...
by avalpert
Wed Oct 15, 2014 3:06 pm
 
Forum: Investing - Theory, News & General
Topic: The SWR on Real Estate Investments
Replies: 61
Views: 2349

Re: The SWR on Real Estate Investments

So, if you can't take 6% because of that risk, how much can you take? Is it 4% like a stock/bond portfolio, or somewhere in between the net operating income and the 4% rule? To figure that I think you would need to look at actual experienced volatilities in real estate returns - basically do the tr...
by avalpert
Wed Oct 15, 2014 2:31 pm
 
Forum: Investing - Theory, News & General
Topic: The SWR on Real Estate Investments
Replies: 61
Views: 2349

Re: The SWR on Real Estate Investments

Putting all of your money in a single company stock is speculating. Is putting all your money in a single property not speculating? You ever buy a house? Especially your first one? I did, and as an investment it was absolutely speculation. Buying any property CAN be speculation. If you are investin...
by avalpert
Wed Oct 15, 2014 2:25 pm
 
Forum: Investing - Theory, News & General
Topic: The SWR on Real Estate Investments
Replies: 61
Views: 2349

Re: The SWR on Real Estate Investments

Putting all of your money in a single company stock is speculating. Is putting all your money in a single property not speculating? Public stock markets are not the end all be all for investment options. That is certainly true - they just happen to be one of the most accessible ways to get broad di...
by avalpert
Wed Oct 15, 2014 2:05 pm
 
Forum: Investing - Theory, News & General
Topic: The SWR on Real Estate Investments
Replies: 61
Views: 2349

Re: The SWR on Real Estate Investments

So, if you can't take 6% because of that risk, how much can you take? Is it 4% like a stock/bond portfolio, or somewhere in between the net operating income and the 4% rule? To figure that I think you would need to look at actual experienced volatilities in real estate returns - basically do the tr...
by avalpert
Wed Oct 15, 2014 1:10 pm
 
Forum: Investing - Theory, News & General
Topic: The SWR on Real Estate Investments
Replies: 61
Views: 2349

Re: The SWR on Real Estate Investments

Here is a real data point for discussion... Property purchased in 1997 for approximately $150k. Financed with 15-year at 8% - $17.2k annual payment. Other first year expenses : maintenance/repair - $5k, taxes - $3k, insurance - $2k Gross 1st year rent (ballpark guess) - $28k First year profit - ess...
by avalpert
Wed Oct 15, 2014 1:01 pm
 
Forum: Investing - Theory, News & General
Topic: The SWR on Real Estate Investments
Replies: 61
Views: 2349

Re: What is common for a severance package?

I think the range of what is common is wide enough that you really can't do meaningful planning (besides assuming zero new cash flow) on what the particular situation may be for your wife until it happens.
by avalpert
Wed Oct 15, 2014 11:23 am
 
Forum: Personal Finance (Not Investing)
Topic: What is common for a severance package?
Replies: 25
Views: 1801

Re: The SWR on Real Estate Investments

But at any rate, if you can only get 4% out of your stock/bond funds, and you can get 6% out of a rental property, it seems a rather large advantage to have some real estate in the portfolio to me. Wait a second, I can get 4% out of stocks/bonds based on simulations using past data - and you can ge...
by avalpert
Wed Oct 15, 2014 10:32 am
 
Forum: Investing - Theory, News & General
Topic: The SWR on Real Estate Investments
Replies: 61
Views: 2349
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