Search found 243 matches

by Kelly
Sun Oct 15, 2017 2:06 pm
Forum: Investing - Theory, News & General
Topic: Basic portfolio math question
Replies: 6
Views: 575

Re: Basic portfolio math question

Hard to tell with the hypothetical 2 scenarios, but I would approach it differently, and calculate based on expected expenses over the next 10 years, what rate of return you need to not deplete your assets over the next 10 years. Then, at the 10 year mark, do the same but factor in your tax-free li...
by Kelly
Sun Oct 15, 2017 9:20 am
Forum: Investing - Theory, News & General
Topic: Basic portfolio math question
Replies: 6
Views: 575

Basic portfolio math question

Here's the scenario: there are two time periods: ten years and beyond ten years to life expectancy. A large tax free income stream will begin in ten years. Expenses for the next ten years are to be kept in a 60/40 portfolio which amounts to 1/3 of the total assets. No bond portion is needed after te...
by Kelly
Sun Sep 10, 2017 6:40 am
Forum: Investing - Theory, News & General
Topic: Looking for Vanguard's 2009 Econ Outlook
Replies: 0
Views: 292

Looking for Vanguard's 2009 Econ Outlook

Folks

I'm trying to find Vanguard's 2009 Economic Outlook and market expectations. The earliest I can find in google is 2010. Can anyone provide a link?

2007 would also be useful.

Thank you

Kelly
by Kelly
Tue Aug 29, 2017 8:57 am
Forum: Investing - Theory, News & General
Topic: Can't reconcile dividend taxation problem
Replies: 3
Views: 897

Re: Can't reconcile dividend taxation problem

Numbercruncher,

You certainly live up to your name! Thank you. I was chasing my tail on this one for some time. Probably took you 2 mins. I owe you a beer next time I'm in NYC.

Kelly :sharebeer
by Kelly
Mon Aug 28, 2017 8:41 am
Forum: Investing - Theory, News & General
Topic: Can't reconcile dividend taxation problem
Replies: 3
Views: 897

Re: Can't reconcile dividend taxation problem

Sorry, forgot to mention 15% dividend tax rate.
by Kelly
Mon Aug 28, 2017 8:38 am
Forum: Investing - Theory, News & General
Topic: Can't reconcile dividend taxation problem
Replies: 3
Views: 897

Can't reconcile dividend taxation problem

Hi all I'm trying to reconcile two computations concerning the difference in ending balance of two investments. Each returns only a 2% dividend yield that is taxed either annually (investment A) or all once at the end of 3 compound periods (investment B). I'm trying to measure the loss of growth on ...
by Kelly
Fri Jul 28, 2017 12:18 pm
Forum: Investing - Theory, News & General
Topic: Asset location question
Replies: 5
Views: 742

Re: Asset location question

In any case, another way to rebalance out of stocks in taxable without paying cap gains tax is to donate long term shares.
This is valuable advice and will be part of the plan.

Kelly
by Kelly
Fri Jul 28, 2017 10:15 am
Forum: Investing - Theory, News & General
Topic: Asset location question
Replies: 5
Views: 742

Re: Asset location question

Thanks very much for the replies!

Assuming I'm reading this correctly, Morningstar shows that Vanguard's Int'l Value (VTRIX) has a lower tax cost ratio than EFV. Both cost the same at 0.4%. Never understood why Vanguard doesn't make an international value index.


Kelly
by Kelly
Thu Jul 27, 2017 5:42 am
Forum: Investing - Theory, News & General
Topic: Asset location question
Replies: 5
Views: 742

Asset location question

Hi all, Here's my situation: The taxable account is now $1M after a home sale. The IRA $500,000 The desired portfolio is 50/05 as follows (all Vgd). 15% SP 500 15% Mid cap value 10% Tot Int'l 10% Int'l value 50% Bond Tax bracket is 25%. At current rates the before tax yield on the bond index is 2.5%...
by Kelly
Sat Apr 08, 2017 11:29 am
Forum: Investing - Theory, News & General
Topic: Where to go for free or low cost advice?
Replies: 23
Views: 2353

Re: Where to go for free or low cost advice?

