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Re: Total International still more tax efficient than Total

Do these findings imply reconsideration of the advice typically offered here (to place international equities in taxable account) or is these results more likely an exception to the rule of international equity funds being more tax efficient than domestic equity funds on account of the foreign tax ...
by bdpb
Wed Jan 22, 2014 1:16 am
 
Forum: Investing - Theory, News & General
Topic: Total International still more tax efficient than Total US?
Replies: 31
Views: 2313

Re: Priority of Investment Roth 401 vs (T) 401k

At these tax rates (you didn't mention the state tax), contribute the deductible max to both 401k. Then contribute back-door Roth for her. Is it possible to roll your IRA into your 401k? If so, back-door Roth for you. Then pay down debt. Again, you didn't mention your mortgage rate or school debt ra...
by bdpb
Fri Jan 17, 2014 3:03 am
 
Forum: Investing - Help with Personal Investments
Topic: Priority of Investment Roth 401 vs (T) 401k
Replies: 7
Views: 472

Re: Retirement and Short Term Suggestions

Fed tax rate of 28% and CA of 9.3% is high. Almost everyone will retire in lower tax brackets and/or have other chances to withdraw at lower rates than that. I would follow every rule about tax efficient investing to avoid these taxes. Start with contributing deductible 17.5k to your excellent 401k....
by bdpb
Tue Jan 14, 2014 10:59 pm
 
Forum: Investing - Help with Personal Investments
Topic: Retirement and Short Term Suggestions
Replies: 5
Views: 1056

Re: Need advice on investment and AA if forced into early re

Age:52 Work in semiconductor industry under an abusive boss; talked to HR but have no reason to expect any positive outcome; believe myself targeted for layoff within the next 6 months; have tried to find another job for the past 12 months but have no luck thus far (salary, age, over-qualification,...
by bdpb
Sun Jan 12, 2014 1:19 pm
 
Forum: Investing - Help with Personal Investments
Topic: Need advice on investment and AA if forced into early retire
Replies: 11
Views: 876

Re: Questions on AA over multiple 401k/IRA accounts

Thanks. I realize that my auto loans are out of whack. It definitely is a lesson learned. My wife and I both make 60k base salary which does not count match or benefits so maybe you are getting at that. I just got 25% from a website. My family will grow next month so it will be hard but maybe I hav...
by bdpb
Sat Jan 11, 2014 11:19 pm
 
Forum: Investing - Help with Personal Investments
Topic: Questions on AA over multiple 401k/IRA accounts
Replies: 6
Views: 555

Re: Questions on AA over multiple 401k/IRA accounts

Debt: Student loans 4.4k ($106/mo), 2 car loans totaling 39k ($739/mo), 219k mortgage ($1653/mo) Tax Filing Status: Married filing jointly this year (we have a baby coming next month so that will change for 2014) Age: Him 29 / Her 26 New annual Contributions $5.4khis 401k including match $12k her 4...
by bdpb
Sat Jan 11, 2014 9:39 pm
 
Forum: Investing - Help with Personal Investments
Topic: Questions on AA over multiple 401k/IRA accounts
Replies: 6
Views: 555

Re: Take tax hit to move to lower cost fund?

Presumably, both funds are the same tax efficiency (given index funds), otherwise this should be in your calculation, too. Are there different tax lots? Are there some lots with less gains? If so, you may only want to sell some of it. Obviously, stop dividend reinvestment. Does selling a portion eac...
by bdpb
Mon Jan 06, 2014 11:27 pm
 
Forum: Investing - Help with Personal Investments
Topic: Take tax hit to move to lower cost fund?
Replies: 12
Views: 852

Re: Beginner looking for feedback

There's no need to feel intimidated, you're doing great.
by bdpb
Mon Jan 06, 2014 10:39 pm
 
Forum: Investing - Help with Personal Investments
Topic: Beginner looking for feedback
Replies: 8
Views: 793

Re: Portfolio Advice - 29 yo resident with poor 401k funds

^^^ In general, I would agree with PoeticalDeportment about division of assets. In your case I wouldn't worry about it because it should only be a short term (3+ years) imbalance. Presumably, after residency you will be saving a lot more. You will then likely fill up 457, 403, 401 and have taxable s...
by bdpb
Mon Jan 06, 2014 10:26 pm
 
