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Re: Market not interested in inflation protection?

folks in general may not value the benefits as much as the insurance companies project the likely costs to be. I have always thought this was the primary driver of the funny market. Basically, the average consumer doesn't understand and underestimates the risks of inflation, and therefore underesti...
by letsgobobby
Thu Jul 31, 2014 12:12 pm
 
Forum: Investing - Theory, News & General
Topic: Market not interested in inflation protection?
Replies: 27
Views: 1721

Re: How many families use 529 plans?

No, the point is that saving in a retirement plan does NOT hurt your child's chances for financial aid on the FAFSA. 529s and taxable accounts are viewed the same on a FAFSA. Child-held accounts have their own rules have a 20% annual contribution expectation. Don't necessarily agree with your last c...
by letsgobobby
Thu Jul 31, 2014 12:04 pm
 
Forum: Personal Finance (Not Investing)
Topic: How many families use 529 plans?
Replies: 34
Views: 1297

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

The cash flow wasn't really a concern, it doesn't much matter to me whether the money is in the house as equity or in my bank account. Also note my down payment was less than 20%. Would you buy the house as described with a traditional 30 year fixed mortgage as an investment? It would look reasonab...
by letsgobobby
Thu Jul 31, 2014 10:07 am
 
Forum: Personal Finance (Not Investing)
Topic: Landlording for long-term wealth? Who's doing it?
Replies: 47
Views: 4000

Re: How many families use 529 plans?

For most Americans, 529s are an iffy proposition. The primary gains are: 1. state tax credit; 2. forced or at least siloed savings. The disadvantages are: 1. the average American doesn't go to college; 2. the average American could pay 0% tax in long term capital gains even without a 529; 3. the ave...
by letsgobobby
Thu Jul 31, 2014 10:06 am
 
Forum: Personal Finance (Not Investing)
Topic: How many families use 529 plans?
Replies: 34
Views: 1297

Re: PE10

Well I have followed PE10 for more than 15 years, and I never used it in the way you or the author are describing. Assume an average PE10 of 16. I assume between PE10 of 12 and 20 PE10 tells me absolutely nothing. Below 12 I get excited to buy stocks. Above PE10 20 I get nervous. Above PE10 25 I dec...
by letsgobobby
Wed Jul 30, 2014 11:17 pm
 
Forum: Investing - Theory, News & General
Topic: PE10
Replies: 13
Views: 1096

Re: PE10

Agreed. It is full of specious arguments and is internally inconsistent as well. How can the author define the market as overvalued whenever pe10 is above its mean, then turn around and say it never flashed a clear buy signal when it was below its mean? Successful investors understand probabilities ...
by letsgobobby
Wed Jul 30, 2014 9:42 pm
 
Forum: Investing - Theory, News & General
Topic: PE10
Replies: 13
Views: 1096

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

The cash flow wasn't really a concern, it doesn't much matter to me whether the money is in the house as equity or in my bank account. Also note my down payment was less than 20%. Would you buy the house as described with a traditional 30 year fixed mortgage as an investment?
by letsgobobby
Wed Jul 30, 2014 8:12 pm
 
Forum: Personal Finance (Not Investing)
Topic: Landlording for long-term wealth? Who's doing it?
Replies: 47
Views: 4000

Re: Fidelity Charitable Fund Questions

We let ours build but that wasn't the original plan. I put in $x in 2008 and 2009 but was entirely in money market fund, and then went 100% stocks in February 2009 so it about doubled in 2 years. We keep contributing and we keep making grants but it doesn't go down. So we will keep increasing our gr...
by letsgobobby
Wed Jul 30, 2014 8:11 pm
 
Forum: Investing - Help with Personal Investments
Topic: Fidelity Charitable Fund Questions
Replies: 18
Views: 668

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

I bought a $187k home last year, with $27k down and financed $160k for 12 years at 3.25%. We then put about $6k into it in the form of repairs and upgrades. It rented in August for $1250 per month. We pay a management company $100 per month. We've paid about $250 in small repairs and $1500 to take o...
by letsgobobby
Wed Jul 30, 2014 4:21 pm
 
Forum: Personal Finance (Not Investing)
Topic: Landlording for long-term wealth? Who's doing it?
Replies: 47
Views: 4000

Re: retirement savings for my young kids?

A UGMA/UTMA is a great tool, since the money we're talking about is not enough to ruin their lives, but it's still 'their' money. However the financial aid is a problem. A 529 solves that problem. I think a trust is overkill for $10k. We have a few different ways we save for our kids: - in 529s (par...
by letsgobobby
Wed Jul 30, 2014 4:15 pm
 
Forum: Investing - Help with Personal Investments
Topic: retirement savings for my young kids?
Replies: 29
Views: 2189

Re: Principal Residence = Poor Investment?

