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Re: heartbleed - widespread internet security problem

Maybe it's time VG offered two-factor auth? And every other bank/broker site...
by dmcmahon
Thu Apr 10, 2014 12:48 am
 
Forum: Personal Consumer Issues
Topic: heartbleed - widespread internet security problem
Replies: 175
Views: 16474

Microbusiness and TurboTax

A family member runs a business as a sideline, and makes a small amount of income ($100s / year) from it. Think selling items on ebay although this is not exactly what she's doing. Problem is, she has expenses that exceed the amount she makes in tax year 2013. Now, as far as I can tell, if she repor...
by dmcmahon
Tue Apr 08, 2014 5:49 pm
 
Forum: Personal Finance (Not Investing)
Topic: Microbusiness and TurboTax
Replies: 1
Views: 104

Re: What is your 2013 Federal Effective Tax Rate?

Only way to determine effective tax rate is total tax paid divided by total income from all sources including w-2 income before tax deferred retirement contributions and health insurance premiums plus non taxable income not reported on 1040, e.g., roth IRA distributions and muni bonds. If working i...
by dmcmahon
Sat Mar 15, 2014 4:29 pm
 
Forum: Personal Finance (Not Investing)
Topic: What is your 2013 Federal Effective Tax Rate?
Replies: 73
Views: 4723

Re: What If Long-Term Thinking Really Catches On?

Facebook could never have had an IPO, because nobody would have been able to buy it, since it wasn't in any index. :) Au contraire, it's rapid inclusion in many indexes forces passive indexers who wouldn't normally buy a stock at rich valuations to own it. What if the VC community could fob off alm...
by dmcmahon
Wed Mar 12, 2014 1:09 am
 
Forum: Investing - Theory, News & General
Topic: What If Long-Term Thinking Really Catches On?
Replies: 21
Views: 2023

Re: Tax deduction larger than AGI. What to do?

I'm surprised you didn't get hammered with AMT. By any chance did you accelerate income into 2012 to avoid 2013 tax increases, after which your income for 2013 fell off a cliff whilst a big retroactive prop 30 tax bill hit you in calendar 2013?
by dmcmahon
Fri Mar 07, 2014 1:01 pm
 
Forum: Personal Finance (Not Investing)
Topic: Tax deduction larger than AGI. What to do?
Replies: 7
Views: 644

Re: Schwarzman Loves Dividends!

leesbro Yes all that is true. But so does buybacks and paying down debt--they have same positive impact of reducing agency risk And if dividends actually made a company safer, for reasons you cite--would you not think that was in the price? You pay a price for safety. But it turns out that stocks t...
by dmcmahon
Fri Mar 07, 2014 12:31 pm
 
Forum: Investing - Theory, News & General
Topic: Schwarzman Loves Dividends!
Replies: 34
Views: 2134

Re: Tax Exempt Bonds - Risks Involved

If I really wanted to bump up the safety of bonds in that portfolio, I'd switch from TBM to just Treasuries in taxable. This is what I've done. Limits on tax-deferred contributions over my working lifetime have left me with a high proportion of my savings in taxable, so inevitably some bonds need t...
by dmcmahon
Thu Mar 06, 2014 11:46 am
 
Forum: Investing - Theory, News & General
Topic: Tax Exempt Bonds - Risks Involved
Replies: 76
Views: 3613

Re: Investing in real estate

My quick reaction is that it would be too large a proportion of you assets at this point. Houses are illiquid investments. A single family house won't have the cap rate of a multi-family structure. Finally, you'll have to think of it as more of a side business (requiring your time and energy) than a...
by dmcmahon
Tue Mar 04, 2014 10:13 pm
 
Forum: Investing - Theory, News & General
Topic: Investing in real estate
Replies: 23
Views: 1244

Re: Filing paper stubs with by-mail tax return - why?

I have never mailed in torn off stubs from my paycheck. For quite a while my "paycheck" has been an electronic deposit into my checking account. There is no check, there is no stub, there is nothing to tear off. I don't think your question is really about tearing stubs off paychecks. Can ...
by dmcmahon
Sun Feb 23, 2014 1:08 pm
 
Forum: Personal Finance (Not Investing)
Topic: Filing paper stubs with by-mail tax return - why?
Replies: 4
Views: 414

Filing paper stubs with by-mail tax return - why?

Does anyone know why, out of the bazillion tax-related documents we get, the IRS and state require you to send in tear-off stubs from your W2? And why this also includes pension payments from the OPM?
by dmcmahon
Sun Feb 23, 2014 12:07 pm
 
Forum: Personal Finance (Not Investing)
Topic: Filing paper stubs with by-mail tax return - why?
Replies: 4
Views: 414

Re: To MBA or not MBA?