Forum: Investing - Help with Personal Investments
Topic: Portfolio Advice - 29 yo resident with poor 401k funds
Replies: 13
Views: 1067

Re: Advice Request - Paying off Mortgage

You have $150K/year in income; $1.090M in investments/cash; and a $90K mortgage. Borrowing money to buy a house let you save and invest a lot of money in your 30s and 40s. Now, you are in great shape and don't need to continue borrowing money. The mortgage almost becomes a nuisance at this point. I...
by bdpb
Sun Jan 05, 2014 11:15 pm
 
Forum: Personal Finance (Not Investing)
Topic: Advice Request - Paying off Mortgage
Replies: 13
Views: 1357

Re: Taking the 3-fund plunge, request review, have some ?s..

bdpb: I've been watching with keen interest all the threads that pop up on the "pay off the mortgage" topic here (which is very often!) because it's definitely an option. It seems to come down to comfort & liquidity. I think I might need to stay more liquid during the move, then consi...
by bdpb
Sun Jan 05, 2014 8:33 pm
 
Forum: Investing - Help with Personal Investments
Topic: Taking the 3-fund plunge, request review, have some ?s..
Replies: 19
Views: 1974

Re: Newbie about rebalence entire protfolio

I'm sorry. I meant he currently makes $180k but can live on $30k plus what he will get from ss. I'm still missing a couple of things. If he "makes" 180k, he should probably not be in the 28% bracket. Subtract 20k deductions/exemptions. Subtract at least 10k for 401k contributions (which c...
by bdpb
Sun Jan 05, 2014 5:24 pm
 
Forum: Investing - Help with Personal Investments
Topic: Newbie about rebalence entire protfolio
Replies: 8
Views: 308

Re: Newbie about rebalence entire protfolio

Thanks for your reply. His income is actually $180k. This is what he is telling me he can live on, modestly. If he is going to live on 180k in retirement and the only income is SS and investments and he expects to use 30k from investments, that would require 150k from SS. There seems to be a discon...
by bdpb
Sun Jan 05, 2014 3:14 pm
 
Forum: Investing - Help with Personal Investments
Topic: Newbie about rebalence entire protfolio
Replies: 8
Views: 308

Re: 29yo, $4M Windfall - Need Guidance

1) How is my portfolio of mutual funds doing? What about it should I alter, and what should I leave alone? Please pick it apart for me! 2) What should my asset allocation be? Previously I had been saving for retirement with an age-based allocation of 10% bonds / 90% stocks. Now it seems like retire...
by bdpb
Sun Jan 05, 2014 2:46 pm
 
Forum: Investing - Help with Personal Investments
Topic: 29yo, $4M Windfall - Need Guidance
Replies: 12
Views: 2042

Re: Newbie about rebalence entire protfolio

Doesn't seem like the tax rate is correct. At 28%, their taxable income would be up around 150k. Unless they lower their standard of living in retirement, with 30k from investments, they would require SS of 120k. I don't think that's possible. You should follow the guidelines in the following post: ...
by bdpb
Sun Jan 05, 2014 2:27 pm
 
Forum: Investing - Help with Personal Investments
Topic: Newbie about rebalence entire protfolio
Replies: 8
Views: 308

Re: Taking the 3-fund plunge, request review, have some ?s..

Debt: Mortgage $296k remaining @ 4.25% (~$2k/mo), planning to move & sell in next 2 yrs. No other debt. Taxable (Vanguard) 15.5% CA tax-exempt MMF, effectively cash, (VCTXX) (0.16%) 3.3% tot bond adm (VBTLX) (0.10%) New annual Contributions Taxable: $3k/year automatic, plus a variable portion o...
by bdpb
Sun Jan 05, 2014 1:56 am
 
Forum: Investing - Help with Personal Investments
Topic: Taking the 3-fund plunge, request review, have some ?s..
Replies: 19
Views: 1974

Re: To payoff mortgage or not

True... and I didn't meant to totally minimize the mortgage interest deduction. I, like the OP, don't quite meet the standard deduction with the interest I pay on my primary mortgage. I do still itemize, because like you say, once I add property tax, sales tax, and all I do still get over teh stand...
by bdpb
Sat Jan 04, 2014 5:44 pm
 
