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Re: Livesoft can you explain how u can do this?

Since this thread is getting some eyeballs, I think it is appropriate to also put this link in it: New article today [11/2014] from Michael Kitces about this whole 0% tax rate thing. He has explained a lot of things in his article, so I link the article to extend the discussion: https://www.kitces....
by retiredjg
Thu Nov 27, 2014 10:56 am
 
Forum: Investing - Help with Personal Investments
Topic: Livesoft can you explain how u can do this?
Replies: 47
Views: 3812

Re: Livesoft can you explain how u can do this?

JLJL wrote:
retiredjg wrote:Can't believe I missed that....

Yeah jg I had a chance yesterday but realized I have nothing to sell.

What are you guys talking about? Obviously I'm missing something fun.
by retiredjg
Thu Nov 27, 2014 10:54 am
 
Forum: Investing - Help with Personal Investments
Topic: Livesoft can you explain how u can do this?
Replies: 47
Views: 3812

Re: Livesoft can you explain how u can do this?

Can't believe I missed that....
by retiredjg
Thu Nov 27, 2014 9:21 am
 
Forum: Investing - Help with Personal Investments
Topic: Livesoft can you explain how u can do this?
Replies: 47
Views: 3812

Re: Livesoft can you explain how u can do this?

retiredjg, it is not just a question of what the IRS allows you to do. It is also a question of what your employer's 401k plan documents allow you to do. An employer plan can choose to require RMDs earlier than the IRS does. As I understand it, most employer plan docs state that RMDs must be taken ...
by retiredjg
Thu Nov 27, 2014 8:48 am
 
Forum: Investing - Help with Personal Investments
Topic: Livesoft can you explain how u can do this?
Replies: 47
Views: 3812

Re: Livesoft can you explain how u can do this?

Thanks for the education! I've edited my post above.
by retiredjg
Thu Nov 27, 2014 7:19 am
 
Forum: Investing - Help with Personal Investments
Topic: Livesoft can you explain how u can do this?
Replies: 47
Views: 3812

Re: Livesoft can you explain how u can do this?

EmergDoc wrote:Some taxpayers are completely phased out of any exemptions, no?

Are they?
by retiredjg
Wed Nov 26, 2014 8:45 pm
 
Forum: Investing - Help with Personal Investments
Topic: Livesoft can you explain how u can do this?
Replies: 47
Views: 3812

Re: Livesoft can you explain how u can do this?

What is the 0% tax bracket? I thought you start paying 10% tax on any income from $0 to $8925. It's not really a bracket, but that seems to be the best term to fit it. It is the amount of money that is never taxed - each taxpayer is allowed at least one exemption (edit: phased out at higher income ...
by retiredjg
Wed Nov 26, 2014 5:35 pm
 
Forum: Investing - Help with Personal Investments
Topic: Livesoft can you explain how u can do this?
Replies: 47
Views: 3812

Re: Parcial transfer from Rollover IRA to Roth

Agreed. The $73,801 number is your taxable income, not AGI...so you are subtracting apples from oranges is that other number is really an AGI. However it works out, that is a tiny nuisance slice of your portfolio. If you convert it all and some slops over into the 25% bracket you'll pay 10% "ex...
by retiredjg
Wed Nov 26, 2014 5:31 pm
 
Forum: Investing - Help with Personal Investments
Topic: Partial transfer from Rollover IRA to Roth
Replies: 4
Views: 318

Re: Livesoft can you explain how u can do this?

I think I was unclear. I think it said you don't have to take RMDs from any 401k until you retire, not just your current one. However, I didn't spend a lot of time looking at small print. It might be just the current one that is exempt. Either way, it is something I didn't know before!
by retiredjg
Wed Nov 26, 2014 5:12 pm
 
Forum: Investing - Help with Personal Investments
Topic: Livesoft can you explain how u can do this?
Replies: 47
Views: 3812

Re: Stuck with an active high ER fund! SHOULD I SELL??

Value: 35,873.30 Cost: 25,125.97 Gain: 10,747.33 This does not take into account that some dividends will have been taxed along the way. I'm thinking your real gain is less than $10,747.33. ER: 1.78% Seems like you are paying an extra $500 or more a year in the expense ratio. I think I'd prefer to ...
by retiredjg
Wed Nov 26, 2014 5:08 pm
 
Forum: Investing - Help with Personal Investments
Topic: Stuck with an active high ER fund! Should I sell ??
Replies: 9
Views: 561

Re: Traditional 401k vs Roth 401k / Traditional IRA vs Roth

Should I use a Roth 401k or roth IRA this year to take advantage of my lower tax bracket this year? Isn't it too lake to make that decision? Most of your contributions should already be in the 401k. Roth IRA should be out of the question as long as you still have that IRA sitting around. 2) My afte...
by retiredjg
Wed Nov 26, 2014 4:52 pm
 
Forum: Investing - Help with Personal Investments
Topic: Traditional 401k vs Roth 401k / Traditional IRA vs Roth IRA
Replies: 7
Views: 666

Re: Livesoft can you explain how u can do this?

