Search found 50 matches

by drs85
Thu Dec 05, 2013 8:49 pm
Forum: Investing - Theory, News & General
Topic: Expense Ratio Net vs. Gross
Replies: 2
Views: 1718

Expense Ratio Net vs. Gross

I've searched the wiki and google, and I'm having a difficult time understanding the difference between Net and Gross ERs. For instance, my 403b through Fidelity posts two numbers, that are different, for the fund FSITX:

Exp Ratio (Gross): 0.17%
Exp Ratio (Net): 0.10%

As far as I understand, the Gross ER is what people typically refer to when they say "Expense Ratio", where the Net is not required to be "published" by the fund provider. But in this fund's case, it is published, and it is different. Why is it different, and what makes the 0.07% difference? Could you explain this in lamens terms?
by drs85
Sun Nov 03, 2013 3:48 pm
Forum: Personal Consumer Issues
Topic: Brightspot OR $30/unlimited web/text/100 min. from T-Mobile.
Replies: 26
Views: 5524

Re: Target's Brightspot from T-Mobile.

You can get a T-Mobile Micro SIM Activation Kit (Nano or Regular are also available) for free right now from their website. Free shipping is also available. They do ask you for your credit card at checkout, but they do not charge you anything. I just bought one for my new Nexus 5:

http://prepaid-phones.t-mobile.com/prep ... l-Contract
by drs85
Sun Jul 21, 2013 10:01 pm
Forum: Personal Investments
Topic: Salary Raise - What to do?
Replies: 13
Views: 2972

Salary Raise - What to do?

So, I just got a raise (yay!). It's nothing big (2%), and I'm planning on investing all of it into my retirement account. However, I'm curious what the "good practice" is from a Boglehead perspective on saving a portion of a raise. For instance, if I am currently aiming to save 25% of my income towards retirement, should I save 25% of the 2% raise (.5%)?
by drs85
Thu Apr 11, 2013 7:41 am
Forum: Personal Investments
Topic: HSA or 403b/457b
Replies: 2
Views: 936

Re: HSA or 403b/457b

Ah! I didn't consider the tax free benefit of medical expenses on retirement. That's a good point, and I will continue maxing out my HSA. Thank you.
by drs85
Wed Apr 10, 2013 1:30 pm
Forum: Personal Investments
Topic: HSA or 403b/457b
Replies: 2
Views: 936

HSA or 403b/457b

I am 27 years old. My employer contributes $650/year to my HSA (this contribution may not be in effect forever). Currently I am investing $2600/year on top of that of my own money. My current HSA balance is $7100, which is in a high interest FDIC insured checking account at 3.21%. I am currently gaining more in interest per month than I am spending out of it, on average. The maximum deductable in any given year for my insurance is $2000, in which case anything above that is covered (so I have at least 3.5 years of expenses). I currently max out my Roth IRA ($5500), my employer gives me 12% to my 403b automatically (~$8500), and I'm putting in $8500 into my 457b (which has low ERs). I still have another $26500 (17500+17500-8500) of tax shelt...
by drs85
Thu Mar 14, 2013 11:35 am
Forum: Personal Finance (Not Investing)
Topic: Hot water heater question
Replies: 34
Views: 3807

Re: Hot water heater question

I just had a new HVAC system installed, and while they did it they put in a higher efficiency water heater. The cost of just the water heater, and installation may have been lower due to the other things, was $675.
by drs85
Tue Mar 05, 2013 5:59 pm
Forum: Personal Investments
Topic: Current Fidelity Roth IRA, moving to?
Replies: 9
Views: 2069

Re: Current Fidelity Roth IRA, moving to?

I used to have my Roth IRA through Fidelity, and you can most definitely model the 3-fund portfolio, without trade expenses, with Fidelity's Spartan funds. Both Vanguard and Fidelity have comparable expense ratios with these types of funds, and both are indexed: TSM, 0.10%: https://fundresearch.fidelity.com/mutual-funds/summary/315911404 International, 0.20%: https://fundresearch.fidelity.com/mutual-funds/summary/315911602 TBM, 0.22%: https://fundresearch.fidelity.com/mutual-funds/summary/315911107 Alternatively, there are "Admiral" fund versions (lower ER, Fidelity calls them "Advantage") of those Spartan funds too. You'll just need more money to buy into these funds initially, but you can always switch to them later: T...
by drs85
Fri Mar 01, 2013 5:47 pm
Forum: Personal Consumer Issues
Topic: Titanic II, would you take a cruise?
Replies: 30
Views: 3514

Re: Titanic II, would you take a cruise?

