Search found 571 matches

by TheHouse7
Wed Sep 29, 2021 5:10 pm
Forum: Personal Finance (Not Investing)
Topic: Normal to feel behind w/ savings?
Replies: 91
Views: 10365

Re: Normal to feel behind w/ savings?

Now that you mention it, I do feel behind. :|
by TheHouse7
Wed Sep 08, 2021 3:13 pm
Forum: Investing - Theory, News & General
Topic: How have you allocated your bond percentage?
Replies: 67
Views: 9070

Re: How have you allocated your bond percentage?

How much of your portfolio is allocated to bonds(non-stocks) and why? Which bond funds/bond etfs/treasury securities would you purchase now with excess cash holdings and why? [/b] e.g. Draw down/retirement in five years, TIPS - inflation protected, etc. I do appreciate all those who are sharing their opinions and knowledge on why bonds are good/bad at this current time and for some years. I want to understand fully before committing to any strategy. Retired, 73, all fixed 90% CDs 10% Vang. Intermed. Muni...roughly. I look for very high quality CDs/Individual treasuries/funds/or ETFs as recommended by Larry Swedroe or William Bernstein. Why all fixed? The 2008 sleep test put me here. What would I buy now with excess cash? duration matched T...
by TheHouse7
Wed Aug 11, 2021 12:14 pm
Forum: Personal Investments
Topic: ESPP dramatic change
Replies: 7
Views: 1179

Re: ESPP dramatic change

There are two questions: should you buy shares with ESPP and should you hold them. Given the discount, I don't see why you wouldn't buy. As for holding, depending on the plan, there may be some tax advantage to holding for 1+ years, but you take some risk on the stock, but less than others. Once you reach a qualifying disposition, I don't see the point in holding, unless you need to limit taxable income for that year in particular. What's this $40 for selling? Do you have some bad broker for the ESPP? It seems way more risky of a stock is why I ask. I think the $800+ made in discount per year is confusing for me on a risk analysis. Yes, $25 wire transfer $10+cents per share type of thing with computer share. :? Anyway to transfer shares ou...
by TheHouse7
Wed Aug 11, 2021 12:01 pm
Forum: Personal Investments
Topic: ESPP dramatic change
Replies: 7
Views: 1179

Re: ESPP dramatic change

AnEngineer wrote: Wed Aug 11, 2021 11:42 am There are two questions: should you buy shares with ESPP and should you hold them. Given the discount, I don't see why you wouldn't buy.

As for holding, depending on the plan, there may be some tax advantage to holding for 1+ years, but you take some risk on the stock, but less than others. Once you reach a qualifying disposition, I don't see the point in holding, unless you need to limit taxable income for that year in particular.

What's this $40 for selling? Do you have some bad broker for the ESPP?
It seems way more risky of a stock is why I ask. I think the $800+ made in discount per year is confusing for me on a risk analysis.

Yes, $25 wire transfer $10+cents per share type of thing with computer share. :?
by TheHouse7
Wed Aug 11, 2021 10:58 am
Forum: Personal Investments
Topic: ESPP dramatic change
Replies: 7
Views: 1179

ESPP dramatic change

Hi bogleheads, I have changed jobs last week after 5+ years with ECL @ a 15% discount ($6k cap per year). You could sell any amount at any time for around $40. Now, I can buy HAL @ a 10% discount (10% cap gross income per year). I think you could sell any amount quarterly for around $???. ESPP has been the least bogleheaded thing I have done in the last 5 years (buying a single stock), and didn't know what to think about this new opportunity. ECL had a great 5 year run for us to sell periodically to pay for home upgrades/replace appliances/ fund roth ira. I just figured out how to sell ECL at LTCG to pay for a new furnace and a/c unit this year. We don't need the discount as part of any short or mid term plan; I've just always taken advanta...
by TheHouse7
Sun Aug 01, 2021 11:23 am
Forum: Investing - Theory, News & General
Topic: Retiring in 2000 withdrawing fixed 5% ran out of money in 2016
Replies: 148
Views: 18870

Re: Retiring in 2000 withdrawing fixed 5% ran out of money in 2016

namajones wrote: Sun Aug 01, 2021 11:03 am
JoeRetire wrote: Sun Aug 01, 2021 6:17 am And cat food is getting expensive.
You can save by making your own cat food minus the meat products. Also, a lot of grocery stores throw away an amazing amount of very good food. You just need to know which times of day to hang around out back.
Awesome reply, would not be surprised about a cat going vegetarian :D
by TheHouse7
Fri Jul 30, 2021 11:22 pm
Forum: Personal Investments
Topic: Saving for 2022 Roth IRA lump sum contribution vs. DCA into taxable account now
Replies: 18
Views: 2818

