Search found 424 matches

by dpbsmith
Wed May 07, 2014 7:23 pm
Forum: Investing - Theory, News & General
Topic: SEC Investing Alert: Bitcoin and Other Virtual Currency
Replies: 10
Views: 1950

Re: SEC Investing Alert: Bitcoin and Other Virtual Currency

There was a lot of press coverage in February when a bitcoin ATM machine was installed at South Station (commuter rail) in Boston. I've been in South Station three times in the last couple of weeks and it isn't there any more. An indicator of some kind?
by dpbsmith
Sun May 04, 2014 6:21 pm
Forum: Personal Consumer Issues
Topic: Philly/Boston in May: Recommendations Please
Replies: 26
Views: 2723

Re: Philly/Boston in May: Recommendations Please

In my opinion you do not need to rent a car to "see" Boston, if you are comfortable walking distances of 1-2 miles. It depends on what specific things you want to see, of course, and where you are staying. Boston is not only walkable, and with a pretty good public transit system, it is also a miserable place to drive. U.S.S. Constitution and the Freedom Trail. The $3 ferry ride from Long Wharf to the Charlestown Navy Yard where the Constitution is--great way to start the Freedom Trail. Boston Museum of Science, a good big-city science museum, good planetarium, IMAX Dome movies, a somewhat eclectic set of exhibits. I love the Theater of Electricity. The Museum of Fine Arts. Prudential Skywalk--simple and satisfying, just a great ob...
by dpbsmith
Wed Apr 30, 2014 1:43 pm
Forum: Investing - Theory, News & General
Topic: Efficiently collecting CPI-adjusted SPIA quotes
Replies: 14
Views: 3453

Re: Efficiently collecting CPI-adjusted SPIA quotes

bhsince87 wrote:Just curious, but does anyone know if CPI adjusted SPIA's could go down if the CPI goes down?
No general rule, these details are specific to the policy. And can change from one year to another. The one we have specify that the payouts do NOT go down if the CPI goes down, but do not increase until the CPI catches up to its previous value. That is, it is indexed to the CPI index--the thing that was about 10 in 1913 and is about 230 now. As opposed to ratcheting up, increasing by the annual inflation rate in years when it is positive but not decreasing when it is negative.
by dpbsmith
Fri Apr 25, 2014 5:40 pm
Forum: Personal Consumer Issues
Topic: What Book Are You Currently Reading? Part V
Replies: 3372
Views: 1560747

Re: What Book Are You Currently Reading? Part V

Just finished Barrie Wigmore's Morgenthal & Co. The Story of an Important Investment Bank 1972-2010, recommended by William J. Bernstein. I found it entertaining and readable, and would recommend it to anyone interested in the subject matter--but be ready to forgive some awkward writing here and there.
by dpbsmith
Mon Apr 21, 2014 3:53 pm
Forum: Investing - Theory, News & General
Topic: SPIA - what do guarantee associations cover?
Replies: 23
Views: 3649

Re: SPIA - what do guarantee associations cover?

There may not be any answer. When I was trying to pin down another detail, I spoke to someone in a state insurance division. He pulled me up short every time I referred to the protection as "insurance," and was very particular that it was not insurance (NOLHGA calls it a "safety net.") He kept emphasizing the phrase "case by case," and said that every insolvency is dealt with case by case, and that--if I understood him correctly--what the laws provide is a sort of framework that defines what's considered to be fair to the policyholder. I don't think the protection is worthless, but everything about it screams it was written by the industry for the industry's convenience, and that avoids tying them down to anyth...
by dpbsmith
Tue Jan 28, 2014 2:20 pm
Forum: Personal Consumer Issues
Topic: "Disposable" cell phone for four weeks in Canada?
Replies: 5
Views: 1045

"Disposable" cell phone for four weeks in Canada?

This summer we'll be on a road trip with no strictly defined itinerary that will be taking us in and out of Canada. We're told our current phones will not work in Canada. If so, what's the easy, obvious thing, to use for about four weeks in Canada? In the U.S. we'd go to a Walmart or CVS and find TracFones and NET10's hanging on pegs. Is it about the same in Canada? Are there border tourist shops selling them?
by dpbsmith
Tue Jan 14, 2014 7:43 pm
Forum: Personal Investments
Topic: Helping parents decide whether to buy SPIA
Replies: 46
Views: 3627

