Search found 1424 matches

by ourbrooks
Wed Jul 01, 2015 2:05 pm
Forum: Personal Finance (Not Investing)
Topic: How to predict state taxes to help decide where to live
Replies: 17
Views: 1139

Re: How to predict state taxes to help decide where to live

Taxes are probably the last thing I'd look at in determining retirement costs. San Angelo, Texas has an average house listing price of $248,507. Austin, Texas has an average house listing price of 681,842. Both cities are in Texas; both have no income tax and about the same sales tax rates. I haven'...
by ourbrooks
Sun Jun 28, 2015 3:09 pm
Forum: Investing - Help with Personal Investments
Topic: AA for 529s that will be used for college and grad school
Replies: 11
Views: 945

Re: AA for 529s that will be used for college and grad school

1. Over rolling, five year historical periods, stocks have lost money in 14% of the periods. 2. Over rolling, 20 year historical periods, there has never been a period with a loss, although the worst gain was a real 19%. Nearly all of your college expenditures occur within the next five years. How w...
by ourbrooks
Sat Jun 27, 2015 1:30 pm
Forum: Investing - Theory, News & General
Topic: Will Demographics Be Destiny for Stocks and Bonds?
Replies: 23
Views: 2939

Re: Will Demographics Be Destiny for Stocks and Bonds?

If you do want to overweight emerging market equities, then the Vanguard funds are probably not the best choices. If you look at the top 10 in the Vanguard Emerging Markets Fund, 8 of the 10 are China based companies; 2 are banks and 2 are insurance companies. What about India, which some pundits pr...
by ourbrooks
Sun Jun 21, 2015 7:04 pm
Forum: Investing - Help with Personal Investments
Topic: Role of annuities in low SWR situations
Replies: 29
Views: 3227

Re: Role of annuities in low SWR situations

Anyone who is 50% cash now is highly risk adverse. Why make them suffer through even the modest market swings of a 25% stock portfolio? The odds are high that even if they went to all cash, they'd have enough for the rest of their lives. They've won the game; why do they need to keep playing? Effect...
by ourbrooks
Fri Jun 19, 2015 7:53 pm
Forum: Personal Consumer Issues
Topic: Should I open up floor of very old home to search for old coins?
Replies: 35
Views: 4990

Re: Should I open up floor of very old home to search for old coins?

Chances are there is a subfloor under the surface floor boards. In new houses that is plywood (or in cheaper construction particleboard), in older houses it would be planks running across joists, and then the flooring running with joists. At least that is how it was done in my house, and my underst...
by ourbrooks
Tue Jun 16, 2015 5:45 pm
Forum: Investing - Help with Personal Investments
Topic: Help - Leveraged ETF's and Natural Gas.
Replies: 21
Views: 1695

Re: Help - Leveraged ETF's and Natural Gas.

Natural gas companies were NOT hit particularly hard when the price of oil dropped; natural gas prices dropped in 2008 and haven't come back since. They're actually higher now than they were at the beginning of 2012. Geologically, oil and natural gas are just points on a continuum; both can come out...
by ourbrooks
Mon Jun 15, 2015 7:18 pm
Forum: Investing - Theory, News & General
Topic: VDE or Vanguard Energy Fund
Replies: 8
Views: 766

Re: VDE or Vanguard Energy Fund

VGENX has an expense ratio of 0.37% as versus 0.12% for VDE. The wider exposure has to be worth at least 0.25% for it to be worthwhile to buy VGENX. I'm presuming that you're expecting several percentage points of outperformance for the energy sector; if it's a point or less, it hardly seems worth it.
by ourbrooks
Mon Jun 15, 2015 6:03 pm
Forum: Investing - Theory, News & General
Topic: VDE or Vanguard Energy Fund
Replies: 8
Views: 766

Re: VDE or Vanguard Energy Fund

Energy companies as a class are relatively underrepresented in the U.S. market; many of the largest, most important energy companies are domiciled outside the U.S., for example, BP and Shell. I can't think of any reason why U.S. companies in this sector should outperform non-U.S. companies and I can...
by ourbrooks
Sat Jun 13, 2015 8:36 pm
Forum: Personal Consumer Issues
Topic: Coffee - just starting out
Replies: 43
Views: 5301