Re: Saving for 2022 Roth IRA lump sum contribution vs. DCA into taxable account now

B, might want to create a mini-budget for your after tax account so there is always $6,000 earmarked for the beginning of the year.
by TheHouse7
Fri Jul 30, 2021 11:23 am
Forum: Personal Finance (Not Investing)
Topic: IRA to Roth IRA Conversion, no tax?!
Replies: 36
Views: 6173

Re: IRA to Roth IRA Conversion, no tax?!

morgen wrote: Thu Jul 29, 2021 11:43 pm Not to highjack this thread....

And that takes me around to what I was saying to the poster. It's crazy difficult how complex the 'To Roth, Or not to Roth' question can be. Tax rates, predicted tax rates, geographic, spousal, etc. Painful.
Amen, I thought I had this topic figured out 3 years ago, and I keep on revisiting it because I learn something new every time!
by TheHouse7
Thu Jul 29, 2021 5:39 pm
Forum: Personal Investments
Topic: Question about creating brokerage account through my 401k
Replies: 12
Views: 1259

Re: Question about creating brokerage account through my 401k

dbr wrote: Thu Jul 29, 2021 11:11 am
TheHouse7 wrote: Thu Jul 29, 2021 10:52 am I've never heard of this, and wonder what the downsides are to a self directed brokerage. Seems like so many more options with the same tax advantage. :confused
There can be some fees and some transaction costs, so you have to control that. My plan costs $10/month.

It also can happen that if your 401k charges you a small AUM for management that the fee does not apply to funds in the link, or not.

Also, there may be more transactions you need to manage to move money back and forth. There may be a minimum that has to be left in the plan, and RMDs can only be taken from the plan and not directly from the brokerage.

But, as stated, your plan has to offer it.
Thank you so much for the additional information. :sharebeer
by TheHouse7
Thu Jul 29, 2021 5:38 pm
Forum: Personal Investments
Topic: Question about creating brokerage account through my 401k
Replies: 12
Views: 1259

Re: Question about creating brokerage account through my 401k

I've never heard of this, and wonder what the downsides are to a self directed brokerage. Seems like so many more options with the same tax advantage. :confused Some plans include a self directed brokerage account (SDBA). At Fidelity it is called a BrokerageLink. At Schwab it is called Personal Choice Retirement Account (PCRA). Other plans call it a brokerage option or brokerage window. This feature can allow the plan participants to divert some of their account to a specific brokerage and use different investments there than are offered in the core 401k plan itself. I used the feature to buy Treasury bonds. The employer decides if this feature is included in the 401k, and whether any fees are charged, and any limits on its use. This featu...
by TheHouse7
Thu Jul 29, 2021 5:38 pm
Forum: Personal Investments
Topic: Question about creating brokerage account through my 401k
Replies: 12
Views: 1259

Re: Question about creating brokerage account through my 401k

I've never heard of this, and wonder what the downsides are to a self directed brokerage. Seems like so many more options with the same tax advantage. :confused Your plan has to first offer it. If offered, apart from the fees that are charged for the SDBO, you are correct, same tax advantage. My plan also has the SDBO, but charges a relatively steep fees of $240 per year, at the flat rate of $60 per quarter. Regardless of the balance. I have a portfolio of about $450k+ in my 401k plan, so if I were to choose the SDBO it would come to be less than 0.05% additional fee. But I do not have a need, since I have excellent options within the plan itself (an S&P 500 tracking collective investment trust at 0.02%, for example). Thank you so much...
by TheHouse7
Thu Jul 29, 2021 10:52 am
Forum: Personal Investments
Topic: Question about creating brokerage account through my 401k
Replies: 12
Views: 1259

Re: Question about creating brokerage account through my 401k

I've never heard of this, and wonder what the downsides are to a self directed brokerage. Seems like so many more options with the same tax advantage. :confused
by TheHouse7
Wed Jul 28, 2021 11:00 pm
Forum: Personal Finance (Not Investing)
Topic: What is the average savings rates for bogleheads?
Replies: 343
Views: 41054

Re: What is the average savings rates for bogleheads?

