Search found 3863 matches

by David Jay
Mon Oct 23, 2017 10:24 pm
Forum: Investing - Theory, News & General
Topic: Building very high net worth
Replies: 42
Views: 3472

Re: Building very high net worth

This is an observation in "The Millionaire Next Door". That person is most commonly a small business owner. No. The OP was talking about a NW of $12M+. I believe the research criteria as defined and used in "The Millionaire Next Door" was those with a NW of $1-5M. To what are you responding? Are yo...
by David Jay
Mon Oct 23, 2017 10:14 pm
Forum: Investing - Help with Personal Investments
Topic: Help with parent’s portfolio
Replies: 21
Views: 806

Re: Help with parent’s portfolio

Of course when you look at the paperwork and see she bought into an S&P 500 indexed annuity 5 years ago for $200,000–and today its face value is $205,000—you can see how these companies make their money. I'm bookmarking this one! S&P total return in the last 5 years is about 80%. Also noteworthy is...
by David Jay
Mon Oct 23, 2017 10:06 pm
Forum: Investing - Theory, News & General
Topic: What does a bond crash look like?
Replies: 19
Views: 1002

Re: What does a bond crash look like?

Duplicate post
by David Jay
Mon Oct 23, 2017 9:59 pm
Forum: Investing - Theory, News & General
Topic: What does a bond crash look like?
Replies: 19
Views: 1002

Re: What does a bond crash look like?

As I near retirement, I've moved to 50% bonds. But keep wondering if I should sell bond funds and buy cd's for the years before SS. A short-term bond fund will return to equivalent value (lower price but higher yield) within a year or so. Intermediate like Total Bond in 5 or 6 years. I have 8 years...
by David Jay
Mon Oct 23, 2017 9:48 pm
Forum: Investing - Help with Personal Investments
Topic: Help with parent’s portfolio
Replies: 21
Views: 806

Re: Help with parent’s portfolio

Of course when you look at the paperwork and see she bought into an S&P 500 indexed annuity 5 years ago for $200,000–and today its face value is $205,000—you can see how these companies make their money. I'm bookmarking this one! S&P total return in the last 5 years is about 80%. Also noteworthy is...
by David Jay
Mon Oct 23, 2017 8:59 pm
Forum: Investing - Help with Personal Investments
Topic: Help with parent’s portfolio
Replies: 21
Views: 806

Re: Help with parent’s portfolio

Jags4186 wrote:
Mon Oct 23, 2017 11:38 am
Of course when you look at the paperwork and see she bought into an S&P 500 indexed annuity 5 years ago for $200,000–and today its face value is $205,000—you can see how these companies make their money.
I'm bookmarking this one! S&P total return in the last 5 years is about 80%.
by David Jay
Mon Oct 23, 2017 8:38 pm
Forum: Investing - Theory, News & General
Topic: What does a bond crash look like?
Replies: 19
Views: 1002

Re: What does a bond crash look like?

As I near retirement, I've moved to 50% bonds. But keep wondering if I should sell bond funds and buy cd's for the years before SS. A short-term bond fund will return to equivalent value (lower price but higher yield) within a year or so. Intermediate like Total Bond in 5 or 6 years. I have 8 years...
by David Jay
Mon Oct 23, 2017 3:49 pm
Forum: Investing - Theory, News & General
Topic: Building very high net worth
Replies: 42
Views: 3472

Re: Building very high net worth

This is an observation in "The Millionaire Next Door".

