Search found 268 matches

by Userdc
Thu Oct 14, 2021 12:22 pm
Forum: Personal Finance (Not Investing)
Topic: Anyone negotiate a car lately? Any room as consumers?
Replies: 177
Views: 24763

Re: Anyone negotiate a car lately? Any room as consumers?

I got a new car below MSRP last month.

But I think i was just lucky that I wanted a less desirable vehicle AKA a sedan.
by Userdc
Tue Mar 10, 2020 12:25 pm
Forum: Personal Consumer Issues
Topic: Cruise Cancellation
Replies: 62
Views: 7185

Re: Cruise Cancellation

I’m not familiar with the ins and outs of travel insurance, but do you need a loss to file a claim? If the cruise company is offering you full credit when you cancel, would you still be able to file a travel insurance claim? There also might be explicit epidemic carve outs as well. Check the policy.
by Userdc
Wed Feb 05, 2020 7:21 pm
Forum: Personal Consumer Issues
Topic: NYC w/ 10 month old and no stroller or car seat. Doable?
Replies: 39
Views: 3247

Re: NYC w/ 10 month old and no stroller or car seat. Doable?

Two adults and one baby? Bring a stroller.

Those cheap umbrellas strollers fold up instantly and can be gate checked for free.

For the subway, one person grabs the baby, the other folds and grabs the stroller and you are on the subway platform in a flash. Just avoid rush hour and you should have plenty of space on the subway.

The cheap lightweight Cosco car seats are great, but if you are only going to be in a car between airport and hotel, I would just do Uber car seat.

LGA is the best airport if you are Ubering. Depending on time of day, it will be a 15-60 minutes shorter ride than the other airports.
by Userdc
Wed Jan 15, 2020 12:06 pm
Forum: Personal Finance (Not Investing)
Topic: When can I get rid of PMI?
Replies: 13
Views: 2049

Re: When can I get rid of PMI?

Cancellation at 78% of the original value for borrower paid MI is part of a Federal Law called the Homeowners protection act.

However this threshold is based on the amortization schedule of the loan. If you make a large curtailment like you suggest, you will not accelerate that timeline.

For cancellation based on LTV< 80% due to curtailments or property value appreciation, the short answer is that “it depends”. Fannie Mae and Freddie Mac have different rules, and I would encourage you to check their seller/servicer guides for more detail. But I’m not sure you will be able to go into that loan with 100% confidence that you will be able to cancel MI that quickly.
by Userdc
Wed Nov 13, 2019 7:25 am
Forum: Personal Consumer Issues
Topic: Tech guys need help with Mesh wifi booster...
Replies: 48
Views: 3521

Re: Tech guys need help with Mesh wifi booster...

I messed around with extenders, different router placement, and just dealing with bad WiFi for years.

Then I bought a google WiFi and I have had zero issues since then. I had planned to set up a MoCA backhaul, but didn’t need it, I’m able to stream seamlessly anywhere in the house.
by Userdc
Thu Aug 15, 2019 3:32 pm
Forum: Personal Consumer Issues
Topic: Anyone in Westchester County, NY here?
Replies: 11
Views: 1621

Re: Anyone in Westchester County, NY here?

Are you looking to rent or buy?

There are some older co-op buildings in many Westchester towns that are walkable. Have you looked at the newer riverfront condos/townhouses in Tarrytown/Ossining?

Long Island City is going to have 100 times more walkability, food options, and access to the city than anywhere on Westchester. I like both Westchester and LIC, but you have to decide for yourself if you care about those things more than a short commute, easier parking and all the other things Westchester has to offer.
by Userdc
Thu Jul 25, 2019 9:24 am
Forum: Personal Finance (Not Investing)
Topic: First Home Purchase - Disagreement on Appraisal Contingency
Replies: 81
Views: 5658