About 30-40% My spending per year is about $40k I spend very little less than 1% on discretionary. Everything else is savings. I want to be prepared to retire early should anything happen to my job in my rotten career (Chemist). My chances of getting another decent job in my field are low. I'm interested in your field, I work as a chemical tech. In an oil refinery, what is so rotten? The chemist I work with call them golden handcuffs. Horrifically poor pay, poor employment security etc. I graduated with a MSc and extensive research experience and spent 8 months unemployed because I was getting nothing but companies offering me $15/hr and forcing me to work via a temp agency so no benefits either. I finally got a decent job for $45k and ben...
by TheHouse7
Wed Jul 28, 2021 4:41 pm
Forum: Personal Consumer Issues
Topic: How much did you spend on Furniture?
Replies: 70
Views: 9776

Re: How much did you spend on Furniture?

Thanks for all the responses. Some clarifications. When I say formal room, I mean this is the room next to the fireplace with no TV that I plan to spend most of my time hanging out in, both with my wife and with my friends. My family room with the TV and where the kids will mostly hang out is going to get my current beat up $1500 couch. As I mentioned, this house isn't extravagant or anything, so it isn't like the "formal" living room is especially disconnected from where all the "living" happens. I am not a very formal person, and I wouldn't use it for formal visits or anything. It is just a part of the house where I would hang out by myself and my wife by the fire place or spend with friends when they visit. Furniture...
by TheHouse7
Wed Jul 28, 2021 12:44 am
Forum: Investing - Theory, News & General
Topic: How much money US printed in 2020 and what consequences it might have ?
Replies: 7
Views: 1585

Re: How much money US printed in 2020 and what consequences it might have ?

You didn't miss anything (as long as you didn't miss a stimulus check).

There will be no ramifications from this money being made as long as there is stable demand on the us dollar.

No body knows nothing about the future. :D

Leverage everything and buy real estate and stocks if you suspect inflation.

Hold cash if you suspect deflation.
by TheHouse7
Tue Jul 27, 2021 10:25 pm
Forum: Personal Finance (Not Investing)
Topic: One month, still no counteroffer [job]
Replies: 79
Views: 7282

Re: One month, still no counteroffer

Don’t work for a place like this. Either they don’t give a rip about you, in which case you should leave. Or they are institutionally incapable of doing the most basic things (like communicating ), in which case you should leave. I know you're making it sound dramatic, but it really does feel like that! I’m really not being dramatic. This is very basic HR stuff. It’s very telling that they can’t figure it out. A nefarious explanation is that they have no intention of matching, and are waiting/hoping for your new offer to expire or fall through. I manage 100 plus people, I would never leave an employee wondering. Ever. And sometimes they come in with competing offers, and I know I won’t be matching it, and I tell them that on the spot so th...
by TheHouse7
Tue Jul 27, 2021 4:52 pm
Forum: Personal Finance (Not Investing)
Topic: I've lost my motivation
Replies: 33
Views: 7691

Re: I've lost my motivation

You are not alone. I have been through 3 years of what you're experiencing. I will pray for you. This will pass. My experience led me to "check out" of my FT job. My managers were aware of my situation and we're very forthcoming and flexible with benefits and leave paid or unpaid.

I wish your family and you the best, even if that is just a decent night's sleep. :|
by TheHouse7
Mon Jul 26, 2021 10:56 am
Forum: Personal Finance (Not Investing)
Topic: Use credit card at stores instead of debit?
Replies: 150
Views: 12161

Re: Use credit card at stores instead of debit?

Winco, a boglehead type supermarket in the PNW, just takes debit cards or cash. It's the only reason I carry my debit card. WinCo FTW :sharebeer You can buy Winco gift cars on their site with credit cards. The large majority of our grocery shopping is at Winco and I've never used cash or a debit card there. I usually coincide buying Winco gift cards with opening a new rewards credit card. For instance, last year I bought $3k worth (8-10 months of groceries for us) to meet the 3-month spend on a new card. Not only did I get the $400 bonus, but 1.5% cash back, and I had 15 months 0% interest to pay it back. This is awesome, while not willing to do it myself, I really appreciate you speaking up about this method! Where/who do you get the $400...
by TheHouse7
Mon Jul 26, 2021 9:56 am
Forum: Personal Finance (Not Investing)
Topic: What is the average savings rates for bogleheads?
Replies: 343
Views: 41054

Re: What is the average savings rates for bogleheads?