Two times a home can be a good investment: - when you buy at the bottom of a serious V shaped housing crash; - when you buy in a place with unusually persistent supply demand imbalances. Since you often can't know these things until much later, it's hard to count on housing being a good investment. ...
by letsgobobby
Wed Jul 30, 2014 4:00 pm
 
Forum: Personal Finance (Not Investing)
Topic: Principal Residence = Poor Investment?
Replies: 61
Views: 3384

Re: Fidelity Charitable Fund Questions

Another user of Fido's DAF here.

It's been pointed out, and worth remembering, that you pay 0.6% in addition to underlying fund costs on these accounts. So not a good idea to store money there long term.
by letsgobobby
Wed Jul 30, 2014 12:30 pm
 
Forum: Investing - Help with Personal Investments
Topic: Fidelity Charitable Fund Questions
Replies: 18
Views: 668

Re: Owning individual stocks to harvest tax losses

Has been discussed. Do a search. Also Google motif.com.
by letsgobobby
Tue Jul 29, 2014 9:17 am
 
Forum: Investing - Theory, News & General
Topic: Owning individual stocks to harvest tax losses
Replies: 17
Views: 893

Re: Do Bogleheads Feel Wealthier?

Additional spending wouldn't improve my quality of life, since I already spend enough to have everything that makes me happy. In fact, I enjoy being thrifty a lot more than buying fancy stuff. I also enjoy, perhaps irrationally, watching my net worth increase. However, while the "wealth effect...
by letsgobobby
Mon Jul 28, 2014 1:39 am
 
Forum: Personal Finance (Not Investing)
Topic: Do Bogleheads Feel Wealthier?
Replies: 57
Views: 4430

Re: 36 percent decline in net worth

Just a guess . . . Those in the median net worth group had most of their net worth in housing. They did not benefit much from the stock market recovery. Prices in real estate continued to fall in our area into late 2011, early 2012. Most Americans DID have most of their wealth in housing. That's wh...
by letsgobobby
Mon Jul 28, 2014 12:31 am
 
Forum: Investing - Theory, News & General
Topic: 36 percent decline in net worth
Replies: 38
Views: 5857

Re: Best Coffee Maker? What do you have?

Believe it or not, I'm quite happy with the "free" Gevalia coffee makers they used to give out for trying their lousy coffee. I'd sign up, get the 2 bags of coffee and the coffee maker for $10-20 shipping, throw out the coffee, and cancel the membership. I ended up with a programmable 12 c...
by letsgobobby
Mon Jul 28, 2014 12:28 am
 
Forum: Personal Consumer Issues
Topic: Best Coffee Maker? What do you have?
Replies: 65
Views: 4543

Re: If you tax adjust, how has it changed your life?

David, it sounds like you're saying the impact of tax adjusting has been extremely small, not enough to make any meaningful difference?
by letsgobobby
Mon Jul 28, 2014 12:25 am
 
Forum: Investing - Theory, News & General
Topic: If you tax adjust, how has it changed your life?
Replies: 16
Views: 1919

Re: Do Bogleheads Feel Wealthier?

I read a lot about the wealth effect but I never believed it. My perspective was that of an early career investor. If our stocks went up 1% or 5% or 10%, I did not feel richer at all. It wasn't enough money to make me feel richer. Neither the increase nor the total wealth in dollars were enough to c...
by letsgobobby
Mon Jul 28, 2014 12:24 am
 
Forum: Personal Finance (Not Investing)
Topic: Do Bogleheads Feel Wealthier?
Replies: 57
Views: 4430

Re: If you tax adjust, how has it changed your life?

Imagine there were no tax differences but instead your Roth IRA balances were presented to you is US dollars, your taxable accounts in Australian dollars and your Traditional IRA / 401(k) in Canadian dollars, would you feel comfortable just adding these "dollars" up or setting AA based on...
by letsgobobby
Sun Jul 27, 2014 8:30 pm
 
Forum: Investing - Theory, News & General
Topic: If you tax adjust, how has it changed your life?
Replies: 16
Views: 1919

Re: POLL: My home is worth less/more in 2014 than in 2007?

