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Moving--Rent or Sell Current Home

I'm moving soon. I was going to ask if I should rent or sell my current home. But, I decided to spend a couple of hours and make a spreadsheet for it. https://docs.google.com/spreadsheets/d/1H_9AdijsJYiBOrFvcyYc3lBstnoK_i-xGbcpNjv2r0U/edit?usp=sharing I assume a 8% discount rate (predicted stock mar...
by davidlukewilcox
Sat Nov 01, 2014 12:00 am
 
Forum: Personal Finance (Not Investing)
Topic: Moving--Rent or Sell Current Home
Replies: 0
Views: 37

Re: Mortgage Options For Home

Another way to look at it is, do you feel it is more advantageous to have more cash flow (and flexibility) or build equity in the house? Or why not take the 30 yr fixed and pay down extra towards principle? You'd have to be disciplined enough to do that though but it gives you a little more flexibi...
by davidlukewilcox
Thu Oct 23, 2014 5:27 pm
 
Forum: Personal Finance (Not Investing)
Topic: Mortgage Options For Home
Replies: 16
Views: 1055

Re: Mortgage Options For Home

I just talked to my lender. Regarding the 15-year loan. He says that it would be at 2.75% with a monthly payment of $1810 or so.
by davidlukewilcox
Thu Oct 23, 2014 4:42 pm
 
Forum: Personal Finance (Not Investing)
Topic: Mortgage Options For Home
Replies: 16
Views: 1055

Re: Mortgage Options For Home

Watty, Thanks so much for the response. You also didn’t mention if using any of the $185K in assets would cause you to pay things like capital gains taxes. If so that would favor a smaller down payment. Good point. I can make a 20% downpayment by only selling securities at a loss basically. I've alr...
by davidlukewilcox
Thu Oct 23, 2014 4:26 pm
 
Forum: Personal Finance (Not Investing)
Topic: Mortgage Options For Home
Replies: 16
Views: 1055

Mortgage Options For Home

Hi, My wife and I are going to buy a home soon. I need to figure out what mortgage option I want to do. Home costs $335k. I have First, no matter what else, I negotiated with my buyer's agent that he keeps $2k of his 3% commission. I keep the rest and can apply it to closing costs. Not counting 401k...
by davidlukewilcox
Thu Oct 23, 2014 3:20 pm
 
Forum: Personal Finance (Not Investing)
Topic: Mortgage Options For Home
Replies: 16
Views: 1055

Re: American Express Blue preferred vs Sallie Mae Mastercard

I have a Sallie Mae Mastercard. I use it on Amazon all the time. I've gotten 5% cash back on almost every purchase. There is a $750 per month limit. I say almost because i seem to remember one weird purchase where i didn't. But in general all amazon and marketplace purchases are included. Another pr...
by davidlukewilcox
Sun Sep 28, 2014 4:32 pm
 
Forum: Personal Consumer Issues
Topic: American Express Blue preferred vs Sallie Mae Mastercard
Replies: 5
Views: 812

Re: Should I get an HSA?

IcedTea, I plan on doing that exact same plan when I get an HSA. The money is not taxed at any point as long as you save receipts and take it out in retirement for health needs. Even in retirement, though, after age 65 or so, it's treated just like an IRA (no penalties, but taxes for withdrawals for...
by davidlukewilcox
Thu Sep 25, 2014 10:59 pm
 
Forum: Personal Finance (Not Investing)
Topic: Should I get an HSA?
Replies: 17
Views: 1056

Re: ESPP

It seems like you already know the answer. Just to do the math... Assume you sell twice a year as soon as you get the stock. Assume that the stock makes no major fluctuations during those two days. How much do you need to put into the plan each period in order to break even? X=X/.85-$50 X=1.18*X-$50...
by davidlukewilcox
Sun Aug 17, 2014 12:14 pm
 
Forum: Investing - Help with Personal Investments
Topic: ESPP [Employee Stock Purchase Plan]
Replies: 4
Views: 430

