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Re: Help please with revised plan for living in retirement

What is your inflation assumption? If many of your fixed expenses are potentially subject to inflation, as they are for most people, then 9 years is a long time to rely on cash and it's hard to be sure that you will definitely have "about $132,000" left unless you are being very conservati...
by freebeer
Fri Aug 15, 2014 1:31 am
 
Forum: Investing - Help with Personal Investments
Topic: Help please with revised plan for living in retirement
Replies: 15
Views: 2757

Re: Principal Residence = Poor Investment?

Here's the easiest way for me to think about it: Option 1) Own a $600,000 house Option 2) Own a $300,000 house and another $300,000 house that you rent out The expenses and appreciation should be about the same but in one case the rental income is $0, the other it's more. It's basically impossible ...
by freebeer
Wed Jul 30, 2014 3:30 pm
 
Forum: Personal Finance (Not Investing)
Topic: Principal Residence = Poor Investment?
Replies: 70
Views: 5302

Re: Help with a new $5m portfolio for an old lady

Update: Mom and I had another run through her math, and it turns out she'd really prefer to draw $180k-200k/yr. (I knew $100k was too low, but I thought it would be closer...) She's now talking more like 3.5%/yr draw ... Does your mother understand that she cannot drawdown 3.5-4% of her portfolio w...
by freebeer
Wed Jul 30, 2014 10:52 am
 
Forum: Investing - Help with Personal Investments
Topic: Help with a new $5m portfolio for an old lady
Replies: 59
Views: 4474

Re: Landlording for long-term wealth? Who's doing it?

biggerpockets.com (forum and blog) is probably something you ought to check out.
by freebeer
Tue Jul 29, 2014 9:51 pm
 
Forum: Personal Finance (Not Investing)
Topic: Landlording for long-term wealth? Who's doing it?
Replies: 68
Views: 7312

Re: Help with a new $5m portfolio for an old lady

You indicate a goal of "preserve principal" which is clearly doable with 2% withdrawal. I would delete "live off the dividends' as the point is total returns sufficient for $100K of spending with principal not shrinking, whether total returns comes from dividends or capital gains is i...
by freebeer
Tue Jul 29, 2014 4:47 pm
 
Forum: Investing - Help with Personal Investments
Topic: Help with a new $5m portfolio for an old lady
Replies: 59
Views: 4474

Re: Old people and financial advisors - a family tale

... the advisor is not necessarily cheating your uncle either. The advisor is just not doing a good job. He may be sincere in his lousy advising. Advisors have to get paid to do their advising. To say this advisor is unethical may be to say every paid advisor is unethical as they all charge fees, a...
by freebeer
Sun Jul 27, 2014 12:08 pm
 
Forum: Investing - Help with Personal Investments
Topic: Old people and financial advisors - a family tale
Replies: 75
Views: 5702

Re: Buying a Home - Town permit records don't match disclosu

I've owned two residences that I discovered, pre purchase, had undergone completely unpermitted remodeling of a more significant nature than the relatively minor work you described (things like adding bathrooms), and in a relatively picky big city, not out in the boonies. YMMV, but I proceeded in bo...
by freebeer
Sun Jul 27, 2014 11:51 am
 
Forum: Personal Finance (Not Investing)
Topic: Buying a Home - Town permit records don't match disclosures
Replies: 57
Views: 3566

Re: Vanguard quietly adds longevity annuities

... Uh-oh. :o :? :( Those inflation adjusted quotes are much too low . I couldn't quite find anything stating this as clearly as it needs to be stated, but it seems obvious that these quotations are literally for just what they say. Payments of a preset number of dollars , $1,000 a month starting i...
by freebeer
Sat Jul 26, 2014 11:14 am
 
Forum: Investing - Theory, News & General
Topic: Vanguard quietly adds longevity annuities
Replies: 85
Views: 6801

Re: Make Income the Outcome

This is just a large-scale example of the problems people have comparing lump sums with steady payments. "A million dollars" just sounds better than "$70,000 a year for life,"... This isn't just about generalized illogical behavioral in comparing fixed sums with steady payments....
by freebeer
Sat Jul 26, 2014 11:00 am
 