Re: First Home Purchase - Disagreement on Appraisal Contingency

Next time don’t let on that you are putting more than 20% down! Would the offer sheet simply say, 'I'd like to buy your house'? :happy That's kind of an important chip to play in a seller's market with competing bids. Not something to easily hide. Most purchase agreements have it required to state how you are paying, and if using financing what % will be used. Yes, this is vital info in assessing offers. As a seller/sellers agent, I would reject any offer that didn't include details on how buyer intends to pay for the home. Precisely. In addition, a highly qualified buyers typically has greater leverage than a less qualified one, as the former offers much higher likelihood of the deal actually going through. A buyer putting a lot of money ...
by Userdc
Thu Jul 25, 2019 8:36 am
Forum: Personal Finance (Not Investing)
Topic: First Home Purchase - Disagreement on Appraisal Contingency
Replies: 81
Views: 5658

Re: First Home Purchase - Disagreement on Appraisal Contingency

This seems like a reasonable ask from the seller. You’ve agreed on the price and they don’t want to give you a free option to get cold feet and force them to find another buyer or try to renegotiate if the appraisal comes in slightly low.

Appraisals are a wild card and can come in all over the place. 5 different appraisers will give you 5 different values.

The appraisal contingency is really there for those that are down payment constrained ie, do not have the ability to close unless they can get a certain amount of financing. If you have the wiggle room to put down a slightly larger down payment, I think the sales price minus $25k is plenty fair.

Next time don’t let on that you are putting more than 20% down!
by Userdc
Wed Jul 24, 2019 9:20 am
Forum: Personal Finance (Not Investing)
Topic: Is solar power for your home a worthwhile investment?
Replies: 152
Views: 19717

Re: Is solar power for your home a worthwhile investment?

Solar is entirely dependent on subsidies. Sounds like somebody has an axe to grind. This is far from true. https://www.forbes.com/sites/dominicdudley/2018/01/13/renewable-energy-cost-effective-fossil-fuels-2020/#433ea7054ff2 This thread is about putting solar on your home. Prove that it is economic without subsidies. I’ve looked at it and even with the federal subsidy it was at least a ten year payout assuming perfect light each day vs a power rate of around 10 cents/kWh. The system that we are installing in a couple of weeks had a 5 year payback with Federal and local tax credits/rebates and would have a 9 year payback without any subsidies which is well within the 25 year lifetime of the system. What are your electric rates? A 9 year pay...
by Userdc
Wed Jul 24, 2019 8:56 am
Forum: Personal Consumer Issues
Topic: Thank you notes,,, out of favor these days?
Replies: 107
Views: 7932

Re: Thank you notes,,, out of favor these days?

I guess I’m in the minority here, but I don’t like thank you notes and I certainly hope they are going away. We all have enough on our plates in life without collectively burdening ourselves with another chore.

I also find them disingenuous. It’s odd that every gift I’ve received a thank you note for has apparently been a huge hit, while I’ve personally received many awkward and underwhelming presents.

Thank me in person the next time you see me, or with a text, or not at all. I certainly don’t expect a note and I don't write them.

Whenever I get one, especially a handwritten one, I just feel bad for the person who felt obligated to write one. I use a pen so rarely these days, that my hand aches in sympathy every time I get one.
by Userdc
Wed Jun 05, 2019 7:16 am
Forum: Personal Investments
Topic: Should I bring bonds into my Roth IRA?
Replies: 21
Views: 1856

Re: Should I bring bonds into my Roth IRA?

As long as you tax-adjust your different account types, I don’t think it matters if you own bonds in tax-deferred or Roth accounts.

1. Figure out your total asset allocation bonds v stocks
2. Multiply your taxable and tax-deferred by a percentage equal to the percentage of those accounts you expect to receive on a post-tax basis when you withdraw from them. Roth gets counted at 100%.

Once you do that, there’s no magic to the Roth where it’s better to own bonds there instead of tax-deferred.