Adding to the other posts, one question I have is whether you'd get the full benefit of the degree without classroom interaction with professors and students? And the related question, how would prospective employers view the on-line version of a degree even from a prestigious school?
by dmcmahon
Thu Feb 20, 2014 10:17 pm
 
Forum: Personal Finance (Not Investing)
Topic: To MBA or not MBA?
Replies: 57
Views: 4521

Re: ACA investment income surtax - where is it reported?

Ah, thanks, that explains why I couldn't find the form!
by dmcmahon
Tue Feb 18, 2014 12:59 pm
 
Forum: Personal Finance (Not Investing)
Topic: ACA investment income surtax - where is it reported?
Replies: 11
Views: 554

ACA investment income surtax - where is it reported?

I do my taxes using TurboTax, and I'm trying to see whether and how it's accounted for the 3.8% ACA surtax this year, which (I think) I'm subject to. But I can't see where that would be calculated, even flipping to forms mode. Anyone know where to look for it? Is there, for instance, some IRS form t...
by dmcmahon
Tue Feb 18, 2014 11:33 am
 
Forum: Personal Finance (Not Investing)
Topic: ACA investment income surtax - where is it reported?
Replies: 11
Views: 554

Re: If tax rates have gone way up for you -

I've discovered another way dividends bite you in California. Cali taxes them as ordinary income, so they have the effect of amplifying your AMT.
by dmcmahon
Tue Feb 18, 2014 2:24 am
 
Forum: Investing - Theory, News & General
Topic: If tax rates have gone way up for you -
Replies: 17
Views: 1760

Re: If tax rates have gone way up for you -

watty; thanks for the math, and I was wondering if I was worrying about it too much. Since I don't have much tax advantaged space but want to tilt to small value, perhaps I just need to accept the added tax. I do not reinvest my dividends but if you want a value tilt the issue still remains. The id...
by dmcmahon
Sun Feb 16, 2014 10:42 pm
 
Forum: Investing - Theory, News & General
Topic: If tax rates have gone way up for you -
Replies: 17
Views: 1760

Re: Will the Super Bowl Theory Hold Up This Time?

ofcmetz wrote:NFC definitely, the market will be up today. :D My condolences to Payton Manning and the death of the AFC.


I dunno, that wasn't a game so much as a train wreck, and that's what we've got today in the markets... :twisted:
by dmcmahon
Mon Feb 03, 2014 12:03 pm
 
Forum: Investing - Theory, News & General
Topic: Will the Super Bowl Theory Hold Up This Time?
Replies: 19
Views: 2919

Re: Bought in, and then they start tumbling

Hi, I seem to have a bad timing when it comes to making contributions to my portfolio. I only contribute quarterly. Last time I did so in bonds, it was just before bonds started to fall. Recently when I did so in stocks, it was just before the recent plunge. Although I know I am holding for the lon...
by dmcmahon
Mon Jan 27, 2014 5:39 pm
 
Forum: Investing - Theory, News & General
Topic: Bought in, and then they start tumbling
Replies: 51
Views: 6472

Re: Bogleheads 2014 Hedge fund contest

Looks like my choices are the kiss of death again with AAPL getting clobbered today and TSLA up for the year so far.
by dmcmahon
Mon Jan 27, 2014 5:38 pm
 
Forum: Investing - Theory, News & General
Topic: Bogleheads 2014 Hedge fund contest
Replies: 132
Views: 8757

Re: New 10year TIP January 2014

Well, when I click to place the order, I get a "Trade Message" that says, "the cusip entered has a short period of time before maturity and the quantity entered would result in a negative yield for this cusip. Please select Back from your browser's toolbar to use a different CUSIP or...
by dmcmahon
Sat Jan 18, 2014 6:23 pm
 
Forum: Investing - Theory, News & General
Topic: New 10year TIP January 2014
Replies: 20
Views: 1656

Re: technology's impact

Every time I have to call a plumber or washing machine repair man or take my car to the shop or clean my bathrooms I'm reminded that work as we know it isn't going to disappear any time soon.
by dmcmahon
Sat Jan 18, 2014 6:17 pm
 
Forum: Investing - Theory, News & General
Topic: technology's impact
Replies: 18
Views: 938

Re: total stock vs sp500 and extended market?

jwillis77373 wrote:Wow Nisiprius.

That history lesson was worth its weight in gold.

I had been asking those questions myself for quite some time.