Forum: Investing - Help with Personal Investments
Topic: To payoff mortgage or not
Replies: 59
Views: 2885

Re: To payoff mortgage or not

BTW, I am still keen on paying it off in the next few years. Also, I am not planning to liquidate my $140k portfolio to pay off the mortgage as some thought (partly my fault). You should reconsider whether selling your taxable account to payoff the mortgage is a good idea or not. If your taxable ac...
by bdpb
Sat Jan 04, 2014 12:51 pm
 
Forum: Investing - Help with Personal Investments
Topic: To payoff mortgage or not
Replies: 59
Views: 2885

Re: Priority among after-tax 401(k), HSA, back-door Roth and

kcb203 wrote:5) Putting anything else into taxable.


Replace 5 only.
by bdpb
Thu Jan 02, 2014 5:55 pm
 
Forum: Investing - Help with Personal Investments
Topic: Priority among after-tax 401(k), HSA, back-door Roth and 529
Replies: 2
Views: 240

Re: Wife's 401k help

On a related note, my wife has ~200k available to rollover from a previous employer. She can't leave it with them due to conflict of interest issues. Is this 401k plan worth rolling into or should she roll to an IRA. Would eliminate her backdoor ROTH availability. http://www.bogleheads.org/forum/vi...
by bdpb
Mon Dec 30, 2013 5:25 pm
 
Forum: Investing - Help with Personal Investments
Topic: Wife's 401k help
Replies: 5
Views: 531

Re: Newbie Here, 401k and Roth Guidance Requested

Tax Rate: I make $50-$55 K a year so I’m in the %25 tax bracket. I’m in Colorado so I also pay a %4.63 State Income tax. New annual Contributions 401K: It looks like I’ll be contributing about $500 a month, including the employer match. So about $6000 annually. Roth IRA: I’ll be contributing $230 a...
by bdpb
Mon Dec 23, 2013 9:39 pm
 
Forum: Investing - Help with Personal Investments
Topic: Newbie Here, 401k and Roth Guidance Requested
Replies: 8
Views: 604

Re: BogleHead Financial Jury Evaluation

justsavemore wrote:Age:49

New annual Contributions
$17,500 his 401k (plus 4% employer matching)
$5,000 his Roth IRA
$10,000 taxable


If you turn 50 in 2014, you can make catch-up contributions to 401k and IRA, another $5500 and $1000, respectively.
by bdpb
Sat Dec 21, 2013 11:14 pm
 
Forum: Investing - Help with Personal Investments
Topic: BogleHead Financial Jury Evaluation
Replies: 7
Views: 876

Re: Have a few really bad losses back from 2007

I have a 7k gain right now in my taxable account. I was planning to sell 7k in losses to offset the gains. The remaining losses I was going to sell off next year to offset next years gains. These were purchased back in 2007. I now have index funds. We all make mistakes when we first start out inves...
by bdpb
Sat Dec 21, 2013 11:28 am
 
Forum: Investing - Help with Personal Investments
Topic: Have a few really bad losses back from 2007
Replies: 13
Views: 774

Re: Have a few really bad losses back from 2007

Depending on your tax situation, it may make sense to sell these after Jan 1, 2014. If you have no carryover losses and no significant gains this year, you should pay CG tax on your current gains at 15% or 0%. Then, sell your losers in 2014 and take the CG loss at your marginal tax rate of 25% or 15%.
by bdpb
Sat Dec 21, 2013 2:22 am
 
Forum: Investing - Help with Personal Investments
Topic: Have a few really bad losses back from 2007
Replies: 13
Views: 774

Re: Max 403b or backdoor Roth?