The big three no-load mutual fund companies offer this: Vanguard, Fidelity, and T. Rowe Price. This is good but I've seen cases where Fidelity tries to upsell someone into a managed account with 1% annual fee. Some thing happens with Schwab. They appear to use their ETFs as bait. Folks I know who'v...
by Kelly
Sat Apr 08, 2017 6:38 am
Forum: Investing - Theory, News & General
Topic: Where to go for free or low cost advice?
Replies: 23
Views: 2353

Where to go for free or low cost advice?

I'm giving a presentation on investing and I'm putting together a list of places to get investment help without cost. Can you add to this list? Keep in mind that the audience is not Bogleheads. Like most folks, they aren't aware of the inverse relationship between cost and performance. Nor are they ...
by Kelly
Thu Jan 26, 2017 10:35 am
Forum: Investing - Theory, News & General
Topic: REIT index composition index question
Replies: 2
Views: 583

REIT index composition index question

Does anyone know what the differences are between the Dow Jones US Real Estate Index (iShare IYR) and MSCI US REIT Index (Vanguard VGSLX). Looking at historical returns in M* I see a large differences. I would think that two indexes tracking the same sectors would be close after cost. In 2014 VGSLX ...
by Kelly
Tue Jan 10, 2017 5:54 pm
Forum: Investing - Theory, News & General
Topic: Should I get out of TIAA traditional annuity?
Replies: 15
Views: 1453

Re: Should I get out of TIAA traditional annuity?

Thanks all. I was thinking the TIAA option was better than the tilt. I just needed some confirmation.

Many thanks!

Kelly
by Kelly
Tue Jan 10, 2017 4:32 pm
Forum: Investing - Theory, News & General
Topic: Should I get out of TIAA traditional annuity?
Replies: 15
Views: 1453

Re: Should I get out of TIAA traditional annuity?

But you also haven't really shown us what the constraints are that are forcing you to make this choice between Traditional or Small Value. For example, why haven't you been contributing to a traditional or Roth IRA or doing a backdoor Roth every year, and using it for Small Value? Yes, there is a R...
by Kelly
Tue Jan 10, 2017 3:33 pm
Forum: Investing - Theory, News & General
Topic: Should I get out of TIAA traditional annuity?
Replies: 15
Views: 1453

Re: Should I get out of TIAA traditional annuity?

I'm aware of the vintages and this would be an initial investment in that account. There is currently no money in that TIAA traditional so no old vintages to give up. I would not be trading fixed income for equities but would establish the 20% bond position in the total bond market index. The TIAA a...
by Kelly
Tue Jan 10, 2017 2:33 pm
Forum: Investing - Theory, News & General
Topic: Should I get out of TIAA traditional annuity?
Replies: 15
Views: 1453

Should I get out of TIAA traditional annuity?

Folks I have access to a TIAA Traditional Annuity Supplemental Retirement Account which has a fixed 3.25% interest rate (3% guaranteed + declared additional amounts). This appears to be favorable to the Total Bond Market Index with a 2.5% yield and 6 year duration. If I understand duration, if rates...
by Kelly
Fri Jan 06, 2017 11:17 am
Forum: Investing - Theory, News & General
Topic: When is a 401k too expensive to contribute to?
Replies: 2
Views: 474

When is a 401k too expensive to contribute to?

Folks I made a spreadsheet to determine when I 401k is so expensive that it should be avoided if there is no matching. I came across some older threads with links to spreadsheets that others have made (Simba being one). Can anyone point to a link with an excel sheet that does this. I'd like to compa...
by Kelly
Mon Nov 21, 2016 9:29 am
Forum: Investing - Theory, News & General
Topic: Will Vanguard give basic advice?
Replies: 6
Views: 909

Will Vanguard give basic advice?

