Search found 17063 matches

by grabiner
Mon May 30, 2016 10:22 pm
Forum: Investing - Help with Personal Investments
Topic: Variable Universal Life Insurance- this one with 50% company match
Replies: 22
Views: 1316

Re: Variable Universal Life Insurance- this one with 50% company match

I can withdraw the money only when I retire or leave the company. If you leave the company then I would doubt that you would be able to roll the money into an IRA like a normal retirement account. Withdrawing the money while you are still working would likely result in very high taxes so that may n...
by grabiner
Mon May 30, 2016 10:18 pm
Forum: Investing - Help with Personal Investments
Topic: How persnickety are you with your rebalance bands?
Replies: 20
Views: 1002

Re: How persnickety are you with your rebalance bands?

I use a 5/25 rule for my rebalancing bands, but I also rebalance naturally with new money. Last week, I needed to make a new taxable stock investment, and since I have more US stock than foreign stock, the new investment went into a foreign stock fund. And every January, when I make my IRA contribut...
by grabiner
Mon May 30, 2016 10:00 pm
Forum: Investing - Help with Personal Investments
Topic: Roth Conversions, Zero Income Years and Tax Brackets
Replies: 31
Views: 1560

Re: Roth Conversions, Zero Income Years and Tax Brackets

The other potential benefit is avoiding part of the phase-in of SS taxation. Once you start taking SS, your marginal tax rate is likely to be 27.75%, even in the 15% bracket; getting money out of your IRA at 25% before this happens is a net gain. (If you are in the 25% bracket, your marginal tax ra...
by grabiner
Mon May 30, 2016 5:32 pm
Forum: Personal Finance (Not Investing)
Topic: NY state income tax rate calculation question
Replies: 6
Views: 386

Re: NY state income tax rate calculation question

I'm confused why the tax schedule on pg 55 doesn't apply for all AGIs, and what the goal of the worksheets really is. If they are designed to change the tax calculation for AGIs above $106.2k, is there an intuitive explanation for how the worksheets work to do that? thanks. The goal is somewhat sim...
by grabiner
Mon May 30, 2016 5:30 pm
Forum: Personal Finance (Not Investing)
Topic: Student loan vs. Invest
Replies: 8
Views: 534

Re: Student loan vs. Invest

I would suggest maxing out your 401(k) and IRA first, and keeping an emergency fund; beyond that, throw everything you can at the student loans. At your income level, you should be able to get rid of the student loans in two or three years, and paying an extra year of interest is a small cost for ge...
by grabiner
Mon May 30, 2016 5:25 pm
Forum: Personal Finance (Not Investing)
Topic: Help: Credit dropped 100 points in a month.
Replies: 8
Views: 1180

Re: Help: Credit dropped 100 points in a month.

You mention that you called to get your credit limit increased. Typically, a hard credit pull will ding you a few points (how much may depend on where you are in the 'brackets' creditors have and your particular scenario), but not 100 (~10 to -15 in my experience). It can also affect you because it...
by grabiner
Mon May 30, 2016 5:18 pm
Forum: Investing - Help with Personal Investments
Topic: Roth Conversions, Zero Income Years and Tax Brackets
Replies: 31
Views: 1560

Re: Roth Conversions, Zero Income Years and Tax Brackets

I am planning to have several zero or near zero income years before taking SS and want to use them to do Roth conversions. While psychological I have difficultly doing anything that would reduce my assets The way to deal with this is to view your Roth IRA as belonging 100% to you, while your tradit...
by grabiner
Mon May 30, 2016 5:06 pm
Forum: Investing - Help with Personal Investments
Topic: Edward Jones or TIaa Creff
Replies: 39
Views: 1436

Re: Edward Jones or TIaa Creff

Another way to hide the load is to make it a back-end load. If you buy $10,000 of an A-share load fund, you have paid a cost because you purchased $9425 of the fund. If you buy the same $10,000 of a B-share loaded fund, your reported balance is still $10,000, but you can't get the $10,000 out; B sha...
by grabiner
Sun May 29, 2016 5:29 pm
Forum: Personal Finance (Not Investing)
Topic: Can we inherit IRAs if not married?
Replies: 20
Views: 1374

Re: Can we inherit IRAs if not married?

