Search found 28712 matches

by Watty
Mon Mar 18, 2024 5:39 pm
Forum: Personal Investments
Topic: Portfolio Advice Needed - Can I Retire?
Replies: 16
Views: 1391

Re: Portfolio Advice Needed - Can I Retire?

Want to go to $100k to include vacations/niceties/etc.... .... Age: Me 59.5yr and my wife is 58. .... Portfolio total: Approx $ 3.2mil. ...... Social Security: His: $55.8k yearly if collected at planned age 70 1) Can I retire? This is my main question. You are making this too complicated by combining the "can I" question with the "how to" part of the question. Sometimes when the answer is not close a very rough back of the envelope calculation is better than a 10 page thesis. You seem to like buckets so you might l consider two buckets; 1) up to the age of 70 and 2) after the age of 70 when you will be on Medicare and getting at least one Social Security check even if only one of you is surviving. For bucket 1 up to age...
by Watty
Sun Mar 17, 2024 7:47 pm
Forum: Personal Consumer Issues
Topic: Pretty set financially, but considering relocation to VHCOL (Bay Area) for the career/adventure
Replies: 17
Views: 1835

Re: Pretty set financially, but considering relocation to VHCOL (Bay Area) for the career/adventure

Low 7 figures net worth ..... Would be increasing salary from $240K..... .... In my L/MCOL, housing prices have doubled in the last 2-3 years. ..... Even after the home prices increasing I would suspect that you have enough that you could pay cash for a house in a low to medium cost of living area. It has been a long time since I lived in the Bay Area but one thing to realize is that many houses in the Bay Area are tiny and sometimes even less than 1,000 square feet. Not only are they expensive but you don't get a lot for your money. Moving back in a few years might not be as easy if you change your mind. The problem is that you will be getting close to 40 and tech jobs can be a lot harder to get as you get older. There might also be a rec...
by Watty
Sun Mar 17, 2024 10:19 am
Forum: Personal Finance (Not Investing)
Topic: RMDs On A Combined IRA With RMD/Non-RMD Age Gap
Replies: 6
Views: 428

Re: RMDs On A Combined IRA With RMD/Non-RMD Age Gap

You can't combine IRA accounts other than to make your spouse the beneficiary if you want to do that.

My understanding is that you would just need to do the RMD calculations using each others ages since there is more than a ten year age difference.

https://www.bogleheads.org/wiki/Require ... stribution
by Watty
Sun Mar 17, 2024 10:13 am
Forum: Personal Consumer Issues
Topic: Pointers for Buying 2024 Honda Odyssey EX-L
Replies: 11
Views: 942

Re: Pointers for Buying 2024 Honda Odyssey EX-L

Q1: I am not keen on Dealer Installed Equipment, $995. Is there a value in keeping it? It is likely already installed on the car so it cannot be removed. They also gave you a discount off MSRP of about $2,700 so just think of the real discount from MSRP as being $1,700. Look to see what the "fees" are. One of them may be a "doc fee" of something like $500 which is just additional profit for them which would reduce their discount from MSRP to $1,200(??). You may also be able to look up the invoice price to get an idea of what the dealer is paying for the car but there are also likely other holdbacks and incentives for the dealer so they actually paid less. In normal times it is best to negotiate up from invoice and not do...
by Watty
Sun Mar 17, 2024 9:24 am
Forum: Personal Finance (Not Investing)
Topic: Analyze my Social Security payout
Replies: 9
Views: 900

Re: Analyze my Social Security payout

Also keep in mind that if you did not hit the maximum income that is taxed by SS in 2021 or 2022 then that may mean that you could not get the maximum possible SS for people that retired turn 70 in 2024.

You might have 35 years of where you had the maximum earnings but some of your years may have been long ago when the maximum, adjusted for inflation, was lower.

I don't recall the details but the amount of maximum amount of your income which is taxed by SS has increased a lot when the tax laws were. Back in the 1980s and 1990s a lot of middle class workers would earn enough so that the last few paychecks of the year were larger because they had reached the maximum income taxed by SS.

https://www.ssa.gov/oact/cola/examplemax.html
by Watty
Sun Mar 17, 2024 8:47 am
Forum: Personal Finance (Not Investing)
Topic: Analyze my Social Security payout
Replies: 9
Views: 900

Re: Analyze my Social Security payout

I noticed that for the 1st 3 months of 2024 my benefit has not changed, even though last year I exceeded the wage based limit in earned income. By the way, I am self employed and still work. Even if you have already filed your 2023 taxes it will take some time for it to be processed and for Social Security to update your benefit amount. It looks like it should be retroactive once that happens. https://www.ssa.gov/benefits/retirement/planner/whileworking.html Each year, we review the records of all Social Security beneficiaries who have wages reported for the previous year. If your latest year of earnings is one of your highest years, we recalculate your benefit and pay you any increase you are due. The increase is retroactive to January of...
by Watty
Sun Mar 17, 2024 8:30 am
Forum: Personal Consumer Issues
Topic: Should I buy a $3k camera lens or get a cheaper lens instead?
Replies: 25
Views: 1555

Re: Should I buy a $3k camera lens or get a cheaper lens instead?