Re: Helping parents decide whether to buy SPIA

Anybody that uses the term "salesman" and "SPIA" together has no idea of what a Single Preimum Immediate Annuity actually is (I/we do, since we have one - and no salesman was required 99% of annuity sales are done through licensed insurance agents (many of whom are also brokers, CFP's, etc). Only 1% of annuity sales are done directly with the insurance company. That's why it's important for the vast majority of the public to understand what they are dealing with. Either way, a SPIA is an expensive insurance product. If after learning about all of the negatives you still like them then go RIGHT AHEAD and invest in one! I really think you don't understand the differences between a variable annuity (bad), and some of its u...
by dpbsmith
Fri Jan 03, 2014 6:36 am
Forum: Personal Finance (Not Investing)
Topic: Question about fixed annuity from Vanguard
Replies: 1
Views: 568

Re: Question about fixed annuity from Vanguard

...If over the next 12 months interest rates rise and I put the same data in the calculator( 68 year old male needs $600 per month income) on 1/2/2015 will the annuity be less expensive than the quote I received today? If this is so, is this interest rate timing where you want to buy at peak interest rates? I don't know just how closely and real-world annuity prices follow interest rates or whether there is a lag, but, definitely, yes. I'm not an actuary and don't know the details but broadly speaking annuity prices are based on the current yield curve--what it would cost to buy a package of individual bonds that will pay out interest and principal in such a way as to make the contracted for payments. CONCEPTUALLY, to support a group of 68...
by dpbsmith
Mon Dec 09, 2013 1:02 pm
Forum: Personal Investments
Topic: Balanced Fund Choice for Lump Sum
Replies: 5
Views: 650

Re: Balanced Fund Choice for Lump Sum

If you mean an annuity that you buy yourself from any insurer you wish, there are a few insurers that offer inflation-indexed annuities whose payouts are directly tied to CPI-U just like Social Security (OK, technically Social Security uses CPI-W). And there are many that offer annuities whose payouts, instead of being level, increase by a stated percentage each year. Vanguard is one channel for getting quotations and purchasing them; you need a Vanguard account and you need to go through some rigmarole to open a no-cost online account with their partner, Income Solutions. When you've done that, you can get actual purchasable price quotations. You get the actual quotations immediately online. If you don't say you want them to contact you, t...
by dpbsmith
Tue Nov 26, 2013 12:31 pm
Forum: Personal Investments
Topic: Annuity Payments if I move
Replies: 4
Views: 587

Re: Annuity Payments if I move

When you move, you will be subject to the laws of the state to which you move. So the appropriate place to try to contact would be the state guaranty association of the state to which you are moving. They are typically a little hard to reach and not really equipped to handle consumer calls but it should be do-able. Barring that, try the state insurance division of the state you are moving to. Find out the contact information for your state guaranty association from the NOLHGA website at http:www.nolhga.com . Be careful, type it EXACTLY, there are typosquatters on inaccurate versions of that name! The paperwork on the annuities I own--the actual annuity contract--says someplace in so many words where the insurance company is domiciled (and t...
by dpbsmith
Mon Nov 04, 2013 5:15 pm
Forum: Investing - Theory, News & General
Topic: Vanguard Takes Fund Crown From Pimco
Replies: 16
Views: 4334

Re: Vanguard Takes Fund Crown From Pimco

Jack Bogle will probably be pleased. A few years ago he said something about Total Stock being the largest fund, if you included all share classes, and he seemed annoyed when one of his assistants had to correct him--it was, at the time, "only" the largest stock fund.
by dpbsmith
Wed Oct 30, 2013 7:55 am
Forum: Investing - Theory, News & General
Topic: The Decumulation Phase
Replies: 138
Views: 70829

Re: The Decumulation Phase

JOtar wrote:I would love to come to Philadelphia in Oct 2014 and meet everyone.
I'd not only like to meet Mr. Otar but I'd be interested in hearing his views, either in a presentation or as part of an expert's panel.
by dpbsmith
Thu Oct 24, 2013 5:25 pm
Forum: Personal Finance (Not Investing)
Topic: Want to have kids, scared of the financial consequences
Replies: 95
Views: 9540

Re: Want to have kids, scared of the financial consequences

"It sometimes happens, even in the best of families, that a baby is born. This is not necessarily cause for alarm. The important thing is to keep your wits about you and borrow some money."