34 yo, 35%, sahm, 2 kids under 4
by TheHouse7
Mon Jul 26, 2021 9:04 am
Forum: Personal Finance (Not Investing)
Topic: What is the average savings rates for bogleheads?
Replies: 343
Views: 41054

Re: What is the average savings rates for bogleheads?

sschoe2 wrote: Sat Jul 24, 2021 4:09 pm About 30-40% My spending per year is about $40k I spend very little less than 1% on discretionary. Everything else is savings. I want to be prepared to retire early should anything happen to my job in my rotten career (Chemist). My chances of getting another decent job in my field are low.
I'm interested in your field, I work as a chemical tech. In an oil refinery, what is so rotten? The chemist I work with call them golden handcuffs.
by TheHouse7
Mon Jul 26, 2021 8:44 am
Forum: Personal Finance (Not Investing)
Topic: [Getting a promotion, how do I negotiate a raise?]
Replies: 107
Views: 10411

Re: [Getting a promotion, how do I negotiate a raise?]

I have only had one meaningful promotion in my first 5 years at this mega corp. I was excited to come to the table to negotiate, and my manager told me: there is a flat 5%, and I can give you a 3% annual merit increase after that. That was the most he could do, and I was thankful that he didn't laugh at me when I asked for 25%. :( Had a similar conversion once... My manager told me there would be 3% raise in case of promo and if I don't like it I can start looking :annoyed After some digging I figured out that the range is 3-10% (for promos) :oops: Surprisingly, I switched to another team whose manager happily gave me 7%. The previous manager got fired in like 6 months after that but he did save few $ for the company :mrgreen: I wouldn't b...
by TheHouse7
Mon Jul 26, 2021 8:28 am
Forum: Personal Consumer Issues
Topic: Men - need boxer brief recommendations
Replies: 83
Views: 10914

Re: Men - need boxer brief recommendations

bltkmt wrote: Mon Jul 26, 2021 6:53 am
dcabler wrote: Sun Jul 25, 2021 9:31 pm Duluth Trading Company Armachillo line. I wear their briefs but they also have the same line in boxer briefs.

Cheers
Their Buck Naked boxer briefs are great too.
+1 :beer
by TheHouse7
Sun Jul 25, 2021 8:46 pm
Forum: Personal Finance (Not Investing)
Topic: Use credit card at stores instead of debit?
Replies: 150
Views: 12161

Re: Use credit card at stores instead of debit?

hicabob wrote: Sun Jul 25, 2021 1:34 pm Winco, a boglehead type supermarket in the PNW, just takes debit cards or cash. It's the only reason I carry my debit card.
WinCo FTW :sharebeer
by TheHouse7
Sun Jul 25, 2021 5:54 pm
Forum: Personal Finance (Not Investing)
Topic: Use credit card at stores instead of debit?
Replies: 150
Views: 12161

Re: Use credit card at stores instead of debit?

I use debt at stores (groceries). I haven't thought about credit cards in years. I wonder what that mental load is worth? Do I just have more time to worry about other things? I live in a small town and spend $10,000+ per year on only debt. The more I think about it, a few years ago, I thought about a Costco card for replacing appliances. Never went through with it, but thought about it. :wink: "Mental load"? $10,000+ on a 2% cashback card is $200+. Costco gives you a 4 year appliance warranty by buying there and using their card. What's that mental load worth as compared to a standard appliance warranty of 1 year? :wink: I can't comprehend having to control my spending by doing some of the things that people do, i.e. putting fun...
by TheHouse7
Sun Jul 25, 2021 7:50 am
Forum: Personal Investments
Topic: Early Retirement - No longer needing to work - Back of Napkin formulas to determine when?
Replies: 80
Views: 13166

Re: Early Retirement - No longer needing to work - Back of Napkin formulas to determine when?

lgb wrote: Sat Jul 24, 2021 11:45 pm
TheHouse7 wrote: Thu Jul 22, 2021 9:56 am There is a very good personal finance tool box spread sheet to help you estimate better than the back of napkin. Find it in the wiki under tools. :beer
I went to this, but wasn't ever able to locate any specific excel sheet mentioned. If there is a direct link or something I'd love to take a look at it.

Thanks for your input.
https://www.bogleheads.org/wiki/Tools_and_calculators

Under personal finance tool box.

Prepare your mind to be blown. :mrgreen:
by TheHouse7
Sun Jul 25, 2021 7:47 am
Forum: Personal Finance (Not Investing)
Topic: Use credit card at stores instead of debit?
Replies: 150
Views: 12161

Re: Use credit card at stores instead of debit?

I use debt at stores (groceries). I haven't thought about credit cards in years. I wonder what that mental load is worth? Do I just have more time to worry about other things?

I live in a small town and spend $10,000+ per year on only debt.