Re: Coffee - just starting out

A cheap experiment is to get yourself a jar of Mexican or European instant coffee. Why Mexican or European? Because they use a darker roast than for the instant coffee intended for the American market. Given the other stuff you're adding to your drink, it'll be hard to detect the difference between ...
by ourbrooks
Thu Jun 11, 2015 7:53 pm
Forum: Personal Consumer Issues
Topic: Dilemma Selling and Buying House
Replies: 19
Views: 2119

Re: Dilemma Selling and Buying House

I might be somewhat reluctant to tell the agent that you were going to take your time buying, least the agent assume that you will be one of those people who burns up their time but never buys anything. Got it but what, in your opinion should I tell them? I feel I need to just be upfront. Negotiate...
by ourbrooks
Thu Jun 11, 2015 6:29 pm
Forum: Personal Consumer Issues
Topic: Dilemma Selling and Buying House
Replies: 19
Views: 2119

Re: Dilemma Selling and Buying House

Feel free to negotiate commission with any agent. It's rarer and rarer for seller's agents to get the full 3%. You don't have to dangle the prospect of a buyer's agent commission to get a lower rate. In fact, I might be somewhat reluctant to tell the agent that you were going to take your time buyin...
by ourbrooks
Thu Jun 11, 2015 5:26 pm
Forum: Personal Finance (Not Investing)
Topic: Any opinions of the Vanguard Fixed Deferred Annuity?
Replies: 19
Views: 2170

Re: Any opinions of the Vanguard Fixed Deferred Annuity?

A Vanguard Fixed Deferred Annuity may not be the same as a Vanguard Deferred Fixed Annuity. The latter is described here:
https://personal.vanguard.com/vlip/Pdf/z144.pdf.

It is NOT a life annuity; it's much more like a bank CD.
by ourbrooks
Wed Jun 10, 2015 7:42 pm
Forum: Investing - Help with Personal Investments
Topic: Elderly in-laws portfolio advice with low funds
Replies: 3
Views: 382

Re: Elderly in-laws portfolio advice with low funds

Consider an SPIA (Single Premium Immediate Annuity). At their ages, you can even get an inflation adjusted one that will pay out more than 5%. The payouts continue as long as they live but there's nothing left when they die, like a pension.
by ourbrooks
Tue Jun 09, 2015 8:59 pm
Forum: Personal Consumer Issues
Topic: Floor Tiles or Ice Skating Rink?
Replies: 9
Views: 1320

Re: Floor Tiles or Ice Skating Rink?

Do a web search for "anti-slip floor coating." I have no personal experience with any of the products that come up but some of them make reasonable claims.

If the coatings fail, take very fine sandpaper to the floor.
by ourbrooks
Tue Jun 09, 2015 7:08 pm
Forum: Personal Consumer Issues
Topic: Mobile Phone SIM to use in Austria/Switzerland
Replies: 2
Views: 279

Re: Mobile Phone SIM to use in Austria/Switzerland

T Mobile has relatively inexpensive international roaming that covers Austria and Switzerland. Data and texting have no additional charges; voice calls are 20 cents a minute. You can use any unlocked phone which handles the frequencies in Austria and Switzerland; just put the T Mobile SIM card in it.
by ourbrooks
Sun Jun 07, 2015 8:13 pm
Forum: Personal Finance (Not Investing)
Topic: Putting off Social Security until 70
Replies: 89
Views: 7529

Re: Putting off Social Security until 70

Many here plan to delay until age 70 due to the 8% per yr increase. I don't agree,however, because the amount at age 62 and 70 are actuarialy equivalent. If I recall correctly, one has to live to ~81 to break even Tis absolutely true that, actuarialy, the expected amounts received are identical for...
by ourbrooks
Sun Jun 07, 2015 6:31 pm
Forum: Investing - Theory, News & General
Topic: I-ORP Vs. Cfiresim.com
Replies: 20
Views: 1935

