Search found 533 matches

by jdilla1107
Fri Jul 07, 2017 6:23 am
Forum: Personal Finance (Not Investing)
Topic: Illinois Partial Year tax increase
Replies: 17
Views: 2079

Illinois Partial Year tax increase

Illinois just passed a tax increase from 3.75% to 4.95% retroactive to July 1st. How does a partial year tax increase even work? What if a capital gain occurred on April 1st? (I had a large one in April) Will it just be a blended rate of (3.75+4.95)/2 since it conveniently is 6 months into 2017? I g...
by jdilla1107
Tue Jun 27, 2017 9:58 pm
Forum: Investing - Theory, News & General
Topic: Taxes on I Series Bonds negate purchasing power protection?
Replies: 12
Views: 1662

Re: Taxes on I Series Bonds negate purchasing power protection?

Taxes on savings bonds are tax deferred, so you could always cash them in a year when you have no other income.

Tax deferral also lowers the real amount you have to pay in taxes. It's inflation working in your favor. $10 in taxes this year is a lot more than $10 in taxes paid in 20 years.
by jdilla1107
Tue Jun 27, 2017 8:54 am
Forum: Investing - Theory, News & General
Topic: Yes, This Is Market Timing: If the CAPE Goes Above 30, Bring on the Larry
Replies: 142
Views: 9883

Re: Yes, This Is Market Timing: If the CAPE Goes Above 30, Bring on the Larry

It's easy to see what is going on with the CAPE by looking at two graphs: Here is the current PE of the sp500: http://www.multpl.com/ Here is the PE10 (cape) http://www.multpl.com/shiller-pe/ The big reason the cape is high is because of the huge PE spike in 2008-2009. Once we get through that perio...
by jdilla1107
Tue Jun 20, 2017 9:26 pm
Forum: Investing - Theory, News & General
Topic: Where to put "leftover" money in an ETF portfolio
Replies: 13
Views: 1373

Re: Where to put "leftover" money in an ETF portfolio

The etfs will pay dividends. Wait for the dividend payments to reinvest a larger amount.
by jdilla1107
Thu May 11, 2017 9:10 pm
Forum: Personal Finance (Not Investing)
Topic: Wells Fargo selling HSA division
Replies: 23
Views: 4276

Re: Wells Fargo selling HSA division

On a related note, anyone else notice the significant under-performance of the WFIOX compared to say the VFINX? smh You aren't comparing performance with distributions included. WFIOX is less tax efficient by throwing off more gains each year which makes a price chart look worse. However, tax effic...
by jdilla1107
Sat Apr 29, 2017 4:12 pm
Forum: Personal Finance (Not Investing)
Topic: Forced to use carryover losses
Replies: 12
Views: 1240

Re: Forced to use carryover losses

I casually called them options, but they are technically restricted stock units. The tax treatment of Restricted Stock Units is not much different than nonqualified options. When Restricted Stock Units become "vested" (meaning you actually own them), the shares of stock are then issued to...
by jdilla1107
Sat Apr 29, 2017 1:05 pm
Forum: Investing - Theory, News & General
Topic: I don't understand the case for EE bonds
Replies: 321
Views: 19911

Re: I don't understand the case for EE bonds

letsgobobby, why is it irrelevant? The OP asked why invest in EE Bonds when stocks are likely to return more than 3.5% over a 20-year period. So it seems that a discussion of the likelihood of stocks doing that is relevant. Kevin There are two questions buried in this one question: 1) Why should I ...
by jdilla1107
Sat Apr 29, 2017 12:33 pm
Forum: Personal Finance (Not Investing)
Topic: Forced to use carryover losses
Replies: 12
Views: 1240

Re: Forced to use carryover losses

I casually called them options, but they are technically restricted stock units.
by jdilla1107
Sat Apr 29, 2017 8:50 am
Forum: Investing - Theory, News & General
Topic: I don't understand the case for EE bonds
Replies: 321
Views: 19911

Re: something odd regarding EE bonds

There are no scenarios of this that don't involve doing something wrong or being able to see the future. It's like saying there are some scenarios where $10 is worth more than $20. There is a large deflationary event. Long bonds significantly increase in market value while stocks crash. You want to...
by jdilla1107
Sat Apr 29, 2017 8:40 am
Forum: Investing - Theory, News & General
Topic: I don't understand the case for EE bonds
Replies: 321
Views: 19911

