Search found 4909 matches

by stlutz
Wed Jan 16, 2019 12:24 am
Forum: Investing - Theory, News & General
Topic: An Annuity Hater Revisits SPIAs
Replies: 21
Views: 2324

Re: An Annuity Hater Revisits SPIAs

It’s very expensive to insure against high inflation and a long life. How much is that in numbers? An inflation-adjusted annuity is likely to pay out a much larger number of dollars than a level-payment annuity. Why wouldn't you expect it to be more expensive? People complain that one kind of SPIA ...
by stlutz
Sat Jan 12, 2019 6:56 pm
Forum: Investing - Theory, News & General
Topic: [Vanguard to stop accepting purchases in Leveraged or Inverse mutual funds]
Replies: 145
Views: 8344

Re: [Vanguard to stop accepting purchases in Leveraged or Inverse mutual funds]

If one wants leverage isn't it cheaper to get it via futures anyhow?
by stlutz
Thu Jan 10, 2019 10:41 pm
Forum: Personal Finance (Not Investing)
Topic: Fidelity Cash Management Account - Investments
Replies: 15
Views: 1077

Re: Fidelity Cash Management Account - Investments

You need a regular brokerage account and have all of your deposits go into there. You can then setup cash manager to automagically pull from that when you need cash in the CMA. Or what I do is use the regular brokerage account for everything except ATM withdrawals. That approach limits my risk in th...
by stlutz
Wed Jan 09, 2019 8:34 pm
Forum: Personal Finance (Not Investing)
Topic: Diagnosing Knee Problems over the Phone - Medicare
Replies: 119
Views: 5009

Re: Diagnosing Knee Problems over the Phone - Medicare

Thanks again to everyone for their helpful advice, as always. I certainly learned some things. This issue is now resolved as I just got a call from the orthopedist's office that they will accept my wife as a patient. We set up two appointments, one for xrays and another for the initial consultation...
by stlutz
Sun Jan 06, 2019 9:27 pm
Forum: Personal Finance (Not Investing)
Topic: Are we at "Peak FI"?
Replies: 93
Views: 9842

Re: Are we at "Peak FI"?

I think u.s. is already past previous debt levels before the last financial crisis. (Don't quote me.)
Not really.

https://fred.stlouisfed.org/series/TDSP
by stlutz
Sun Jan 06, 2019 4:38 pm
Forum: Personal Finance (Not Investing)
Topic: Are we at "Peak FI"?
Replies: 93
Views: 9842

Re: Are we at "Peak FI"?

I've never heard the phrase used anywhere except on the internet.

For decades some people have been well off and retired early. I expect that to continue in the future.
by stlutz
Sun Jan 06, 2019 2:21 pm
Forum: Investing - Theory, News & General
Topic: How do you view a savings surplus in retirement?
Replies: 117
Views: 5911

Re: How do you view a savings surplus in retirement?

Another option is to view it as money to be given away--to charity, to the kids/grandkids, whatever.
by stlutz
Sun Jan 06, 2019 12:27 pm
Forum: Investing - Theory, News & General
Topic: Long bonds and duration risk and market efficiency
Replies: 47
Views: 2185

Re: Long bonds and duration risk and market efficiency

I see how these factors hedge against each other but honestly, I don't quite follow that they cancel out. If I have a 10 year horizon, invest 10 dollars in a 10 year bond that gives 10% and the following year rates double (20%) and stay like that for the next 9 years, then I will get 10% yield coup...
by stlutz
Sun Jan 06, 2019 12:17 pm
Forum: Investing - Theory, News & General
Topic: Long bonds and duration risk and market efficiency
Replies: 47
Views: 2185

Re: Long bonds and duration risk and market efficiency

I don't understand why the Treasury yield curve is inverted right now but the VG treasury index funds are not inverted
The Treasury yield curve is not inverted currently. (except between 2 and 3 years maturities).
by stlutz
Sun Jan 06, 2019 12:49 am
Forum: Investing - Help with Personal Investments
Topic: I now have a lot more traditional than Roth. Should I shift into Roth 401K ?
Replies: 47
Views: 2098

Re: I now have a lot more traditional than Roth. Should I shift into Roth 401K ?

