Search found 2329 matches

by afan
Sun Jan 22, 2017 4:54 pm
Forum: Personal Finance (Not Investing)
Topic: No home - do I need Umbrella Insurance?
Replies: 19
Views: 2383

Re: No home - do I need Umbrella Insurance?

I assume your SF agent was saying that driving represents almost all of your liability risk, so just get plenty of protection there. That is probably true, but adding umbrella protects you from any other events for which you could be sued. With your income I would shop for all three coverages renter...
by afan
Sun Jan 22, 2017 4:44 pm
Forum: Personal Finance (Not Investing)
Topic: Umbrella insurance questions and help
Replies: 17
Views: 1165

Re: Umbrella insurance questions and help

If and when your liability coverage is exhausted, your net worth is always at risk (largely dependent on state and federal law). So, the simple answer to "how much liability insurance should I buy" is this: Buy at least as much as the dollar amount that a jury and court may award in the e...
by afan
Sun Jan 22, 2017 11:25 am
Forum: Personal Finance (Not Investing)
Topic: Updating our wills
Replies: 5
Views: 862

Re: Updating our wills

Years ago when we started our family an excellent estate planning attorney convinced us to make our gifts to our kids outright rather than in trust. I think he did not believe we were going to be systematic in making the gifts. It was the one piece of bad advice we got. It was simple, but instead of...
by afan
Sat Jan 21, 2017 11:17 am
Forum: Personal Finance (Not Investing)
Topic: Anyone using i-orp as a guide for withdrawals?
Replies: 19
Views: 1651

Re: Anyone using i-orp as a guide for withdrawals?

And that is my concern. If it can return results that seem plausible only to collapse on inspection, how does one know when to trust it? For me the problem was obvious on a careful look. What else was wrong that was not so obvious? In my case, the answer that "the number are too high" was ...
by afan
Fri Jan 20, 2017 5:03 pm
Forum: Investing - Theory, News & General
Topic: Mathematics of international asset allocation
Replies: 43
Views: 3780

Re: Mathematics of international asset allocation

Well the Sharpe ratio just tells you the higher US than international return over that period. But I would not count on small cap portfolios showing lower correlation. After all, these are portfolios of many stocks. Individual small caps likely have more idiosyncratic risk than do individual large c...
by afan
Fri Jan 20, 2017 10:42 am
Forum: Investing - Theory, News & General
Topic: Mathematics of international asset allocation
Replies: 43
Views: 3780

Re: Mathematics of international asset allocation

Besides the extreme portfolios produced by MVO there is the fundamental assumption that volatility is the sole appropriate measure of risk. Since there are ample data proving that investors care about and price higher moments of the return distribution, one should not consider the mean/variance opti...
by afan
Fri Jan 20, 2017 10:30 am
Forum: Personal Finance (Not Investing)
Topic: Anyone using i-orp as a guide for withdrawals?
Replies: 19
Views: 1651

Re: Anyone using i-orp as a guide for withdrawals?

I tried i-orp and found that its recommendations were useless. At first it was exciting to seem to get recommendations for optimizing withdrawal and Roth conversion strategy. but the details were very distressing. I-orp had me making massive Roth conversions into very high tax brackets. As I varied ...
by afan
Thu Jan 19, 2017 6:35 pm
Forum: Personal Finance (Not Investing)
Topic: Whole life or term life insurance
Replies: 5
Views: 748

Re: Whole life or term life insurance

Powermega, Can you explain why someone who thinks they are healthy would benefit from having a checkup before applying for insurance? If the medical underwriting turns something up, then the applicant may need to see a doctor for medical care and the insurance company will either offer higher rates ...
by afan
Thu Jan 19, 2017 6:20 pm
Forum: Investing - Theory, News & General
Topic: Vanguard CEO paid $10-15 million per year
Replies: 4
Views: 1509

Re: Vanguard CEO paid $10-15 million per year

Definitely interesting and a challenge to the independence of the independent boards of directors. On the other hand, I cannot imagine any plausible figure for his salary that would convince me I would be better off with my money somewhere else. Blackrock is different. Fink was a founder and he gets...
by afan
Thu Jan 19, 2017 9:28 am
Forum: Investing - Theory, News & General
Topic: Fama, Lo on optimal portfolios
Replies: 5
Views: 925