I can't decide if I should just buy once, cry once, and be happy with the pricier Sony lens or listen to my financially sensible side and say that a Sigma or Tamron lens is fine for my personal use. Lately, as life is short, I kind of have been tilting to buy the thing I want even if it is more expensive, but sometimes I think it is just lifestyle creep (which if part of a permanent inclination would be detrimental to my long term goals). One way to look at the money is that if the new Sony costs $2K more than a used Sigma or Tamron then if you can reduce your spending in some other part of your budget by $2K then there is not a net financial impact. For example if you have money budgeted for travel or to replace a car then you might be ab...
by Watty
Sat Mar 16, 2024 9:49 pm
Forum: Personal Consumer Issues
Topic: Should I buy a $3k camera lens or get a cheaper lens instead?
Replies: 25
Views: 1555

Re: Should I buy a $3k camera lens or get a cheaper lens instead?

Have you rented these lenses to actually try them out?
Hubub wrote: Sat Mar 16, 2024 9:25 pm Sigma lens 70-200 2.8 or Tamron 70-180 2.8: ~$1.5k, both considered excellent values, but not the "best", minor reduction in features, lower resale value
If they have a low resale value then how much would one of these cost used?
by Watty
Sat Mar 16, 2024 9:31 pm
Forum: Personal Consumer Issues
Topic: Yearly AC tune up?
Replies: 14
Views: 1939

Re: Yearly AC tune up?

I had a 10 year P&L warranty that required annual 'tune-ups'. I had that too. Part of being on their service plan is also that you get priority when you get have a problem and I have found that to be true. I live in Atlanta where there are a couple of months in the summer when you would not want to be without AC and you would be hard pressed to get A/C service as a new customer when it is 90+ degrees and humid. I have also had HVAC people try doing hard sells and suggesting that systems should be replaced when they had years more life in them. There is more risk of that when you have a new HVAC company show up on the hottest day of the year. One big benefit of having my HVAC serviced is that if there is a problem I will not have to try...
by Watty
Sat Mar 16, 2024 10:57 am
Forum: Personal Investments
Topic: Moving Money Around? Seeking Advice for New Boglehead!
Replies: 8
Views: 997

Re: Moving Money Around? Seeking Advice for New Boglehead!

- Should I be focusing on increasing my emergency fund and destroying debt as my first priority? Or, should I work to build my investment portfolio given I have little consumer debt and 3-months expenses already saved? Build up your emergency fund. This will give you a lot more options when you graduate and you will be under less pressure to accept a mediocre position. I was once in a position where I wanted to move to a different part of the country so I planned on a job hunting trip there and was willing to pay my own moving expenses. You are much more likely to get interviews when you can tell a company that you will be in town a certain week and would like to talk to them then. I was also willing to move myself since all it would invol...
by Watty
Sat Mar 16, 2024 10:21 am
Forum: Personal Finance (Not Investing)
Topic: Full Time RV/travel pre-Medicare insurance
Replies: 6
Views: 881

Re: Full Time RV/travel pre-Medicare insurance

Appreciate any insight from those who've done something similar. I was not RVing but before I got on Medicare I had a Kaiser ACA plan so I researched about how it would work when I was traveling. There are of course a lot of details but they have a procedure for emergency care, urgent care, and telemedicine when you are outside your area which sounded reasonable. I would think most plans cover emergency and urgent care when traveling like this. With Kaiser this even applies when you are out of the country but you may need to pay for this then get reimbursed. Kaiser only serves about eight regions in the country and each of the regions is separate so normally you would only see doctors within your region. If you need non-urgent care outside...
by Watty
Sat Mar 16, 2024 9:31 am
Forum: Personal Consumer Issues
Topic: Buying an Expensive Car
Replies: 79
Views: 6262

Re: Buying an Expensive Car

- AWD is nice because I snowboard/mountain bike, but obviously that doesn’t require spending 100k In my prior post I mentioned that the opportunity cost of buying the car would be what you would need to give up to be able if you buy the car. I don't do snowboarding or mountain biking but New Zealand is a fantastic place to visit and I would assume that both of those would be great there. To me taking trips to places like New Zealand, Australia, the european Alps, Africa, etc when you are in your 30s would be a lot better use of the money than an expensive car. You might even be able to arrange to take a three to six month sabbatical from your job to travel while you are young, single, and doing great financially. The opportunity cost of bu...
by Watty
Fri Mar 15, 2024 10:58 pm
Forum: Personal Consumer Issues
Topic: Buying an Expensive Car
Replies: 79
Views: 6262

