Search found 555 matches

by bilperk
Thu Jul 21, 2022 12:31 pm
Forum: Personal Investments
Topic: Bank change at Treasury Direct
Replies: 3
Views: 503

Re: Bank change at Treasury Direct

Thanks. the account number and routing number are the same.
by bilperk
Thu Jul 21, 2022 11:24 am
Forum: Personal Investments
Topic: Bank change at Treasury Direct
Replies: 3
Views: 503

Bank change at Treasury Direct

So if my bank that I use for my account at TD, changes names (ie SunTrust to Truist) but the account number stays the same, will I need to change anything a TD to invest or withdraw?
by bilperk
Tue Jun 28, 2022 7:40 am
Forum: Investing - Theory, News & General
Topic: HY BulletShares
Replies: 1
Views: 815

HY BulletShares

How can the High Yield version BulletShares that have a maturity of Dec 22 have bonds that mature in 2028 in them?
by bilperk
Sat Jun 18, 2022 8:42 am
Forum: Investing - Theory, News & General
Topic: iShares iBonds investment-grade ETFs - what happens if bonds are downgraded?
Replies: 18
Views: 2506

Re: iShares iBonds investment-grade ETFs - what happens if bonds are downgraded?

My understanding is that any bonds that mature within 6 months of the end date are replaced with st reserves. It would seem if one bought the 2023 version, that the results might be less than expected?
by bilperk
Tue May 10, 2022 6:37 pm
Forum: Personal Investments
Topic: Living off of Dividends during volatility ... Strategy or Myth?
Replies: 93
Views: 6527

Re: Living off of Dividends during volatility ... Strategy or Myth?

To me, this is similar to saying active management wins when the market is down because it is another myth that is easily proven false. dividends in a mutual fund setting are nothing more than fund shares that you either choose to either reinvest or spend. If you choose to reinvest, your fund will have the same value with more shares. If you choose to spend the dividend, your fund value will drop by that dollar amount. If the market is dropping, then taking the dividend and spending it adds to the drop just the same as selling appreciated shares would. Dividends are just a warm fuzzy blanket, just like balanced funds, where you don't the full effect of stocks falling because it is mitigated by the bonds. Just because you don't see those div...
by bilperk
Mon May 02, 2022 9:08 am
Forum: Investing - Theory, News & General
Topic: SEC vs Distribution yield
Replies: 6
Views: 612

Re: SEC vs Distribution yield

MrJedi wrote: Mon May 02, 2022 8:39 am The formula uses share price as an input. This is how the the NAV of the bond fund influences the SEC yield. If rates go up, NAV goes down, share price goes down, then SEC yield goes up
Yet even with the drop in NAV, and the fact that the bonds are below par (97.83) the distribution yield based on the April 29 distribution and even today's price, the lowest in this year, is only .57%, nowhere near either the SEC at 2.3% or the average coupon of 1.2%. This is what I'm having difficulty understanding
by bilperk
Mon May 02, 2022 8:24 am
Forum: Investing - Theory, News & General
Topic: SEC vs Distribution yield
Replies: 6
Views: 612

Re: SEC vs Distribution yield

What I've been told here on the forum, although I haven't found this as the definition of SEC Yield elsewhere, is that "SEC Yield" for a bond fund is based on the Yield To Maturity of the portfolio. If interest rates go up, and the price of bonds in a existing portfolio go down, the amount of the distribution from those bonds doesn't change, but at maturity when the principal is returned it will amount to a bump up relative to the monthly coupon distributions, so there can be some lag in the monthly distributions to catch up with the current distribution yield on a new bond, some of it's total yield is built into it being purchased at a discount to its face value. Thanks. I just have never seen a 2% difference in the two yields f...
by bilperk
Mon May 02, 2022 8:01 am
Forum: Investing - Theory, News & General
Topic: SEC vs Distribution yield
Replies: 6
Views: 612

SEC vs Distribution yield

Can someone explain why the Vanguard short term treasury index has a distribution yield of between .35 and .5%, but a 30 day SEC yield of around 2.5%? What does that mean? What can a buyer today expect?
by bilperk
Sun Aug 22, 2021 12:41 pm
Forum: Investing - Theory, News & General
Topic: Why I'm leaving Vanguard
Replies: 220
Views: 38412