The inheritance tax is especially costly on an IRA; as far as I can see, there is no deduction for income in respect of a decedent, in contrast to the estate tax. Thus you pay a tax on money you didn't receive; if you inherit a $100,000 IRA in a 25% tax bracket, you pay $10,000 inheritance tax, and ...
by grabiner
Sun May 29, 2016 5:14 pm
Forum: Investing - Theory, News & General
Topic: Simplegift and Dr. Bernstein
Replies: 20
Views: 2196

Re: Simplegift and Dr. Bernstein

Appreciate the kind words, all. As mentioned in previous posts, if in the late 1990s we hadn’t run across Mr. Bernstein’s online journal, Efficient Frontier , we wouldn’t be enjoying nearly the financial security in retirement that we have today. His early writings convinced us to take the plunge w...
by grabiner
Sun May 29, 2016 4:53 pm
Forum: Investing - Help with Personal Investments
Topic: VFIFX v.s. VWELX v.s. VWINX for roth IRA
Replies: 5
Views: 929

Re: VFIFX v.s. VWELX v.s. VWINX for roth IRA

I am investing in roth IRA for Vanguard Target Retirement 2050 Fund (VFIFX). I have around $14,000 in VFIFX. When I look in this forum, most people are investing in Vanguard Wellesley Income Fund (VWINX) and Vanguard Wellington fund (VWELX). I am 33 years old. Would you please let me know is it bet...
by grabiner
Sun May 29, 2016 4:42 pm
Forum: Investing - Help with Personal Investments
Topic: Bonds in Taxable if Taxable Needs the Safety?
Replies: 16
Views: 1356

Re: Bonds in Taxable if Taxable Needs the Safety?

If you live in NYC, then at current bond yields, holding either NY municipal bonds or Treasury bonds in a taxable account is likely to be more tax-efficient than holding them in a 401(k). (Tax-efficiency isn't the only criterion; if the 401(k) has unusually good bond options, you should hold bonds t...
by grabiner
Sun May 29, 2016 4:39 pm
Forum: Investing - Help with Personal Investments
Topic: lowering capital gains rate
Replies: 13
Views: 827

Re: lowering capital gains rate

You should harvest your losses anyway. If the harvested losses exceed $3K plus any capital gains on the bond funds, the losses will be carried over to next year, so they will offset the bond fund gains even if you wait; you might as well sell now. If the harvested losses are less than $3K, then your...
by grabiner
Sun May 29, 2016 4:35 pm
Forum: Investing - Help with Personal Investments
Topic: 82yr old mother set to inherit large sum
Replies: 12
Views: 1759

Re: 82yr old mother set to inherit large sum

Make sure that someone has power of attorney while she is still competent. And if you put the money in a brokerage, check whether that brokerage has its own power of attorney forms. There have been several reports on the Bogleheads of legally binding powers of attorney not being honored because a fi...
by grabiner
Sun May 29, 2016 4:26 pm
Forum: Investing - Help with Personal Investments
Topic: Emergency Fund in Taxable Investments?
Replies: 30
Views: 1758

Re: Emergency Fund in Taxable Investments?

See Placing cash needs in a tax-advantaged account on the wiki. Your taxable account is big enough that you can use it in emergencies without a separate emergency fund, and presumably without actually selling stock. If your taxable account is all stock and you need $20,000, you can sell $20,000 in t...
by grabiner
Sun May 29, 2016 4:10 pm
Forum: Investing - Theory, News & General
Topic: Tax brackets and investment returns
Replies: 16
Views: 1073

Re: Tax brackets and investment returns

Taxable income is in brackets A, B, C, D, E, F, and G. Each bracket has a tax rate for ordinary income, and a different tax rate for tax-favored income (qualified dividends and long-term capital gains). For example, ordinary income which is in bracket B is taxed at 15%, and tax-favored income is ta...
by grabiner
Sun May 29, 2016 3:58 pm
Forum: Investing - Help with Personal Investments
Topic: Adding a tilt--which international fund to use?
Replies: 65
Views: 3655

Re: Adding a tilt--which international fund to use?