That person is most commonly a small business owner.
by David Jay
Mon Oct 23, 2017 3:19 pm
Forum: Investing - Theory, News & General
Topic: 1956 Birthdate - First possible SS PIA over $3000
Replies: 2
Views: 520

Re: 1956 Birthdate - First possible SS PIA over $3000

According to my calculation spreadsheet, the maximum PIA for someone who has met-or-exceeded the SS withholding maximum for 35 straight years and was born in 1956 is $3004 per month (for those born in 1955, the maximum was $2941 per my spreadsheet). If it isn't too hard to tweak your spreadsheet it...
by David Jay
Mon Oct 23, 2017 1:47 pm
Forum: Investing - Theory, News & General
Topic: 1956 Birthdate - First possible SS PIA over $3000
Replies: 2
Views: 520

1956 Birthdate - First possible SS PIA over $3000

According to my calculation spreadsheet, the maximum PIA for someone who has met-or-exceeded the SS withholding maximum for 35 straight years and was born in 1956 is $3004 per month (for those born in 1955, the maximum was $2941 per my spreadsheet). An individual's AWI indexing value is fixed at age...
by David Jay
Mon Oct 23, 2017 11:32 am
Forum: Investing - Help with Personal Investments
Topic: Help with parent’s portfolio
Replies: 21
Views: 806

Re: Help with parent’s portfolio

When did she begin collecting Social Security? If it as within the last year or so, she should consider suspending (and paying back the past SS out of savings), then re-file @ 70. 32% increase SS @ 70 versus 66. So $2300/mo becomes more like $3200/mo (Medicare costs don't go up). $11000 per year (9...
by David Jay
Sun Oct 22, 2017 9:56 pm
Forum: Investing - Help with Personal Investments
Topic: question about expense ratio, returns, and fund of funds
Replies: 7
Views: 335

Re: question about expense ratio, returns, and fund of funds

I've not seen a case where the ER shown was anything but NET inclusive of all fees (in answer to both questions).
by David Jay
Sun Oct 22, 2017 9:47 pm
Forum: Investing - Help with Personal Investments
Topic: Timing the Bond Market/Interet Rates
Replies: 7
Views: 571

Re: Timing the Bond Market/Interet Rates

With the almost near certainty of the Federal Reserve raising interest rates again in December, is it better to wait until after the announcement to add to my bond allocation...? As a perceptive person asked me when I wanted to wait until after a Fed meeting to buy Total Bond (about 18 months ago):...
by David Jay
Sun Oct 22, 2017 4:44 pm
Forum: Investing - Theory, News & General
Topic: Mutual Fund "share price"
Replies: 22
Views: 888

Re: Mutual Fund "share price"

It's the difference of buying by units versus buying by volume. The confusion is that the newbie thinks that they are buying units (3 television sets) when they are purchasing by volume (a gallon). I don't know how to get them past it, I often use the "4 quarts at a dollar each is the same as a gall...
by David Jay
Sat Oct 21, 2017 9:36 pm
Forum: Investing - Help with Personal Investments
Topic: Transfer of assets from Edward Jones to Vanguard
Replies: 7
Views: 428

Re: Transfer of assets from Edward Jones to Vanguard

student wrote:
Sat Oct 21, 2017 9:23 pm
SoSuzanne wrote:
Sat Oct 21, 2017 9:08 pm
Yes, IRA and Roth IRA.

Thank you!
There are no tax consequences here. Sell all and transfer the cash to Vanguard.
^^^ This!
by David Jay
Sat Oct 21, 2017 8:11 pm
Forum: Personal Finance (Not Investing)
Topic: Can I retire early?
Replies: 9
Views: 2358

Re: Can I retire early?

Welcome to the forum. Is it do-able? That is a question with a bunch of unknowns. It all comes down to expenses in retirement. You have to pay your expenses. So narrowing down that number is your first goal. You can use today's dollars for now, inflation is unknowable this far out. For early retirem...
by David Jay
Sat Oct 21, 2017 10:58 am
Forum: Investing - Help with Personal Investments
Topic: Commission only fiduciary planner
Replies: 95
Views: 2846

Re: Commission only fiduciary planner

ruralavalon wrote:
Sat Oct 21, 2017 9:13 am
I personally cannot imagine how a commission based fee arrangement can be free of a conflict of interest.
^^^ This
by David Jay
Sat Oct 21, 2017 9:26 am
Forum: Personal Finance (Not Investing)
Topic: Better than 4% Rule
Replies: 31
Views: 3285