Re: I-ORP Vs. Cfiresim.com

Let me correct a few common misconceptions about Monte Carlos simulation: 1. There is no requirement whatsoever that a Monte Carlo simulation use a known or continuous distribution. In fact, you can take any set of observed data points and call that a distribution, with or without interpolation func...
by ourbrooks
Wed Jun 03, 2015 9:09 pm
Forum: Personal Finance (Not Investing)
Topic: Kitces - The Ratcheting Safe Withdrawal Rate
Replies: 51
Views: 5382

Re: Kitces - The Ratcheting Safe Withdrawal Rate

VPW doesn't work for me at all. VPW requires either that you have a low return, nearly all bond portfolio, or that you're willing to adjust your spending to follow the gyrations of the stock market. For example, if, in 2008, you held a conservative 50/50 portfolio, the asset allocation used in the o...
by ourbrooks
Wed Jun 03, 2015 5:55 pm
Forum: Personal Finance (Not Investing)
Topic: Kitces - The Ratcheting Safe Withdrawal Rate
Replies: 51
Views: 5382

Re: Kitces - The Ratcheting Safe Withdrawal Rate

Seems to me that there's a much simpler approach than Kitces which will allow you to start increasing spending sooner if the market does well: Start out with 4% of your initial balance and adjust it for inflation each year. Every five years, calculate 4% of your current portfolio. If it's more than ...
by ourbrooks
Sun May 31, 2015 4:41 pm
Forum: Investing - Theory, News & General
Topic: Asset Allocation and withdrawal rate for short life remaining?
Replies: 21
Views: 1730

Re: Asset Allocation and withdrawal rate for short life remaining?

Okay, here's something entirely different: buy her an SPIA. There's something called "medical underwriting" in which the payout is based on the life expectancy of the particular person, rather than the age cohort. In this case, she'd probably get the same payout rate as someone in their 90...
by ourbrooks
Sat May 30, 2015 6:01 pm
Forum: Investing - Theory, News & General
Topic: Is SPIA income fully taxable?
Replies: 16
Views: 1465

Re: Is SPIA income fully taxable?

Alas, we’ve gotten to the heart of the SPIA. Advertised as the single most tax advantaged product since the advent of poverty, the secret sauce is this: most of that payout is return of your own money! But, watch out Comrade, the income equalizers have their eyes on levying a tax on principal. I’m ...
by ourbrooks
Sat May 30, 2015 12:08 pm
Forum: Investing - Help with Personal Investments
Topic: Home Equity as part of your Net Worth?
Replies: 25
Views: 2845

Re: Home Equity as part of your Net Worth?

Focus on costs, not on fixed assets. Consider someone who lives on $100,000 a year in income and has $3,000,000 in investable assets. If they're retired that's more than enough investable assets to provide their full retirement income for at least 30 years. Suppose they buy a $5,000,000 home without...
by ourbrooks
Fri May 29, 2015 3:39 pm
Forum: Investing - Theory, News & General
Topic: Will Single Premium Immediate Annuities be better with higher interest rates?
Replies: 17
Views: 1833

Re: Will Single Premium Immediate Annuities be better with higher interest rates?

Roughly, the payout rate on a fixed payout life annuity is 1/remaining-life-expectancy + 10-year-Treasure-rate. Yes, as interest rates rise, the payouts will increase, but what always has a much bigger effect is age. Suppose you're in your 80's so that your remaining expectancy is around 8 years. Yo...
by ourbrooks
Wed May 27, 2015 7:01 pm
Forum: Investing - Theory, News & General
Topic: Worried about longevity risk...this isn't good news
Replies: 22
Views: 3569

Re: Worried about longevity risk...this isn't good news

The actual reason is probably pretty simple. As a financial vehicle, SPIAs depend on some people dying earlier and some people dying later than their expected lifespans; the ones who die earlier provide funds for the payouts to the ones who die later. The number of people dying earlier and the numbe...
by ourbrooks
Tue May 26, 2015 6:18 pm
Forum: Personal Consumer Issues
Topic: Cellular/wifi traveling to Scotland
Replies: 14
Views: 911