Re: Why I'm leaving Vanguard

Can you really no longer do Roth conversions online at Vanguard? Are you on the mutual fund platform or the brokerage platform? Are you accessing through the app or through the internet? On the brokerage platform, using a browser, you can do it online. I just use the “Exchange funds” feature and select the Roth account as the destination. Sounds like it can be done on both the MF and brokerage platform. I'm not looking do one, just surprised to read a comment saying that it could not be done. Maybe that was just meant to about the "instant" part, though. As of last January, you could not do a Roth conversion online if you wanted the tax withheld from the TIRA money. You had to call them and listen to their attitude. Eventually th...
by bilperk
Sun Aug 22, 2021 9:20 am
Forum: Investing - Theory, News & General
Topic: Why I'm leaving Vanguard
Replies: 220
Views: 38412

Re: Why I'm leaving Vanguard

Originally you were able to do things online, such as MF->ETF conversions, full POA designations, near-instant roth conversions, set DRIP to a different destination fund, etc. Slowly but surely, all these things have been taken away... Can you really no longer do Roth conversions online at Vanguard? Are you on the mutual fund platform or the brokerage platform? Are you accessing through the app or through the internet? On the brokerage platform, using a browser, you can do it online. I just use the “Exchange funds” feature and select the Roth account as the destination. Sounds like it can be done on both the MF and brokerage platform. I'm not looking do one, just surprised to read a comment saying that it could not be done. Maybe that was ...
by bilperk
Sun Mar 01, 2020 9:31 am
Forum: Investing - Theory, News & General
Topic: How Agg Bond Funds Reacted Last Week?
Replies: 14
Views: 838

Re: How Agg Bond Funds Reacted Last Week?

It appears to me that the agg bond funds (the likes of BND and BNDX) did not move up much last week during the stock rout. Am I misinformed? Just curious... Thanks for your responses. Bonds don't go up because stocks go down. Bond prices go up if the interest rates applicable to the duration of those stocks go down. I think bond prices have gone up some recently. The amount bond prices change is miniscule compared to the amount stock prices change. Bond holdings dilute the sensitivity of the portfolio to stock losses but do not offset those losses. To hedge or offset losses in one asset you need an asset that is as volatile as the first asset and perfectly anti-correlated with it. No such thing exists for stocks except short positions and ...
by bilperk
Thu Dec 19, 2019 5:26 pm
Forum: Investing - Theory, News & General
Topic: Indexing beats Wellington and Wellesley right?
Replies: 223
Views: 52957

Re: Indexing beats Wellington and Wellesley right?

When you compare Wellesley (37/63) to VBINX (60/40) index using portfolio visualizer since 2002, you will see that Wellesley outperformed the index slightly, with a lower SD, lower worst year, lower max drawdown, 50% higher Sharpe Ratio, and 50% higher Sortino. 17 years is a long time to outperform as it is, but to outperform an index that has 62% more equity for 17 years is pretty remarkable.
by bilperk
Mon Aug 12, 2019 8:15 pm
Forum: Investing - Theory, News & General
Topic: madsinger monthly report (July 2019)
Replies: 6
Views: 1622

Re: madsinger monthly report (July 2019)

I would assume whoever was giving him the numbers didn't this month.
by bilperk
Fri Apr 12, 2019 9:46 pm
Forum: Personal Investments
Topic: Wellesley Income fund Admiral
Replies: 17
Views: 3744

Re: Wellesley Income fund Admiral

Why are you in Wellesley if you are not retired? And if you are retired, spend the dividends and cap gains for expenses and pay the taxes at div and CG rates.
BTW, looks like you just joined today. Welcome to the Forum!
by bilperk
Sun Apr 07, 2019 10:08 am
Forum: Personal Investments
Topic: Grandparents gifting options for grandkids college
Replies: 48
Views: 4560

