Search found 9068 matches

by KlangFool
Tue Jul 17, 2018 2:52 pm
Forum: Investing - Theory, News & General
Topic: Why age is not how to determine risk tolerance
Replies: 12
Views: 862

Re: Why age is not how to determine risk tolerance

B) 100/0 is a lousy AA in term of risk-adjusted return. So, it is the wrong AA at any age. You can't eat risk-adjusted return. If you're not willing to use leverage, and you're willing to wait 30 years, the 100/0 AA will wind up with a higher balance even at 5th percentile stock market returns. Thr...
by KlangFool
Tue Jul 17, 2018 11:32 am
Forum: Investing - Theory, News & General
Topic: Why age is not how to determine risk tolerance
Replies: 12
Views: 862

Re: Why age is not how to determine risk tolerance

OP, A) It is not safe to assume continuous full-employment until retirement age. A fair amount of people lose their jobs in a recession. B) 100/0 is a lousy AA in term of risk-adjusted return. So, it is the wrong AA at any age. C) There is a simpler formula. The current portfolio value as a multiple...
by KlangFool
Tue Jul 17, 2018 11:10 am
Forum: Investing - Theory, News & General
Topic: Balanced Funds and Sequence of Return Risk
Replies: 38
Views: 1991

Re: Balanced Funds and Sequence of Return Risk

randomguy, <<do you spend your bucket and go to 100/0>> Under this system, you will spend your bucket and go down to 100/0. <<Imagine you have a 10 year flat market coming up. >> If that happened, in year 5 or earlier than that, the person should drastically lower his/her expense. KlangFool P.S.: T...
by KlangFool
Tue Jul 17, 2018 9:07 am
Forum: Investing - Theory, News & General
Topic: Balanced Funds and Sequence of Return Risk
Replies: 38
Views: 1991

Re: Balanced Funds and Sequence of Return Risk

The portfolio is 900K and 60/40. That meant 540K of stock and 360K of the bond. The stock drops 50% and down to 270K. Under this bucket system, the minimum is 300K of the bond. So, the person sells 360K - 300K = 60K of bond to buy stock. The final AA is 270K+60K = 330K of stock and 300K of the bond...
by KlangFool
Tue Jul 17, 2018 7:29 am
Forum: Investing - Theory, News & General
Topic: Balanced Funds and Sequence of Return Risk
Replies: 38
Views: 1991

Re: Balanced Funds and Sequence of Return Risk

Let's assume the AA is 60/40 and the goal is 10 years of expense in Fixed income. Let's assume the retirement expense is 30K after the social security income of 30K. at 50x The portfolio is 1.5 million. 10 years of fixed income = 300K. Even after the stock drop 50%, the portfolio will lose 30%. The...
by KlangFool
Mon Jul 16, 2018 10:02 pm
Forum: Investing - Theory, News & General
Topic: Balanced Funds and Sequence of Return Risk
Replies: 38
Views: 1991

Re: Balanced Funds and Sequence of Return Risk

randomguy, <<I always like how people use pessimistic SWR and optimistic returns.;) >> Now, I am confused. Do you consider 5% to 7% nominal return as an optimistic return for a 60/40 portfolio? KlangFool Optimistic savings rate.:) Is 5-7% optimistic over 7 years? For a 2% SWR person it sure is. The...
by KlangFool
Mon Jul 16, 2018 7:00 pm
Forum: Personal Consumer Issues
Topic: Advice on IT Certification program
Replies: 93
Views: 3608

Re: Advice on IT Certification program

You are working for the wrong firm. And you just said in a previous post its basic economics. I pay something like $150FTE for medium cost are with 10 years or so of experience. In the Bay area I pay north of $200K which is very low for the bay, but, it is what it is. Students start out at about $6...
by KlangFool
Mon Jul 16, 2018 6:46 pm
Forum: Investing - Theory, News & General
Topic: Balanced Funds and Sequence of Return Risk
Replies: 38
Views: 1991