+1
by dmcmahon
Sat Jan 11, 2014 1:02 am
 
Forum: Investing - Theory, News & General
Topic: total stock vs sp500 and extended market?
Replies: 17
Views: 1663

Re: when you reach"your number"

In theory I'm already there. Problem is I see a lot of uncertainties w.r.t. inflation, prospective returns on financial assets, the health care system, and social security. So it's more of a smear than a specific point. I do like my job and my company. Hi Ho, Hi Ho, it's off to work I go.
by dmcmahon
Thu Jan 09, 2014 1:37 pm
 
Forum: Investing - Theory, News & General
Topic: when you reach"your number"
Replies: 84
Views: 8906

Re: Net Worth Survey, 2014 Edition

And you have to use an appropriate discount rate. I'm suspicious of the SS PV numbers, they look awful low. Since it's as secure as the us gov and it's inflation protected, IMO the yield on 30-year TIPS should be used to discount the flows (i.e. the PV is the value of TIPS bonds you'd have to own i...
by dmcmahon
Mon Jan 06, 2014 8:26 pm
 
Forum: Investing - Theory, News & General
Topic: Net Worth Survey, 2014 Edition
Replies: 149
Views: 18663

Re: Net Worth Survey, 2014 Edition

Calculating PV of pension is also part of the data quality problem. To calculate the PV of pension you have to make an assumption on life expectancy, retirement age/years of service, income at retirement, and inflation. And you have to use an appropriate discount rate. I'm suspicious of the SS PV n...
by dmcmahon
Sun Jan 05, 2014 7:50 pm
 
Forum: Investing - Theory, News & General
Topic: Net Worth Survey, 2014 Edition
Replies: 149
Views: 18663

Re: Bond Rising Rate Effect - Definitive Study

The synopsis would be: It would seem the % of the rate change to beginning yield is directly proportional to the level of damage to the bond funds. This all gets compounded by inflation... Yes this makes intuitive sense and is the reason I've pulled in the maturities of my bond holdings. At low cou...
by dmcmahon
Sat Jan 04, 2014 7:18 pm
 
Forum: Investing - Theory, News & General
Topic: Bond Rising Rate Effect - Definitive Study
Replies: 28
Views: 1672

Re: Have any of you dollar cost averaged in over 5 years

Well...Um...I did. And I'm glad. I started legging into my AA in 2007, and I was glad I didn't go all in at market highs. 5 years seemed about right - legging in over a few months didn't seem likely to protect me from the kind of effect I was worried about, and as it turns out,it wouldn't have. Yes ...
by dmcmahon
Sat Jan 04, 2014 2:12 am
 
Forum: Personal Finance (Not Investing)
Topic: Have any of you dollar cost averaged in over 5 years
Replies: 38
Views: 2352

Re: Is there a theoretical limit to the size of the stock ma

Note that a great amount of business and other economic activity is privately owned and not capitalized in the market. There's room to expand the absolute size of the market by capitalizing more business. For example, large partnerships could go public, as Goldman did many years ago. Or a public bus...
by dmcmahon
Fri Jan 03, 2014 9:47 pm
 
Forum: Investing - Theory, News & General
Topic: Is there a theoretical limit to the size of the stock market
Replies: 13
Views: 1170

Re: Investing in Physical as well as Financial Health

Amen. The hardest thing has been realizing that I have to dial back some of the activities as I get older. I stopped running in favor of low impact gym machines after my younger sister, a long time runner, needed a knee replacement. And now it looks like I'm going to have to curtail weight lifting a...
by dmcmahon
Wed Jan 01, 2014 5:37 pm
 
Forum: Personal Consumer Issues
Topic: Investing in Physical as well as Financial Health
Replies: 39
Views: 2580

Re: Bogleheads 2014 Hedge fund contest

blorman wrote:I just can't resist all this TSLA bait:)

My Lower Intestine & Co

Long:
TSLA - Tesla Motors Inc
DDD - 3D Systems Corporation

Short:
AAPL - Apple Inc
TWTR - Twitter Inc


Twitter isn't in the R3K, is it?
by dmcmahon
Sun Dec 29, 2013 3:10 pm
 
Forum: Investing - Theory, News & General
Topic: Bogleheads 2014 Hedge fund contest
Replies: 132
Views: 8757

Re: Bogleheads 2014 Hedge fund contest

Fund name: Quantitative Teasing

Long: AAPL and WDAY
Short: AMZN and TSLA

(Alas Twitter isn't in the R3000.)
by dmcmahon
Sat Dec 28, 2013 10:05 pm
 
Forum: Investing - Theory, News & General
Topic: Bogleheads 2014 Hedge fund contest
Replies: 132
Views: 8757