Personally, I spread out my bond allocation among taxable (munis), Roth, and tax-deferred to diversify against future tax unknowns, but the number I’m really focused on is the total tax-adjusted bond allocation.
by Userdc
Thu Feb 14, 2019 7:18 am
Forum: Personal Finance (Not Investing)
Topic: 2019 Tax Question with respect to 2018 SALT deduction limit
Replies: 18
Views: 1456

Re: 2019 Tax Question with respect to 2018 SALT deduction limit

I’m way above the SALT limit, so I’m assuming state tax refunds will no longer be included in income starting with my 2019 return.
by Userdc
Thu Feb 14, 2019 7:11 am
Forum: Personal Finance (Not Investing)
Topic: [2018 tax return - How does it compare to previous years?]
Replies: 441
Views: 43861

Re: [2018 tax return - How does it compare to previous years?]

I model my taxes in Excel throughout the year to dial in my withholding, so I was able to run my 2018 taxes under the new law and the old laws. I can’t be 100% sure I did the old tax laws right, but my Excel calculation for the new laws matched my TurboTax numbers.

I was significantly impacted by the SALT limitation, so my tax burden is nearly identical under both regimes.

Of course if almost everyone else is paying less, and I’m paying the same, that feels an awful lot like a tax increase.
by Userdc
Fri Feb 17, 2017 10:12 am
Forum: Personal Investments
Topic: 529 Asset Allocation - is this valid thinking?
Replies: 54
Views: 9029

Re: 529 Asset Allocation - is this valid thinking?

Just speaking for myself, I have 529 accounts for my young children and have 100% in bonds.

I consider it part of overall asset allocation, so I don't think it's too important what my the allocation is in the 529 as long as I offset it elsewhere but I ended up 100% bonds for two reasons:

1. Quality of fund availabile in the 529 versus other accounts,

2. I also don't want to overaccumulate in the 529.
if equities quadruple over the next 20 years (like they did over the last 20), I'd rather have that happen in my 401k or IRA. This isn't a worry for a small 529, but my state provides a generous tax incentive for 529 contributions, so I contribute a sizable chunk every year to take advantage.
by Userdc
Fri Jun 17, 2016 11:11 am
Forum: Personal Consumer Issues
Topic: Medical Billing Error - a success story!
Replies: 16
Views: 4304

Re: Medical Billing Error - a success story!

I am also convinced that many of these "errors" are fraudulent attempts by doctors and hospitals to get overpaid by forgetful or busy patients who don't check their math. And I bet their success rate is pretty high. We recently went through this on an HSA plan, where we received a flood of bills in a short period of time. At least two of them did not make any attempt to run through our insurance to get the negotiated rate or the insurance portion of coverage (we blew through our deductible pretty handily). In one of those cases, a hospital sent us three separate bills for different services all of which were run through our insurance company and matched the EOBs. But they also sent us a fourth bill for the same patient on the same...
by Userdc
Wed Feb 03, 2016 9:17 am
Forum: Personal Finance (Not Investing)
Topic: What do you pay per year for daycare?
Replies: 33
Views: 3604

Re: What do you pay per year for daycare?

We have 12 hours/day of in-home care for two toddlers, plus preschool for both in NY Metro.

Nanny Salary + health care + (a lot of) taxes + payroll service + preschool tuition is north of $70K/year.
by Userdc
Tue Dec 08, 2015 4:56 pm
Forum: Personal Consumer Issues
Topic: Quadcopter (drone) experience/recommendation
Replies: 26
Views: 2687

Re: Quadcopter (drone) experience/recommendation

I'd start with a super cheapo like the $50 syma X-5c before sinking any money into an intermediate or advanced model.
by Userdc
Mon Oct 12, 2015 9:08 am
Forum: Personal Finance (Not Investing)
Topic: Hard to live well and save on $1mm in NYC Metro
Replies: 37
Views: 4075

Re: Hard to live well and save on $1mm in NYC Metro

Why are you paying NYC income taxes?

A $1.5-2M home is quite nice in the NYC suburbs and on your 15Y mortgage you are "saving" quite a bit every month in principal payments.

I won't go line by line on the rest, but this is a very comfortable upper middle class lifestyle and you are still saving well into the 6 figures every year.
by Userdc
Fri Apr 10, 2015 12:16 pm
Forum: Personal Finance (Not Investing)
Topic: Should I renege [on a] job offer?
Replies: 48
Views: 8937

Re: Should I renege [on a] job offer?