Re: Grandparents gifting options for grandkids college

Thinking about my BIL's family that will likely be eligible for need-based financial aid: If the grandparents gift the parents $10k and the parents immediately use that money to pay grandkids tuition, how does FAFSA treat that gift? My understanding is that the FAFSA doesn't count gifts to the parents as income, but does FAFSA capture the $10k as asset if is held for only a few days? I understand that if there is any EFC impact from the gift it would be two years in the future. Thanks! It depends on if the financial aid app has been submitted and whatever aid granted for that year. I believe it would possibly show up on the next application however. Frankly, I think the best option is the one the Grandparents are most comfortable with. Und...
by bilperk
Sun Mar 10, 2019 5:41 pm
Forum: Personal Finance (Not Investing)
Topic: Is this use of a 529 plan legitimate?
Replies: 6
Views: 885

Re: Is this use of a 529 plan legitimate?

It's legal to transfer moneys from i-bonds to a 529 for a dependent tax-free if the money is put into the 529 within 60 days of cashing the bonds. This is common practice. OK but your MAGI cannot exceed 89K or you start to phase out and the bond interest is considered income toward the MAGI. But if that is an issue, you can do it over several years if necessary. What you should understand is that, as a grandparent, any money given to the child or paid on his/her behalf will be considered untaxed income to the child when applying for financial aid. This can lower the student's aid by up to 50%. You can transfer ownership of the 529 to your child, but this will likely trigger at least gift tax reporting. And, of course, you lose control of t...
by bilperk
Sun Mar 10, 2019 4:20 pm
Forum: Personal Finance (Not Investing)
Topic: Is this use of a 529 plan legitimate?
Replies: 6
Views: 885

Re: Is this use of a 529 plan legitimate?

How do you plan to transfer the money from I-bonds to a 529 tax free? There are other issues with your plan but let's look at that one first. Have you been paying the I-bond taxes each year?
by bilperk
Wed Dec 12, 2018 8:18 am
Forum: Personal Investments
Topic: Vanguard Wellesly Income
Replies: 45
Views: 7656

Re: Vanguard Wellesly Income

The dividends on VWINX were not lowered during the recession of 2008-09. Jun 25, 2009 0.219 Dividend Mar 26, 2009 0.233 Dividend Dec 16, 2008 0.585 Dividend Sep 25, 2008 0.24 Dividend Jun 26, 2008 0.252 Dividend Mar 27, 2008 0.23 Dividend Dec 13, 2007 0.538 Dividend Sep 21, 2007 0.23 Dividend Jun 22, 2007 0.23 Dividend Mar 23, 2007 0.2 Dividend Dec 15, 2006 0.938 Dividend Sep 22, 2006 0.23 Dividend Jun 23, 2006 0.22 Dividend Mar 24, 2006 0.2 Dividend Dec 16, 2005 0.637 Dividend Sep 23, 2005 0.215 Dividend Jun 24, 2005 0.21 Dividend Those December distributions are mostly not dividends; they include capital gains as well, which do not represent income earned by the fund's bonds and stocks. The December distributions thus decreased after 200...
by bilperk
Sun Dec 09, 2018 9:39 am
Forum: Personal Investments
Topic: Vanguard Wellesly Income
Replies: 45
Views: 7656

Re: Vanguard Wellesly Income

Peter, Wellesley is a great fund. Right now might not be the best time, with FED raising rates, however. On the tax issue, don't let the tax tail wag the dog. If you need the yield income, then your tax will be at dividend rates, based on your income. Any money you take from selling shares of index funds as suggested will be taxed as ordinary income. While you will need to pay tax on capital gains with Wellesley, you have the option to take them in cash or reinvest them. Opinions differ, but a fund that generates capital gains on a regular basis means the managers are setting price goals and selling when they reach them. I consider this a good thing. As for 2008, there are things that happen once a lifetime, like the inflation in the 80's. ...
by bilperk
Sun Oct 21, 2018 9:47 am
Forum: Personal Finance (Not Investing)
Topic: 8 reasons why pensions are [good]
Replies: 67
Views: 7185

Re: 8 reasons why pensions are [good]

