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Re: Student Loan vs 401k dilemma

It makes no sense to me to be saving for education while you have a loan for education outstanding. It makes no sense to me to pay extra on the mortgage before you have filled all (or at least more) of your tax-advantaged space. I completely opposite to this. IMO, it makes no since to pay down a mo...
by retiredjg
Sat Sep 20, 2014 7:48 pm
 
Forum: Investing - Help with Personal Investments
Topic: Student Loan vs 401k dilemma
Replies: 11
Views: 496

Re: Backdoor Roth Step By Step

Thanks retiredjg, this makes a lot of sense, would the Prime Money Market (VMMXX) work? Yes, that would work great. The money will only be there a very short while - once the conversion is done, invest in whatever you want. Here's more information if you have not seen this already. http://thefinanc...
by retiredjg
Sat Sep 20, 2014 6:56 pm
 
Forum: Investing - Help with Personal Investments
Topic: Backdoor Roth Step By Step
Replies: 6
Views: 321

Re: Backdoor Roth Step By Step

Some people do the conversion the next day. Many suggest the money should initially be invested in money market which makes it easy to convert the exact amount you contributed (no earnings or losses to account for). Do your paperwork - Form 8606. Remember to report what you did (don't report that yo...
by retiredjg
Sat Sep 20, 2014 5:55 pm
 
Forum: Investing - Help with Personal Investments
Topic: Backdoor Roth Step By Step
Replies: 6
Views: 321

Re: Regular vs Roth 401k?

If she is single with no dependents, she is probably in the 25% tax bracket. However, her contributions to traditional 401k may be bringing her down into the 15% bracket. My thinking is traditional for the 25% bracket and Roth for the 15% bracket. For this scenario, I'm thinking she might want to us...
by retiredjg
Sat Sep 20, 2014 5:00 pm
 
Forum: Investing - Help with Personal Investments
Topic: Regular vs Roth 401k?
Replies: 5
Views: 333

Re: Student Loan vs 401k dilemma

It makes no sense to me to be saving for education while you have a loan for education outstanding.

It makes no sense to me to pay extra on the mortgage before you have filled all (or at least more) of your tax-advantaged space.
by retiredjg
Sat Sep 20, 2014 4:54 pm
 
Forum: Investing - Help with Personal Investments
Topic: Student Loan vs 401k dilemma
Replies: 11
Views: 496

Re: 401k rollover

I see there is another question. 401k money is available if you retire in or after the year in which you reach 55 (as long as the money is in the 401k). IRA money is available at 59.5. There is a way around that 59.5 though.
by retiredjg
Sat Sep 20, 2014 2:48 pm
 
Forum: Investing - Help with Personal Investments
Topic: 401k rollover
Replies: 3
Views: 164

Re: 401k rollover

As long as the money stays in either a 401k (403b, etc) or an iRA, there are no taxes. If the money is rolled to a Roth IRA (not suggested) there will be taxes. The only downside to rolling to an IRA is that it may interfere with her ability to use the back door contribution to Roth IRA. If that is ...
by retiredjg
Sat Sep 20, 2014 2:46 pm
 
Forum: Investing - Help with Personal Investments
Topic: 401k rollover
Replies: 3
Views: 164

Re: Total bond index or 5 yr CD?

mpt follower wrote:Please educate me, why would you not get the CD?

I wouldn't get the CD because I'm too lazy to move the money. But I don't see any reason not to use the CD if you want. Many people here have been using CDs instead of bonds for awhile.
by retiredjg
Sat Sep 20, 2014 2:40 pm
 
Forum: Investing - Help with Personal Investments
Topic: Total bond index or 5 yr CD?
Replies: 14
Views: 913

Re: Portfolio & Strategy Checkup

Current household income: about 83,000/year It is possible this puts you into the 15% tax bracket. You need to figure that out because it might mean you get a tax benefit if you sell the e-trade account. Compare your taxable income (line 43 on Form 1040) to this chart. http://www.moneychimp.com/fea...
by retiredjg
Sat Sep 20, 2014 2:18 pm
 
Forum: Investing - Help with Personal Investments
Topic: Portfolio & Strategy Checkup
Replies: 2
Views: 225

Re: please take a look at my 'gone fishing' portfolio and ra

I am going to try to take your suggestion and simplify my plan. I will reduce everything to a 4 fund portfolio , keeping the small caps. I currently have my bonds at 25% and you are suggesting 30%. I can do this too. And, I will try to leave it alone for weeks, months , and years, this is what I re...
by retiredjg
Sat Sep 20, 2014 10:26 am
 
Forum: Investing - Help with Personal Investments
Topic: please take a look at my 'gone fishing' portfolio and rate
Replies: 22
Views: 1532

Re: Tax Efficiency of Taxable Investments

Thanks for the response. It does bring up more questions though. Compare your taxable income, line 43 on your Form 1040, to this chart. http://www.moneychimp.com/features/tax_brackets.htm If you use a different form, find the line that says "taxable income" and use that. Be sure you select...
by retiredjg
Sat Sep 20, 2014 10:07 am
 
Forum: Investing - Help with Personal Investments
Topic: Tax Efficiency of Taxable Investments
Replies: 12
Views: 1566

Re: Rebalancing questions / Should I change the complexity?

