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James1

If your box 13 retirement plan is checked, you would be subject the traditional IRA deduction income limit. If you had already contributed to such an account, you could not take the deduction. My W2 shows I do not have access to a retirement plan, but it looks like the company was wrong and I did h...

James1

The active participant status is based on employee or employer contributions for the tax year. W-2 employee deferrals must deducted with a pay date by 12/31 to count for that year. Your W-2 will reflect your active participant status based on whether your box 13 "retirement plan" checkbox...

James1

I have discreetly asked around and no one has the summary plan document, or even knows what it is. It's not available when an employee logs into their account (only the highlights are available). I don't think I will be able to see it until I talk with HR. Based on everyone's helpful comments and li...

James1

I'm not exactly sure what you're saying. 1. Vanguard has template plan documents and adoption agreements that are not specific to any company. Is this what you're saying when you say Vanguard plan highlights? or; 2. Vanguard has a copy of your specific company plan and it indicates the 1 month/0 ho...

James1

I've verified that the Vangaurd plan highlights do reflect what is written in the plan. Can an employer make requirements outside of the plan documentation? Plan requirements = 1 month and 0 hours worked for eligiblity Employer requirements = 30+ hrs/wk The initial response was that employers get to...

James1

I only work 20 hrs/wk, which is why they have always told me I'm not eligible (the handbook says I would need to work 30 hrs/wk). However, 20 hrs/wk is over 1,000 hrs/yr. Regardless of what the handbook says, it seems like I shouldn't be excluded. Unfortunately, I've looked everywhere and can't find...

James1

What are the implications of a legal review?

James1

For years, my employer has told me I am not eligible to contribute to their 401k. The employee handbook says "those working 30 hours or more a week" are eligible. However, a colleague showed me the company's Vangaurd plan highlights and it lists the following requirements: 0 years of age C...

James1

After doing some quick reading, it looks like a testamentary trust would be the best/simplest solution. If we don't create one, how do the courts decide what happens with the funds for minor children? How do you decide when the trust will give the kids the funds? It appears you can make it as simpl...

James1

After doing some quick reading, it looks like a testamentary trust would be the best/simplest solution. If we don't create one, how do the courts decide what happens with the funds for minor children? How do you decide when the trust will give the kids the funds? It appears you can make it as simple...

James1

We have very simple wills that are ~7 yrs old. They leave 100% to the spouse and if something happens to both of us, everything is split between the 2 kids (and appoints a guardian for them). That was fine when our assets were small, but now they would each inherit mid 6 figures + 1/2 the life insur...

James1

You can also look for different funding options. There are 3 different options I know of. 1. Ask for lessons/memberships instead of presents. Grandparents now pay for 6mo of lessons for their birthday and another 6mo for Christmas. This also helps reduce the number of toys. 2. My kids are homeschool...

James1

Transferwise was cheaper than any bank service when we needed to send money back to the US. It is not available in some countries though. You need a bank account in both countries and transferwise will convert the money from currency/account #1 to currency/account #2 for either a smaller fee or bett...

James1

This thread is hilarious. Make sure to save enough for the divorce that will come when your wife works as a teacher while you sit at home. Not to mention the work ethic that you'll be instilling in your children. Find a different job. The beauty of your position is that it can pay less, so you have...

James1

Schwab was easy to use while we lived overseas, but we used a don't ask don't tell policy. We used my parents address for all our mail (They don't care where you live as long as you have a US address on file). Almost everything can be done online once the account is set up. I don't know if my parent...

James1

My extremely frugal father had cancer in his 50s. He survived and is doing great, but his regret during that time was not having more family time or vacations. My parents now work part time (they enjoy their work and never plan to stop working) so they can travel together and with friends. They also...

James1

I think it really depends on what would be acceptable for your lifestyle when you return. I kept 6 mo of expenses in a mix of USD high yield savings accounts and our overseas bank (in foreign currency). When we returned, this gave us enough money to buy a used car and was even enough for a down paym...