Easiest two would be you made A LOT less in retirement then you could if you invested the way you wanted for the last 40 years which had the greatest bull markets in stocks, bonds, and real estate history. Second is No money for heirs. The greatest advantage of being an American (good or bad) is the ability to build trans generational wealth. Most controversial which I would not expect from a U.S. government pension (state pensions and private are a different matter) is them changing the healthcare coverage and placing the cost of the premiums on the retiree. Already happened in our area when it comes to police and fire department health care costs so not a off limit topic as it has already happened. Good luck. 1) Not sure what assumptions...
by bilperk
Sun Jul 29, 2018 8:44 am
Forum: Personal Investments
Topic: FRS (Florida Retirement System) question
Replies: 13
Views: 2765

Re: FRS (Florida Retirement System) question

The OP should know that in 2017 the Florida Leg. changed the default retirement plan from the pension plan to the investment plan. This means unless you directly choose, you will be in the investment plan by default. Unfortunately, for many new employees, by the time your realize this, your one time switch to the pension plan may be too expensive to buy into (the difference between the pension value and the investment plan value).

In addition, employer contributions were increased, so along with less folks on the plan, the funding percentage should be increasing.
by bilperk
Sat Jul 28, 2018 8:04 am
Forum: Personal Investments
Topic: FRS (Florida Retirement System) question
Replies: 13
Views: 2765

Re: FRS (Florida Retirement System) question

The FRS is top 3 in the country for a pension plan. By what criteria? According to https://www.bloomberg.com/graphics/2017-state-pension-funding-ratios/ it isn't in the top 3 in funding ratios, and it doesn't seem to be among those with the highest benefits according to http://www.in.gov/legislative/publications/PensionStudyReport.pdf either. I just recieve our quarterly letter and it is 100% funding. Meaning it has enough money to pay pensions to retired and non retired employees. Maybe you are thinking Illinois is better. Also, never stated best benefits. But I am happy with my 90% pension and 3% COLA. Just checked email and I just recieve another 3 % cola raise, I will take it. Thank You. I agree, Florida is well funded. Even when they ...
by bilperk
Wed Jul 25, 2018 9:53 pm
Forum: Personal Investments
Topic: FRS (Florida Retirement System) question
Replies: 13
Views: 2765

Re: FRS (Florida Retirement System) question

I retired from the system in 2006, so some things may have changed. If she is still allowed to have a pension, then it will be either the pension or the investment plan. Independant from those would be her ability to contribute to a 457 type plan (might be different for teachers). The pension I have has an automatic cola of 3%. I believe the cola is lower now but still something. There is no match as they are funding both plans. There is not match with the 457 plan. You will have to check out the current vesting years for either plan. Florida would like to get everyone in the investment plan, and may not offer the pension to new employees at some point. This is the way most governments are going. If she can fund the 457, then the pension wi...
by bilperk
Fri May 25, 2018 6:47 am
Forum: Personal Investments
Topic: Florida Prepaid gift tax issues
Replies: 10
Views: 1406

Re: Florida Prepaid gift tax issues

WannabeAgAlum wrote: Thu May 24, 2018 7:45 pm Okay.

I'm guessing you thought of this, but is there no way to do two accounts with 14.5k each?

If not, you can still gift split with just one account but will need a 709 wherein you elect gift split with spouse.

Wannabe
No split, as with a 529, there can be only one owner. If it was a regular 529, we could just open two accounts at 14.5K each. But the prepaid plan does not allow more than one account per beneficiary, and only one way to lump sum without paying more.
by bilperk
Thu May 24, 2018 6:16 pm
Forum: Personal Investments
Topic: Florida Prepaid gift tax issues
Replies: 10
Views: 1406

Re: Florida Prepaid gift tax issues

WannabeAgAlum wrote: Thu May 24, 2018 5:58 pm Ah, I see it's a 529. Agreed.

If bilperk is married, bilperk and spouse can split the gift (up to $15k each) and avoid the 709.