--Elinor Goulding Smith, The Complete Book of Absolutely Perfect Baby and Child Care, 1957.
by dpbsmith
Sun Oct 20, 2013 6:49 pm
Forum: Investing - Theory, News & General
Topic: Share with us: What was the best thing you learned at BH12
Replies: 35
Views: 4240

Re: Share with us: What was the best thing you learned at B

At the Vanguard meeting, one of the presenters made some joking references that made it clear that he, at least, must be a pretty regular reader of the Bogleheads forum.
by dpbsmith
Sun Oct 20, 2013 5:22 pm
Forum: Investing - Theory, News & General
Topic: Talk me out of a commodity futures allocation
Replies: 80
Views: 7979

Re: Talk me out of a commodity futures allocation

Gus Sauter had a neat chart at Bogleheads showing the differences between fund returns and investor returns for various asset categories. What I found interesting was that the simple dumb Boglehead assets, stocks and bonds, had investor returns that were very close to the fund returns. All the "weird zoo animals," including commodity futures, had investor returns that were as much as 4% lower than fund returns. I thought that was a pretty good argument agianst them.
by dpbsmith
Sun Oct 20, 2013 8:49 am
Forum: Investing - Theory, News & General
Topic: Longleaf Funds
Replies: 14
Views: 5387

Re: Longleaf Funds

At Bogleheads they asked the panel to confess their biggest investing mistake. Christine Benz said that she personally had invested in one of the longleaf funds, I forget which, in the belief that longleaf was doing everything right, hadn't paid much attention, and was recently surprised to find that over the time period she held the fund it had underperformed.
by dpbsmith
Mon Oct 14, 2013 4:25 pm
Forum: US Chapters
Topic: On my way to the Bogleheads reunion!
Replies: 29
Views: 4168

Re: On my way to the Bogleheads reunion!

Image

I updated my LifeTicker... how about you?
by dpbsmith
Tue Oct 08, 2013 11:33 am
Forum: Investing - Theory, News & General
Topic: SPIA - Interest vs Principle ?
Replies: 14
Views: 1300

Re: SPIA - Interest vs Principle ?

Too bad BRK Direct shut down because their quotations always showed their interest rate assumptions. A year ago I believe it was in the ballpark of 2%.

Fidelity once published a chart that shows the general idea very nicely.

Image
by dpbsmith
Sun Sep 29, 2013 4:42 pm
Forum: Personal Finance (Not Investing)
Topic: couple of ppaca(obamacare questions)
Replies: 39
Views: 3689

Re: couple of ppaca(obamacare questions)

Fifty different states will do fifty different things, some will do it better than others, with fifty of them and some of them hostile to the whole idea some will make a botch of it... but one thing to keep in mind is that Massachusetts has being doing something very similar for at least five years now so it's not impossibly difficult. I don't know precisely how smooth it was, but there have been no glaring headlines about large-scale horror stories. I did not buy insurance through the connector the first day it was available, but I was using the website to get premiums to budget the three-year gap between COBRA and Medicare fairly soon after it started.
by dpbsmith
Sun Sep 29, 2013 11:40 am
Forum: Personal Investments
Topic: Post-Retirement Investing
Replies: 17
Views: 2760

Re: Post-Retirement Investing

1) A lot of the book, The Bogleheads' Guide to Retirement Planning , concerns post-retirement issues. 2) Unfortunately, there are many--dozens?--of financial products called "annuities" of various types. The word "annuity" just means annual (or regular) payments. There are two I would like to define for you. The simplest of all "life annuities," and one that may be relevant to your family member's situation, is called a single premium immediate annuity (SPIA). Like term insurance, it is a very simple and pure form of insurance product, and insurance agents dislike selling it because they get much higher commissions for other products. An SPIA is a tool that deals with longevity risk, period. It is insurance. It...
by dpbsmith
Fri Sep 27, 2013 4:31 pm
Forum: Investing - Theory, News & General
Topic: Deferred Immediate Annuities
Replies: 23
Views: 3206

Re: Deferred Immediate Annuities

One thing I have looked at is nominal (constant dollars) vs. real (inflation-protected) SPIAs. In my opinion, real SPIAs are not worth the cost. I think this is incorrect. People are disappointed because they were somehow hoping or expecting that they could get inflation protection for some tiny token increase in premium. But even the roughest back-of-the-envelope calculations will show that if you assume, say, 3% inflation and, let us say, 25 years of payouts, an inflation-adjusted annuity is going to have to pay out a total of almost half again as much as a level-payout annuity, so it shouldn't be surprising that it might cost half again as much. Online quotations showed me that inflation-adjusted annuities have premiums that are very co...
by dpbsmith
Fri Sep 13, 2013 6:25 am
Forum: Personal Finance (Not Investing)
Topic: Three common cases of bad financial advice
Replies: 26
Views: 4160

