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Re: Do I need to see my credit report?

I read pulling my credit report could actually lower the score, and I might be borderline between good and excellent. Pulling your credit report to check it yourself (from http://www.annualcreditreport.com) does not lower your score. The only inquiries that affect your score are applications for cr...
by grabiner
Mon Sep 01, 2014 11:24 pm
 
Forum: Personal Finance (Not Investing)
Topic: Do I need to see my credit report?
Replies: 19
Views: 464

Re: International in Taxable - Advantage?

According to the Wiki, http://www.bogleheads.org/wiki/Principles_of_tax-efficient_fund_placement all other things being equal, if you can put your international allocation in taxable, there is a slight advantage. I get that if you have millions even a slight advantage makes a difference. But if you...
by grabiner
Mon Sep 01, 2014 11:17 pm
 
Forum: Investing - Theory, News & General
Topic: International in Taxable - Advantage?
Replies: 2
Views: 192

Re: Picking Investments for my HSA

If you live in a state which taxes HSAs (AL, CA, or NJ), you should probably use the DFA Inflation Protected Securities Fund, since TIPS are exempt from state tax. And even if you don't live in such a state, you might well use the TIPS fund if you hold TIPS. The expense ratio difference over Vanguar...
by grabiner
Mon Sep 01, 2014 11:12 pm
 
Forum: Investing - Help with Personal Investments
Topic: Picking Investments for my HSA
Replies: 5
Views: 306

Re: Does Fidelity list their returns post or pre expense rat

The SEC requires all returns to be reported after expenses.

One way to check this is to compare the returns for two share classes of the same fund, such as Vanguard's Investor and Admiral shares; the returns will differ by the difference in expense ratio.
by grabiner
Mon Sep 01, 2014 11:05 pm
 
Forum: Investing - Help with Personal Investments
Topic: Does Fidelity list their returns post or pre expense ratios?
Replies: 3
Views: 195

Re: Hello new to the boards [If retirement funds not used up

Hey guys. Quick question. What is the point of investing in a 401k and Roth when it is likely that you will not use up all the money that you saved before dying? If you are going to save the money anyway, you might as well save in tax-advantaged accounts; it will be there if you need it, and if you...
by grabiner
Mon Sep 01, 2014 11:04 pm
 
Forum: Investing - Help with Personal Investments
Topic: Hello new to the boards [If retirement funds not used up?]
Replies: 13
Views: 430

Re: Why invest in bonds?

One more question for grabiner : Is there some age at which you're suddenly going to diversify into bonds or cash? Or, are other factors involved? Thanks. I am not going to suddenly diversify, but I will increase my bond allocation gradually as I approach retirement, probably starting about 10 year...
by grabiner
Mon Sep 01, 2014 11:00 pm
 
Forum: Investing - Theory, News & General
Topic: Why invest in bonds?
Replies: 88
Views: 4465

Re: sell a 7 year old car or keep it?

A wise man told me that the "sweet spot" for optimizing value/cash back, and minimizing future repair costs is to trade cars in at 60k miles, whatever their age. He was a wealthy man who could afford to buy whatever he wanted and did not like to drive cars into the ground and get every po...
by grabiner
Mon Sep 01, 2014 10:58 pm
 
Forum: Personal Finance (Not Investing)
Topic: sell a 7 year old car or keep it?
Replies: 15
Views: 1031

Re: Pay Off Student Loans or Invest?

Paying down a student loan is a risk-free investment. However, since you have the TSP, you have another very good risk-free investment, the G fund. And the G fund is a better investment than a fixed-rate student loan at the same after-tax rate, because the G fund adjusts to current interest rates wi...
by grabiner
Mon Sep 01, 2014 6:39 pm
 
Forum: Personal Finance (Not Investing)
Topic: Pay Off Student Loans or Invest?
Replies: 10
Views: 735

Re: sell a 7 year old car or keep it?

