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Re: Buffett vs. Bogleheads

*sigh* Whenever anyone brings up the Buffet portfolio, there's always a string of posts saying that it's "for billionaires only". But it's clear that Buffett doesn't see the portfolio that way. His consistent advice to ordinary investors is to " hold enough cash to be comfortable and...
by dbr
Thu Oct 02, 2014 10:33 am
 
Forum: Investing - Theory, News & General
Topic: Buffett vs. Bogleheads
Replies: 25
Views: 1640

Re: Leaving a legacy

I have seen far more kids parlay family support into useful careers and full lives than I have seen trust fund addicts and spend thrifts. The failures I have seen were well on their way long before the slides were greased with largesse. That process starts with the personal character of the original...
by dbr
Thu Oct 02, 2014 9:24 am
 
Forum: Personal Finance (Not Investing)
Topic: Leaving a legacy
Replies: 19
Views: 557

Re: Buffett vs. Bogleheads

Lots of good replies, and some things to think about. However, I failed to put enough information in my original post which started this thread. So, time frame: ten years. Amount invested: $10,000. Buffett: 10% bond fund, 90% stock, index funds. Boglehead: 50/50 stock/bond, both large index funds. ...
by dbr
Thu Oct 02, 2014 9:18 am
 
Forum: Investing - Theory, News & General
Topic: Buffett vs. Bogleheads
Replies: 25
Views: 1640

Re: When/how to rebalance?

The Wiki is good, but I have always found the terminology unnecessarily confusing. What people here call "absolute percentage" is a term I've never encountered anywhere else and I find intuitively opaque. In the common illustrations it isn't even denominated as percentage, but rather perc...
by dbr
Thu Oct 02, 2014 8:57 am
 
Forum: Investing - Help with Personal Investments
Topic: When/how to rebalance?
Replies: 8
Views: 395

Re: Is my husband a spendthrift? Or I a tightwad?

Figure out how much is "enough" to save to reach your goals. You guys do agree on goals, right? Then spend the rest on whatever makes you happy. As I skimmed this thread the idea that kept coming back was the principle of "pay yourself first." That means take out what you need t...
by dbr
Wed Oct 01, 2014 5:55 pm
 
Forum: Personal Finance (Not Investing)
Topic: Is my husband a spendthrift? Or I a tightwad?
Replies: 116
Views: 6884

Re: Company stock match, good deal?

Again stock purchase plans usually have a short vesting period, perhaps a year, after which the stock can be sold. Back in the good old days at Megacorp the discount was 15% on 10% of your salary and you could sell the same day as purchased at zero transaction cost. Basically that amounts to a 1.5%...
by dbr
Wed Oct 01, 2014 4:02 pm
 
Forum: Investing - Help with Personal Investments
Topic: Company stock match, good deal?
Replies: 11
Views: 328

Re: rebalancing conundrum/paradox/irony

Person 1 has $90k of stocks and $10k of bonds Person 2 has $300k of stocks and $200k of bonds Who is taking on more risk? Conundrum: Person 2 is Person 1 five years on. .... The understood answer to your question, of course, is that a higher proportion of stocks is more risky than a lower proportio...
by dbr
Wed Oct 01, 2014 3:41 pm
 
Forum: Investing - Theory, News & General
Topic: rebalancing conundrum/paradox/irony
Replies: 83
Views: 4671

Re: Company stock match, good deal?