Re: Three common cases of bad financial advice

I don't think the immediate annuity advice is on track. It is making the mistake of considering insurance as an investment instead of as a risk management tool. If you analyze insurance as an investment, you would never buy any insurance at all; it is always advantageous to the insurance company and disadvantageous to you. I pay my homeowner's insurance premiums every year, and it is my sincere hope that this will all be totally wasted and that I will never make a single claim, lose all of the money I send them in premiums, and get a -100% return on this investment. The decision-making process that needs to be made with insurance is, first, is there a good fit--is this a risk I really need to manage, and does the insurance target the risk I...
by dpbsmith
Thu Sep 05, 2013 1:37 pm
Forum: Personal Consumer Issues
Topic: Boston this weekend
Replies: 25
Views: 2819

Re: Boston this weekend

GREAT location for exploring without car. GREAT walking neighborhood. The weather should be nice Saturday and tolerable Sunday. I don't know whether the shopping venues are particularly "unique" but once you cross one street you enter a complex that includes several major shopping malls/plazas connected by enclosed glass walkways. More to your wife's taste might be the dozens of clothing shops that line Newbury Street, a short walk away. You are within moderate walking distance of the Public Garden and Boston Common, and very close to the Back Bay station on the Orange Line. I would like to mention one museum-y thing, not as being necessarily wonderful, but as being completely UNIQUE. The Mapparium in the Christian Science complex...
by dpbsmith
Thu Aug 29, 2013 11:12 am
Forum: Investing - Theory, News & General
Topic: Effect of dividend & interest rates on safe withdrawal rate
Replies: 12
Views: 1337

Re: Effect of dividend & interest rates on safe withdrawal r

If you want 4%-then-COLAed and you don't believe that's a safe withdrawal rate from an investment portfolio, then log on to Vanguard and get a quote from Income Solutions: Annuity type: Joint & Survivor (spouse) Life Only Annuity Annuitant's date of birth: 4/1/1948 Annuitant's gender: M Joint annuitant's date of birth: 4/1/1948 Joint annuitant's gender: F Survivor benefit percent: 100% Annuitant's state of residence: PA Annuitant will be depositing: $120,000.00 Source of funds: Qualified (pre-tax) Assets Annuitant's spouse is the sole beneficiary: Yes Annuitant will be receiving inflation adjusted quotes linked to changes in the CPI-U Index and separate quotes with a fixed annual increase of 3% Quotes will be based on an estimated depos...
by dpbsmith
Wed Aug 28, 2013 5:10 pm
Forum: Personal Consumer Issues
Topic: In Boston what to do?
Replies: 36
Views: 4330

Re: In Boston what to do?

Downtown Boston and Back Bay are very walkable. Random suggestions. I was going to put in a vote for the Boston Public Library, just a twenty-minute visit, but teenaged kids might not like it. I like just walking across the Longfellow Bridge on a nice day. Take the red line to Kendall Square, walk across the bridge, on the Boston side look for one of the Hubway bike rental stations, rent bikes, ride up and down the Esplanade (linear park on the Boston side of the Charles). If you see the Hubway stations, you just use a credit card, you don't need any special membership. They are intended for commuting, short rides, don't need to be returned to the station where they were checked out, do NOT try to keep them out for more than an hour or so, ...
by dpbsmith
Wed Aug 21, 2013 4:28 pm
Forum: Personal Investments
Topic: immediate annuities
Replies: 14
Views: 1507

Re: immediate annuities

Frugal Al wrote:
ndchamp wrote:But, the OP mentioned committing $100K....not 100% of assets. :moneybag
Yes. Still, a good explanation by dpbsmith.
My mistake. Sorry
by dpbsmith
Wed Aug 21, 2013 5:36 am
Forum: Personal Investments
Topic: immediate annuities
Replies: 14
Views: 1507

Re: immediate annuities

The monthly payouts that are made from an immediate annuity can be higher than the earnings of any comparably safe investments. However, one has to distinguish between the payouts , and actual investment returns . Like any insurance product, the insurance company makes money . Also, like any insurance product, in order to be sure claims are paid, regulators require the insurance companies to invest very conservatively. Thus, the actual investment returns of an immediate annuity are low; they resemble the investment returns of high-grade bonds, less what the insurance company takes as profit. Some estimates suggest that the "load" on an annuity, the percentage of the premium that the insurance company keeps for its own profit, is s...
by dpbsmith
Sun Aug 18, 2013 6:24 pm
Forum: Personal Consumer Issues
Topic: Lasik at Age 56
Replies: 6
Views: 1625