Wannabe
It is not a 529. It is a program that allows you to prepay future college for someone at todays rates. There are several plans, like 4 year university, 4 year college, 2+2, and so on. The one I am choosing allows lump sum for about 29K, 5 year payments, or monthly. The last two would not be an issue with gift tax. I know with 529s there is some type of 5 year acceleration rule which allows you to lump the yearly gifts together in one year. I'm guessing this is what the 709 form is for. The program allows only one account owner, like a 529, so splitting won't work.
by bilperk
Thu May 24, 2018 4:48 pm
Forum: Personal Investments
Topic: Florida Prepaid gift tax issues
Replies: 10
Views: 1406

Re: Florida Prepaid gift tax issues

Thank you. I appreciate the response.
by bilperk
Thu May 24, 2018 4:18 pm
Forum: Personal Investments
Topic: Florida Prepaid gift tax issues
Replies: 10
Views: 1406

Florida Prepaid gift tax issues

I am likely going to do a lump sum next year in the Florida Prepaid program for one of my granddaughters. The amount for 4 year university program is about 29K. Is this considered a gift for tax purposes and since it exceeds the current allowed annual gift amount, will I have to file something on my taxes. Not looking for tax advice, just what others who may have done this may know.
by bilperk
Sun Feb 18, 2018 11:02 am
Forum: Investing - Theory, News & General
Topic: premium bonds
Replies: 7
Views: 863

Re: premium bonds

And they show Wellington's bonds at $106, so it is $100 par comparison. Maybe a typo on M*s part.
by bilperk
Sun Feb 18, 2018 11:00 am
Forum: Investing - Theory, News & General
Topic: premium bonds
Replies: 7
Views: 863

Re: premium bonds

lack_ey wrote: Sun Feb 18, 2018 10:22 am Where are you getting this figure, and are you sure it's relative to $100?

I wouldn't know where to look, but checking Vanguard's fund holdings page and the annual report, they do list face value and market value for bonds, and I'm not seeing a discrepancy like that.
Morningstar shows the average price of the bonds under the portfolio tab
by bilperk
Sun Feb 18, 2018 10:12 am
Forum: Investing - Theory, News & General
Topic: premium bonds
Replies: 7
Views: 863

Re: premium bonds

PFInterest wrote: Sun Feb 18, 2018 9:55 am Why would it be?
Well, it is a lot over par, and I don't see other bonds funds even close to that. Wellington is at $106.
by bilperk
Sun Feb 18, 2018 9:51 am
Forum: Investing - Theory, News & General
Topic: premium bonds
Replies: 7
Views: 863

premium bonds

I recently noticed that the bond sleeve for Wellesley has an average price of $160. Should that be a concern?
by bilperk
Sun Nov 12, 2017 4:33 pm
Forum: Personal Consumer Issues
Topic: Septic tank - deal killer?
Replies: 47
Views: 6741

Re: Septic tank - deal killer?

1) Go to the health department and find out if there are any records on the system (age, type, etc)
2) Go to the city and find out if you will be required to hook up or not.
3) If you would be required, try to get a good estimate of both hook-up fees and monthly service
4) Find out if there are any payment programs if you must hook up. Many cities have this.
5) See if you can get the seller to consider paying for half the hook up, particularly if the septic system fails inspection.
6) offer enough less for the house that you can connect yourself.

I have lived on septic and on sewer. Sewer is better.
by bilperk
Tue Oct 17, 2017 7:26 am
Forum: Investing - Theory, News & General
Topic: Roth as good as you think?
Replies: 29
Views: 4827

Re: Roth as good as you think?

It seems to me if two investment outcomes will end up with the same $ amount in the end (which may not be true anyway), but one has many other advantages, that going with the latter makes the most sense. I don't know anyone who actually takes the 15% savings and puts it in a taxable account, so as has been pointed out, both types generally receive the max allowed or at least the same. That $825 is dribbled back to you each pay period at about $32 per pay. Only a zealot is saving that. Having a large Roth allows one flexibility in tax planning in retirement. SS taxes can be mitigated perhaps. Buying a larger item, like a car, can push you into a higher tax bracket if using TIRA or in RMDs. Something that isn't mentioned much, but do we reall...
by bilperk
Sun Oct 15, 2017 10:35 am
Forum: Investing - Theory, News & General
Topic: Long term government index fund...
Replies: 2
Views: 507

Long term government index fund...

Anyone using or thinking of using this fund to help mitigate the eventual correction or recession? Back testing LT treasuries seems to show both SD reduction, worst outcome reduction, low correlation and at least comparable returns. It seems we always hear the LT treasuries are too risky, but in a portfolio, are they really?
by bilperk
Mon Aug 21, 2017 6:23 am
Forum: Investing - Theory, News & General
Topic: I own no international stocks. Can you guess why?
Replies: 167
Views: 29669

Re: I own no international stocks. Can you guess why?

