Search found 4648 matches

by KlangFool
Mon Feb 20, 2017 10:51 pm
Forum: Investing - Help with Personal Investments
Topic: [What] to Do When Income Too High for Roth IRA
Replies: 10
Views: 537

Re: [What] to Do When Income Too High for Roth IRA

How do you know that you no longer qualify for Roth IRA contribution? KlangFool http://www.rothira.com/2017-roth-ira-limits-announced Maybe I'm missing something here Klangfool, but they are over the limit for this year likely based on the 174k+40k = 214k. Unless you are talking about the 2016 tax ...
by KlangFool
Mon Feb 20, 2017 10:28 pm
Forum: Investing - Help with Personal Investments
Topic: [What] to Do When Income Too High for Roth IRA
Replies: 10
Views: 537

Re: [What] to Do When Income Too High for Roth IRA

Hello everyone, I'm brand new here but am thankful for the wealth of information I have encountered. I am married and am curious how to save more for retirement after maxing out my 401k and her traditional IRA for the year. I would normally contribute to my Roth IRA but my wife just accepted a new ...
by KlangFool
Mon Feb 20, 2017 10:06 pm
Forum: Personal Finance (Not Investing)
Topic: Moving assets to taxable accounts for inheritance
Replies: 9
Views: 1005

Re: Moving assets to taxable accounts for inheritance

You will probably find that in the early years of RMDs (early 70s), the accounts continue to grow faster than the RMDs that are withdraw each year. If you want to control them better, you may want to take bigger withdrawals in the early years even if it means going up to a higher tax bracket. (Lowe...
by KlangFool
Mon Feb 20, 2017 6:22 pm
Forum: Investing - Help with Personal Investments
Topic: 20% bonds: why bother at 48?
Replies: 106
Views: 4145

Re: 20% bonds: why bother at 48?

Dirghatamas, I would like you to answer the following question. At 2008/2009, 1) Would you sell a large portion of your stock and convert to cash if you are unemployed and you do not know whether you will ever find employment again? 2) Or, your answer is I do not know because I never have to face t...
by KlangFool
Mon Feb 20, 2017 5:29 pm
Forum: Investing - Help with Personal Investments
Topic: 20% bonds: why bother at 48?
Replies: 106
Views: 4145

Re: 20% bonds: why bother at 48?

The part I find puzzling is this discussion of "sequence of returns risk". People assume that at the worst time, suddenly stocks will lose 50% and stay there. So apparently it is unwise to sell stocks during the downturn for living expenses and somehow a small portion of bonds will carry ...
by KlangFool
Mon Feb 20, 2017 3:47 pm
Forum: Investing - Help with Personal Investments
Topic: Reinvesting dividends and cap gains in taxable account
Replies: 10
Views: 815

Re: Reinvesting dividends and cap gains in taxable account

Let me rephrase. No shares to be sold unless a market decline and thus brings the opportunity to sell at a loss and purchases shares of Total International. Triple digit golfer, So, the answer remained the same. You should not reinvest the dividend and cap gain of this stock fund automatically. You...
by KlangFool
Mon Feb 20, 2017 3:18 pm
Forum: Personal Finance (Not Investing)
Topic: Moving assets to taxable accounts for inheritance
Replies: 9
Views: 1005

Re: Moving assets to taxable accounts for inheritance

OP, Let me give you another alternative to think about. How about this couple contribute/give money directly to the next generation's Roth IRA? If I am going to pass my money to the next generation, I want to give some of them out before I die. A) I get to see how they are being used. B) I get to se...
by KlangFool
Mon Feb 20, 2017 3:05 pm
Forum: Investing - Help with Personal Investments
Topic: Reinvesting dividends and cap gains in taxable account
Replies: 10
Views: 815

Re: Reinvesting dividends and cap gains in taxable account

I have a taxable account, but I am not contributing to it. I have FTSE All World ex-US index fund and Intermediate Term Tax Exempt. The former is intended to only be used for retirement and thus no shares to be sold for decades, barring a very large emergency. The latter is a second tier to my emer...
by KlangFool
Mon Feb 20, 2017 1:25 pm
Forum: Investing - Help with Personal Investments
Topic: 20% bonds: why bother at 48?
Replies: 106
Views: 4145

Re: 20% bonds: why bother at 48?