Re: Buying an Expensive Car

In economics there is the concept of Opportunity Cost where instead of stating a cost in terms of dollars you can express the cost in terms of what you would have to give up to buy it. For example a teenager might have enough to go to a movie or buy a pizza but not both. The opportunity cost of seeing the movie is not being able to eat the pizza. The big question is what you will eventually give up if you buy the $100K car instead of something like a $40K car. (And all the associated costs of owning a $100K car.) You may not know what that is yet but it could be things like; 1) It could delay or prevent your being able to buy a house. 2) It could cause your to work longer until you are able to retire. 3) you could run into career or health ...
by Watty
Fri Mar 15, 2024 9:40 pm
Forum: Personal Investments
Topic: Retire in 7 years, getting close enough to plan
Replies: 22
Views: 3201

Re: Retire in 7 years, getting close enough to plan

Unless I missed it your did not say what your expenses will be, what your Social Security will be, what your house is worth, and how large your mortgage and mortgage payment is. You can edit your post using the icon with the pencil on it to add that information so that you might get better responses.
by Watty
Fri Mar 15, 2024 12:12 pm
Forum: Personal Finance (Not Investing)
Topic: Compassion (refund) vs. Compromise vs. Upholding Contract
Replies: 5
Views: 557

Re: Compassion (refund) vs. Compromise vs. Upholding Contract

Your company has also turned down other business opportunities to uphold this agreement. ..... My initial thought is to not offer a refund, but to offer a fee-free reschedule instead with an extended amount of time to do so. If you have turned down the business and allow them to reschedule then you might need to turn down more business in the future when they eventually want you to do the work, or you might not have available time or resources then. A year from now there might also be things like price increases so it could be awkward if they expect you do to work at the same price. Carrying a credit on the books for future work will also complicate your accounting so be sure to also look into that. Carrying a credit for future work sounds...
by Watty
Fri Mar 15, 2024 11:34 am
Forum: Investing - Theory, News & General
Topic: Great news! No more [fixed real estate] agent commission
Replies: 163
Views: 15036

Re: Great news! No more agent commission

Any suggestions about how agents *would* be compensated? Selling agent who lists the house for sale gets paid 3%(ish) by the homeowner. Currently the Buyers agents who takes a buyer around to 30 different houses used to be paid their 3%(ish) at closing by the seller. In the future the closing paperwork would change so that they would then be paid but the buyer. This model would require that the buyer has 20% mortgage to avoid PMI and another 3% to pay the real estate agent unless the PMI rules change. The selling price of the house would also be reduced by 3% so a $100K house would now sell for $97K but the buyer would also need to pay about $3K to their agent as commission. Basically it might not mean a lot except how the paperwork is fil...
by Watty
Fri Mar 15, 2024 10:02 am
Forum: Personal Finance (Not Investing)
Topic: Parents building a new house - how should they pay for it?
Replies: 52
Views: 3961

Re: Parents building a new house - how should they pay for it?

They'd aren't adamant about this, but they would like to complete the purchase of the new home and move in before putting the old home on the market It would be good if they would reconsider this and sell their new house sooner. If they wait until they move into their new house they could be trying to sell their current house in a very bad housing market or in a bad time of year. In a bad housing market it can take six months or longer to sell a house if you are not reducing the price to a distressed price like in a foreclosure. There is a lot going on in the world and country right now which could impact the housing markets so the housing market could be a lot different by the time their new house is ready to move into. If they have been ...
by Watty
Fri Mar 15, 2024 9:22 am
Forum: Personal Investments
Topic: Reducing Large Inherited Holding of a Single Stock
Replies: 18
Views: 1988

Re: Reducing Large Inherited Holding of a Single Stock

Regarding the cost basis, this was a pandemic-era inheritance, and even with the stepped up cost basis, I'm up about $125/share on this holding (AAPL; so yes, I have a lot of exposure via index funds in tax-deferred accounts), with unrealized gains of around $400k.... The smart thing to have done would have been to have sold it when you received the stock. As usual though it is often better to be lucky than smart. :oops: Be cautious about trying to push your luck. It sounds like if you sell the AAPL that you will have to pay around $70K in long term capital gains tax and will end up with more than a million in cash. To keep this in perspective though the AAPL stock will often change my more than that in just a few trading days. If that mil...
by Watty
Thu Mar 14, 2024 10:31 pm
Forum: Personal Finance (Not Investing)
Topic: The best game-changing financial advice you ever received (or "discovered")
Replies: 120
Views: 11079