Re: Cellular/wifi traveling to Scotland

T Mobile's Simple Choice Plan offers both U.S. coverage and "unlimited" international data/text and $.20 phone calls for $50 a month. In the U.K., T Mobile is EE. I put the "unlimited" in quotes because I believe it's the same deal as in the U.S.; the first Gbyte is at high speed...
by ourbrooks
Sun May 24, 2015 6:15 pm
Forum: Investing - Help with Personal Investments
Topic: At what point does 529 make sense
Replies: 24
Views: 3211

Re: At what point does 529 make sense

If you don't use a 529 plan for educational expenses, not only are the gains taxed as ordinary income, but there's an additional 10% penalty.
by ourbrooks
Sat May 23, 2015 9:36 pm
Forum: Investing - Theory, News & General
Topic: Land Values, Tax Deferral, Wealth Retention and Income
Replies: 8
Views: 1023

Re: Land Values, Tax Deferral, Wealth Retention and Income

I'm still confused about the situation being described. I can think of several common cases: 1. The parents die and the children don't want to farm. The children get a stepped up basis and don't pay taxes. 2. The parents want to stay on the land. They may rent it out instead of farming it, but they'...
by ourbrooks
Sat May 23, 2015 8:21 pm
Forum: Personal Consumer Issues
Topic: Most effective wifi upgrade for range/speed?
Replies: 27
Views: 2569

Re: Most effective wifi upgrade for range/speed?

Moving from 200 MBps power line to 500 MBps power line improved the reliability as well as the speed. When I was running a lot of power line, the thing that seemed to cause complete dropout was a central air conditioner coming on. It was a very high efficiency unit and, like many inverters, they can...
by ourbrooks
Sat May 23, 2015 6:26 pm
Forum: Personal Consumer Issues
Topic: Most effective wifi upgrade for range/speed?
Replies: 27
Views: 2569

Re: Most effective wifi upgrade for range/speed?

What technology level is your powerline equipment? The first generation was 200 mbit; the latest is 1200. It's highly unlikely, of course, that you'll get 1200MBps, but, even if you only get 10% of that, it'll be enough for video streaming; 10% of 200 MBps isn't.
by ourbrooks
Sat May 23, 2015 5:01 pm
Forum: Investing - Theory, News & General
Topic: Land Values, Tax Deferral, Wealth Retention and Income
Replies: 8
Views: 1023

Re: Land Values, Tax Deferral, Wealth Retention and Income

Deferring taxes isn't even an issue unless you've actually made a profit on the land. Farmland is valuable only to the extent that farmers are able to profitably grow crops on it. Food prices have been falling over a long period of time so farmers need to be more productive to make a profit. How muc...
by ourbrooks
Tue May 19, 2015 6:21 pm
Forum: Investing - Help with Personal Investments
Topic: My Portfolio - Am I a too risk averse?
Replies: 14
Views: 1550

Re: My Portfolio - Am I a too risk averse?

Everyone says "determine your risk tolerance." I have trouble with that; my risk tolerance for not having enough to eat at age 90 is zero. If being in low volatility investments, like bonds, means that I won't have enough to eat, then my risk tolerance for low risk is zero. Even at a histo...
by ourbrooks
Wed May 13, 2015 8:35 pm
Forum: Personal Consumer Issues
Topic: Home Internet - Cat 5e or Cat 6
Replies: 49
Views: 3421

Re: Home Internet - Cat 5e or Cat 6

Smurf tubing, a.k.a. as flexible conduit is the answer but you may have to negotiate a bit for it. You can run Cat 5 through it now and, later, replace it with something else.
by ourbrooks
Wed May 13, 2015 8:30 pm
Forum: Personal Finance (Not Investing)
Topic: Texas Tuition Promise Fund
Replies: 4
Views: 516

Re: Texas Tuition Promise Fund

The Texas Tuition Promise Fund covers only tuition and fees. Tuition and fees are about 35% of costs at a Texas state institution so you'll have to save some other way to cover the full cost. Legally speaking, TTPF is a 529 plan but there's also the Texas College Savings Plan which can be used for n...
by ourbrooks
Tue May 12, 2015 4:54 pm
Forum: Personal Finance (Not Investing)
Topic: Should we purchase home without permits?
Replies: 70
Views: 4599

Re: Should we purchase home without permits?