Fama, Lo on optimal portfolios

Pardon me if this has been posted before. https://www.youtube.com/watch?v=dj-RO4mh-wA Two famous finance professors, both of whom also have interests in the real world of asset management. In spite of this, the discussion is completely non-technical. The refer to some technical issues, but you do no...
by afan
Wed Jan 18, 2017 3:26 pm
Forum: Investing - Theory, News & General
Topic: Replicating Index with Individual Stocks vs Index Fund
Replies: 27
Views: 2260

Re: Replicating Index with Individual Stocks vs Index Fund

Exactly. If you read even the reference and if you actually go to the papers, you see that they are presenting AVERAGE behavior for LARGE NUMBERS of such portfolios. Even in the extremely brief summary you cited, it includes the critical qualifier that the random portfolios have the same volatility ...
by afan
Wed Jan 18, 2017 12:46 pm
Forum: Personal Finance (Not Investing)
Topic: IRA in Trust?
Replies: 23
Views: 1480

Re: IRA in Trust?

Well, half and half might be the outcome of those considerations. Parents may be sure the adult children will not need the full amount in the IRAs but not comfortable leaving them nothing. It could also reflect planning around estate taxes. Leave enough to get parents up to just below the taxable le...
by afan
Wed Jan 18, 2017 12:38 pm
Forum: Investing - Theory, News & General
Topic: Replicating Index with Individual Stocks vs Index Fund
Replies: 27
Views: 2260

Re: Replicating Index with Individual Stocks vs Index Fund

Eeek! That is not true at all. You are probably thinking of studies that created A LARGE NUMBER of random portfolios and found that, on average, their aggregate performance converges towards the market. An individual portfolio that size would be expected to vary widely from the market. The only time...
by afan
Wed Jan 18, 2017 11:07 am
Forum: Investing - Theory, News & General
Topic: Mathematics of international asset allocation
Replies: 43
Views: 3780

Re: Mathematics of international asset allocation

Keep in mind that the reason the market portfolio is ex ante efficient is that no one has a way to predict a better risk adjusted return from an alternative. Everyone understands that the ex post efficient portfolio will almost always be far from the market. But no one knows what that different port...
by afan
Wed Jan 18, 2017 10:47 am
Forum: Personal Finance (Not Investing)
Topic: IRA in Trust?
Replies: 23
Views: 1480

Re: IRA in Trust?

Of course doctors may want to keep money out of their estates for malpractice protection as well.
by afan
Wed Jan 18, 2017 10:45 am
Forum: Personal Finance (Not Investing)
Topic: IRA in Trust?
Replies: 23
Views: 1480

Re: IRA in Trust?

If the IRA is in the trust, then the trustee could retain the income in the trust, paying it out to the beneficiaries only as the trustee thought appropriate. It would not require a monthly check at all, let alone in that amount. The tax consequences of keeping the money in trust can be exaggerated....
by afan
Tue Jan 17, 2017 11:27 am
Forum: Personal Finance (Not Investing)
Topic: Inheritance and Trusts
Replies: 6
Views: 865

Re: Inheritance and Trusts

For life insurance it is that simple, unless your total estate including the insurance would get up into estate tax territory. For retirement accounts the non-spouse beneficiaries have the option to take the money out over their lifetimes. This is usually better financially if they do not need the m...
by afan
Tue Jan 17, 2017 10:22 am
Forum: Personal Finance (Not Investing)
Topic: Inheritance and Trusts
Replies: 6
Views: 865

Re: Inheritance and Trusts

Retirement assets should name your spouse as primary beneficiary and the trust as secondary. As best I can tell, there is no reason the trust cannot be one created by your will. However, some people on Bogleheads have found some financial firms have a problem with a trust Beneficiary when the trust ...
by afan
Sun Jan 15, 2017 12:38 pm
Forum: Investing - Theory, News & General
Topic: Retired, expenses covered but still growing portfolio, why?
Replies: 46
Views: 4343

Re: Retired, expenses covered but still growing portfolio, why?