Forum: Investing - Theory, News & General
Topic: Make Income the Outcome
Replies: 49
Views: 3922

Re: Make Income the Outcome

In the game of life there is ultimately no winning, as there's only one outcome. And maximizing spending is *a* goal but is not necessarily *the* only or even most important goal. It would be interesting to learn what percentage of folks have significant bequest motives. I suspect there's millions ...
by freebeer
Fri Jul 25, 2014 11:40 pm
 
Forum: Investing - Theory, News & General
Topic: Make Income the Outcome
Replies: 49
Views: 3922

Re: Make Income the Outcome

I think for many Bogleheads this (is) a headscratcher. You say that if I concentrate on getting the largest portfolio I can I'll undermine my ability to generate appropriate levels of income? Huh? I realize this basic proposition of finance is a headscratcher to many investment enthusiasts. That's ...
by freebeer
Fri Jul 25, 2014 12:52 pm
 
Forum: Investing - Theory, News & General
Topic: Make Income the Outcome
Replies: 49
Views: 3922

Re: "Gel" investment strategy around midlife?

...Here is a vague handwaving argument to suggest that investors should "gel" their strategy somewhere around midlife, and not make further changes...' ...Financial data shows typically shows what I'll call "secular episodes" lasting 10-15 years. You can't spot them or predict h...
by freebeer
Thu Jul 24, 2014 3:43 pm
 
Forum: Investing - Theory, News & General
Topic: "Gel" investment strategy around midlife?
Replies: 5
Views: 847

Re: A case against Index Funds in India

I feel about index funds like what Winston Churchill said about democracy - it's the worst system, except for all the others. You can't make a case *against* index funds unless you can make a case *for* individual stock picking or *for* active funds. And it's quite difficult to make these cases (and...
by freebeer
Wed Jul 23, 2014 9:59 am
 
Forum: Investing - Theory, News & General
Topic: A case against Index Funds in India
Replies: 32
Views: 1803

Re: How indexing let these retirees live footloose and fancy

They are also a bit coy about how much they make from their website and books (which they seem to have more than a half dozen of)... OK so it's only a "supplement", not enough to live on, but is it $1K a year (de minimus) or $15K-$20K year (paying more than half their expenses and being a ...
by freebeer
Tue Jul 22, 2014 7:37 pm
 
Forum: Investing - Theory, News & General
Topic: How indexing let these retirees live footloose and fancyfree
Replies: 35
Views: 3913

Re: Options/guidance for a lazy person to be fit

For me, walking/hiking/biking are the cardio base (I have just never managed to be efficient enough to sustain running/jogging and swimming), combined with strength/higher-intensity conditioning workouts at the gym. If you are lazy (I am) try to do walking/biking as part of your normal daily routine...
by freebeer
Fri Jul 18, 2014 11:07 am
 
Forum: Personal Consumer Issues
Topic: Options/guidance for a lazy person to be fit
Replies: 79
Views: 5892

Re: Withdrawal Rate and Net Worth

Do any of you use net worth when calculating your withdrawals. Eg, you are withdrawing 4% of your net worth rather than just your portfolio. After all, let's say your home equity is a big part of your net worth and you are willing/ready to downsize than why not include that total as your real asset...
by freebeer
Thu Jul 17, 2014 7:39 pm
 
Forum: Investing - Theory, News & General
Topic: Withdrawal Rate and Net Worth
Replies: 16
Views: 1824

Re: Wife has no retirement options- is breadwinner

1 - Max your 401k 2 - Max both Roth IRAs 3 - Max any HSA you might have access to 4 - Start piling up funds in tax efficient taxable Vanguard mutual funds (such as the Total Stock Market Index, the Total International Index, and/or the S&P 500 Index). Keep bonds and any REITs in the retirement ...
by freebeer
Thu Jul 17, 2014 2:54 pm
 