Economically, selling a used car to buy a new car is a costly move. New cars depreciate faster than old cars, and every time you buy a car (new or used), it loses a lot of its value when you drive it off the lot, as the trade-in value is less than the dealer price. Given the low mileage and the qual...
by grabiner
Mon Sep 01, 2014 6:29 pm
 
Forum: Personal Finance (Not Investing)
Topic: sell a 7 year old car or keep it?
Replies: 15
Views: 1031

Re: Why invest in bonds?

I have always been one of the most aggressive investors on the forum. Counting my mortgage as a negative bond, I am 100% stock, and even not counting it, I am 86% stock with the risk of 96% stock at age 46. (I overweight small-caps, value, and emerging markets, so my stocks are more volatile; with ...
by grabiner
Mon Sep 01, 2014 4:40 pm
 
Forum: Investing - Theory, News & General
Topic: Why invest in bonds?
Replies: 88
Views: 4465

Re: VG LT Treasury Bond Fund up

A common practice among Bogleheads is to have a 5/25 tolerance band for rebalancing. If any asset class gets off by more than 5% of your total portfolio, or 25% of its target allocation, this is a significant enough difference to be worth rebalancing. Markets go up and down 2% or 3% all the time, so...
by grabiner
Mon Sep 01, 2014 3:46 pm
 
Forum: Investing - Theory, News & General
Topic: VG LT Treasury Bond Fund up
Replies: 7
Views: 462

Re: Age in Stocks: Should you have a Reverse Glidepath?

Actually, if you take human capital into account, the traditional glidepath has you moving to investments with lower returns when your human capital is depleted. Huh? To make up for the loss of your human capital and its returns, you ought to be moving the other way, to investments with higher retu...
by grabiner
Mon Sep 01, 2014 3:42 pm
 
Forum: Investing - Theory, News & General
Topic: Age in Stocks: Should you have a Reverse Glidepath?
Replies: 21
Views: 1095

Re: Highly Appreciated Stock

And if he is making donations to charity, he can make donations from the appreciated stock rather than cash.
by grabiner
Mon Sep 01, 2014 3:33 pm
 
Forum: Investing - Help with Personal Investments
Topic: Highly Appreciated Stock
Replies: 8
Views: 939

Re: How does the Tax-Managed Balanced achieve tax efficiency

You could easily replicate it with the total stock market index and short/intermediate muni's. The correct equivalent stock fund is Tax-Managed Capital Appreciation. My concern there is rebalancing - do they do something special with the balanced fund to cause lower tax impact than if I did the reb...
by grabiner
Mon Sep 01, 2014 3:32 pm
 
Forum: Investing - Help with Personal Investments
Topic: How does the Tax-Managed Balanced achieve tax efficiency?
Replies: 6
Views: 594

Re: Asset Placement Question

I wouldn't switch at this point. Total International is eligible for the foreign tax credit, so you lose about 7% of the dividend yield for holding it in an IRA. On the other hand, the dividends are only 70% qualified; if you are in a 28% tax bracket, you pay an extra 13% tax on 30% of the dividends...
by grabiner
Mon Sep 01, 2014 3:24 pm
 
Forum: Investing - Help with Personal Investments
Topic: Asset Placement Question
Replies: 4
Views: 219

Re: Why invest in bonds?

It would be helpful if responders to these threads would include their years to/in retirement, perhaps add as part of their signature. :happy We have these threads every few years on which people post age and asset allocation. Typically, the Boglehead average is age-15 in bonds. There are a few out...
by grabiner
Mon Sep 01, 2014 3:19 pm
 
Forum: Investing - Theory, News & General
Topic: Why invest in bonds?
Replies: 88
Views: 4465

Re: Buying a house, sell REITs?

Do you have any IBonds from the earlier years when they yielded 3%? If you do, you probably want to keep those until maturity, not because of taxes, but because they are earning so much more than the market rate that they are move valuable than tax-deferred space. But by all means, sell your stocks ...
by grabiner
Sun Aug 31, 2014 11:12 pm
 
Forum: Investing - Help with Personal Investments
Topic: Buying a house, sell REITs?
Replies: 8
Views: 766

Re: HSA pre-tax contribution rules

The company contributions are very compelling reason to not make one lump sum HSA contribution. That same reasoning has applied to most 401k plans as well. However, company percentage matching contributions for HSAs are rare. Most employers who contribute to an HSA will make a fixed contribution ev...
by grabiner
Sun Aug 31, 2014 8:43 pm
 