Re: Lasik at Age 56

With regard to "another pair of $600 glasses." A few months ago I bought a pair of Superfocus glasses, which also cost about $600. These are single-vision glasses with an adjustable focus . The outer lenses are made to your prescription, and behind them is a "focus module" with a tiny wheel that lets you dial in any add from 0 up to almost 3. So, you have to reach up and turn the wheel to change focus but you can focus perfectly at any distance. The technology requires the lenses to be perfectly round, but rather to my surprise that seems to be fashionable. (The wheel forces fluid into a lens that has a flexible membrane making it bulge more or less.) I don't want to link to a commercial site. All I will say is: I really...
by dpbsmith
Wed Aug 14, 2013 5:54 pm
Forum: Investing - Theory, News & General
Topic: Forbes Article: Why Don't Retirees Buy Annuities?
Replies: 66
Views: 12369

Re: Forbes Article: Why Don't Retirees Buy Annuities?

I dont know what the percentages are but in some states its total regardless if over a few companies. I'm pretty sure in Oregon it's total, but as long as both companies didn't fail simultaneously it seems that you would be safe. You can check this sort of detail at http://www.nolhga.com . Top menu, "facts and figures," "GA Law Summaries," "Law Summaries By Provision," "Benefit Limits" is a good place to start. This link might work directly: https://www.nolhga.com/factsandfigures/main.cfm/location/lawdetail/docid/8 Search for the world "aggregate." There is usually an aggregate cap, an overall limit on the grand total amount the guaranty association is responsible for protecting. But one ca...
by dpbsmith
Sat Aug 10, 2013 9:57 am
Forum: Personal Investments
Topic: Using Managed Payout funds to mimic Pension Annuity payment
Replies: 19
Views: 3002

Re: Using Managed Payout funds to mimic Pension Annuity paym

Your fear of SPIA'S is understandable but they have never left any insured amount unpaid. 1) They are not "insured." The NOLHGA is very careful not to use that word. They call it a "safety net." I was once on the phone with someone at the state division of insurance trying to understand more about my state's guaranty association and she corrected me each and every time I accidentally referred to guaranty association protection as "insurance." The guaranty association laws (different in every state) do not say that the guaranty association needs to do any particular thing; it has very broad authority on what to do, and decides how to handle on each insolvency on a case-by-case basis. And it does not guarantee t...
by dpbsmith
Sun Aug 04, 2013 7:54 am
Forum: Personal Finance (Not Investing)
Topic: Actual recent purchasers of SPIA's
Replies: 12
Views: 1456

Re: Actual recent purchasers of SPIA's

What is the difference between the Vanguard website and http://www.immediateannuitites.com? Are they just two different channels to the same sets of providers? Or are they different in some way? The only similarity is that they are both retail channels offering choices of products from a number of providers. immediateannuities.com is the web name for something called the Hersh Stern agency. The Vanguard website is a portal to something called Heuler Income Solutions. I don't understand the insurance business, but you usually can't buy the products direct from the insurers, you need to go through some kind of agent. It's sort of like buying digital cameras from two different retail chains--you might expect to find several brands at both, bu...
by dpbsmith
Sat Aug 03, 2013 10:44 am
Forum: Personal Finance (Not Investing)
Topic: Actual recent purchasers of SPIA's
Replies: 12
Views: 1456

Re: Actual recent purchasers of SPIA's

Not the past couple of years, but within the last five or so. I got a package of quotations from immediateannuities.com (the Hersh Stern agency), I got online quotations from the two places I could find them (BRK Direct--now defunct--and Vanguard), I got quotations by calling Fidelity and Elm Income Group, reviewed TIAA's "lifetime contract" conversion procedures in writing and talking to a TIAA rep, and called SBLI (regional firm with a reputation for low cost term insurance) several independent agents. The independent agents were hopeless, a TOTAL waste of time. They were only interested in dissing SPIA and pushing variable annuities, and the two that insisted that "they'd be glad to sell me an SPIA but didn't recommend the...
by dpbsmith
Tue Jul 23, 2013 6:10 pm
Forum: Personal Investments
Topic: First Post - First Question is for my Dad
Replies: 14
Views: 10726

Re: First Post - First Question is for my Dad

NOT A RECOMMENDATION, not even a suggestion, just something they might want to look at if they don't already know that such things exist and if the idea seems appealing to them. If there is a charity that really appeals to them, one to which they are seriously committed and are really interested in giving some financial help to, they might LOOK INTO whether the charity offer a "charitable gift annuity." A lot of universities, charities, etc. do offer them. You make a charitable donation and in return you get a meaningful regular income payment for as long as you live. There are some weird questions about safety because in many states charitable gift annuities are not legally insurance and not subject to insurance regulations. The ...
by dpbsmith
Mon Jul 15, 2013 4:40 pm
Forum: Personal Investments
Topic: Helping parents decide whether to buy SPIA
Replies: 46
Views: 3627