Forum: Personal Finance (Not Investing)
Topic: Wife has no retirement options- is breadwinner
Replies: 36
Views: 3362

Re: Ways to lose money and destroy personal wealth by invest

- attempting to hedge "human capital" risk, and more specifically employee stock-option risk, by shorting stock in a peer company of your employer.
- come to think of it, "naked" shorting stock, period.
by freebeer
Thu Jul 17, 2014 12:41 pm
 
Forum: Investing - Theory, News & General
Topic: Ways to lose money and destroy personal wealth by investing
Replies: 81
Views: 9574

Re: Likely about to lose job, planning for transition

...I also went out and bought a third car and got a 0%-loan before I became unemployed.... third car - yikes! with 0% loan implying new car which means many thousands of dollars lost driving off the lot... double yikes!! I would instead be seeking to be considerably more frugal, maybe selling car #...
by freebeer
Thu Jul 17, 2014 11:54 am
 
Forum: Personal Finance (Not Investing)
Topic: Likely about to lose job, planning for transition
Replies: 21
Views: 2674

Re: Withdrawal Rate and Net Worth

Do any of you use net worth when calculating your withdrawals. Eg, you are withdrawing 4% of your net worth rather than just your portfolio. After all, let's say your home equity is a big part of your net worth and you are willing/ready to downsize than why not include that total as your real asset...
by freebeer
Thu Jul 17, 2014 10:05 am
 
Forum: Investing - Theory, News & General
Topic: Withdrawal Rate and Net Worth
Replies: 16
Views: 1824

Re: Minimizing Capital Gain Tax

...daughter who is four years away from college. The funds that we will be using for those expenses will be from two Vanguard taxable accounts. We have a very low basis in both funds so would incur a pretty hefty hit in capital gain tax if we sold shares. Also, my AGI is almost $230,000 and my unde...
by freebeer
Wed Jul 16, 2014 9:37 pm
 
Forum: Investing - Help with Personal Investments
Topic: Minimizing Capital Gain Tax
Replies: 10
Views: 1179

Re: Retiring soon setting aside 3 years living expenses

I think I can try to explain the mind set: Folks who retire before age 59.5 with a little bit in a taxable account do not wish to have to withdraw any money from their IRAs before age 59.5, so they want their taxable account to last until they reach age 59.5. They are afraid that a market crash bef...
by freebeer
Tue Jul 15, 2014 6:51 am
 
Forum: Personal Finance (Not Investing)
Topic: Retiring soon setting aside 3 years living expenses
Replies: 49
Views: 5414

Re: University of British Columbia - Vancouver?

I also have an incoming high school senior and UBC is on his "possible" list and he has sailing teammates who are entering this fall. We've been to Vancouver dozens of times, it's a great place and UBC a good school (albeit depending on major Simon Fraser may have it beat rep-wise locally)...
by freebeer
Mon Jul 14, 2014 7:41 pm
 
Forum: Personal Consumer Issues
Topic: University of British Columbia - Vancouver?
Replies: 31
Views: 1873

Re: Safe withdrawal rate > 4% if no heirs & ok to deplete ca

... Your example conflates the tradeoffs of a) reverse-mortgage vs. selling and getting an SPIA with b) staying in a home vs. downsizing into a modest apartment. ... If it comes across that way I misspoke, but reviewing the text I don't think I did. I intended, at least, to compare them as necessar...
by freebeer
Mon Jul 14, 2014 7:42 am
 
Forum: Investing - Help with Personal Investments
Topic: Safe withdrawal rate > 4% if no heirs & ok to deplete captl?
Replies: 32
Views: 3150

Re: Safe withdrawal rate > 4% if no heirs & ok to deplete ca

...One option... is a periodic payment... I would be very surprised if in most cases selling a home and using the proceeds to buy an inflation-adjusted single premium immediate annuity, then moving into a modest rental apartment, especially a housing-agency space reserved for seniors, wasn't a fina...
by freebeer
Sun Jul 13, 2014 9:47 pm
 
Forum: Investing - Help with Personal Investments
Topic: Safe withdrawal rate > 4% if no heirs & ok to deplete captl?
Replies: 32
Views: 3150