Forum: Personal Finance (Not Investing)
Topic: HSA pre-tax contribution rules
Replies: 12
Views: 840

Re: Max Contribution 401K Traditional vs Roth

The argument is correct, and it makes the Roth 401(k) a potentially better investment if you can max it out. If you are in a 28% bracket and will retire in a 25% bracket, you would be better off putting $10,000 in a traditional 401(k) (worth $7500 at retirement) than $7200 in a Roth 401(k). But if y...
by grabiner
Sun Aug 31, 2014 5:59 pm
 
Forum: Investing - Theory, News & General
Topic: Max Contribution 401K Traditional vs Roth
Replies: 5
Views: 517

Re: Why invest in bonds?

I am having a similar discussion with an acquaintance. I do not know how to draw a graph going back, say, 10 years showing the value of $10k in Total Stock vs $10k in Total Bond vs a 75/25 allocation of $10k. I'd like to include rebalancing every year or quarter or whatever. And, of course, dividen...
by grabiner
Sun Aug 31, 2014 5:55 pm
 
Forum: Investing - Theory, News & General
Topic: Why invest in bonds?
Replies: 88
Views: 4465

Re: Why invest in bonds?

The missing assumption is that you will stick with your allocation in a bear market. Therefore, I never recommend more than 80% stock unless you already know how you will react to losing a large fraction of your portfolio. A lot of investors discovered in 2007-2009 that this wasn't right for them. I...
by grabiner
Sun Aug 31, 2014 5:50 pm
 
Forum: Investing - Theory, News & General
Topic: Why invest in bonds?
Replies: 88
Views: 4465

Re: The Power of Zero: Controversial New Book About Taxes

Well right now my tax exempt bond funds have higher returns than my taxable for about the same duration. I don't know what that says about peoples opinion of my states economic situation:) But yep in general all of this tax stuff will cost you money. The returns of your municipal-bond funds are hig...
by grabiner
Sun Aug 31, 2014 5:14 pm
 
Forum: Investing - Theory, News & General
Topic: The Power of Zero: [Book and tax planning for retirement]
Replies: 51
Views: 4567

Re: The Power of Zero: Controversial New Book About Taxes

Tax-exempt bond funds have low returns. I'd be solving one problem and creating another. Also, any distributions from bond funds or tax-efficient stock funds would count as "provisional income". This could cause my Social Security benefits to become taxable. And so would distributions fro...
by grabiner
Sun Aug 31, 2014 3:01 pm
 
Forum: Investing - Theory, News & General
Topic: The Power of Zero: [Book and tax planning for retirement]
Replies: 51
Views: 4567

Re: Need advice on where to invest in REITs in my portfolio

Grabiner, what is your thinking about .75% in the 401k vs. .57% in a Variable Annuity? The 401k would have a tax-advantage on the front end, but would push something else out. I think the earnings would be taxed the same in a VA vs the 401k. To do the comparison, you have to estimate the costs of a...
by grabiner
Sun Aug 31, 2014 2:57 pm
 
Forum: Investing - Help with Personal Investments
Topic: Need advice on where to invest in REITs in my portfolio
Replies: 9
Views: 703

Re: Need advice on where to invest in REITs in my portfolio

Yes, I am in the highest bracket and also live in CA. If you are a high CA tax bracket, REITS aren't an ideal choice for the HSA either, as the high dividend yield will be taxed in CA as well. One possibility would be to hold your bonds as TIPS in the HSA (exempt from CA tax) and REITs in your 401(...
by grabiner
Sun Aug 31, 2014 1:16 pm
 
Forum: Investing - Help with Personal Investments
Topic: Need advice on where to invest in REITs in my portfolio
Replies: 9
Views: 703

Re: What to do with 401K portfolio moving from TSP Gov

I realize the cost basis is low in TSP and I think I need to make at least 7-9% growth annually, and according to general advise could take 4% per year out. If you need 7-9% growth annually, you aren't ready to retire. 8% is about what I would expect from an investment which is entirely in stock, a...
by grabiner
Sun Aug 31, 2014 1:11 am
 