Doesn't seem like it should be an either/or question. If you are going to be in the 33% bracket, you should have plenty of income to: Max your 403b Max your Roth Max your HSA Spouse max 403b/401k Spouse max Roth Spouse max HSA pay down school debt pay down mortgage debt use 529 finally, taxable inve...
by bdpb
Sat Dec 21, 2013 1:56 am
 
Forum: Investing - Help with Personal Investments
Topic: Max 403b or backdoor Roth?
Replies: 13
Views: 823

Re: Near-identical Accounts

Your suggestions make perfect sense to me. One of my other concerns was whether using the same fund in taxable and tax-advantaged accounts was considered an investment faux pas. Since your recommendations make use of this very strategy I assume it is quite acceptable. Having at least one overlappin...
by bdpb
Tue Dec 17, 2013 11:06 pm
 
Forum: Investing - Help with Personal Investments
Topic: Near-identical Accounts
Replies: 3
Views: 444

Re: Near-identical Accounts

4. I like the idea of a three fund portfolio. However, I believe I can take on a little more risk and would like to increase my exposure to small-caps beyond what the Vanguard Total U.S. Stock Market Index Fund allocates. 5. Since I am a huge fan of simplicity, The "However" part of 4 doe...
by bdpb
Tue Dec 17, 2013 4:59 pm
 
Forum: Investing - Help with Personal Investments
Topic: Near-identical Accounts
Replies: 3
Views: 444

Re: Gifting stock to family

hicabob wrote:Vanguard requires you go through the Medallion Signature process to do the same, but other than that it's straightforward enough.


If you sign up for Voice Verification you do not need a Medallion Signature.
by bdpb
Sun Dec 15, 2013 12:31 am
 
Forum: Personal Finance (Not Investing)
Topic: Gifting stock to family
Replies: 10
Views: 471

Re: New investor - 403(b), 401(k), Roth IRA

Tax Rate: 15% Federal, 5% State State of Residence: IL 3. Since I am going to max my Roth IRA for 2013, how soon should I max it out for 2014? My goal is to have 3 funds as soon as possible. Which 3 should they be? Year to year, should I prioritize seeking to diversify (to bonds, REITs) or invest t...
by bdpb
Wed Dec 11, 2013 9:33 pm
 
Forum: Investing - Help with Personal Investments
Topic: New Physician Investor - Retirement Planning
Replies: 2
Views: 410

Re: 27 Year Old Starting Investing - Seeking Portfolio Advic

Maybe consider no bonds if I can stomach volatility per bdpb. I'm 27 and like to invest very aggressively. I'm 10% bonds, which many here would criticize even for someone who is very aggressive. 0% bonds is very probably a bad idea. The time to take risk is when one is young and has lots of human c...
by bdpb
Mon Dec 09, 2013 10:30 am
 
Forum: Investing - Help with Personal Investments
Topic: 27 Year Old Starting Investing - Seeking Portfolio Advice
Replies: 14
Views: 1707

Re: 27 Year Old Starting Investing - Seeking Portfolio Advic

So my 2014 plan should be: 1) Put 21% or $14,700 of my total paychecks into my 401k for 2014 which with the $2,800 company match will be $17,500. If I do that it drops my taxable income to $61,300. 3) Pay off student loan debt as fast as possible. What if I put $14,500 towards the 4% loan and keep ...
by bdpb
Sun Dec 08, 2013 4:57 pm
 
Forum: Investing - Help with Personal Investments
Topic: 27 Year Old Starting Investing - Seeking Portfolio Advice
Replies: 14
Views: 1707

Re: 27 Year Old Starting Investing - Seeking Portfolio Advic

6. Am I missing anything else =)? Tax Rate: 25% Federal 9.30% State At these tax rates, I would put the max in my 401k before anything else (including Roth and especially taxable). A $5500 Roth contribution could be over $8333 deductible 401k contribution. After max the 401k, max the Roth, then pay...
by bdpb
Sat Dec 07, 2013 11:43 pm
 
Forum: Investing - Help with Personal Investments
Topic: 27 Year Old Starting Investing - Seeking Portfolio Advice
Replies: 14
Views: 1707

Re: Quality Virtual Investment Portfolio

Why not use a Target Retirement fund? Over five years it will basically hold the same AA. But, what's the point? Do you expect the evidence going forward to be different from the existing evidence? If not, why not just present him the Boglehead literature? If he still doesn't listen or comes to a di...
by bdpb
Sat Dec 07, 2013 11:18 pm
 
Forum: Investing - Help with Personal Investments
Topic: Quality Virtual Investment Portfolio
Replies: 6
Views: 424

Re: Beginning Roth IRA

I'm an absolute beginner to investment. I have a 403(b) through work, and that's pretty much what I have in terms of investment. I have been reading up the advantages of having a Roth IRA, and would like to start one in the next few weeks. I do not have the time or knowledge at this point to active...
by bdpb
Wed Dec 04, 2013 9:27 am
 