Re: something odd regarding EE bonds

People on this board keep trying to compare EE bonds to stocks and other investments. They should only be compared to long term bonds. .... If Larry were here, he might say to think about each within the context of the whole portfolio, not in isolation. It's obvious to me that both positions are ri...
by jdilla1107
Sat Apr 29, 2017 8:29 am
Forum: Investing - Theory, News & General
Topic: I don't understand the case for EE bonds
Replies: 321
Views: 19911

Re: something odd regarding EE bonds

There are no scenarios of this that don't involve doing something wrong or being able to see the future. It's like saying there are some scenarios where $10 is worth more than $20. There is a large deflationary event. Long bonds significantly increase in market value while stocks crash. You want to...
by jdilla1107
Sat Apr 29, 2017 8:25 am
Forum: Personal Finance (Not Investing)
Topic: Forced to use carryover losses
Replies: 12
Views: 1240

Re: Forced to use carryover losses

People on here are always going on about how TLH-ing is so great. It looks like it's not so great. Some tax strategies are "fragile" and this needs to be recognized. How is the OP any worse off if the gains get soaked up than if he had done no TLH? Right, it is still much better than not ...
by jdilla1107
Fri Apr 28, 2017 8:36 pm
Forum: Personal Finance (Not Investing)
Topic: Forced to use carryover losses
Replies: 12
Views: 1240

Forced to use carryover losses

I have built up losses from TLHing and use the 3k deduction against income each year. This year my company is going through a sales process and I will get a significant amount of long term capital gain from exercising options. Does the tax code force me to exhaust my carryover losses against the cap...
by jdilla1107
Fri Apr 28, 2017 8:13 pm
Forum: Investing - Theory, News & General
Topic: Five year CD paying more than 10 yr. treasury
Replies: 30
Views: 4529

Re: Five year CD paying more than 10 yr. treasury

I noticed a few minutes ago that five year CD's at Schwab are paying 2.35 percent. The ten year treasury bond is quoted at yield of 2. 30 percent. Why would a five year CD pay more than a 10 year treasury? It cant be liquidity alone ( I don't think). What if in 5 years, interest rates on new 5 year...
by jdilla1107
Fri Apr 28, 2017 7:50 pm
Forum: Investing - Theory, News & General
Topic: I don't understand the case for EE bonds
Replies: 321
Views: 19911

Re: something odd regarding EE bonds

People on this board keep trying to compare EE bonds to stocks and other investments. They should only be compared to long term bonds. They are actually like none of those things, all in very important albeit different ways. On this logic you should compare them to nothing. But the practical invest...
by jdilla1107
Fri Apr 28, 2017 10:01 am
Forum: Investing - Theory, News & General
Topic: I don't understand the case for EE bonds
Replies: 321
Views: 19911

Re: something odd regarding EE bonds

The interest rate risk is not to be underestimated and neither is inflation risk. If inflation averages at the Fed's target then the pre-tax real return of EE bonds would be about 1.5%. People on this board keep trying to compare EE bonds to stocks and other investments. They should only be compare...
by jdilla1107
Fri Apr 28, 2017 9:42 am
Forum: Investing - Theory, News & General
Topic: I don't understand the case for EE bonds
Replies: 321
Views: 19911

Re: something odd regarding EE bonds

The interest rate risk is not to be underestimated and neither is inflation risk. If inflation averages at the Fed's target then the pre-tax real return of EE bonds would be about 1.5%. People on this board keep trying to compare EE bonds to stocks and other investments. They should only be compare...
by jdilla1107
Fri Apr 28, 2017 8:33 am
Forum: Investing - Theory, News & General
Topic: I don't understand the case for EE bonds
Replies: 321
Views: 19911

Re: something odd regarding EE bonds

But it's probably not giant. You buy them with after-tax dollars and you pay taxes on the gain when you redeem them, so it's a much smaller tax break than a 401(k), For rough math, compare 2.69% (20 year treasury) vs 4.77% (3.53% times 1.35 tax rate) over 20 years. This would compare "pre-tax&...
by jdilla1107
Fri Apr 28, 2017 7:40 am
Forum: Investing - Theory, News & General
Topic: I don't understand the case for EE bonds
Replies: 321
Views: 19911

Re: something odd regarding EE bonds

but anyway, $10,000 for 20 years at 2.69% compounded gets you $17,000 instead of $20,000. You are forgetting tax deferral, which makes that gap significantly wider for people who are high tax bracket now and low at retirement. EE bonds expand my tax deferral space somewhat significantly. Try adding...
by jdilla1107
Fri Apr 21, 2017 7:06 pm
Forum: Investing - Theory, News & General
Topic: I don't understand the case for EE bonds
Replies: 321
Views: 19911