Built in 06 and sold in 07 for $825k at the very top of the market. Those owners stopped paying within 2 years and had tax liens, HOA liens, etc by the time we bought the short sale for $495k in 2011, probably within a month of the bottom of the market. Don't know current best valuation; Zillow says...
by letsgobobby
Sun Jul 27, 2014 8:24 pm
 
Forum: Personal Finance (Not Investing)
Topic: POLL: My home is worth less/more in 2014 than in 2007?
Replies: 82
Views: 4050

Re: Vanguard sued for charging too little

I thought this would be an Onion article.
by letsgobobby
Sat Jul 26, 2014 9:54 pm
 
Forum: Personal Finance (Not Investing)
Topic: Vanguard sued for charging too little
Replies: 108
Views: 10849

Re: Need advice choosing fund for college expenses (not 529)

One other tip on 529s is that having more than one per child limits taxes and penalties you might otherwise pay due to account aggregation (as pointed out above). We own six 529s with three different states and some are in my name and some are in my wife's name; some hold only prepaid tuition and so...
by letsgobobby
Sat Jul 26, 2014 11:24 am
 
Forum: Investing - Help with Personal Investments
Topic: Need advice choosing fund for college expenses (not 529)
Replies: 15
Views: 766

Re: Need advice choosing fund for college expenses (not 529)

Thanks a lot for this information. It brings up good ideas that I had not entertained. I had thought a separate 'pot' of money would be easier to account for, keep an eye on, and place in a different risk category than my other longer term investments which are more aggressive. I am eligible for th...
by letsgobobby
Sat Jul 26, 2014 10:09 am
 
Forum: Investing - Help with Personal Investments
Topic: Need advice choosing fund for college expenses (not 529)
Replies: 15
Views: 766

Re: Public Speaking-help

I have at least as bad a problem. I get shaky even thinking about being in a meeting with people who report to me. Twice a year I am asked to give a reflection in front of a group of 10-60 people, most whom I've known for a decade. The reflection lasts 1-3 minutes or less. I agonize over it for days...
by letsgobobby
Sat Jul 26, 2014 9:38 am
 
Forum: Personal Consumer Issues
Topic: Public Speaking-help
Replies: 65
Views: 3206

Re: Need advice choosing fund for college expenses (not 529)

I see no reason at all for you to establish a separate pot of money for your kids in a taxable account. You have taxable pots of money here, and there, and everywhere, and it doesn't matter what you call them. If you actually give the kids the money you might squeeze out a little tax gain harvesting...
by letsgobobby
Fri Jul 25, 2014 7:13 pm
 
Forum: Investing - Help with Personal Investments
Topic: Need advice choosing fund for college expenses (not 529)
Replies: 15
Views: 766

Re: equal asset location and rebalancing

You are being too simplistic or not simplistic enough. Over the 2-year period TSM would have paid out dividends: $1,000 the first year and $1,000 the 2nd year. Those dividends would have been invested back into the bonds. Thus at the end of 2 years, the ratios would have been about $55K to $58K and...
by letsgobobby
Fri Jul 25, 2014 7:04 pm
 
Forum: Investing - Theory, News & General
Topic: equal asset location and rebalancing
Replies: 6
Views: 564

equal asset location and rebalancing

Can someone explain how equal asset location can be an optimal answer when rebalancing is taken into account? Doesn't this require constantly realizing capital gains in the taxable account to rebalance (typically stocks into bonds), thus Here's a simple example: taxable: $50k or 50% VWITX (tax exemp...
by letsgobobby
Fri Jul 25, 2014 1:48 pm
 
Forum: Investing - Theory, News & General
Topic: equal asset location and rebalancing
Replies: 6
Views: 564

Re: Rules of thumb that shouldn't be

In your opinion, what rules of thumb are too often incorrect to be a good rule of thumb? Judging by the recent thread about tax adjustment and the wiki article on tax efficient asset location, some would probably include the following on the list: "stocks should go in taxable, bonds should go ...
by letsgobobby
Fri Jul 25, 2014 12:43 pm
 
Forum: Investing - Theory, News & General
Topic: Rules of thumb that shouldn't be
Replies: 39
Views: 4171

Re: Rules of thumb that shouldn't be

1) By number of investors and/or by total wealth invested, I would not assume good 401K plans are rare. Most megacorps and the Federal Government have good plans, many even better than any IRA. That does not addresss liability exposure concerns either. There are a lot of awful plans in smaller comp...
by letsgobobby
Fri Jul 25, 2014 12:41 pm
 
Forum: Investing - Theory, News & General
Topic: Rules of thumb that shouldn't be
Replies: 39
Views: 4171