Re: The best game-changing financial advice you ever received (or "discovered")

For a long time I committed to myself to save half of any raises I got and I was able to pretty much stick with that for a long time. Every time I got a raise I still got more take home pay which felt good and I never missed the additional money that I was saving.
by Watty
Thu Mar 14, 2024 9:52 pm
Forum: Personal Investments
Topic: Portfolio Review 61 yr old female
Replies: 4
Views: 1204

Re: Portfolio Review 61 yr old female

1. How best to simplify? I admit I probably want a little more than a 3 fund portfolio – I do find investing fun and interesting and want a little more control than target date funds but currently I have 20 different funds, plus HSA, I-Bonds, CD ladder, checking account. When I think about rebalancing I get mired in the details of which funds in which accounts. It looks like more than 80% of your money is in retirement accounts. After I retired I also wanted to make my finances easier to manage if I am 80+ years old and in a nursing home. Most of my investments were in retirement accounts so I just moved most of our retirement account money to target date funds to make it easier to manage as I get older. Sometimes people think of target da...
by Watty
Thu Mar 14, 2024 8:59 pm
Forum: Personal Finance (Not Investing)
Topic: How much should I leave to nieces/nephews vs. siblings vs. charity I'm passionate about?
Replies: 58
Views: 4168

Re: How much should I leave to nieces/nephews vs. siblings vs. charity I'm passionate about?

MJS wrote: Thu Mar 14, 2024 8:53 pm Look at slowly converting your tax-deferred accounts - 403, 401's and Traditional IRAs - to a Roth IRA. Leave the funds remaining in tax-deferred to charity (with spouse's permission in most states). That can alleviate taxation issues because the Charities don't have to pay taxes while your spouse & other heirs would.
I am not sure what you are saying.

I am about 99.9% sure that retirement accounts which will be left to a charity should not be converted to a Roth since the charity will not need to pay the taxes on a traditional retirement account.
by Watty
Thu Mar 14, 2024 8:55 pm
Forum: Personal Finance (Not Investing)
Topic: How much should I leave to nieces/nephews vs. siblings vs. charity I'm passionate about?
Replies: 58
Views: 4168

Re: How much should I leave to nieces/nephews vs. siblings vs. charity I'm passionate about?

(we leave most to each other, and we each have an equal chunk in our separate wills that we distribute individually as we see fit). Be sure to ask your lawyer how this will work if one of your survives the other. I know of a situation with a similar size estate where this happened with a retired couple with kids within about five years; 1) Husband dies and leaves everything to wife. 2) Wife is lonely and remarries a widowed man who also has kids when they are in their 70s. 3) They write their wills so that when one of them dies the survivor gets their combined assets, when the second of them dies the remaining money would be split between both sets of kids. 4) Lots of drama and soap opera, talk of possible abuse and wife having early demen...
by Watty
Thu Mar 14, 2024 11:31 am
Forum: Personal Consumer Issues
Topic: 2022 Ford Maverick Megathread...;-)
Replies: 179
Views: 25061

Re: 2022 Ford Maverick Megathread...;-)

TSR wrote: Thu Mar 14, 2024 10:39 am I'll say that this will be a replacement for my wife's 2004 Mazda 3,
If it is running OK now the Mazda 3 will likely sell for a non-trivial amount now.

If you wait to replace it for six months or a year there is a non-zero chance that it will have an expensive problem which might not be worth fixing which could put you in the position of needing to replace it quickly, and not get more for it than a trivial amount that a junkyard might pay your for a non-working 20+ year old car.
by Watty
Thu Mar 14, 2024 8:12 am
Forum: Personal Investments
Topic: Reducing Large Inherited Holding of a Single Stock
Replies: 18
Views: 1988

Re: Reducing Large Inherited Holding of a Single Stock

As others have said you likely got a step up in cost basis to the price of the stock on the day of that person's death unless there is some special situation like a trust. https://www.bogleheads.org/wiki/Step-up_in_basis I'm not crazy about the prospect of paying 15% tax on my gains, but at what point does chasing tax losses become a case of letting the tax tail wag the investment dog? It would not be crazy at all to go on and sell the stock and pay the 15% tax and any state income taxes. The reason is that it is very likely that even if you hold the stock another 20 or 30 years that you will still pay the tax when you eventually sell it. There is even a chance that you could hold it for a long time only to have a tax law change which incre...
by Watty
Thu Mar 14, 2024 7:57 am
Forum: Personal Finance (Not Investing)
Topic: Parents' Financial Situation/Crisis [Heir to estate with more debt than assets]
Replies: 29
Views: 3392

Re: Parents' Financial Situation/Crisis [Heir to estate with more debt than assets]

Be very careful to understand any paperwork that you are asked to sign if they go into a hospital or long term care to make sure that you do not unknowingly take on financial responsibility for them.
by Watty
Wed Mar 13, 2024 10:36 pm
Forum: Personal Investments
Topic: How to use Google 401k for 2-3 fund portfolio
Replies: 63
Views: 6210

Re: Google 401k choices shockingly bad

second_grader wrote: Wed Mar 13, 2024 9:41 pm Better yet, is this documented online somewhere?
Before I retired my 401k plan had some similar options.