Cruises? I'll never do in my lifetime. Not that I ever get seasick or anything, because I don't, but I'd rather be on land exploring and seeing cultures, countries, cities, attractions and be relaxing on a beach or hiking rather than being at sea and seeing nothing for days, or spending 2-3 hours in a port and before you know it, you're whisked off again before you are able to take in the local attractions, culture, etc. Oh, the cabins are small, too for sleeping. Not really my cup of tea... I've been on 3 cruises now (Bahamas, Caribbean, Mexico), through three different cruise lines (Norwegian, Carnival, Holland America) and they were all fantastic. If you pick the right cruises you are on land most of the day (6-10 hours, not 2-3 as you ...
by drs85
Wed Feb 27, 2013 9:39 pm
Forum: Personal Investments
Topic: Timing on Initial Investment
Replies: 15
Views: 1279

Re: Timing on Initial Investment

Hello Joey, and welcome to the forum. What you're referring to is called market timing, which is usually against boglehead's views as it is a dangerous and slippery slope. If you would have bought into TSM on January 1st of this year, you would have been up 5.5% today. Yesterday, however, you would have only been up 4.2%. If you wait again for it to drop another 1.3%, you may be waiting forever. There's no knowing where the market is going, or even if it will go up again tomorrow, so the best time to invest is always ASAP. Instead of timing the markets, you may want to look into dollar-cost-averaging. For instance, you could take your lump sum of money, and invest an equal amount over the next X months (or even weeks) on the 1st of every mo...
by drs85
Thu Feb 21, 2013 7:50 pm
Forum: Personal Investments
Topic: VTSAX VS. VTSMX [Investor vs. Admiral, Portfolio Help]
Replies: 10
Views: 6439

Re: VTSAX VS. VTSMX [Investor vs. Admiral, Portfolio Help]

Hello Maggiemae! You're correct in that the biggest difference is the Expense Ratio, and the other thing is simply the minimum investment. In the case of Total Stock Market, it's $10K to get the lower Expense Ratio. Other than that it's the same fund, so if you have at least the minimum of $10K, and it sounds like you do, go with the Admiral shares. For more information straight from Vanguard on share classes, see: https://personal.vanguard.com/us/content/Funds/FundsVGFundsShareClassDefJSP.jsp As far as WHAT to invest it, that would depend on your Asset Allocation (risk vs. reward): http://www.bogleheads.org/wiki/Asset_Allocation If you want actual help with what to invest in, and have determined your Asset Allocation, there are a lot of he...
by drs85
Sun Feb 17, 2013 1:04 pm
Forum: Personal Investments
Topic: Is there an Adrian's Rule for Bond Funds ?
Replies: 49
Views: 3161

Re: Is there an Adrian's Rule for Bond Funds ?

Just as a disclaimer, I was just as confused about potential bond loss as Bustoff is, so I started doing some digging recently and this is what I've justified. It's completely rough numbers, and I could be wrong (and I'd love for correction if it exists). I find as though recently with talks of a "bond bubble" Bogleheads are loosening their underlining philosophies: buy and hold ("stay the course"), don't try and compete with the market (who cares if someone makes more than you next year as long as you are happy with your returns), and don't try and time the market (no one really knows when a bond bubble is going to happen). TBM is a fantastic fund for all of the reasons Bogleheads are Bogleheads: It isn't managed by an ...
by drs85
Wed Feb 13, 2013 9:01 pm
Forum: Personal Investments
Topic: Investing/finance help for newly married 25y/o
Replies: 4
Views: 742

Re: Investing/finance help for newly married 25y/o

1. I agree with BoulderBoy in that you should always try for the maximum contribution towards your retirement (IRA). Try to put $5500/year into that from both of you. Does either of your work offer a 401k/403b and matching? Contribute up to the match first before the IRA, as that's "free" money. 2. Since your highest interest rate you owe is on your student loans at 6.7%, and it's also the smallest amount you owe, I would contribute the minimum to your mortgage ($1870) and move that extra $130 + anything else you can do towards the higher interest student loan. Once that's paid off, the extra money you'll have from your car loan amount + the $130 + anything else, you can put that towards the next debt. You could even split that pa...
by drs85
Thu Feb 07, 2013 2:49 pm
Forum: Personal Investments
Topic: How to start investing on minimum wage/part time job?
Replies: 28
Views: 3129

Re: How to start investing on minimum wage/part time job?