I would suggest taking a look at what the US tax system looked like 40 years ago (e.g. in 1978). These threads that run the numbers on what the after-tax effect would be of various approaches all make the absurd assumption that taxes won't be significantly different 40 years from now. Not a little d...
by stlutz
Sat Jan 05, 2019 11:20 pm
Forum: Personal Finance (Not Investing)
Topic: $40,000 in debt, bankruptcy seems to be the best option right now
Replies: 258
Views: 20165

Re: $40,000 in debt, bankruptcy seems to be the best option right now

(seriously, live like a broke college student and do rice, beans, ramen) Okay, I'm posting too much in this thread so I'll stop after this, but it always bugs when when adopting poor nutrition habits is recommended as a solution to financial problems. There are lot of cars and houses out there; you...
by stlutz
Sat Jan 05, 2019 11:16 pm
Forum: Personal Finance (Not Investing)
Topic: $40,000 in debt, bankruptcy seems to be the best option right now
Replies: 258
Views: 20165

Re: $40,000 in debt, bankruptcy seems to be the best option right now

And just to clarify my point--obviously something went awry at some point to end up with $40K in CC debt. I agree with the other comments about that. I also agree that all people, not just people in the OP's situation, benefit from periodically going through their expenses and axing things that add ...
by stlutz
Sat Jan 05, 2019 11:05 pm
Forum: Personal Finance (Not Investing)
Topic: $40,000 in debt, bankruptcy seems to be the best option right now
Replies: 258
Views: 20165

Re: $40,000 in debt, bankruptcy seems to be the best option right now

Assume the credit card debt didn't exist but the OP had $3600/mo. in after tax income. What should the mortgage payment and the car payment be?
by stlutz
Sat Jan 05, 2019 10:56 pm
Forum: Investing - Theory, News & General
Topic: Long bonds and duration risk and market efficiency
Replies: 47
Views: 2185

Re: Long bonds and duration risk and market efficiency

I have basically a couple of days before I have to make this decision :?: One of the most valuable things I learned on this forum was a word nisiprius used: "satisficing". That is, selecting the first option that meets a given need or select the option that seems to address most needs rather than t...
by stlutz
Sat Jan 05, 2019 10:50 pm
Forum: Personal Finance (Not Investing)
Topic: $40,000 in debt, bankruptcy seems to be the best option right now
Replies: 258
Views: 20165

Re: $40,000 in debt, bankruptcy seems to be the best option right now

Escrow (Taxes & Insurance) $533.83
Ahhhh.... got it. I was only considering P&I.
by stlutz
Sat Jan 05, 2019 10:48 pm
Forum: Personal Finance (Not Investing)
Topic: $40,000 in debt, bankruptcy seems to be the best option right now
Replies: 258
Views: 20165

Re: $40,000 in debt, bankruptcy seems to be the best option right now

I know the area well. Crime is high, which is extremely unfortunate. Security systems and living in a good area are important. Again, looking at stats, violent crime in Broward County is about the same as Denver (not generally considered a high crime city as far as I know) and is half that of Detro...
by stlutz
Sat Jan 05, 2019 10:24 pm
Forum: Investing - Help with Personal Investments
Topic: Tbills for the tbill challenged
Replies: 13
Views: 1240

Re: Tbills for the tbill challenged

what happens if I sell before maturity? Is there penalty? There is no penalty. However, there is a small trading spread between what you would buy one for and what you would sell it for. One should not fear selling if you needed the money, but you will take a small (e.g. .1%) hit. IMO, Fidelity is ...
by stlutz
Sat Jan 05, 2019 10:16 pm
Forum: Personal Finance (Not Investing)
Topic: $40,000 in debt, bankruptcy seems to be the best option right now
Replies: 258
Views: 20165

Re: $40,000 in debt, bankruptcy seems to be the best option right now

I don't live anywhere close to Florida, but the median home price in Broward County is $263,000 according to a quick Google search. That should equate to a mortgage payment of about $1270/month. I agree with the OP that switching to renting probably doesn't help, but it seems like either getting int...
by stlutz
Sat Jan 05, 2019 9:33 pm
Forum: Investing - Theory, News & General
Topic: Do bond funds try to avoid capital gains? especially in Tax Exempt?
Replies: 5
Views: 401

Re: Do bond funds try to avoid capital gains? especially in Tax Exempt?

