Search found 982 matches

by Admiral
Tue Jan 23, 2018 1:39 pm
Forum: Personal Finance (Not Investing)
Topic: Can a 529 plan be used to pay for private tuition?
Replies: 19
Views: 789

Re: Can a 529 plan be used to pay for private tuition?

When you take a 529 plan withdrawal, the plan administrator asks you (online or when you call or send in a form) whether it is qualified or not. That data is reported on a 1099 filed by the administrator - sent to the account owner or the beneficiary and also to the Government. One can pay the expe...
by Admiral
Tue Jan 23, 2018 11:59 am
Forum: Personal Finance (Not Investing)
Topic: Can a 529 plan be used to pay for private tuition?
Replies: 19
Views: 789

Re: Can a 529 plan be used to pay for private tuition?

There are two interrelated questions as to State tax treatment of withdrawals used for the Federally acceptable private tuition. First question is whether State income tax treatment conforms to Federal income tax treatment - -i.e., if the gain for Federal taxes is not taxable, will a state also vie...
by Admiral
Tue Jan 23, 2018 11:33 am
Forum: Personal Finance (Not Investing)
Topic: Can a 529 plan be used to pay for private tuition?
Replies: 19
Views: 789

Re: Can a 529 plan be used to pay for private tuition?

I am kind of struggling with this too as I have a big private school bill coming too and I was considering, for cashflow purposes only, taking some money from our 529 plan and then putting it back in later this year. Not sure if this will be permitted but it seems like it should be. We're in Vanguar...
by Admiral
Mon Jan 22, 2018 4:07 pm
Forum: Investing - Help with Personal Investments
Topic: Ready to give up on bond fund, Lost 2.25% past 6 months
Replies: 76
Views: 7973

Re: Ready to give up on bond fund, Lost 2.25% past 6 months

and this is why i'm probably never owning bonds cash to buy dips/ CD's to actually lock in savings ... someone convince me otherwise, as I really struggle to see the appeal of bonds [i understand, less volatile] Because cash loses value to inflation and CDs have early withdrawal penalties. That's w...
by Admiral
Sun Jan 21, 2018 11:28 am
Forum: Investing - Help with Personal Investments
Topic: A 4-5% rebalance to bonds barely budges risk/return
Replies: 43
Views: 3201

Re: A 4-5% rebalance to bonds barely budges risk/return

past performance has no bearing on future results, i dont know if it matters what the difference was in the past This seems to overstate it a bit. It's imperfect but it's all we've got. SOMETHING has to drive our asset allocation strategies and if not historical returns, then what? Phases of the mo...
by Admiral
Sun Jan 21, 2018 8:34 am
Forum: Investing - Help with Personal Investments
Topic: A 4-5% rebalance to bonds barely budges risk/return
Replies: 43
Views: 3201

Re: A 4-5% rebalance to bonds barely budges risk/return

simplesimon wrote:
Sun Jan 21, 2018 8:24 am
What's considered meaningful to you? Where do you draw the line?
Well I think, in general, a .1 percent delta in average return is a rounding error. Though the difference in the worst possible year is a bit more meaningful.

livesoft: to what end?
by Admiral
Sun Jan 21, 2018 8:20 am
Forum: Investing - Help with Personal Investments
Topic: A 4-5% rebalance to bonds barely budges risk/return
Replies: 43
Views: 3201

A 4-5% rebalance to bonds barely budges risk/return

Like many, due to this run up I'm now 5% from my target asset allocation (or 75/25 instead of my target 70/30). Interestingly, using Vanguard's Portfolio Tester tool, if I exchange $35k worth of TSM for $35k of Total Bond, here are the results: Your current allocation Average return 9.3% Best year 4...
by Admiral
Sat Jan 20, 2018 8:20 pm
Forum: Investing - Help with Personal Investments
Topic: Roth favored over traditional in PA?
Replies: 10
Views: 411

Re: Roth favored over traditional in PA?

Also don't forget you can always defer the tax now and then convert to Roth when you have no earned income, and pay zero tax on the conversion to the top of the bottom bracket. Yes, at some point you will have to pay tax on some of the money, but you can control when that occurs. Again, assuming the...
by Admiral
Sat Jan 20, 2018 8:11 pm
Forum: Investing - Help with Personal Investments
Topic: Roth favored over traditional in PA?
Replies: 10
Views: 411

Re: Roth favored over traditional in PA?

obafgkm wrote:
Sat Jan 20, 2018 7:56 pm
Unless I'm missing something in this thread, it appears everybody is assuming that Pennsylvania has income tax on IRAs.