Looks like I have some adjustment to do from 88/12, then! Remember that Klangfool is a bit of a 'prepper' in the financial world. He views that you should be ready at a moment's notice to begin making early withdrawals from your accounts in order to meet your immediate financial needs. It's fine if...
by KlangFool
Mon Feb 20, 2017 1:16 pm
Forum: Investing - Help with Personal Investments
Topic: 20% bonds: why bother at 48?
Replies: 106
Views: 4145

Re: 20% bonds: why bother at 48?

Looks like I have some adjustment to do from 88/12, then! Remember that Klangfool is a bit of a 'prepper' in the financial world. He views that you should be ready at a moment's notice to begin making early withdrawals from your accounts in order to meet your immediate financial needs. It's fine if...
by KlangFool
Mon Feb 20, 2017 1:10 pm
Forum: Investing - Help with Personal Investments
Topic: 20% bonds: why bother at 48?
Replies: 106
Views: 4145

Re: 20% bonds: why bother at 48?

https://personal.vanguard.com/us/insights/investingtruths/investing-truth-about-risk Folks, Look at the average return of each AA. 100/0 10.2% 90/10 9.9% 80/20 9.6% 70/30 9.2% Let's compare 100/0 versus 80/20. The average return is between 10.2% versus 9.6% = + 0.6%. The maximum loss for 100/0 is 5...
by KlangFool
Mon Feb 20, 2017 12:52 pm
Forum: Investing - Help with Personal Investments
Topic: 20% bonds: why bother at 48?
Replies: 106
Views: 4145

Re: 20% bonds: why bother at 48?

https://personal.vanguard.com/us/insights/investingtruths/investing-truth-about-risk Folks, Look at the average return of each AA. 100/0 10.2% 90/10 9.9% 80/20 9.6% 70/30 9.2% Let's compare 100/0 versus 80/20. The average return is between 10.2% versus 9.6% = + 0.6%. The maximum loss for 100/0 is 5...
by KlangFool
Mon Feb 20, 2017 11:51 am
Forum: Investing - Help with Personal Investments
Topic: 20% bonds: why bother at 48?
Replies: 106
Views: 4145

Re: 20% bonds: why bother at 48?

https://personal.vanguard.com/us/insights/investingtruths/investing-truth-about-risk Folks, Look at the average return of each AA. 100/0 10.2% 90/10 9.9% 80/20 9.6% 70/30 9.2% Let's compare 100/0 versus 80/20. The average return is between 10.2% versus 9.6% = + 0.6%. The maximum loss for 100/0 is 50...
by KlangFool
Mon Feb 20, 2017 9:56 am
Forum: Investing - Theory, News & General
Topic: Tax Implications of Drawdown from Different Account Types
Replies: 9
Views: 427

Re: Tax Implications of Drawdown from Different Account Types

And then, I suppose, to tag on to the above, how would the traditional account fall into the brackets. You are taxed (assuming married filing jointly again) at 10% up to $9325, then 15% up to $37,950, then 25% above. Does that mean the $33,333 from traditional would only fall into the 10% and 15% b...
by KlangFool
Sun Feb 19, 2017 6:22 pm
Forum: Personal Finance (Not Investing)
Topic: Is there ideal Asset LOCATION % as you get closer to retirement?
Replies: 45
Views: 2160

Re: Is there ideal Asset LOCATION % as you get closer to retirement?

Folks, Somebody assume that a person could be 100% in tax- deferred with 2.5 million . I believe we had proved that the possibility is slim to none. KlangFool I don't think there's any way to actually do those calculations yourself, so you'll have to rely on figures that have been published. Over t...
by KlangFool
Sun Feb 19, 2017 5:15 pm
Forum: Personal Finance (Not Investing)
Topic: Is there ideal Asset LOCATION % as you get closer to retirement?
Replies: 45
Views: 2160

Re: Is there ideal Asset LOCATION % as you get closer to retirement?

Folks, Somebody assume that a person could be 100% in tax- deferred with 2.5 million . I believe we had proved that the possibility is slim to none. KlangFool I don't know how you can make such a declaration. Going by your own numbers that you stated, with a $150k gross and 30% savings - that's $45...
by KlangFool
Sun Feb 19, 2017 4:01 pm
Forum: Personal Finance (Not Investing)
Topic: Should we purchase a $1 Million dollar home with all cash?
Replies: 41
Views: 4587

Re: Should we purchase a $1 Million dollar home with all cash?