Re: Better than 4% Rule

Thank you. This is helpful. So, basically, trying to follow their advice on how to improve on the 4% rule would basically be exceedingly difficult for the average investor? They said you can improve on the 4% rule by using dynamic withdrawals. That is something that is easy for the average investor...
by David Jay
Sat Oct 21, 2017 9:17 am
Forum: Personal Finance (Not Investing)
Topic: Better than 4% Rule
Replies: 31
Views: 3285

Re: Better than 4% Rule

Knighted: Since you say you have some time left, the 4% study (equivalent to 25x expenses in LMP) is a good rule of thumb (I would only treat 4% as a rule-of-thumb because it is not truly 100% for all historic retirement periods) and a very useful way to evaluate if you have enough to retire. Also r...
by David Jay
Fri Oct 20, 2017 10:17 pm
Forum: Investing - Help with Personal Investments
Topic: Advice on Advisor's choice of immediate variable annuity for retirement income
Replies: 22
Views: 1211

Re: Advice on Advisor's choice of immediate variable annuity for retirement income

I posted this earlier today, I wrote about IRA accounts but the same is true for 401K accounts because they are also tax-deferred: viewtopic.php?f=1&t=230189#p3581258
by David Jay
Fri Oct 20, 2017 3:41 pm
Forum: Investing - Help with Personal Investments
Topic: Transferring Variable Annuity
Replies: 9
Views: 685

Re: Transferring Variable Annuity

The OP has figured this out, but for others who may be reading this thread: Variable Annuities inside an IRA are essentially financial malpractice. VAs are "wrappers", with mutual funds inside. The insurance company typically charges you 2% - 3% (fees plus ER) for the privilege of holding your money...
by David Jay
Fri Oct 20, 2017 12:02 pm
Forum: Investing - Help with Personal Investments
Topic: Transferring Variable Annuity
Replies: 9
Views: 685

Re: Transferring Variable Annuity

Cyclesafe wrote:
Fri Oct 20, 2017 10:20 am
Please do not cash out at NWM. That would be a taxable event for your earnings.
Perhaps you missed that both of these annuities are held within IRAs (one Roth, one Traditional). As long as the assets remain inside the IRA there is no taxable event.
by David Jay
Fri Oct 20, 2017 10:18 am
Forum: Personal Finance (Not Investing)
Topic: Whole Life Insurance
Replies: 36
Views: 1609

Re: Whole Life Insurance

Yes, I also feel like it's too good to be true. That's why I came here to try and find the catch. That is why you need to read the actual policy (to understand cash value, etc.) and an in-force illustration . Don't believe anything that includes the words "estimated" or "projected". And double-don'...
by David Jay
Thu Oct 19, 2017 10:02 pm
Forum: Investing - Theory, News & General
Topic: For those near retirement and rebalanced to Bonds...
Replies: 34
Views: 3400

Re: For those near retirement and rebalanced to Bonds...

I am about a year from retirement. I have a very high tolerance for volatility (I don't freak out when stocks go on sale) and I was 100% stocks through 2000 and 2009. I have moved all of my living expenses for the period from age 62 to age 70 to bonds. In this way the market can't prevent me from re...
by David Jay
Thu Oct 19, 2017 12:15 pm
Forum: Personal Finance (Not Investing)
Topic: Whole Life Insurance
Replies: 36
Views: 1609

Re: Whole Life Insurance

I want to take you back to the basics: What is the reason why your parents are holding this policy? If they intend to hold the policy until death, then the cash value is meaningless. At death the policy pays the benefit amount and the cash value is lost. If they holding this as an investment that t...
by David Jay
Thu Oct 19, 2017 11:58 am
Forum: Personal Finance (Not Investing)
Topic: Whole Life Insurance
Replies: 36
Views: 1609