Re: I don't understand the case for EE bonds

They allow you to expand your tax deferred space. Only in a fashion similar to non-deductible IRA contributions. The principal is after-tax, so only the earnings are deferred, and that's pretty small in this context. You are assuming something to call it small. I own a lot of EE bonds and am in a h...
by jdilla1107
Fri Apr 21, 2017 6:05 pm
Forum: Investing - Theory, News & General
Topic: I don't understand the case for EE bonds
Replies: 321
Views: 19911

Re: I don't understand the case for EE bonds

You are forgetting about the tax deferral which allows one to do tax arbitrage from high income years to low income years. That will work for some people but current EE bonds only make sense if held exactly 20 years. For a lot of younger people that means cashing them at their peak earnings. They a...
by jdilla1107
Thu Apr 20, 2017 7:48 pm
Forum: Investing - Theory, News & General
Topic: I don't understand the case for EE bonds
Replies: 321
Views: 19911

Re: I don't understand the case for EE bonds

I agree, with the caveat that EEs can make sense for educational uses (tax-free for that use) in a way other bonds cannot. However, 20 year Tennessee Valley Authority zero coupon bonds yield 3.45% (and were yielding a little higher earlier), just 8 basis points less than EE bonds while being liquid...
by jdilla1107
Sun Apr 09, 2017 8:47 pm
Forum: Personal Finance (Not Investing)
Topic: Should I Pay some Estimated Taxes?
Replies: 14
Views: 1528

Re: Should I Pay some Estimated Taxes?

I suggest you look into the "safe harbor" provisions for estimated tax payments. I believe that as long as your withholding payments equal or exceed your federal taxes owed the prior year, there will be no penalty. Of course you might have a big tax bill at tax time, but there should be n...
by jdilla1107
Wed Mar 22, 2017 7:46 pm
Forum: Personal Finance (Not Investing)
Topic: Prepaying property taxes
Replies: 4
Views: 448

Re: Prepaying property taxes

avalpert wrote:Whether this is an option varies from state to state and even county to county - for you this might help: http://www.ssgltd.com/prepayment-of-real-estate-taxes


Wow, thanks!
by jdilla1107
Wed Mar 22, 2017 7:34 pm
Forum: Personal Finance (Not Investing)
Topic: Prepaying property taxes
Replies: 4
Views: 448

Prepaying property taxes

It would save me a lot of money to prepay my 2018 property taxes this year and double up my federal deduction for 2017. Based on following this forum, I have almost assumed this was fine to do. But, I stumbled across this in a past post on bogleheads: II. Deductibility of Prepaid Taxes Section 164(a...
by jdilla1107
Sat Mar 18, 2017 8:23 am
Forum: Investing - Theory, News & General
Topic: Taxable-equivalent yield calculator (Vanguard)
Replies: 1
Views: 315

Re: Taxable-equivalent yield calculator (Vanguard)

Yes, but there are lots of other factors as well. The only right way to do this is to perform what-if scenarios with tax software. I discovered that I have nearly a 50% marginal rate by doing this.
by jdilla1107
Sun Mar 05, 2017 9:25 am
Forum: Personal Finance (Not Investing)
Topic: Pay ibonds taxes on interest now or later?
Replies: 23
Views: 1753

Re: Pay ibonds interest now or later?

You cannot pay the taxes until you sell the bonds. This is wrong. See here: https://www.treasurydirect.gov/indiv/research/indepth/ibonds/res_ibonds_itaxconsider.htm You have an option to pay taxes every year if you want. The only reason to I can think of paying as you go would be if you'll be in a ...
by jdilla1107
Sat Feb 04, 2017 6:44 pm
Forum: Investing - Theory, News & General
Topic: turbotax- underpayment penalty
Replies: 10
Views: 1775

Re: turbotax- underpayment penalty

As long as you paid 90% of what you owe this year or 100% (110% if high income) of what you paid last year, there is no penalty.

And turbotax tells you if there is a penalty.
by jdilla1107
Sun Jan 15, 2017 1:48 pm
Forum: Investing - Theory, News & General
Topic: institutional herding in corporate bonds and liquidity issues-beware ETFs in this space
Replies: 59
Views: 4042

Re: institutional herding in corporate bonds and liquidity issues-beware ETFs in this space

Here's where it hurts the investor. Your example is missing that in a liquidity crunch, the next option to purchase a bond literally may not exist (for a lower quality bond) or may not exist at a price you want to pay (high premium for an AAA or treasury. So you end up paying a higher price for qua...
by jdilla1107
Sat Jan 14, 2017 4:43 pm
Forum: Investing - Theory, News & General
Topic: institutional herding in corporate bonds and liquidity issues-beware ETFs in this space
Replies: 59
Views: 4042