I couldn't stomach 20% of international in EWX. I could stomach 50% of international in VSS though. While I have had about 3% of total portfolio in DGS / EWX for more than 6 years now, that's my minimum amount. I will temporarily buy more in short-term market timing moves and then sell. Check the a...
by grabiner
Sat May 28, 2016 11:14 pm
Forum: Personal Finance (Not Investing)
Topic: "Indexed Annuities: The Big Lie" by Don McDonald
Replies: 26
Views: 2437

Re: "Indexed Annuities: The Big Lie" by Don McDonald

What crazy thing about this discussion is that it seems these annuities are only bought in or near retirement. Yes they are bad investments then. These products are best suited for someone in their 30-40's. With time to grow and no loss of principal, they will easily outperform stocks and bonds for...
by grabiner
Sat May 28, 2016 4:16 pm
Forum: Personal Finance (Not Investing)
Topic: Best way to retire a credit card?
Replies: 17
Views: 2612

Re: Best way to retire a credit card?

If you set up ABP (automatic bill payment) plan with each of your creditor's (CCs, mortgage, utilities, insurance,...), then them getting paid becomes their problem, not yours. This isn't necessarily the case. In July 2011, my Shell Mastercard notified me of a change of terms. The main issue in the...
by grabiner
Sat May 28, 2016 4:04 pm
Forum: Personal Finance (Not Investing)
Topic: When does spending MORE to avoid taxes make sense or does it ever?
Replies: 26
Views: 1778

Re: When does spending MORE to avoid taxes make sense or does it ever?

This makes me wonder about another scenario: if we both go eat, I can deduct 50%, but now can the spouse deduct 50% as well? This would essentially mean we are able to deduct 100% of meals and even entertainment. No, you can each deduct 50% of your own meals if they are legitimate business expenses...
by grabiner
Fri May 27, 2016 10:59 pm
Forum: Personal Finance (Not Investing)
Topic: Tax Gain Harvest for Kid UGTMA
Replies: 9
Views: 455

Re: Tax Gain Harvest for Kid UGTMA

Also, if he is under 24, he will not be eligible for the refundable portion of the American Opportunity Tax Credit unless (again) he is providing more than half his support from his EARNED income. https://www.irs.gov/instructions/i8863/ch02.html However, this can be combined with the kiddie tax; he...
by grabiner
Fri May 27, 2016 6:14 pm
Forum: Investing - Help with Personal Investments
Topic: tax efficiency for bond placement question
Replies: 9
Views: 546

Re: tax efficiency for bond placement question

stlutz wrote:At today's rates, you should generally *prefer* bonds in taxable:

https://thefinancebuff.com/tax-efficien ... olute.html


But not in the OP's 15% bracket, in which stocks are perfectly tax-efficient.
by grabiner
Fri May 27, 2016 5:55 pm
Forum: Personal Finance (Not Investing)
Topic: FICO Score - Can You Explain This
Replies: 24
Views: 2539

Re: FICO Score - Can You Explain This

I never carry a balance past the billing cycle. That doesn't make a difference. As long as you have a balance it will lower your score until you pay it off. The credit reporting agencies get updates daily. Updates are usually only monthly; my credit report shows the balance as of the last statement...
by grabiner
Fri May 27, 2016 5:50 pm
Forum: Investing - Theory, News & General
Topic: Estimating taxes on portfolio in Google Sheets
Replies: 4
Views: 433

Re: Estimating taxes on portfolio in Google Sheets

For REIT Index, you need to look at the nature of the distributions, which Vanguard reports at the end of the year. The dividends are non-qualified, but some of the distribution is a return of capital. And if you hold an international index, add back about 7% of the dividend yield for the foreign ta...
by grabiner
Fri May 27, 2016 5:48 pm
Forum: Investing - Theory, News & General
Topic: Difference between "international" and "ex-US"?
Replies: 10
Views: 1124

Re: Difference between "international" and "ex-US"?