I have two pensions and full SS and RMDs will kick in when I retire at 75 - well maybe. I think your RMDs will kick in at 70.5 whether you are retired or not. Or did I misunderstand? Or is it maybe a typo? RMDs on IRAs and former employer plans (401ks, 403bs, etc.) kick in at 70.5 whether you are r...
by retiredjg
Wed Nov 26, 2014 4:17 pm
 
Forum: Investing - Help with Personal Investments
Topic: Livesoft can you explain how u can do this?
Replies: 47
Views: 3812

Re: Does investing in a 401k actually save any money?

It still seems like there is not a definite answer of (non-matching) 401k vs (a very disciplined) Individual. As someone who has worked overseas for about 7/15 years...Ive had to struggle with the question of retirement, since I make too much for a Roth and foreign companies do not offer 401k. Soun...
by retiredjg
Wed Nov 26, 2014 4:07 pm
 
Forum: Investing - Theory, News & General
Topic: Does investing in a 401k actually save any money?
Replies: 61
Views: 5422

Re: Does investing in a 401k actually save any money?

Captain_Andrew wrote:I'm guessing if my income is US Federal income tax free I would want a Roth 401k? (I can't say with any certainty if it will be or not but there's a good chance.)

If military, you'd probably want to use the Roth TSP. If not military, it would depend on your circumstances.
by retiredjg
Wed Nov 26, 2014 4:05 pm
 
Forum: Investing - Theory, News & General
Topic: Does investing in a 401k actually save any money?
Replies: 61
Views: 5422

Re: Backdoor Roth IRA questions

I've come to the conclusion that people who will be in your situation for a lifetime should not defer taxes at all during the early years (internship, residency, fellowship), for just the reasons you are looking at right now. I don't think either choice would be a mistake. And even if it is a mistak...
by retiredjg
Wed Nov 26, 2014 4:03 pm
 
Forum: Investing - Help with Personal Investments
Topic: Backdoor Roth IRA questions
Replies: 5
Views: 400

Re: Asset allocation and various questions

People have varying opinions on what should go into Roth. Some say stocks. Others want bonds. Some want a combination. With your choices, either approach should be easy.
by retiredjg
Wed Nov 26, 2014 3:18 pm
 
Forum: Investing - Help with Personal Investments
Topic: Asset allocation and various questions
Replies: 24
Views: 1363

Re: Regular or Roth 401k after job change?

I've been debating something similar to this. I expect to leave my current company in a year or two, at which point I'll have ~ $100,000 in my 401k and at that point 25 years until the soonest I could use the money without penalty. The company I'm hoping to join offers Roth or regular 401k, should ...
by retiredjg
Wed Nov 26, 2014 3:13 pm
 
Forum: Investing - Theory, News & General
Topic: Does investing in a 401k actually save any money?
Replies: 61
Views: 5422

Re: Livesoft can you explain how u can do this?

Lynette wrote: I have two pensions and full SS and RMDs will kick in when I retire at 75 - well maybe.

I think your RMDs will kick in at 70.5 whether you are retired or not. Or did I misunderstand? Or is it maybe a typo?
by retiredjg
Wed Nov 26, 2014 3:09 pm
 
Forum: Investing - Help with Personal Investments
Topic: Livesoft can you explain how u can do this?
Replies: 47
Views: 3812

Re: Livesoft can you explain how u can do this?