Forum: Investing - Help with Personal Investments
Topic: What to do with 401K portfolio moving from TSP Gov
Replies: 13
Views: 685

Re: NYC [Visit to New York City]

Years ago the circle line was an interesting diversion, and it was from the water. I still recommend it, having gone three times. It's a three-hour tour all the way around Manhattan, so you get a waterside view of many points of interest and neighborhoods in Manhattan, and all the bridges. Bring a ...
by grabiner
Sun Aug 31, 2014 1:06 am
 
Forum: Personal Consumer Issues
Topic: NYC [Visit to New York City]
Replies: 44
Views: 1789

Re: Probability question

The organizer of our fantasy football league has drawn the #1 draft position out of a basket for the second straight year. He asked me "What are the odds?" I told him the odds were obviously 1-1 since he was the guy in charge. But, seriously, since it is a 12-man league, I assume the odds...
by grabiner
Sun Aug 31, 2014 1:02 am
 
Forum: Personal Consumer Issues
Topic: Probability question
Replies: 14
Views: 1114

Re: Ideas for thanking a doctor

Two other professional options: A good word about the doctor to another doctor. When my primary-care physician refers me to a specialist, who refers me to a second specialist, I make sure the primary-care physician knows if I was happy with both specialists. Specialists depend on referrals for most ...
by grabiner
Sun Aug 31, 2014 12:56 am
 
Forum: Personal Consumer Issues
Topic: Ideas for thanking a doctor
Replies: 58
Views: 2668

Re: Auto Loan Payoff question

The one reason you might want to pay off the loan is a secondary benefit. The lender likely requires you to have collision and comprehensive insurance with a low deductible, to protect its right to payment. If you pay off the loan, you can raise your deductibles, which may save you more than the ret...
by grabiner
Sun Aug 31, 2014 12:42 am
 
Forum: Personal Finance (Not Investing)
Topic: Auto Loan Payoff question
Replies: 7
Views: 786

Re: pay off .9% car loan to invest more in Fidelity 403b?

Given the low rate, I wouldn't recommend paying significant taxes to pay down the loan early from your taxable account. Since you are in the 15% tax bracket, you pay no federal tax on long-term capital gains, but you do still pay VA tax; therefore, you should only use dividends from the taxable acco...
by grabiner
Sun Aug 31, 2014 12:36 am
 
Forum: Investing - Help with Personal Investments
Topic: pay off .9% car loan to invest more in Fidelity 403b?
Replies: 3
Views: 355

Re: Selling Covered Calls, Am I Missing Something??

If you are trying to reduce the risk of a concentrated position that you have a reason for not all selling now, then buying puts makes more sense. If you hold stock for $40 and write a covered call for $4, you make the $4 if the stock doesn't rise in value, but you take the almost the full downside;...
by grabiner
Sun Aug 31, 2014 12:29 am
 
Forum: Investing - Help with Personal Investments
Topic: Selling Covered Calls, Am I Missing Something??
Replies: 7
Views: 888

Re: What to do with 401K portfolio moving from TSP Gov

The reason to leave money in the TSP is the G fund, which is better than anything available at retail; Vanguard has comparable funds to the F, C, S and I funds at barely higher costs. Therefore, if you have more in the TSP than you will want to have in the G fund, you can make your one partial withd...
by grabiner
Sun Aug 31, 2014 12:21 am
 
Forum: Investing - Help with Personal Investments
Topic: What to do with 401K portfolio moving from TSP Gov
Replies: 13
Views: 685

Re: The Power of Zero: Controversial New Book About Taxes

Makes sense under normal circumstances. However, I was wondering if it would it ever make sense to move money into a LIRP. For example, if you're retired, and you get a windfall, where would you place this money for maximum tax efficiency? Is there something wrong with a tax-exempt bond fund? If yo...
by grabiner
Sat Aug 30, 2014 5:25 pm
 
Forum: Investing - Theory, News & General
Topic: The Power of Zero: [Book and tax planning for retirement]
Replies: 51
Views: 4567

Re: Why is my 401k and taxable considered "One Portfolio"?