"Ex-US" tends to be used in the name of indexes, particularly those not US based. For example, FTSE has a global index, but it also has an Ex-US index which is of interest to investors who have US holdings in some other investment. Vanguard's fund which tracks that FTSE index keeps the &qu...
by grabiner
Fri May 27, 2016 5:46 pm
Forum: Investing - Theory, News & General
Topic: Tax Free Muni's
Replies: 6
Views: 1019

Re: Tax Free Muni's

It seems to me that paying down your mortgage instead of adding to your bond fund is not without cost. Your lower interest mortgage (reverse bond) is more valuable in a rising interest environment and you will be reducing it. But that is a wash; the bond fund which was your alternative investment w...
by grabiner
Fri May 27, 2016 5:39 pm
Forum: Investing - Theory, News & General
Topic: Tax considerations: Only an Asset Location decision??
Replies: 14
Views: 699

Re: Tax considerations: Only an Asset Location decision??

Tilting to small and value are less tax efficient than TSM. So one may decide to avoid tilting for the sake of taxes, tilt less, or perhaps decide to use tax managed funds for the sake of tilting. Tilting to small is no less tax-efficient. While small-cap stocks have more non-qualified dividends, t...
by grabiner
Fri May 27, 2016 5:24 pm
Forum: Investing - Theory, News & General
Topic: Do you own Vanguard actively managed Equity funds?
Replies: 48
Views: 3412

Re: Do you own Vanguard actively managed Equity funds?

I don't own any now, but I have owned several in the past. I want investments which are inexpensive and which provide the best exposure to the asset class. Index funds usually do this, but low-cost active funds can do this as well in a tax-deferred account ; in a taxable account, they are expensive ...
by grabiner
Fri May 27, 2016 5:19 pm
Forum: Investing - Theory, News & General
Topic: Traditional IRA vs Brokerage Account for Index Fund
Replies: 11
Views: 411

Re: Traditional IRA vs Brokerage Account for Index Fund

I'm a novice in the investing world, but had the following question: If I'm to put money into VFINX and let it sit for the next 30 years, why would I ever consider putting it in a Traditional IRA, other then to lower my taxable income for the current year? That is exactly the reason; it lets you in...
by grabiner
Fri May 27, 2016 5:16 pm
Forum: Investing - Theory, News & General
Topic: Tax brackets and investment returns
Replies: 16
Views: 1073

Re: Tax brackets and investment returns

Here's one way to look at it. Taxable income is in brackets A, B, C, D, E, F, and G. Each bracket has a tax rate for ordinary income, and a different tax rate for tax-favored income (qualified dividends and long-term capital gains). For example, ordinary income which is in bracket B is taxed at 15%,...
by grabiner
Fri May 27, 2016 5:09 pm
Forum: Investing - Help with Personal Investments
Topic: Is there an easy way to get the yield of Vanguard's VIGI?
Replies: 5
Views: 442

Re: Is there an easy way to get the yield of Vanguard's VIGI?

Looks like the 0.33% yield is an estimation based on the 2016 Q1 distribution, multiplied by 4 (since the dividend is paid quarterly). $0.045 / ~$55 * 4 = ~0.327% And for a new fund, that will be much too low an estimate, because the fund has not held its stocks for the whole quarter. If the fund b...
by grabiner
Fri May 27, 2016 5:03 pm
Forum: Investing - Help with Personal Investments
Topic: Transferring from Ed Jones without being Taxed
Replies: 17
Views: 721

Re: Transferring from Ed Jones without being Taxed

Thanks, everyone! If I go to my Ed Jones page and click on Cost Basis, it has a column for "Unrealized Taxable $ Gain/Loss" under which I am in the positive by $9,000. So that means that if I sell these funds to put them in index funds, I'm paying taxes on $9,000? I suppose I could sell h...
by grabiner
Fri May 27, 2016 4:53 pm
Forum: Investing - Help with Personal Investments
Topic: tax efficiency for bond placement question
Replies: 9
Views: 546

Re: tax efficiency for bond placement question

In the 15% tax bracket, it makes sense to hold stocks in your taxable account, because the tax cost on stocks is essentially zero. You pay no tax on qualified dividends, nor on long-term capital gains if you have to sell some stocks. If you have an international stock index, you will pay tax at 15% ...
by grabiner
Fri May 27, 2016 4:48 pm
Forum: Investing - Help with Personal Investments
Topic: Is it worth the additional Expense to try to replicate Total International?
Replies: 20
Views: 1188

Re: Is it worth the additional Expense to try to replicate Total International?