Yep, the thought was more along the lines of "Hmm, I'm paying more for things I don't want." That makes sense. It would be easier if I could automatically split my contributions up based on the holdings in the account, but I guess that would mean my employer would have to know exactly wha...
by retiredjg
Fri Sep 19, 2014 7:37 pm
 
Forum: Investing - Help with Personal Investments
Topic: Rebalancing questions / Should I change the complexity?
Replies: 6
Views: 350

Re: Rebalancing questions / Should I change the complexity?

I would not do anything for 7bp. That is negligible in my opinion. If you change, it should be because you are more comfortable with a different investment(s). Rebalancing can be done once a year or every two years. Or whenever your desired ratio is out of balance by something like 5% (you decide th...
by retiredjg
Fri Sep 19, 2014 7:02 pm
 
Forum: Investing - Help with Personal Investments
Topic: Rebalancing questions / Should I change the complexity?
Replies: 6
Views: 350

Re: How to achieve a balance between "saving" and "living"?!

Starting very young (like early 20's) means you will get to your retirement goal faster. Saving a lot (like you do) means you will get to your retirement goal faster. I could not prove it, but I think you can back off the retirement savings a little and save some for your motorcycles and traveling. ...
by retiredjg
Fri Sep 19, 2014 6:14 pm
 
Forum: Personal Consumer Issues
Topic: How to achieve a balance between "saving" and "living"?!
Replies: 30
Views: 2206

Re: Question about exchanging one Vanguard fund for another

If I were to exchange some shares of Vanguards bond fund for shares of total stock fund are there any tax related problems I should be considering? Also is there a limit to how often I could exchange and would I run into any special fees/problems? This is in a non retirement account. If the money i...
by retiredjg
Fri Sep 19, 2014 6:04 pm
 
Forum: Investing - Help with Personal Investments
Topic: Question about exchanging one Vanguard fund for another
Replies: 1
Views: 294

Re: The Mega Backdoor Roth IRA

The following is a copy of Sec 72(d)(2): (2) Treatment of employee contributions under defined contribution plans For purposes of this section, employee contributions (and any income allocable thereto) under a defined contribution plan may be treated as a separate contract. I think it is worth ment...
by retiredjg
Fri Sep 19, 2014 4:39 pm
 
Forum: Personal Finance (Not Investing)
Topic: The Mega Backdoor Roth IRA
Replies: 144
Views: 20901

Re: please take a look at my 'gone fishing' portfolio and ra

a few minor changes.... Stocks 75%/ Bonds 25% VTSAX Vanguard Total Stock market Admiral, and TSP C/S funds - 36% changed to 45% VSIAX Vanguard Small Cap Value Fund Admiral - 11% changed to 10% VTIAX Vanguard Total International Stock Market Index Admiral - 12% Changed to 10% *VEMAX Vanguard Emergin...
by retiredjg
Fri Sep 19, 2014 4:31 pm
 
Forum: Investing - Help with Personal Investments
Topic: please take a look at my 'gone fishing' portfolio and rate
Replies: 22
Views: 1532

Re: please take a look at my 'gone fishing' portfolio and ra

Thanks for the info on the Emerging Markets. I guess I can keep them to complement my international allocation which is just 12% currently. I would have 17% total international. The Vanguard Total International Index that you hold already contains emerging markets. You don't "need" any ex...
by retiredjg
Fri Sep 19, 2014 3:53 pm
 
Forum: Investing - Help with Personal Investments
Topic: please take a look at my 'gone fishing' portfolio and rate
Replies: 22
Views: 1532

Re: IRS Relents! Notice 2014-54 permits Basis Isolation

I'd like to mention, for the benefit of newer people following this thread, that an after-tax contribution is not the same thing as a contribution to Roth 401k (even though Roth 401k money is after tax). So if you have be scratching your head wondering what in the heck are these crazy people talking...
by retiredjg
Fri Sep 19, 2014 3:38 pm
 
Forum: Personal Finance (Not Investing)
Topic: IRS Relents! Notice 2014-54 permits Basis Isolation
Replies: 16
Views: 2102

Re: Defined Benefit Plan and AA

EvilHomer wrote:Should we take the expected value at retirement age and include it as part of our Bonds?