There is no Pennsylvania state income tax on IRA or 403(b) or 401(k) distributions.
Good point!
by Admiral
Sat Jan 20, 2018 7:40 pm
Forum: Investing - Help with Personal Investments
Topic: Roth favored over traditional in PA?
Replies: 10
Views: 411

Re: Roth favored over traditional in PA?

Hi Bogleheads, I've learned a lot from the forum, and thank you for sharing your thoughts and suggestions. I'd appreciate your advice about the choice between Roth and traditional 401(k). I know that the traditional is usually preferred for those in the 28% or higher brackets, but my situation is t...
by Admiral
Fri Jan 19, 2018 7:14 pm
Forum: Investing - Help with Personal Investments
Topic: Make me feel good about my bond allocation
Replies: 41
Views: 3850

Re: Make me feel good about my bond allocation

I think you will feel a lot better when the equity markets are tanking than when they are skyrocketing, as they have been. And that's "when" not "if."

And isn't that the point of the bond allocation, ultimately?
by Admiral
Fri Jan 19, 2018 12:22 pm
Forum: Investing - Help with Personal Investments
Topic: 457 worth it with these fees?
Replies: 47
Views: 1440

Re: 457 worth it with these fees?

Yes. I would then adjust my other accounts as part of my overall asset allocation. Did you know a nice feature of 457 plans is you can withdraw contributions any time without a 10% penalty. You do have to pay regular income taxes. Nice feature if you retire before 59.5. Regards, John John, do you k...
by Admiral
Thu Jan 18, 2018 6:39 pm
Forum: Personal Finance (Not Investing)
Topic: 1,000th post and a 'No-Fail' Retirement Formula
Replies: 47
Views: 4167

Re: 1,000th post and a 'No-Fail' Retirement Formula

This is why it will work 100% of the times. No-fail. TravelforFun Travel, how would you model the following scenario: Pension pays 40k per year, and begins paying out in 12 years, at age 60 (spouse's age). SS would add 70k per year, but would not begin until age 70 (so, ten years later). Clearly if...
by Admiral
Thu Jan 18, 2018 4:24 pm
Forum: Personal Finance (Not Investing)
Topic: 1,000th post and a 'No-Fail' Retirement Formula
Replies: 47
Views: 4167

Re: 1,000th post and a 'No-Fail' Retirement Formula

Based on your formula, my expenses divided by the portfolio size is a 2.4% withdrawal rate. That is way too conservative. I think this is a result of two factors. Choosing a SS age of 70 results in more years of using a portfolio based on 0% growth and using a 3% withdrawal rate on amounts after on...
by Admiral
Thu Jan 18, 2018 3:16 pm
Forum: Personal Finance (Not Investing)
Topic: 1,000th post and a 'No-Fail' Retirement Formula
Replies: 47
Views: 4167

Re: 1,000th post and a 'No-Fail' Retirement Formula

Based on your formula, my expenses divided by the portfolio size is a 2.4% withdrawal rate. That is way too conservative. I think this is a result of two factors. Choosing a SS age of 70 results in more years of using a portfolio based on 0% growth and using a 3% withdrawal rate on amounts after on...
by Admiral
Thu Jan 18, 2018 2:56 pm
Forum: Personal Finance (Not Investing)
Topic: 1,000th post and a 'No-Fail' Retirement Formula
Replies: 47
Views: 4167

Re: 1,000th post and a 'No-Fail' Retirement Formula

Maybe I'm a bit dense, but what are my "expenses before taxes" and how is that relevant? Seems only relevant as a percentage of pre- or after-tax income. My mortgage is $2,500/ month and my electric bill is $100 per month. How does my tax rate change those and all of my other expenses? In addition ...
by Admiral
Thu Jan 18, 2018 1:15 pm
Forum: Personal Finance (Not Investing)
Topic: 1,000th post and a 'No-Fail' Retirement Formula
Replies: 47
Views: 4167