Re: institutional herding in corporate bonds and liquidity issues-beware ETFs in this space

I hear this over and over from smart people and I just don't understand it. Can anyone produce an example of how this would happen in a significant way? Say a fund has two investors who buy in on the same day. The fund buys two bonds for $100. Now we have a liquidity crisis and the bonds market val...
by jdilla1107
Sat Jan 14, 2017 11:08 am
Forum: Investing - Theory, News & General
Topic: institutional herding in corporate bonds and liquidity issues-beware ETFs in this space
Replies: 59
Views: 4042

Re: institutional herding in corporate bonds and liquidity issues-beware ETFs in this space

It seems that a spike in redemptions could cause mutual funds to sell their bonds during a liquidity squeeze, hurting all investors in the fund- even those who don't sell. I hear this over and over from smart people and I just don't understand it. Can anyone produce an example of how this would hap...
by jdilla1107
Sat Jan 07, 2017 11:26 pm
Forum: Investing - Theory, News & General
Topic: "Yield surge: Remember the real role of bonds"
Replies: 50
Views: 6687

Re: "Yield surge: Remember the real role of bonds"

Treasury yields are almost exactly at the same place they were this time last year.

Stay the course.
by jdilla1107
Sat Dec 31, 2016 10:24 am
Forum: Investing - Help with Personal Investments
Topic: Paying myself a salary for investment and tax management?
Replies: 71
Views: 4854

Re: Paying myself a salary for investment and tax management?

At this asset level, you should have a trust. Do you already have this? You can pay yourself as the trustee of the trust. You should talk to a CPA and a lawyer. Getting internet advice on a 8 figure portfolio is not a good idea.
by jdilla1107
Sat Dec 31, 2016 9:50 am
Forum: Investing - Theory, News & General
Topic: When to choose investing over loan repayment?
Replies: 17
Views: 1894

Re: When to choose investing over loan repayment?

I have a mortgage at an effective after-tax rate of 2.75%, which is currently above TBM yields, so I am toying with whether I should simply pay it down as much as I should in lieu of investing in bonds. From a pure cash flow perspective, having loans of a higher rate than your bonds means you are l...
by jdilla1107
Sat Dec 24, 2016 9:24 am
Forum: Investing - Theory, News & General
Topic: If day trading works, shouldn't there be successful companies with proven track record?
Replies: 20
Views: 2182

Re: If day trading works ,,shouldn't there be successful companies with proven track record?

Nowadays, successful companies exist. Once they discover the "secret sauce", they keep it to themselves. Look up Renaissance Technologies and its history. So there are people out there who knows how to beat the market consistently?! I thought Mr.Bogle said that he knows no one who can do ...
by jdilla1107
Wed Dec 14, 2016 11:16 pm
Forum: Personal Finance (Not Investing)
Topic: pushing sale to next year for lower cap gains rate?
Replies: 2
Views: 555

Re: pushing sale to next year for lower cap gains rate?

Note that if you stay in the 15% tax bracket next year, long term gains are taxed at 0%. So, if you are married and have no other regular income you could take at least $75,000 at 0%. (I say at least, because that doesnt count any deductions) There can be a lot of variables and it's usually best to ...
by jdilla1107
Thu Dec 01, 2016 8:58 pm
Forum: Personal Consumer Issues
Topic: Credit Card bonuses
Replies: 19
Views: 2941

Re: Credit Card bonuses

I just got a $500 bonus from the chase sapphire preferred and another $500 for my wife. $1000 for doing almost nothing differently was pretty nice. I'm new to this. How many different cards per year can you do this on and not have your credit score drop significantly? I hear stories of people "...
by jdilla1107
Sun Nov 27, 2016 12:24 pm
Forum: Personal Consumer Issues
Topic: Credit Card bonuses
Replies: 19
Views: 2941

Credit Card bonuses

I just got a $500 bonus from the chase sapphire preferred and another $500 for my wife. $1000 for doing almost nothing differently was pretty nice. I'm new to this. How many different cards per year can you do this on and not have your credit score drop significantly? I hear stories of people "...
by jdilla1107
Sat Nov 12, 2016 11:06 pm
Forum: Personal Consumer Issues
Topic: USAA 2.5% Cash Back Credit Card
Replies: 171
Views: 29627

Re: USAA 2.5% Cash Back Credit Card

Hulk wrote:Do you pay taxes on cash back rewards? Just curious.