There seems to be several schools of thought on this. Not sure if there's a single right answer. As Larry Swedroe puts it in his financial plan book (paraphrasing), if you put x pre-tax dollars in your retirement account and your tax rate upon withdrawl is say 28%, you are in effect investing that ...
by grabiner
Sat Aug 30, 2014 3:05 pm
 
Forum: Investing - Theory, News & General
Topic: Why is my 401k and taxable considered "One Portfolio"?
Replies: 13
Views: 1002

Re: Style Box breakdown of U.S. companies

Vanguard's Total Stock Market fund (VTSAX) has the following Morningstar style chart. It is taken from Morningstar's page for VTSAX (http://portfolios.morningstar.com/fund/summary?t=VTSAX). It should be representative of all US companies. http://i57.tinypic.com/2my408p.png The distribution is based...
by grabiner
Sat Aug 30, 2014 2:59 pm
 
Forum: Investing - Theory, News & General
Topic: Style Box breakdown of U.S. companies
Replies: 5
Views: 352

Re: Thoughts on California Municipal Bond Funds

Only interest payments from Munis themselves are exempt from taxes. If a fund manager dips into other sources of money to pay for the dividends, such as new money from investors, then it is not exempt from taxes. Fund managers don't need to do this. The IRS requires a fund to distribute as dividend...
by grabiner
Sat Aug 30, 2014 2:54 pm
 
Forum: Investing - Theory, News & General
Topic: Thoughts on California Municipal Bond Funds
Replies: 32
Views: 2463

Re: The Power of Zero: Controversial New Book About Taxes

I plan on taking Social Security at age 62 (as well as my pension). This means that I will only have to cover 10 years of my retirement using exclusively my own funds (age 52-62). However, by age 70 1/2 (assuming the law remains the same), I will be required to withdraw 3.65% annually from my tax-d...
by grabiner
Sat Aug 30, 2014 11:30 am
 
Forum: Investing - Theory, News & General
Topic: The Power of Zero: [Book and tax planning for retirement]
Replies: 51
Views: 4567

Re: Inflation Protected Securities

Vanguard's fund is not an index fund, so it will not necessarily track the index. However, there are only two main factors determining the performance of a TIPS fund, since they all hold similar securities: duration and cost. I believe the Vanguard fund has about the same duration as the index, so ...
by grabiner
Sat Aug 30, 2014 11:14 am
 
Forum: Investing - Help with Personal Investments
Topic: Inflation Protected Securities
Replies: 14
Views: 1579

Re: Wrong state tax withheld, over $1000 extra tax!

I will answer based on my own experience, but can't guarantee that this applies in your case. When I earned money in two states in one year (both of which had state income tax), I filled out partial-year income tax returns for both states. As I recall, the earned income was taxed only by the state ...
by grabiner
Sat Aug 30, 2014 12:26 am
 
Forum: Personal Finance (Not Investing)
Topic: Wrong state tax withheld, over $1000 extra tax
Replies: 9
Views: 557

Re: Wrong state tax withheld, over $1000 extra tax!

Getting the problem fixed will require that you contact payroll and check the procedures, which may include a corrected W-4. Your employer may also have a form for you to certify that you are a resident of a no-tax state (or of a state which has no special withholding form). You need to get this cor...
by grabiner
Fri Aug 29, 2014 11:17 pm
 
Forum: Personal Finance (Not Investing)
Topic: Wrong state tax withheld, over $1000 extra tax
Replies: 9
Views: 557

Re: Paying cash for a car or financing

I assumed that 2 people need to buy a $30,000 car in 5 years, so they are going to save $500/mo for the next 6 months. Person A = Invests $500/mo for the next 5 years averaging 7%. At the end of 5 years, he stops investing to buy the car. Loan is 7% for 60 months, with a payment of $600/mo. At the ...
by grabiner
Fri Aug 29, 2014 11:06 pm
 
Forum: Personal Finance (Not Investing)
Topic: Paying cash for a car or financing
Replies: 7
Views: 727

Re: High net worth in CA - what % of bonds in munis?