Leave in all of the inspections. Add additional ones if you can think of any which might be worthwhile. You're in a perfect positions to get a price reduction, depending on the laws in your local area. Where I live, sellers are required to disclose any known defects in a property. Sellers can be ver...
by ourbrooks
Sun May 03, 2015 7:59 pm
Forum: Investing - Theory, News & General
Topic: Pfau, Kitces, & Target-Date Fund glide paths
Replies: 29
Views: 2790

Re: Pfau, Kitces, & Target-Date Fund glide paths

On Wade's paper: I suggest these results do not say what most seem to think they say. First, given their "market expectations data" their 4% and 5% withdrawal rates are so high that the failure rates are such that all allocations are crazy bad. The best is a success rate (for 4%, worse of...
by ourbrooks
Sun May 03, 2015 12:12 pm
Forum: Personal Consumer Issues
Topic: Buying ML350 - how old a car to get?
Replies: 6
Views: 781

Re: Buying ML350 - how old a car to get?

The ML350 is made in plants in the U.S., India and Indonesia. The situation may have changed, but when production started in 2002, they had horrible quality problems. The source of the problems was not the workers in the plant, but the suppliers. Most of them didn't have plants in the U.S. but shipp...
by ourbrooks
Sun May 03, 2015 11:46 am
Forum: Investing - Help with Personal Investments
Topic: Is there any stable value funds that returns ~3% outside of a 401k?
Replies: 12
Views: 1893

Re: Is there any stable value funds that returns ~3% outside of a 401k?

You are not likely to find many. A common mechanism for stable value funds is to buy long term bonds and hold them to maturity. They also buy insurance against drop in the value of the principle. The rate they pass on to investors is what's left after paying for the insurance and, of course, taking ...
by ourbrooks
Mon Apr 27, 2015 5:24 pm
Forum: Investing - Theory, News & General
Topic: Pfau, Kitces, & Target-Date Fund glide paths
Replies: 29
Views: 2790

Re: Pfau, Kitces, & Target-Date Fund glide paths

An alternate view of the Pfau/Kitches approach is that it is a "bonds first" spending strategy. The real risk to portfolio longevity is large negative returns early in retirement; negative returns mean that you will be spending money which would otherwise provide future income. That's what...
by ourbrooks
Fri Apr 24, 2015 3:13 pm
Forum: Investing - Help with Personal Investments
Topic: Recommended stock to bond ratio??
Replies: 15
Views: 1822

Re: Recommended stock to bond ratio??

First, those Morningstar charts are nonsense. If go to the Morningstar site and read the actual article, you discover that there's really nothing behind the curves. They're just things that "retirees might want to consider." Get the latest issue of the Journal of the American Association o...
by ourbrooks
Fri Apr 24, 2015 2:56 pm
Forum: Investing - Theory, News & General
Topic: Who follows Age in Bonds
Replies: 62
Views: 5339

Re: Who follows Age in Bonds

Get yourself a copy of the latest American Association of Individual Investors Journal. It has two articles that look at retirement withdrawals with two different analyses. Both articles included "age in bonds." In both articles, "age in bonds" was better than all cash or all bon...
by ourbrooks
Tue Apr 21, 2015 5:16 pm
Forum: Investing - Theory, News & General
Topic: Retirees: What is your SWR in retirement?
Replies: 45
Views: 4277

Re: Retirees: What is your SWR in retirement?