I currently have about 230k in T-IRA and about 230k in Roth-IRA so about 50/50. I can grab a CORP pension at 55 B-Day and Military pension at 59, then plan on taking SS at 62 and invest what I can not spend fast enough. I am 51 now. I have a feeling this involves tax brackets and timing this right....
by retiredjg
Wed Nov 26, 2014 2:24 pm
 
Forum: Investing - Help with Personal Investments
Topic: Livesoft can you explain how u can do this?
Replies: 47
Views: 3812

Re: Backdoor Roth IRA questions

Just so you will know, there is no such thing as a "back door Roth". Sometimes people use that terminology, but a Roth IRA is a Roth IRA. It is the contribution that can go in directly or through a back door. An estimate...if none of the money in the tIRAs has been taxed yet, you will owe ...
by retiredjg
Wed Nov 26, 2014 2:20 pm
 
Forum: Investing - Help with Personal Investments
Topic: Backdoor Roth IRA questions
Replies: 5
Views: 400

Re: Asset allocation and various questions

I don't know exactly what happens to Roth 401k. Maybe somebody else will.
by retiredjg
Wed Nov 26, 2014 1:59 pm
 
Forum: Investing - Help with Personal Investments
Topic: Asset allocation and various questions
Replies: 24
Views: 1363

Re: Monthly Investment Plan & 10K immediate investment

It is difficult to give a reasonable answer since we don't know what you already have. If you want a real answer, I'd suggest you post all your information in the format suggested at the end of this message. If you just want a reasonable guess, a tax-efficient stock index fund like total stock index...
by retiredjg
Wed Nov 26, 2014 1:57 pm
 
Forum: Investing - Help with Personal Investments
Topic: Monthly Investment Plan & 10K immediate investment
Replies: 1
Views: 155

Re: Help: Three Fund Portfolio at Fidelity

placeholder wrote:
livesoft wrote:INevertheless, they are still nearly identical.

But are they SUBSTANTIALLY identical?

Nobody knows. :twisted:
by retiredjg
Wed Nov 26, 2014 1:02 pm
 
Forum: Investing - Theory, News & General
Topic: Help: Three Fund Portfolio at Fidelity
Replies: 36
Views: 2992

Re: Asset allocation and various questions

Well, tell her if you get incapacitated or dead, she can move everything to Vanguard and have them manage it for .3%. There are also some advisors who are in the same ballpark - some of them post here. Just keep an eye out for names.
by retiredjg
Wed Nov 26, 2014 11:22 am
 
Forum: Investing - Help with Personal Investments
Topic: Asset allocation and various questions
Replies: 24
Views: 1363

Re: Bonds for the IRA

I don't recall that he said anything other than "more corporates" to go along with total bond. If you go to the Vanguard fund list and select bonds, you'll see several under the heading of "investment grade". I needed a little slice of bonds in an account and used Intermediate Te...
by retiredjg
Wed Nov 26, 2014 10:41 am
 
Forum: Investing - Help with Personal Investments
Topic: Bonds for the IRA
Replies: 3
Views: 441

Re: Help: Three Fund Portfolio at Fidelity

I think there is no meaningful difference between the Spartan Total Stock and the Vanguard Total Stock. I also think there is no meaningful difference in performance between the Spartan Global Except US Fund and the Vanguard Total International. However, some people have a distinct philosophical pr...
by retiredjg
Wed Nov 26, 2014 9:54 am
 
Forum: Investing - Theory, News & General
Topic: Help: Three Fund Portfolio at Fidelity
Replies: 36
Views: 2992

Re: Asset allocation and various questions

One way people here use is to imagine the loss of half your stock value in a crash. There is nothing saying the market can't crash beyond 50%, but 40 or 50% is typical of a good crash. So if your 45% of your portfolio disappeared (90% stock portfolio), would you be comfortable? What about 40%? If th...
by retiredjg
Wed Nov 26, 2014 9:50 am
 
Forum: Investing - Help with Personal Investments
Topic: Asset allocation and various questions
Replies: 24
Views: 1363

Re: Asset allocation and various questions

I think your plan is reasonable (even though I still believe you should be maxing your tax-deferrments because of your high tax bracket). There is no need to hold every asset class in every account. It does not hurt anything and the funds don't care, but you don't need to do it. The corporate, inter...
by retiredjg
Wed Nov 26, 2014 8:17 am
 
Forum: Investing - Help with Personal Investments
Topic: Asset allocation and various questions
Replies: 24
Views: 1363

Re: Help: Three Fund Portfolio at Fidelity

I think there is no meaningful difference between the Spartan Total Stock and the Vanguard Total Stock. I also think there is no meaningful difference in performance between the Spartan Global Except US Fund and the Vanguard Total International. However, some people have a distinct philosophical pre...
by retiredjg
Wed Nov 26, 2014 7:56 am
 
Forum: Investing - Theory, News & General
Topic: Help: Three Fund Portfolio at Fidelity
Replies: 36
Views: 2992