Margin of error. Expenses could be much higher than projected. Some pensions fail. Social Security can be cut. Investment returns can go south. Taxes can go up. The larger the gap between what one has and what one needs the lower the risk of coming up short. That risk is never zero but continuing to...
by afan
Sun Jan 15, 2017 9:20 am
Forum: Personal Finance (Not Investing)
Topic: Vanguard on finding a dead person's password
Replies: 86
Views: 6677

Re: Vanguard on finding a dead person's password

Our non-retirement assets are in trusts with each of us as cotrustee for the other. At my incapacity or death my spouse would be legally entitled to manage those accounts and has access to them through my passwords. At some point would notify the financial institutions of my death, but that would no...
by afan
Sun Jan 15, 2017 9:07 am
Forum: Investing - Theory, News & General
Topic: Mathematics of international asset allocation
Replies: 43
Views: 3780

Re: Mathematics of international asset allocation

MVO produces extreme weights whether you use realized returns to find what would have been optimal in retrospect or you input similar values to estimate optimal going forward. In retrospect you know your inputs are correct. For the future you don't know what the realized values will be. One could de...
by afan
Sun Jan 15, 2017 8:37 am
Forum: Investing - Theory, News & General
Topic: Flagship Reps
Replies: 62
Views: 5029

Re: Flafship Reps

I have tried the consultation with a CFP enough out of curiosity to think I have a good sample. Much more knowledgeable sources are available here on Bogleheads.

For free, the CFP access is worth what I am paying for it. I would not pay one basis point in expense ratio for the service.
by afan
Sun Jan 15, 2017 8:33 am
Forum: Investing - Theory, News & General
Topic: Flagship Reps
Replies: 62
Views: 5029

Re: Flafship Reps

I am not sure I have ever spoken with my flagship rep. On the rare occasions that I call I talk to whoever answers the phone. I always get a message that my rep is unavailable. Who cares? I have no idea who it is anyway. But I care about low prices. How about two tiers? Basic level -deal with whoeve...
by afan
Sat Jan 14, 2017 11:36 am
Forum: Personal Finance (Not Investing)
Topic: Best credit card for cash back
Replies: 53
Views: 12354

Re: Best credit card for cash back

Exactly.

Plus the hassle of coordinating which category on which card with my spouse would make it far more trouble than it is worth. A two percent discount on life with no extra hoops is the sweet spot for us.
by afan
Sat Jan 14, 2017 11:11 am
Forum: Personal Finance (Not Investing)
Topic: New vs. Used Car Purchase
Replies: 26
Views: 1751

Re: New vs. Used Car Purchase

Buying new is always a waste of money. There is a big depreciation from brand new to even one year old. This steep drop in value continues, less dramatically, for the next few years. Buying a relatively low mileage car at 3-5 years old seems the most economical. They should still be in good shape wi...
by afan
Fri Jan 13, 2017 5:44 pm
Forum: Personal Finance (Not Investing)
Topic: FAFSA for High Net Worth Parents?
Replies: 70
Views: 5792

Re: FAFSA for High Net Worth Parents?

Many of the small liberal arts colleges compete aggressively for students. They compete of course on academic preparation of the students, extracurriculars, etc. But they also compete to enroll students whose families will pay full price, or close to it. If giving a family that will pay full price a...
by afan
Thu Jan 12, 2017 5:03 pm
Forum: Personal Finance (Not Investing)
Topic: Chase Sapphire Reserve
Replies: 191
Views: 22798

Re: Chase Sapphire Reserve

The cost of Priority Pass Select is included in your $450 annual fee. I don't have the details, but travelling companions and family members are included. Check the fine print. For me, I doubt I will ever use it. I almost always take direct flights, no layovers waiting for a connecting flight. I wou...
by afan
Thu Jan 12, 2017 1:27 pm
Forum: Personal Finance (Not Investing)
Topic: Chase Sapphire Reserve
Replies: 191
Views: 22798

Re: Chase Sapphire Reserve

Since the whole idea was to capture the points bonus, worth more than the cost, we each got our own cards. Adding an authorized user costs money and does not give you a points bonus.. Signing up online was a snap. The approval took a few seconds less time than the couple of minutes spent filling out...
by afan
Tue Jan 10, 2017 6:13 am
Forum: Investing - Theory, News & General
Topic: Fidelity cuts index fund fees (but returns are lower).
Replies: 47
Views: 5101

Re: Fidelity cuts index fund fees (but returns are lower).