Within the plan literature there were charts that gave the phantom funds performance compared to a comparable index for something like 3,5 and 10 years. The difference would usually be the plans expenses or hidden fees.
by Watty
Wed Mar 13, 2024 10:28 pm
Forum: Personal Finance (Not Investing)
Topic: Charles Schwab cannot overnight a replacement debit card
Replies: 87
Views: 6099

Re: Charles Schwab cannot overnight a replacement debit card

sperry8 wrote: Wed Mar 13, 2024 11:06 am Schwab said the fastest they can do for "expedited" service is 3-5 business days.
I would suspect that not quickly sending a new debit card to some random address may be more of a security issue than anything else.
sperry8 wrote: Wed Mar 13, 2024 11:06 am I'm stunned. American Express, Capital One, HSBC, and Chase all overnight the card (or at worst 48 hours if you call late in the day).


You might find that their rules for sending to your home address are a lot different than other addresses.
by Watty
Wed Mar 13, 2024 7:05 pm
Forum: Personal Finance (Not Investing)
Topic: Applying for loans in retirement...
Replies: 21
Views: 2212

Re: Applying for loans in retirement...

I have just put the income number from my prior years tax return since they did not really specify just what they meant by "income". I put "retired" as the occupation. I forget which line on the tax return that was.

I was able to get things like credit cards and a 0% car loan when those were available and they never questioned it.
by Watty
Wed Mar 13, 2024 6:33 pm
Forum: Personal Consumer Issues
Topic: 2022 Ford Maverick Megathread...;-)
Replies: 179
Views: 25061

Re: 2022 Ford Maverick Megathread...;-)

We are pretty sure that we want to purchase a 2024 Ford Maverick Lariat Hybrid. We have found one on a dealer lot that was a delivery that was not accepted by the buyer (per the dealer, the buyer ended up ordering a different vehicle). We have an out-the-door offer at MSRP, which is stated at $38,230 (plus tax/title/etc). With the full appreciation that some people think the "fancy" Maverick is not worth it, my question is whether we should try to negotiate the price below this. There is not a single hybrid Maverick on a lot near us aside from this one, so my inclination is just to go for it at this price. Any thoughts would be appreciated. If it does not have any doc fees or dealer added junk then that would be reasonable if you...
by Watty
Wed Mar 13, 2024 7:44 am
Forum: Personal Finance (Not Investing)
Topic: Paying cash for a house?
Replies: 49
Views: 4625

Re: Paying cash for a house?

This is getting all kinds of mixed up. In the end we have: $1.5M in retirement savings $400k cash savings $100k emergency fund $500k home equity Comparing two scenarios: 1. Buy home for cash, have no mortgage and be left with $1.5M retirement, $100k eFund, $300k cash to figure out how to invest 2. Take 20% mortgage for $480k @ ~6.5% and be left with $1.5M retirement, $100k eFund, $780k cash to figure out how to invest Don't have much other room (or desire) to be "riskier" at this point. There is a third scenario if you do not want to change the risk you are taking which would be to put the $500K in home equity you have now into home equity in the new house and have a relatively small mortgage on the new house. One way of looking ...
by Watty
Tue Mar 12, 2024 9:33 pm
Forum: Personal Consumer Issues
Topic: Where to take Senior on Caribbean vacation?
Replies: 13
Views: 1020

Re: Where to take Senior on Caribbean vacation?

msj16 wrote: Tue Mar 12, 2024 8:26 pm I want to take my 80 year old Mom....
If you can get direct flights somewhere that would be a big plus for me.
by Watty
Tue Mar 12, 2024 5:32 pm
Forum: Personal Finance (Not Investing)
Topic: One spouse retiring earlier than the other?
Replies: 38
Views: 2989

Re: One spouse retiring earlier than the other?

The perceived joys of retirement are way different than reality. I have friends who are retired, all at different ages, but the vast majority of them (the health ones) hate retirement after about a year of getting all those honey do jobs completed. You can only vacation, walk in the park, and play with the grand kids so much. Loss of income, loss of social contacts, loss of a structured something to do. A few rejoice, many regret. Better think long and hard, its a decision that for the most part you cant un-do! Not at all our experience - YMMV Mine either; sound like retirees who have no other life outside of work or not creative after retirement. Right; that’s just sad. After I retired I went out to lunch with the people I used to work wi...
by Watty
Tue Mar 12, 2024 5:29 pm
Forum: Personal Finance (Not Investing)
Topic: One spouse retiring earlier than the other?
Replies: 38
Views: 2989

Re: One spouse retiring earlier than the other?