Wow!! a total eclipse AND Taylor's answer in the same day. Yeaaaa!!! Ok, I'm off to poop.
by bilperk
Sun Aug 20, 2017 2:11 pm
Forum: Investing - Theory, News & General
Topic: I own no international stocks. Can you guess why?
Replies: 167
Views: 29669

Re: I own no international stocks. Can you guess why?

Taylor, my guess is good old recency bias. US Stocks have done so well in recent years that some Bogleheads believe there is no need for International. I believe this to be a mistake. I was just posting in another thread about the 1989 Japanese bubble and the subsequent burst. In 1989, Japanese investors could crow about their big multi-national companies that were the envy of the world, the number two economy in the world soon to overtake the US, and a stock market that performed so well that there was no need to invest anywhere else. Why would a Japanese investor own US Stocks when Japanese companies did so much business in the US? Why would Japanese investors take currency risk? As much as I like and respect John Bogle, I just think he ...
by bilperk
Sun Aug 20, 2017 11:17 am
Forum: Investing - Theory, News & General
Topic: I own no international stocks. Can you guess why?
Replies: 167
Views: 29669

Re: I own no international stocks. Can you guess why?

Taylor, my guess is good old recency bias. US Stocks have done so well in recent years that some Bogleheads believe there is no need for International. I believe this to be a mistake. I was just posting in another thread about the 1989 Japanese bubble and the subsequent burst. In 1989, Japanese investors could crow about their big multi-national companies that were the envy of the world, the number two economy in the world soon to overtake the US, and a stock market that performed so well that there was no need to invest anywhere else. Why would a Japanese investor own US Stocks when Japanese companies did so much business in the US? Why would Japanese investors take currency risk? As much as I like and respect John Bogle, I just think he ...
by bilperk
Sun Aug 20, 2017 11:00 am
Forum: Investing - Theory, News & General
Topic: I own no international stocks. Can you guess why?
Replies: 167
Views: 29669

Re: I own no international stocks. Can you guess why?

Because you put your assets In an Irrevocable Trust.
by bilperk
Fri Feb 10, 2017 3:57 pm
Forum: US Chapters
Topic: Your USER NAME...what does it mean?
Replies: 630
Views: 98293

Re: Your USER NAME...what does it mean?

my name is Bill and I'm an adult male :D
by bilperk
Thu Sep 01, 2016 6:06 pm
Forum: Personal Investments
Topic: How do you use your Vanguard Flagship rep’s services?
Replies: 2
Views: 1141

Re: How do you use your Vanguard Flagship rep’s services?

I have had a couple over the years. Only used them when they made a mistake and sent me distributions by mistake. They took care of it promptly. RMD's started this year. Just used the VG tool for that. All transactions done online without help or need for advice. All in all, not much difference than before I was Flagship except it is likely easier to get someone and they seem more willing to help if they can. Disclaimer: I don't have a brokerage and don't want one. If they eventually try to force me to, I may have to make a decision.
by bilperk
Fri Aug 05, 2016 6:14 pm
Forum: Investing - Theory, News & General
Topic: Rick Ferri's Bond Portfolio
Replies: 35
Views: 8974

Re: Rick Ferri's Bond Portfolio

mhalley wrote:Rick is one of the few that recommends HY bonds. Most bogleheads prefer to take their risk on the equity side of the portfolio, as HY can let you down ala 2008 when it was down 10%. Tips used to be favored more, but with the terrible yields and low inflation they don't seem to be as popular, and bogleheads have yet to embrace intl bonds, again feeling they are riskier than domestic.
Actually, Vanguard High Yield Bond Fund was down 21.3% in 2008. This may have had more to do with credit than equities though. It was actually up a little in the 2000-2002 crash IIRC.
by bilperk
Thu Jul 28, 2016 9:39 am
Forum: Personal Investments
Topic: 100 % Wellesley Admiral (VWIAX)?
Replies: 35
Views: 10230

Re: 100 % Wellesley Admiral (VWIAX)?