The more I think about it, a few years ago, I thought about a Costco card for replacing appliances. Never went through with it, but thought about it. :wink:
by TheHouse7
Sat Jul 24, 2021 2:37 pm
Forum: Personal Finance (Not Investing)
Topic: [Getting a promotion, how do I negotiate a raise?]
Replies: 107
Views: 10411

Re: [Getting a promotion, how do I negotiate a raise?]

I have only had one meaningful promotion in my first 5 years at this mega corp. I was excited to come to the table to negotiate, and my manager told me: there is a flat 5%, and I can give you a 3% annual merit increase after that. That was the most he could do, and I was thankful that he didn't laugh at me when I asked for 25%. :(
by TheHouse7
Thu Jul 22, 2021 6:59 pm
Forum: Personal Finance (Not Investing)
Topic: Roth 401K to Roth IRA
Replies: 8
Views: 906

Re: Roth 401K to Roth IRA

I don't think Roth IRA has any RMDs. I didn't ever consider roth 401k having RMDs.
by TheHouse7
Thu Jul 22, 2021 9:56 am
Forum: Personal Investments
Topic: Early Retirement - No longer needing to work - Back of Napkin formulas to determine when?
Replies: 80
Views: 13166

Re: Early Retirement - No longer needing to work - Back of Napkin formulas to determine when?

There is a very good personal finance tool box spread sheet to help you estimate better than the back of napkin. Find it in the wiki under tools. :beer
by TheHouse7
Thu Jul 22, 2021 12:36 am
Forum: Personal Finance (Not Investing)
Topic: Roth conversion calc. (34 yo)
Replies: 36
Views: 3404

Re: Roth conversion calc. (34 yo)

tomsense76 wrote: Thu Jul 22, 2021 12:24 am
TheHouse7 wrote: Wed Jul 21, 2021 10:34 pm Just quit a job creating my first meaningful traditional IRA rollover
Got it. So you are not planning on working in the near future? Agree it makes sense to do some Roth conversions now.
Sorry my wording is weird, I'm just changing jobs, 401k being rolled into tira. I will still have a similar income (88K).
by TheHouse7
Wed Jul 21, 2021 11:17 pm
Forum: Personal Finance (Not Investing)
Topic: Roth conversion calc. (34 yo)
Replies: 36
Views: 3404

Re: Roth conversion calc. (34 yo)

What marginal tax rates did you see for Roth conversions when you did the toolbox tax calculations? 12% I think 🤔 I'll have to look again. Assuming you gave it all the appropriate inputs (e.g., number of children, age ranges, other income, etc.), that 12% should be accurate. If you expect to be paying no less that 22% in all future years, it makes much sense to pay only 12% now. Kudos to you for engaging with all the commenters in this thread. One might think that would always happen - and probably does more often than not - but there are enough times posters don't respond to questions that it's worth noting. :) I just imagine my wife goes back to work and retirement ends up great (RMDs). Just a way to pass time while I'm stressed out abou...
by TheHouse7
Wed Jul 21, 2021 11:06 pm
Forum: Personal Finance (Not Investing)
Topic: Roth conversion calc. (34 yo)
Replies: 36
Views: 3404

Re: Roth conversion calc. (34 yo)

David Jay wrote: Fri Jul 16, 2021 12:33 pm I would take the EITC. There will be a low-income period between retirement and start of RMDs when you can convert.

Having about a half-million in 401K at start of retirement seems about optimal to me, if all retirement assets are in Roth then there is no way to take advantage of your standard deduction. Here is my thread on conversions after start of SS for some thoughts: viewtopic.php?f=10&t=237277
Your real world example is priceless for my brain 😂! I'm planning on a Tira balance of 1.8m(60 yo) if I don't change course (5% real rate of return with no job loss for 26 years). That's why I'm interested in tax rates in low/no income years.
by TheHouse7
Wed Jul 21, 2021 10:44 pm
Forum: Personal Finance (Not Investing)
Topic: Roth conversion calc. (34 yo)
Replies: 36
Views: 3404

Re: Roth conversion calc. (34 yo)

FiveK wrote: Wed Jul 21, 2021 10:36 pm
TheHouse7 wrote: Wed Jul 21, 2021 10:34 pm Roth conversion is considered for us because of
Max Roth iras
Max HSA
Just quit a job creating my first meaningful traditional IRA rollover,
And I don't think my tax burden is going down now/or in the future.
What marginal tax rates did you see for Roth conversions when you did the toolbox tax calculations?
12% I think 🤔 I'll have to look again. FiveK I'm honored that your on my thread after reading so much of your other posts about Roth vs traditional!
by TheHouse7
Wed Jul 21, 2021 10:34 pm
Forum: Personal Finance (Not Investing)
Topic: Roth conversion calc. (34 yo)
Replies: 36
Views: 3404