Re: 1,000th post and a 'No-Fail' Retirement Formula

Maybe I'm a bit dense, but what are my "expenses before taxes" and how is that relevant? Seems only relevant as a percentage of pre- or after-tax income. My mortgage is $2,500/ month and my electric bill is $100 per month. How does my tax rate change those and all of my other expenses? In addition t...
by Admiral
Thu Jan 18, 2018 12:50 pm
Forum: Personal Finance (Not Investing)
Topic: Can We Retire in Hawaii? Please Critique
Replies: 145
Views: 12625

Re: Can We Retire in Hawaii? Please Critique

Just thinking outside the box, have you considered west coast of USA? Meaning somewhere outside of Portland OR in either OR or WA? Portland itself is prohibitively expensive, but if you get out of commuter range-ish, better. You have good local schools. You have nice people. You have a mild climate...
by Admiral
Wed Jan 17, 2018 1:04 pm
Forum: Investing - Theory, News & General
Topic: Will a bond sell-off be the catalyst for a Major Market Correction?
Replies: 13
Views: 1390

Re: Will a bond sell-off be the catalyst for a Major Market Correction?

The same pundits who predicted 8 of the last 5 big sell offs.

Wait around long enough and they are sure to be right.
by Admiral
Wed Jan 17, 2018 12:47 pm
Forum: Investing - Theory, News & General
Topic: The Flexible Retirement Planner
Replies: 14
Views: 1177

Re: The Flexible Retirement Planner

Good Morning - Longtime lurker and infrequent poster here. I am familiar with many of the free financial tools often referenced on the site (i.e. FIRECalc), but was wondering whether any posters are familiar with The Flexible Retirement Planner? I have been using it to model out different financial...
by Admiral
Tue Jan 16, 2018 9:32 pm
Forum: Personal Finance (Not Investing)
Topic: Can We Retire in Hawaii? Please Critique
Replies: 145
Views: 12625

Re: Can We Retire in Hawaii? Please Critique

If he needs that 3% withdrawal to pay the bills, what happens in a prolonged (5 year) downturn? You lost me here. Don't people routinely retire with 3% withdrawal rates. Surviving a 5 year downturn with a 3% withdrawal rate should not be that challenging. Especially with a huge guaranteed floor of ...
by Admiral
Tue Jan 16, 2018 8:03 pm
Forum: Personal Finance (Not Investing)
Topic: Can We Retire in Hawaii? Please Critique
Replies: 145
Views: 12625

Re: Can We Retire in Hawaii? Please Critique

Agree with marcpolo -- you are in a far better position than most are suggesting. Putting 20% down on an $800k house, you're left with ~$1M. Withdrawing ~3% per year and with your $14k surplus, your total annual housing costs would need to be less than $44k. Should be doable, though you may have to...
by Admiral
Tue Jan 16, 2018 7:47 pm
Forum: Personal Finance (Not Investing)
Topic: Can We Retire in Hawaii? Please Critique
Replies: 145
Views: 12625

Re: Can We Retire in Hawaii? Please Critique

Agree with marcpolo -- you are in a far better position than most are suggesting. Putting 20% down on an $800k house, you're left with ~$1M. Withdrawing ~3% per year and with your $14k surplus, your total annual housing costs would need to be less than $44k. Should be doable, though you may have to...
by Admiral
Tue Jan 16, 2018 7:20 pm
Forum: Personal Finance (Not Investing)
Topic: Can We Retire in Hawaii? Please Critique
Replies: 145
Views: 12625

Re: Can We Retire in Hawaii? Please Critique

Agree with marcpolo -- you are in a far better position than most are suggesting. Putting 20% down on an $800k house, you're left with ~$1M. Withdrawing ~3% per year and with your $14k surplus, your total annual housing costs would need to be less than $44k. Should be doable, though you may have to...
by Admiral
Tue Jan 16, 2018 2:54 pm
Forum: Personal Finance (Not Investing)
Topic: Term Life Insurance
Replies: 11
Views: 381

Re: Term Life Insurance

When does one decide that they no longer need term life insurance? Here's the basic scenario. Late forties dual income family House paid off No debt Kids nearly out of college (pre-funded) Net worth ~ 10x combined gross salary $800k policy costs about $90/mo (him) $500k policy costs about $40/mo (h...
by Admiral
Tue Jan 16, 2018 12:38 pm
Forum: Personal Finance (Not Investing)
Topic: Can We Retire in Hawaii? Please Critique
Replies: 145
Views: 12625