At differences of 1 basis point in expense ratio, these other factors become more important. Securities lending-Vanguard has always said it returns all the net income to the fund. I don't think Fidelity does this. This can be more than a basis point itself. Choice of index- some are more efficient t...
by afan
Sun Jan 08, 2017 2:27 pm
Forum: Personal Finance (Not Investing)
Topic: Doctors and retirement
Replies: 67
Views: 7024

Re: Doctors and retirement

Every year, I get an email stating that I've been chosen as an exceptional doctor. For $150, I can purchase a plaque that states that I am exceptional with the ability to display it proudly for my patients to see. It is a small price to pay for me to feel good about myself and to broadcast my excel...
by afan
Sun Jan 08, 2017 2:20 pm
Forum: Personal Finance (Not Investing)
Topic: Doctors and retirement
Replies: 67
Views: 7024

Re: Doctors and retirement

One need not travel to get CME for MOC. Nearly all professional societies offer CME online. If you belong to your specialty societies you have already paid for this. One could get 50 hours per year by investing the time, but never leaving home. Go to one or two national meetings a year and actually ...
by afan
Sun Jan 08, 2017 10:48 am
Forum: Investing - Theory, News & General
Topic: Are Commodities Still a Good Portfolio Diversifier?
Replies: 51
Views: 2555

Re: Are Commodities Still a Good Portfolio Diversifier?

Among the many problems with backtesting commodities is the lack of an obvious standard. There are many candidates, but all are selected retrospectively to make the advertised strategy look good. There is no equivalent of a cap weighted total stock market. The costs of implementation of the various ...
by afan
Sun Jan 08, 2017 10:36 am
Forum: Investing - Theory, News & General
Topic: Large cash allocation in Fidelity's index funds
Replies: 13
Views: 1408

Re: Large cash allocation in Fidelity's index funds

Nice thing about index funds, you know what the returns should be. Compare the historical return to the benchmark index. If they match for return pattern and volatility, beta and r squared are 1, then they are doing their job. The high reported cash position would be a quirk of the securities lendin...
by afan
Sun Jan 08, 2017 10:20 am
Forum: Personal Finance (Not Investing)
Topic: Doctors and retirement
Replies: 67
Views: 7024

Re: Doctors and retirement

I would not be so quick to judge. For the first ten years of my career I was in a four person practice. We worked like h-ll to cover every night and weekend for three weeks and then had a week off. It could be said that we "only practiced nine months a year." I worked harder in those year...
by afan
Sun Jan 08, 2017 10:14 am
Forum: Personal Finance (Not Investing)
Topic: Doctors and retirement
Replies: 67
Views: 7024

Re: Doctors and retirement

How would you know? Medicine is the prototypical asymmetric information field. You have no idea if the doctor was ever any good let alone at presently In emergencies you are stuck. For anything else, there are plenty of sources of information. There are maintenance of certification requirements. On...
by afan
Sun Jan 08, 2017 8:38 am
Forum: Personal Finance (Not Investing)
Topic: Need a will and possibly trust - where do I start?
Replies: 27
Views: 1778

Re: Need a will and possibly trust - where do I start?

To be fair, the OP may have meant "no state estate tax FOR US", due to the size of the estate.
by afan
Sun Jan 08, 2017 8:32 am
Forum: Personal Finance (Not Investing)
Topic: Considering the services of a CFP
Replies: 36
Views: 2171

Re: Considering the services of a CFP

... you could pay Vanguard .3% per year to manage your portfolio. The difference for Vanguard to manage your portfolio versus the CFP is .7%, or more than $5,000 per year on a $750k investment... This. Costs matter. That extra $5,000/year is YOUR MONEY. The advice your CFP is giving seems good all ...
by afan
Sun Jan 08, 2017 8:20 am
Forum: Personal Finance (Not Investing)
Topic: Doctors and retirement
Replies: 67
Views: 7024

Re: Doctors and retirement

...more than half the doctors now work less than six months a year.... I would not want a doctor who practiced six months a year taking my blood pressure, let alone delivering medical care. Either you take it seriously, putting in the time and effort to be excellent, or you should retire. Maybe fli...
by afan
Sat Jan 07, 2017 10:15 pm
Forum: Personal Finance (Not Investing)
Topic: Is a joint account part of your taxable estate?
Replies: 10
Views: 929

Re: Is a joint account part of your taxable estate?

Bypassing probate has nothing to do with being part of your taxable estate.
by afan
Sat Jan 07, 2017 2:45 pm
Forum: Personal Finance (Not Investing)
Topic: Doctors and retirement
Replies: 67
Views: 7024

Re: Doctors and retirement

For many careers and certainly for docs, once you retire for any period of time it will be just about impossible to go back to work if your finances turn south. Once you are out, no longer up to date on skills, you are done. If you are making a good mid to later career income, giving that up is an e...
by afan
Sat Jan 07, 2017 10:11 am
Forum: Personal Finance (Not Investing)
Topic: Doctors and retirement
Replies: 67
Views: 7024

Re: Doctors and retirement

Not everyone views their goal in life as retiring as early as possible, minimizing the total lifetime volume of work. Having the ABILITY to spend 400k per year in retirement does not mean one intends to do that. But it does offer a margin of error for someone who expects to spend 120. Life is tough,...
by afan
Sat Jan 07, 2017 9:59 am
Forum: Personal Finance (Not Investing)
Topic: What monetary value has your education provided you?
Replies: 107
Views: 5321

Re: What monetary value has your education provided you?

