Search found 87 matches

by Carbonate24
Sat Sep 24, 2022 1:58 pm
Forum: Investing - Theory, News & General
Topic: My favorite online SWR calculators
Replies: 5
Views: 1162

Re: My favorite online SWR calculators

Came across this post today, listing various tools that - amongst other things - provide SWR calculators. I've had a bit of trouble trying to figure out if the results are real or nominal....I think I've figured it out, and there is some commentary in this regard in tool notes, but if anyone already happens to have a quick summary, can they post it please?
by Carbonate24
Sun Aug 07, 2022 11:21 pm
Forum: Personal Investments
Topic: Donor Advised Fund (DAF) Newbie Questions
Replies: 31
Views: 2767

Re: Donor Advised Fund (DAF) Newbie Questions

I have gotten some very helpful feedback here......I am glad I posted this - certainly helps jump start my journey.
by Carbonate24
Sun Aug 07, 2022 9:34 pm
Forum: Personal Investments
Topic: Donor Advised Fund (DAF) Newbie Questions
Replies: 31
Views: 2767

Re: Donor Advised Fund (DAF) Newbie Questions

The relative did not leave written guidance.....he just told me verbally to use it wisely (do my due diligence, worthy causes, etc). He donated primarily to his church, and then one-off distributions in time of need (like a natural disaster). I've solicited opinions of close family members, but they all said they would be comfortable with what I select (those family members have no official role in the DAF.....I just sought them out for ideas).

As far as timeframe, my planning basis so far is to distribute between 5% and 10% per year.......but that's just a striating point as I hone in on a better distribution plan.
by Carbonate24
Sun Aug 07, 2022 8:35 pm
Forum: Personal Finance (Not Investing)
Topic: Inherited Roth IRAs
Replies: 16
Views: 2114

Re: Inherited Roth IRAs

The ROTH is not in a trust. I was the beneficiary of the ROTH IRA.
by Carbonate24
Sun Aug 07, 2022 7:37 pm
Forum: Personal Finance (Not Investing)
Topic: Inherited Roth IRAs
Replies: 16
Views: 2114

Re: Inherited Roth IRAs

OP here....no, I am not an EDB per the guidelines.
by Carbonate24
Sun Aug 07, 2022 4:00 pm
Forum: Personal Finance (Not Investing)
Topic: Inherited Roth IRAs
Replies: 16
Views: 2114

Inherited Roth IRAs

I have recently inherited a ROTH IRA. As part of my long-term planning, as I set about studying the rules of inherited ROTH IRAs, I also cracked open my IPS to see if any changes might be warranted. As I am sure many of you know, the rules are not only different for inherited IRAs, there has been some new rules issued recently. So, in addition to referring to the IRS website, I looked through various posts on this site, as well as various news articles. The key change in the new rules I zeroed in on was annual RMDs over 10 years, versus being able to delay distributions. Perhaps because this situation is fluid, there are conflicting messages in what I've read. I can't tell if (1) the new rules are not in full effect, (2) the new rules are i...
by Carbonate24
Sun Aug 07, 2022 2:59 pm
Forum: Personal Investments
Topic: Donor Advised Fund (DAF) Newbie Questions
Replies: 31
Views: 2767

Re: Donor Advised Fund (DAF) Newbie Questions

Posting a follow-up to my own question....... Back in February, I posted a few questions regarding Donor Advised Funds (DAF). I got some good feedback, thank you. I still have one area I am struggling with. Quick Summary: A relative passed away and made me the successor custodian to a DAF. I have completed processing all the paperwork, and I am now set up as the (sole) custodian of the DAF (and I have designated my sister as the successor custodian). Combining the assets that were already in the DAF with the Traditional IRA assets that recently been added to the account, the size is pretty large (from my perspective). There is about $2 million in DAF currently, invested in total market index type fund. The original feedback to my question b...
by Carbonate24
Sun Mar 20, 2022 12:05 pm
Forum: Personal Finance (Not Investing)
Topic: Advice on Distribution of Significant Personal Effects After Death in Family
Replies: 25
Views: 2664