Trading costs in the muni market are high, so they can't really afford to trade a lot. VWIUX (IT Tax Exempt) generally have a turnover rate in the 10-15% range, which is very close to buy and hold. Contrast that with Vanguard's actively managed Treasury funds which generally have turnover in the 100...
by stlutz
Sat Jan 05, 2019 8:01 pm
Forum: Personal Consumer Issues
Topic: Windows 10 / Office 2019 headache
Replies: 24
Views: 1575

Re: Windows 10 / Office 2019 headache

Windows 10 is such an improvement over prior versions of Windows in terms of overall stability. Just upgrade your OS.
by stlutz
Sat Jan 05, 2019 7:54 pm
Forum: Investing - Help with Personal Investments
Topic: VWIUX vs VWLUX
Replies: 7
Views: 872

Re: VWIUX vs VWLUX

Here is a good example of how the two differed when interest rates had a significant runup back in 2013:

https://thefinancebuff.com/vanguard-lon ... nds-2.html
by stlutz
Sat Jan 05, 2019 9:11 am
Forum: Investing - Help with Personal Investments
Topic: VWIUX vs VWLUX
Replies: 7
Views: 872

Re: VWIUX vs VWLUX

Duration is the time left on the bond. Let's say there is a 20-year bond issued in 2005 held by your bond fund. Today in 2019, it has a 6-year duration. That's not correct. Maturity is the time left on the bond. Duration is the average amount of time from which cash flows are distributed by the bon...
by stlutz
Sat Jan 05, 2019 1:06 am
Forum: Investing - Theory, News & General
Topic: Long bonds and duration risk and market efficiency
Replies: 47
Views: 2185

Re: Long bonds and duration risk and market efficiency

Is this a simplistic but ultimately an effective way of investing in bonds? Just for the sake of creating confusion, :D , how certain are you that your horizon is actually 30 years? Everybody talks about investing for retirement, but the fact is that we all invest for a variety of goals--some short...
by stlutz
Sat Jan 05, 2019 12:38 am
Forum: Investing - Help with Personal Investments
Topic: BAM Advisor: Advice on alt funds and allocations
Replies: 54
Views: 2597

Re: BAM Advisor: Advice on alt funds and allocations

OP: The question of what posters here do with their own portfolios is irrelevant to your portfolio. I have two questions: 1) Where do you rank yourself on a continuum between: "I am willing to take a significant amount of risk to obtain higher returns with the knowledge that such risk could result i...
by stlutz
Sat Jan 05, 2019 12:11 am
Forum: Investing - Theory, News & General
Topic: Long bonds and duration risk and market efficiency
Replies: 47
Views: 2185

Re: Long bonds and duration risk and market efficiency

I will buy a bond fund so not sure how ¨holding bonds to maturity¨ applies to me but it´s not quite clear how if my investment horizon is 30 years, then duration risk does not affect me. I could buy a 30 year bond, rates could double tomorrow, and I have effectively ¨lost¨all this money I could mak...
by stlutz
Sat Jan 05, 2019 12:02 am
Forum: Investing - Help with Personal Investments
Topic: HY Muni fund in taxable?
Replies: 11
Views: 816

Re: HY Muni fund in taxable?

This "high yield" fund is overwhelmingly weighted in A and BBB-rated bonds, which are investment grade. They have dabbling in junk bonds. Morningstar rates it's average quality as BBB, which takes into the account the fact the growth in default risk as you go down rating categories is non-linear. In...
by stlutz
Fri Jan 04, 2019 11:56 pm
Forum: Investing - Theory, News & General
Topic: US Stock Market Returns in the 21st Century
Replies: 92
Views: 4355

Re: US Stock Market Returns in the 21st Century

Everybody is talking about changing in years. Change the end date to 9/30/2018 and the US stock return is 1%/yr. higher.
by stlutz
Fri Jan 04, 2019 11:12 pm
Forum: Investing - Help with Personal Investments
Topic: CDs vs I Bonds - Five and Ten Year Horizons
Replies: 12
Views: 1073

Re: CDs vs I Bonds - Five and Ten Year Horizons

To offer a serious answer, I would instead use an S&P 500 index fund. It offers a lot of teachable moments as they grow older and the S&P 500 will become something they can come to connect with something they own.
by stlutz
Fri Jan 04, 2019 11:07 pm
Forum: Investing - Help with Personal Investments
Topic: CDs vs I Bonds - Five and Ten Year Horizons
Replies: 12
Views: 1073

Re: CDs vs I Bonds - Five and Ten Year Horizons

Tell the kids they each have to pick one. The one that picks the better performing asset gets to keep both. :twisted:
by stlutz
Fri Jan 04, 2019 11:03 pm
Forum: Investing - Theory, News & General
Topic: Long bonds and duration risk and market efficiency
Replies: 47
Views: 2185

Re: Long bonds and duration risk and market efficiency

It's also why the yield curve for municipal bonds tends to be steeper than for Treasuries. Less interest by institutional investors, and not a lot of retail investors who want to extend duration that far out. Long-term muni bonds have call risk that shorter-term munis don't. Also credit risk is a b...
by stlutz
Fri Jan 04, 2019 9:14 pm
Forum: Investing - Theory, News & General
Topic: Was it a mistake to move into PenFed 5-year CDs a year ago?
Replies: 61
Views: 8671

Re: Was it a mistake to move into PenFed 5-year CDs a year ago?