OP,

1) How many eggs do you put into this one basket (house) after you purchase this $1 million house with cash?

2) How much money do you have besides the house after paying 1 million cash?

3) Are you comfortable with your answer to (2)?

A) If yes, why?

B) If no, why?

KIangFool
by KlangFool
Sun Feb 19, 2017 3:25 pm
Forum: Personal Finance (Not Investing)
Topic: Is there ideal Asset LOCATION % as you get closer to retirement?
Replies: 45
Views: 2160

Re: Is there ideal Asset LOCATION % as you get closer to retirement?

Folks,

Somebody assume that a person could be 100% in tax- deferred with 2.5 million. I believe we had proved that the possibility is slim to none.

KlangFool
by KlangFool
Sun Feb 19, 2017 3:15 pm
Forum: Personal Finance (Not Investing)
Topic: Is there ideal Asset LOCATION % as you get closer to retirement?
Replies: 45
Views: 2160

Re: Is there ideal Asset LOCATION % as you get closer to retirement?

I arrived in the US 4 years ago, so the question doesn't apply. However, I have a decent idea of starting salaries for my job, so I can say that yes, if I graduated in the US, and had sufficient financial knowledge, I would have been contributing the max. amount from the start, though perhaps waiti...
by KlangFool
Sun Feb 19, 2017 3:07 pm
Forum: Personal Finance (Not Investing)
Topic: Is there ideal Asset LOCATION % as you get closer to retirement?
Replies: 45
Views: 2160

Re: Is there ideal Asset LOCATION % as you get closer to retirement?

ved, In theory, yes. In real world? I am a lifetime 30+% gross income saver. I could not even reach half of that number. I max my Trad. 401K every year for 20+ years with the exception of maybe 5 years in total. <<Let's say, In the first 10 years, they contribute $10k per year.>> Student loan and l...
by KlangFool
Sun Feb 19, 2017 3:04 pm
Forum: Personal Finance (Not Investing)
Topic: Is there ideal Asset LOCATION % as you get closer to retirement?
Replies: 45
Views: 2160

Re: Is there ideal Asset LOCATION % as you get closer to retirement?

I'm afraid several of your assumptions are wrong: A) The only kind of employer that are willing to contribute to the max is the self-employed people. Without going into details, I can guarantee that all of the senior managers and executives at both my company and my wife's company, are at the $54k ...
by KlangFool
Sun Feb 19, 2017 2:56 pm
Forum: Personal Finance (Not Investing)
Topic: Is there ideal Asset LOCATION % as you get closer to retirement?
Replies: 45
Views: 2160

Re: Is there ideal Asset LOCATION % as you get closer to retirement?

Klang, As Ethelred pointed out, $2.5 mil for a couple in trad tax-deferred accounts by the time they retire is not out of the ordinary. I just did a quick excel calculation,with a couple having 35 years of working life, and their contributions (including any employer matching) to tax-deferred accou...
by KlangFool
Sun Feb 19, 2017 2:03 pm
Forum: Investing - Theory, News & General
Topic: Combining Wellesley and the Larry Portfolio
Replies: 8
Views: 851

Re: Combining Wellesley and the Larry Portfolio

OP, How could anyone tell you that whether it is a good idea unless you tell them your goal in doing this? I have Wellington fund, 3 funds, and Larry portfolio. In my case, I am doing the Larry portfolio because I am increasing bond ratio and tilting to the small cap value at the same time. Aka, I a...
by KlangFool
Sun Feb 19, 2017 1:44 pm
Forum: Personal Finance (Not Investing)
Topic: How Long to Keep Medical Insurance EOB Statements?
Replies: 13
Views: 1176

Re: How Long to Keep Medical Insurance EOB Statements?