For taxable bonds, max out on I-Bonds every year; they are exempt from CA tax, and the federal tax is deferred until you cash them in, when you may be retired and in a lower tax bracket. Likewise, you may want Treasury bonds (likely TIPS) for your other taxable bonds; since you pay a high state tax,...
by grabiner
Fri Aug 29, 2014 10:28 pm
 
Forum: Investing - Theory, News & General
Topic: High net worth in CA - what % of bonds in munis?
Replies: 21
Views: 1462

Re: Inflation Protected Securities

My company's 401K only has this for Inflation protected securities: Barclays Capital U.S. Government Inflation-Linked Bond Index Does anyone know if this fund is equivalent or how close is it to the Vanguard's version? I need to allocate about 10% of my asset to inflation protected securities. Than...
by grabiner
Fri Aug 29, 2014 10:22 pm
 
Forum: Investing - Help with Personal Investments
Topic: Inflation Protected Securities
Replies: 14
Views: 1579

Re: New job, HSA, where to begin

The one benefit of using your own HSA is you could choose somewhere like HSA Bank or HSA Administrators and invest the money. In addition, you can roll over money between HSA providers, just as you can do with IRA providers. If you don't like the options in the HSA chosen by your employer, you can ...
by grabiner
Fri Aug 29, 2014 10:14 pm
 
Forum: Investing - Help with Personal Investments
Topic: New job, HSA, where to begin
Replies: 3
Views: 401

Re: How low can Vanguard Fees Go?

You can compare Vanguard to the US Thrift Savings Plan. "In 2012, the TSP expenses charged to participants were $0.27 per $1,000 invested. The industry average was $8.30 per $1,000. (Deloitte, “Inside the Structure of Defined Contribution/401(k) Plan Fees,” 2011.)" -TSP website. A few dif...
by grabiner
Fri Aug 29, 2014 6:46 pm
 
Forum: Investing - Theory, News & General
Topic: How low can Vanguard Fees Go?
Replies: 32
Views: 2169

Re: Tax Exempt or Taxable Bond Fund

Let's suppose that I want to keep a certain small holding of bonds in my Taxable Account. I don't know anything about bonds. I'm reading Larry's book on them now so that gives you an idea of my level of sophistication. Just as a quick and dirty way to choose is this reasoning correct? Vanguards Int...
by grabiner
Fri Aug 29, 2014 6:40 pm
 
Forum: Investing - Theory, News & General
Topic: Tax Exempt or Taxable Bond Fund
Replies: 3
Views: 388

Re: The Power of Zero: Controversial New Book About Taxes

The other risk is that tax laws might change in a different way. Suppose that taxes are raised by keeping the income tax unchanged but adding a value-added tax. Now, you will pay the value-added tax on anything you spend out of any account, so there is no change to the preference between accounts; y...
by grabiner
Fri Aug 29, 2014 6:33 pm
 
Forum: Investing - Theory, News & General
Topic: The Power of Zero: [Book and tax planning for retirement]
Replies: 51
Views: 4567

Re: Tax loss harvesting

My general thinking is that I contribute to all my funds once a quarter (3/1,6/1,9/1,12/1). Due to wash sale rules, I cannot do any TLH one month before and after these dates. That essentially leaves one month each quarter where I can do TLH. You can TLH in the 30 days after your contribution witho...
by grabiner
Fri Aug 29, 2014 6:27 pm
 
Forum: Investing - Help with Personal Investments
Topic: Tax loss harvesting
Replies: 32
Views: 1472

Re: Vanguard Fund w/ Tax-Efficiency

Before I found Bogleheads, I used this fund because it's name of "Tax Managed Balanced Fund." It may be what you want. (I now use more of a 4 fund portfolio for myself) https://personal.vanguard.com/us/FundsSnapshot?FundId=0103&FundIntExt=INT Normally, I don't like the Tax-Managed Bal...
by grabiner
Fri Aug 29, 2014 6:22 pm
 
Forum: Investing - Help with Personal Investments
Topic: Vanguard Fund w/ Tax-Efficiency
Replies: 8
Views: 658
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