BTW, I would definitely NOT do this one. Expected value later mixed in with current value now is just all wrong in my opinion.
by retiredjg
Fri Sep 19, 2014 3:30 pm
 
Forum: Investing - Help with Personal Investments
Topic: Defined Benefit Plan and AA
Replies: 8
Views: 360

Re: Defined Benefit Plan and AA

Opinions vary. Some people include the pension, usually as bond but I think I've seen other ways too. Some do not include the pension at all - but see it as an income stream (like SS) that will reduce the amount taken from the nest egg in retirement. Or a lump sum that you will invest at a later tim...
by retiredjg
Fri Sep 19, 2014 3:28 pm
 
Forum: Investing - Help with Personal Investments
Topic: Defined Benefit Plan and AA
Replies: 8
Views: 360

Re: Revising AA, significant difference

We are pretty risk-averse, so it does make sense to adjust our allocation to include more bonds. If you are risk-averse, 16% in bonds is not enough and it is good that you are giving this serious consideration. For a risk averse couple with an average age of 35, I think 30% in bonds is much more re...
by retiredjg
Fri Sep 19, 2014 12:37 pm
 
Forum: Investing - Help with Personal Investments
Topic: Revising AA, significant difference
Replies: 11
Views: 862

Re: Shuffling between TSP, Edward Jones, and Vanguard

You seem unsure about your stock to bond ratio. 70/30 is fine if you are looking to be a little conservative. If you wanted to go to 75/25 or even 80/20, neither of those would be in the stupid range. You should base this decision on how much you are willing to see your portfolio drop during the cra...
by retiredjg
Fri Sep 19, 2014 12:29 pm
 
Forum: Investing - Help with Personal Investments
Topic: Shuffling between TSP, Edward Jones, and Vanguard
Replies: 12
Views: 980

Re: Shuffling between TSP, Edward Jones, and Vanguard

There can be good reasons to use Roth TSP while in the 25% bracket, but it takes a bit of a crystal ball to know what will ultimately have been the better choice. This poster is single and in the 25% bracket. In retirement, if still single, the pension and SS may very well push this poster into the ...
by retiredjg
Fri Sep 19, 2014 12:20 pm
 
Forum: Investing - Help with Personal Investments
Topic: Shuffling between TSP, Edward Jones, and Vanguard
Replies: 12
Views: 980

Re: IRS Relents! Notice 2014-54 permits Basis Isolation

So just to be clear, this means that the mega roth backdoor (post tax 401k --> Roth IRA) is explicitly allowed? I've been hoping that Alan S would address this because I know he can do a better job. But since he hasn't, I'll give my own interpretation. It is my understanding that what has been call...
by retiredjg
Fri Sep 19, 2014 10:27 am
 
Forum: Personal Finance (Not Investing)
Topic: IRS Relents! Notice 2014-54 permits Basis Isolation
Replies: 16
Views: 2102

Re: Invest in Betterment or Bank for 4 years.

What funds at Vanguard require $10,000? Other than a fund in Admiral Shares when there is an Investor Share fund available.... If there are any, they must not be the stuff we ordinarily discuss. Well, I found one. The Managed Payout Fund has a $25k minimum. Everything else was an Admiral Share of s...
by retiredjg
Thu Sep 18, 2014 5:17 pm
 
Forum: Investing - Help with Personal Investments
Topic: Invest in Betterment or Bank for 4 years.
Replies: 9
Views: 577

Re: Invest in Betterment or Bank for 4 years.

What funds at Vanguard require $10,000? Other than a fund in Admiral Shares when there is an Investor Share fund available.... If there are any, they must not be the stuff we ordinarily discuss.
by retiredjg
Thu Sep 18, 2014 5:12 pm
 
Forum: Investing - Help with Personal Investments
Topic: Invest in Betterment or Bank for 4 years.
Replies: 9
Views: 577

Re: I think I need a plan.

Whatever you do, don't mix taxable and non-taxable contributions in the same IRA! This might make things easier to keep track of in your head, but I don't think there is a problem with mixing rollover money with non-deductible contributions to IRA. It all has to be tracked on Form 8606 no matter ho...
by retiredjg
Thu Sep 18, 2014 4:23 pm
 
Forum: Investing - Help with Personal Investments
Topic: I think I need a plan.
Replies: 6
Views: 862

Re: I think I need a plan.