DW & I just transitioned to Medicare + a Medicare Supplement plan for our health insurance. We've been getting inundated with paper explanation of benefit statements in the mail for several months now. Any idea on how long we should hang on to these things? Any reason to hang on to them once th...
by KlangFool
Sun Feb 19, 2017 1:40 pm
Forum: Personal Finance (Not Investing)
Topic: Is there ideal Asset LOCATION % as you get closer to retirement?
Replies: 45
Views: 2160

Re: Is there ideal Asset LOCATION % as you get closer to retirement?

ved, <<When does a tax-deferred amount be too much at retirement? >> <<I would think having all $2.5 mil in tax-deferred is not ideal. >> I am not quite sure that this is possible. There is a limited amount of tax deferred space available (18K for less than 50 years old, 24K for 50 and above) every...
by KlangFool
Sun Feb 19, 2017 12:22 pm
Forum: Investing - Help with Personal Investments
Topic: 401k Decision - Trad vs Roth
Replies: 44
Views: 1459

Re: 401k Decision - Trad vs Roth

Assuming the parents had those skills in the first place? Dyloot, It is still not the school's responsibility. It takes a village to raise a child. I do not believe using the school as the default answer for everything. If you believe this is a problem, teach whoever that you care about to learn th...
by KlangFool
Sun Feb 19, 2017 10:52 am
Forum: Investing - Theory, News & General
Topic: US debt approaching $20 Trillion
Replies: 18
Views: 1085

Re: US debt approaching $20 Trillion

Folks,

If you bet that inflation will go up and US dollar's value will go down, why would you pay off your fixed 15/30 years mortgage?

KlangFool
by KlangFool
Sun Feb 19, 2017 10:50 am
Forum: Investing - Theory, News & General
Topic: US debt approaching $20 Trillion
Replies: 18
Views: 1085

Re: US debt approaching $20 Trillion

I have always been amazed at how much faith foreigners have in the US $, given the debt level :confused Personally I feel that the biggest danger is to the $ rather than directly to the stock market. What if the Chinese dump US Treasuries... That will lead to US interest rates having to be raised, ...
by KlangFool
Sun Feb 19, 2017 10:47 am
Forum: Investing - Theory, News & General
Topic: US debt approaching $20 Trillion
Replies: 18
Views: 1085

Re: US debt approaching $20 Trillion

With US debt approaching $20T and other unfunded federal govt debt obligations around $100T - how will the next 15-25 year horizon affect stock market? I think with higher debt repayment obligations, the county will not have resources to invest in infrastructure and development - You cannot print m...
by KlangFool
Sun Feb 19, 2017 10:44 am
Forum: Personal Finance (Not Investing)
Topic: Is there ideal Asset LOCATION % as you get closer to retirement?
Replies: 45
Views: 2160

Re: Is there ideal Asset LOCATION % as you get closer to retirement?

In retirement, it is better to spend bonds and keep stocks in your taxable account. The reason is that the income from bonds is taxed at your full rate (or, if you hold munis, you accept a lower yield to avoid paying the tax), while bonds can be sold at little or no tax cost. Meanwhile, income from...
by KlangFool
Sat Feb 18, 2017 10:23 pm
Forum: Personal Finance (Not Investing)
Topic: Is there ideal Asset LOCATION % as you get closer to retirement?
Replies: 45
Views: 2160

Re: Is there ideal Asset LOCATION % as you get closer to retirement?

When does a tax-deferred amount be too much at retirement? Let's say the expenses in retirement will be about $100k. Assume you will have a portfolio ($2.5 mil that supports the 4% withdrawal) that will support that $100k distribution (thru trad, Roth & taxable). In this case, what should the m...
by KlangFool
Sat Feb 18, 2017 10:02 pm
Forum: Investing - Help with Personal Investments
Topic: Portfolio review for 31 year old married couple with baby on the way
Replies: 4
Views: 548

Re: Portfolio review for 31 year old married couple with baby on the way

Thanks for your reply. I'd like to keep international in taxable. I currently hold bonds in the rollover IRA. I would like to keep them out of the Roth and use Roth space for equities since they are expected to grow faster. I am totally open to recommendations, up to reworking the entire portfolio ...
by KlangFool
Sat Feb 18, 2017 9:03 pm
Forum: Investing - Help with Personal Investments
Topic: Portfolio review for 31 year old married couple with baby on the way
Replies: 4
Views: 548

Re: Portfolio review for 31 year old married couple with baby on the way

OP, 1) If you sell something for a loss at the taxable account and buy something that is substantially identically back within 30 days, you had triggered a wash sale. It is not a show stopper but it is something you would want to avoid if possible. https://www.bogleheads.org/wiki/Wash_sale 2) So, to...
by KlangFool
Sat Feb 18, 2017 8:22 pm
Forum: Investing - Help with Personal Investments
Topic: Question on cash needs in taxable account
Replies: 19
Views: 1168