Re: Advice on Distribution of Significant Personal Effects After Death in Family

Some very helpful advice, thank you! One other "rule" we considered is "If you bought it for them, or made it for them, you get it back" [Two examples, one sister bought a pewter dish in Norway for our dad, so she gets that back. My other sister made a jewelry box out of seashells collected on a trip with mom....she gets that back]. I am pretty sure that we won't end up with a lot of leftover items. Many of the "things" are unique, but not necessarily valuable($). We lived in so many places, and went on lots of trips that we just ended up with a lot of "stuff". Due to the nature of my father's work, the vast majority of the trips were not to touristy places, so a lot of the items are quite unique. My ...
by Carbonate24
Sat Mar 19, 2022 7:09 pm
Forum: Personal Finance (Not Investing)
Topic: Advice on Distribution of Significant Personal Effects After Death in Family
Replies: 25
Views: 2664

Advice on Distribution of Significant Personal Effects After Death in Family

Topic: Seeking advice on a process to distribute significant personal/household effects after death of parent Background: My father passed away in his mid-90's in January of this year. My mother passed away in 2016. There are three kids, all living...myself and and my 2 sisters. I have 2 kids, my younger sister has no kinds, and my older sister has 9 kids/grandkids. I am the executor of the estate and I am currently in the process of overseeing distribution of financial assets as well as physical belongings. The financial assets are significant, but fortunately the Wills/Trusts language makes it crystal clear on how to handle those. My father's Will is silent on distribution of personal effects (He didn't forget about it, he just never tho...
by Carbonate24
Wed Feb 23, 2022 7:22 pm
Forum: Personal Investments
Topic: Donor Advised Fund (DAF) Newbie Questions
Replies: 31
Views: 2767

Re: Donor Advised Fund (DAF) Newbie Questions

Thank you all - very helpful info to kick-start my education and action plan.

To answer a question above, at this time, there is not a successor to my role, but I guess I can designate that person....again much to learn.
by Carbonate24
Wed Feb 23, 2022 12:00 am
Forum: Personal Investments
Topic: Donor Advised Fund (DAF) Newbie Questions
Replies: 31
Views: 2767

Re: Donor Advised Fund (DAF) Newbie Questions

The DAF resides at Ayco/Goldman Sachs,...specifically at the Ayco Charitable Trust Foundation.
by Carbonate24
Tue Feb 22, 2022 9:06 pm
Forum: Personal Investments
Topic: Donor Advised Fund (DAF) Newbie Questions
Replies: 31
Views: 2767

Donor Advised Fund (DAF) Newbie Questions

A relative passed away recently and named me as successor account advisor (...or, whatever the proper term is...) for their Donor Advised Fund. The person had discussed this with me before they passed, and they shared the reasons they set it up, intent, and that they trusted me to continue making distributions as I see fit. Their Traditional IRA also named this DAF as the sole beneficiary....so the assets are considerable (from my perspective). I need to dive into the specifics and get up to speed.....but I also want to make series to charitable gifts in the near future to honor my relative. With that in mind, I'd appreciate input on a few quick questions while I embark on a longer-term learning process about DAFs: (1) Any recommendations f...
by Carbonate24
Sun Dec 05, 2021 11:06 am
Forum: Personal Investments
Topic: Suggestion for BH posts on Inflation?
Replies: 6
Views: 1008

Re: Suggestion for BH posts on Inflation?

Thanks - JBTX/Sandtrap - that definitely gets me kickstarted!
by Carbonate24
Sat Dec 04, 2021 1:57 pm
Forum: Personal Investments
Topic: Suggestion for BH posts on Inflation?
Replies: 6
Views: 1008

Suggestion for BH posts on Inflation?

Question : Looking for recommendations of 2 or 3 really good posts about inflation protecting your portfolio since I've been dormant on this site for a while.... Background :I was somewhat active on this site a few years ago, when I developed my IPS (very similar to many of yours with just 3 ETF, rebalance bands, etc). I implemented and stuck to my IPS which really just ran on autopilot (I keep putting $ in, rarely take it out), and the assets have grown. Since things were on autopilot, I spent less time working on investing topics (studying different stocks, looking at predictions, ....) and more time doing things I like (yeah! more time with kids, sports, etc). My portfolio just kept doing it's thing in the background, per my IPS, and I ...
by Carbonate24
Wed Apr 01, 2020 2:03 pm
Forum: Investing - Theory, News & General
Topic: Comfortable holding ITOT and/or SCHB “forever” ?
Replies: 6
Views: 1380

Re: Comfortable holding ITOT and/or SCHB “forever” ?