Re: Porfolio review, consolidation needed

Do you actually need anything other than "very very basic"? Bells and whistles are nice, but how much are they needed for what you need to do? There's one argument for using one of the other plans and that is if your employer ever changes plans, at least you'll have a good portion of your ...
by retiredjg
Tue Nov 25, 2014 9:04 pm
 
Forum: Investing - Help with Personal Investments
Topic: Porfolio review, consolidation needed
Replies: 15
Views: 1101

Re: Porfolio review, consolidation needed

Ok. This is interesting. I thought you could only roll a previous 401K into your current employer 401K. If an older 401K allows for a roll in then I missed it. The believe the 3 Fidelity and 1 Schwab previous 401Ks are all good options to consider. In the event I could roll in to any of them this w...
by retiredjg
Tue Nov 25, 2014 7:54 pm
 
Forum: Investing - Help with Personal Investments
Topic: Porfolio review, consolidation needed
Replies: 15
Views: 1101

Re: Pre tax vs after tax contribution spread--what to do

(Note that I edited my allocations above--I realized after a bit more poking around that I don't need to use the higher-expense VT fund; I can break things down further in my retirement accounts without overlapping the indices at betterment.) If you want people to comment about your portfolio idea,...
by retiredjg
Tue Nov 25, 2014 7:51 pm
 
Forum: Investing - Help with Personal Investments
Topic: Asset allocation and various questions
Replies: 24
Views: 1363

Re: Pre tax vs after tax contribution spread--what to do

May I ask why backdoor roth IRAs are preferable to in-plan conversions to the Roth 401k? (I tend to prefer my 401k when possible as I have a very good plan with insanely low expense-ratio funds available. Lower than the corresponding ETFs. (Further, due to using betterment and hoping to get some be...
by retiredjg
Tue Nov 25, 2014 6:31 pm
 
Forum: Investing - Help with Personal Investments
Topic: Asset allocation and various questions
Replies: 24
Views: 1363

Re: Porfolio review, consolidation needed

My reasoning on holding same fund in multiple 401Ks is only toi keep them out of rolloever tIRA. Also, I am not all that impressed with current 401K at MassMutual. I am still working to identify any management fees in my Fidelity and Schwab orphan 401Ks. If I do find fees I will consider rolling in...
by retiredjg
Tue Nov 25, 2014 6:20 pm
 
Forum: Investing - Help with Personal Investments
Topic: Porfolio review, consolidation needed
Replies: 15
Views: 1101

Re: Pre tax vs after tax contribution spread--what to do

In the 33% tax bracket, I think you should do this: $17,500 to His pre-tax 401k $17,500 to Her pre-tax 403b $5,500 to His Roth IRA (back door) $5,500 to Her Roth IRA (back door) anything else into taxable or after-tax in the 401k - either converted to Roth 401k regularly or rolled out to Roth IRA re...
by retiredjg
Tue Nov 25, 2014 5:00 pm
 
Forum: Investing - Help with Personal Investments
Topic: Asset allocation and various questions
Replies: 24
Views: 1363

Re: 401k Get off Target Year Fund with high expense ratio

The allocation is reasonable and that split of 500 and Russell 2000 is about as close as you will get to total stock market. You are not missing mid-caps by any means, but the amount of mid caps is a little lower than TSM and the amount of small caps is a little higher. I don't think it is enough to...
by retiredjg
Tue Nov 25, 2014 4:02 pm
 
Forum: Investing - Help with Personal Investments
Topic: 401k Get off Target Year Fund with high expense ratio
Replies: 4
Views: 350

Re: [Merged Post]

One thing I'm unclear on though. Up until a few weeks ago I was working with a financial planner/investment manager. They are the ones who pointed out this mega-backdoor opportunity. So far, you have described a couple of things, but neither is the "mega back door" (at least as far as the...
by retiredjg
Tue Nov 25, 2014 3:27 pm
 
Forum: Investing - Help with Personal Investments
Topic: Asset allocation and various questions
Replies: 24
Views: 1363

Re: Pre tax vs after tax contribution spread--what to do

- If we backdoor roth in the year that the rollover tIRA existed (tax year 2014), will that cause a pro-rata tax? Or no since at the end of the tax year that amount was no longer in a tIRA? If there is nothing in that person's IRA (including SEP IRA and SIMPLE IRA) on 12/31, nothing gets prorated. ...
by retiredjg
Tue Nov 25, 2014 3:19 pm
 
Forum: Investing - Help with Personal Investments
Topic: Asset allocation and various questions
Replies: 24
Views: 1363