No, you do not pay taxes. It is considered a reimbursement of fees.
by jdilla1107
Wed Sep 21, 2016 9:54 pm
Forum: Investing - Theory, News & General
Topic: "Uncle Sam Pays Almost Twice The Yield On Treasurys--If You Know Where To Look
Replies: 85
Views: 13088

Re: "Uncle Sam Pays Almost Twice The Yield On Treasurys--If You Know Where To Look

Many people are missing the fact that they are tax deferred which is as good as tax free for some people. For people able to do tax arbitrage effectively this is extremely valuable. I have a marginal tax rate now of 40%+ and will plan to pay almost nothing on the interest in 20 years when I am not w...
by jdilla1107
Sun Sep 18, 2016 11:35 am
Forum: Investing - Theory, News & General
Topic: Disappointing News Wells Fargo
Replies: 111
Views: 10958

Re: Disappointing News Wells Fargo

Nothing at WF has cost me any fees (yet), but it's become obvious that they really base their core metrics on "number of accounts open". Its a trap, they get you in easy, but punish you hard if you try to leave. I actually don't mind it this way as opposed to annual fees or other hidden f...
by jdilla1107
Sun Sep 18, 2016 11:23 am
Forum: Investing - Theory, News & General
Topic: Disappointing News Wells Fargo
Replies: 111
Views: 10958

Re: Disappointing News Wells Fargo

When I was younger, I opened a simple checking account at Wells Fargo. The person who opened my account really pushed to open a savings account to get higher rates for short term savings. Then they really pushed me to open a second savings account for even higher rates for longer term money. They to...
by jdilla1107
Sat Sep 10, 2016 8:35 am
Forum: Personal Finance (Not Investing)
Topic: Wells Fargo
Replies: 93
Views: 16090

Re: Wells Fargo

I have the PMA account, 100 free trades per year brokerage account deal. Currently, I have one brokerage account. Am I allowed to open an additional brokerage account and "share" the 100 free trades? Anyone know? I have 5 brokerage accounts (roth, trad for wife and I plus a taxable) with ...
by jdilla1107
Sun Apr 17, 2016 9:22 pm
Forum: Personal Consumer Issues
Topic: Better than amazon??
Replies: 86
Views: 14516

Re: Better than amazon??

So I decided to do little shopping comparison using items that I thought people might commonly shop for online. I didn't cherry pic items or discard anything that didn't fit my preconceptions. I didn't include shipping cost, as all of these vendors offer some sort of free shipping deal, although Wa...
by jdilla1107
Fri Apr 15, 2016 10:47 pm
Forum: Personal Finance (Not Investing)
Topic: Tax Planning for 2016
Replies: 8
Views: 1962

Re: Tax Planning for 2016

Are you an employee or own your own business? Some suggestions: - Look into donor advised funds. You can essentially prepay your charitable giving and get an immediate tax break. This is a great strategy for tax arbitrage, if you don't expect your income to remain this high for a long time. - Use mu...
by jdilla1107
Tue Apr 05, 2016 10:19 pm
Forum: Investing - Help with Personal Investments
Topic: How to invest HSA with Wells Fargo?
Replies: 8
Views: 1061

Re: How to invest HSA with Wells Fargo?

I invest in wells fargo hsa. WFIOX (an sp500 index fund) is the only fund i invest in because all of the other options have significantly higher fees. This fund is currently .25%, which is pretty good.
by jdilla1107
Wed Mar 30, 2016 7:01 pm
Forum: Personal Finance (Not Investing)
Topic: Real Estate License for your own personal RE
Replies: 15
Views: 1680

Re: Real Estate License for your own personal RE

My opinion is that a selling agent adds real value and a buying agent adds almost none. The selling agent has a national network of potential buyers to market your house to. Doing this with a sign in your yard will be less effective than what they can do. Also, note that if you put your house in the...
by jdilla1107
Wed Mar 30, 2016 6:21 pm
Forum: Investing - Theory, News & General
Topic: What if your money in Vanguard disappeared one day??
Replies: 44
Views: 7247

Re: What if your money in Vanguard disappeared one day??

There is a similar government organization called SIPC that insures securities:

http://www.sipc.org/for-investors/what-sipc-protects
by jdilla1107
Sun Mar 20, 2016 9:08 am
Forum: Personal Finance (Not Investing)
Topic: Buying a new car
Replies: 56
Views: 8345

Re: Buying a new car

I do everything by email. - Decide on the exact car you want. - Research the invoice price. - Email a dealer outside of your town and say that you will pay cash, have no trade-in (these are both important to their profit) and you would like to pay 100-500 over invoice. Pick one of those number depen...

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