Again stock purchase plans usually have a short vesting period, perhaps a year, after which the stock can be sold. Back in the good old days at Megacorp the discount was 15% on 10% of your salary and you could sell the same day as purchased at zero transaction cost. Basically that amounts to a 1.5% ...
by dbr
Wed Oct 01, 2014 3:36 pm
 
Forum: Investing - Help with Personal Investments
Topic: Company stock match, good deal?
Replies: 11
Views: 328

Re: Fidelity Offers A Round-Trip to Europe for New Account

One can read (currently) 1995 posts on this topic here: http://www.flyertalk.com/forum/milesbuzz/1339055-fidelity-bonus-offers-airline-miles-hotel-points-only.html Note the offers are for Delta, United, and AA. Other discussion about what those miles are worth and how to use them effectively can be ...
by dbr
Wed Oct 01, 2014 2:46 pm
 
Forum: Personal Finance (Not Investing)
Topic: Fidelity Offers A Round-Trip to Europe for New Account
Replies: 9
Views: 1048

Re: 401 K Question

The degree of creditor protection for IRAs varies from state to state, so protection from your creditors depends on where you are. Indeed, and it also depends on whether one is talking about bankruptcy cases or non-bankruptcy liabilities. It is mostly the latter where the differences might matter a...
by dbr
Wed Oct 01, 2014 2:29 pm
 
Forum: Investing - Help with Personal Investments
Topic: 401 K Question
Replies: 11
Views: 469

Re: Company stock match, good deal?

She should be able to diversify the company stock match either immediately or after a short vesting period. Ask for details of her plan terms and conditions. I don't think you have all the information yet.

I would not bother to invest in a company stock purchase plan at 5% discount.
by dbr
Wed Oct 01, 2014 2:25 pm
 
Forum: Investing - Help with Personal Investments
Topic: Company stock match, good deal?
Replies: 11
Views: 328

Re: rebalancing conundrum/paradox/irony

This seems very counterintuitive to me... It's not counterintuitive if you recognize that rebalancing is about maintaining the risk and return target of a portfolio as a whole (defined by asset allocation in reference to constant long term expected risk and return) and is not about some kind of aut...
by dbr
Wed Oct 01, 2014 2:22 pm
 
Forum: Investing - Theory, News & General
Topic: rebalancing conundrum/paradox/irony
Replies: 83
Views: 4671

Re: need for a backup credit card?

Travelling overseas on only one card is flirting with disaster. We travel with at least three meaning one of mine, one of hers, and one each coming from a joint account.

Also I am an advocate of spouses each having at least one credit card account entirely in their own name.
by dbr
Wed Oct 01, 2014 9:53 am
 
Forum: Personal Finance (Not Investing)
Topic: need for a backup credit card?
Replies: 37
Views: 1531

Re: rebalancing conundrum/paradox/irony

This seems very counterintuitive to me... It's not counterintuitive if you recognize that rebalancing is about maintaining the risk and return target of a portfolio as a whole (defined by asset allocation in reference to constant long term expected risk and return) and is not about some kind of aut...
by dbr
Wed Oct 01, 2014 9:48 am
 
Forum: Investing - Theory, News & General
Topic: rebalancing conundrum/paradox/irony
Replies: 83
Views: 4671

Re: Why not 100% CD's?

The risk of being in 100% CDs with a current real return of 0% is if unexpected inflation shows up your purchasing power will be crushed. Thanks John. But let me ask you this, if inflation became an issue, wouldn't CD rates be rising as well. Stocks are no guarantee against inflation. Rising rates ...
by dbr
Fri Sep 26, 2014 12:07 pm
 
Forum: Investing - Help with Personal Investments
Topic: Why not 100% CD's?
Replies: 73
Views: 4972

Re: ISOs, AMT, Taxes...Oh My!

There is a book that may be helpful, called "Consider Your Options: Get the Most from Your Equity Compensation." It covers lots of details about situations like this. It's well worth the cost, in my opinion. Turbotax should be able to handle this - it was able to handle it when I exercise...
by dbr
Fri Sep 26, 2014 11:56 am
 
Forum: Investing - Help with Personal Investments
Topic: ISOs, AMT, Taxes...Oh My!
Replies: 6
Views: 438

Re: Why not 100% CD's?