Re: Upcoming changes to my 401K - Please help me adjust my A

Sorry, either your post is confusing to me, or I'm tired from a brand new baby. I'll try my best to help you out where I can. Regarding #1, if you need the money in two years or so, it seems like the best you should do is some type of short-term CD or if you're OK with losing a little bit of princip...
by davidlukewilcox
Sat Jul 26, 2014 6:00 am
 
Forum: Investing - Help with Personal Investments
Topic: Upcoming changes to my 401K - Please help me adjust my AA
Replies: 6
Views: 769

Re: Purchasing Food at Work

I'll come out of my lurker corner for this one. I'm normally scoffed at at work for what I do. My wife bought me a rice cooker awhile ago. Then I buy bulk brown rice for about $0.55 per pound and keep a large bag with me. Then I find canned beans on sale for $0.45 per can. Overall, I spend about $0....
by davidlukewilcox
Fri Jul 18, 2014 12:22 am
 
Forum: Personal Consumer Issues
Topic: Purchasing Food at Work
Replies: 41
Views: 4224

Re: Advice for a private mortgage

You should think about reporting this gift to the irs.
by davidlukewilcox
Sun May 18, 2014 4:26 pm
 
Forum: Personal Finance (Not Investing)
Topic: Advice for a private mortgage
Replies: 12
Views: 905

Re: First Mortgage Payment

My payment is due on the 1st. I have a late penalty after the 15th. I called the mortgage company to set up automatic payments. They said that the only date that they will deduct money is the 5th. I asked if I could pay before the 5th using automatic payments. They said "No." I have had no...
by davidlukewilcox
Sat May 17, 2014 9:30 am
 
Forum: Personal Finance (Not Investing)
Topic: First Mortgage Payment
Replies: 18
Views: 959

Which Medical Plan Should I Switch To?

Hi, My wife and I are going to have a baby in July. My question is whether or not I should switch insurance plans when this happens. The two plans are: 1) Healthfund. I have a healthfund with $4000 in it. Someone else owns this $4000, not me, but it will be used for medical expenses before I pay any...
by davidlukewilcox
Sat May 03, 2014 9:52 am
 
Forum: Personal Finance (Not Investing)
Topic: Which Medical Plan Should I Switch To?
Replies: 2
Views: 567

Re: Rank These 401(k) Providers

I have Vanguard and my wife has had Transamerica at her previous job and Principal now. My brother-in-law has John Hancock. Out of all four, I like principal the best, mainly because they have a few cheap stock index funds to keep me happy (.1% ER) and they allow after-tax 401k contributions. To me...
by davidlukewilcox
Sun Mar 30, 2014 11:00 am
 
Forum: Personal Finance (Not Investing)
Topic: Rank These 401(k) Providers
Replies: 32
Views: 2567

Re: Rank These 401(k) Providers

I have Vanguard and my wife has had Transamerica at her previous job and Principal now. My brother-in-law has John Hancock. Out of all four, I like principal the best, mainly because they have a few cheap stock index funds to keep me happy (.1% ER) and they allow after-tax 401k contributions. To me,...
by davidlukewilcox
Sun Mar 30, 2014 2:42 am
 
Forum: Personal Finance (Not Investing)
Topic: Rank These 401(k) Providers
Replies: 32
Views: 2567

Re: Financial Status Review

Do you remember what happened to the Enron employees who owned a large portion of company stock? Poof, all gone! Enough said. The Boglehead philosophy: Do not take on too much. or too little, risk. Also, Warren Buffet never makes a sell decision based on tax consequences. You should be happy you ha...
by davidlukewilcox
Fri Mar 07, 2014 11:43 pm
 
Forum: Investing - Help with Personal Investments
Topic: Financial Status Review
Replies: 8
Views: 886

Re: Financial Status Review

The stock purchase plan seems scary, only a 15% discount and you have to hold for two years. Kind of sucks. Seems like what executives get, not regular employees. I'd try to reduce the risk here, pay the taxes if you must but reduce the exposure. I think you misunderstood how it works. I lock in a ...
by davidlukewilcox
Fri Mar 07, 2014 11:40 pm
 
Forum: Investing - Help with Personal Investments
Topic: Financial Status Review
Replies: 8
Views: 886

Financial Status Review

Hey, I think I've had enough life changes that I should get my financial status reviewed by the kind people here. I did a previous one about a year and a half ago here: http://www.bogleheads.org/forum/viewtopic.php?f=1&t=105836 Emergency funds: None Debt: $161,000 30-year mortgage @3.25% Tax Fil...
by davidlukewilcox
Fri Mar 07, 2014 2:26 pm
 
Forum: Investing - Help with Personal Investments
Topic: Financial Status Review
Replies: 8
Views: 886

Re: Can Vanguard Become Too Big?