Re: Rules of thumb that shouldn't be

livesoft wrote:Lump-sum is better than dollar-cost averaging



crushtheturtle wrote:age in bonds


Expand?
by letsgobobby
Fri Jul 25, 2014 12:22 pm
 
Forum: Investing - Theory, News & General
Topic: Rules of thumb that shouldn't be
Replies: 39
Views: 4171

Rules of thumb that shouldn't be

In your opinion, what rules of thumb are too often incorrect to be a good rule of thumb? My pet peeve is: "You should usually roll over an old 401k into an IRA" I dislike this one because it's not true for so many investors and situations: - 401ks can have much lower expense ratios than IR...
by letsgobobby
Fri Jul 25, 2014 10:09 am
 
Forum: Investing - Theory, News & General
Topic: Rules of thumb that shouldn't be
Replies: 39
Views: 4171

Re: Momentum Investing ?

Maybe there were Value, Momentum, Profit, etc premiums 20 years ago but doesn't the very act of creating funds to try to capture these premiums change the conditions in which these premiums persisted? Larry himself said the act of publishing a paper on a premium reduced the premium by 1/3. How much...
by letsgobobby
Fri Jul 25, 2014 9:41 am
 
Forum: Investing - Theory, News & General
Topic: Momentum Investing ?
Replies: 55
Views: 4324

If you tax adjust, how has it changed your life?

For those of you who tax adjust your asset allocation (please see below links for more on this topic itself), would you provide a specific example of how doing so has caused you to change something in your behavior? or thinking? For example, if you tax adjust and as a result hold 3% fewer stocks in ...
by letsgobobby
Fri Jul 25, 2014 9:28 am
 
Forum: Investing - Theory, News & General
Topic: If you tax adjust, how has it changed your life?
Replies: 16
Views: 1919

Re: Bonds beat stocks over the last 15 years

It is rather remarkable that despite a PE10 of 40+ in 1999, the 15 year return of the market has been as good as 5%. The 10 year return was terrible, of course. Historically the starting PE10 has predicted the 20 year return best. What will the next 5 years bring? If stocks do not fall sharply from ...
by letsgobobby
Thu Jul 24, 2014 3:24 pm
 
Forum: Investing - Theory, News & General
Topic: Bonds beat stocks over the last 15 years
Replies: 93
Views: 7676

Re: The article on tax efficient placement needs to be rewri

The people talking about taxes due on a traditional IRA in this discussion are ... misguided. Those taxes will be due regardless of whether you invested in stocks, bonds, or anything else, so from an asset location perspective it doesn't matter. The right way to think about that is effect is to tax...
by letsgobobby
Thu Jul 24, 2014 3:09 pm
 
Forum: Investing - Theory, News & General
Topic: The article on tax efficient placement needs to be rewri
Replies: 75
Views: 4077

Re: The article on tax efficient placement needs to be rewri

I agree with those who believe that the article is very flawed. Sure there are some warnings in it, but it still focuses on placing bonds in tax deferred areas, and the individual pitfalls are not mentioned too much after the initial warnings. I am glad for those in whom the article works, i think ...
by letsgobobby
Thu Jul 24, 2014 11:59 am
 
Forum: Investing - Theory, News & General
Topic: The article on tax efficient placement needs to be rewri
Replies: 75
Views: 4077

Re: How to set up a trust

I also took bsteiner's advice and with my estate planning attorney have set up the same. I described it here:

viewtopic.php?f=2&t=143352&p=2129667#p2129484
by letsgobobby
Thu Jul 24, 2014 3:06 am
 
Forum: Personal Finance (Not Investing)
Topic: How to set up a trust
Replies: 11
Views: 1795

Re: The article on tax efficient placement needs to be rewri

maybe - can you walk me through the 'extra 30-50 bps/yr with no additional risk' part? Assume: 1) 25% Tax on Treasuries and ~10% effective (15% statutory) tax rate on equities. (The actual equity tax bracket and length of investment determine the effective tax bracket for equities. It varies a lot ...
by letsgobobby
Thu Jul 24, 2014 3:03 am
 
Forum: Investing - Theory, News & General
Topic: The article on tax efficient placement needs to be rewri
Replies: 75
Views: 4077

Re: 2 days in Portland, suggestions?

Cool moon ice cream in the pearl is nearly as good, way less attitude, cheaper, and almost no lines.
by letsgobobby
Thu Jul 24, 2014 12:02 am
 
Forum: Personal Consumer Issues
Topic: 2 days in Portland, suggestions?
Replies: 34
Views: 1347

Re: Where is your brokerage account?