We'll start out at under 2% but every five years there'll be blip which may send the real rate for that year soaring to 5-6%. Why this curious pattern? Well, I've got several fixed pensions whose purchasing power will drop over time. To compensate for this, every five years or so, I plan to purchase...
by ourbrooks
Sat Apr 18, 2015 8:07 pm
Forum: Personal Consumer Issues
Topic: New HVAC
Replies: 21
Views: 1689

Re: New HVAC

The big issue for me would be the reliability of the existing air conditioning unit. If you need to replace an air conditioning unit in the middle of a southern summer, you'll probably have to stay in a motel for a couple of weeks, while you're getting quotes, and you'll have to wait for them to put...
by ourbrooks
Sat Apr 18, 2015 7:58 pm
Forum: Personal Finance (Not Investing)
Topic: Retirement Budgeting
Replies: 9
Views: 1560

Re: Retirement Budgeting

You could, of course, do things the other way around and start out with how much you can afford to spend each year. That's probably the closest you'll come to a hard number. Your largest expenses, travel and rent, are both things you can be very flexible about. Suppose that travel turns out to be mo...
by ourbrooks
Fri Apr 17, 2015 4:09 pm
Forum: Personal Consumer Issues
Topic: Home stereo system conversion to digital
Replies: 27
Views: 2070

Re: Home stereo system conversion to digital

If you only want to listen to your music at one location, consider the following: Android tablet of your choice which supports an external thumb drive, on which you have your digitized music. Alternately, a couple of flash memory cards. There are players which support FLAC as well as MP3. They also ...
by ourbrooks
Thu Apr 16, 2015 6:37 pm
Forum: Personal Consumer Issues
Topic: Proof vinyl has higher music ceiling than mp3?
Replies: 36
Views: 2831

Re: Proof vinyl has higher music ceiling than mp3?

There are actually three different alternatives to consider: 1. Analog vinyl. 2. CDs, normally encoded in a format (.wav) sampled at 44 Khz per channel (22,000 Hz maximum frequency) 3. MP3 encoding MP3 encoding starts with some higher frequency format and then compresses it. The compression is lossy...
by ourbrooks
Wed Apr 15, 2015 8:03 pm
Forum: Investing - Help with Personal Investments
Topic: Count Pension + SS as part of the Bond portion of AA?
Replies: 31
Views: 2296

Re: Count Pension + SS as part of the Bond portion of AA?

If your mom is single, then $20,000 in Social Security has a present value of around $350,000... No it doesn't. If she passes away in the next year, how much does this SS entitlement add to her estate? That's right, ZERO... Here's the definition of present value: In economics, present value, also k...
by ourbrooks
Wed Apr 15, 2015 6:07 pm
Forum: Investing - Help with Personal Investments
Topic: Count Pension + SS as part of the Bond portion of AA?
Replies: 31
Views: 2296

Re: Count Pension + SS as part of the Bond portion of AA?

If your mom is single, then $20,000 in Social Security has a present value of around $350,000. With $300,000 in her IRA, this means to be "age in bonds" overall, she will have to hold $227,500 in stocks in her IRA. In other words, her IRA will have to be 76% stocks. Would she be comfortabl...
by ourbrooks
Wed Apr 15, 2015 5:27 pm
Forum: Personal Finance (Not Investing)
Topic: Inexpensive Smartphone
Replies: 46
Views: 4603

Re: Inexpensive Smartphone

Uh, how about $19.84 for the phone itself? Walmart periodically has the ZTE Zinger phone for that price, including a T Mobile SIM card. It runs Android 4.4 and does Google Maps, etc. but otherwise is a very low end phone. I bought one, made sure it works, and then put it on the shelf as backup in ca...
by ourbrooks
Wed Apr 15, 2015 5:19 pm
Forum: Investing - Theory, News & General
Topic: [retired guy said] terrible crash is coming
Replies: 71
Views: 8987

Re: [retired guy said] terrible crash is coming

The EMH says that the market uses all available information in determining the price of an asset. Nowhere does it say that the "information" be correct, merely that it be believed to be correct by those participating in the market. Suppose you and everyone else who trades stocks hears from...
by ourbrooks
Tue Apr 14, 2015 8:08 pm
Forum: Personal Finance (Not Investing)
Topic: How do you value a pension?
Replies: 18
Views: 1737

Re: How do you valuate a pension?

Actually, there are well known actuarial techniques for computing the present value of a life annuity, which is what a pension is. You don't have to make any assumption about how long the pension will be paid for; instead, the calculation uses mortality tables. Here's a link to a calculator which do...

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