Yes. Vanguard can become too big.

All of the math that says that chasing alpha doesn't matter and you shouldn't do it depends on other people chasing alpha. If no one else is chasing alpha, then indexing becomes the wrong thing to do, and stock picking is the way to achieve maximum return.
by davidlukewilcox
Wed Mar 05, 2014 10:12 am
 
Forum: Investing - Theory, News & General
Topic: Can Vanguard Become Too Big?
Replies: 24
Views: 3823

Help Reporting RSUs on Taxes

Hi, I have a question on what I'm supposed to do with RSUs on my taxes. In 2012, I sold some RSUs. When I did my taxes, ETrade had nothing in the "Cost Basis" column. That made me think, "Oh. These shares were *given* to me, so the cost is zero." So, I put that as my cost basis. ...
by davidlukewilcox
Sat Feb 22, 2014 7:38 pm
 
Forum: Personal Finance (Not Investing)
Topic: Help Reporting RSUs on Taxes
Replies: 4
Views: 458

Re: 401k Overcontribution

I believe you can only add after-tax contributions after you reach the $17500 limit. In your case, you have to wait until 2014. As previously mentioned, rolling over the old 401k has limited your options. I'm confused about this. If I'm allowed to contribute after-tax contributions after the $17,50...
by davidlukewilcox
Thu Oct 31, 2013 5:14 pm
 
Forum: Investing - Help with Personal Investments
Topic: 401k Overcontribution
Replies: 19
Views: 1141

Re: 401k Overcontribution

Just to be clear, these after tax contributions are not roth? And they do not count toward the 17,500 limit? Does anyone have any IRS pages where I can read more about these? Does the employer match count toward the 17,500 limit?
by davidlukewilcox
Thu Oct 31, 2013 3:06 pm
 
Forum: Investing - Help with Personal Investments
Topic: 401k Overcontribution
Replies: 19
Views: 1141

401k Overcontribution

My wife got laid off shortly ago. Her 401k did not match at all. Nonetheless, we had already contributed the legal maximum for the year. She has contributed 17,500 into that 401k this year. After she got laid off, we rolled this 401k over to Vanguard almost immediately. She's found a new job, and th...
by davidlukewilcox
Thu Oct 31, 2013 6:09 am
 
Forum: Investing - Help with Personal Investments
Topic: 401k Overcontribution
Replies: 19
Views: 1141

Re: Grok Tip 15 You're doing it wrong: Figuring stock/bond s

Grok, It seems like to be fair, if we're going to start calculating things like living expenses (mortgage) as part of our asset allocation (which I agree it should be to be realistic), we should also estimate other expenses like groceries, etc as part of this negative bond. If I spend $100 per month...
by davidlukewilcox
Thu Oct 17, 2013 11:18 pm
 
Forum: Investing - Theory, News & General
Topic: Grok Tip 15 You're doing it wrong: Figuring stock/bond split
Replies: 156
Views: 12736

Re: Software engineering jobs not paying that much?