Folks I'm an independent fee-only (no sales) CFP. I get a lot of calls from brokerage "refugees". I always help them set up an account at Vanguard and create the portfolio. I might charge 1.5 hrs for this. I take asset location (what to put in IRA, Roth taxable, etc) into account as well a...
by Kelly
Sun Nov 13, 2016 3:21 pm
Forum: Investing - Theory, News & General
Topic: Non publicly traded REIT buyback offer
Replies: 14
Views: 1683

Non publicly traded REIT buyback offer

I relative is asking whether she should take Inventrust up on their offer to buyback shares of their non publicly traded REIT. She bought them after crossing paths with a broker at Lincoln Financial. The statement shows a share price of $4. I've read that starting in 2016 they had to report the &quo...
by Kelly
Fri Sep 02, 2016 4:48 am
Forum: Investing - Theory, News & General
Topic: Vgd Retirement Savings Trust vs Total Bond Mkt
Replies: 6
Views: 1107

Re: Vgd Retirement Savings Trust vs Total Bond Mkt

Many thanks to you both. The Vanguard paper did an excellent job explaining the details of the fund. Now I'm wondering how much to put into the stable value fund and total bond market. As a start, I see that within the Gov't TSP Lifecycle fund,the bond component is about 20% total bond market and 80...
by Kelly
Wed Aug 31, 2016 3:16 pm
Forum: Investing - Theory, News & General
Topic: Vgd Retirement Savings Trust vs Total Bond Mkt
Replies: 6
Views: 1107

Vgd Retirement Savings Trust vs Total Bond Mkt

The retirement savings trust is offered in my plan along with the total bond market index. According to the Retirement Savings Trust fact sheet: "The fund invests primarily in synthetic investment contracts backed by high-credit-quality fixed income investments issued by insurance companies and...
by Kelly
Sun Aug 21, 2016 12:47 pm
Forum: Investing - Theory, News & General
Topic: Should I get out of Vgd Total Int'l Bond Fund?
Replies: 11
Views: 1877

Re: Should I get out of Vgd Total Int'l Bond Fund?

Thanks Taylor! Reading Bernstein always helps. This is particularly useful info from the good Dr: when you take foreign sovereign bonds and hedge them back to the dollar—you’ve basically got U.S. bonds.
by Kelly
Sun Aug 21, 2016 11:26 am
Forum: Investing - Theory, News & General
Topic: Should I get out of Vgd Total Int'l Bond Fund?
Replies: 11
Views: 1877

Re: Should I get out of Vgd Total Int'l Bond Fund?

Even with low rates, there are a few ways you can make a return greater than the 0.4% yield. Two examples are fluctuations between exchange rates, and further cuts to the interest rate. They use currency hedging. If rates are cut, I'd still get a 0.4% annualized return by the 7.8 year duration unle...
by Kelly
Sun Aug 21, 2016 10:39 am
Forum: Investing - Theory, News & General
Topic: Question about bond fund duration and current SEC yield
Replies: 2
Views: 384

Question about bond fund duration and current SEC yield

Folks I asked this question earlier in another form and I think it was misunderstood. Or, maybe I don't understand the basics of bond math. Vanguard's international bond fund has a SEC yield of 0.4% and a duration of 7.8 years. According to Bogleheads wiki duration represents the length of time it w...
by Kelly
Sun Aug 21, 2016 10:00 am
Forum: Investing - Theory, News & General
Topic: Should I get out of Vgd Total Int'l Bond Fund?
Replies: 11
Views: 1877

Re: Should I get out of Vgd Total Int'l Bond Fund?

No one can predict the future. The fund has done quite well in the past year, but does that predict the future? You might ask just as well, "Should I get out of Vg Short-term TIPS fund?" This is a bit different. Isn't it? Math drives bond returns. Probably a good portion of the past retur...
by Kelly
Sun Aug 21, 2016 7:31 am
Forum: Investing - Theory, News & General
Topic: Should I get out of Vgd Total Int'l Bond Fund?
Replies: 11
Views: 1877

Should I get out of Vgd Total Int'l Bond Fund?