Re: Helping parents decide whether to buy SPIA

Weighing in Favor/Weighing Against Lower retirement savings /Higher retirement savings Can you explain this point? If hypothetically someone had so much money that they need less than 1% per year in spending, would an SPIA ever be advised? An SPIA is insurance. The insured-against event is running out of money due to living much longer than one's average life expectancy. Usually, a frugal person will avoid buying insurance for a risk he can easily afford to take on himself. The insurance company makes money on the deal--probably on the very rough order of 5-10% for an SPIA, including agents' commissions. Why would you want to give it to them unless you get something back that's worth that much to you? Having an insurer pay a bill you can e...
by dpbsmith
Mon Jul 15, 2013 2:22 pm
Forum: Personal Investments
Topic: Helping parents decide whether to buy SPIA
Replies: 46
Views: 3627

Re: Helping parents decide whether to buy SPIA

I'm trying to help my parents decide whether to annuitize their retirement assets with an SPIA when they retire in 5-10 years. They have enough assets that they should be fine on a 3% withdrawal rate from their portfolio. What questions should one ask to decide whether they need an annuity? The most important decision factor involves YOU . There are some variations on the SPIA details, but fundamentally, you and your parents need to be crystal clear on the following concept: overall, statistically, what an SPIA will give them more money while they are alive, and reduce the likely size of your inheritance. Without an SPIA, a retiree needs to budget for the longest likely time they will need money--in the case of a 65-year-old couple, one ro...
by dpbsmith
Wed Jun 19, 2013 7:31 am
Forum: Personal Consumer Issues
Topic: Buying New Glasses; Looking for Suggestions on What to Buy
Replies: 20
Views: 8622

Re: Buying New Glasses; Looking for Suggestions on What to B

Plugging superfocus once more if you need more distances than bifocals; they are such an interesting alternative. Different and unique spectrum of tradeoffs, you must evaluate the optical quality for yourself. I've noticed no chromatic aberration at all (but of course the fact that the lenses are smallish reduces that problem). The flexible membrane does not form a perfectly shaped lens surface; perfectly smooth, none of the subtle waviness I've seen in traditional lenses, but at the closer settings there is noticeable optical imperfection in the form of images stretching out a bit toward the edges. But the big plus is that you can always get the focus adjusted exactly right and not just in one tiny little spot. And the world doesn't twist ...
by dpbsmith
Mon Jun 17, 2013 7:59 am
Forum: Personal Consumer Issues
Topic: Buying New Glasses; Looking for Suggestions on What to Buy
Replies: 20
Views: 8622

Re: Buying New Glasses; Looking for Suggestions on What to B

I love my new adjustable-focus "Superfocus" glasses but I've only had them a month, still "honeymooning." The highest praise I can give them is that they are exactly what I expected them to be, no surprises yet. Company's website--I won't link, too spammy, Google them, very complete information including pricing. If you are picky about getting things in focus and dislike your progressives, and if they sound interesting based on the web description, I'd seriously consider taking them up on their one-month trial. Optical quality in the sense of sharpness is excellent in the center at all distance settings. It is excellent over the whole field in the distance setting. In the close setting it is excellent in the center, but ...
by dpbsmith
Wed Apr 10, 2013 8:17 am
Forum: Personal Investments
Topic: Annuities for guaranteed income?
Replies: 13
Views: 1570

Re: Annuities for guaranteed income?

An interesting article AGAINST annuities comes from Forbes magazine. It does make some interesting points. http://www.forbes.com/sites/davidmarotta/2012/08/27/the-false-promises-of-annuities-and-annuity-calculators/ I think it is a bad and very slanted article. The author exposes himself as either dishonest or grossly uninformed by the line immediate annuities are not indexed for inflation. He goes on for four paragraphs saying that "The only real guarantee of an annuity is a diminishing lifestyle because of inflation....Annuities offer too much income to spend early in retirement only to keep that number constant and offer too little later in life." It is possible that he doesn't know about the existence of inflation-indexed SPI...
by dpbsmith
Wed Apr 10, 2013 6:41 am
Forum: Personal Investments
Topic: Annuities for guaranteed income?
Replies: 13
Views: 1570

Re: Annuities for guaranteed income?