My unexpected windfall was large...all invested in VTI, and so my current loss is large as well....would allow me to get out of all but 3 of my individual stock holdings.
by Carbonate24
Wed Apr 01, 2020 1:22 pm
Forum: Investing - Theory, News & General
Topic: Comfortable holding ITOT and/or SCHB “forever” ?
Replies: 6
Views: 1380

Comfortable holding ITOT and/or SCHB “forever” ?

I have general question about whether you feel comfortable holding ITOT and/or SCHB forever….. 
Background: I consider myself a novice investor always working to learn and get better. Prior to finding this site (and prior to reading numerous books BH Guide to Investing, etc..) I primarily bought individual stocks that I picked. After becoming more informed, I started putting my money nearly exclusively into VTI and VXUS. I’ve gotten very comfortable holding these Vanguard ETFs forever (including buying them in my kids custodial accounts with horizons of many many decades). Due windfall about a year ago, I put a chunk of money into VTI (in my taxable account), and that VTI lot currently has a sizable loss. I’d like to sell that VTI and TLH w...
by Carbonate24
Sun Sep 29, 2019 4:09 pm
Forum: Investing - Theory, News & General
Topic: Excel Monte Carlo : Bond Modeling Question
Replies: 10
Views: 1200

Re: Excel Monte Carlo : Bond Modeling Question

Thank you LadyGeek! I had not come across that before.....will certainly toy around with that.....
by Carbonate24
Sun Sep 29, 2019 1:46 pm
Forum: Investing - Theory, News & General
Topic: Excel Monte Carlo : Bond Modeling Question
Replies: 10
Views: 1200

Re: Excel Monte Carlo : Bond Modeling Question

Thanks for the input. The bond modeling is just a piece of my model.....not the end game. The end game is to model cash flow from all of my assets and assess impacts of stress tests (inflation, market crash, etc)....and model withdrawal rate, and other key metrics. When I get my model up and running, I would use it to compare to other available models and tools (firecalc, etc). My model does allow me to incorporate some unique aspects of my financial situation. I am comfortable with the equities portion of my model using mean/std dev. It's bond piece I am thinking through, especially since I will be holding the bonds to maturity. I am nearing retirement (or past financial independence and thinking of quitting!) and I plan to live off divide...
by Carbonate24
Sat Sep 28, 2019 6:33 pm
Forum: Investing - Theory, News & General
Topic: Excel Monte Carlo : Bond Modeling Question
Replies: 10
Views: 1200

Excel Monte Carlo : Bond Modeling Question

I am building a monte carlo simulator in Excel and I would appreciate some thoughts from any spreadsheet/math geeks on how I am modeling my bonds. Background: I do not have any bond funds/ETFs…..my fixed income portfolio is comprised of individual bonds, the vast majority of which are US Government, and the balance a few high quality corporate bonds. So far, I have been using the excel formula NORM.INV(RAND(),x,y) Where x is mean and y is standard deviation. For example, I have utilized from Ferri’s 30 year forecast: US T-Bills Nominal Return 2.1%, Standard Deviation 2% & US 10 yr note Nominal Returns 3.9%, Standard Deviation 7% However, I am wondering, if I assume that I will hold the bonds to maturity, and all I am really trying to do...
by Carbonate24
Wed Sep 25, 2019 8:29 pm
Forum: Personal Finance (Not Investing)
Topic: Experience with Blue Cross Blue Shield Texas ?
Replies: 6
Views: 958

Re: Experience with Blue Cross Blue Shield Texas ?

Some pretty helpful, and worrisome, feedback.... thanks for sharing.
by Carbonate24
Tue Sep 24, 2019 2:00 pm
Forum: Personal Finance (Not Investing)
Topic: Experience with Blue Cross Blue Shield Texas ?
Replies: 6
Views: 958

Experience with Blue Cross Blue Shield Texas ?