Re: Question on cash needs in taxable account

Any takers? :happy Please start a new thread with the information from the previous post and ask the question. Then, you will have more responses. 1) Change the subject line to portfolio review. 2) Ask the question about A) Tax efficiency B) Tax Loss Harvesting in the taxable account C) How to get ...
by KlangFool
Sat Feb 18, 2017 5:51 pm
Forum: Investing - Help with Personal Investments
Topic: 401k Decision - Trad vs Roth
Replies: 44
Views: 1459

Re: 401k Decision - Trad vs Roth

Assuming the parents had those skills in the first place? Dyloot, It is still not the school's responsibility. It takes a village to raise a child. I do not believe using the school as the default answer for everything. If you believe this is a problem, teach whoever that you care about to learn th...
by KlangFool
Sat Feb 18, 2017 4:57 pm
Forum: Investing - Help with Personal Investments
Topic: 401k Decision - Trad vs Roth
Replies: 44
Views: 1459

Re: 401k Decision - Trad vs Roth

Hedge your bets and diversify your tax accounts. It works when investing in equities! basspond, And, in order to do that, you do not contribute to Roth 401K. That keeps all your money in a Roth account with the additional 401K restriction. And, you use up your tax-deferred space. Contribute to Trad...
by KlangFool
Sat Feb 18, 2017 4:56 pm
Forum: Investing - Help with Personal Investments
Topic: 401k Decision - Trad vs Roth
Replies: 44
Views: 1459

Re: 401k Decision - Trad vs Roth

Thank you for all the feedback. In my actual situation, my wife has a 1% x years of service x final salary pension. We also contribute $11,000 annually to Roth IRAs that we will also be using for our 2 children's education when the time comes, (1 is 1 yo, 1 will be TBD). This standard contribution ...
by KlangFool
Sat Feb 18, 2017 12:36 pm
Forum: Personal Finance (Not Investing)
Topic: Ideas for tiered emergency fund
Replies: 23
Views: 1589

Re: Ideas for tiered emergency fund

Total investments are about 290k, all in non-taxable. Not including whatever pension my wife will get from being a teacher. Have 529 for each kid (8,10) of 18k and growing with regular contributions. Have mortgage of 398k on house worth 530k. I max my 401k and we max IRAs. My wife and I are 43. jb3...
by KlangFool
Sat Feb 18, 2017 12:10 pm
Forum: Personal Finance (Not Investing)
Topic: Ideas for tiered emergency fund
Replies: 23
Views: 1589

Re: Ideas for tiered emergency fund

That 80k is roughly 14 months of living expenses (not counting my wife's salary which makes up 40% of our total income). I have no way to determine how safe my job is.  Like many jobs, it could go at any time.  My next job would almost certainly pay less. jb3, How big is your overall portfolio? If ...
by KlangFool
Sat Feb 18, 2017 11:55 am
Forum: Investing - Help with Personal Investments
Topic: Bonds in Taxable? 20% Tax Bracket
Replies: 5
Views: 469

Re: Bonds in Taxable? 20% Tax Bracket

Hi Folks, I am a rookie to the concept of tax efficient and tax inefficient concepts. Please help me out in understanding if my thinking is right 1. I was wondering if I can place the Bonds in my taxable account. I got 20k total in ROTH IRA. 10k in bonds and 10 k in REITS . 2. I have 80k stocks in ...
by KlangFool
Sat Feb 18, 2017 11:48 am
Forum: Personal Finance (Not Investing)
Topic: Ideas for tiered emergency fund
Replies: 23
Views: 1589

Re: Ideas for tiered emergency fund

I have an 80k emergency fund, which is probably too much but I tend to be conservative/cautious. The 80k is currently all in an Ally savings account earning 1‰. I am considering putting a portion of that 80k (maybe 1/3 or so) into something that earns more than 1%. This "second tier" of e...
by KlangFool
Sat Feb 18, 2017 7:48 am
Forum: Investing - Help with Personal Investments
Topic: Question on cash needs in taxable account
Replies: 19
Views: 1168