Re: Can We Retire in Hawaii? Please Critique

Average single house construction cost in Honolulu is $760 per square foot , so for $500,000 you are looking at a 640 square foot house. Doing it yourself will be somewhat less, but permits and materials will, as you know, be quite dear. Also, building to earthquake & hurricane code can be a bit tr...
by Admiral
Tue Jan 16, 2018 11:31 am
Forum: Investing - Theory, News & General
Topic: A 4% move in the Dow and S&P in 12 days? Seems odd
Replies: 94
Views: 7455

Re: A 4% move in the Dow and S&P in 12 days? Seems odd

The problem with facile explanations of changes is that they often don't fit the data. International Stocks are up more than US stocks. How does US corporate tax law changes explain that? The OP didn't ask about intl stocks, and therefore my response did not address their rise. No, but you gave an ...
by Admiral
Tue Jan 16, 2018 11:08 am
Forum: Personal Finance (Not Investing)
Topic: Can We Retire in Hawaii? Please Critique
Replies: 145
Views: 12625

Re: Can We Retire in Hawaii? Please Critique

There's also a distinction to be made between "can we" and "should we."

Can you? Possibly. Should you? Likely not.

Also what are you planning to do all day with retirement at 50? Surf? There are cheaper places to live with decent surf breaks.
by Admiral
Tue Jan 16, 2018 11:04 am
Forum: Investing - Theory, News & General
Topic: A 4% move in the Dow and S&P in 12 days? Seems odd
Replies: 94
Views: 7455

Re: A 4% move in the Dow and S&P in 12 days? Seems odd

Geologist wrote:
Tue Jan 16, 2018 10:59 am
The problem with facile explanations of changes is that they often don't fit the data. International Stocks are up more than US stocks. How does US corporate tax law changes explain that?
The OP didn't ask about intl stocks, and therefore my response did not address their rise.
by Admiral
Tue Jan 16, 2018 10:54 am
Forum: Investing - Theory, News & General
Topic: A 4% move in the Dow and S&P in 12 days? Seems odd
Replies: 94
Views: 7455

Re: A 4% move in the Dow and S&P in 12 days? Seems odd

Here's all you need to know (from the chart that was posted): The average Bull Market period lasted 9.0 years with an average cumulative total return of 480%. The average Bear Market period lasted 1.4 years with an average cumulative loss of -41% Why would you assume that a big corporate tax cut wou...
by Admiral
Tue Jan 16, 2018 7:05 am
Forum: Personal Finance (Not Investing)
Topic: Can We Retire in Hawaii? Please Critique
Replies: 145
Views: 12625

Re: Can We Retire in Hawaii? Please Critique

My take: No. You're not even close. You're talking about going into retirement with either a) a big mortgage or c) a cash payment for a home-plus-land that will deplete ALL your taxable reserves. And...KIDS! Your kids are tiny. Kids are expensive, and so is college. Hawaii, too, is an expensive plac...
by Admiral
Sun Jan 14, 2018 9:45 am
Forum: Investing - Theory, News & General
Topic: Why Buy Bonds If You Have A Mortgage?
Replies: 187
Views: 17467

Re: Why Buy Bonds If You Have A Mortgage?

As usual, Grabiner, I don't think I'm smart enough to understand the nuances of your response. But as I see it, for this discussion you have two options with an extra $1000 per month: You can pay down a mortgage, earning the fixed mortgage rate pf return; or You can invest the money in an investmen...
by Admiral
Sat Jan 13, 2018 12:36 pm
Forum: Investing - Theory, News & General
Topic: Why Buy Bonds If You Have A Mortgage?
Replies: 187
Views: 17467

Re: Why Buy Bonds If You Have A Mortgage?

Compare the following four options: A: $100K mortgage, $280K stocks, $220K bonds B: No mortgage, $280K stocks, $120K bonds C: $100K mortgage, $350K stocks, $150K bonds D: No mortgage, $350K stocks, $50K bonds Do you prefer C or D? They have the same risk; you will lose $175K either way if the stock...
by Admiral
Sat Jan 13, 2018 9:19 am
Forum: Investing - Theory, News & General
Topic: Why Buy Bonds If You Have A Mortgage?
Replies: 187
Views: 17467

Re: Why Buy Bonds If You Have A Mortgage?