Hello mike, welcome to the board! Here's a good start in the wiki with some information about books to read if you're interested in learning more. Your local library may have quite a few of them if you do not want (or cant) purchase them: http://www.bogleheads.org/wiki/Getting_Started I'm currently 27, and from the age of 16 I started saving for retirement just for fun (I was a strange kid) at $50 a month. I then slowly ramped it up every couple months until I was at a point where I couldn't contribute anymore (I believe I made it up to $200/month, but your circumstances may be different). At the time I was working at McDonalds with a similar circumstance as yourself, making between $4K and $8K in any given year. I worked there for 4 years ...
by drs85
Wed Feb 06, 2013 3:45 pm
Forum: Investing - Theory, News & General
Topic: Finally arrived: The Vanguard Total International Bond Fund
Replies: 187
Views: 40468

Re: Finally arrived: The Vanguard Total International Bond F

Out of pure curiosity, would there be a tax-advantage in a taxable account with holding this fund there similar to holding an international index fund vs. domestic index fund? Or is it once a bond always a bond with taxes?
by drs85
Mon Jan 21, 2013 8:57 pm
Forum: Personal Finance (Not Investing)
Topic: Do I need Term Life Insurance?
Replies: 9
Views: 1121

Re: Do I need Term Life Insurance?

Thank you everyone for your responses! I suppose the answer was what I was assuming: we don't need it. A while back (before I started even researching the way of Jack Bogle) a financial advisor said we "needed" life insurance. I was just trying to ration if we actually needed it, or he needed to make one more sale.
by drs85
Mon Jan 21, 2013 4:58 pm
Forum: Personal Finance (Not Investing)
Topic: Do I need Term Life Insurance?
Replies: 9
Views: 1121

Do I need Term Life Insurance?

Hello All - I'm sure this topic has been beaten to death, but I'd like some opinions on our own personal circumstances rather we should be getting Term Life Insurance. * I am a 27 year old male and my fiancee is 23. We do not have any dependents. * The only debt we have is a house mortgage which has roughly $70,000 left, with about $20,000 in equity. We're on track to pay the house off within 10 years (hopefully closer to 6). * Within my retirement accounts (Roth IRA, 403b, and 457b) I have about $100,000. I'm currently adding about 30% per year to that. She has about $10,000 in hers, and is contributing 20% per year. * We are not planning on having children; possibly ever. However, the option isn't off the table, but it probably wouldn't b...
by drs85
Thu Jul 19, 2012 9:41 am
Forum: Personal Finance (Not Investing)
Topic: Simple 401k employer match question
Replies: 7
Views: 1439

Re: Simple 401k employer match question

TJ2012 wrote:EDIT: also a follow-up: How often can you change your contribution? Or does this also depend on the employer? (i.e., if I'm contributing $1500 in Nov and Dec, would I likely be able to scale that back down for Jan?)
This will all depend on your employer. My employer allows for updates to contribution amounts and/or fund choices whenever I want, whereas my girl-friend's employer only allows for updates quarterly. Ask your HR department for their "Supplemental Retirement Document" (at least that's what mine calls it) which will lay out answers to all of the questions you have.

Best of luck!
by drs85
Thu Jun 14, 2012 10:28 pm
Forum: Personal Investments
Topic: Girlfriend's 401k Allocation
Replies: 12
Views: 1743

Re: Girlfriend's 401k Allocation

After reading all of the responses (thank you everyone) it sounds as though it wouldn't necessarily be absurd to do the following until she either has enough in her Roth IRA to support both an International/500 index fund, and/or a 500 fund is introduced to her 401k lineup: 23%: PIMCO Total Return Admin (PTRAX), 0.96% ER 77%: JHVIT Mid Cap Index Trust Ser I (JECIX), 0.55% ER I would then leave her Roth IRA as LifeStrategy Growth (VASGX) since it contains the closest ideal breakdown with 24% Int, 56% TSM, and 20% TBM. Right now she's set on being able to contribute at least $4400 per year in addition to the $5000 to her Roth IRA. So after the first year her account balance, with interest aside, would be $9400 causing the breakdown to be: Int...
by drs85
Thu Jun 14, 2012 6:16 pm
Forum: Personal Investments
Topic: Girlfriend's 401k Allocation
Replies: 12
Views: 1743