Forum: Investing - Help with Personal Investments
Topic: Beginning Roth IRA
Replies: 22
Views: 2550

Re: Mom's 401k plan tune-up

The bright side: she has access to Fidelity's Spartan Advantage class funds. My question is, should I rebalance her into a portfolio consisting of: FUSVX - Spartan SP 500 ER 0.07 FSEVX - Spartan Ext. Market ER 0.07 FSITX - Spartan Bond ER 0.17 FSIVX - Spartan International ER 0.17 Does she have acc...
by bdpb
Tue Dec 03, 2013 8:27 pm
 
Forum: Investing - Help with Personal Investments
Topic: Mom's 401k plan tune-up
Replies: 9
Views: 548

Re: Portfolio Help for 29 yo couple. Thanks!

Debt: $90,000 home mortgage @ 5.125%, her $105,000 medical school loan at 6.8% Tax Rate: 28% Federal, 5% State Taxable 17% Vanguard Target Retirement 2050 (VFIFX) (.18 ER) 3% Vanguard Total International Stock Index Investor Shares (VGTSX) (.22 ER) Future Contributions In 2014 we plan to max out: •...
by bdpb
Mon Dec 02, 2013 10:20 pm
 
Forum: Investing - Help with Personal Investments
Topic: Portfolio Help for 29 yo couple. Thanks!
Replies: 12
Views: 1663

Re: Liquidate Roth/HSA principal (to remove PMI) and family

The past two years we have done the following each year: - Max (2) Roth IRAs - Max (1) Family HSA - Contribute up to the matching of our respective 401Ks Anything leftover was sent to our loans/goals. This leftover amount will be between $3,300 to $5,100 per month. 2. Or don't touch prior investmen...
by bdpb
Thu Nov 28, 2013 10:07 pm
 
Forum: Investing - Help with Personal Investments
Topic: Liquidate Roth/HSA principal (to remove PMI) and family loan
Replies: 10
Views: 705

Re: Liquidate Roth/HSA principal (to remove PMI) and family

And by the same logic, you should take money out of the Roth if you need to remove the PMI. Since you aren't maxing out your retirement accounts, you won't waste the tax-deferred savings; the money that you took out of the Roth, plus interest, will be available for future IRA and 401(k) contributio...
by bdpb
Thu Nov 28, 2013 5:04 pm
 
Forum: Investing - Help with Personal Investments
Topic: Liquidate Roth/HSA principal (to remove PMI) and family loan
Replies: 10
Views: 705

Re: Liquidate Roth/HSA principal (to remove PMI) and family

BogleBear wrote:Technically we fall into the 25% federal tax bracket.

But with itemized deduction we typically fall between 10 - 13% effective.


Your marginal rate is what's important. I would maximize deductible contributions in the 25% bracket.

Is there a state tax, too?
by bdpb
Thu Nov 28, 2013 9:17 am
 
Forum: Investing - Help with Personal Investments
Topic: Liquidate Roth/HSA principal (to remove PMI) and family loan
Replies: 10
Views: 705

Re: Liquidate Roth/HSA principal (to remove PMI) and family

What is your tax rate? I wouldn't worry too much about the PMI. It's great to get rid of it, but it probably only adds about .5% to your effective interest rate costs of the loan. I would be more concerned about losing 25% income tax deduction for retirement contributions. At these relatively low in...
by bdpb
Thu Nov 28, 2013 9:06 am
 
Forum: Investing - Help with Personal Investments
Topic: Liquidate Roth/HSA principal (to remove PMI) and family loan
Replies: 10
Views: 705

Re: Feedback Requested on Long-term Investing Strategy

Overview Emergency funds: Yes, 3 months Tax Rate: 15% Federal bracket, 5% State State of Residence: Illinois Contributions New annual Contributions $5,000 his 401k (calendar 2013) $0 taxable (for retirement, not short term goals) Questions: 1. 401k: Is my ER too high at .7%? Do I have too much fund...
by bdpb
Tue Nov 26, 2013 10:19 pm
 