Re: Balanced Funds and Sequence of Return Risk

Or far less than a decade. 1) For folks that save 1 year of expense every year. Between the new contribution and growth, it does not take that long. It is in between 6 to 8 years. Starting Net Worth $1,500,000 Annual Savings $60,000 Years Annual Return Rate 6 7 8 5.00% $2,418,258 $2,599,171 $2,789,...
by KlangFool
Mon Jul 16, 2018 6:42 pm
Forum: Personal Consumer Issues
Topic: Advice on IT Certification program
Replies: 93
Views: 3608

Re: Advice on IT Certification program

A really good engineer or IT person is rare to find. You can train some people to a basic level but there is a level of intelligence, problem solving skills, tenacity you can't train. No amount of money or training will help at the advanced level. rich126, There is a bigger picture question here. W...
by KlangFool
Mon Jul 16, 2018 6:37 pm
Forum: Personal Consumer Issues
Topic: Advice on IT Certification program
Replies: 93
Views: 3608

Re: Advice on IT Certification program

I think you have a point except that we struggle to find enough people that are willing to do these jobs at pretty reasonable wages. You would maybe not be surprised at the number of people that say "I don't want to work with computers..." bampf, 1) This is Econ 101. Supply versus demand. If you ca...
by KlangFool
Mon Jul 16, 2018 4:36 pm
Forum: Personal Consumer Issues
Topic: Advice on IT Certification program
Replies: 93
Views: 3608

Re: Advice on IT Certification program

Folks, in my experience, the biggest risk to technology right now is a complete lack of emerging talent in many many areas. The old folks are getting out. The new generation is driving snapchat and literally has no idea how technologies work. Yes, my experience is anecdotal. However, I have a real ...
by KlangFool
Mon Jul 16, 2018 4:26 pm
Forum: Investing - Theory, News & General
Topic: Balanced Funds and Sequence of Return Risk
Replies: 38
Views: 1991

Re: Balanced Funds and Sequence of Return Risk

Nothing is a problem at 50x. It is like retiring in 1982. No matter what you do, you will win. Except that it might take you a decade or more to go from 25x to 50x. That could be a lot of 'lost time' just to pad what's already been a very conservative approach. willthrill81, << Except that it might...
by KlangFool
Mon Jul 16, 2018 4:18 pm
Forum: Investing - Theory, News & General
Topic: Balanced Funds and Sequence of Return Risk
Replies: 38
Views: 1991

Re: Balanced Funds and Sequence of Return Risk

Nothing is a problem at 50x. It is like retiring in 1982. No matter what you do, you will win. Except that it might take you a decade or more to go from 25x to 50x. That could be a lot of 'lost time' just to pad what's already been a very conservative approach. willthrill81, << Except that it might...
by KlangFool
Mon Jul 16, 2018 2:19 pm
Forum: Investing - Theory, News & General
Topic: Balanced Funds and Sequence of Return Risk
Replies: 38
Views: 1991

Re: Balanced Funds and Sequence of Return Risk

I do think that bucket strategies can work well, if for no other reason than they can make more intuitive sense than a traditional AA approach. But they are certainly more complicated, and many don't seem to understand that this complexity exists. willthrill81, I believe that traditional AA can wor...
by KlangFool
Mon Jul 16, 2018 11:30 am
Forum: Investing - Theory, News & General
Topic: Balanced Funds and Sequence of Return Risk
Replies: 38
Views: 1991

Re: Balanced Funds and Sequence of Return Risk

How do you know if stocks are down (or up)? This is the same as saying "stocks are low (or high)." It's very hard to tell. (This is based on the idea in the comment that With the 3FP, if stocks are down, you can withdraw from your bond fund in the original post.) This is the problem with the origin...
by KlangFool
Mon Jul 16, 2018 10:57 am
Forum: Investing - Theory, News & General
Topic: Balanced Funds and Sequence of Return Risk
Replies: 38
Views: 1991

Re: Balanced Funds and Sequence of Return Risk

If you rebalance, then, there is no difference between the 3FP and the balanced fund. KlangFool With the 3FP, if stocks are down, you can w/d bonds. With the Balanced Index fund,for example, every w/d is 60% equities and 40% fixed income. You can't choose which asset class to withdraw from. 1210 Th...
by KlangFool
Mon Jul 16, 2018 10:23 am
Forum: Investing - Theory, News & General
Topic: Balanced Funds and Sequence of Return Risk
Replies: 38
Views: 1991