Re: Girlfriend's 401k Allocation

A couple of things come to mind. If there is a mid cap index and a small cap index, it is possible there is supposed to be a large cap index. Maybe it just fell off the list or maybe it is an oversight and can be added. This would make the entire plan much more attractive. Growth Fund of America is not a basic large cap fund, but she could pretend it is if necessary. To the extent she can (maybe not yet possible with only $5k in the Roth IRA), she should hold her international in the Roth IRA for the much lower expense ratio. I would not use either the international or the value fund in the 401k. This 401k is not pretty, but it is not so ugly that she should not use it. She has a bound book from her company with all of the funds page-by-pa...
by drs85
Thu Jun 14, 2012 5:55 pm
Forum: Personal Investments
Topic: Girlfriend's 401k Allocation
Replies: 12
Views: 1743

Girlfriend's 401k Allocation

Hello all - My girlfriend (23 years old) just got access to her company's 401k plan through John Hancock. Personally I find the ERs to be quite high, but from what others have said about JH in the past on this forum they're not the worst. Her company matches 50% of up to 4% (so she contributes 4% and they give her 2%, being 6% total) to her 401k. Currently she has a Roth IRA she just started this year (so the balance is less than $5K) for which she's planning on contributing maximum to every year. I have her putting her Roth IRA into LifeStrategy Growth (VASGX) based on the size of her balance and due to it matching the desired allocation the closest. Her goal is to put in 4% into her 401k, continue maximum contributions to her Roth IRA (wh...
by drs85
Fri May 11, 2012 10:36 am
Forum: Personal Finance (Not Investing)
Topic: buy from amazon or only fulfilled by amazon?
Replies: 14
Views: 18444

Re: buy from amazon or only fulfilled by amazon?

Being that I've sold things on Amazon, I can maybe put a little light on fulfillment orders. If an item is "Fulfilled by Amazon" that means the seller has already shipped the item to Amazon, and Amazon is keeping it stored in their warehouse waiting for someone to buy it. It costs more for the seller to do it this way, but it's more appealing to the buyer. Once someone buys it, then Amazon ships it out for the seller. Fulfilled orders do come with Amazon's A-Z protection, but I'm not entirely sure if you'd have to go through Amazon or the Seller to get an exchange/refund. For more information see:
http://www.amazon.com/gp/help/customer/ ... =200229160
by drs85
Fri May 11, 2012 9:22 am
Forum: Personal Investments
Topic: Roth or traditional 401k for me
Replies: 20
Views: 1648

Re: Roth or traditional 401k for me

livesoft wrote:And now it turns out that one can withdraw from the 401(k) (or convert it to a Roth IRA) without paying taxes if they plan right. That's right: 0% tax going in and 0% tax coming out. That's better than a Roth IRA or a Roth 401(k).
Just out of curiosity, how does one do that?
by drs85
Thu May 10, 2012 8:10 pm
Forum: Personal Investments
Topic: governmental 457b vs 403b?
Replies: 12
Views: 1875

Re: governmental 457b vs 403b?

sometimesinvestor wrote:I don't believe the last 3 points of drs85 points are valid for example some different 457B plans du have a Roth option (New York State for example and tyhhe option is relatively new so many plans have not yet begun to offer the option and I believe getting out after "termination " permits but does not require getting out and I did notice that he didn't seem positive so we need another opinion.
You're correct in that I'm not very positive. I should have been more clear (I will edit it) that those are just my understandings (I just started looking into it myself too) and I'm not entirely sure if they're correct (but would love corrections if they exist).
by drs85
Thu May 10, 2012 8:05 pm
Forum: Personal Investments
Topic: Roth or traditional 401k for me
Replies: 20
Views: 1648

Re: Roth or traditional 401k for me

Assuming you're at a 25% tax bracket at 64K you'd want to do Traditional now in hopes one day you can withdraw at the 15% tax bracket in retirement. Worst case is, even if you were still in the 25% tax bracket in retirement, you'd still be breaking even (no worse than if you contributed to the Roth option now). A couple other people have said to contribute into your Traditional up to your employer match (which is something you absolutely do), but the question of Traditional or Roth is simply: what do you think your tax bracket will be in the future, and do you have the crystal ball to knowing if the government will change those tax brackets in the next 30-40 years? Another consideration is: how much can you contribute? If you can contribute...
by drs85
Thu May 10, 2012 7:52 pm
Forum: Personal Investments
Topic: governmental 457b vs 403b?
Replies: 12
Views: 1875

Re: governmental 457b vs 403b?

