Search found 4028 matches

by willthrill81
Thu May 24, 2018 12:17 pm
Forum: Investing - Theory, News & General
Topic: The Millionaire Next Door and civil servants
Replies: 82
Views: 11635

Re: The Millionaire Next Door and civil servants

I would define anyone who makes $350k/year as rich, even if they have a negative net worth. 'Rich' is a subjective word, but most people do not define it as having a relatively high income. Most view wealth in terms of assets . I do not view a person making $350k annually but with little net worth ...
by willthrill81
Thu May 24, 2018 12:11 pm
Forum: Investing - Theory, News & General
Topic: Why do so many people quote "You will likely be in a lower tax bracket in retirement"
Replies: 436
Views: 21718

Re: Why do so many people quote "You will likely be in a lower tax bracket in retirement"

My feeling is that not being in a lower tax bracket when you retire is a nice problem to have. :sharebeer That's my perception of the situation as well. Given that the overwhelming majority of retirees are in a lower bracket (often several lower), unless one has a compelling reason to believe that ...
by willthrill81
Thu May 24, 2018 12:05 pm
Forum: Investing - Theory, News & General
Topic: Withdrawal Rates – Part 24: Flexibility Myths vs. Reality
Replies: 81
Views: 8588

Re: Withdrawal Rates – Part 24: Flexibility Myths vs. Reality

While he characterizes the cash bucket as being in addition to the 80/20 portfolio, the 27.5X annual spending equates to a 3.64% withdrawal rate. But interestingly, he earlier determined that a 3.26% WR was needed for the 1929 cohort to make it, and a 3.49% WR was needed for the 1966 cohort. So may...
by willthrill81
Thu May 24, 2018 12:31 am
Forum: Investing - Theory, News & General
Topic: Retirement bonds
Replies: 45
Views: 4108

Re: Retirement bonds

Since there was some discussion regarding how to value Social Security in this thread, I thought it worthwhile to note that ERN recently calculated it in a different way: how much does SS improve your withdrawal rate in retirement? Social Security, to be sure, can be a great addition to the early re...
by willthrill81
Thu May 24, 2018 12:21 am
Forum: Investing - Theory, News & General
Topic: Why do "traditional slice-and-dice" portfolios split 50/50 between value and blend?
Replies: 13
Views: 820

Re: Why do "traditional slice-and-dice" portfolios split 50/50 between value and blend?

In so many words, Paul Merriman says that he advocates a 50/50 split to reduce tracking error. He argues that it will be difficult for most investors to have their portfolios look too different from 'the market'. That makes perfect sense to me. Also, if the value premium doesn't come through for you...
by willthrill81
Thu May 24, 2018 12:16 am
Forum: Investing - Theory, News & General
Topic: Withdrawal Rates – Part 24: Flexibility Myths vs. Reality
Replies: 81
Views: 8588

Re: Withdrawal Rates – Part 24: Flexibility Myths vs. Reality

In part 25, ERN demonstrates that having a relatively small cash cushion (i.e. bucket strategy) actually worked very well in the two worst-case scenarios for retirees (1929 and 1966). What I assume here is that the cash bucket doesn’t reduce the stock/bond investment but it’s in addition to the $1m ...
by willthrill81
Wed May 23, 2018 7:30 pm
Forum: Investing - Theory, News & General
Topic: Paul Merriman on Market Timing Discussion Thread
Replies: 10
Views: 1320

Re: Paul Merriman on Market Timing Discussion Thread

badbreath wrote:
Wed May 23, 2018 7:26 pm
I dont like the portfolio he recommends to much work.

https://portfoliocharts.com/portfolio/m ... -ultimate/
Out of curiosity, why? Too many slices?
by willthrill81
Wed May 23, 2018 7:28 pm
Forum: Investing - Theory, News & General
Topic: The Millionaire Next Door and civil servants
Replies: 82
Views: 11635

Re: The Millionaire Next Door and civil servants

Over half of M.D.s having a net worth under $2 million at age 60-64 is amazing. A $2 million portfolio can be achieved with $2,500 investment monthly for 30 years at a 5% real return. Saving 30k/year when you are making <100k is a lot (i.e. starting doctors salaries 30 years ago). Even today there ...
by willthrill81
Wed May 23, 2018 4:09 pm
Forum: Investing - Theory, News & General
Topic: New Trend: Bonds in Roth IRA
Replies: 10
Views: 1473