International 20% SS INTL INDEX 0.0977% 5% SS EMRG MKTS INDEX 0.165% <---- :shock: That's a difference of 0.07%, which shouldn't make much difference. You are paying an extra 0.014% on your international allocation to get emerging markets exposure; that is $14 if you have $100,000 in international ...
by grabiner
Fri May 27, 2016 4:41 pm
Forum: Personal Finance (Not Investing)
Topic: FICO Score - Can You Explain This
Replies: 24
Views: 2539

Re: FICO Score - Can You Explain This

In my experience the scores given on CreditKarma or CreditSesame are much higher than the scores reported by mortgage companies or cc companies. Even is the score came from the same credit agency, Transunion, Experian, etc.. This has to do with how each scoring model weighs different factors of you...
by grabiner
Fri May 27, 2016 4:21 pm
Forum: Investing - Help with Personal Investments
Topic: Should I invest my cash in tax-exempt municipal bond funds?
Replies: 18
Views: 2016

Re: Should I invest my cash in tax-exempt municipal bond funds?

Debt: No credit card debt. Car Loan: $28,000. Mortgage $210,000 2.75% interest rate 15 year term and will be paid off on 2028. Pay off that car loan unless it is 0%; the interest is not deductible. You might even pay off the mortgage. It is 1.62% after federal and state tax, with a six-year duratio...
by grabiner
Thu May 26, 2016 9:44 pm
Forum: Personal Finance (Not Investing)
Topic: HSA better than PPO in all scenarios
Replies: 14
Views: 1684

Re: HSA better than PPO in all scenarios

Are those numbers right? $70 for a primary care visit under the PPO is very high; most co-pays are $10-25. The HSA wins out over the HRA, assuming this is a family plan; in addition to the $1000 employer contribution, you can contribute $5650 to the HSA on your own, saving $1413 in tax if you are in...
by grabiner
Thu May 26, 2016 8:59 pm
Forum: Personal Finance (Not Investing)
Topic: Jump in Credit Score
Replies: 4
Views: 565

Re: Jump in Credit Score

I am posting this info because a number of BH threads have asked questions about the intricacies of credit scoring. I have credit cards from Bank of America and Barclay Bank. Both have just informed me that my credit score (FICO 8 from Trans Union, top score 850) has increased in one month from 812...
by grabiner
Thu May 26, 2016 8:29 pm
Forum: Investing - Help with Personal Investments
Topic: Should I invest my cash in tax-exempt municipal bond funds?
Replies: 18
Views: 2016

Re: Should I invest my cash in tax-exempt municipal bond funds?

1. You may want to look very closely at California credit rating before investing in a CA-only fund. From a cursory check it looks like CA has improved recently (from as bad as BBB in 2003 to AA- today), but it is still in the lower tier of state credit ratings. As a resident of NJ (rated A- for ge...
by grabiner
Thu May 26, 2016 8:27 pm
Forum: Investing - Help with Personal Investments
Topic: Sell investment to pay off PMI?
Replies: 5
Views: 395

Re: Sell investment to pay off PMI?

When you can drop PMI depends on the terms of your loan. However, if getting to 20% equity with a prepayment won't allow you to drop PMI (for example, under FHA loan rules), you always have the option of refinancing.
by grabiner
Thu May 26, 2016 8:14 pm
Forum: Investing - Help with Personal Investments
Topic: Funding 529's vs taxable after 401k/IRA's
Replies: 5
Views: 431

Re: Funding 529's vs taxable after 401k/IRA's

Assuming that the 529 is likely to be used for college, it is a better investment than a taxable account, particularly for holding bonds. If it happens not to be used for college, you still get tax deferral of gains, with the 10% penalty. It is inferior if you might need the money in a shorter time,...
by grabiner
Wed May 25, 2016 10:42 pm
Forum: Investing - Help with Personal Investments
Topic: Cashing in $50K of assets - best place to pull from?
Replies: 20
Views: 1604

Re: Cashing in $50K of assets - best place to pull from?