If you've already got enough money, sure. Though to guarantee you keep up with unexpected inflation (as another poster mentioned) you might want inflation protected securities. If I was in retirement and had enough money I'd be 100% in I-bonds and individual TIPS. To me that would be an even lower ...
by dbr
Fri Sep 26, 2014 10:54 am
 
Forum: Investing - Help with Personal Investments
Topic: Why not 100% CD's?
Replies: 73
Views: 4972

Re: Stubbornly Non-Boglehead Husband. What To Do?

I think they are so rich, and live cheaply enough that it just doesn't matter how much he loses. Therefore, their differences with how they handle money shouldn't really affect their relationship. Maybe so. The essence of her issue is in this sentence from the OP: "It kills me to see him makin...
by dbr
Fri Sep 26, 2014 10:53 am
 
Forum: Investing - Theory, News & General
Topic: Stubbornly Non-Boglehead Husband. What To Do?
Replies: 122
Views: 7549

Re: Why not 100% CD's?

If you have enough money to support your retirement at that return in the face of possible inflation you could put everything in CD's. A concern would be to distribute the holdings accross enough banks to keep full FDIC coverage. There aren't very many people who are so intolerant of volatility yet ...
by dbr
Fri Sep 26, 2014 10:43 am
 
Forum: Investing - Help with Personal Investments
Topic: Why not 100% CD's?
Replies: 73
Views: 4972

Re: ISOs, AMT, Taxes...Oh My!

You can get back the full AMT on an ISO exercise using the AMT credit on this form: http://www.irs.gov/uac/Form-8801,-Credit-for-Prior-Year-Minimum-Tax%E2%80%94Individuals,-Estates,-and-Trusts Also see: http://www.amtadvisor.com/Minimum_Tax_Credit.html However, I agree that in case of doubt or confu...
by dbr
Fri Sep 26, 2014 10:38 am
 
Forum: Investing - Help with Personal Investments
Topic: ISOs, AMT, Taxes...Oh My!
Replies: 6
Views: 438

Re: ISOs, AMT, Taxes...Oh My!

You should look up the rules for AMT credit:

http://www.fairmark.com/amt/credit.htm
by dbr
Fri Sep 26, 2014 10:26 am
 
Forum: Investing - Help with Personal Investments
Topic: ISOs, AMT, Taxes...Oh My!
Replies: 6
Views: 438

Re: Stubbornly Non-Boglehead Husband. What To Do?

What would be the situation if the husband has to declare personal bankruptcy?
by dbr
Thu Sep 25, 2014 5:28 pm
 
Forum: Investing - Theory, News & General
Topic: Stubbornly Non-Boglehead Husband. What To Do?
Replies: 122
Views: 7549

Re: Question about medicare, myself, and spouse

Are you still employed and do you currently have health insurance through that employer (you and/or spouse)? If so, it might depend upon what their terms are about what to do when one reaches 65. RM Yes, the first question is whether or not you will still be employed after your reach 65. If so, you...
by dbr
Thu Sep 25, 2014 1:57 pm
 
Forum: Personal Consumer Issues
Topic: Question about medicare, myself, and spouse
Replies: 9
Views: 693

Re: Advice for student buying cheap used car

Depending on the situation not owning a car at all might be an option. One cringes at the idea of putting a young person in a beater that will be a money pit and unreliable, prone to leaving one stranded at awkward times, and not safe. Just keeping up good tires and brakes, new battery and so on can...
by dbr
Thu Sep 25, 2014 10:28 am
 
Forum: Personal Consumer Issues
Topic: Advice for student buying cheap used car
Replies: 54
Views: 3137

Re: Lump sum or monthly check at retirment

Oh, and I don't know how the $35k would be taxed, so that might affect the sum that actually gets invested which would likely lower the monthly payout in retirement. Also, I believe SWRs are adjusted for inflation. Is the pension distribution? Someone can let us know if this kind of payout cannot g...
by dbr
Thu Sep 25, 2014 10:05 am
 
Forum: Personal Finance (Not Investing)
Topic: Lump sum or monthly check at retirement
Replies: 20
Views: 1287