I don't follow your logic. Just because I am willing to put SOME money at risk does not mean (and it does not follow logically) that I am willing to put ALL money at risk. That's the point of an investment plan and an asset allocation strategy. The issue is that you are comparing options with diffe...
by Admiral
Fri Jan 12, 2018 6:45 am
Forum: Investing - Theory, News & General
Topic: Why Buy Bonds If You Have A Mortgage?
Replies: 187
Views: 17467

Re: Why Buy Bonds If You Have A Mortgage?

But this isn't a fair comparison ... you are comparing the investing in stocks to that of the risk-less investment in what is essentially a bond. Of course if you just look at the average or statistical expectation, the risky asset will come out ahead ... but by doing this you are completely ignori...
by Admiral
Thu Jan 11, 2018 4:18 pm
Forum: Investing - Theory, News & General
Topic: Why Buy Bonds If You Have A Mortgage?
Replies: 187
Views: 17467

Re: Why Buy Bonds If You Have A Mortgage?

Admiral, I think you're now confounding all risk levels no matter how remote e.g another housing crash vs the inherent year by year real risk of stocks (where historically 1/3 of the years we have a loss). If you follow your arguments to their logical conclusion, you will conclude that the only thi...
by Admiral
Thu Jan 11, 2018 10:55 am
Forum: Investing - Theory, News & General
Topic: Why Buy Bonds If You Have A Mortgage?
Replies: 187
Views: 17467

Re: Why Buy Bonds If You Have A Mortgage?

There is no rational financial argument for paying down a mortgage over saving that money in tax advantaged space. The former saves you the relatively low interest rate of your loan. The latter saves you 15, 22, 25, 28%....whatever your fed tax rate is. The tax savings is not a return, because you ...
by Admiral
Thu Jan 11, 2018 10:35 am
Forum: Investing - Theory, News & General
Topic: Why Buy Bonds If You Have A Mortgage?
Replies: 187
Views: 17467

Re: Why Buy Bonds If You Have A Mortgage?

There is no rational financial argument for paying down a mortgage over saving that money in tax advantaged space. The former saves you the relatively low interest rate of your loan. The latter saves you 15, 22, 25, 28%....whatever your fed tax rate is. The tax savings is not a return, because you ...
by Admiral
Thu Jan 11, 2018 9:52 am
Forum: Investing - Theory, News & General
Topic: Why Buy Bonds If You Have A Mortgage?
Replies: 187
Views: 17467

Re: Why Buy Bonds If You Have A Mortgage?

Thank you for your comments. You're basically making the liquidity argument again. I'm in total agreement with you that one must have "sufficient" cash emergency funds and/or other liquid assets around to weatherr a crisis. Several people including yourself have alluded to the folly of paying of lo...
by Admiral
Wed Jan 10, 2018 7:10 pm
Forum: Personal Consumer Issues
Topic: House water detection and alert system?
Replies: 41
Views: 2518

Re: House water detection and alert system?

Hi, I live in the northeast where the risk of pipe burst is a real concern. I have seen and heard others who has their whole house flooded. Are there technologies/products out there that will alert me whenever water is detected? I know there are $10 water sensor I can get from HomeDepot, but that d...
by Admiral
Wed Jan 10, 2018 3:23 pm
Forum: Investing - Help with Personal Investments
Topic: Sequence of Return Risk impact on Retirement
Replies: 103
Views: 4286

Re: Sequence of Return Risk impact on Retirement

I entered your data into cfiresim.com. Retirement start 2022 (age 62), end 2055 (age 95). Portfolio value $1.6M, 60/40. Spending $60k adjusted for inflation. Rebalance until 2022. Then target asset 100% equities start 2022 (at retirement), end 2030 (8 yrs later, to simulate spending down all bonds)...
by Admiral
Wed Jan 10, 2018 3:10 pm
Forum: Investing - Help with Personal Investments
Topic: Sequence of Return Risk impact on Retirement
Replies: 103
Views: 4286

Re: Sequence of Return Risk impact on Retirement

I entered your data into cfiresim.com. Retirement start 2022 (age 62), end 2055 (age 95). Portfolio value $1.6M, 60/40. Spending $60k adjusted for inflation. Rebalance until 2022. Then target asset 100% equities start 2022 (at retirement), end 2030 (8 yrs later, to simulate spending down all bonds)...
by Admiral
Wed Jan 10, 2018 12:59 pm
Forum: Investing - Theory, News & General
Topic: Why Buy Bonds If You Have A Mortgage?
Replies: 187
Views: 17467

Re: Why Buy Bonds If You Have A Mortgage?