James1

We took a Caribbean cruise with an 18 mo old, a 4 yr old and grandparents. We had a fantastic time and can't wait to do abother one. I think it really depends on the way you like to travel - stroller or baby carrier. If you're dependent on a stroller a cruise would be terrible. If you are comfortabl...

James1

We were in a similar situation in our early 30's. The best advice we received before making the transition was to pretend the soon-to-be SAH income didn't exist. We even had the income deposited in a separate account. See what it is like to live on 1 income and save the rest in retirement accounts a...

James1

livesoft wrote: ↑Mon Dec 18, 2017 8:39 pm VLCAX large-cap index. 100% qualified dividend

But you can set up an automated purchase to buy back VTSAX the next day and avoid the 30-day hold.

How does the automated purchase get around the 30 day hold? Do I need to set it up before I sell?

James1

Vanguard told me they put a 30 day hold on any fund you sell, which would put us in the next tax year. So I have 4 choices 1) Sell VTSAX, stay out info the market for 30 days, and then buy it again. 2) Sell VTSAX and buy another fund to hold long term. 3) Sell VTSAX and buy another fund. Sell this f...

James1

I want to realize some capital gains before the end of the year. This is an unusual tax year and we will probably not want to realize gains again. What's a good alternative to VTSAX to hold long term in taxable? Thanks!

James1

Pezblanco,
Why are stock values at 85%? The initial value would not be taxed at 25%, only the gains.

"True stock values in taxable accounts are viewed as 85% of the actual amount since that is the value you would get if you pulled it out."

James1

Hi All, I'm beginning to question the rule of thumb that stocks should always be in taxable account. I agree that it minimizes your tax rate (in percentage) but thats not what we actually care about, correct? Don't we care about minimizing the total principal we pay to the gov (i.e. tax rate * tax ...

James1

It sounds like you have two competing things going on: you like to move (so maybe change jobs a lot or are self employed?) and now have school age kids. The former is not necessarily conducive to the latter. Kids need stability. Putting all the financial comparisons aside, you should carefully exam...

James1

I want to point out that the 1% rule was coined when average int rates were 6-8% and it will NEVER work for most environments that have nice houses that are growing. Also it was intended as a "should I buy this property for investment" aid NOT a does it make more sense to buy or rent. 1% ...

James1

You can also use your standard deduction space to convert tIRAs to roths and pay no tax on the conversions. +1 You might even consider converting significant tIRA holdings (if you have them) to Roths; up to the 10% or 15% marginal tax rate limit. Take full advantage of this situation. You only want...

James1

You can also use your standard deduction space to convert tIRAs to roths and pay no tax on the conversions.

James1

Finance-MD, Thanks for the insight. It confirms that renting might be the better financial option. We live in a no income state in an area with rapid growth. Although zillow only estimates home values to increase 1-2% for the next year. So maybe the smallest down payment would be the best (if we dec...

James1

I need an outsider's view to help us decide whether to rent or buy! I'm sure we're missing some obvious factors. Some days it seems like renting is better and some days buying seems like the obvious choice. In the last 10 years, we've rented 2 places and bought/sold 2 houses. The longest we've ever ...

James1

We joined a chess group and my 6 & 8 yr olds love it. They have an entire story that explains the board set-up that really engaged the kids. They also have them play using pawns and 1 or 2 pieces at a time to learn how that piece(s) move(s). Even though they can play full games together, playing...

James1

Yes, the foreign income will qualify for the FEIE. Does that matter for HSA contributions or ACA income estimates?

So as long as I have an HSA eligible plan in December, I can contribute the full amount. What would the testing period entail for 2018?

Thanks for your help!

James1

I will be moving back to the states in a month and I need to estimate my income for the year for an ACA health plan. If the plan starts in June, will I be able to contribute the full amount? To estimate my income I planned to do the following: Income from overseas + US income -18k (401k contribution...

James1

That's a good point. If you buy plan directly through an insurer instead of the exchange, you cannot get a subsidy regardless of what your income winds up being. I always thought basing the subsidy on future income was odd. The OP probably has to play with the numbers for their state/zip. It may tu...