Re: Roth conversion calc. (34 yo)

I would take the EITC. There will be a low-income period between retirement and start of RMDs when you can convert. Having about a half-million in 401K at start of retirement seems about optimal to me, if all retirement assets are in Roth then there is no way to take advantage of your standard deduction. Here is my thread on conversions after start of SS for some thoughts: https://www.bogleheads.org/forum/viewtopic.php?f=10&t=237277 +1 I don't understand the need to convert to Roth now. While you are working and still accumulating assets, you have relatively little control of your tax rate (beyond saving in tax advantaged vehicles) and as you have seen the costs are high if this is not done carefully. In retirement you have a lot more ...
by TheHouse7
Wed Jul 21, 2021 10:27 pm
Forum: Personal Finance (Not Investing)
Topic: Roth conversion calc. (34 yo)
Replies: 36
Views: 3404

Re: Roth conversion calc. (34 yo)

02nz wrote: Sat Jul 17, 2021 3:16 pm
celia wrote: Sat Jul 17, 2021 1:38 pm
TheHouse7 wrote: Sat Jul 17, 2021 1:31 am I will try using the personal finance tool box this weekend. I used the fidelity Roth conversion tool and got intimidated by the result so I posted on the forum before going through other calculators.
Another great tool to use is last year’s tax software. Plug your estimated numbers in for this year or next to see what happens to your taxes.

Of course, that only helps you see a single year financial situation, not a multi-year projection.
Or this year's tax software when it comes out. TurboTax usually comes out in November, plenty of time to put in some numbers and see if a Roth conversion is worth it or not.
Thank you about the heads up in November. I will definitely be watching out for turbo tax.
by TheHouse7
Wed Jul 21, 2021 10:26 pm
Forum: Personal Finance (Not Investing)
Topic: Roth conversion calc. (34 yo)
Replies: 36
Views: 3404

Re: Roth conversion calc. (34 yo)

celia wrote: Sat Jul 17, 2021 1:38 pm
TheHouse7 wrote: Sat Jul 17, 2021 1:31 am I will try using the personal finance tool box this weekend. I used the fidelity Roth conversion tool and got intimidated by the result so I posted on the forum before going through other calculators.
Another great tool to use is last year’s tax software. Plug your estimated numbers in for this year or next to see what happens to your taxes.

Of course, that only helps you see a single year financial situation, not a multi-year projection.
I would try last year's tax software, but the feds keep changing the child tax credit. :beer
by TheHouse7
Wed Jul 21, 2021 10:23 pm
Forum: Personal Finance (Not Investing)
Topic: Roth conversion calc. (34 yo)
Replies: 36
Views: 3404

Re: Roth conversion calc. (34 yo)

This year we will receive even more child tax credit and I need help figuring out how to convert our traditional into roth while we pay little to no tax. Once you recognize that you have two contradictory goals (the child tax credit requires that you have low income, while Roth conversions give you higher income), you need to decide which one you to aim for. You can alternate each year if you want, but just recognize which one you are doing. For this year, continue what you’ve been doing, which is probably tax-deferring. For at least one year, I would do Roth conversions, or at least, make Roth contributions ( if eligible ) to start the 5-year clock and get some tax-free growth going in the Roths. (You apparently recognize the power of com...
by TheHouse7
Wed Jul 21, 2021 10:14 pm
Forum: Personal Finance (Not Investing)
Topic: Roth conversion calc. (34 yo)
Replies: 36
Views: 3404

Re: Roth conversion calc. (34 yo)

The EITC phaseout w/o 2 kids is 21%. You may have a state version (NY matches 30%, so the corresponding state phaseout is 6.3%). Then add your 12% federal bracket, and any state tax. In NY we'd be at 44.3% or so. EITC is definitely something to plan around if you are in range, or can put yourself in range with retirement/HSA contributions. We had a bunch of nonrefundable credits, which would have covered the tax on Roth conversions, but the increased AGI would have eliminated fed + state EITC and some nonrefundable credits like Saver's credit. The loss of refunds far outweighed the bit of conversion we could do, and the refunds were being used to fund Roth IRAs. Very useful input, I just switched jobs to not be eligible for the EITC with a...
by TheHouse7
Wed Jul 21, 2021 10:09 pm
Forum: Personal Finance (Not Investing)
Topic: Roth conversion calc. (34 yo)
Replies: 36
Views: 3404