Re: Retiring soon setting aside 3 years living expenses

...It sounds to me like OP has a taxable portfolio from which OP will be making withdrawals and doesn't want to cash in stock funds during a market pullback. I am in a similar position as I expect to retire in 1 -3 years. For me, the issue isn't having enough assets for retirement - it is the fact ...
by freebeer
Sun Jul 13, 2014 4:50 pm
 
Forum: Personal Finance (Not Investing)
Topic: Retiring soon setting aside 3 years living expenses
Replies: 49
Views: 5414

Re: Ditch car and commute to work in 250cc scooter in Raleig

... ... as dangerous as the average car. Motorcycles on the other hand are about 35 times worse ... on a per mile basis. ... The "35 times worse" statistic appears to be about the risk of a fatal crash on motorcycle vs. car from a 2006 study (http://www-nrd.nhtsa.dot.gov/Pubs/810990.PDF)....
by freebeer
Sun Jul 13, 2014 4:29 pm
 
Forum: Personal Consumer Issues
Topic: Ditch car and commute to work in 250cc scooter in Raleigh?
Replies: 79
Views: 6623

Re: Safe withdrawal rate > 4% if no heirs & ok to deplete ca

What is your age(s) and gender(s)? There is no way to assess safety of a decumulatory withdrawal rate without this information... 55 year old female a very different story than 72 year old male (I would swag 3% for the former, 5% for the latter). As others have noted if you don't have a bequest moti...
by freebeer
Sun Jul 13, 2014 3:59 pm
 
Forum: Investing - Help with Personal Investments
Topic: Safe withdrawal rate > 4% if no heirs & ok to deplete captl?
Replies: 32
Views: 3150

Re: Have you quit your job because of your boss?

... My new position probably wouldn't pay as much, at least initially, but my retirement continues as before and I would still retire at my current pay scale (the highest pay) Of course government agencies are under pressure to reform generous pension plans so I would be hesitant before presuming I...
by freebeer
Sun Jul 13, 2014 12:55 pm
 
Forum: Personal Finance (Not Investing)
Topic: Have you quit your job because of your boss?
Replies: 66
Views: 7399

Re: Ditch car and commute to work in 250cc scooter in Raleig

I have a Kymco People S 200, it gets to 70 on level, so I can ride on freeways, and it's affordable both in its miserly gas consumption (I love the expression on the folks filling up their gas guzzlers when I fill up with 1/2 gallon) and purchase priced (used you can get one under $2K). It has motor...
by freebeer
Sun Jul 13, 2014 12:44 pm
 
Forum: Personal Consumer Issues
Topic: Ditch car and commute to work in 250cc scooter in Raleigh?
Replies: 79
Views: 6623

Re: True or False? Your risk tolerance only increases with t

This is situation-dependent so can't be given a blank True or False. If you become truly financially independent - you have more money than you will ever spend, i.e. you are not really "decumulating" in retirement but still adding to your portfolio even with withdrawals - then your risk to...
by freebeer
Fri Jul 11, 2014 9:43 pm
 
Forum: Investing - Theory, News & General
Topic: True or False? Your risk tolerance only increases with time
Replies: 30
Views: 2374

Re: Engineer career change

My goal in life is to maximize my compensation to effort ratio . Haha, been chasing this goal for 30 years. I moved into management about 15 years ago, much more work and stress than individual contributor engineering job, good move avoiding this... I disagree based on my own experience. And, you w...
by freebeer
Fri Jul 11, 2014 12:47 pm
 
Forum: Personal Finance (Not Investing)
Topic: Engineer career change
Replies: 55
Views: 5629

Re: San Juan Islands

I prefer Lopez... much quieter than San Juan or even Orcas but has all services, decent restaurants, and some lovely beaches and hikes. Orcas would be my #2 choice... #1 if you want the hippie vibe (go to Doe Bay and soak in the hot springs). Biking is easier on Lopez though (much flatter). We've b...
by freebeer
Fri Jul 11, 2014 6:16 am
 