I too have the option between a 403b and 457b; however I'm 26 and far from retirement. I am also in the same boat and can max out only one, and I have chosen to go with the 403b. My understanding of the main points between the two accounts are as follows: NOTICE: This is just how I understand the 403b vs 457b relationship, and I too just started researching this. Please take this all with a grain of salt. A 403b can be transfered to another 403b if you move from one educational institution to another. The same does not apply from a 403b to 401k (it used to, but not anymore). I just found this in my plan's documentation: When you receive a distribution from the Plan, it will normally be subject to income taxes. You may reduce or defer the ta...
by drs85
Wed May 09, 2012 9:58 am
Forum: Personal Investments
Topic: Combining Total Bond Fund and TIPS
Replies: 11
Views: 1954

Re: Combining Total Bond Fund and TIPS

I've often heard people on here say an even blend of 50/50 between TIPS to Total Bond is the way to go. In John Bogle's book "The Little Book of Common Sense Investing" he hints/suggests holding 10% of TIPS, and the rest at your asset allocation. I'm 26 years old, and I hold my age in bonds, so personally I have roughly 32% of my bond allocation in TIPS (10%), and the remainder in Total Bond (16%). According to Vanguard's performance charts from 2000 to 2011 US tips outperformed Total Bond 7 out of 12 years. Three of those years the results were close to even. I would think having a 50/50 allocation would work for me to smooth out the peaks and valleys of the bond portion of my portfolio. Another question I have is if I have 50% i...
by drs85
Sat May 05, 2012 4:11 pm
Forum: Personal Investments
Topic: Are 20 somethings handicapped bc of inflation and little SS?
Replies: 162
Views: 15579

Re: Are 20 something's screwed bc of inflation and little/no

Good to know you and I caught it young! And congrats for being so proactive in your future too! I seriously need to have a sit down with my friends and explain this to them because they just don't get it. Every time I explain to them why I can't go out and eat sushi every weekend or why I'm not buying a new car like them, they just roll their eyes at me... I've attempted to get my friends, coworkers, and even siblings to invest towards their retirement and I've found it is very hard convincing people of something that's so far away. I've heard every argument from "I'll just invest more later" to "the government wont let that happen." It's also hard convincing people to stop their current spending and save money for the ...
by drs85
Sat May 05, 2012 3:53 pm
Forum: Personal Investments
Topic: Are 20 somethings handicapped bc of inflation and little SS?
Replies: 162
Views: 15579

Re: Are 20 something's screwed bc of inflation and little/no

I'm 26 years old and I've realized this retirement concern many years ago and have been focusing on it ever since. There are a few other things you're not considering. Do keep in mind that your $1,036 savings per month is $1,036 FV more per month when you retire that you won't need (since you don't have it now anyways). So really, unless you already calculated that in, you wont need as much in retirement as you think. Usually you'll hear people say that you need about 70-80% of your income at retirement. The 20-30% accounts for the amount you were saving for that retirement, and perhaps the mortgage you should be paying off by retirement. Also keep in mind that once you retire you'll still be collecting (usually a much more conservative) am...
by drs85
Thu May 03, 2012 9:09 pm
Forum: Personal Investments
Topic: changing jobs - 403b question
Replies: 7
Views: 586

Re: changing jobs - 403b question

http://www.investopedia.com/ask/answers ... z1trYQoS1a

It looks like, at least in 2007, you can only contribute up to the maximum between both accounts. So my suggestion would be to contribute up to the match of your 403b, and then the rest to your 401k (as I'm assuming you don't know what the match/funds will be since you haven't interviewed yet).
by drs85
Thu May 03, 2012 8:58 pm
Forum: Personal Investments
Topic: changing jobs - 403b question
Replies: 7
Views: 586

Re: changing jobs - 403b question

The amount is now 17K/year (it's no longer 16.5K) to either a 401k and 403b. I'm not entirely sure if you can contribute the maximum to both, but my guess would be yes as I can contribute 17K to both a 403b and 457b offered through my employer as they're different accounts.

Other things to consider:
1. Make sure you don't have any vesting penalties on your 403b when leaving which would hurt your current contributions or employer matches.
2. Does your 401k at your new employer have a grace period where you cannot contribute for X months? If so, will that put you into next year anyways?
3. Does your employer who offers the 403b also offer a 457b (in the event you wanted to save even more)?
by drs85
Thu May 03, 2012 10:07 am
Forum: Investing - Theory, News & General
Topic: Do scientists invest scientifically?
Replies: 56
Views: 5081

Re: Do scientists invest scientifically?

investor1 wrote:I can't speak for scientists, but engineers are Bogleheads. Efficiency by way of low ERs and taxes. Consistency by way of a low volume of trades and dollar-cost averaging.