You'll need to originate some serious deal flow to pull in 2MM in comp as a MD haha. Even then, I'd be surprised your not out in PE if your in it for the money. A MD at BX/TPG/KKR can make SO much more than any BB/Elite MM. I feel like consulting comp is still pretty good. At the shop I signed at, its possible to make partner in 7-8 years if your a rockstar. First year partner makes 500k base NOT including all the profit sharing. Of course, I feel like once you reach that point in salary, it really doesn't matter all that much lol. Be careful of making generalizations based on what you've heard from others in your peer group. First year analysts in the banking world often have bizarre and misguided perceptions of comp and the "right&q...
by Userdc
Tue Mar 24, 2015 7:00 am
Forum: Personal Finance (Not Investing)
Topic: Do we need irrevocable life insurance trust (ILIT)?
Replies: 27
Views: 4345

Re: Do we need irrevocable life insurance trust (ILIT)?

a carefully planned death
Don't give your wife any ideas.

I don't know anything about ILITs, but I will echo the others who think $10M is way too much for your situation.

Focus on replacing needs, not income. And don't forget about social security death benefit for the kids.

At the very least, consider laddering policies so you aren't paying a 20 year premium on that full amount when it sounds like your needs will rapidly decline.
by Userdc
Sun Mar 22, 2015 10:10 am
Forum: Personal Consumer Issues
Topic: Laptop: Windows based vs. Apple
Replies: 87
Views: 18848

Re: Laptop: Windows based vs. Apple

I have always used windows-based PCs, at home, at school, at work. I have no desire to learn another operating system, so I find macs and tremendously frustrating to use when I am forced to use my wife's macbook.

I have nothing against Apple - I've owned many of their products, including many varieties of iPhone, but there's nothing compelling about a Mac that I can't get with a PC.

My personal PC of choice is the Surface Pro, which is super-portable, gives me the Windows environment I'm used to, is at least as zippy as my wife's MacBook, and does a good enough job of impersonating a tablet that I've managed to restrain myself from ever buying an iPad.
by Userdc
Tue Mar 17, 2015 3:24 pm
Forum: Personal Investments
Topic: how often do you check performance?
Replies: 70
Views: 9195

Re: how often do you check performance?

I check balances daily and performance relative to benchmarks, never.
by Userdc
Mon Mar 02, 2015 1:46 pm
Forum: Personal Finance (Not Investing)
Topic: First Home Purchase - Property Tax vs Commuting Costs
Replies: 17
Views: 1806

Re: First Home Purchase - Property Tax vs Commuting Costs

Living in a closer suburb vs a further suburb is not a math problem. There are major differences between these two lifestyles that will have a much larger impact on your life than a miniscule difference in commuting costs.

Personally, I live in an option 1 town because I like a shorter commute, a dense walkable community, and proximity to the city on weekends. I'm willing to live in a smaller house, smaller lot, and deal with more traffic to get those things.
by Userdc
Sat Feb 28, 2015 6:03 pm
Forum: Personal Consumer Issues
Topic: iPhone upgrade
Replies: 30
Views: 4950

Re: iPhone upgrade

I don't think that's gouging, iPhones are expensive.

It sounds like you have a plan that doesn't bundle in "free" upgrades every two years paid for by a higher monthly bill. As these plans have become less popular, I've seen multiple people be surprised by how expensive smartphones are.

The best way to save money is to get an older model phone, or a phone with less features or a used/refurb phone.
by Userdc
Thu Feb 26, 2015 6:51 am
Forum: Personal Consumer Issues
Topic: 3 Kids and 2 Dogs - Next Vehicle
Replies: 31
Views: 10355

Re: 3 Kids and 2 Dogs - Next Vehicle

zadie wrote:Honda Odyssey is a nice van but is pretty bad in the snow.