I invested 25% of my bond allocation in the Total Int'l Bond fund when it was first introduced. The rest of that allocation is 50% Intermediate Bond Index and 25% Short Term Tips. Vanguard allocates 10% of its Target Retirement Income fund to Total Int'l Bond. The Total Int'l Bond fund currently yie...
by Kelly
Tue May 31, 2016 5:32 pm
Forum: Investing - Theory, News & General
Topic: TIAA Traditional account or intermediate term bond index?
Replies: 23
Views: 2132

Re: TIAA Traditional account or intermediate term bond index?

So if TIAA is under financial pressures 9 months from now, they could start paying 1% on all of your vintages of RCP Traditional.


Good to know! I missed this nuance.

Many thanks

Kelly
by Kelly
Mon May 30, 2016 12:09 pm
Forum: Investing - Theory, News & General
Topic: TIAA Traditional account or intermediate term bond index?
Replies: 23
Views: 2132

Re: TIAA Traditional account or intermediate term bond index?

Of course there are reasons. The bond fund could do better than TIAA over the long-term. The liquidity of the bond fund is more likely higher. I have TIAA TA paying more than 4.5% nowadays, but I don't have 100% of my fixed income in that. Over the years, bond funds have actually done just as well....
by Kelly
Mon May 30, 2016 11:53 am
Forum: Investing - Theory, News & General
Topic: TIAA Traditional account or intermediate term bond index?
Replies: 23
Views: 2132

Re: TIAA Traditional account or intermediate term bond index?

I don't. The TIAA rates are great in today's environment. Personally I have a 3% guarantee TIAA tIRA in place of all bonds. The only question seems to be whether you will want to withdraw some someday or can live with the restrictions. Perhaps you want a mixture of both. edit: I forgot to ask you t...
by Kelly
Mon May 30, 2016 10:43 am
Forum: Investing - Theory, News & General
Topic: TIAA Traditional account or intermediate term bond index?
Replies: 23
Views: 2132

TIAA Traditional account or intermediate term bond index?

Folks Is there any reason why someone would want to use Vanguard's Intermediate Term Bond Index (VBILX) with a 2.18% yield when they also have access to two TIAA traditional annuities? One TIAA Traditional Annuity has a 3.25% current crediting rate (Retirement Choice Plus) and doesn't appear to have...
by Kelly
Mon May 23, 2016 7:15 am
Forum: Investing - Theory, News & General
Topic: Should I annuitize my TIAA account?
Replies: 5
Views: 1346

Re: Should I annuitize my TIAA account?

Many thanks for the input. It does strike me as a good idea and I wasn't sure if I was missing anything.

Best

Kelly
by Kelly
Sun May 22, 2016 8:42 am
Forum: Investing - Theory, News & General
Topic: Deconstructing DC area home price gains
Replies: 1
Views: 337

Deconstructing DC area home price gains

Folks I'm trying to determine how much of the price gain in Wash. DC area since 1987 is attributed to inflation and how much is attributed to the decline in mortgage rates. Here's my attempt and any comments are appreciated: -Since 1987 the Case Shiller Home Price Index for the Washington DC area ha...
by Kelly
Sun May 22, 2016 7:35 am
Forum: Personal Finance (Not Investing)
Topic: Understanding How Financial Advisors Are Compensated, by Wade Pfau
Replies: 16
Views: 2550

Re: Understanding How Financial Advisors Are Compensated by Wade Pfau

So you are quibbling about "fee only" vs "Fee-Only". You say it is incorrect and then proceed to tell us why it is true.

No. A NAPFA registered, fee only advisor does not sell anything. Period. That's the clarification I wanted to make.