Re: Bogleheads 2014 Hedge fund contest

After last year's humiliating performance we're quietly closing our funds and hoping no one remembers our failures when we hang out our new shingle. Anyone know of a searchable on line Russell 3000 database?
by dmcmahon
Fri Dec 27, 2013 6:23 pm
 
Forum: Investing - Theory, News & General
Topic: Bogleheads 2014 Hedge fund contest
Replies: 132
Views: 8757

Re: What you wish you had known entering your late 20's

I'd tell myself "find a wife before it's too late".
by dmcmahon
Thu Dec 26, 2013 8:11 pm
 
Forum: Personal Finance (Not Investing)
Topic: What you wish you had known entering your late 20's
Replies: 100
Views: 9279

Re: Any tips for avoiding large tax bill?

Pay the Cali tax in 2013 so you can deduct it. Pull forward anything deductible from next year, for example pay your full years property tax instead of paying it for 6 months and then paying the next 6 months in early 2014. Consider pulling forward any charitable contributions you'd be making anyway...
by dmcmahon
Thu Dec 26, 2013 5:50 pm
 
Forum: Personal Finance (Not Investing)
Topic: Any tips for avoiding large tax bill?
Replies: 4
Views: 656

Re: 'Play' Money

I've put some money into new ventures but it's less than 1% of my assets and I'm doing it mainly for social reasons rather than thinking they're likely to produce a better risk adjusted payoff than, say the Russell 2000. Ditto some loans to family members - no expectation of making a profit but the ...
by dmcmahon
Thu Dec 26, 2013 5:36 pm
 
Forum: Investing - Theory, News & General
Topic: 'Play' Money
Replies: 95
Views: 6217

Re: Executor of will -- dealing with investment portfolio

pshonore wrote:This is correct. Capital gains tax paid by the estate would represent change in value from date of death to sale, if any

What if the asset is, say, a family home owned by a living trust established by the decedent?
by dmcmahon
Wed Dec 25, 2013 2:02 am
 
Forum: Personal Finance (Not Investing)
Topic: Executor of will -- dealing with investment portfolio
Replies: 119
Views: 3375

Re: Two states, one stock option gain

A related interesting question is what portion of the stock's rise to allocate. Here is a different hypothetical to the OPs: You are granted rights to 400 shares, vesting 100 shares per year. The stock price and exercise price at that time is $10/share. You work one year in state A, vesting 100 shar...
by dmcmahon
Sun Dec 22, 2013 12:28 pm
 
Forum: Personal Finance (Not Investing)
Topic: Two states, one stock option gain
Replies: 5
Views: 339

Re: Two states, one stock option gain

Not sure iRS rules are definitive, as each state may have rules that bear on the question. California is particularly aggressive about claiming a share of the option income for options they view as having been earned in the state. I wouldn't be surprised if state B in your example would expect all o...
by dmcmahon
Sun Dec 22, 2013 12:04 pm
 
Forum: Personal Finance (Not Investing)
Topic: Two states, one stock option gain
Replies: 5
Views: 339

Re: Deferred Compensation Plan

Reading through the Summary of Plan Provisions, I see that if employment is terminated before normal retirement age, account is paid in a single lump sum, regardless of our payment elections. Seems like a deal-breaker IMO. What are the odds that your relatively young wife will leave them before the...
by dmcmahon
Tue Dec 17, 2013 11:45 am
 
Forum: Personal Finance (Not Investing)
Topic: Deferred Compensation Plan
Replies: 27
Views: 1524

Re: Deferred Compensation Plan

Check the details. If you opt for 10 years of quarterly payments there should be no lump sum distribution issue. The date when payments begin may also be flexible, e.g. payments start at age 59.5, or upon retirement if over 60, etc. So hopefully her plan offers very real deferral benefits. The most ...
by dmcmahon
Sun Dec 15, 2013 8:48 pm
 
Forum: Personal Finance (Not Investing)
Topic: Deferred Compensation Plan
Replies: 27
Views: 1524

Re: TSP Survey on Self-Directed Mutual Fund Window

The questions are pretty simple. I won't go into all my answers, but one noteworthy question was: If a mutual fund window interests you, what is the reason? ⋅ To invest in actively-managed funds ⋅ To invest in socially responsible funds ⋅ To invest in real asset funds,...
by dmcmahon
Sat Dec 14, 2013 1:31 am
 
Forum: Investing - Theory, News & General
Topic: TSP Survey on Self-Directed Mutual Fund Window
Replies: 35
Views: 2323

Re: Despite the headline defaults, munis doing okay

Remember Swedroe"s law, it takes an awful lot of interest to make up for unpaid principal. This is a great way to state what I've thought for a long time. At these low yields it just doesn't seem worth taking any risk. As Leif says, you gotta sleep at night. CA's pension issue hasn't gone away...
by dmcmahon
Thu Dec 12, 2013 10:22 pm
 
Forum: Investing - Theory, News & General
Topic: Despite the headline defaults, munis doing okay
Replies: 85
Views: 4000

Re: 2013 TurboTax: Which Product? New Rules?