Toyota sienna is also nice but has run flat tires (no spare) which was a deal breaker for us.
We put snow tires on our Odyssey in the winter and we haven't had any traction issues. But we do live in an urban area that is quickly plowed, so those snow tires might even be overkill.
by Userdc
Sun Feb 22, 2015 7:36 pm
Forum: Personal Consumer Issues
Topic: School ratings, differing opinions on potential home local
Replies: 11
Views: 1524

Re: School ratings, differing opinions on potential home loc

Personally, I think the vast majority of the difference you see in school system performance has nothing to do with the schools or teachers or "quality" of the school system. Again, just my opinion, but good kids with good parents will do just as well in the 40th percentile school as the 95th percentile school.

But setting that aside, I recommend you move to your top choice town and rent before you buy. Meet the people in your neighborhood, and make friends with other parents who have children the same age as yours. If you like the other parents, you'll probably like the school just fine.
by Userdc
Sat Feb 21, 2015 3:45 pm
Forum: Personal Consumer Issues
Topic: CarsDirect didn't lead to dealers responding with prices
Replies: 63
Views: 9569

Re: CarsDirect didn't lead to dealers responding with prices

I'm confused as to why trying to pay what others are paying is such a good deal - don't most people overpay for cars because they are even less savvy than someone going off invoice? I really think your average car buyer is an easy mark. I think I'd still prefer knowing invoice, dealer holdback, and other incentives that you can find online would be where I would start. What others paid would also be important as well. In short, voodoo. :) Pereonally, I'm skeptical that all of the information about what dealers REALLY pay for the car is publicly available. I suspect there are frequently rebates and shenanigans that you will never see. I think that the prices that dealers have actually sold the vehicles for tells you a lot more about their t...
by Userdc
Sat Feb 21, 2015 11:14 am
Forum: Personal Investments
Topic: How to handle temporary blip in asset allocation?
Replies: 1
Views: 392

How to handle temporary blip in asset allocation?

My current asset allocation is 60/40. One third of the stock allocation is vested but not delivered company stock (I don't include unvested stock in my AA). When this vested stock is delivered shortly, it will be delivered as stock to a brokerage account and sold on my behalf over a series of days, so there is a ~10 business day period between when I first start selling and when I have access to those funds in my bank account to buy a vanguard equity index fund. What should I do to avoid skewing my asset allocation for a couple weeks? 1) as the company stock is sold, swap out bond funds for equity funds in multiple 401k and IRA accounts, and then swap them back when I have all of the cash in bank account for Vanguard purchases. 2) as the co...
by Userdc
Sat Feb 21, 2015 10:12 am
Forum: Personal Investments
Topic: HSA with Significant Known Medical Expenses
Replies: 5
Views: 809

Re: HSA with Significant Known Medical Expenses

Can you do an FSA with option 3?

If you have predictable medical expenses, a traditional plan with an FSA can be just as tax-efficient as an HDHP with HSA.
by Userdc
Sat Feb 21, 2015 8:33 am
Forum: Personal Consumer Issues
Topic: CarsDirect didn't lead to dealers responding with prices
Replies: 63
Views: 9569

Re: CarsDirect didn't lead to dealers responding with prices

I tried the email game the last time I bought a car, and it was mostly a waste of time. Here's what I recommend: 1) pick out the car you want, know exactly what trim/options/color you want. 2) use truecar, edmunds, and any online resources you can find (car specific forums, etc) to figure out what people are actually paying for that car in your area. This can change very rapidly, so there's no point in doing this until you are ready to buy. Invoice and MSRP are irrelevant, what matters is what people are actually paying for the car.DO NOT submit your actual information to the pricing/quote services because the dealer may have to pay a referral fee which is coming out of your pocket. 3) Check the inventory of your local dealers to find out w...
by Userdc
Thu Feb 12, 2015 2:30 pm
Forum: Personal Investments
Topic: Quick question on tax-advantaged space
Replies: 26
Views: 2432

Re: Quick question on tax-advantaged space

Triple digit golfer wrote:

I currently don't have a Plan C.

Why take out a car loan if less than 3%? Assuming a five-year loan, where am I going to get a guaranteed 3% or thereabout?
Many car loans are cheaper than 3%. Penfed has a 60 month new car loan at 2.25%.