Re: Roth conversion calc. (34 yo)

I don't know where tax rates will be in the future, No one else knows either. The more important thing is that the progressive tax income system is very likely to remain in place even decades from now, regardless of what the precise tax rates are. That means most people will face lower rates in retirement than they do in their working years, because their income is much lower in retirement. I don't know what inflation will be in the future (or deflation), I don't know how much I will need to withdrawal from taxable assets on a yearly basis to cover my future living expenses. Real seems useless to actionable things right now with so many unknowns. Maybe you're not understanding what "real returns" means. It means the return after ...
by TheHouse7
Wed Jul 21, 2021 11:25 am
Forum: Personal Consumer Issues
Topic: Washer/Dryer Recommendations
Replies: 78
Views: 10162

Re: Washer/Dryer Recommendations

surfstar wrote: Wed Jul 21, 2021 9:42 am I postulate that BHs skews towards the older side, and therefore a recommendation for a simple design, top loader seems to reign (get it) supreme here.
I imagine that if it was a forum of millennial and Gen X homeowners, the front load fears wouldn't be so overblown.

I'll just say that if you live in the SW or elsewhere that is always in the middle of a drought - try a front loader. :sharebeer
I prefer the wisdom of older generations when it comes to purchases over $1,000. Company manufacturing "efficiency"has not been for the consumer benefit for some time imho.
by TheHouse7
Sun Jul 18, 2021 11:12 am
Forum: Personal Investments
Topic: Rate My Roth IRA - 22 Year Old
Replies: 21
Views: 2476

Re: Rate My Roth IRA - 22 Year Old

Preface & background: I am 26. I started investing heavily at your age. My income has never been above $80k base per annum. I graduated college with no debt. I'm interested in reaching FI as soon as possible without forgoing life's pleasures (as I deem them). I have amassed approx. $200k in investments in 4 years (LBYM, invest the rest, stay the course) My advice on your Roth IRA Investments: Consolidate your Roth IRA into one fund, SCHB. There is no evidence that (long term) any of the other choices will grant you downside protection, so your point about mitigating risk is a somewhat null. Don't leave cash on the sidelines waiting for the right time to buy. Don't time the market. Invest when you can, as often as you can. Plain and sim...
by TheHouse7
Sat Jul 17, 2021 11:33 am
Forum: Personal Finance (Not Investing)
Topic: Roth conversion calc. (34 yo)
Replies: 36
Views: 3404

Re: Roth conversion calc. (34 yo)

Last year, we qualified for the EITC for the first time (amazing). I put an extra 10k of income (to represent a 401k roth contribution) and lost a $4,000 credit! This year we will receive even more child tax credit and I need help figuring out how to convert our traditional into roth while we pay little to no tax. I think our goal should be to convert up to a 10-12% marginal rate. Am I crazy to miss out on a EITC year? A general rule for a Roth IRA conversion is "do it if your marginal tax rate on the conversion now is lower than you expect it would be after you retire - otherwise don't do it now." You could figure your marginal tax rate now for a range of conversion amounts by doing what it appears you have done already: change ...
by TheHouse7
Sat Jul 17, 2021 11:30 am
Forum: Personal Finance (Not Investing)
Topic: Roth conversion calc. (34 yo)
Replies: 36
Views: 3404

Re: Roth conversion calc. (34 yo)

I agree that paying an effective 40% tax on a Roth conversion (or switching from traditional to Roth contribution) is not a good idea. Actually it could be well over 50%, as 40% is just the loss of the EITC, before the tax on the additional income. Having about a half-million in 401K at start of retirement seems about optimal to me, if all retirement assets are in Roth then there is no way to take advantage of your standard deduction. Here is my thread on conversions after start of SS for some thoughts: https://www.bogleheads.org/forum/viewtopic.php?f=10&t=237277 I assume you mean in today's dollars. OP will need to keep that in mind, and use real not nominal returns to project portfolio growth. (I shake my head every time I see a cert...
by TheHouse7
Sat Jul 17, 2021 1:31 am
Forum: Personal Finance (Not Investing)
Topic: Roth conversion calc. (34 yo)
Replies: 36
Views: 3404

Re: Roth conversion calc. (34 yo)