Set it and forget it. Anybody can do it.
+1

My background is Computer Science, and I would imagine this would apply to anyone in a mathematical field. The highest throughput is by the lowest ERs and taxes; it's simply logical.
by drs85
Tue May 01, 2012 7:47 pm
Forum: Personal Investments
Topic: What to do after 401k max and Roth max?
Replies: 24
Views: 3687

Re: What to do after 401k max and Roth max?

It sounds like you're in the same boat as me. I'm 26 years old maxing out my Roth IRA (5K), 403b (17K) and HSA. With the money I have in excess I'm currently putting it into a taxable account (being as tax efficient as I can with only contributing to Total Stock Market and Total International Stock Market); although I also have the option to contribute to a 457b through work. I like the idea of being able to access my Taxable account if a huge emergency arose. I am currently considering contributing some to my 457b too. If a 457b or similar plan isn't available to you (and it sounds like nothing like that is) I would suggest treating your whole portfolio as retirement and contributing tax-efficiently to a taxable account. If you need help w...
by drs85
Mon Apr 30, 2012 8:43 pm
Forum: Personal Investments
Topic: I-Bonds in the future
Replies: 7
Views: 1113

Re: I-Bonds in the future

sscritic wrote: You can only buy one max a year, so when you swap, you lose out on the max. If you buy only half the max each year, there is no problem.
Ah ha! I didn't even think about that. Thank you. :)
by drs85
Mon Apr 30, 2012 8:33 pm
Forum: Personal Investments
Topic: I-Bonds in the future
Replies: 7
Views: 1113

I-Bonds in the future

1. Say I purchase an I-Bond for $100 at today's fixed rate of 0%. Now, lets say the fixed rate increases 2 years from now (my existing I-Bond is then no longer affected by penalties or fees if I sold it) and I sell it, and then I turn around and buy the newer fixed rate. Is there anything "bad" about that, other than being "locked in" for another 12 months and realizing the gains?

2. Say I ladder purchases of I-bonds (eg: $200/mo for the next X years) with or without the method of #1. Is it a good idea to ladder I-bonds?
by drs85
Mon Apr 30, 2012 3:54 pm
Forum: Investing - Theory, News & General
Topic: can you lose admiral shares?
Replies: 10
Views: 15904

Re: can you lose admiral shares?

I just called Vanguard the other day with this same question. If you fall below the minimum Admiral balance (say $10,000) in any type of account they will notify you (it sounds like they send out notifications my snail mail every quarter) telling you to either contribute more, or it may drop to the Investor class. This is not a taxable event as it doesn't constitute a sale, but instead some inner-workings of Vanguard (basically it just changes the ER). They will also notify you if you go over the minimum letting you know that you can be upgraded by loggin into the website or calling them. This, again, is quarterly. If, however, you're on the brink of dropping below the minimum in an Investor class (say $3,000) the same notification will onl...
by drs85
Thu Apr 26, 2012 10:39 am
Forum: Investing - Theory, News & General
Topic: What's your % ROTH vs Tax differed in your portfolio
Replies: 43
Views: 2692

Re: What's your % ROTH vs Tax differed in your portfolio

Traditional 403b - 45%
Roth 403b - 3%
Roth IRA - 25%
Taxable - 27%

I am 26
by drs85
Tue Apr 24, 2012 9:45 pm
Forum: Investing - Theory, News & General
Topic: To TIPS or not to TIPS
Replies: 4
Views: 836

Re: To TIPS or not to TIPS

nisiprius wrote: TIPS would seem to be the most predictable of all investments other than series I savings bonds.
Thank you for your feedback! Are there index funds, or funds in general, which are composed mainly of series I savings bonds? Or is that a bond type I have to buy independently?
by drs85
Tue Apr 24, 2012 7:15 pm
Forum: Investing - Theory, News & General
Topic: To TIPS or not to TIPS
Replies: 4
Views: 836

To TIPS or not to TIPS

What are the cons of TIPS?
Are TIPS affected by increasing yields as much as other bonds?
What's percentage do you hold of TIPS in your retirement portfolio?
Are TIPS good for young investors (25-30)?
If you were to do it all over again, would you hold TIPS?
by drs85
Tue Apr 24, 2012 5:19 pm
Forum: Investing - Theory, News & General
Topic: Top factors in retirement planning
Replies: 9
Views: 1602