Just borrow the $12K instead of using your roth, and invest that in laddered pen fed CDs/savings accounts over the life of that 2.25% loan. You'll pay ~$400-500 in net interest over the life of the loan, which (depending on timeframe and tax situation) is probably a bargain for $12K of roth space you otherwise can never get back.

Also consider taking financing from the dealer - there can sometimes be a free lunch based on how they are incentivized for pushing 0 or low APR loans.
by Userdc
Thu Feb 12, 2015 7:03 am
Forum: Personal Consumer Issues
Topic: Where to buy nice men's dress shirts?
Replies: 94
Views: 30083

Re: Where to buy nice men's dress shirts?

I've tried everything but I keep coming back to the BB non-iron slim fits.

I wish they were a little cheaper and the elbows didn't tear so easily, but I haven't found any off-the-rack shirts that match up in terms of fit, look, and comfort.

I just stock up a couple of times a year during the sales.
by Userdc
Wed Feb 11, 2015 12:50 am
Forum: Personal Finance (Not Investing)
Topic: Should I Get an HDHP Just to Use an HSA?
Replies: 20
Views: 2909

Re: Should I Get an HDHP Just to Use an HSA?

I still don't think those numbers are right.

Here's the parameters:

HDHP: 2,000 deductible, 4,500 OOP Max
Standard: 300 deductible, 2,500 OOP Max

So if we assume the HSA benefit is a round $1,000 dollars, then I show the breakeven at $1,550:

HDHP: $1,550 - $1,000 = $550
Standard: $300 + 20% * ($1,250) = $550

Anything higher than that and the Standard wins hands down.

The HSA could be worth more (if you have high state tax, marginal payroll tax) or less (if you use FSA or itemize medical deductions on the standard insurance, OR you end up no needing the HSA for future medical expenses).

I love HSAs, but I'd personally just take the Standard in this case.
by Userdc
Sun Feb 08, 2015 9:27 am
Forum: Personal Finance (Not Investing)
Topic: How much was your Tax Refund (or amount DUE)
Replies: 110
Views: 14189

Re: How much was your Tax Refund (or amount DUE)

I will owe >$10K to the Feds and will get about the same amount back from my state.
by Userdc
Sat Feb 07, 2015 8:47 pm
Forum: Investing - Theory, News & General
Topic: Determining your "number" when you want to leave nothing
Replies: 21
Views: 3304

Re: Determining your "number" when you want to leave nothing

Get a SPIA quote.

If you put zero value on a bequest, it's hard to beat the safe withdrawal rate of a SPIA.
by Userdc
Sat Feb 07, 2015 3:53 pm
Forum: Personal Finance (Not Investing)
Topic: Should I Get an HDHP Just to Use an HSA?
Replies: 20
Views: 2909

Re: Should I Get an HDHP Just to Use an HSA?

The only way I could see an advantage here is if you are in a very high tax bracket and already max out your tax advantaged space.

In that situation, it might be worth it to "pay" for additional tax-deferred space by taking a worse plan.
by Userdc
Thu Feb 05, 2015 7:55 am
Forum: Investing - Theory, News & General
Topic: [Janitor in Vermont leaves millions] A true Boglehead!
Replies: 55
Views: 6388

Re: A true Boglehead!

I don't think you need to own index funds to be a boglehead.

Before index funds existed, you could get practically the same result by accumulating a diversified stock buy-and-hold portfolio, while also investing in savings bonds and CDs.

And you could still do the same thing today.
by Userdc
Tue Feb 03, 2015 2:39 pm
Forum: Personal Finance (Not Investing)
Topic: Are car loans really that bad?
Replies: 86
Views: 20601

Re: Are car loans really that bad?

sls239 wrote:
A 4-year-old model with 40-50k miles would have saved me ~25%
But percentage of purchase price is not the appropriate way to measure the savings.
That's a very low depreciation rate for a car. But if it really only depreciates 25% in 4 years, it's potentially cheaper to own the new car.

Let's say the new car costs $20K and will cost $5K in depreciation and virtually $0 in repairs over the next 4 years.