I've seen a couple of posts where people mentioned that these CDs have been maturing of late which made me think of this old thread. Just for fun, I compared the 3% of these vs. the 5 year return of Total Bond (which was the alternative most were discussing for comparison purposes). As of 12/31/18, ...
by stlutz
Fri Jan 04, 2019 8:56 pm
Forum: Personal Finance (Not Investing)
Topic: Fidelity free Turbotax
Replies: 378
Views: 51805

Re: Fidelity free Turbotax

Hasn't it long since become clear that there are no defined requirements to receive it? Fidelity seems to have a random algorithm for giving it to certain accounts which seemingly can be overridden by certain employees but not others.
by stlutz
Fri Jan 04, 2019 8:26 pm
Forum: Investing - Theory, News & General
Topic: Long bonds and duration risk and market efficiency
Replies: 47
Views: 2185

Re: Long bonds and duration risk and market efficiency

The answer turns on what you believe the investing term efficiency means I would suggest it depends on the definition of what "adequately" means. :happy That's a value judgement. And the answer largely depends on ones expectations/fears of future inflation. If you have a high degree of fear that a ...
by stlutz
Fri Jan 04, 2019 7:47 pm
Forum: Personal Finance (Not Investing)
Topic: HRBlock Appears to be Calculating Tax Wrong 1/4/2019
Replies: 25
Views: 2149

Re: HRBlock Appears to be Calculating Tax Wrong 1/4/2019

You could also try using freetaxusa.com if you wanted to check vs. something that you don't have to pay a second time for.
by stlutz
Wed Jan 02, 2019 11:11 pm
Forum: Investing - Help with Personal Investments
Topic: Want to convert VTSAX to VTI without taking a tax hit in taxable account
Replies: 8
Views: 676

Re: Want to convert VTSAX to VTI without taking a tax hit in taxable account

Chase charges $0 for mutual fund trades (https://www.chase.com/content/dam/chase-ux/documents/personal/investments/youinvest_trade_fee_commish_schedule.pdf). Assuming they will let you buy *some* type of Vanguard fund, they should very shortly allow you to purchase VTSAX since VG is eliminating inve...
by stlutz
Wed Jan 02, 2019 9:05 pm
Forum: Investing - Help with Personal Investments
Topic: CPA suggesting I don't contribute max to 401k this year?
Replies: 38
Views: 5259

Re: CPA suggesting I don't contribute max to 401k this year?

Calculating what the benefit/cost might be is pointless as you have no idea what tax rates/policy will be in 40 years when you are withdrawing the money. Considerations you might have: --what does your balance between pre-tax, Roth, and post-tax investments look like? Being overly concentrated in on...
by stlutz
Tue Jan 01, 2019 5:34 pm
Forum: Investing - Theory, News & General
Topic: Different times for cash to settle at fidelity?
Replies: 10
Views: 587

Re: Different times for cash to settle at fidelity?

Interesting. Did the money come from the same bank?
by stlutz
Tue Jan 01, 2019 2:23 pm
Forum: Investing - Help with Personal Investments
Topic: Sell ETF, buy Vanguard mutual fund on same day
Replies: 14
Views: 1130

Re: Sell ETF, buy Vanguard mutual fund on same day

Being risk-averse, I don't like to rely on my broker being nice to me. I personally would either apply for margin or follow the actual rules. To limit the risk of being out of the market on a day it goes up 5% in the later scenario, I'd spread my transactions out over time. It’s not “against the ru...
by stlutz
Tue Jan 01, 2019 1:35 pm
Forum: Investing - Help with Personal Investments
Topic: Sell ETF, buy Vanguard mutual fund on same day
Replies: 14
Views: 1130

Re: Sell ETF, buy Vanguard mutual fund on same day

Do you have a cash account or a margin account? From a Vanguard Brokerage perspective, this is what is happening: The mutual fund buy you place on 1/2 settles the same day. They need to come up with the money to give to the fund that day. The ETF sale settles on T+2, or on 1/4. So, they don't receiv...
by stlutz
Tue Jan 01, 2019 1:17 pm
Forum: Investing - Theory, News & General
Topic: The Intelligent Investor
Replies: 16
Views: 1376