Forum: Personal Finance (Not Investing)
Topic: San Juan Islands
Replies: 18
Views: 2237

Re: San Juan Islands

I prefer Lopez... much quieter than San Juan or even Orcas but has all services, decent restaurants, and some lovely beaches and hikes. Orcas would be my #2 choice... #1 if you want the hippie vibe (go to Doe Bay and soak in the hot springs). Biking is easier on Lopez though (much flatter).
by freebeer
Thu Jul 10, 2014 6:52 pm
 
Forum: Personal Finance (Not Investing)
Topic: San Juan Islands
Replies: 18
Views: 2237

Re: How to w/d from taxable until SS/RMD time gets here?

If spending down a taxable account you should not reinvest dividends. Collect the dividends for spending.... Why? It would seem better to reinvest and consider which securities to sell for spending based on total tax situation ... It nay be those (since basis = current value) but you might prefer t...
by freebeer
Tue Jul 08, 2014 8:50 pm
 
Forum: Investing - Help with Personal Investments
Topic: How to w/d from taxable until SS/RMD time gets here?
Replies: 29
Views: 2113

Re: Which house should we buy?

Wow, 4BR 3.5BA and you're a couple without any kids yet. Maybe I'm just being influenced by Mr Money Mustache extremist LBYM financial porn lately but, although clearly you can afford either home, this seems a bit burdensome, if you are interested in achieving early financial independence (which you...
by freebeer
Mon Jul 07, 2014 11:17 am
 
Forum: Personal Finance (Not Investing)
Topic: Which house should we buy?
Replies: 11
Views: 1283

Re: Business structure - Self employed software engineer

I've done LLC taxed as sole proprietorship (pass through). But I am also on the other side, and I presently pay 6 different contractors who are all over the map on their legal structures. I'm small so roll with the punches but if you anticipate business from a few particular MegaCorps (e.g. based on...
by freebeer
Mon Jul 07, 2014 1:49 am
 
Forum: Personal Finance (Not Investing)
Topic: Business structure - Self employed software engineer
Replies: 18
Views: 1999

Re: The Millionaire Next Door: Are You One?

... 1999 vehicle crash test safety compared to any 2015 model--no matter how expensive--is vastly inferior. ... You're actually intentionally putting yourself in a more risky situation by driving an old car. I know they tightened the rules in 2011 but I can't find any specific data about fatalities...
by freebeer
Sat Jul 05, 2014 11:01 pm
 
Forum: Personal Consumer Issues
Topic: The Millionaire Next Door: Are You One?
Replies: 187
Views: 22720

Re: Animal battle Round 7: Raccoon pooping near house

... Trapping the raccoon may not help. There may be more than one ... I was not aware that Baylisascaris transmission was so low. Most of the sites indicate that it was very dangerous. I was planning to clean up the stuff before I let the kids out again... There are almost certainly several using y...
by freebeer
Sat Jul 05, 2014 12:12 pm
 
Forum: Personal Consumer Issues
Topic: Animal battle Round 7: Raccoon pooping near house
Replies: 39
Views: 3323

Re: Animal battle Round 7: Raccoon pooping near house

Because you have raccoons around you don't let your kids play in the back yard? Really?? According to CDC fewer than 25 cases of Baylisascaris disease (transmission of raccoon roundworm to humans) have been documented in the United States... *ever*. There's some evidence that if you keep kids in ult...
by freebeer
Sat Jul 05, 2014 12:06 am
 
Forum: Personal Consumer Issues
Topic: Animal battle Round 7: Raccoon pooping near house
Replies: 39
Views: 3323

Re: Longevity Insurance now allowed in IRA/401k/etc.

All I want to know is whether there is / will be a low-fees way to purchase a longevity insurance policy? Anything that's larded by a big sales commission isn't worth it, but a reasonably actuarially-fair policy would be nice for us both in terms of lowering taxes on RMDs and in terms of the basic c...
by freebeer
Thu Jul 03, 2014 7:36 pm
 
Forum: Personal Finance (Not Investing)
Topic: Longevity Insurance now allowed in IRA/401k/etc.
Replies: 97
Views: 5354

Re: Alpo risk in retirement: Overblown?