Interested in your feedback, good or bad, about using Blue Cross Blue Shield HMO option in Texas. Background : I am thinking hard about quitting my job and retiring early. I can be covered under COBRA until it times out. I have a family of four. We have been on Aetna PPO for many years. For the purpose of this post, I am ignoring: healthcare ministries, setting up my own company to get a company plan, and ACA. Purely interested in private insurance which, as I understand, is only available through Blue Cross Blue Shield of Texas HMO. I’ve searched other posts and found a few pieces of feedback but worried they might be a little out of date. For the purpose of feedback, also ignore my ability to retire early (our investment assets are >> 30x...
by Carbonate24
Tue Sep 03, 2019 9:53 pm
Forum: Investing - Theory, News & General
Topic: Inflation Protected Securities: When to Get in, not How
Replies: 64
Views: 5352

Re: Inflation Protected Securities: When to Get in, not How

This is tremendously helpful feedback to my post, thank you. I’ve now got at least a few evenings worth of studying from the recommended links. I hear the feedback loudly that my brand of trigger concept is plain old market timing; also good info for me to digest on VALUING TIPS. The math major in me loves it. 
rich126 commented on (individual) TIPS being great for people with savings of 40x+ and just trying to preserve their money. That’s exactly where I am. I am almost 50 and have saved like crazy and have ~35x current spending. My wife and I have recently come across FIRE and, with low hanging fruit expense reductions, we think we could easily/quickly get to 40x or more. So we have effectively had an “awakening” that I might retire from ...
by Carbonate24
Mon Sep 02, 2019 9:16 pm
Forum: Investing - Theory, News & General
Topic: Inflation Protected Securities: When to Get in, not How
Replies: 64
Views: 5352

Re: Inflation Protected Securities: When to Get in, not How

Guidance much appreciated - I need to go back and study Swedroe.
by Carbonate24
Mon Sep 02, 2019 4:30 pm
Forum: Investing - Theory, News & General
Topic: Inflation Protected Securities: When to Get in, not How
Replies: 64
Views: 5352

Inflation Protected Securities: When to Get in, not How

I am seeking guidance on inflation protected securities, but my question has a different bent than the various posts I’ve read on TIPS / I-Bonds. Question: What would I see in the “data" that should spur me to initiate/increase a position in inflation protected securities? How much lead time would that data provide? I would like to include a statement in my IPS along the lines of “when I see this:_________, I need to increase my inflation protected securities holdings”….or perhaps a schedule of TIPS holdings like someone might use an “age in bonds” rule. Background: I have been studying posts on TIPS & I-Bonds, and I have found several that do a good job describing the math, pros/cons, taxation, how to buy them, and the like. What ...
by Carbonate24
Wed Aug 21, 2019 9:21 pm
Forum: Personal Investments
Topic: How do bond ratings degrade during recession?
Replies: 9
Views: 801

Re: How do bond ratings degrade during recession?

Comments much appreciated - reassuring to see how the various types rebounded relatively quickly. That's the safety I am looking for in my bond holdings.
by Carbonate24
Tue Aug 20, 2019 7:30 pm
Forum: Personal Investments
Topic: How do bond ratings degrade during recession?
Replies: 9
Views: 801

How do bond ratings degrade during recession?

I've been surfing around posts looking for information on how bond ratings might degrade in a recession, but I haven't quite found what I was looking for. Wondering if anyone has input or can point to resource? Background: I am a bit short of age 50 and I am considering retiring early (before normal retirement date at my corp, reduced pension) and I am taking a hard look at my financial situation. I am currently ~40% bonds, 60% equities. Almost all equities are Vanguard Total Stock Market Domestic / International ETFs.....IPS target 80% domestic. All of my bonds are individual issue with characteristics listed below. I've got a good feel for what might happen to my equities in a severe market correction,....but I have a poorer understanding...
by Carbonate24
Wed Dec 26, 2018 9:19 pm
Forum: Personal Investments
Topic: Foreign Equities : Long-Term Return and Data Sources
Replies: 4
Views: 549

Foreign Equities : Long-Term Return and Data Sources

I am trying to get a better understanding of long term foreign equity returns. I am also trying to identify a quick, cheap and easy source for historical foreign equity data. As I relook at my portfolio, IPS, etc, one thing I keep questioning is my foreign equity percentage. Per my IPS, my current percentage of foreign equities is fairly low. As I read through numerous posts and the various BH surveys, I notice the majority of people have a higher international equity allocation (not that that makes it right for me, of course). 
One thing that’s been holding me back is when I look at foreign equities / developed markets, it seems to me they have had lackluster returns for a long time. I looked at some data for the past 10 or 15 years (forei...
by Carbonate24
Sun Oct 28, 2018 1:22 pm
Forum: Investing - Theory, News & General
Topic: Being true to my IPS, or violating it?
Replies: 22
Views: 2420

Re: Being true to my IPS, or violating it?