Forum: Investing - Help with Personal Investments
Topic: Feedback Requested on Long-term Investing Strategy
Replies: 14
Views: 1086

Re: Advice for young saver

Cash: 13.9k (11.8 in high yield savings at .8%) Debt: 4.2k student loans @ 5.6 % Notes: On Jan 1 I'll max out my roth ira (5.5k) with the total stock index, and then around April I'll pay off my zero interest credit card (~5k), taking up most of my cash. Questions: I've been putting all of my pay r...
by bdpb
Thu Nov 14, 2013 11:24 pm
 
Forum: Investing - Help with Personal Investments
Topic: Advice for young saver
Replies: 4
Views: 591

Re: Taxable invest vs. Mortgage w/cash on the sidelines

debt is mortgage 203k remaining @ 3.75, 23 years remaining. we anticipate moving in 4-7 years depending on how things go. If you're really going to move in a few years, any payment you make on this mortgage will effectively act like a 4-7 year taxable CD earning 3.75%. After maxing all tax advantag...
by bdpb
Mon Nov 11, 2013 11:13 pm
 
Forum: Investing - Help with Personal Investments
Topic: Taxable invest vs. Mortgage w/cash on the sidelines
Replies: 5
Views: 510

Re: Advice for my mother

Are you sure about the NJ tax rate?

Seems like the NJ tax rate should be over 5 or 6%.
by bdpb
Sun Nov 10, 2013 10:00 pm
 
Forum: Investing - Help with Personal Investments
Topic: Advice for my mother
Replies: 21
Views: 2429

Re: 23 y/o Retirement Review

Correct, I plan on directing it away from my emergency fund. I don't plan on needing the money soon but would rather not lock it up in the 401(k). I'm guessing something like 5-10 years. Thanks for the two scenarios for BrokerageLink, it was pretty surprising to me to see how hard that $100 is to o...
by bdpb
Mon Apr 29, 2013 5:48 pm
 
Forum: Investing - Help with Personal Investments
Topic: 23 y/o Retirement Review
Replies: 10
Views: 1213

Re: Allan Roth: Fixing [The] Obama's Finances"

It's not a mistake for someone in the highest tax brackets to hold stocks in their IRA and Treasuries in taxable. At 39.6% tax on .7 Treasury yield, the tax cost is about 28 bp per year. At 23.5% QD plus 5% state tax on stocks yielding 2%, the tax cost is 57 bp per year (plus additional CG taxes som...
by bdpb
Sun Apr 28, 2013 3:50 pm
 
Forum: Investing - Help with Personal Investments
Topic: Allan Roth: Fixing [The] Obama's Finances"
Replies: 22
Views: 2512

Re: 23 y/o Retirement Review

Tax Rate: 25% Federal, 9.3% State Roth IRA at Vanguard - $25,220, 94.3% New annual Contributions 15% of salary, ~$7425, into my 401k (Company matches 25% up to the IRS maximum) Funds available in my 401(k) BROKERAGELINK Roth IRA contributions can be withdrawn tax and penalty free. You should do tha...
by bdpb
Sat Apr 27, 2013 9:07 pm
 
Forum: Investing - Help with Personal Investments
Topic: 23 y/o Retirement Review
Replies: 10
Views: 1213

Re: New 401k Options for 24 Year Old

Looks good. If you will be maxing out your 401k and Roth in future years, you should stop paying extra on the debt such that you can max out the 401k and Roth this year, too. Any other thoughts on this. I currently have 15,000 left out of the 59,000 I started with. The effective interest rate is 5....
by bdpb
Thu Apr 25, 2013 3:14 pm
 
Forum: Investing - Help with Personal Investments
Topic: New 401k Options for 24 Year Old
Replies: 6
Views: 459

Re: Selling Home. Put towards current mortgage or invest?

Thanks for the input everyone. I see a couple of recos to refinance. If I do, wouldn't I (best case) be going down just .25% or so? Do you think I could get a refi at 3% or less (which may make sense doing)? If I can only get 3.25 or 3.5%, is it worth the refi cost (which may get absorbed into the ...
by bdpb
Thu Apr 25, 2013 2:01 pm
 
Forum: Investing - Help with Personal Investments
Topic: Selling Home. Put towards current mortgage or invest?
Replies: 6
Views: 453
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