1. What vehicle do i use for the extra savings I want to save. Taxable? Vanguard Variable Annuity? (fees seemed low compared to american funds) Let's figure out what you have. Do you have a SIMPLE IRA or a 401k? You called it 401k first, then kept calling it a SIMLE IRA. I'm assuming it is a SIMPLE...
by retiredjg
Thu Sep 18, 2014 3:29 pm
 
Forum: Investing - Help with Personal Investments
Topic: I think I need a plan.
Replies: 6
Views: 862

Re: SSA Resumes Mailing Social Security Statements

Good to know. I'll have to try again, with my credit report at hand. This may help you. In my case, the credit bureaus had not yet changed things as I moved around so I didn't know whether to give an answer that was correct a few months ago or at the time I was answering the questions. Second time ...
by retiredjg
Thu Sep 18, 2014 1:59 pm
 
Forum: Personal Finance (Not Investing)
Topic: SSA Resumes Mailing Social Security Statements
Replies: 6
Views: 1114

Re: Revising AA, significant difference

- is age in bonds really a good rule of thumb? We also are targeting an earlier retirement date if the pension is around as planned, but would not need the 401k money to do so. Moving to 30% just seems so drastic! Age in bonds is only one of several reasonable rules of thumb. It happens to be the m...
by retiredjg
Thu Sep 18, 2014 8:46 am
 
Forum: Investing - Help with Personal Investments
Topic: Revising AA, significant difference
Replies: 11
Views: 862

Re: Where do I put my cash now?

You are trying to figure out the best time to buy. It's just not possible. In the meantime, your money is sitting on the sidelines. Pick your asset allocation and buy it, no matter what the market is doing. If you can't follow that simple instruction, your asset allocation is not right for you. In 1...
by retiredjg
Wed Sep 17, 2014 4:50 pm
 
Forum: Investing - Help with Personal Investments
Topic: Where do I put my cash now?
Replies: 23
Views: 2499

Re: Impulse Buy vs. Investment Strategy

Risk is not the only thing to consider. You will pay taxes on the earnings from Total Stock and Total Bond. Not saying that is a better choice or a worse choice. Just that risk is not the only thing to consider.
by retiredjg
Wed Sep 17, 2014 4:46 pm
 
Forum: Investing - Help with Personal Investments
Topic: Impulse Buy vs. Investment Strategy
Replies: 5
Views: 496

Re: SSA Resumes Mailing Social Security Statements

I didn't even have to wait 30 days. Seems like it was 1 day or thereabouts.
by retiredjg
Wed Sep 17, 2014 4:42 pm
 
Forum: Personal Finance (Not Investing)
Topic: SSA Resumes Mailing Social Security Statements
Replies: 6
Views: 1114

Re: Bogleheads guide to retirement planning pg 86 question

The book means if all things are equal (or at least close). An ER of 1% should definitely be avoided if you have better choices. And it appears you do have better choices.
by retiredjg
Wed Sep 17, 2014 3:22 pm
 
Forum: Investing - Help with Personal Investments
Topic: Bogleheads guide to retirement planning pg 86 question
Replies: 2
Views: 418

Re: Roth help

Thank you all, you are most helpful. In answer to your question(s) the current TIRA is split into 4 different funds. The plan is to liquidate all of them (1 at a time). The other part that I believe you answered is that even my current American fund is loaded and there is no going around it. Your c...
by retiredjg
Wed Sep 17, 2014 3:16 pm
 
Forum: Investing - Help with Personal Investments
Topic: Roth help
Replies: 14
Views: 564

Re: FutureAdvisor suggested asset allocation

livesoft wrote:*OK, astute readers will realize that I have absolutely no way to substantiate that statement.

That was pretty funny. :happy
by retiredjg
Wed Sep 17, 2014 2:17 pm
 
Forum: Investing - Help with Personal Investments
Topic: FutureAdvisor suggested asset allocation
Replies: 8
Views: 838

Re: FutureAdvisor suggested asset allocation

The suggested allocation is for someone who wants to tilt to small cap and to value. Since you are asking, my guess is that you have no idea what "tilting to small cap and value" means. Since it is not smart to invest blindly, you should not follow that suggestion, at least at this point. ...
by retiredjg
Wed Sep 17, 2014 2:16 pm
 
Forum: Investing - Help with Personal Investments
Topic: FutureAdvisor suggested asset allocation
Replies: 8
Views: 838