I agree with curmudgeon. Glassdoor categorizes by job title, not career. They have a separate categorization for "Senior Software Engineer". They seem to get paid much more.
by davidlukewilcox
Wed Oct 16, 2013 10:35 pm
 
Forum: Personal Finance (Not Investing)
Topic: Software engineering jobs not paying that much?
Replies: 25
Views: 3285

Re: Best site for purchasing bonds

I don't know of any site to buy individual bonds. That said, Why do you want to invest in individual bonds? It seems irrational to me. Individual bonds have problems that are solved by bond funds: 1) Lack of liquidity of principal. 2) Undiversified in one organization. By investing in individual bon...
by davidlukewilcox
Tue Oct 08, 2013 9:19 pm
 
Forum: Investing - Help with Personal Investments
Topic: Best site for purchasing bonds
Replies: 9
Views: 1005

Re: Cutting Term Life Insurance Duration Short

Are you factoring in child care costs appropriately? Seems like $9k/kid/year is very low when I know childcare can easily cost $1000/month per child. I guess if my wife puts the kids in a day care, that means that she has a job. In that case, I assume that she would only take the job if it was more...
by davidlukewilcox
Mon Aug 12, 2013 1:23 pm
 
Forum: Investing - Help with Personal Investments
Topic: Cutting Term Life Insurance Duration Short
Replies: 16
Views: 850

Cutting Term Life Insurance Duration Short

Hi, I was wanting some help on term life insurance duration. I'm 27. My wife is 24. We don't have kids yet, but probably will in the future. When we do, I need to buy life insurance. I played around with quotes on term4sale and noticed that going from a 20 year duration and it quoted me about $19.50...
by davidlukewilcox
Mon Aug 12, 2013 9:51 am
 
Forum: Investing - Help with Personal Investments
Topic: Cutting Term Life Insurance Duration Short
Replies: 16
Views: 850

Re: Diversifiable vs Systematic risk - dad likes to pick sto

Honestly, your dad seems a heck of a lot like mine. My dad used to be a petroleum engineer. For the past five to ten years or so, he has taken up active management of some sort, mostly commodity investing. He keeps most of his money in cash at the credit union though. At one point, when my mortgage ...
by davidlukewilcox
Sun Jul 21, 2013 10:46 pm
 
Forum: Investing - Help with Personal Investments
Topic: Diversifiable vs Systematic risk - dad likes to pick stocks
Replies: 28
Views: 1456

Re: Diversifiable vs Systematic risk - dad likes to pick sto

I think you're right, at a basic level. Problem is, there are two additional issues: 1 - In order to service this strategy, my dad has a huge portion of his portfolio in uninvested cash, waiting for buying opportunities. This cash isn't earning any return. 2 - He sells calls and puts rather than ou...
by davidlukewilcox
Sun Jul 21, 2013 10:41 pm
 
Forum: Investing - Help with Personal Investments
Topic: Diversifiable vs Systematic risk - dad likes to pick stocks
Replies: 28
Views: 1456

Re: Diversifiable vs Systematic risk - dad likes to pick sto

Someone's not likely to spend a whole portfolio on a vacation though. Davidlukewilcox said that this is "most of his [dad's] portfolio." I assert that the dad is not taking on much more risk than he otherwise would've in a TSM fund (the opportunity cost here). Given that the dad has a por...
by davidlukewilcox
Sun Jul 21, 2013 9:36 pm
 
Forum: Investing - Help with Personal Investments
Topic: Diversifiable vs Systematic risk - dad likes to pick stocks
Replies: 28
Views: 1456

Re: Diversifiable vs Systematic risk - dad likes to pick sto

Can anyone recommend a good introductory article to the value of diversification, or about diversifiable vs systematic risk? Just as an example, consider that you are in the business of insuring cargo ships. Consider that in any one year, you always collect $1,000,000 in insurance premiums. You als...
by davidlukewilcox
Sun Jul 21, 2013 9:32 pm
 
Forum: Investing - Help with Personal Investments
Topic: Diversifiable vs Systematic risk - dad likes to pick stocks
Replies: 28
Views: 1456

Re: Diversifiable vs Systematic risk - dad likes to pick sto

First, it's easy to show mathematically that diversification does not increase or decrease average return. It merely lowers risk. This may allow you to invest in riskier assets and this increase return risk adjusted. That said, I'm not sure what your dad is doing is a huge deal. 1. It sounds like he...
by davidlukewilcox
Sun Jul 21, 2013 12:40 pm
 
Forum: Investing - Help with Personal Investments
Topic: Diversifiable vs Systematic risk - dad likes to pick stocks
Replies: 28
Views: 1456

Re: Donating Shares To Charity Is An Option?

afan, I do not want to do this myself since I'm a regular Joe Shmoe. Like I said, it's not economical for people like me myself to do this, just as a regular Joe Shmoe does not index by himself. He buys a fund. MNFinance, I don't want to do this myself. Like both you and I pointed out, it's not econ...
by davidlukewilcox
Tue Jul 02, 2013 1:18 pm
 
Forum: Investing - Theory, News & General
Topic: Donating Shares To Charity Is An Option?
Replies: 6
Views: 580

Donating Shares To Charity Is An Option?