Re: Question on cash needs in taxable account

Thanks to you both. Where I'm at is a total portfolio including all retirement and taxable accounts, of $500k. With Livesoft's advice, my wife and I want to look at all money in one portfolio. We want to have an emergency plan, not necessarily an emergency fund. Where were at now is a $500k portfol...
by KlangFool
Sat Feb 18, 2017 7:43 am
Forum: Investing - Help with Personal Investments
Topic: Question on cash needs in taxable account
Replies: 19
Views: 1168

Re: Question on cash needs in taxable account

Triple digit golfer, Why? It is still interest income and taxed as ordinary income. Meanwhile, you get qualified dividend from stock which is taxed the same as long-term capital gain. Long-term capital gain tax is lower than ordinary income tax. So, how can this be better? KlangFool If I may, From ...
by KlangFool
Sat Feb 18, 2017 7:39 am
Forum: Investing - Help with Personal Investments
Topic: 401k Decision - Trad vs Roth
Replies: 44
Views: 1459

Re: 401k Decision - Trad vs Roth

You need to give the complete story. Or else, somebody reading your post will get confused again. $26K/year alone will not do it. You will need some amount of SS income and pension. So, what is that number? Many of us do not qualify for any pension. That immediately rule this out. And, SS income is...
by KlangFool
Sat Feb 18, 2017 7:29 am
Forum: Investing - Help with Personal Investments
Topic: 401k Decision - Trad vs Roth
Replies: 44
Views: 1459

Re: 401k Decision - Trad vs Roth

Hedge your bets and diversify your tax accounts. It works when investing in equities! basspond, And, in order to do that, you do not contribute to Roth 401K. That keeps all your money in a Roth account with the additional 401K restriction. And, you use up your tax-deferred space. Contribute to Trad...
by KlangFool
Sat Feb 18, 2017 12:58 am
Forum: Investing - Help with Personal Investments
Topic: 401k Decision - Trad vs Roth
Replies: 44
Views: 1459

Re: 401k Decision - Trad vs Roth

So, under what condition could the whole 260K be taxed at 28%? Please explain the condition so that people could figure out how ridiculous that it can be. And, if they know this, it is totally avoidable. KlangFool, $26K/yr for 10 years would do it. Of course, if you want to discuss "why withdr...
by KlangFool
Sat Feb 18, 2017 12:48 am
Forum: Investing - Help with Personal Investments
Topic: 401k Decision - Trad vs Roth
Replies: 44
Views: 1459

Re: 401k Decision - Trad vs Roth

Divide all the dollar numbers by 10 and the problem with investor999's example remains: it used a 23% contribution tax and a 28% withdrawal tax. Yes, under those conditions, Roth is better. FiveK, 23% contribution tax is better than 28% withdrawal? In his case/example, he is contributing at 28% tax...
by KlangFool
Sat Feb 18, 2017 12:30 am
Forum: Investing - Help with Personal Investments
Topic: 401k Decision - Trad vs Roth
Replies: 44
Views: 1459

Re: 401k Decision - Trad vs Roth

https://taxfoundation.org/2017-tax-brackets/ With the annual gross income of 24K + 12K + 10K = 46K, how do you hit 28% marginal tax rate? It is 15%. Note that your marginal tax rate may be the same as your tax bracket, but it also may not be. Below shows the marginal rates for tIRA withdrawals, giv...
by KlangFool
Sat Feb 18, 2017 12:25 am
Forum: Investing - Help with Personal Investments
Topic: 401k Decision - Trad vs Roth
Replies: 44
Views: 1459

Re: 401k Decision - Trad vs Roth

Are you so sure that our tax rates won't revert to the mean? We are at historically nearly the lowest tax rates we've ever had. I doubt we can keep amassing debt without even considering a tax rate increase. investor999, Let me throw down a challenge for you, under what tax rate condition will the ...
by KlangFool
Sat Feb 18, 2017 12:18 am
Forum: Investing - Help with Personal Investments
Topic: 401k Decision - Trad vs Roth
Replies: 44
Views: 1459

Re: 401k Decision - Trad vs Roth

Klang having some inRoth if you have no savings outside your Ira you can replace roofs,cars vacations without having to pay taxes on top off the expensive items. Another way to diversify. nodenuff2, I am not arguing against Roth IRA. Only Roth 401K. My standard advice is to max up Trad. 401K and pu...

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