Bogleheads.org

When you buy bond fund shares the interest will begin accruing to you on the day following your purchase. A way to remember this is that the shares you receive are determined after the close of the day's trading, thus after the interest has accrued for the day. When a particular bond is purchased, i...

[quote="Epsilon Delta"] These are more complicated than that. The key is that taking an early RMD means you need to make estimated tax payments earlier in the year.[quote] This is not true. You can either pay your current year tax estimates based on your previous year's tax OR pay this yea...

All things being equal, the only thing that matters is your tax rate now versus your future tax rate. Funds taken from deferred accounts are taxed as ordinary income. In the US, the tax rate on ordinary income has almost always been higher than the tax rate on long term capital gains. Over time, mar...

I’ve just finished reading “The Permanent Portfolio”, and I have a few questions and observations: 1. On page 25 the returns of a 60/40 portfolio are compared to the Permanent Portfolio. Was the 60/40 portfolio rebalanced over the time period shown? Also, the book discusses storage, tax, insurance, ...

In a recent thread I noticed what seemed to be confusion about how mutual fund distributions and management fees work. I’ve 14 years’ experience with accounting, compliance, tax prep, shareholder reporting, shareholder distributions, etc. with four 1940 Act Funds, so I thought I’d attempt to shed li...

NAPFA and Garrett Planning Network are good places to start, but broad experience is key and very difficult to find. If you have been very successful ($15m+), then you might want to look into multi-family offices. These tend to be fee-only and offer comprehensive services including tax prep, portfol...

No wash sale, but you should have instructed Vanguard to gift the low-basis shares (or FIFO lot, in this case). Otherwise you could have a problem of gifting the higher basis shares you had just purchased OR cost averaging the shares just purchased with the lower basis shares.

If you want to set aside funds for education, why not a 529? If educational funds are instead set aside in Trust, appreciation and income will be taxable. If you want to set up trusts using the annual gift exclusion instead of using that exclusion to fund a 529, then you could maximize your gifts by...

Doc, I think YDNAL was correct with "The answer to your question lies in Morningstar's criteria of the Intermediate Bond Category (CI)." I was unable to find info on how M* constructs their "Intermediate-Term Bond" benchmark, but suspected that it might have a heavier weighting t...

Hi All, When comparing the YTM of VFITX to VWITX, the muni YTM is 100Bps higher than that of treasuries even though duration is roughly the same. The spread between distribution yields is even greater (throw in income taxes, and the spread grows even further). I understand that the new muni rating s...

Large organizations can be very difficult to deal with, but the HR dept would likely be the best place to start since they tend to be charged with 401k admin issues. Good luck!

I'm an advisor with many clients that are also small business owners with 401k plans. As a service to them, I've helped many transition their 401k plans to Vanguard (I've helped move several millions of 401k plan assets to Vanguard, but I do not charge on those assets). What I've seen is Vanguard pr...

I assisted both Mr. Zweig and Mr. Hettena with their articles, and have become quite familiar with the Bucket Strategy as well as how the strategy is actually implemented. When it comes to actual implementation, it seems the buckets often consist of roughly: 15% cash and cash equivalents 30% equitie...

AMA = ask me anything

I think it's a Reddit thing....

Hi All, A recent thread about TBM's portfolio and its average duration got me to thinking: If TBM's average duration is 5+ years with components ranging from short to long term bonds, how would its interest rate sensitivity differ from a substantially identical bond portfolio which constrains its bo...

In my personal life I had my own version of a financial crisis which is completely unrelated to the market collapse of the last few years... Morgan, In the spirit of this being an AMA thread, please elaborate on this financial crisis and what could have been done differently, if anything. This is b...

If the mother was the only source of the account funds AND the daughter has never withdrawn funds from the account, then any taxable income associated with the account is likely the mother's. If the daughter has withdrawn funds, then it's quite likely a deemed gift has occurred, not only the amounts...

I read the annual report, prospectus, and SAI, but wasn't able to fing anything re: rebalancing.

Separately, I actually used to write all of these documents for 4 "private" '40 Act funds with over $1B of net assets so I know my way around them fairly well

Hi All, Does anyone here know how often the Vanguard Target Funds rebalance to AA targets? Daily, weekly, monthly, quarterly, annually, 5-years, "tolerable bounds", other? I assume the funds also move toward target with new money and redemption requests, but I wouldn't think that action al...

555 - Have you read Mr. Swedroe's Bond and/or alternative investment books? In each of these he provides very good info re: Stable Value Funds (both books have the approx same info re: Stable Value Funds). If you haven't read them I highly recommend. Stable Value funds as a whole aren't necessarily ...

Thanks BC! Reading Ms. Thau's chapter on MBS was VERY helpful (as was the rest of the book). MBS aren't for me either.

Ah yes, sector exposure. As a US investor I do believe that adding foreign countries helps to offset currency risk as well, though. This said, it would seem to me that including Canada (a developed nation with substantial natural resources) would help diversify both sector and currency risk. Separat...

Hi all, Most everyone on this board seems to agree that adding foreign developed large cap exposure to an AA is prudent. For all you BHs that prefer setting your own For Dev Large Cap AA target (versus letting it float with the world's equity capitalization), do you think it's necessary to have expo...

Hi All, Over the past few years I have witnessed (but not quantified) more investors shifting their small cap exposure to be more "value" oriented. Here in Washington State even the state has recently dumped their employees' small cap option in favor of providing only a small cap value ind...

Thought this Krugman blog might be of interest. Deals w/whether CPI figures are accurate.

http://krugman.blogs.nytimes.com/2011/1 ... theories/#

Thanks. The Wiki forum was somewhat helpful. "The Total Bond Market Index Fund is fine, but I vaguely wonder about a bond fund that has 35% of its portfolio in non-bonds" ~ jack bogle, 2007 Mr. Bogle also gave an interview a few days back where he said something to the effect of: The Total...

Hi all, I find myself compelled to have an AA with an MBS target simply because the MBS market is such a large portion of the US bond market. Based solely on the characteristics of the MBS asset class, however, I find little to suggest adding them would increase a portfolio's efficiency. Perhaps sim...

Thank you all for your responses! Quite an enlightening crowd! It seems to me that any foreign equity allocation between 30 percent and market weighting would be prudent. Perhaps I was remembering incorrectly, but my concern was that I was missing something that the respected authors had not. It was...

Hi All, Most everything I've read suggests an equity allocation of no greater than 30 percent foreign (presumably for US investors). Why is this when over half of the investable equity market is outside the US? Does the rather consistent 30 percent limitation result from anticipated currency convers...

The math doesn't seem entirely difficult, but the data collection to get there is a bit more than I care to tackle right now!!

Hi all,
In Mr. Bogle's Common Sense he provides what he footnotes as "Modigliani Returns" in Figures 6.6. Does anyone know the equation used for arriving at the figures presented?