I appreciate the feedback. When I first wrote my IPS ~2 years ago, I wasn’t sure how long a waiting period to use, so I just chose 30 days. I see from the responses that some others use much longer waiting periods. I can see the benefit in that and I think I will increase that period to a much larger value. The comment on de-linking AA from my age and rather linking it to size of portfolio is interesting. KlangFool referenced FI being 25 times annual expense, so I guess that’s akin to determining what your base level of cash flow needs are and back calculating the FI need using an interest rate (seems like 4% in this example)? I appreciate the comments about being OK to change IPS for the right reasons, because I do feel like I’ve learned a...
by Carbonate24
Sat Oct 27, 2018 8:16 pm
Forum: Investing - Theory, News & General
Topic: Being true to my IPS, or violating it?
Replies: 22
Views: 2420

Re: Being true to my IPS, or violating it?

I actually did start this thought process quite a bit before the market pull back.

This year, I finally filled up my 401(k) with bonds and our IRAs have been all bonds for quite some time....So earlier this year, I started thinking about how I want to hold bonds outside those tax protected vehicles.....that's what got me thinking about this topic a few months ago.
by Carbonate24
Sat Oct 27, 2018 5:59 pm
Forum: Investing - Theory, News & General
Topic: Being true to my IPS, or violating it?
Replies: 22
Views: 2420

Being true to my IPS, or violating it?

As I put together my first IPS almost 2 years ago, and considered my risk tolerance, I came up with a fixed income allocation of AGE - 15. Being that I am now 47, that pegs my fixed income allocation at 32% and I am pretty close (within my rebalance bands) to that percentage. At the time, I reviewed various posts on risk tolerance (willingness, ability, and need....). I reviewed those posts again recently. Over the past 2 years, I have done quite well financially (better than I thought, even with the market slide this month taken into account) and although I have not yet “won the race”, I am getting close to that point. As I have watched interests rates rise and heard prognosticators do story after story that the long-running US bull market...
by Carbonate24
Sat Mar 17, 2018 12:15 pm
Forum: Personal Investments
Topic: Such a thing an inflation protected MUNI?
Replies: 6
Views: 1018

Such a thing an inflation protected MUNI?

Is there any type of US Based, legitimate investment vehicle that combines the inflation protection of TIPS with the tax sheltering of Munis?
by Carbonate24
Mon Jan 08, 2018 7:02 pm
Forum: Personal Investments
Topic: Rebalance in 401k
Replies: 10
Views: 1316

Re: Rebalance in 401k

You are almost correct HockeyFan99. I have the option to convert some, or all, of my 401(k) to a Roth 401(k), but I have not done so. So within my 401(k), there are two "sub accounts", one is called the pre tax sub-account and one is called post tax sub-account. In 2018, if I put a total of $28,500 into my 401(k), the first $18,500 will go to the pre tax account and the other $10,000 will go to the post tax account. Taxes are deferred on both of those accounts until withdrawal (obviously even further with rollover to IRA). From the information I've read on my plan policy, the main reason these accounts are split this way is that - even though I have not elected to do the Roth feature - I can still pull a portion of these sub-accou...
by Carbonate24
Mon Jan 08, 2018 5:57 pm
Forum: Personal Investments
Topic: Rebalance in 401k
Replies: 10
Views: 1316

Re: Rebalance in 401k

I can change my new allocation percentage and hence gradually adjust over time. I was thinking I would do it all at once because my equities are up substantially and just went outside my rebalance bands.
by Carbonate24
Mon Jan 08, 2018 10:42 am
Forum: Personal Investments
Topic: Rebalance in 401k
Replies: 10
Views: 1316

Re: Rebalance in 401k

So I don’t have a Roth 401k. This is just a traditional 401k where I put beyond the (? Can’t temember exact number) $18,000 per year. The amount up to 18k is kept in one account , and after 18k in another account
by Carbonate24
Mon Jan 08, 2018 9:22 am
Forum: Personal Investments
Topic: Rebalance in 401k
Replies: 10
Views: 1316

Rebalance in 401k

Seeking some advice on how to rebalance in my 401k

I have decided a certain bond/equity allocation and I am ready to rebalance to meet my target allocation

However, I need to decide whether I want to rebalance in my BEFORE TAX account , or in my AFTER TAX account, or both.