Hard to frame the question. What would be the counterfactual income? College was a requirement for my graduate degree. Overall I have done much better than the median high school graduate, if that is the comparison. I went into a high paying career that requires the grad degree, so I cannot attribut...
by afan
Fri Jan 06, 2017 5:58 pm
Forum: Investing - Theory, News & General
Topic: Research Paper Request: Active Manager Performance
Replies: 8
Views: 467

Re: Research Paper Request: Active Manager Performance

If you want a research paper, the best specifically on this topic I think is "Luck versus Skill in the Cross-Section of Mutual Fund Performance" by (Nobel Laureate) Eugene Fama and Kenneth French. THE JOURNAL OF FINANCE • VOL. LXV, NO. 5 • OCTOBER 2010 About as rigorous a treatment as ther...
by afan
Fri Jan 06, 2017 5:41 pm
Forum: Personal Finance (Not Investing)
Topic: Taxes on sign-on bonus check
Replies: 31
Views: 2757

Re: Taxes on sign-on bonus check

If your son is typical college student with little or no income for 2016 and starting a good job halfway through 2017, he will pay lower taxes if this can go on his 2016 return. I suppose if he is in a high tax state now and he will be in a zero state income tax place once he starts working it is PO...
by afan
Fri Jan 06, 2017 5:19 pm
Forum: Personal Finance (Not Investing)
Topic: Need a will and possibly trust - where do I start?
Replies: 27
Views: 1778

Re: Need a will and possibly trust - where do I start?

Bsteiner will tell you that, in most states, there is little to gain from establishing trusts in life, rather than in your will. We have created and funded living trusts since, in addition to somewhat simplifying estate settlement at death, we have found when helping others that the trust is far bet...
by afan
Fri Jan 06, 2017 4:07 pm
Forum: Personal Finance (Not Investing)
Topic: Need a will and possibly trust - where do I start?
Replies: 27
Views: 1778

Re: Need a will and possibly trust - where do I start?

It sounds complicated and expensive, but please force yourself to get on this now. I have an in-law who got divorced several years ago and found it so traumatic that only years later could she get up the courage to deal with laws and lawyers again. She updated her beneficiary designations, I think, ...
by afan
Fri Jan 06, 2017 3:49 pm
Forum: Personal Finance (Not Investing)
Topic: Need a will and possibly trust - where do I start?
Replies: 27
Views: 1778

Re: Need a will and possibly trust - where do I start?

red_uu As you may have gathered, bsteiner is an expert estate planning attorney. As you can see from his reply, there are a lot of things to consider so you want people who know what they are doing. I have done estate planning with a less expensive attorney who did not know what he was doing. That f...
by afan
Fri Jan 06, 2017 10:55 am
Forum: Personal Finance (Not Investing)
Topic: Getting rid of Financial Engines
Replies: 42
Views: 3344

Re: Getting rid of Financial Engines

Maybe they have updated the presentation to give some more information. When I ran it they did not even say it was Monte Carlo, let alone what inputs. If they have revised it, it could be useful now.
by afan
Fri Jan 06, 2017 10:37 am
Forum: Personal Finance (Not Investing)
Topic: Need a will and possibly trust - where do I start?
Replies: 27
Views: 1778

Re: Need a will and possibly trust - where do I start?

If your divorce attorney was good, you might ask for suggestions of estate attorneys who know how to handle divorce issues. Divorce is so common that I would assume any good estate attorney should be well familiar. But there are a lot of attorneys who do estate work who are not really qualified. If ...
by afan
Fri Jan 06, 2017 9:50 am
Forum: Personal Finance (Not Investing)
Topic: Getting rid of Financial Engines
Replies: 42
Views: 3344

Re: Getting rid of Financial Engines

Interesting. An old employer had Financial Engines as a tool to calculate projected retirement assets and income. I did not agree to them doing anything, but filled out the forms to get their estimates. They were comically optimistic. Had me with enormous asset growth. I tried to get answers as to w...

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