Re: New Trend: Bonds in Roth IRA

IMHO you don't need to hold bonds anywhere, at least if you're over a decade away from retirement. As far as risk goes, extra stocks in a tax-deferred account makes tax planning more difficult. The goal is to flatten out your tax rate through trying to realize approximately equal amounts of income ...
by willthrill81
Wed May 23, 2018 2:31 pm
Forum: Investing - Theory, News & General
Topic: The Millionaire Next Door and civil servants
Replies: 82
Views: 11635

Re: The Millionaire Next Door and civil servants

I believe that White Coat Investor says that around 20% of M.D.s at age 60 have a net worth under $300k, barely more than the median household net worth for 65-69 year olds in the U.S. I found this surprising but after checking the data, it is not too far off, if any. https://www.beckersasc.com/asc...
by willthrill81
Wed May 23, 2018 2:15 pm
Forum: Investing - Theory, News & General
Topic: The Millionaire Next Door and civil servants
Replies: 82
Views: 11635

Re: The Millionaire Next Door and civil servants

People that look rich tend to be rich. Many are "All hat, no cattle." You can't tell someone's net worth by looking at their car, their house or their clothing. Queue the typical 35 year old M.D. who has a big home, multiple new vehicles, nice clothes, and takes exotic vacations, yet has a net wort...
by willthrill81
Wed May 23, 2018 1:00 pm
Forum: Investing - Theory, News & General
Topic: will the SP500 double in 7 years?
Replies: 100
Views: 11012

Re: will the SP500 double in 7 years?

The S&P can only grow, over time, as much as the underlying economy grows... I don't think this is really true. There are at least three ways the S&P can grow. One is as the economy grows, a second is that the S&P 500 could increase the share of the total economy that it represents, and a third is ...
by willthrill81
Wed May 23, 2018 10:24 am
Forum: Investing - Theory, News & General
Topic: Paul Merriman on Market Timing Discussion Thread
Replies: 10
Views: 1320

Re: Paul Merriman on Market Timing Discussion Thread

I think that Paul Merriman's views on trend following actually overlap a lot with those of Larry Swedroe. I agree with Paul and Meb Faber that the biggest challenge of trend following is potentially underperforming the market for a long period, perhaps a decade or more. But the challenge of buy-and-...
by willthrill81
Wed May 23, 2018 10:23 am
Forum: Investing - Theory, News & General
Topic: Asset Class Forecasts
Replies: 47
Views: 2332

Re: Asset Class Forecasts

aburntoutcase wrote:
Wed May 23, 2018 8:43 am
gmaynardkrebs wrote:
Tue May 22, 2018 10:02 pm
aburntoutcase wrote:
Tue May 22, 2018 8:50 pm
... would rather not go into next bear market with 60% equity.
Who would?
Someone with a modest portfolio early in savings cycle might not care whether they are at 60% or even 100%.
Hence the traditional wisdom of the glidepath.
by willthrill81
Tue May 22, 2018 10:27 pm
Forum: Investing - Theory, News & General
Topic: Fact, Fiction, and the Size Effect
Replies: 44
Views: 2692

Re: Fact, Fiction, and the Size Effect

Similarly, Jeremy Siegel had noted long ago that the size effect is completely attributable to the single time period 1975 through 1983. Throw out that time period and the whole small-cap premium disappears. I verified this in Portfolio Visualizer and was amazed to see that from 1984 until now, the...
by willthrill81
Tue May 22, 2018 9:21 pm
Forum: Investing - Theory, News & General
Topic: Typical interest rate earned by target date funds in retirement?
Replies: 28
Views: 1835

Re: Typical interest rate earned by target date funds in retirement?

Based on all the work done on safe withdrawal rates and corresponding AA, Vanguard and other target date fund providers definitely seem to be catering to the risk-averse crowd with their terminal AA. Historic success rates for the '4% rule' have been highest with higher stock allocations, usually i...
by willthrill81
Tue May 22, 2018 8:39 pm
Forum: Investing - Theory, News & General
Topic: will the SP500 double in 7 years?
Replies: 100
Views: 11012

Re: will the SP500 double in 7 years?

whodidntante wrote:
Tue May 22, 2018 7:14 pm
willthrill81 wrote:
Tue May 22, 2018 6:13 pm
whodidntante wrote:
Tue May 22, 2018 5:48 pm
The real question is, will the S&P 500 double in 7 years?
From now?