Since you can retire at any time and don't really need the money then you really do not have a problem.

The reason is that she can retire before you to see how that works and if it does not work well for you then you can retire early too.

With a user name of MrCheapo you might also consider if your work/life balance is right.


If you are prone to be overly frugal and a workaholic then you might consider if part of the reason you married your wife was to help balance out those tendencies in you. It might be the time to follow her lead into retirement.

If possible you might want to try to take a sabbatical this summer while your kid is still living with you so that you could try out retirement.
by Watty
Tue Mar 12, 2024 5:08 pm
Forum: Personal Finance (Not Investing)
Topic: How long after death to transfer assets
Replies: 33
Views: 3081

Re: How long after death to transfer assets

People have posted that when they file a FINRA complaint about a problem with their brokerage that things often get resolved real quick. https://www.finra.org/investors/need-help/file-a-complaint In fairness there may not be anything macalicious going on the broker could be having health problems or something like that which is causing delays. When we were settling my Mom's estate she had a long term financial advisor who was slow and difficult to work with. It turned out that he must have been around 80 and only went into the office about half a day a week to mainly visit and socialize and manage the few accounts that he still had left. I would not call him senial but his best years were far behind him and he was having difficulting follow...
by Watty
Tue Mar 12, 2024 5:02 pm
Forum: Personal Investments
Topic: Help on asset allocation for parents
Replies: 4
Views: 442

Re: Help on asset allocation for parents

One of the target date funds would be a good choice since not only would it have a reasonable asset allocation but it would also help; 1) If something happens to you it will be easier for them or someone else to manage their money. 2) If it does badly then it would be less awkward then if you were helping them invest in a three fund portfolio and taking responsibility for setting the asset allocation. In addition to them you may have siblings who may misunderstand what you are doing with their money. For example if there is a bear market and their investments are down 30% then it would be nice for it to be clear that the investments were not down because of something you did. 3) It will be easier for them to follow what is happening with th...
by Watty
Tue Mar 12, 2024 4:23 pm
Forum: Personal Investments
Topic: Portfolio review request - helping parents in 70s overhaul their investments
Replies: 12
Views: 1448

Re: Portfolio review request - helping parents in 70s overhaul their investments

Plan for taxable account: They currently have a taxable brokerage which represents about 34% of their investments. It holds mainly individual US stocks with some international and bonds as well. Most of the assets in this account are high-basis, and would not make sense to sell/rebalance. Going forward, the plan would be to exclusively build the US stock position (VTI) in this account. A couple of things with this which have not been mentioned. 1) If there are any mutual funds in the taxable account the they should set them to not automatically reinvest any dividends, interest, or capital gains distribution so they will not be buying more of a mutual fund that they may not want for the long term. 2) If they support a church or charity then...
by Watty
Tue Mar 12, 2024 10:47 am
Forum: Personal Consumer Issues
Topic: Greece in August 24
Replies: 31
Views: 2313

Re: Greece in August 24

Aug 2-4: 3 nights in Santorini Aug 5-6: 2 nights in Naxos Aug 7: 1 night in Athens (back from Naxos). Try late evening Acropolis (if not possible try early morning Aug 9th) Aug 8 : 1 Night - 2 day Guided Tour to Delphi and Meteora (Open for better suggestions nearby Athens or to replace with another Island) Aug 9-10 :2 Nights back in Athens Aug 11:Fly back next morning! As I recall the Athens airport is a very long way from the tourist areas of Athens. We took busses or shuttles to and from the airport so we were traveling in traffic. It has been a while so there may be a metro line or train to the airport now which might still have been under construction when we were there. Anyway be sure to research how you will get to the airport. If y...
by Watty
Tue Mar 12, 2024 10:17 am
Forum: Personal Finance (Not Investing)
Topic: Paying cash for a house?
Replies: 49
Views: 4625

Re: Paying cash for a house?