Re: Help w/ Wife's Poor 401k Options

I don't know why you think she has poor 401k options. Looks pretty good to me. This type of question can't be answered adequately without seeing the big picture. There may not be any reason to use a 4th fund in that account. Or you might actually have to put a bond fund in there. Nobody can figure t...
by retiredjg
Wed Sep 17, 2014 2:09 pm
 
Forum: Investing - Help with Personal Investments
Topic: Help w/ Wife's Poor 401k Options
Replies: 8
Views: 542

Re: Roth help

Converting a TIRA to Roth doesn't require buying new funds as the current assets can be transferred in kind. I wondered about this myself. But the poster does not say that the old IRA is in the American Fund they want to purchase in the Roth IRA. Doesn't say it isn't either. Based on what the advis...
by retiredjg
Wed Sep 17, 2014 1:59 pm
 
Forum: Investing - Help with Personal Investments
Topic: Roth help
Replies: 14
Views: 564

Re: Roth help

There are different issues brought up in your post. Should she convert to Roth IRA? Maybe, maybe not. If you are in a very low tax bracket, it might be a good plan. If not....more information is needed. Buying American Funds means that you pay a front end load, as mentioned by your advisor. This has...
by retiredjg
Wed Sep 17, 2014 9:17 am
 
Forum: Investing - Help with Personal Investments
Topic: Roth help
Replies: 14
Views: 564

Re: Should I roll over my 58 year old mom's 401k?

The risk does exist. How much of a risk? Anyone's guess is as good as any other guess.

Some plans allow you to roll rollover money out at a later date. Check on that.

If this is a big worry for you, just go with the IRA at Vanguard so that you don't worry about doing the wrong thing.
by retiredjg
Tue Sep 16, 2014 7:57 pm
 
Forum: Investing - Help with Personal Investments
Topic: Should I roll over my 58 year old mom's 401k?
Replies: 19
Views: 816

Re: Should I roll over my 58 year old mom's 401k?

We don't know the expenses in the new 401k, but they are probably better than what you have chosen in the old 401k. The 500 index is good, but the others are not that good - certainly not good enough to stay in that old plan.
by retiredjg
Tue Sep 16, 2014 3:38 pm
 
Forum: Investing - Help with Personal Investments
Topic: Should I roll over my 58 year old mom's 401k?
Replies: 19
Views: 816

Re: Should I roll over my 58 year old mom's 401k?

Couldn't use the links. Are the Vanguard funds actually in her 401k or does she have to use a brokerage window to get them? That could result in extra fees. If there is a Spartan Extended Market Fund available, you could make total stock market by using about 80% 500 index and about 20% Extended Mar...
by retiredjg
Tue Sep 16, 2014 2:51 pm
 
Forum: Investing - Help with Personal Investments
Topic: Should I roll over my 58 year old mom's 401k?
Replies: 19
Views: 816

Re: Should I roll over my 58 year old mom's 401k?

One good reason to leave it in the old 401k is if she should ever need to use the back door approach to contribute to Roth IRA. Of course, the same thing could be accomplished by rolling the old 401k into the new 401k. If she will never need to do this, there is no reason not to roll the old 401k to...
by retiredjg
Tue Sep 16, 2014 1:46 pm
 
Forum: Investing - Help with Personal Investments
Topic: Should I roll over my 58 year old mom's 401k?
Replies: 19
Views: 816

Re: Should I step in to help my in law pay off credit card d

barnaclebob wrote:The problem is she was spending money to unintentionally selfishly keep a pet alive for another few months, its not responsible.

How could you possibly know that? The facts could be entirely different.
by retiredjg
Mon Sep 15, 2014 4:15 pm
 
Forum: Personal Finance (Not Investing)
Topic: Should I step in to help my in law pay off credit card debt
Replies: 31
Views: 2586

Re: Should I step in to help my in law pay off credit card d

It will take a long time and cost a lot of money to pay off CC debt using only minimum payments. It is also not good for you to pay her bills if this will just happen over an over. But yes, sometimes our brains do fall out when we have a pet, so if this is not going to be a reoccurring issue, maybe ...
by retiredjg
Mon Sep 15, 2014 3:58 pm
 
Forum: Personal Finance (Not Investing)
Topic: Should I step in to help my in law pay off credit card debt
Replies: 31
Views: 2586

Re: treating all investment accounts as one pool of money

I think my example just won't work unless you are adding money and keeping the stock to bond ratio near target through the years. But it does show you how you can "sell stocks" in taxable when the net result is actually to "sell bonds" in tax-advantaged without taking money out o...
by retiredjg
Mon Sep 15, 2014 2:08 pm
 
Forum: Investing - Help with Personal Investments
Topic: treating all investment accounts as one pool of money
Replies: 26
Views: 2280
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