Re: rental income

In general buying rental property as an investment can make sense. There is much more to it than "rental income." I would suggest you read up on the subject, talk to others who are doing this, and read replies you will get here. I would suggest not attempting such a thing until you underst...
by dbr
Thu Sep 25, 2014 9:58 am
 
Forum: Investing - Help with Personal Investments
Topic: rental income
Replies: 2
Views: 364

Re: Calculating Rolling Returns

The return for a period is usually defined to be the compound annual growth rate, which see here: http://en.wikipedia.org/wiki/Compound_annual_growth_rate The tricky part is finding out what the final value of an investment would be with dividends reinvested. To do that you would have to access the ...
by dbr
Wed Sep 24, 2014 5:51 pm
 
Forum: Investing - Theory, News & General
Topic: Calculating Rolling Returns
Replies: 14
Views: 840

Re: No Vanguard in our 401k

I've been speaking with my CFO about our 401k and the available funds. We currently use Oppenheimer funds but are switching to a new provider. I expressed to him the benefit of using Vanguard funds and this is the reply he received regarding Vanguard: As far as Vanguard funds go, PAI has a list of ...
by dbr
Wed Sep 24, 2014 5:00 pm
 
Forum: Investing - Help with Personal Investments
Topic: No Vanguard in our 401k
Replies: 10
Views: 934

Re: What should one pay for a student cello?

For student musicians talking around to other families, music schools, especially Suzuki, and to instrument shops and music stores can result in finding used instruments that can be sold on in return. You may get a better instrument for the money or at least be in the loop for recovering the cost. W...
by dbr
Wed Sep 24, 2014 2:09 pm
 
Forum: Personal Consumer Issues
Topic: What should one pay for a student cello?
Replies: 10
Views: 693

Re: My IPS and rebalancing

When the market crashes a lot is when "it hasn't happened yet" does happen. At that point you sell some bonds and buy some stocks. As an exercise for the reader one should compute how much buying and selling that is for any given % decline in the market. It might be surprising how much mov...
by dbr
Wed Sep 24, 2014 10:43 am
 
Forum: Investing - Help with Personal Investments
Topic: My IPS and rebalancing
Replies: 12
Views: 1067

Re: What's your one big takeaway from the Crash of 2008?

My takeaway is that the rapid recovery and subsequent course of the market could deceive people on two counts: 1. That market crashes are harmless because rapid recovery follows. This is a very dangerous idea. 2. That holding stocks is really risky because the market can crash. This is also a danger...
by dbr
Wed Sep 24, 2014 10:33 am
 
Forum: Investing - Theory, News & General
Topic: What's your one big takeaway from the Crash of 2008?
Replies: 310
Views: 45072

Re: I've made it (almost)

I think you have the symptoms of not having things to do in retirement that you can look forward to. Life should be lived by what pulls you forward rather than by what keeps you where you are. How about it? To answer the question about why to keep working, I might have gone sooner but I waited to se...
by dbr
Wed Sep 24, 2014 10:27 am
 
Forum: Investing - Help with Personal Investments
Topic: I've made it (almost)
Replies: 9
Views: 2141

Re: Is having 100% large cap not diverse enough?

a) Their approach is legitimate. Their fee is something to be avoided even if going that way because other advisors with access to DFA funds charge 0.4% and below. b) I provided a link to Trev H's thread which answers this question. Please attend very carefully to the comments above in using the wo...
by dbr
Wed Sep 24, 2014 10:18 am
 
Forum: Investing - Help with Personal Investments
Topic: Is having 100% large cap not diverse enough?
Replies: 49
Views: 2843

Re: Mango Money as Fixed Income

Oh no I agree that it's an asset. But when I wrote my IPS, I assumed that fixed income assets would have compounding returns. Maybe that's my problem? From the point of view of asset allocation "fixed income" serves the purpose of diluting the volatility of the overall portfolio because m...
by dbr
Wed Sep 24, 2014 10:09 am
 