Re: Balanced Funds and Sequence of Return Risk

If you are in the withdrawal phase, are Balanced Funds (Balanced Index funds, Lifestrategy funds, target date funds, etc.) affected more by Sequence of Return risk than individual funds such as in the 3 fund portfolio? With the 3FP, if stocks are down, you can withdraw from your bond fund (also hel...
by KlangFool
Mon Jul 16, 2018 9:33 am
Forum: Investing - Theory, News & General
Topic: Math help: 401k vs debt payoff formula
Replies: 17
Views: 1277

Re: Math help: 401k vs debt payoff formula

OP, 1) You could contribute to your 401K and put the money into the money market fund aka 0% return. But, save 35% tax. 2) Take a 401K loan and use the money to pay off the debt. They are 2 separate independent decisions. For example, you could do this. <<A. Contribute $10,000 ($6500 after tax in th...
by KlangFool
Mon Jul 16, 2018 9:12 am
Forum: Personal Finance (Not Investing)
Topic: Duration of Sequence of Return risk for long retirements
Replies: 34
Views: 1674

Re: Duration of Sequence of Return risk for long retirements

OP, In my opinion, SRR is highly dependent on the portfolio size as a multiple of annual expense. A) The person started at 25X. After 5 years, the portfolio grew to 50X even with the 4% withdrawal. I would say that this person had passed the danger zone. B) If the person started at 50X and with 2% w...
by KlangFool
Mon Jul 16, 2018 8:07 am
Forum: Investing - Theory, News & General
Topic: Why is leveraging property good but leveraging stocks bad?
Replies: 135
Views: 8220

Re: Why is leveraging property good but leveraging stocks bad?

It's safe to say that a lot of us will need to use 5x leverage or so to buy a property however, this is never touted as irresponsible. SpeculativeTrader, This is not true. I consider all leverage as bad. So, as per my (KlangFool) housing rule. A) Use a 20% down payment and 30 fixed mortgage to buy ...
by KlangFool
Sat Jul 14, 2018 9:06 pm
Forum: Personal Finance (Not Investing)
Topic: How Much in Your Emergency Fund And Is It Used?
Replies: 197
Views: 25985

Re: How Much in Your Emergency Fund And Is It Used?

For the people with $0 emergency funds and large taxable savings, how do you handle emergency/lumpy expenses? Do you really sell taxable investments and pay capital gains every time one of them comes down the line? Or do you keep other cash accounts that are earmarked for those lumpy expenses? Afty...
by KlangFool
Sat Jul 14, 2018 8:47 pm
Forum: Personal Consumer Issues
Topic: Advice on IT Certification program
Replies: 93
Views: 3608

Re: Advice on IT Certification program

OP, 1) So, basically, take whatever class and/or training and get a cert on it. 2) Apply to the entry-level tech job via job posting or social network. Contact folks that work in the companies that you are interested in via Linkedin. 3) Hope for the best. You just need someone to give your kid a sho...
by KlangFool
Sat Jul 14, 2018 5:24 pm
Forum: Personal Consumer Issues
Topic: Advice on IT Certification program
Replies: 93
Views: 3608

Re: Advice on IT Certification program

1) I disagreed. I was a Unix System Administrator for a large oil company. I never took any course in the operating system. I read all the books on Unix System Administration in order to do my job. Not every self-trained system administrator develops their skills to the level that you did. jalbert,...
by KlangFool
Sat Jul 14, 2018 3:06 pm
Forum: Investing - Help with Personal Investments
Topic: If my brokerage debit card is used fraudulently, who's responsible for margin interest charges?
Replies: 12
Views: 874

Re: If my brokerage debit card is used fraudulently, who's responsible for margin interest charges?

The obvious answer is no debit card. Why debit card is necessary when a person has a credit card? That's reasonable, too. I'm conflating debit and ATM cards, but I do need one for fee-free cash access when traveling abroad. drk, I explicitly put a restriction on my bank accounts that no debit card ...
by KlangFool
Sat Jul 14, 2018 2:54 pm
Forum: Investing - Help with Personal Investments
Topic: If my brokerage debit card is used fraudulently, who's responsible for margin interest charges?
Replies: 12
Views: 874

Re: If my brokerage debit card is used fraudulently, who's responsible for margin interest charges?