My crystal ball is in the shop, and they don't return my calls. :(
If you repaired a crystal ball, would you give it back? :twisted:
Good point. :oops:
by willthrill81
Tue May 22, 2018 6:13 pm
Forum: Investing - Theory, News & General
Topic: will the SP500 double in 7 years?
Replies: 100
Views: 11012

Re: will the SP500 double in 7 years?

whodidntante wrote:
Tue May 22, 2018 5:48 pm
The real question is, will the S&P 500 double in 7 years?
From now?

My crystal ball is in the shop, and they don't return my calls. :(
by willthrill81
Tue May 22, 2018 5:13 pm
Forum: Investing - Theory, News & General
Topic: Rob Arnott:index Investors Buy High, Sell Low
Replies: 51
Views: 4736

Re: Rob Arnott:index Investors Buy High, Sell Low

jalbert wrote:
Tue May 22, 2018 5:07 pm
And keep in mind that Rob Arnott’s research and company products are predicated on his view expressed in that article being correct.
The same could be said of anyone with any vested interest in their advice, including every financial advisor out there.
by willthrill81
Tue May 22, 2018 5:10 pm
Forum: Investing - Theory, News & General
Topic: Rob Arnott:index Investors Buy High, Sell Low
Replies: 51
Views: 4736

Re: Rob Arnott:index Investors Buy High, Sell Low

If Rob is right, and this buy-high sell-low phenomenon in the markets is so easy to avoid, where is the outperformance by active managers? For one, the number of potential investment strategies is infinite, whereas there are only a finite number of active managers. Every potential strategy cannot b...
by willthrill81
Tue May 22, 2018 4:46 pm
Forum: Investing - Theory, News & General
Topic: Asset Class Forecasts
Replies: 47
Views: 2332

Re: Asset Class Forecasts

We have been in a long bull-market for the past 9 years, so I realize that there is recency bias here, but I am constantly struck by how actual realized long-term equity returns in the US have often exceeded forecasts. Bogle himself has a terrible track record in predicting market returns. I believ...
by willthrill81
Tue May 22, 2018 4:13 pm
Forum: Investing - Theory, News & General
Topic: Typical interest rate earned by target date funds in retirement?
Replies: 28
Views: 1835

Re: Typical interest rate earned by target date funds in retirement?

Note that Vanguard's terminal allocation for retirement is 30/70 stock/bond, as is the Fidelity Freedom Index fund, although the latter takes longer to get there. TIAA Lifecycle funds level off at 40/60. The Government's TSP plan levels off at 20/80. I suggest that 30/70 - 50/50 is a more appropria...
by willthrill81
Mon May 21, 2018 11:54 pm
Forum: Investing - Theory, News & General
Topic: Do bonds make sense if you are more than 10 years from retirement?
Replies: 11
Views: 1301

Re: Do bonds make sense if you are more than 10 years from retirement?

Bonds provide very valuable stability to a portfolio. If you only focus on return but losing sight on risk, that is not a balanced view. This probably isn't the best time to look at bonds as "stable," but I understand your meaning. :-) The point is, if your time horizon is 20+ years out, and stocks...
by willthrill81
Mon May 21, 2018 11:47 pm
Forum: Investing - Theory, News & General
Topic: Ideal time/balance to start HSA drawdown?
Replies: 6
Views: 625

Re: Ideal time/balance to start HSA drawdown?

After-tax proceeds from HSA withdrawals might be less than after-tax proceeds from withdrawing earlier tax-free for medical expenses and putting into a taxable account. So what you're describing is simply to take advantage of only two of the HSA's tax-advantages: tax-deferred contributions and tax-...
by willthrill81
Mon May 21, 2018 11:34 pm
Forum: Investing - Theory, News & General
Topic: The Millionaire Next Door and civil servants
Replies: 82
Views: 11635

Re: The Millionaire Next Door and civil servants

Retired Civil Servant here and well into the two comma club as are many of the scientists and engineers I worked with during my career. I rather enjoyed the book when it first came out, probably because it reenforced my ongoing urge to live below my means and invest the rest wisely. That being said...
by willthrill81
Mon May 21, 2018 11:31 pm
Forum: Investing - Theory, News & General
Topic: "Why 97% of People Don't Use 529 College Savings Plans."
Replies: 262
Views: 47170

Re: "Why 97% of People Don't Use 529 College Savings Plans."