Re: Whole Life Insurance

Raabe34 wrote:
Thu Oct 19, 2017 11:42 am
Ask for an in-force illustration currently and then with the projection.
Important language! An in-force illustration is what the insurance company guarantees. Every other number is just so many words. Even if it is in writing.
by David Jay
Thu Oct 19, 2017 11:55 am
Forum: Personal Finance (Not Investing)
Topic: Whole Life Insurance
Replies: 36
Views: 1609

Re: Whole Life Insurance

I want to take you back to the basics: What is the reason why your parents are holding this policy? If they intend to hold the policy until death, then the cash value is meaningless. At death the policy pays the benefit amount and the cash value is lost. If they holding this as an investment that th...
by David Jay
Wed Oct 18, 2017 5:15 pm
Forum: Investing - Theory, News & General
Topic: Larry Swedroe:Better To Face The Correction
Replies: 51
Views: 6370

Re: Larry Swedroe:Better To Face The Correction

Excellent article by Larry. He shows that it is more wise to stay in the market than to try to time a correction when equities seem over valued or generously valued. This is probably the least news-worthy thing to post in this particular forum. :D I don't know - I have been involved in 3 "going to ...
by David Jay
Tue Oct 17, 2017 6:52 pm
Forum: Investing - Help with Personal Investments
Topic: Transferring IRA account from Etrade to Credit Union
Replies: 5
Views: 320

Re: Transferring IRA account from Etrade to Credit Union

Welcome to the forum.

Why would you even WANT to transfer an IRA to a Credit Union? What does a Credit Union offer you that would make you think about doing this?

The process is very straightforward, you work with the destination institution. Because they want your business...

But again, WHY?
by David Jay
Tue Oct 17, 2017 5:35 pm
Forum: Personal Finance (Not Investing)
Topic: Help picking apart whole life insurance cash value
Replies: 39
Views: 1591

Re: Help picking apart whole life insurance cash value

At year 10 end, the IRR for converting the cash value portion of premiums to guaranteed cash value is 3.33 %. As a 40 year old, you have no memory of inflationary times so it is easy to assume that the low interest rate environment of the last 20 years will go on forever. My first home purchase was...
by David Jay
Mon Oct 16, 2017 6:25 pm
Forum: Investing - Theory, News & General
Topic: Roth as good as you think?
Replies: 29
Views: 3502

Re: Roth as good as you think?

I doubt many 25 or 30 year olds can predict what their future tax bracket will be when they retire at ,say, 65. True, but some people have a hint: 1. If your are in the 39% tax bracket, go with tax deferred. 2. If you are making 8 bucks an hour (like my youngest), do a Roth. (Oh, and take the saver...
by David Jay
Mon Oct 16, 2017 5:16 pm
Forum: Investing - Theory, News & General
Topic: Roth as good as you think?
Replies: 29
Views: 3502

Re: Roth as good as you think?

The Wiki does the same calculation (and confirms your result) here: https://www.bogleheads.org/wiki/Traditional_versus_Roth So it really does come down to tax bracket at contribution versus tax bracket at withdrawal. The issue that is sometimes over-looked is that RMDs can easily push retirees into ...
by David Jay
Mon Oct 16, 2017 2:16 pm
Forum: Personal Finance (Not Investing)
Topic: couple of questions regarding inflation and the 4% rule
Replies: 19
Views: 2012

Re: couple of questions regarding inflation and the 4% rule

I understand the "4% rule" as something along the lines of...you can withdraw 4% of your portfolio value in year 1 of retirement, increase withdrawal each year based on inflation, and you have a high (95%-ish) chance of success over a period of 30 years. I'm aware that 3.5% may be the new 4% and th...
by David Jay
Mon Oct 16, 2017 2:03 pm
Forum: Investing - Help with Personal Investments
Topic: Making a Roth IRA for my Dad
Replies: 31
Views: 1376