Forum: Investing - Help with Personal Investments
Topic: Mango Money as Fixed Income
Replies: 5
Views: 651

Re: Mango Money as Fixed Income

The non-compounding of interest can be ignored. How does that cause the savings involved to not be an asset? However, it doesn't seem to make any sense that your bond allocation depends one way or another on $5000 either way. If it does then probably you are young and don't have a lot in assets yet....
by dbr
Wed Sep 24, 2014 9:30 am
 
Forum: Investing - Help with Personal Investments
Topic: Mango Money as Fixed Income
Replies: 5
Views: 651

Re: Stubbornly Non-Boglehead Husband. What To Do?

I'm not sure there is a problem either. In any case the solutions range from be happy with what you have, which apparently is a lot, to escaping from the situation by divorce. In any case be sure you know what you want because you can end up getting what you ask for. One obvious possibility is joint...
by dbr
Wed Sep 24, 2014 9:21 am
 
Forum: Investing - Theory, News & General
Topic: Stubbornly Non-Boglehead Husband. What To Do?
Replies: 122
Views: 7549

Re: Sale of a home between boyfriend and girlfriend.

cheese_breath wrote:Now that she's decided what she's going to do I'd be interested in knowing how he reacts to it.


Indeed. Fair isn't about what she decides but about what THEY agree to.
by dbr
Wed Sep 24, 2014 9:07 am
 
Forum: Personal Finance (Not Investing)
Topic: Sale of a home between boyfriend and girlfriend.
Replies: 79
Views: 5550

Re: 3 Fund Portfolio Vs. Vanguard Advisor Recommendations

So many different answers! I'm not sure there is such a thing as a Boglehead! :oops: But I do get the big picture, that by taking 90% of the expense out of management of my portfolio and by moving from actively managed to largely indexed funds I can probably add myself to the legions of "Bogle...
by dbr
Wed Sep 24, 2014 9:06 am
 
Forum: Investing - Help with Personal Investments
Topic: 3 Fund Portfolio Vs. Vanguard Advisor Recommendations
Replies: 15
Views: 1644

Re: Risk and the Trinity Study

The Trinity Study may have weighed all market conditions based on history, but it only looked at 70 years of history for one country. I wonder what the results would look like for the 1926-1995 period for Germany, Italy or Japan? I know, I know the U.S. Is different , but....... Among other things,...
by dbr
Tue Sep 23, 2014 9:51 pm
 
Forum: Investing - Theory, News & General
Topic: Risk and the Trinity Study
Replies: 33
Views: 1774

Re: 3 Fund Portfolio Vs. Vanguard Advisor Recommendations

- Total bond market 47% - Intermediate-term investment-grade bond fund 21% - Total international bond market 18% - Short-term investment grade bond fund 14% His guidance to me is that that Vanguard's Total Bond Market Index Funds aren't really representative of the total bond market, being longer-t...
by dbr
Tue Sep 23, 2014 7:00 pm
 
Forum: Investing - Help with Personal Investments
Topic: 3 Fund Portfolio Vs. Vanguard Advisor Recommendations
Replies: 15
Views: 1644

Re: Risk and the Trinity Study

If the Trinity Study is correct, then 100/0 or 75/25 stocks/bonds is best or ties for best in all 30-year scenarios: http://www.bogleheads.org/wiki/File:TrinityTable3.jpg This means that a lower stock allocation is either riskier or has the same risk. So, why do we think of lower stock allocations ...
by dbr
Tue Sep 23, 2014 2:46 pm
 
Forum: Investing - Theory, News & General
Topic: Risk and the Trinity Study
Replies: 33
Views: 1774

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

Your costs are about double ours, also in a large metropolitan area, including any household and personal products bought at a grocery store. But then ours includes this: http://www.malts.com/index.php/Our-Whiskies/Lagavulin and this: http://www.scapamalt.com/Home.aspx but not in massive quantities.
by dbr
Tue Sep 23, 2014 1:48 pm
 
Forum: Personal Consumer Issues
Topic: We have a grocery problem... [Household budget]
Replies: 158
Views: 10631

Re: Blocking Your Own Name & Home Phone Number?