I always buy the CD version. I want to have access to the software I used to generate my return if it's ever questioned by the IRS. Me too. Plus I don't like having my personal info uploaded to any web site. This wonderful program is well worth it's price to me on CD. I started getting the deluxe v...
by dmcmahon
Thu Dec 05, 2013 11:15 am
 
Forum: Personal Finance (Not Investing)
Topic: 2013 TurboTax: Which Product? New Rules?
Replies: 302
Views: 28925

Denied SS COLA due to gross income?

Got a note from Mom today wherein she says that she won't be getting the 1.5% COLA for 2014 due to her gross income for 2012 being too high. I don't see anything about that on the SS website, but that doesn't seem right to me. Anyone know for sure?
by dmcmahon
Wed Dec 04, 2013 4:28 pm
 
Forum: Personal Finance (Not Investing)
Topic: Denied SS COLA due to gross income?
Replies: 9
Views: 993

Re: The 'Hold Bonds to Maturity' Problem

Some funds may internally sell bonds before maturity, at the short end of their internal ladder. This is a source of cap gains when interest rates are falling, but a source of losses on the way back up. Moreover, funds are more likely to be forced to sell bonds to meet redemptions - investors seeing...
by dmcmahon
Mon Dec 02, 2013 11:03 pm
 
Forum: Investing - Theory, News & General
Topic: The 'Hold Bonds to Maturity' Problem
Replies: 65
Views: 3240

Re: Shiller P/E 10 hits 25

steve_14 wrote:When interest rates decline, what do you do, all else equal? Where do you shift your bond allocation, now that expected returns are lower per unit of risk?


Speaking for myself, I pulled in my average maturity.
by dmcmahon
Sat Nov 30, 2013 10:54 pm
 
Forum: Investing - Theory, News & General
Topic: Shiller P/E 10 hits 25
Replies: 268
Views: 15763

Re: Money Market "Safety"?

My thought is that the risk is probably low but the returns are even lower. I have a savings account paying 0.85%, and I can buy Vanguard funds with it and get the closing price for that day. Why bother with Money Market? Totally agree. Problem is, some accounts have MM's attached as transactional ...
by dmcmahon
Thu Nov 28, 2013 2:15 pm
 
Forum: Investing - Theory, News & General
Topic: Money Market "Safety"?
Replies: 15
Views: 1980

Re: RTM the ninth wonder of the world

First, better "value" if you will is in small value stocks, international stocks and emerging market stocks ... Larry Thanks. Yes, I've shifted what little I can towards international equities. I'm not willing to do this in my taxable accounts yet - valuations would have to be much higher...
by dmcmahon
Tue Nov 26, 2013 8:44 pm
 
Forum: Investing - Theory, News & General
Topic: RTM the ninth wonder of the world
Replies: 15
Views: 1818

Re: RTM the ninth wonder of the world

Larry, thanks for the article. I sympathize with the feeling that expected returns are lower after a big run up in prices. But...where did you see better value? Bonds also seem to be priced for pathetic returns going forward.
by dmcmahon
Tue Nov 26, 2013 6:33 pm
 
Forum: Investing - Theory, News & General
Topic: RTM the ninth wonder of the world
Replies: 15
Views: 1818

Re: 4% stock returns this decade

StarbuxInvestor wrote:I am not sure optimism, enthusiasm or exhilaration has applied to the current bull market. Unease, denial and pessimism have been better fits so far.


Watch more CNBC - for the past week they've been almost giddy. Not even a token bear while I was listening.
by dmcmahon
Tue Nov 26, 2013 2:11 am
 
Forum: Investing - Theory, News & General
Topic: 4% stock returns this decade
Replies: 42
Views: 3696

Re: 4% stock returns this decade

March 24, 2000 the S&P had an intraday high of 1552, on October 11, 2007 it had an intraday high of 1576. Have we really caught up that much from those points or are we focused on where we have come from the index's nearly 13-year low close at 676.53 on March 9, 2009. My observation is while we...
by dmcmahon
Mon Nov 25, 2013 10:51 pm
 
Forum: Investing - Theory, News & General
Topic: 4% stock returns this decade
Replies: 42
Views: 3696
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