Kelly
by Kelly
Sun May 22, 2016 7:05 am
Forum: Personal Finance (Not Investing)
Topic: Understanding How Financial Advisors Are Compensated, by Wade Pfau
Replies: 16
Views: 2550

Re: Understanding How Financial Advisors Are Compensated by Wade Pfau

The article and table unfortunately are misleading. One would come away thinking that fee only advisors do not get commissions. He briefly notes that some advisors can switch between paid by client and paid by commissions, but he implies that these would be called fee based. Many firms call themsel...
by Kelly
Mon May 16, 2016 7:47 am
Forum: Investing - Theory, News & General
Topic: When is the last time Vanguard altered target date allocations?
Replies: 8
Views: 1359

When is the last time Vanguard altered target date allocations?

Folks

In Feb Vanguard increased international equity allocation of it's target date funds from 30% to 40%. Does anyone know of any other times that changes were made to these or any other of their funds of funds?

Many thanks

Kelly
by Kelly
Sun May 15, 2016 7:21 am
Forum: Investing - Theory, News & General
Topic: Should I annuitize my TIAA account?
Replies: 5
Views: 1346

Should I annuitize my TIAA account?

Folks I've been contributing to a TIAA traditional account for over 30 years. The account balance is $181,000. If I annuitize with a 2/3 rds survivor benefit the annual payments would be $14,940 for an annuity "rate" of 8.25% (14940/181000). Current market rates from other insurers are 6.2...
by Kelly
Sat May 07, 2016 3:57 pm
Forum: Investing - Theory, News & General
Topic: Sharpe's "Arithmetic of Active Management" explained very well
Replies: 10
Views: 1815

Sharpe's "Arithmetic of Active Management" explained very well

Good Bogelhead stuff

This article does a great job of explaining Nobel economist Bill Sharpe's "Arithmetic of Active Management" thesis

http://www.philosophicaleconomics.com/2016/05/passive/

Kelly
by Kelly
Mon May 02, 2016 7:42 pm
Forum: Investing - Theory, News & General
Topic: LifeStrategy Moderate Growth fund or its components?
Replies: 33
Views: 3827

LifeStrategy Moderate Growth fund or its components?

Folks The Vanguard portfolio builder recommended 4 funds which are the exact components and weights of the LifeStrategy Moderate Growth fund . Is there any reason why the LifeStrategy fund wouldn't produce nearly the same results if held in an IRA (assuming the individual funds were rebalanced to ta...
by Kelly
Sun Mar 27, 2016 2:33 pm
Forum: Personal Finance (Not Investing)
Topic: Raid a Roth for second home down payment or US HELOC?
Replies: 4
Views: 665

Raid a Roth for second home down payment or US HELOC?

I could use a second opinion on this. I need to come up with $100k for a down payment on a second house. I can either take this from my Roth (I've met the age and 5 year requirements) or use a home equity line of credit on the primary residence. That rate is 2.4% or 1.68% after tax assuming a 30% co...
by Kelly
Mon Mar 07, 2016 11:44 am
Forum: Investing - Theory, News & General
Topic: Historical capital gains in an index fund?
Replies: 4
Views: 716

Historical capital gains in an index fund?

Does anyone know where I can find the historical distributions of any large cap index fund? Both Morningstar and Vanguard websites only go back a couple of years.

I'm trying to determine how much, if any, long or short term capital gains an index might have distributed.

Thanks

Kelly
by Kelly
Wed Dec 09, 2015 8:35 am
Forum: Investing - Theory, News & General
Topic: Wade Pfau on Reverse Mortgages
Replies: 41
Views: 5373

Re: Wade Pfau on Reverse Mortgages

I work as a fee only (I don't sell anything) CFP. Because I charge by the hour (and don't charge much) I get a lot of middle America, blue collar pre-retirees who will have to rely on either a reverse mortgage or downsize to a condo or rent an apartment. These folks may have $200k or less saved. If ...
by Kelly
Thu Nov 26, 2015 5:54 pm
Forum: Investing - Theory, News & General
Topic: Why do FDIC insured CDs yield more than treasuries?
Replies: 36
Views: 5397

Why do FDIC insured CDs yield more than treasuries?