Hi, I give quite a bit to charity each year. I have realized that I can give appreciated securities to charity. When I do so, I get the full deduction for the market value of the securities, but nobody pays taxes on that market value. I do this when the shares rise. When shares fall in price, I can ...
by davidlukewilcox
Tue Jul 02, 2013 10:56 am
 
Forum: Investing - Theory, News & General
Topic: Donating Shares To Charity Is An Option?
Replies: 6
Views: 580

Re: Need opinions about my broker's strategy

The options selling strategy is awful! It dramatically increases your exposure to risk. Worse, brokers are incentivized to do this risky approach instead of an approach that yields exactly the same amount, but is less risky. First, I will discuss how this approach is risky. What your broker is doing...
by davidlukewilcox
Thu May 23, 2013 8:59 am
 
Forum: Investing - Help with Personal Investments
Topic: Need opinions about my broker's strategy
Replies: 45
Views: 2420

Re: Treat your mortgage as a "negative exposure" to bonds?

My post will probably be glossed over, but I feel that it provides a new insight into the discussion. If we're going to include our mortgages as a negative bond (which I agree with since it is a fixed payment out every month), then we should also include our jobs as a positive bond (since it is a fi...
by davidlukewilcox
Sat Feb 02, 2013 3:43 pm
 
Forum: Investing - Theory, News & General
Topic: Treat your mortgage as a "negative exposure" to bonds?
Replies: 188
Views: 8750

Re: tuitition tax credit vs 529 usage

I've already the IRS publication and multiple other sources, but I still disagree. Did you read my earlier post in this thread? I disagree that the $4,000 must be paid from another source. Instead, the $4,000 just reduces the amount of Adjusted Qualified Higher Eduation Expenses. I also disagree th...
by davidlukewilcox
Sun Jan 20, 2013 1:10 am
 
Forum: Personal Finance (Not Investing)
Topic: tuitition tax credit vs 529 usage
Replies: 10
Views: 1050

Re: tuitition tax credit vs 529 usage

If your income is within the limits and the bill is $30,000, minus the $10,000 for the scholarship leaves $20000. Therefore, you can only take $16000 from the 529 account so you can pay the $4000 from another source (not 529). How did you reach this conclusion? Do you have a source? Yes. The source...
by davidlukewilcox
Sat Jan 19, 2013 6:36 pm
 
Forum: Personal Finance (Not Investing)
Topic: tuitition tax credit vs 529 usage
Replies: 10
Views: 1050

Re: What to Invest in - Real estate, or buy a business?

Thanks. That looks good. How would I live off the interest on this? Are there dividends or would I sell x number of shares monthly if I wanted to live on interest? I can understand your aversion to stocks. It seems like the SEC is always putting people behind bars for stealing peoples' money in som...
by davidlukewilcox
Fri Jan 18, 2013 4:45 am
 
Forum: Investing - Help with Personal Investments
Topic: What to Invest in - Real estate, or buy a business?
Replies: 24
Views: 1734

Re: 529 Plan Not So Great?