James1

"You indicated that health coverage is available through your or your spouse’s job. In general, people who are offered insurance through work are not eligible for financial help through the Health Insurance Marketplace." This is what I was thinking and it puts me in a bind. I can get medi...

James1

Have them set up a schwab account. Their atm is perfect for traveling. There are no transaction fees and they even reimburse atm fees. My relatives use PayPal to send us money while we're overseas (for birthdays and such). This alows everyone's bank information stays private. Here's what we do: 1. R...

James1

When do you plan on spending this $25K? If you plan on spending it soon, then keep it in cash. If longer term, maybe a ST bond fund would work or a muni-fund. You get to decide what "soon" means. I consider it part of my long-term/retirement savings. I don't have plans to spend it anytime...

James1

Are your tax advantaged accounts already filled with bonds? If not, perhaps you can exchange 25K of stocks for bonds in your 401k and use the 25K to buy tax efficient stock funds in taxable.

My tira/401k's are already filled with bonds.

James1

I have 25k in a savings account that is earning 1.05% interest. It is already considered part of my 20% bond/cash allocation. With the drop in bond fund prices, I was thinking of moving it into bonds. However, I would have to move it into a taxable account (there's no more space in my tax advantaged...

James1

OP, I believe ACA is only available to low income families who have "income" that is at least at poverty level. So depending on your income in "early retirement" you may or may not be eligible for ACA subsidies. Remember you can still buy medical insurance without using ACA. [/q...

James1

Not positive on this, but I suspect you aren't eligible for the IRAs and other tax-advantaged accounts we talk about here, especially if you are eligible to save money without paying taxes on it already. If you have income above the foreign earned income exclusion limit, then you would be able to c...

James1

Do you already have an investment account? Or do you have a permanent US address you can use to open one? It might be very difficult to open one while living overseas.

Otherwise, I would do a lot of reading in the "New to Investing? Start Here" area of the site.

James1

We sold our house last year so we could move overseas for a job opportunity (and lots of travel!). We decided to DCA the money into our taxable account over 6 months because I was too chicken to put it in all at once. It is now considered part of our retirement funds and will not be needed for 20+ y...

James1

Why do you think you will have limited access to your accounts? Online: You will want a cell phone with data anywhere you travel and you can use it as a hot spot for your computer. Phone:There are many ways to call companies for free from overseas so it will appear that you are calling from the US (...

James1

We're working on consolidating ours, but we will always have too many.
2 adults and 2 kids
2 joint taxable
5 roth iras (kids too young to manage theirs)
2 tIRAs
1 simple
2 401k
1 sep
1 hsa
2 529
+ misc savings and checking accounts.
16+ accounts to manage!

James1

Don't forget that you will be taxed on your marginal rate. Look at the foreign earned income tax worksheet to understand how it works. Here's a simple example. Foreign income: 175k Other income (dividends, interest, conversions): 25k Gross total income: 200k Standard deduction and exemptions: 30k* 4...

James1

As long as I stay under the standard deduction and exemption amount (we're a family of 4, so approximately 30k), I don't think it matters. Here's how I thought it worked( #'s used are for simplisity)... Foreign income: 99k Other income (dividends, interest, conversions): 30k Gross total income: 129k...

James1

We just moved to Singapore and would like to convert some of our tIRAs to Roths while we are here. We plan to use the foreign earned income exclusion for our income and convert up to our standard deduction + exemptions - any dividends or interest + child tax credits (approximately 30k). We have no i...

James1

My dad had a similar strategy for me. He started contributing to a SEP for me (this was before Roths existed) when I started working around the office at 10. To get around child labor laws (WA), he had to bring paperwork for my principal to sign once a year showing that I wasn't being overworked and...

James1

These blog posts might be helpful for you. They discuss the best income levels for both taxes and the ACA. Other than the premium subsidy, there is a cost sharing reduction subsidy to factor in for households between 100% and 250% of the FPL. http://www.gocurrycracker.com/obamacare-optimization-earl...

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