.. the Alpo analogy is overblown b/c this group is very intelligent and probably has a very high savings rate with great investing acumen (low cost/broadly diversified index funds)... I would add also that many members of this group have a tendency (perhaps even compulsion) to be over-prepared. To ...
by freebeer
Thu Jul 03, 2014 11:55 am
 
Forum: Investing - Theory, News & General
Topic: Alpo risk in retirement: Overblown?
Replies: 41
Views: 2469

Re: burning 1 lb is how many calories?

If you are trying to lose weight..Either you need to eat less, exercise more, or a combination of both If the OP or anyone else is trying to lose weight, it presumptuous and degrading to say they are gluttonous (eating too much) or lazy (need to exercise more).... Do you have a different suggestion...
by freebeer
Wed Jul 02, 2014 12:10 am
 
Forum: Personal Consumer Issues
Topic: burning 1 lb is how many calories?
Replies: 69
Views: 5730

Re: Advice on redesigning my parents' retirement portfolio

... Their combined adjusted gross income is $82,500. .. My estimate of their retirement income = (fixed income) + (4 percent of savings) = 55,000 + 0.04*(580,000) = $78,000 So that's close to their current income (yeah!). But I think they could definitely improve their portfolio... But remember tha...
by freebeer
Tue Jul 01, 2014 12:36 am
 
Forum: Investing - Help with Personal Investments
Topic: Advice on redesigning my parents' retirement portfolio
Replies: 16
Views: 1112

Re: Hit our number, should we change our asset allocation?

... Personally i bet it would have been painfull to sell at 5 million and then watch the stock go to 15 million. 10 million more bucks can really change your life... Maybe so. But our recent decision to tweak from 60/40 to 50/50 was based on the opposite conclusion. That for us, the marginal utilit...
by freebeer
Mon Jun 30, 2014 9:04 pm
 
Forum: Investing - Help with Personal Investments
Topic: Hit our number, should we change our asset allocation?
Replies: 34
Views: 2782

Re: Washington state retirees?

Once you decide on the area you want to live in, I strongly suggest renting for awhile before buying. It is hard to convey just how bad the traffic here is, and you may find the estimates given for travel time getting to Seattle are way off. Predictions are for a large influx of new residents over ...
by freebeer
Mon Jun 30, 2014 5:47 pm
 
Forum: Personal Consumer Issues
Topic: Washington state retirees?
Replies: 29
Views: 1807

Re: The Millionaire Next Door: Are You One?

Yes I admit to being LBYM status-seeking :sharebeer . Our cars are 2007/2008 and our house has VG fir doors but only painted MDF trim. I do admit to having a bit of lust for our neighbor's house that has VG fir trim but not enough to move :happy .
by freebeer
Mon Jun 30, 2014 2:00 pm
 
Forum: Personal Consumer Issues
Topic: The Millionaire Next Door: Are You One?
Replies: 187
Views: 22720

Re: How to get father on board with index funds

I have had similar conversations with my father (now 82), over the last 10-15 years, using various strategies, intermediaries, and plans, to no avail. This is what I have learned: 1. He has done reasonably well investing in large cap growth oriented stocks since the 1970's... HAS he "done reas...
by freebeer
Mon Jun 30, 2014 12:43 am
 
Forum: Investing - Help with Personal Investments
Topic: How to get father on board with index funds
Replies: 34
Views: 2124

Re: How to get father on board with index funds

I have had similar conversations with my father (now 82), over the last 10-15 years, using various strategies, intermediaries, and plans, to no avail. This is what I have learned: 1. He has done reasonably well investing in large cap growth oriented stocks since the 1970's... HAS he "done reas...
by freebeer
Sun Jun 29, 2014 7:54 pm
 
Forum: Investing - Help with Personal Investments
Topic: How to get father on board with index funds
Replies: 34
Views: 2124
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