FTC reports that spam calls are now initiated with Caller ID of your own name and telephone number. This is a new scam. My phone has blocking capability and I am wondering it is OK to block my own telephone number? Has anyone blocked their own telephone number? Maybe I'm missing something, but if y...
by dbr
Mon Sep 22, 2014 1:07 pm
 
Forum: Personal Consumer Issues
Topic: Blocking Your Own Name & Home Phone Number?
Replies: 16
Views: 1300

Re: Blocking Your Own Name & Home Phone Number?

How is that a scam? I now know for sure that the call is from "Rachel" and either not answer or pick up and replace the receiver. It is not possible to place a call from a number to the same number, as far as I know, and who would it be anyway if I know I am not calling anyone? Ironically ...
by dbr
Mon Sep 22, 2014 9:31 am
 
Forum: Personal Consumer Issues
Topic: Blocking Your Own Name & Home Phone Number?
Replies: 16
Views: 1300

Re: Trusting our advisor?

I think a better perception of the cost is to realize that of a $40,000/year income a person could raise from $1M invested, the fee takes 25%. Who wants to give a quarter of their income every year to a money manager?
by dbr
Sun Sep 21, 2014 10:07 pm
 
Forum: Investing - Help with Personal Investments
Topic: Trusting our advisor?
Replies: 25
Views: 1884

Re: Trusting our advisor?

OK, so I am not a Diehard. Big Deal. Agreeing with every specific asset allocation statement that Mr. Bogle can be found to have made is hardly a requirement for being a Boglehead. Of course, livesoft is not a diehard, obviously. As far as the OP, in addition to confounding stock and bond internati...
by dbr
Sun Sep 21, 2014 11:19 am
 
Forum: Investing - Help with Personal Investments
Topic: Trusting our advisor?
Replies: 25
Views: 1884

Re: Trusting our advisor?

I don't think lumping stock international and bond international is a good figure. The comments about 20%-40% have been for stocks. Those discussions have never included a statement about allocation to international bonds. I personally have no familiarity with international bond investing. Putting 7...
by dbr
Sun Sep 21, 2014 9:52 am
 
Forum: Investing - Help with Personal Investments
Topic: Trusting our advisor?
Replies: 25
Views: 1884

Re: Critique my thoughts on Real Estate Investing

Please critique my reasoning. I would suggest with all due respect that if your don't know enough about real estate investing to answer questions such as yours rather than ask them, that you shouldn't be doing this, at least not with 30% of your portfolio and multiple properties right off the bat. ...
by dbr
Sun Sep 21, 2014 9:44 am
 
Forum: Investing - Help with Personal Investments
Topic: Critique my thoughts on Real Estate Investing
Replies: 17
Views: 1126

Re: Sale of a home between boyfriend and girlfriend.

The profit should be split in proportion to the contribution made whether down payment, PMI, maintenance or whatever. I don't think taxes should come into it. If the mother actually paid for the roof, she is due a share for that.
by dbr
Sat Sep 20, 2014 10:59 am
 
Forum: Personal Finance (Not Investing)
Topic: Sale of a home between boyfriend and girlfriend.
Replies: 79
Views: 5550

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

You can look at the tables in the original Trinity Study where results are presented for 15, 20, 25, and 30 years: https://www.aaii.com/journal/article/retirement-savings-choosing-a-withdrawal-rate-that-is-sustainable I would say Trinity is probably the "benchmark," and one can refer to ot...
by dbr
Sat Sep 20, 2014 10:06 am
 
Forum: Investing - Help with Personal Investments
Topic: So what the benckmark SWR for a 25 year retirement?
Replies: 14
Views: 958
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