I will never use a 529 plan because of simplicity. Imagine I have two kids so I have two 529 plans, a 401K (at least 1), a ROTH, HSA, taxable (maybe more than 1), etc. Too much for me. I like simplicity . I like to have as few accounts as possible. It keeps my money more focused. Hurray for simplic...
by willthrill81
Mon May 21, 2018 7:51 pm
Forum: Investing - Theory, News & General
Topic: "Why 97% of People Don't Use 529 College Savings Plans."
Replies: 262
Views: 47170

Re: "Why 97% of People Don't Use 529 College Savings Plans."

Wouldn't a prudent couple have an emergency fund established PRIOR to having children? If I strongly believed in emergency funds I think I would have had one prior to having children in the family. You don't have to look far, even among Bogleheads, to find those with no emergency fund. Once again, ...
by willthrill81
Mon May 21, 2018 7:42 pm
Forum: Investing - Theory, News & General
Topic: will the SP500 double in 7 years?
Replies: 100
Views: 11012

Re: will the SP500 double in 7 years?

I would argue that once you have hit your goal prior to the "strike date", the remaining time is irrelevant. The point is that one has the option of taking the entirety of one's investment out of the market and moving it to riskless treasuries for the remainder of the time period. Remaining in the ...
by willthrill81
Mon May 21, 2018 4:04 pm
Forum: Investing - Theory, News & General
Topic: Why do so many people quote "You will likely be in a lower tax bracket in retirement"
Replies: 436
Views: 21718

Re: Why do so many people quote "You will likely be in a lower tax bracket in retirement"

dknightd wrote:
Mon May 21, 2018 3:31 pm
You might be in a higher tax bracket, or a lower tax bracket. It is impossible for us to predict.
We cannot predict it precisely, of course. But we can probably do a lot better than random chance.
by willthrill81
Mon May 21, 2018 4:01 pm
Forum: Investing - Theory, News & General
Topic: "Why 97% of People Don't Use 529 College Savings Plans."
Replies: 262
Views: 47170

Re: "Why 97% of People Don't Use 529 College Savings Plans."

As Klangfool has said repeatedly, it's better to not fund a 529 and keep your family fed than not to. I believe many people believe you can actually do both. I am one of those people. Certainly others are not. Broken Man 1999 You probably can, but there's a reason we call emergency funds that. The ...
by willthrill81
Mon May 21, 2018 1:15 pm
Forum: Investing - Theory, News & General
Topic: "Why 97% of People Don't Use 529 College Savings Plans."
Replies: 262
Views: 47170

Re: "Why 97% of People Don't Use 529 College Savings Plans."

As Klangfool has said repeatedly, it's better to not fund a 529 and keep your family fed than not to. I believe many people believe you can actually do both. I am one of those people. Certainly others are not. Broken Man 1999 You probably can, but there's a reason we call emergency funds that. The ...
by willthrill81
Mon May 21, 2018 12:57 pm
Forum: Personal Finance (Not Investing)
Topic: Is there a phrase for that?
Replies: 14
Views: 1107

Re: Is there a phrase for that?

I've thought quite a lot about this scenario as it applies to our situation. Assuming 5% real growth, if I stopped making all contributions to retirement accounts at age 45, I would still likely reach FI by around age 60 as opposed to the 50-55 that I'm planning for. Considering that we'll have no d...
by willthrill81
Mon May 21, 2018 12:49 pm
Forum: Investing - Theory, News & General
Topic: "Why 97% of People Don't Use 529 College Savings Plans."
Replies: 262
Views: 47170

Re: "Why 97% of People Don't Use 529 College Savings Plans."