Re: Pre tax vs after tax contribution spread--what to do

The first thing you need to do is get a handle on your actual current tax brackets. There is no 39% or 38.2% bracket, so maybe you are adding in state tax or something. Compare your taxable income from last year (line 43 on Form 1040) to this chart, making sure you click the right year and the right...
by retiredjg
Tue Nov 25, 2014 3:09 pm
 
Forum: Investing - Help with Personal Investments
Topic: Asset allocation and various questions
Replies: 24
Views: 1363

Re: Porfolio review, consolidation needed

5. Start backdoor contributions to Roth accounts. (2015) It may be a year before you do the taxes on this. Write yourself a note for the following spring that you didn't contribute to Roth IRA. You did two steps and it has to be reported that way. Contribute to tIRA, do not deduct, convert to Roth....
by retiredjg
Tue Nov 25, 2014 2:41 pm
 
Forum: Investing - Help with Personal Investments
Topic: Porfolio review, consolidation needed
Replies: 15
Views: 1101

Re: Questions about implementing 'mega backdoor roth'

Yes, it does make sense that both the back door and the mega back door would reach their 5 year clock at the same time, if converted in the same calender year. To this end, I would also assume that all pre-conversion earnings (back door + mega back door) would need to come out before any after-tax ...
by retiredjg
Tue Nov 25, 2014 6:31 am
 
Forum: Investing - Help with Personal Investments
Topic: Questions about implementing 'mega backdoor roth'
Replies: 29
Views: 2072

Re: Roth IRA for my fun money

I don't have fun money, but if I did...it would definitely not be in Roth space. Getting money into Roth status is valuable and most people simply "can't get enough". Do not gamble with that space. Gamble in a taxable account and just don't sell anything that is a short term gain unless yo...
by retiredjg
Mon Nov 24, 2014 6:23 pm
 
Forum: Investing - Help with Personal Investments
Topic: Roth IRA for my fun money
Replies: 5
Views: 597

Re: Approximating total stock market

I assume (but do not know) that Vanguard is using the CRSP definitions for size. Regardless of whether that is correct or not, different index makers and possibly different custodians classify size in different ways. So if you use more than one system to compare things, you end up with apples and or...
by retiredjg
Mon Nov 24, 2014 6:04 pm
 
Forum: Investing - Theory, News & General
Topic: Approximating total stock market
Replies: 3
Views: 448

Re: Thank you and see you later

Have a great trip! I predict that you won't miss computer time too much.
by retiredjg
Mon Nov 24, 2014 5:00 pm
 
Forum: Investing - Theory, News & General
Topic: Thank you and see you later
Replies: 1
Views: 746

Re: I think I'm missing something about the backdoor roth

My concern here is whether the rollover can be accomplished by 12/31. Things just slow down from Thanksgiving to New years. Missing the 12/31 deadline would mess up the whole thing if our poster has already done the conversion. It could be fixed, but you'd have to do a re-characterization. So starti...
by retiredjg
Mon Nov 24, 2014 4:46 pm
 
Forum: Investing - Help with Personal Investments
Topic: I think I'm missing something about the backdoor roth
Replies: 21
Views: 1578

Re: New to Vanguard and serious about retirement planning

Welcome! You've done well and now will enjoy the fruits. I had to laugh at your first paragraph - everybody tried to sell you something....except VG. It is so true. 1. We feel the 60/40 mix is right for us. Does the recommended allocation adequately diversify? Yes. 2. Should we include a REIT compon...
by retiredjg
Mon Nov 24, 2014 4:33 pm
 
Forum: Investing - Help with Personal Investments
Topic: New to Vanguard and serious about retirement planning
Replies: 12
Views: 1370

Re: Backdoor Roth Question

I can't help with part of your question, but unless things have changed, a Vanguard individual 401k will not accept a rollover from an IRA. They will accept a rollover from a 401k plan. If this is important to you, consider opening your individual 401k at Fidelity. I would start being worried about ...
by retiredjg
Mon Nov 24, 2014 4:07 pm
 
Forum: Investing - Help with Personal Investments
Topic: Backdoor Roth Question
Replies: 7
Views: 495

Re: Questions about implementing 'mega backdoor roth'

I wasn't considering pre-conversion earnings to be the same grouping as post-conversion earnings, however I didn't realize the ordering rules prevented access to the contributions unless the penalty is paid on the pre-conversion earnings that came in the same rollover. Thanks much for pointing out ...
by retiredjg
Mon Nov 24, 2014 3:58 pm
 
Forum: Investing - Help with Personal Investments
Topic: Questions about implementing 'mega backdoor roth'
Replies: 29
Views: 2072
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