Re: The Intelligent Investor

There is still room in today's markets for "enterprising investors". Keep in mind that the enterprising investor in Graham's categorization primarily relates to the effort one can put into it. That effort (and the expense it entails) today is much larger than it used to be. Back when the book was wr...
by stlutz
Tue Jan 01, 2019 11:55 am
Forum: Investing - Theory, News & General
Topic: Growth (Nominal) & Inflation Projections
Replies: 19
Views: 803

Re: Growth (Nominal) & Inflation Projections

Also keep in mind that during the distribution phase the sequence of equity returns is also very important. You can have a decent average return but if all of the bad years come at the beginning you have a problem.

In short, don't just plug the average return into your spreadsheet.
by stlutz
Tue Jan 01, 2019 11:51 am
Forum: Investing - Theory, News & General
Topic: Growth (Nominal) & Inflation Projections
Replies: 19
Views: 803

Re: Growth (Nominal) & Inflation Projections

30 year TIPS yield about 1% so that what I'd go with for bonds. Historically global equites have returned about 4% more than bonds, so 5% real for equities.
by stlutz
Tue Jan 01, 2019 1:02 am
Forum: Investing - Theory, News & General
Topic: Risks of secondary muni bonds?
Replies: 15
Views: 638

Re: Risks of secondary muni bonds?

roughly 5-year horizon To me this cries out for using a fund. When your tax situation changes, it's one transaction to move to something more tax-appropriate if need be. Because of the costs and difficulty of selling individual munis, you should plan to be in for the duration. I think this is the w...
by stlutz
Mon Dec 31, 2018 9:13 pm
Forum: Investing - Help with Personal Investments
Topic: Small Cap Value options for fidelity brokerage link (mutual fund only)
Replies: 34
Views: 2725

Re: Small Cap Value options for fidelity brokerage link (mutual fund only)

And of course down the road when one sells this fund, there would be a $75 fee. They only charge for buys; not sells. oh yea? that's good to know, in talking w/ the rep it sounded like there would be a cost to sell down the road. Guess it would be nice if there wasn't. Just passing along the info f...
by stlutz
Mon Dec 31, 2018 9:10 pm
Forum: Investing - Theory, News & General
Topic: Annuities objectively considered
Replies: 111
Views: 7278

Re: Annuities objectively considered

I'm curious about purchasing a Deferred Income Annuity at a younger age? I can put $100k in a DIA at age 35 and receive $35k per year starting at age 70 with a $100k cash refund....if I fund it with a Roth IRA, then I suppose the annuity payments aren't taxable? That's a pretty sweet income floor t...
by stlutz
Mon Dec 31, 2018 6:34 pm
Forum: Investing - Theory, News & General
Topic: Risks of secondary muni bonds?
Replies: 15
Views: 638

Re: Risks of secondary muni bonds?

Usually at the top of of the yield range on a muni bond search are bonds from Illinois. These bonds all have a premium due to that state's pension situation--it's dramatically underfunded and the state constitution doesn't allow for any changes to it. As such, bond holders bear all of the default ri...
by stlutz
Mon Dec 31, 2018 2:13 pm
Forum: Investing - Help with Personal Investments
Topic: Small Cap Value options for fidelity brokerage link (mutual fund only)
Replies: 34
Views: 2725

Re: Small Cap Value options for fidelity brokerage link (mutual fund only)

And of course down the road when one sells this fund, there would be a $75 fee.
They only charge for buys; not sells.
by stlutz
Sun Dec 30, 2018 11:55 am
Forum: Personal Consumer Issues
Topic: E-mail from "VANGUARD MONEY MARKET RESERVES INC." - Phishing?
Replies: 15
Views: 1648

Re: E-mail from "VANGUARD MONEY MARKET RESERVES INC." - Phishing?

Looking at the dates on EDGAR (clickable link below. :D ), the e-mail was prompted by the filing of a new summary prospectus.

https://www.sec.gov/cgi-bin/browse-edga ... e&count=40
by stlutz
Sat Dec 29, 2018 10:44 pm
Forum: Investing - Theory, News & General
Topic: Who pays the capital gains tax on ETF assets?
Replies: 37
Views: 2295

Re: Who pays the capital gains tax on ETF assets?

When a mutual fund makes a distribution, the price declines by the amount of the distribution. Suppose you buy a fund at $10, and the fund's price goes up to $15. It makes a $1 distribution. The price drops to $14. Suppose there is no price change before I sell the following year. So, this year I pa...