As Klangfool has said repeatedly, it's better to not fund a 529 and keep your family fed than not to.
by willthrill81
Mon May 21, 2018 12:26 pm
Forum: Investing - Theory, News & General
Topic: Why do so many people quote "You will likely be in a lower tax bracket in retirement"
Replies: 436
Views: 21718

Re: Why do so many people quote "You will likely be in a lower tax bracket in retirement"

If you'll be in the same tax bracket during retirement as when you were working, Roth conversions are unlikely to result in tax savings. This will not hold true if any of your Social Security income gets taxed and you could have avoided that by using Roth dollars rather than tax deferred dollars. A...
by willthrill81
Mon May 21, 2018 12:04 pm
Forum: Investing - Theory, News & General
Topic: Why do so many people quote "You will likely be in a lower tax bracket in retirement"
Replies: 436
Views: 21718

Re: Why do so many people quote "You will likely be in a lower tax bracket in retirement"

If you'll be in the same tax bracket during retirement as when you were working, Roth conversions are unlikely to result in tax savings.
by willthrill81
Mon May 21, 2018 10:45 am
Forum: Investing - Theory, News & General
Topic: Why do so many people quote "You will likely be in a lower tax bracket in retirement"
Replies: 436
Views: 21718

Re: Why do so many people quote "You will likely be in a lower tax bracket in retirement"

There is one more monkey wrench that pre tax has. Early retirement. If I retire at 50-55 as planned, I will have 5-10 years that my 401k pretax is untouchable. To me the pretax has a pretty limited window of being useful. Ages 60-70. After 70 you are forced to take an increasingly large amount out ...
by willthrill81
Mon May 21, 2018 10:39 am
Forum: Investing - Theory, News & General
Topic: will the SP500 double in 7 years?
Replies: 100
Views: 11012

Re: will the SP500 double in 7 years?

I'm with Victoria. Yes, it's worth revisiting one's old predictions, but by jumping the gun, Snowjob has simply launched a fresh round of arguments over our personal predictions about the next seven months. Of course, willthrill's point is how bad predictions are, but he is predicting that Snowjob'...
by willthrill81
Sun May 20, 2018 10:40 pm
Forum: Investing - Theory, News & General
Topic: Buffett says Bonds are a terrible investment now. What should we invest in besides stocks?
Replies: 76
Views: 9436

Re: Buffett says Bonds are a terrible investment now. What should we invest in besides stocks?

Regarding the allocation of 90% stock / 10% bond that Buffett recommends for his future widow — it’s worth remembering that her income needs would be met safely by the return on a cautious 50/50 allocation of a certain sum. But if a larger sum will be hers to invest, the excess capital might as wel...
by willthrill81
Sun May 20, 2018 10:25 pm
Forum: Investing - Theory, News & General
Topic: will the SP500 double in 7 years?
Replies: 100
Views: 11012

Re: will the SP500 double in 7 years?

It would take a drop of nearly 20% from current levels for stocks to not have doubled since the time of the OP. That is, of course, possible, but historically not likely to occur within the next seven months. It goes to show you that a majority of Bogleheads (at least those who participated in the s...
by willthrill81
Sun May 20, 2018 9:47 pm
Forum: Investing - Theory, News & General
Topic: Buffett says Bonds are a terrible investment now. What should we invest in besides stocks?
Replies: 76
Views: 9436

Re: Buffett says Bonds are a terrible investment now. What should we invest in besides stocks?

The scariest scenario for someone retiring today would be that real interest rates would not go up over the next thirty years and investors would be stuck with safe fixed income yielding less than 1% real, the real yield on recent 30 year TIPS, which is the correct reference for the risk free asset...
by willthrill81
Sun May 20, 2018 9:44 pm
Forum: Investing - Theory, News & General
Topic: The Millionaire Next Door and civil servants
Replies: 82
Views: 11635

Re: The Millionaire Next Door and civil servants

Perhaps the "Millionaire Next Door" series continues to be popular because of the allure of the spirit of entrepreneurship. I have always found it very interesting that many of the millionaires Stanley studied believe that there was a definite element of 'being in the right place at the right time'...
by willthrill81
Sun May 20, 2018 4:00 pm
Forum: Investing - Theory, News & General
Topic: Buffett says Bonds are a terrible investment now. What should we invest in besides stocks?
Replies: 76
Views: 9436

Re: Buffett says Bonds are a terrible investment now. What should we invest in besides stocks?