Maybe I underestimate the convenience factor, but it seems like the obvious solution is not to use debit cards that have access to any line of credit, be it overdraft protection or a margin account. drk, The obvious answer is no debit card. Why debit card is necessary when a person has a credit car...
by KlangFool
Sat Jul 14, 2018 11:55 am
Forum: Personal Consumer Issues
Topic: Advice on IT Certification program
Replies: 93
Views: 3608

Re: Advice on IT Certification program

1) I disagreed. I was a Unix System Administrator for a large oil company. I never took any course in the operating system. I read all the books on Unix System Administration in order to do my job. Not every self-trained system administrator develops their skills to the level that you did. jalbert,...
by KlangFool
Sat Jul 14, 2018 11:45 am
Forum: Investing - Theory, News & General
Topic: Why is leveraging property good but leveraging stocks bad?
Replies: 135
Views: 8220

Re: Why is leveraging property good but leveraging stocks bad?

OP, All leverages are bad. This applies to both property and stock. The relevant question is how much risk is the person taking. And, whether the gamble works out. In term of the mortgage, many people buy more houses than their existing rent. And, they buy the house with a mortgage. So, many mortgag...
by KlangFool
Sat Jul 14, 2018 8:56 am
Forum: Investing - Theory, News & General
Topic: Home ownership vs investing -- condos vs renting, etc
Replies: 108
Views: 5195

Re: Home ownership vs investing -- condos vs renting, etc

Maybe not a direct answer to the OP, but I've run the numbers of rent vs buy in my HCOL where price to rent ratio is 25+, and it's pretty much a draw. Making some reasonable assumptions (house price/rent rises with inflation, 3% real returns, etc.), if I invested the difference between buying a hou...
by KlangFool
Fri Jul 13, 2018 10:00 pm
Forum: Personal Consumer Issues
Topic: are mccormick gourmet spices better
Replies: 31
Views: 2054

Re: are mccormick gourmet spices better

hello, are mccormick gourmet spices better than the regular mccormick spices? how about compare with simply organic? or 365 brand? i enjoy finding good spices to cook. but i am also curious why mccormick stock has gone up so much recently. thanks. blackwhisker, Talk to your Indian friends and ask t...
by KlangFool
Fri Jul 13, 2018 9:54 pm
Forum: Personal Consumer Issues
Topic: Advice on IT Certification program
Replies: 93
Views: 3608

Re: Advice on IT Certification program

It is a limited level of training. For instance, there are limitations to the benefits of a course on Linux administration for someone who has not studied the fundamental principles of operating systems. It would be like taking a course on introduction to surgery without the fundamental science edu...
by KlangFool
Fri Jul 13, 2018 7:22 pm
Forum: Personal Consumer Issues
Topic: Advice on IT Certification program
Replies: 93
Views: 3608

Re: Advice on IT Certification program

I read through the thread and don't think I saw this asked/answered: Is Kid tech-savvy and INTERESTED in an IT career? My "kid" (22yo) started working a part-time tech-support job when he was 16 without any experience - just because he knew stuff that impressed the interviewer. He continued to work...
by KlangFool
Fri Jul 13, 2018 6:24 pm
Forum: Personal Finance (Not Investing)
Topic: Early retirement
Replies: 109
Views: 8945

Re: Early retirement

OP,

Just say that you are an independent consultant or you are self-employed. That would end the conversation.