There are lots of talk about how the math would work if the money was invested in a money market instead. The problem is that if the OP does get a mortgage there very little chance that the money would, or should, actually be invested in a money market fund. A more appropriate investment would be to invest the non-emergency fund money in a mixture of stocks and bonds. No matter how you try to rationalize it talking out a loan to invest the money is using leverage which increases the risk. The math is only slightly different than if the OP were to do things like take out a margin loan on their taxable account or a 401k loan to invest the money. When deciding how much risk to take one of the first questions to ask is how much need you you hav...
by Watty
Tue Mar 12, 2024 12:59 am
Forum: Personal Investments
Topic: SS is insufficient, very little savings, what's the best option
Replies: 49
Views: 7791

Re: SS is insufficient, very little savings, what's the best option

If they could purchase a mortgage-free condo apartment with the equity in their current home, that would probably be the single best step they could take to ease their retirement financial strain. +1 If their current house has stairs they may also be able to find a place which would work better as they age. Depending on their local housing market it would also be worth considering selling the house and renting an apartment. They would also need to look into the details in their state but having a paid off condo might also provide some protection for the other spouse if one of them needs to go into long term care. They will also be in bind if the house needs something like a new roof or HVAC system which will eventually happen since those u...
by Watty
Mon Mar 11, 2024 11:26 pm
Forum: Personal Consumer Issues
Topic: Want to leave the California bay area. Where to live?
Replies: 63
Views: 5610

Re: Want to leave the California bay area. Where to live?

I lived in the Bay Area a long time ago. The weather might have been nice but it was crowded and the traffic was horrible too. You are also only in your 30s, and there is no telling what the Bay Area climate will be like 50 years from now. I lived there decades ago and I do not ever recall having problems with wildfire smoke or lots of rain causing Tulare lake to reform in the central valley. It is also easy to ignore the earthquake risk in the Bay Area but it is very real. There are a lot of other factors in deciding where to live and while you like the Bay Area climate it is not nirvana. You said that you make $200K but you did not say if you have millions and can basically retire if you leave the Bay Area. If you still need to work then ...
by Watty
Mon Mar 11, 2024 10:22 pm
Forum: Personal Finance (Not Investing)
Topic: Sell Home or Keep and Rent It
Replies: 11
Views: 1007

Re: Sell Home or Keep and Rent It

I agree with the prior posts that you should sell it. An additional factor to consider is that right now you can likely easily sell it. If you wait a few years then decide to sell it you may end up trying to sell it in a bad housing market. In addition to putting pressure on the price it can take a long time to sell a house in a bad housing market without reducing the priced to a low distressed sale price like a foreclosure or from an estate. One of the reasons I do not own any investment property is that I do not want to deal with it if I am 80 and in a nursing home. Even with a property manager you have to keep an eye on them and occasionally hire a different one. My wife sure as heck does not want to manage a rental if something happens ...
by Watty
Mon Mar 11, 2024 9:43 pm
Forum: Personal Investments
Topic: Should I keep Renting or Sell Rental?
Replies: 7
Views: 829

Re: Should I keep Renting or Sell Rental?

Immafreak wrote: Mon Mar 11, 2024 5:05 pm
If I sell, I estimate:

Condo Sell Estimate: $480,000 (originally purchased at $340,000)
Agent Commission @4.5% (3% buyer, 1.5% Seller): - $21,600
Transfer tax (State + Local) @1.6%: - $7,680
Escrow: - $3,000
Title Insurance: - $1,500

Net Sell: $446,220
Be sure to also figure out capital gains taxes since you will be recapturing the depreciation while it was a rental as well as the actual capital gains.

Even if you only clear $400K though you could put that into a 5% CD can earn $20K a year in interest.
by Watty
Mon Mar 11, 2024 9:31 pm
Forum: Personal Consumer Issues
Topic: Wisdom of cross-country, one-way RV rental (with a cat)
Replies: 37
Views: 3008

Re: Wisdom of cross-country, one-way RV rental (with a cat)

After parking the RV somewhere, we could all get into the minivan for sight-seeing and running errands. That might work when you have the RV is in a campground but if you are driving through some area where it is 90+ degrees and you want to stop for a couple of hours in the middle of the day you may not be able to leave the AC on while you are out site seeing. A few years ago I was in Yellowstone where dogs are not allowed on trails and several times I saw people in the bored looking people hanging out in the parking lot with a dog at some attraction while their family was out seeing something. They could not take the dog on the trail and they also could not leave it in the car. ...recently adopted kitten It isn't like you have had the cat...
by Watty
Mon Mar 11, 2024 9:02 pm
Forum: Personal Finance (Not Investing)
Topic: Annual expense to live upper middle class lifestyle in suburban Midwest
Replies: 20
Views: 2375

Re: Annual expense to live upper middle class lifestyle in suburban Midwest

How much will it cost to live an upper middle class suburban life with two kids in the Midwest? Specifics - - 4 bedroom 2.5 bathroom 2.5k to 3.2k square foot house with yard, [edit: $500k +/- 100k] - new cars every 7 to 10 years or so. Middle trim Honda CRV or Toyota Rav 4. - one annual one week vacation (think theme parks or Florida beach) with flight - two or three extended weekend vacations (driving distance) - shop mostly at Costco - etc You can go into a rabbit hole digging into statistics about what the definition of middle class is but they need to keep in mind that that the median US household income is about $75K. https://www.census.gov/library/publications/2023/demo/p60-279.html They can also google something like "Median ho...
by Watty
Mon Mar 11, 2024 5:08 pm
Forum: Personal Investments
Topic: SS is insufficient, very little savings, what's the best option
Replies: 49
Views: 7791

Re: SS is insufficient, very little savings, what's the best option

stevem54 wrote: Mon Mar 11, 2024 4:56 pm Is her best bet to save the cash in CDs, then buy a SPIA when she finally retires? Or are there better alternatives?
With only $20K something like CDs or a money market fund would be an appropriate investment since that money is basically her emergency fund.