Re: Top factors in retirement planning

The one question I have is this, these papers are assuming income at 25 is the same as income at 70? In reality, most 25 year olds are making a relatively small amount as compared to later in life earnings. Let's say the 25 year old makes 50K a year and socks away 7% or $3,500. Now lets say at age 68, the pre-retiree is bringing in 3 times the amount or $150,000. Is the paper saying the pre-retiree by saving a consistent 7 percent of earnings over a working life can replace 80 percent of a $150,000 income? How? :confused The article never exactly says what year the retiree is expecting to expire, and thus as long as you have $150K in retirement I'd say you meet the expectations. However, assuming the rate of inflation is 3%, and for each y...
by drs85
Sun Apr 22, 2012 7:41 pm
Forum: Personal Investments
Topic: One-fund for 5-10 year investing
Replies: 3
Views: 547

Re: One-fund for 5-10 year investing

FNK wrote:Depends on the amount of complexity you're willing to stomach. The most efficient approach, at the cost of management overhead, is this:

http://www.bogleheads.org/wiki/Placing_ ... ed_Account
This is a very interesting approach. I don't mind a little bit of management, and this allows it to be very tax efficient with the wash rule. Thank you for pointing this out! :)
by drs85
Sun Apr 22, 2012 7:18 pm
Forum: Personal Investments
Topic: One-fund for 5-10 year investing
Replies: 3
Views: 547

One-fund for 5-10 year investing

I have my long-term retirement strategy all down and set in place. I also have an "emergency fund" of 6+ months in cash. I also have excess income which I would like to invest (non-retirement) in a taxable account to hopefully gain higher interest rates than what current banks offer (0.8%). I would like a fund where I can keep the assets for 5-10 years, and then eventually pull them out for a new vehicle, down payment on a house, mid-life crisis, epic vacation, etc. Ideally I would like the fund to have a lower level of risk (moderate-conservative), and be tax efficient at the 25% federal tax bracket (4.6% MI state, 1.5% city). Is there a particular fund you would recommend to keep my excess savings in?
by drs85
Sun Apr 22, 2012 6:42 pm
Forum: Personal Investments
Topic: 30 Year Old Couple Getting Back On Track!
Replies: 12
Views: 1546

Re: 30 Year Old Couple Getting Back On Track!

I see no one has commented on your questions yet, so hopefully I can just give some answers although I'm new to the boglehead way. 1. Even though I am still reading, I think we want to go with the three-fund approach to investing. I am having trouble figuring out how to best use the 401k funds to accomplish this. You're probably not going to be able to do a 3-fund approach exactly as it doesn't sound like her 401k offers a "Total Stock Market" type fund. However, I had the same issue and what I did was blended my 403b's S&P 500 fund (80%) with an Extended Market (which is small/medium funds, 20%) to essentially mimic a "Total Stock Market." It looks like her 401k has an S&P 500, but not an extended market or equi...
by drs85
Sat Apr 21, 2012 11:56 am
Forum: Investing - Theory, News & General
Topic: If you could hold only one fund, which one would it be?
Replies: 49
Views: 6699

Re: If you could only hold one fund, which one would it be?

I'd probably hold Vanguard Target Retirement 2045 Fund (VTIVX) based on my age (I'm 26), although I don't care too much for the 10% allocation to bonds. I may even go with something of a closer target just to increase the conservativeness of bond holdings closer to my age; say Vanguard Target Retirement 2030 Fund (VTHRX). These types of funds hold a broad level of 3-tier diversification of the TSM, TISM, and TBM. Unlike other company's "target funds", vanguard follows the boglehead approach very nicely. I have my 403b through Fidelity, and their target funds don't play as nice as Vanguard's as they are much more broad across many active and index funds. Fidelity's target funds, and this is just what I've noticed, have been underpe...
by drs85
Fri Apr 20, 2012 6:58 pm
Forum: US Chapters
Topic: Detroit Metro Chapter - Grand Opening
Replies: 27
Views: 4959

Re: Detroit Metro Chapter - Grand Opening

I'm interested in attending. I'm from Grand Rapids, MI.
by drs85
Fri Apr 20, 2012 2:48 pm
Forum: Personal Investments
Topic: Portfolio Allocation - Anything I'm Missing?
Replies: 10
Views: 1036

Re: Portfolio Allocation - Anything I'm Missing?