Last year, we qualified for the EITC for the first time (amazing). I put an extra 10k of income (to represent a 401k roth contribution) and lost a $4,000 credit! This year we will receive even more child tax credit and I need help figuring out how to convert our traditional into roth while we pay little to no tax. I think our goal should be to convert up to a 10-12% marginal rate. Am I crazy to miss out on a EITC year? A general rule for a Roth IRA conversion is "do it if your marginal tax rate on the conversion now is lower than you expect it would be after you retire - otherwise don't do it now." You could figure your marginal tax rate now for a range of conversion amounts by doing what it appears you have done already: change ...
by TheHouse7
Sat Jul 17, 2021 1:27 am
Forum: Personal Finance (Not Investing)
Topic: Roth conversion calc. (34 yo)
Replies: 36
Views: 3404

Re: Roth conversion calc. (34 yo)

FiveK wrote: Sat Jul 17, 2021 1:24 am
TheHouse7 wrote: Fri Jul 16, 2021 10:17 am Last year, we qualified for the EITC for the first time (amazing). I put an extra 10k of income (to represent a 401k roth contribution) and lost a $4,000 credit!
Careful - what type of income did you use?

The EITC has an "investment income" limit, so if you put in $10K of, say, interest, the law treats that different from putting $10K into a Roth 401k instead of a traditional 401k. Does that make sense?
I just added 10k to the top line gross taxable income.
by TheHouse7
Sat Jul 17, 2021 1:26 am
Forum: Personal Finance (Not Investing)
Topic: Roth conversion calc. (34 yo)
Replies: 36
Views: 3404

Re: Roth conversion calc. (34 yo)

I agree that paying an effective 40% tax on a Roth conversion (or switching from traditional to Roth contribution) is not a good idea. Actually it could be well over 50%, as 40% is just the loss of the EITC, before the tax on the additional income. Having about a half-million in 401K at start of retirement seems about optimal to me, if all retirement assets are in Roth then there is no way to take advantage of your standard deduction. Here is my thread on conversions after start of SS for some thoughts: https://www.bogleheads.org/forum/viewtopic.php?f=10&t=237277 I assume you mean in today's dollars. OP will need to keep that in mind, and use real not nominal returns to project portfolio growth. (I shake my head every time I see a cert...
by TheHouse7
Sat Jul 17, 2021 1:17 am
Forum: Personal Finance (Not Investing)
Topic: Roth conversion calc. (34 yo)
Replies: 36
Views: 3404

Re: Roth conversion calc. (34 yo)

Statistical wrote: Fri Jul 16, 2021 12:58 pm What is your assumed goal for converting traditional IRA to Roth IRA now? Do you anticipate your income and thus taxes to be higher than it is now in retirement (discount inflation because tax brackets are indexed to inflation)?

To answer your direct question I absolutely would not lose a $4K tax credit to convert an IRA.
I'm estimating that we will have 3-7m in retirement. I'm assuming that there will be less wiggle room in the low to no tax marginal rate I have now.
by TheHouse7
Sat Jul 17, 2021 1:14 am
Forum: Personal Finance (Not Investing)
Topic: Roth conversion calc. (34 yo)
Replies: 36
Views: 3404

Re: Roth conversion calc. (34 yo)

I would take the EITC. There will be a low-income period between retirement and start of RMDs when you can convert. Having about a half-million in 401K at start of retirement seems about optimal to me, if all retirement assets are in Roth then there is no way to take advantage of your standard deduction. Here is my thread on conversions after start of SS for some thoughts: https://www.bogleheads.org/forum/viewtopic.php?f=10&t=237277 Thank you for the reply, I always figured that there was a ball park figure for tax deferred going into retirement, but lump sum investing 150k now in 30 years is like 2m?! At that point of thinking I start with how do I pay the least tax now AND later. My career later can enjoy the tax deductions when my i...
by TheHouse7
Fri Jul 16, 2021 10:17 am
Forum: Personal Finance (Not Investing)
Topic: Roth conversion calc. (34 yo)
Replies: 36
Views: 3404

Roth conversion calc. (34 yo)

Hi BHs, I'm having a difficult time wrapping my head around a job change. I will be creating a new rollover ira at vanguard and got me thinking about roth conversion strategy in our low income years. MFJ (2021) 2 dependents (under 6 years old) Washington State (no income tax) Gross: $88,000 401k traditional contribution $19,500 HSA contribution: $6,500 Standard deduction: $25,100 Sold company stock: 1,800 LTCG His rollover ira: $150k Her rollover ira: $70k Last year, we qualified for the EITC for the first time (amazing). I put an extra 10k of income (to represent a 401k roth contribution) and lost a $4,000 credit! This year we will receive even more child tax credit and I need help figuring out how to convert our traditional into roth whil...