KlangFool
by KlangFool
Fri Jul 13, 2018 4:03 pm
Forum: Investing - Theory, News & General
Topic: Home ownership vs investing -- condos vs renting, etc
Replies: 108
Views: 5195

Re: Home ownership vs investing -- condos vs renting, etc

Thanks for answering. In the real estate context, imputed income (rent is a form of income) is a very significant tax savings compared to renting. When you are a landlord for someone else, the rent the tenant pays you is taxable income; when you are a landlord for yourself, ie, when you live in you...
by KlangFool
Fri Jul 13, 2018 3:09 pm
Forum: Personal Consumer Issues
Topic: Advice on IT Certification program
Replies: 93
Views: 3608

Re: Advice on IT Certification program

delamer wrote:
Fri Jul 13, 2018 1:16 pm

Kid has had a few interviews but no offers.
delamer,

Get the book. It may help him/her in the interviewing process.

https://www.amazon.com/Ask-Headhunter-R ... 0452278015

KlangFool
by KlangFool
Fri Jul 13, 2018 2:55 pm
Forum: Investing - Theory, News & General
Topic: Home ownership vs investing -- condos vs renting, etc
Replies: 108
Views: 5195

Re: Home ownership vs investing -- condos vs renting, etc

Don't feel obliged to respond, as you have done so already, but as I look at both of your examples, what I see is that the cost of owning is less than renting, with a greater difference for the less expensive house. That's a good thing, but It's not obvious to me what that has to do with the concep...
by KlangFool
Fri Jul 13, 2018 1:21 pm
Forum: Investing - Theory, News & General
Topic: Home ownership vs investing -- condos vs renting, etc
Replies: 108
Views: 5195

Re: Home ownership vs investing -- condos vs renting, etc

I'm with you, especially the imputed income part. But pls explain why lower-price houses would be different? FWIW, I went looking for a place to rent for my college age daughter recently, and was surprised how high the rents are for lower cost houses, given how cheap they would be to buy. If I knew...
by KlangFool
Fri Jul 13, 2018 12:31 pm
Forum: Investing - Theory, News & General
Topic: Home ownership vs investing -- condos vs renting, etc
Replies: 108
Views: 5195

Re: Home ownership vs investing -- condos vs renting, etc

Maybe not a direct answer to the OP, but I've run the numbers of rent vs buy in my HCOL where price to rent ratio is 25+, and it's pretty much a draw. Making some reasonable assumptions (house price/rent rises with inflation, 3% real returns, etc.), if I invested the difference between buying a hou...
by KlangFool
Fri Jul 13, 2018 11:52 am
Forum: Personal Finance (Not Investing)
Topic: Would you trade experiences in your youth for early retirement
Replies: 81
Views: 5082

Re: Would you trade experiences in your youth for early retirement

OP, To each its own. So, I can only speak about my experience. 1) I save 1 year of expense every year. If I did not gamble on Telecom stock, I would have early retired in my late 40s. 2) At my income level, as long as I do not buy a house as expensive as my income peers, I have plenty of money to sp...
by KlangFool
Fri Jul 13, 2018 11:00 am
Forum: Investing - Theory, News & General
Topic: Home ownership vs investing -- condos vs renting, etc
Replies: 108
Views: 5195

Re: Home ownership vs investing -- condos vs renting, etc

Maybe not a direct answer to the OP, but I've run the numbers of rent vs buy in my HCOL where price to rent ratio is 25+, and it's pretty much a draw. Making some reasonable assumptions (house price/rent rises with inflation, 3% real returns, etc.), if I invested the difference between buying a hou...
by KlangFool
Fri Jul 13, 2018 7:58 am
Forum: Personal Consumer Issues
Topic: Advice on IT Certification program
Replies: 93
Views: 3608

Re: Advice on IT Certification program

OP, 1) My nephew graduated with a degree major in psychology and minor in computer science. It took him more than 1 year to find a job. He had no real internship experience. So, it might just take that long to get started. 2) Do your kid get many interviews? Or, just interview but no job offer? I wo...
by KlangFool
Fri Jul 13, 2018 7:45 am
Forum: Personal Consumer Issues
Topic: Advice on IT Certification program
Replies: 93
Views: 3608

Re: Advice on IT Certification program

OP, The IT world is migrating to the cloud environment. So, building your own computer and network is useful in gaining knowledge but it may not get you a job. Understanding the cloud environment might be a better and more direct approach. The leader in private cloud is VMware. So, I recommend takin...
by KlangFool
Fri Jul 13, 2018 7:40 am
Forum: Investing - Theory, News & General
Topic: Yield Curve Inversions — Any Benefit from Market Timing?
Replies: 16
Views: 921

Re: Yield Curve Inversions — Any Benefit from Market Timing?