Re: Making a Roth IRA for my Dad

Does he have a 401K or other deferred savings plan at work? If so, he can dump $18,000 a year into that (and replace those living expenses with taxable funds) for the next couple of years. That's the fastest way to build up his tax-advantaged space. He can roll that money over into a Roth later if i...
by David Jay
Mon Oct 16, 2017 1:45 pm
Forum: Personal Finance (Not Investing)
Topic: Social Security payouts vs. "estimated benefits" online
Replies: 36
Views: 1934

Re: Social Security payouts vs. "estimated benefits" online

As someone else referenced once you have earnings past the 2nd bend point ($2.25M Index earnings) the differences for future earnings will have limited impact to your benefits. $100K indexed earnings = $35.70/mo in FRA benefits past the 2nd bend point. (Earnings /420 * 15%) And even that assumes yo...
by David Jay
Mon Oct 16, 2017 12:38 pm
Forum: Personal Finance (Not Investing)
Topic: Social Security payouts vs. "estimated benefits" online
Replies: 36
Views: 1934

Re: Social Security payouts vs. "estimated benefits" online

Up through age 60, but with a two-year delay because of how long it takes to gather accurate wage data, one's future benefit is adjusted for the wage index. Starting from age 62 benefits are adjusted per CPI-W. Am I correct that this creates a window of vulnerability for early retirees? If there is...
by David Jay
Sun Oct 15, 2017 9:41 pm
Forum: Personal Finance (Not Investing)
Topic: Social Security payouts vs. "estimated benefits" online
Replies: 36
Views: 1934

Re: Social Security payouts vs. "estimated benefits" online

Yes, if you have 35 years at max contribution, you should receive in excess of $3000 a month at Full Retirement Age (FRA).

Increases for inflation are based on a wage index, not on cost of living per say. But if wages go up 2% per year, your projections are reasonable.
by David Jay
Sat Oct 14, 2017 7:37 pm
Forum: Investing - Help with Personal Investments
Topic: ETF index funds for hesitant Retiree
Replies: 7
Views: 623

Re: ETF index funds for hesitant Retiree

delamer wrote:
Sat Oct 14, 2017 5:39 pm
You might show her this, and see where her comfort level is:

https://personal.vanguard.com/us/insigh ... llocations
^^^ This!
by David Jay
Sat Oct 14, 2017 1:06 pm
Forum: Investing - Help with Personal Investments
Topic: ETF index funds for hesitant Retiree
Replies: 7
Views: 623

Re: ETF index funds for hesitant Retiree

The key questions are: What is her need, ability and willingness to take risk. It is hard to comment intelligently without knowing her expenses and the size of the portfolio. If she has $3M and only needs $75,000 a year for living expenses then she has no need to take any risk. If she has $1M and ne...
by David Jay
Sat Oct 14, 2017 8:44 am
Forum: Investing - Help with Personal Investments
Topic: inservice rollover to IRA?
Replies: 7
Views: 397

Re: inservice rollover to IRA?

If you are over 59.5 and live in Florida then there is no big advantage to keeping the funds in the employer accounts. I would look at fund choices and ERs at the margin (I did a rollover of my 401k within a week of turning 59.5 but I had poor fund choices in my small company 401K), but in the end i...
by David Jay
Sat Oct 14, 2017 8:32 am
Forum: Investing - Help with Personal Investments
Topic: Investing in private companies
Replies: 31
Views: 1914

Re: Investing in private companies

With regard to the comment below about not buying at least a 51% stake, this is likely going to be impossible for you. The investors who acquire such a stake are going to be the sophisticated institutional players who will also demand (and obtain) board presence as a condition of their investment. ...
by David Jay
Sat Oct 14, 2017 8:00 am
Forum: Investing - Help with Personal Investments
Topic: My EJ portfolio vs my Vanguard, side by side
Replies: 27
Views: 3145

Re: My EJ portfolio vs my Vanguard, side by side

I'm curious about the taxes. I suspect you didn't withdraw from either portfolio the money needed to pay the taxes on the annual distributions. Your tax returns, especially Schedule B should be enlightening. In some respects, if EJ caused you $10,000 extra annually in taxes over Vanguard, then it w...
by David Jay
Fri Oct 13, 2017 7:00 pm
Forum: Personal Finance (Not Investing)
Topic: Roth conversions...did I miss the boat?
Replies: 8
Views: 1674

Re: Roth conversions...did I miss the boat?