I think that contributing to a 529 even to get the state tax breaks is futile if you can't use the money. You could contribute to the 529 to the amount that you are relatively sure that you will use the money. If you are unsure if you will use the money, then your state tax break had better be prett...
by davidlukewilcox
Sun Dec 23, 2012 4:25 pm
 
Forum: Investing - Help with Personal Investments
Topic: 529 Plan Not So Great?
Replies: 14
Views: 1084

529 Plan Not So Great?

Hi, I've been reviewing the IRS literature on 529 plans this morning and believe that 529 plans are not a great savings vehicle for higher education many times. The crux of the issue is that you can only make withdrawals from 529 plans for "qualified higher educational expenses". However, ...
by davidlukewilcox
Sun Dec 23, 2012 3:44 pm
 
Forum: Investing - Help with Personal Investments
Topic: 529 Plan Not So Great?
Replies: 14
Views: 1084

Re: No Mortgage/Debt

Investing is better than paying off a mortgage by your tax deduction only when you are putting the investment in a tax-preferred account. Let us assume for simplicity that you have two options: 1) Pay down your mortgage. 2) Buy a share of your mortgage in a brokerage account, so that you are now the...
by davidlukewilcox
Tue Dec 18, 2012 1:01 pm
 
Forum: Personal Finance (Not Investing)
Topic: No Mortgage/Debt
Replies: 65
Views: 4554

Re: Cash versus Pay-off Part of Mortgage

A simple way to increase monthly income after you retire is to withdraw cash from the pile of cash you still have that you did not use to pay off the mortgage. Now that I wrote that, here is how taxes can be reduced: Paying off a mortgage can reduce the cash flow needed to make the mortgage payment...
by davidlukewilcox
Tue Nov 27, 2012 9:52 pm
 
Forum: Investing - Help with Personal Investments
Topic: Cash versus Pay-off Part of Mortgage
Replies: 42
Views: 2435

Re: Portfolio Review

Thank you for the link, livesoft, about putting cash needs in tax-preferred accounts. I will start doing that ASAP. I think I also agree with you about my wife maxing out her 401k right now. She's going to quit in the next few years anyway, and I can roll over to Vanguard when she does.
by davidlukewilcox
Thu Nov 22, 2012 1:38 pm
 
Forum: Investing - Help with Personal Investments
Topic: Portfolio Review
Replies: 9
Views: 484

Re: Portfolio Review

Taylor,

I changed the percentages to reflect portfolio total and put my desired asset allocation beneath my bio.
by davidlukewilcox
Thu Nov 22, 2012 1:01 pm
 
Forum: Investing - Help with Personal Investments
Topic: Portfolio Review
Replies: 9
Views: 484

Re: Donate to Charity With ESPP?

OK. In that case, it seems like the best thing to do would be to sell the company shares immediately, immediately put them into a diversified fund as to minimize risk, and then gift from that fund. Is this what you would consider the best thing to do?
by davidlukewilcox
Thu Nov 22, 2012 12:18 pm
 
Forum: Investing - Help with Personal Investments
Topic: Donate to Charity With ESPP?
Replies: 16
Views: 681

Portfolio Review

I've been a long-time forum lurker, but have been reluctant to post my portfolio since I've believed I've been doing everything basically OK and didn't want anyone to tell me that I was wrong. I decided today to swallow my pride and am ready for fresh insights. Emergency funds: Kind of... I keep eno...
by davidlukewilcox
Thu Nov 22, 2012 12:16 pm
 
Forum: Investing - Help with Personal Investments
Topic: Portfolio Review
Replies: 9
Views: 484

Re: Donate to Charity With ESPP?

3) Keep the company stock around. This means I do not realize the 15% gain immediately and do not pay taxes on it. A year later, once it qualifies for long-term capital gains, 1. It's a 17.6% gain. Agreed. Sorry I wasn't precise. 2. The discount is always taxed as ordinary income regardless of hold...
by davidlukewilcox
Thu Nov 22, 2012 11:37 am
 
Forum: Investing - Help with Personal Investments
Topic: Donate to Charity With ESPP?
Replies: 16
Views: 681

Re: Donate to Charity With ESPP?

Taxes are due upon sale. I have to hold the shares for either 1, 1.5 or 2 years (I can't remember exactly right now, but that detail probably doesn't matter much) for them to be qualified for long-term capital gains.
by davidlukewilcox
Thu Nov 22, 2012 10:51 am
 
Forum: Investing - Help with Personal Investments
Topic: Donate to Charity With ESPP?
Replies: 16
Views: 681
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