I've yet to see a market timing scheme that outperformed consistently over long periods. You had seen it. It is right in front of you. It is a fixed AA with buy, holds, and rebalancing. With a fixed AA and rebalancing, you always "buy low and sell high". It is the best market timing tool by not tim...
by KlangFool
Thu Jul 12, 2018 9:32 pm
Forum: Personal Consumer Issues
Topic: Advice on IT Certification program
Replies: 93
Views: 3608

Re: Advice on IT Certification program

Well, obviously, my husband and I know people with jobs. But many are self-employed or work in huge organizations with limited contact with the IT staff. We don’t know anyone who works in IT. But maybe I need to broaden the way I am thinking about this? Suggestions welcome delamer, << But many are ...
by KlangFool
Thu Jul 12, 2018 8:58 pm
Forum: Personal Consumer Issues
Topic: Advice on IT Certification program
Replies: 93
Views: 3608

Re: Advice on IT Certification program

but its hard to get past HR/initial resume screenings with self taught skills alone audioaxes, Don't go through the HR. KlangFool But if you are trying to break into a field in which you have minimal contacts, you’ll need to deal with HR. delamer, 1) Who says so? Do you mean you have no contacts at...
by KlangFool
Thu Jul 12, 2018 8:53 pm
Forum: Personal Consumer Issues
Topic: Advice on IT Certification program
Replies: 93
Views: 3608

Re: Advice on IT Certification program

3) The following book is the bible for networking. If your kid can read this book and understand about 10% to 15% of what he read, he is in a very good shape. Most folks in networking will understand less than 50% of this book. I am in this area for 30+ years and I am nowhere close to 100%. And, th...
by KlangFool
Thu Jul 12, 2018 8:49 pm
Forum: Personal Consumer Issues
Topic: Advice on IT Certification program
Replies: 93
Views: 3608

Re: Advice on IT Certification program

audioaxes wrote:
Thu Jul 12, 2018 8:13 pm

but its hard to get past HR/initial resume screenings with self taught skills alone
audioaxes,

Don't go through the HR.

KlangFool
by KlangFool
Thu Jul 12, 2018 8:23 pm
Forum: Investing - Theory, News & General
Topic: Yield Curve Inversions — Any Benefit from Market Timing?
Replies: 16
Views: 921

Re: Yield Curve Inversions — Any Benefit from Market Timing?

I've yet to see a market timing scheme that outperformed consistently over long periods. You had seen it. It is right in front of you. It is a fixed AA with buy, holds, and rebalancing. With a fixed AA and rebalancing, you always "buy low and sell high". It is the best market timing tool by not tim...
by KlangFool
Thu Jul 12, 2018 8:06 pm
Forum: Personal Consumer Issues
Topic: Advice on IT Certification program
Replies: 93
Views: 3608

Re: Advice on IT Certification program

OP,

There are many possible jobs in the IT and Networking area. What is your kid's MBTI personality type? It could be useful for him/her to take the test. There should be a free test available online.

KlangFool
by KlangFool
Thu Jul 12, 2018 8:02 pm
Forum: Investing - Theory, News & General
Topic: Yield Curve Inversions — Any Benefit from Market Timing?
Replies: 16
Views: 921

Re: Yield Curve Inversions — Any Benefit from Market Timing?

I've yet to see a market timing scheme that outperformed consistently over long periods. SimpleGift, You had seen it. It is right in front of you. It is a fixed AA with buy, holds, and rebalancing. With a fixed AA and rebalancing, you always "buy low and sell high". It is the best market timing too...
by KlangFool
Thu Jul 12, 2018 7:57 pm
Forum: Personal Consumer Issues
Topic: Advice on IT Certification program
Replies: 93
Views: 3608

Re: Advice on IT Certification program

OP, 1) I worked in the networking area for about 30+ years. I installed my first network in 1985. 2) I have a BSEE and MSEE. But, almost everything that I learned about networking is from hands-on and self-study. 3) The following book is the bible for networking. If your kid can read this book and u...