And neither fund is suitable as a core bond holding; both have too much credit risk. Look at what happened to both funds in 2008; the muni fund, which has an average quality of BBB, lost 20%, and the taxable fund, which has an average quality of B, lost 25%. This is not what you want from your bond...
by grabiner
Wed May 25, 2016 10:01 pm
Forum: Personal Finance (Not Investing)
Topic: FICO Score - Can You Explain This
Replies: 24
Views: 2539

Re: FICO Score - Can You Explain This

Aren't true "FICO" scores proprietary and only available from FICO for a fee? FICO has entered into free score arrangements with several credit card issuers, as well as other financial institutions. I've gotten a free Experian II score (the Experian version used for mortgage pulls) from P...
by grabiner
Wed May 25, 2016 9:59 pm
Forum: Personal Finance (Not Investing)
Topic: Cash flow, Tax Deferred Investing, and Student Loan
Replies: 2
Views: 177

Re: Cash flow, Tax Deferred Investing, and Student Loan

Max out your tax-deferred accounts first. Tax-deferred savings is a long-term benefit, and the amount you can contribute is limited. It's probably better to put extra payments to the student loan before investing in a 529, because the interest on the student loan is not deductible given your high in...
by grabiner
Wed May 25, 2016 9:45 pm
Forum: Investing - Help with Personal Investments
Topic: Cashing in $50K of assets - best place to pull from?
Replies: 20
Views: 1604

Re: Cashing in $50K of assets - best place to pull from?

In a 15% tax bracket, if you hold a bond fund in taxable, it should be a taxable bond fund; thus the advisor was correct here. Taxable bonds have higher yields than tax-exempt bonds of the same risk level. It is better to earn a 2% yield and pay 15% taxes, keeping 1.7%, than to earn a 1.5% tax-exem...
by grabiner
Wed May 25, 2016 9:29 pm
Forum: Investing - Help with Personal Investments
Topic: Should my wife startup a 403b just to reduce our taxes...
Replies: 13
Views: 556

Re: Should my wife startup a 403b just to reduce our taxes...

I've looked at the tax tables - if last year - she put away only 9K - that would have bumped us down to 28% - however the subtractor isn't the same as with 33% - so the net savings was only about 3k in taxes - so not huge (54K 33 vs 51K 28). Even without the difference in tax rates, a 403(b) is a g...
by grabiner
Wed May 25, 2016 8:44 pm
Forum: Investing - Help with Personal Investments
Topic: Asset Allocation for HSA
Replies: 6
Views: 582

Re: Asset Allocation for HSA

Since you are using both your HSA and your IRA for retirement savings, treat the HSA as part of your IRA for investment purposes. Any of the Vanguard Admiral funds which fits your investment needs would be a fine choice. You would use the small-cap fund if you want to overweight small-cap, or if you...
by grabiner
Wed May 25, 2016 8:41 pm
Forum: Investing - Help with Personal Investments
Topic: Adding a tilt--which international fund to use?
Replies: 65
Views: 3655

Re: Adding a tilt--which international fund to use?

Vanguard now has International High Dividend Yield Index, also available as an ETF, at 0.30% expenses. This is a reasonable value option, although it is more expensive than other Vanguard funds. I might consider it if the expenses go down in the future, but for now, I don't bother to tilt my interna...
by grabiner
Wed May 25, 2016 8:38 pm
Forum: Investing - Help with Personal Investments
Topic: What funds can you get in Northwestern Mutual?
Replies: 7
Views: 640

Re: What funds can you get in Northwestern Mutual?

Why do you have Northwestern Mutual? Is this a Roth 403(b)/401(k) through your employer? If not, then you have no need to stay with Northwestern Mutual; you can move your Roth to Vanguard, Fidelity, Schwab, or your favorite discount brokerage and buy low-cost funds or ETFs. If it is an employer plan...
by grabiner
Wed May 25, 2016 8:35 pm
Forum: Investing - Help with Personal Investments
Topic: Should my wife startup a 403b just to reduce our taxes...
Replies: 13
Views: 556

Re: Should my wife startup a 403b just to reduce our taxes...

Even if her 403(b) is a bad deal (and not all are), it's almost certainly worthwhile for her. You are in the 33% tax bracket, and you are likely to retire in the 25% tax bracket, so you will pay 25% tax on withdrawals from the 403(b) when you take them later, rather than 33% now. That makes the 403(...

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