In my case , I will be selling equities and buying bonds. I have equities in both my BT and AT portions of my 401k....
by Carbonate24
Wed Oct 11, 2017 4:23 pm
Forum: Personal Investments
Topic: Do I lose NUA if I quit my job?
Replies: 7
Views: 1509

Re: Do I lose NUA if I quit my job?

Thanks to all.... helpful. I will need to check my plan rules. I suspect they might not want to give me the shares of stock if I quit, rather just the cash. It's a bit tricky since the rules are easy to get in Summary Form, but much harder to get in official/legal/long form. Eventually, I probably have to ask HR or plan administrator "will you give me shares if I quit", which has the potential to raise flags.
by Carbonate24
Wed Oct 11, 2017 12:58 pm
Forum: Personal Investments
Topic: Do I lose NUA if I quit my job?
Replies: 7
Views: 1509

Re: Do I lose NUA if I quit my job?

Thanks, very helpful scrabbler1. I didn't anticipate the possibility that the plan design might impact the answer. I assumed only IRS rules would drive the outcome.
by Carbonate24
Wed Oct 11, 2017 12:16 pm
Forum: Personal Investments
Topic: Do I lose NUA if I quit my job?
Replies: 7
Views: 1509

Do I lose NUA if I quit my job?

I’ve been studying posts about the pros/cons of NUA (Net Unrealized Appreciation) in a 401(k), but there is one Q&A topic I have not come across yet, so seeking input for anyone that knows. Background: I have a 401(k) comprised of about 80% index funds and 20% company stock. I am 47 and I plan to retire at about 60, though I am flexible on retirement age as I do have a comfortable amount of non-401(k) assets (IRA, investment accounts) Question: I understand how using NUA would work if I retire from my company. But what if I resign? If I were to resign in 2018, do the tax rules still allow me the flexibility to maintain the NUA benefit? I realize the NUA is not a slam-dunk…..paying ordinary tax on the cost basis immediately vs diversifyi...
by Carbonate24
Fri Aug 11, 2017 9:16 pm
Forum: Investing - Theory, News & General
Topic: Rebalancing with Account Restrictions
Replies: 5
Views: 1141

Re: Rebalancing with Account Restrictions

Thanks all....helpful. Seems as though transaction frequency restrictions I've got + IRA balancing will keep me in check most of time.
by Carbonate24
Wed Aug 09, 2017 9:05 pm
Forum: Investing - Theory, News & General
Topic: Rebalancing with Account Restrictions
Replies: 5
Views: 1141

Rebalancing with Account Restrictions

Almost all of my non-401(k) assets are equities. Almost all of the bonds I own are in my 401k. When it comes time to rebalance equities/bonds per my chosen AA percentage, that will almost always require a 401k transaction. The problem is my 401k only allows 2 transactions per month - no exceptions. Only having recently adopted an IPS, AA, etc, I don't have a good feel for how often rebalancing is done. I suspect there won't often be periods where I need more than 2 rebalances per month. But if my AA did require more than two 401k rebalances in a given month, I don't have a sophisticated approach considering the account restrictions. Thoughts? My plan so for is to rebalance my 401k when my AA tells me to, and just wait until the beginning of...
by Carbonate24
Sat Aug 05, 2017 4:37 pm
Forum: Personal Investments
Topic: Guidance on Asset Allocation Exclusions:
Replies: 1
Views: 470

Guidance on Asset Allocation Exclusions:

I would appreciate input and insights on specific items that I have EXCLUDED from my asset allocation. Quick Background: I’m married, mid-40’s with two teens. I have a good career in a stable job (relatively large company). I plan to retire at 55, but I enjoy my job, so I might work an additional 5 to 10 years. I have worked hard, lived well below my means, saved like crazy, and amassed a pretty good amount of $. I’ve also recently started getting restricted stock (RS)….if I were to continue getting RS (obviously no guarantee) it could be a material add to net worth. My parents were very similar in their saving and moderate spending habits. As such, I will likely get an after tax inheritance that will at least double my net worth. College 5...
by Carbonate24
Wed Aug 02, 2017 3:42 pm
Forum: Personal Investments
Topic: Handling Restricted Stock in Rebalancing
Replies: 12
Views: 1389