Since then, Vanguard increased Foreign allocation in Target Date Funds from 20% to 30% of Stocks (not of total portfolio). Great read! I'll allocate 30% of my stocks to be International. The final breakdown is as follows: Traditional 403b (contributing 24.8%/$17K) * Fidelity Spartan 500 Index Advtg 25.87% * Fidelity Spartan Extnd Mkt Idx Advtg 6.34% * Fidelity Spartan US Bond Idx Advtg 15.59% Roth IRA (contributing 7.3%/$5K) * Vanguard Total Stock Mkt Idx Adm 14.16% * Vanguard Inflation-Protected Securities Inv 10.25% Taxable Account (contributing 12.7%/$8.7K) * Vanguard Total Stock Mkt Idx Inv 5.36% * Vanguard Total Intl Stock Index Adm 21.43% Total Breakdown * Bonds (age): 26.84% of total * * Total Bond Market: 16.95% of total * * TIPS: ...
by drs85
Fri Apr 20, 2012 10:15 am
Forum: Personal Investments
Topic: Portfolio Allocation - Anything I'm Missing?
Replies: 10
Views: 1036

Re: Portfolio Allocation - Anything I'm Missing?

Thank you for everything so far! I'll work on calculating how much of a hit it would take to contribute maximum amounts to my Traditional 403b, and stop contributing to my Roth 403b. I should be able to do it, it'll just take away from my Taxable account contributions. I did some calculations to determine how much more (after taxes) it would take to fully contribute to my Traditional 403b of $17K and remove all current contributions from my Roth 403b. The after-tax difference from what I'm currently contributing was only $2100 annually, so that is completely doable. So my new goal is to fully contribute to a Traditional 403b, fully contribute to my Roth IRA, and then put the remainder into my Taxable account (which means this account will ...
by drs85
Fri Apr 20, 2012 9:08 am
Forum: Personal Investments
Topic: Portfolio Allocation - Anything I'm Missing?
Replies: 10
Views: 1036

Re: Portfolio Allocation - Anything I'm Missing?

Your homework: how did I compute those numbers? Thank you for getting back so quickly YDNAL. I don't mind posting the actual $ amounts of my contributions, I was just avoiding it because the Fourm Policy says only to use %. However, here's the actual breakdown (which was pretty close to what you said): Traditional 403b (work contribution) is ~$8196/yr Roth 403b (my contribution) is $9600/yr Roth IRA (my contribution) is $5000/yr Taxable (my contribution) is $10800/yr If you were actually asking how I think you computed the numbers, not to confirm the actual amounts, I would say the easiest way would have been to take my entire contribution % in my original post, subtract all the itemized contribution %s, and then the difference would be th...
by drs85
Fri Apr 20, 2012 7:24 am
Forum: Personal Investments
Topic: Portfolio Allocation - Anything I'm Missing?
Replies: 10
Views: 1036

Re: Portfolio Allocation - Anything I'm Missing?

1. Are you maxing out your 403b? $17k? If 12% of pre-tax income = $17K and you contribute the max to trad. 403B, that's one thing. That means you make $142K and the tax bracket then wouldn't make sense. Well, my work actually gives me the 12% into the Traditional 403b portion without me having to do anything, which doesn't count towards my maximum 17K contribution (from what I understand). On top of that is the 14% which I put into my Roth 403b. I'm currently contributing a little bit over 1/2 of the 17K allowance, and could add more funds to it if needed. It has been my intention to raise my contributions each year with any raises I get. I do not make $142K (although that would be awesome), and I can assure you I fall right under the 25% ...
by drs85
Thu Apr 19, 2012 8:33 pm
Forum: Personal Investments
Topic: Portfolio Allocation - Anything I'm Missing?
Replies: 10
Views: 1036

Portfolio Allocation - Anything I'm Missing?

I am kinda new to investing, at least to the concept of Bogleheads, and before now the only policy I had was save as much as I can for the end of the world. Hah. I have done a lot of research and I simply want to make sure what I'm planning on doing (until I die) is on track with the way of the Bogleheads. :) Here's my story: I am 26, almost 27 years old. I have an emergency fund of over 6 months worth of expenses, and possibly 8-12 if I handled it conservatively. My current job is secure and I've worked there for over 7 years. I do not have any debt as I've paid off my college loans and car loan almost immediately. I currently rent an apartment which is well below my means, and I split the rent with my girlfriend. My current tax filing sta...