The 4 year old car costs $15K and assuming the same depreciation rate, will cost $3,750 in depreciation, and would need to have less than $1,250 in repairs in years 5 - 8 to be cheaper to own than the new car.

I'm taking the new car, too.
by Userdc
Mon Feb 02, 2015 8:23 pm
Forum: Personal Finance (Not Investing)
Topic: Poll: Do you contribute max to tax-advantaged before 529?
Replies: 50
Views: 6852

Re: Poll: Do you contribute max to tax-advantaged before 529

In other words, a 529 plan is not the only game in town. Those education tax credits are quite helpful, especially since we never did double our money in 529 plan investments. So something to think about is whether your family will be able to take advantage of those tax credits.
I have no idea if I'll qualify for the tax credit or whether it will still be around in 15 years, while the recent chatter in DC only further convinced me that 529s aren't going anywhere.

Hopefully I'll be able to take advantage of both.

It helps that my state has a generous tax break for 529s. I might no contribute to a 529 without it.
by Userdc
Sun Feb 01, 2015 6:50 pm
Forum: Personal Finance (Not Investing)
Topic: Need advice on financing RV
Replies: 7
Views: 1593

Re: Need advice on financing RV

Have you looked into a HELOC? Might be a lower rate than the RV loan.
by Userdc
Thu Jan 29, 2015 12:22 pm
Forum: Personal Investments
Topic: HSA... any receipt savers?
Replies: 218
Views: 37743

Re: HSA... any receipt savers?

letsgobobby wrote: Just like with a "get out of jail free" card in Monopoly, I suspect most of us would save it until we actually needed it.
I suspect you are right, but most people would pay less taxes and end up with more money if they used the voucher ASAP.
by Userdc
Thu Jan 29, 2015 12:14 pm
Forum: Investing - Theory, News & General
Topic: Placement of stock/bonds - tax-deferred vs. tax-free
Replies: 4
Views: 722

Re: Placement of stock/bonds - tax-deferred vs. tax-free

I would recommend using a tax-adjusted asset allocation. Userdc - thanks for the response. Even with the tax-adjusted allocation in that hypothetical, I'm going to end up with less of an after-tax benefit if stocks outperform bonds than if I had put 100% stocks in the Roth. So if I'm willing to bet that, for purposes of allocation between accounts (i.e., tax purposes), stocks outperform bonds, why would I put any bonds in the TIRA? If you use a tax-adjusted allocation, it doesn't matter what you put where. Run these three scenarios assuming a 20% tax rate. All have a 50/50 tax-adjusted allocation and all have equivalent after-tax outcome: A: 10/90 in Roth, 100/0 in Trad B: 50/50 in Roth, 50/50 in Trad C: 90/10 in Roth, 0/100 in Trad
by Userdc
Thu Jan 29, 2015 11:44 am
Forum: Investing - Theory, News & General
Topic: Placement of stock/bonds - tax-deferred vs. tax-free
Replies: 4
Views: 722

Re: Placement of stock/bonds - tax-deferred vs. tax-free

I would recommend using a tax-adjusted asset allocation.

So if you expect your tax rate in retirement to be 20% (to make the math easy), you effectively own 80% of that account and the government owns 20%.

So your tax-adjusted account values are $5k for the Roth and $4K for the trad IRA.

Using those values, your actual asset allocations are:

A: 55/45
B: 50/50
C: 45/55

So A does the best because you actually have more stock exposure than the other two.
by Userdc
Thu Jan 29, 2015 11:29 am
Forum: Personal Investments
Topic: HSA... any receipt savers?
Replies: 218
Views: 37743

Re: HSA... any receipt savers?

This discussion has been very helpful for me as well. To me, the two key assumptions for knpstr's analysis are:

1) you expect your lifetime HSA contributions/earnings to comfortably exceed your lifetime medical expenses. Essentially, you are putting extra money in the HSA with the intent of using some of it as a traditional IRA.
2) you have enough other tax-deferred space for your bond allocation

If those two assumptions hold, most people would be better off pulling from the HSA as they go, rather than saving receipts.