A detailed article is in chapter 7 of "The Bogleheads' Guide to Retirement Planning." The word "annuity" covers as many different kinds of thing as the word "investment." Larry Swedroe and Jared Kizer's book, The Only Guide to Alternative Investments You Will Ever Need: The Good, the Flawed, the Bad, and the Ugly classifies fixed annuities, aka SPIAs (single premium immediate annuities) under "good," variable annuities under "flawed," and equity indexed annuities under "ugly." Warning: the insurance industry, IMHO in response to well-deserved bad press about equity indexed annuities, is now referring to them as "fixed index annuities." In my opinion SPIAs are a potentiall...
by dpbsmith
Tue Mar 26, 2013 1:38 pm
Forum: Investing - Theory, News & General
Topic: Places to find inflation-adjusted lifetime SPIA quotes
Replies: 7
Views: 2571

Re: Places to find inflation-adjusted lifetime SPIA quotes

Things may have changed since I last looked into it, but NON-automated quotations on inflation-adjusted annuities from The Principal were available from Fidelity and from Elm Annuity Group, www.elmannuity.com. The Principal is one that is included in the Income Solutions quotations through Vanguard, but the set of available options offered might vary from one agency to another... and the price might vary slightly, which would be interesting to know. Lincoln Financial Group offers what seems to be an inflation-indexed SPIA: https://www.lfg.com/LincolnPageServer?LFGPage=/lfg/acc/fprod/ann/immann/index.html&LFGContentID=/lfg/acf/prd/irp/siia/payopt Quotations aren't available online, I don't know how you'd get them--presumably by calling a...
by dpbsmith
Thu Mar 21, 2013 5:15 am
Forum: Personal Investments
Topic: Annuities:Fixed Income or Inflation Protection
Replies: 44
Views: 6062

Re: Annuities:Fixed Income or Inflation Protection

You might want to read Chapter 7 of The Bogleheads' Guide to Retirement Planning , which has a section on CGA's. There are a couple of things you and your friend need to know about CGAs. One is that virtually all charities that offer them have the same choices and rates, so among other things you don't need to waste time shopping around. (Yes, it's price-fixing and Congress passed a special law to allow it). You and your friend should spend a little time on the ACGA website. Your friend can rest assured that a CGA really does help the charity in a very substantial way--it's almost like donating half the premium amount. There are two tricky things. First, there have been some senior frauds involving fake CGAs so do check out the charity, I'm...
by dpbsmith
Tue Mar 19, 2013 11:54 am
Forum: Investing - Theory, News & General
Topic: what is the chance of SPIA failure in a great depression II?
Replies: 27
Views: 3211

Re: what is the chance of SPIA failure in a great depression

To get an idea of the size of mortality credits, compare payouts with and without a guaranteed period (aka "term certain.") During the guaranteed period, say ten years, payments are made unconditionally. If some other policyholder with the same policy dies early, payments continue to be made to their heirs, and do not become available to help make payments to anyone else. So, there are no mortality credits. During that ten-year period, the annuity really is what some critics mistakenly believe them to be--the insurance company is just investing your premium conservatively, doling your own premium and its earnings back to you, and charging you for doing something you could do for yourself. It is functioning as a pure investment--a ...
by dpbsmith
Thu Mar 07, 2013 5:14 pm
Forum: Personal Consumer Issues
Topic: Deleted
Replies: 12
Views: 807

Re: A question about editing Wikipedia

I've edited Wikipedia, topic caught my eye. Any reason you're not mentioning the name of the article? Not trying to push, especially if there are privacy issues (e.g. connecting your Wikipedia username with your Bogleheads username).
by dpbsmith
Sat Feb 23, 2013 7:34 pm
Forum: Personal Investments
Topic: Tell Me About Immediate Annuities
Replies: 19
Views: 1775

Re: Tell Me About Immediate Annuities

1) Chapter 7 of The Bogleheads' Guide to Retirement Planning is my attempt to explain single-premium immediate annuities. 2) There are many things you need to understand and many pros and cons. But let me just address the basic question: "is it possible to get returns close to this amount. My wife is 66 and I am 70, self employed all our life and needing more income off our savings. Just want to know more about them and what the possible returns would be." As others have noted, this is not interest or an investment return. There's a website called BRK DIrect EZ-Quote . The ONLY reason I'm using it is that you can get a quick online quotation from them with real numbers in it. I'm not suggesting them as a place to actually buy an a...
by dpbsmith
Wed Feb 13, 2013 5:56 am
Forum: Personal Finance (Not Investing)
Topic: Fixed Income Life Annuity Question
Replies: 17
Views: 1838