Buffet says that bonds are a terrible investment. I can agree with that. He does NOT say don't buy bonds. Berkshire owns a lot of short term high quality "bonds" (debt instruments-many of which retail investors do not have access to). This provides liquidity for future opportunities that Buffet doe...
by willthrill81
Sun May 20, 2018 10:43 am
Forum: Investing - Theory, News & General
Topic: Why do so many people quote "You will likely be in a lower tax bracket in retirement"
Replies: 436
Views: 21718

Re: Why do so many people quote "You will likely be in a lower tax bracket in retirement"

Someone that has enough Social Security and an inflation-adjusted pension, for instance, that will put them back into the same tax bracket as they are now will most likely be better off with the Roth. If the marginal tax rate of contribution is the same as the marginal tax rate of withdrawal, then ...
by willthrill81
Sat May 19, 2018 10:40 pm
Forum: Investing - Theory, News & General
Topic: "Why 97% of People Don't Use 529 College Savings Plans."
Replies: 262
Views: 47170

Re: "Why 97% of People Don't Use 529 College Savings Plans."

i was unaware that government employees had so much tax advantaged space.... in the private sector all we get is the 401k ($18,500) + IRA ($5500) + HSA ($6900) = $30,900. and even then, the HSA may not be available to some, so really, the majority of americans only get $24k space each year. certain...
by willthrill81
Sat May 19, 2018 10:25 pm
Forum: Investing - Theory, News & General
Topic: Why do so many people quote "You will likely be in a lower tax bracket in retirement"
Replies: 436
Views: 21718

Re: Why do so many people quote "You will likely be in a lower tax bracket in retirement"

Can you give some reasonable example where ROTH wins and does not depend upon very unlikely conditions? Obviously apart from brain-surgeon-in-residence cases? :-) Seriously, I am hard pressed to come up with other scenario. We just had somebody do the calculations to come up with once you go over "...
by willthrill81
Sat May 19, 2018 8:43 pm
Forum: Investing - Theory, News & General
Topic: Why do so many people quote "You will likely be in a lower tax bracket in retirement"
Replies: 436
Views: 21718

Re: Why do so many people quote "You will likely be in a lower tax bracket in retirement"

Can you give some reasonable example where ROTH wins and does not depend upon very unlikely conditions? Obviously apart from brain-surgeon-in-residence cases? :-) Seriously, I am hard pressed to come up with other scenario. We just had somebody do the calculations to come up with once you go over "...
by willthrill81
Sat May 19, 2018 8:30 pm
Forum: Investing - Theory, News & General
Topic: "Why 97% of People Don't Use 529 College Savings Plans."
Replies: 262
Views: 47170

Re: "Why 97% of People Don't Use 529 College Savings Plans."

These discussions about the need to max retirement accounts tend not to notice that some people have a lot of tax deferred space. We could contribute over $130k annually to tax deferred and tax free between the IRA, 401a, 403b, 457, and HSA. We don't need all of that, and will probably never hit th...
by willthrill81
Sat May 19, 2018 5:17 pm
Forum: Investing - Theory, News & General
Topic: "Why 97% of People Don't Use 529 College Savings Plans."
Replies: 262
Views: 47170

Re: "Why 97% of People Don't Use 529 College Savings Plans."

One should not borrow from a loan shark to put money in a 529 either. You guys are doing a great job knocking down straw men. I don't see too many people advocating for 529 contributions in these types of scenarios. While people aren't advocating for it here, I absolutely here people on these call-...
by willthrill81
Sat May 19, 2018 4:13 pm
Forum: Investing - Theory, News & General
Topic: "Why 97% of People Don't Use 529 College Savings Plans."
Replies: 262
Views: 47170

Re: "Why 97% of People Don't Use 529 College Savings Plans."

Please be careful not to derail this thread and get it locked with conjecture about the future of higher education.
by willthrill81
Sat May 19, 2018 3:59 pm
Forum: Investing - Theory, News & General
Topic: Why do so many people quote "You will likely be in a lower tax bracket in retirement"
Replies: 436
Views: 21718

Re: Why do so many people quote "You will likely be in a lower tax bracket in retirement"

3) You can get all of those things when you do Roth conversion of your Trad. 401K at lower tax rate. I don't give a flip about the rate. Let's say I have 1.5 million in my R401k and you have 1.5 in your T401k. It costs me 0 to stuff that into a RIRA, and it costs you something like 500k (I didn't d...