The equivalent concept: let's say the government gives you a voucher to pull $10K tax-free out of your traditional deductible IRA. Would you use that voucher today or at some point in the future?
by Userdc
Thu Jan 29, 2015 9:24 am
Forum: Personal Investments
Topic: Just purchased 2015 maximum EE Series Bonds
Replies: 67
Views: 8122

Re: Just purchased 2015 maximum EE Series Bonds

How does one account for that drawback in determining whether EE or I bonds are more attractive?
I have accounted for that by buying I Bonds and not buying EE Bonds. That continues to be one of the key reasons I struggle with EEs.

But I'm running out of tax-deferred space for bonds, and I'm starting to feel like I'm full up on munis and I-Bonds, so I'm taking a closer look this year.
by Userdc
Thu Jan 29, 2015 8:51 am
Forum: Personal Finance (Not Investing)
Topic: Poll: Do you contribute max to tax-advantaged before 529?
Replies: 50
Views: 6852

Re: Poll: Do you contribute max to tax-advantaged before 529

I contribute max to all tax advantaged accounts except for 529.

For 529 I contribute up to the maximum state income tax break, and no more.
by Userdc
Thu Jan 29, 2015 8:26 am
Forum: Personal Investments
Topic: HSA... any receipt savers?
Replies: 218
Views: 37743

Re: HSA... any receipt savers?

I think it's good for everyone to run the numbers, and there are certainly scenarios where a taxable account beats a non-deduticble IRA (which I think is the appropriate comparison when we talk about whether we should spend 1,000 already in an HSA vs 1,000 in taxable). In many cases, this same analysis will lead to a very different answer: 1) lower income tax rate in retirement. Many people currently in 15% dividend bracket will have lower than 25% marginal tax rate in retirement. 2) higher dividend tax rate. Federal dividend tax can be as high as ~25% (20% + Medicare surtax + pease). Even if that drops to 15% in retirement, the running tax drag erases any taxable advantage to lower capital gains at the end. 3) non enough tax-deferred space...
by Userdc
Tue Jan 27, 2015 7:07 pm
Forum: Personal Investments
Topic: Just purchased 2015 maximum EE Series Bonds
Replies: 67
Views: 8122

Re: Just purchased 2015 maximum EE Series Bonds

remember that government can change the rules at any time, like change doubling time from 20 to 30 years... this would be a disaster, and I would be out... so if you are planning on it, grab the opportunity while it still exists, don't procrastinate, I've learned my lesson with Tobyhanna CDs, first time around I could have opened 10 1K CDs each yielding 3.04% with possibility of adding money any time... I missed that boat, the deal dissapeared... Don't sweat the small stuff. I can't get excited about locking in a ~zeroish after-tax real yield for 20 years on a very low single digit percentage of my portfolio. I'll do it if I can convince myself it's the best option, but if I decide not to, I doubt I will be kicking myself for missing out o...
by Userdc
Tue Jan 27, 2015 6:36 pm
Forum: Personal Investments
Topic: Just purchased 2015 maximum EE Series Bonds
Replies: 67
Views: 8122

Re: Just purchased 2015 maximum EE Series Bonds

This might be the year I finally pull the trigger on EE bonds.

My long term tax exempt munis have performed well the last year, but that means the SEC yield has dropped to 2.16%. So, right now EE bonds look attractive even if I remain in a high tax bracket 20 years from now.

I still have trouble with the huge early withdrawal penalty, but its getting to the point where the good outweighs the bad.
by Userdc
Sun Jan 25, 2015 6:13 pm
Forum: Personal Finance (Not Investing)
Topic: Salary to Home Value/Mortgage Ratio?
Replies: 50
Views: 23604

Re: Salary to Home Value/Mortgage Ratio?

i don't know if there's a good rule of thumb for this, it depends on so many factors, and gross salary is only one of them.

To me, as long as you
1) can afford the PITI and still hit your savings goals AND
2) the cost to buy isn't way out of whack with the cost to rent AND
3) you plan to stay long enough to overcome the fixed costs of buying/selling (typically 5+ years)

Then go for it.