The big thing that is missing from your post are the details about the house. Their situation is a lot different if they owe $100K on a $1.5 million dollar house or they owe $100K on a $150k house.
by Watty
Mon Mar 11, 2024 5:01 pm
Forum: Personal Finance (Not Investing)
Topic: Paying cash for a house?
Replies: 49
Views: 4625

Re: Paying cash for a house?

Ok so let me attempt the rough math game: $600k home - 20% down payment = $480k mortgage @ 6.5% interest is about $30k in interest the first year (using Bankrate calculator). Considering the standard deduction is about $22k (for simplicity) I'd be deducting a net over the standard deduction of about $8k and saving an extra $2800 in taxes (@ 35%). That $480k kept as MM @ 5.3% yields $25k in interest or about $16.5k after taxes. -$30k mortgage interest +$2.8k tax deduction +$16.5k MM interest Net: -$10.7k in the first year. $10.7k/480k = 2.2% effective interest rate vs paying cash for the house? In reality it should be slightly better than that as we'll have more itemized deductions to tack on. I did not follow your numbers. If you have a pa...
by Watty
Mon Mar 11, 2024 2:04 pm
Forum: Personal Finance (Not Investing)
Topic: Paying cash for a house?
Replies: 49
Views: 4625

Re: Paying cash for a house?

If I understand your situation correctly your net worth is $2.5 million including your home equity. If you pay $700K in cash for a house in the midwest then after selling your current home you will still have $250K-$300K in extra cash plus your retirement savings. You expect to have a very high household income in the new area especially for a medium to low cost of living area. Paying cash looks like an easy decision to me. You do not hear about it much but about 40% of homes are owned without a mortgage but people with a paid off house quickly learn to not mention that since it comes across at bragging. I've been at parties where people might be excited about having a low mortgage rate, or moaning about how their current mortgage is higher...
by Watty
Mon Mar 11, 2024 5:47 am
Forum: Personal Finance (Not Investing)
Topic: Feeling stuck with the mortgage
Replies: 30
Views: 2538

Re: Feeling stuck with the mortgage

2. Rent the place out while we collect the mortgage payment and live back home again with the parents. Renting the place out is likely the worst possible option because you would lose the homeowner's capital gains exclusion. Additionally, the general area, lifestyle, and vibes have changed for the worse since we purchased (what hasn’t changed since covid?). ..... 3. Tough it out and stay the full 10 years then sell when the area inevitably explodes with development. In ten years the area could even be worse since it sounds like it is already in decline. One thing to keep in mind is that you said the area is 30 minutes from the big city. If traffic gets worse then in 10 years that area could be 45 to 60 minutes from the big city which might...
by Watty
Mon Mar 11, 2024 5:35 am
Forum: Personal Finance (Not Investing)
Topic: How Much Cash Do You Keep In Your Home?
Replies: 207
Views: 14899

Re: How Much Cash Do You Keep In Your Home?

I always carry enough cash on me to pay for things like a restaurant bill. I have had at least twice when I have been at a restaurant where they were having problems with their credit card system so I was just able to pay cash and leave while other people were waiting for it to be resolved. 2)Some years ago my wife had her wallet stolen in a Florida airport. The nice policemen got her through security for her flight home, which had a connection in Texas, and let her call me on his phone. I immediately canceled all our credit cards, of course. Then I started wondering 'what if she has problems with no ID in Texas?'. I computed how much gas would cost to go get her, and realized that, having canceled all the bank and credit cards, I's have to...
by Watty
Mon Mar 11, 2024 5:13 am
Forum: Personal Finance (Not Investing)
Topic: How to Estimate Taxes on RMDs
Replies: 7
Views: 1125

Re: How to Estimate Taxes on RMDs

Your calculations miss the way your Social Security is taxed.

A much easier way to do your estimates is that if you used tax software to do your tax return you can just make a copy of your latest return to make a dummy tax return then tweak it for your likely situation in the year you will make the RMD.

It will be approximate because it uses the current tax laws and rates but it should be good enough to get a general ideal of how your taxes will look then.