If you had sizable pre-tax dollars in a Traditional IRA what would be your Roth conversion strategy today (if any)? It all comes down to taxes: 1. Your current marginal tax rate 2. Marginal tax rate between retirement and start of Social Security 3. Marginal tax rate after start of SS and before st...
by David Jay
Fri Oct 13, 2017 5:02 pm
Forum: Investing - Help with Personal Investments
Topic: Investing in private companies
Replies: 31
Views: 1914

Re: Investing in private companies

First, never purchase less than 51% of a privately held company. You have virtually no control or liquidity as a minority owner. Pooling resources in a partnership in order to purchase control of a small company may work out. Be certain that everything is spelled out clearly in the partnership docum...
by David Jay
Fri Oct 13, 2017 3:45 pm
Forum: Investing - Help with Personal Investments
Topic: My EJ portfolio vs my Vanguard, side by side
Replies: 27
Views: 3145

Re: My EJ portfolio vs my Vanguard, side by side

First guess - underperformance by International in recent years. At 40% of stocks (32% of portfolio) the VG account appears to have about 12-13% more international than EJ.
by David Jay
Fri Oct 13, 2017 2:37 pm
Forum: Investing - Help with Personal Investments
Topic: Need help with current market (voo,vti)
Replies: 48
Views: 2027

Re: Need help with current market (voo,vti)

Markets are at-or-near all time highs about 60% of the time. So by definition it is completely normal for broad market funds to be "really high and about as high as they have ever been". True, I just dont want to risk buying high and then later it dips real low in price , so I was thinking bonds an...
by David Jay
Fri Oct 13, 2017 10:43 am
Forum: Personal Finance (Not Investing)
Topic: 2018 SS COLA contest
Replies: 7
Views: 791

Re: 2018 SS COLA contest

TLC wrote:
Fri Oct 13, 2017 8:30 am
David Jay wrote:
Thu Oct 12, 2017 9:21 pm
Do you know if 2016 AWI comes out at the same time? It has been issued in October in recent years
The AWI for 2016 was reported today to be 48,664.73.
source: https://www.ssa.gov/oact/cola/awiseries.html
Thanks, I saw your other post will all the numbers...
by David Jay
Fri Oct 13, 2017 8:35 am
Forum: Investing - Help with Personal Investments
Topic: Diversify IRAS?
Replies: 3
Views: 161

Re: Diversify IRAS?

To clarify, concentration is not wrong. I have a (small) concentration in Small Company Value. But I understand that by overweighting (also called "tilting" around here) that I am making an informed "bet" on the SCV proposition. The most important thing about overweighting is to believe enough in yo...
by David Jay
Fri Oct 13, 2017 8:23 am
Forum: Investing - Help with Personal Investments
Topic: Diversify IRAS?
Replies: 3
Views: 161

Re: Diversify IRAS?

The TR2060 fund is fully diversified. It holds US stocks, International stocks, US bonds and International bonds. You are free to overweight some sector that you feel will provide better (or less correlated) performance in the future, but understand that what you will be doing is the opposite of div...
by David Jay
Thu Oct 12, 2017 10:38 pm
Forum: Investing - Help with Personal Investments
Topic: Advice on Retirement Investments: IRA? High-Expense Govt 457b?
Replies: 12
Views: 737

Re: Advice on Retirement Investments: IRA? High-Expense Govt 457b?

Thanks. Would it be smarter to open a standard IRA and fund it instead of the Roth? (The logic being that my federal tax bracket might be lower when I retire, so I should take advantage of a tax savings now?) I honestly think I'm likely to remain in the 25% bracket (assuming brackets remain as they...