Run the numbers with different tax rates and return expectations. You'll find that for many people, bonds in taxable is best. I don't need to do that. I have the wiki: https://www.bogleheads.org/wiki/Tax-efficient_fund_placement The wiki's advice does not hold in all situations, not by a long shot....
by Admiral
Wed Jan 10, 2018 12:31 pm
Forum: Investing - Theory, News & General
Topic: Why Buy Bonds If You Have A Mortgage?
Replies: 187
Views: 17467

Re: Why Buy Bonds If You Have A Mortgage?

Run the numbers with different tax rates and return expectations. You'll find that for many people, bonds in taxable is best. I don't need to do that. I have the wiki: https://www.bogleheads.org/wiki/Tax-efficient_fund_placement The wiki's advice does not hold in all situations, not by a long shot....
by Admiral
Wed Jan 10, 2018 11:38 am
Forum: Investing - Theory, News & General
Topic: Why Buy Bonds If You Have A Mortgage?
Replies: 187
Views: 17467

Re: Why Buy Bonds If You Have A Mortgage?

willthrill81 wrote:
Wed Jan 10, 2018 11:29 am
Run the numbers with different tax rates and return expectations. You'll find that for many people, bonds in taxable is best.
I don't need to do that. I have the wiki:

https://www.bogleheads.org/wiki/Tax-eff ... _placement
by Admiral
Wed Jan 10, 2018 11:25 am
Forum: Investing - Theory, News & General
Topic: Why Buy Bonds If You Have A Mortgage?
Replies: 187
Views: 17467

Re: Why Buy Bonds If You Have A Mortgage?

I don't hold bonds in a taxable account, nor should most people, unless they are munis, which have a low yield, nor do I intend to borrow against my home. I also hold Total Bond Index, which is medium duration not long duration. Actually, it can be optimal to hold bonds in taxable accounts. See her...
by Admiral
Wed Jan 10, 2018 11:10 am
Forum: Investing - Theory, News & General
Topic: Why Buy Bonds If You Have A Mortgage?
Replies: 187
Views: 17467

Re: Why Buy Bonds If You Have A Mortgage?

Exactly. Those who are choosing between fully funding their retirement plans and paying down a mortgage have something to think about here. There is no rational financial argument for paying down a mortgage over saving that money in tax advantaged space. The former saves you the relatively low inte...
by Admiral
Wed Jan 10, 2018 11:05 am
Forum: Investing - Theory, News & General
Topic: Why Buy Bonds If You Have A Mortgage?
Replies: 187
Views: 17467

Re: Why Buy Bonds If You Have A Mortgage?

Certainly if one can avoid going into retirement with a mortgage, that is desirable. And if you are referring to your own situation, you'd be wiser to re-fi to a 15 year note than to pay down your current note, so that in 12 years your note will have a MUCH smaller balance remaining. You could then...
by Admiral
Wed Jan 10, 2018 9:56 am
Forum: Investing - Theory, News & General
Topic: Why Buy Bonds If You Have A Mortgage?
Replies: 187
Views: 17467

Re: Why Buy Bonds If You Have A Mortgage?

Haven't seen it mentioned, and may not be a concern for some. A large mortgage is the most effective form of asset protection available for your personal residence. This is only a benefit if the money which would otherwise be used to pay down the mortgage is itself asset-protected, such as in a 401...
by Admiral
Wed Jan 10, 2018 9:53 am
Forum: Investing - Theory, News & General
Topic: Why Buy Bonds If You Have A Mortgage?
Replies: 187
Views: 17467

Re: Why Buy Bonds If You Have A Mortgage?

There is no rational financial argument for paying down a mortgage over saving that money in tax advantaged space. The former saves you the relatively low interest rate of your loan. The latter saves you 15, 22, 25, 28%....whatever your fed tax rate is. Even in scenarios like 2000-2009, assuming yo...