There are a number of good options but I don't think Chase is one of them. What makes you think of Chase?
by letsgobobby
Wed Jul 23, 2014 3:18 pm
 
Forum: Investing - Help with Personal Investments
Topic: Where is your brokerage account?
Replies: 41
Views: 2609

Re: Please help settle an argument

Always is almost always wrong.

Everything depends.

I'd borrow at 0%, but not 5%.
by letsgobobby
Wed Jul 23, 2014 2:33 pm
 
Forum: Personal Finance (Not Investing)
Topic: Please help settle an argument
Replies: 23
Views: 1950

Re: Reaching Severe Burnout - Can I Scale Back Career?

With expenses $55k per year you have 10x+ expenses saved at age 30. now certainly your expenses will rise as you start to have a family, and if you plan to pay for college you will want to consider that. Nevertheless you are far, far ahead of most 30 year olds - actually, you are far, far ahead of m...
by letsgobobby
Wed Jul 23, 2014 1:11 pm
 
Forum: Personal Finance (Not Investing)
Topic: Reaching Severe Burnout - Can I Scale Back Career?
Replies: 48
Views: 5049

Re: The article on tax efficient placement needs to be rewri

Really this comes down to what one considers to be "normal" interest rates. If rates now are "abnormally low" and are sure to go back up to 7 or 8% any day now, then bonds should go in tax advantaged. If sub-3% rates are the "new normal", then the old rules are wrong. ...
by letsgobobby
Wed Jul 23, 2014 12:50 pm
 
Forum: Investing - Theory, News & General
Topic: The article on tax efficient placement needs to be rewri
Replies: 75
Views: 4077

Re: The article on tax efficient placement needs to be rewri

You can play with the numbers, but there's actually no way to get stocks to be advantageous in the taxable space unless you assume returns very close to bonds, which is a low probability event and not true over long periods. What is also not true over long periods of time is that bonds have yields ...
by letsgobobby
Wed Jul 23, 2014 11:20 am
 
Forum: Investing - Theory, News & General
Topic: The article on tax efficient placement needs to be rewri
Replies: 75
Views: 4077

Re: New vehicle...GMC Acadia, Chevy Traverse, or Buick Encla

My only hang up is Dodge reliability. I'm not unwilling to try it, but as an exclusively Toyota and Honda owner I wanted to get that first year report. Wow - this is surprising. I feel this is just accepted that you won't beat the reliability of Toyota or Honda. It seems like going with the Durango...
by letsgobobby
Wed Jul 23, 2014 10:40 am
 
Forum: Personal Consumer Issues
Topic: New vehicle...GMC Acadia, Chevy Traverse, or Buick Enclave?
Replies: 64
Views: 5285

Re: P/E Ratio: How do YOU interpret/use it?

At current pe10 I am particularly likely to buy stocks in taxable. At lower pe10 I am more likely to buy stocks in 529. Basically I since the risk of loss increases as pe10 increases, I don't want to give up a possible future tax loss harvest.
by letsgobobby
Wed Jul 23, 2014 2:44 am
 
Forum: Investing - Theory, News & General
Topic: P/E Ratio: How do YOU interpret/use it?
Replies: 26
Views: 1351

Re: 2 days in Portland, suggestions?

If you haven't already, worth watching an episode or two of Portlandia before you go. When people hear we are from (near) PDX, the first thing they always ask us is, 'Is it really like Portlandia?' Our answer is, "Yes, sometimes it is!"
by letsgobobby
Tue Jul 22, 2014 8:39 pm
 
Forum: Personal Consumer Issues
Topic: 2 days in Portland, suggestions?
Replies: 34
Views: 1347

Re: 2 days in Portland, suggestions?

you can drive by Multnomah falls, but go about 10 miles further and do the hike to Wahclella falls or Eagle Creek/Punchbowl falls instead. Stroll Alberta, Hawthorne, Belmont, NW 23rd. Eat? anywhere. Drink - beer and wine. I think we're up to 40 breweries now, maybe more? If you're in town on a Satur...
by letsgobobby
Tue Jul 22, 2014 5:30 pm
 
Forum: Personal Consumer Issues
Topic: 2 days in Portland, suggestions?
Replies: 34
Views: 1347

Re: 35K maximum retirement contribution a year for a person?

Are either of your plans available in a Roth version? That may be preferable if your taxable income is below 5 figures.
by letsgobobby
Tue Jul 22, 2014 4:34 pm
 
Forum: Personal Finance (Not Investing)
Topic: 35K maximum retirement contribution a year for a person?
Replies: 16
Views: 1447
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