Folks, A treasury maturing in one year yields 0.48% but Ally bank has a one year FDIC insured CD yielding 1.05%. Unless I'm missing something the risk is the same: none. My guess is that there's simply much more institutional money flowing into treasuries pushing the yield down. If that is the reaso...
by Kelly
Sun Oct 25, 2015 1:09 pm
Forum: Investing - Theory, News & General
Topic: Between rock and hard place in 401k large cap
Replies: 4
Views: 737

Between rock and hard place in 401k large cap

Folks, What's the better of these two bad options for 401k large cap: Principal SP 500 index at 0.70% ER or American Funds Fundamental Investor R (RFNCX) at 0.96% ER (large blend). The American Funds 3 and 5 year returns would be worse than the Principal SP 500. Other time periods it's better. Here'...
by Kelly
Tue Oct 20, 2015 4:31 pm
Forum: Investing - Theory, News & General
Topic: Question about index holdings
Replies: 1
Views: 340

Question about index holdings

Vanguard SP 500 index's top three holdings are Apple, Microsoft, Exxon m The value index's top three holdings are Microsoft, Exxon, Johnson and Johnson m I can see how Exxon is in both because it has a large market cap and it's high price to book. But Microsoft isn't value according to the M* style ...
by Kelly
Mon Oct 05, 2015 2:34 pm
Forum: Personal Finance (Not Investing)
Topic: Northwestern Mutual Whole Life Insurance (65 Life)
Replies: 35
Views: 8754

Re: Northwestern Mutual Whole Life Insurance (65 Life)

5) Cash value can be borrowed for whatever you want, whenever you want. The loan is set ~6%, but really it only costs about 2% since the principle that is borrowed will continue to earn interest. You don't really ever have to pay back the loan since the company will just deduct what is owed from th...
by Kelly
Mon Oct 05, 2015 2:26 pm
Forum: Personal Finance (Not Investing)
Topic: Northwestern Mutual Whole Life Insurance (65 Life)
Replies: 35
Views: 8754

Re: Northwestern Mutual Whole Life Insurance (65 Life)

James Hunt is a retired life actuary who evaluates policies for the consumer federation of america. He charges $100 to work out the internal rate of return of the policy and tell you whether it's worth keeping. I would guess it's returning about 4% so you could treat it as part of your bond allocati...
by Kelly
Sun Oct 04, 2015 9:31 am
Forum: Investing - Theory, News & General
Topic: IBT interview with Dr. Bill Bernstein
Replies: 80
Views: 8552

Re: IBT interview with Dr. Bill Bernstein

I'm always hoping BB will write more books. I've read all of his, many twice and 4 pillars more than that. Maybe we can talk him into another addition to the investing for adults series.
by Kelly
Fri Sep 25, 2015 9:43 am
Forum: Investing - Theory, News & General
Topic: Need idea for teen supply demand exercise
Replies: 12
Views: 1422

Need idea for teen supply demand exercise

Folks I'm teaching investing basics at a local high school on Monday. I have an idea that I will relate basic supply and demand to stock prices. I need some form of simple exercise to demonstrate supply and demand. I've found one idea online that involves splitting the class in half and asking one h...
by Kelly
Tue Sep 22, 2015 11:15 am
Forum: Investing - Theory, News & General
Topic: What are the index fund costs beyond bid ask?
Replies: 13
Views: 1281

Re: What are the index fund costs beyond bid ask?

It does seem that Int'l funds are always costlier regardless of size. Any insight? The phone desk at VGD didn't know the full story either. Although, interestingly, he suspected that some of the cost difference may be attributed to the assumption that one index provider cost more than another. Kelly
by Kelly
Mon Sep 21, 2015 10:40 pm
Forum: Investing - Theory, News & General
Topic: What are the index fund costs beyond bid ask?
Replies: 13
Views: 1281

What are the index fund costs beyond bid ask?

My apologies if this has already been covered. If it has I can't find it. The SP 500 (VFINX) has an expense of 0.17%, while the Mid Cap (VISMX) costs 0.23%. Is there anything beyond bid ask to account for Mid Caps higher price? FTSE All World Ex US (VFWIX) cost 0.29%. Are there additional costs beca...