Re: Handling Restricted Stock in Rebalancing

Very helpful insights and input on how others are actually handling this. I had not considered the approach to discount/haircut the value.....I'll think more about that.
by Carbonate24
Tue Aug 01, 2017 10:21 pm
Forum: Personal Investments
Topic: Handling Restricted Stock in Rebalancing
Replies: 12
Views: 1389

Handling Restricted Stock in Rebalancing

I've been fortunate to recently receive some restricted stock (RS) from my employer. It's restricted until the mid-2020's. This is the first year I gotten these, so I had not anticipated this in my investment plans. For the purpose of rebalancing, should I include RS in the math, and if so, at what value? Background: I've landed on an AGE - 15 based rule for fixed income percentage (current age ~ 45, therefore fixed income ~ 30% of total assets). To date, I have excluded the RS from my rebalancing....in other words I ignore it when applying my 70% equities/30% bonds allocation to the rest of my assets. If I included the RS, I would need to sell some equities and buy bonds (obviously I can't sell the RS today, so I'd have to sell some non-RS...
by Carbonate24
Fri Jul 07, 2017 6:58 pm
Forum: Personal Investments
Topic: Clarification: Rebalancing considering Duration
Replies: 18
Views: 1987

Re: Clarification: Rebalancing considering Duration

As aristotelian mentioned above, I was referring to average duration of a bond fund. In my OP, I was trying to reconcile what I read on the Individual Bond vs Bond Fund Wiki "..... you should always hold bond funds with a duration equal to or shorter than the expected need for your money ...." with the fact that I might need to hold a bond fund for less time due to my rebalancing bands kicking in. But based on the feedback here, I see the flaw in my thinking. I should have been focused on the fact that I do NOT need the money in the short-term.....my need for the money is much further away than the duration in years. So I just need to associate duration with the volatility, similar to how I know that my equities will also have vol...
by Carbonate24
Thu Jul 06, 2017 6:42 pm
Forum: Personal Investments
Topic: Clarification: Rebalancing considering Duration
Replies: 18
Views: 1987

Re: Clarification: Rebalancing considering Duration

Thanks dbr. I don't think I have a special case.
by Carbonate24
Thu Jul 06, 2017 5:40 pm
Forum: Personal Investments
Topic: Clarification: Rebalancing considering Duration
Replies: 18
Views: 1987

Re: Clarification: Rebalancing considering Duration

I guess I placed too much weight on the importance of duration….perhaps a better way for me to think of it is:


When considering a bond mutual fund purchase, compare the fund's duration versus my investment horizon…..but duration shouldn't be a consideration that prevents me from adhering to my asset allocation.
by Carbonate24
Thu Jul 06, 2017 5:41 am
Forum: Personal Investments
Topic: Clarification: Rebalancing considering Duration
Replies: 18
Views: 1987

Re: Clarification: Rebalancing considering Duration

I don't think anything "magical" would happen on the day my fund hits duration.......just thinking back to the adage to consider investment horizon and bond fund duration.....but I get the point, Asset Allocation is key.
by Carbonate24
Wed Jul 05, 2017 9:35 pm
Forum: Personal Investments
Topic: Clarification: Rebalancing considering Duration
Replies: 18
Views: 1987

Clarification: Rebalancing considering Duration

Seeking clarification on rebalancing using a hypothetical: 
Suppose the following 4 criteria: (1) Due to market gyrations and my chosen rebalance bands, my investment policy directs me to reduce my fixed income % and increase my equity %. (2) The only way I can achieve the rebalancing is to sell fixed income and purchase equity (e.g. I have no cash on the side, no meaningful new inflows of money, no tax loss harvesting opportunities….). (3) The length of time that I’ve owned some (or all) of the fixed income mutual fund is LESS than the duration of the fund. (4) Interest rates are going up (hence rates for my IT Bond MF are also going up). Then, it seems to me that my rebalance bands have put me in a situation where I am forced to sell befo...
by Carbonate24
Mon Jun 26, 2017 11:32 pm
Forum: Personal Investments
Topic: Critique first IPS and Planned Transactions
Replies: 4
Views: 847

Re: Critique first IPS and Planned Transactions

Thanks for the input Watty. I’ve got plans for mortgage, car and college but didn’t explicitly mention them - worth adding for completeness (cars are minor cost since I buy decent but old, used cars and keep them for many years). I do need to study options for Social Security more - good upgrade.