I have been retired about 10 years. I have 75% Wellesley, 10% Minimum volatility fund, and the other 15% in ST bonds, I bonds, cash. My AA ends up about the same as 100% Wellesley. I would have no problem with holding 100% Wellesley. However, I prefer to have a little more international and I prefer to have some cashy investments since I'm in RMDs and don't want to sell my Wellesley when its down. Of course, someone 100% could bank the dividends and use that for RMDs, but there are times I want a new car for cash or a new air conditioner so this works best for me. However, I also have a low withdrawal rate of about 2.5% so I can afford to be conservative.
by bilperk
Tue Jul 19, 2016 9:04 am
Forum: Personal Investments
Topic: IRA Wellesley only
Replies: 14
Views: 2739

Re: IRA Wellesley only

Ric, No one is answering you question, so I will answer it this way. The 200K of the 1.2 million is about 16%. You would really need to invest in something that you had conviction would have better returns over time, or why bother. So how much better return can you expect from something. Well from where I sit, you won't get any better return from a balanced fund like VTINX or LS funds. You might get better returns from a pure equity fund, like adding VEIPX ( Equity income) or High Dividend Yield fund but you are then going from 38% stock to 48% stock. And if received a 3% return premium over Wellesley, that would add less than 1/2% to your returns. And of course, a more risk. Getting 3% more return would mean a shift from historical return ...
by bilperk
Mon Jul 11, 2016 3:52 pm
Forum: Personal Investments
Topic: Thoughts on adding Wellesley to 3-Fund Portfolio in Roth IRA
Replies: 19
Views: 3044

Re: Thoughts on adding Wellesley to 3-Fund Portfolio in Roth IRA

I hadn't thought of replacing my BND with the Wellesley but that is an interesting idea. That increases my stock percentage and lowers my bond percentage which makes sense in the long run. Eventually the Fed will have to increase the interest rates and I don't want to be so heavy in bonds when it does. I also like the idea of the Wellington instead of the Wellesley. While this was my suggestion, I won't defend it too hard. There are many ways to get to 80/20 from where you are, including just selling 13% of your BND and buying 6 1/2% of each of the indexes. At your age, history tells us that having more equities will should give you a larger terminal pile. What equities you are in may or may not make a big difference, but likely it will be...
by bilperk
Mon Jul 11, 2016 9:17 am
Forum: Personal Investments
Topic: Thoughts on adding Wellesley to 3-Fund Portfolio in Roth IRA
Replies: 19
Views: 3044

Re: Thoughts on adding Wellesley to 3-Fund Portfolio in Roth IRA

What do you mean by "adding Wellesley in a smaller share"? How much are you considering? If you are willing to replace the 33% of BND with Wellesley, then your AA would be about 80/20 with a small value tilt. I don't see this as a bad idea, and would be surprised if you didn't end up with more $, possibly a lot more, after 40 years. Of course, you won't know for most of that time. I'm a yes
by bilperk
Fri Jul 08, 2016 1:45 pm
Forum: Investing - Theory, News & General
Topic: Annualized returns and growth of $10K
Replies: 13
Views: 1833

Re: Annualized returns and growth of $10K

Ok,thanks everyone. dbr, your numbers are pretty close to M*s by using the inception of high yield and then adding Wellesley to the chart. So I understand that the results were just based on a relatively small TR and a approx 38 year history. Thanks again to all who helped.
by bilperk
Fri Jul 08, 2016 9:28 am
Forum: Investing - Theory, News & General
Topic: Annualized returns and growth of $10K
Replies: 13
Views: 1833

Re: Annualized returns and growth of $10K

OK, but I just want to verify that part of the difference in the example is due to the fact that the NAV of the high yield fund has dropped 42% over the period, thus this years returns are based on a smaller base amount.
by bilperk
Fri Jul 08, 2016 9:16 am
Forum: Investing - Theory, News & General
Topic: Annualized returns and growth of $10K
Replies: 13
Views: 1833

Re: Annualized returns and growth of $10K

Thanks. Does the NAV erosion of high yield bond fund have a lot to do with this difference? It doesn't seem like a small difference in annualized returns should produce double the growth generally speaking.