Re: Fixed Income Life Annuity Question

As I understand it, you have a 401(k), and a one-time opportunity to convert it to a fixed income life annuity provided by your employer. The essentials here are not that the annuity "would essentially double what I would receive versus withdrawing 4%/yr. if I continue investing like I am." Be careful. That proposition is simply the general life-annuity-versus-portfolio-withdrawals thing. Be aware that the traditional 4% is neither "4% of whatever the portfolio value is" nor is it "4% of the initial portfolio value," it is "4% of the initial portfolio the first year, and adjusted upward for cost-of-living in subsequent years." So, good, bad, safe, or unsafe, the 4% withdrawal rate assumes inflation ad...
by dpbsmith
Wed Feb 06, 2013 10:13 am
Forum: Personal Investments
Topic: vanguard immediate fixed annuities
Replies: 25
Views: 2938

Re: vanguard immediate fixed annuities

Just a quibble. Buying an annuity through Vanguard is probably a very good idea, but it is not an annuity from Vanguard as Vanguard is not an insurance company, as far as I know. One would want to check what insurance company is actually issuing the annuity. It's all fairly clear when you go through the process. Vanguard is a business partner with a business named "Hueler Investment Services, Inc." which operates a program called Income Solutions. Vanguard's only real role in the process is offering access to their website, cutting the deal with Hueler that determines how much money each of them makes, and arranging so that you can pay Hueler directly out of your Vanguard account. Hueler's quotations identify the insurers quite c...
by dpbsmith
Wed Feb 06, 2013 6:34 am
Forum: Personal Investments
Topic: vanguard immediate fixed annuities
Replies: 25
Views: 2938

Re: vanguard immediate fixed annuities

P.S. You'll see language to the effect that the annuity payouts are subject to "the claims-paying ability of" the insurer. If you go the annuity route, you want to educate yourself on this aspect. In addition to the financial strength ratings the insurers tell you about, you need to understand the protection provided by your state guaranty association. Insurance is state-regulated and everything about it varies from state to state. Find out the details for your own state at http://www.nohlga.org "State associations, click here", "Choose your state association," "Go," and click on "FAQs" in the menu bar. READ IT THROUGH. It is NOT government-backed insurance, like FDIC deposit insurance, but ...
by dpbsmith
Wed Feb 06, 2013 6:13 am
Forum: Personal Investments
Topic: vanguard immediate fixed annuities
Replies: 25
Views: 2938

Re: vanguard immediate fixed annuities

I personally thought an immediate fixed annuity was suitable for my situation and got one through Vanguard. I wrote a chapter of the "Bogleheads' Guide to Retirement Planning" laying out the pros and cons. Barry Barnitz has done a great job on the Wiki article. There's surprisingly little overlap! I think immediate fixed annuities are very useful tools for any retiree whose savings are a little stretched . One doesn't dare draw down an investment portfolio aggressively because you don't know how long it needs to last, so in order to be safe you end up with unspent money at the end. What a fixed annuity does is to make it possible for a retiree to safely spend more on themselves while leaving less to their heirs. Assuming that an i...
by dpbsmith
Sat Dec 29, 2012 6:18 am
Forum: Personal Finance (Not Investing)
Topic: longevity annuity
Replies: 40
Views: 5421

Re: longevity annuity

How about this link https://www.metlife.com/assets/investments/products/annuities/Longevity-income-guarantee.pdf ? Probably. I can't quite tell if that is a product in itself, or whether it is a rider that can only be obtained in conjunction with a variable annuity... or perhaps only in conjunction with a MetLife investment account of some kind. Has anyone encountered a fixed annuity that's described simply as a "guarantee?" One thing that's clear: there is no reference to any sort of inflation adjustments, CPI-indexed or otherwise. You don't need to worry about inflation protection. Just make an estimate of what inflation will be; use 2.5% to 3.2%.... But, what if inflation is much higher than predicted? Well, we're talking abou...
by dpbsmith
Fri Dec 28, 2012 4:59 pm
Forum: Personal Finance (Not Investing)
Topic: longevity annuity
Replies: 40
Views: 5421

Re: longevity annuity

I can't seem to find the actual product description at MetLife's website... can you give us a link to it? Here's the metlife link - quite the domain name eh? http://www.longevityannuity.org/ That is not MetLife's website. I don't know what it is. And it has no product details but that ad-like short blurb, and an invitation to tell 'em your birth date and phone number and so forth. It does not actually tell us the name of the product. Their MetLife link just goes straight to the general MetLife website for individuals. If I search on the phrase "advanced-life delayed annuity" I get "Your search did not match any document." longevityannuity.org, whomever or whatever it may be, does not want you to learn anything about his...