Bogleheads.org

FrugalProfessor

https://fred.stlouisfed.org/series/MORTGAGE5US
https://fred.stlouisfed.org/series/MORTGAGE15US
https://fred.stlouisfed.org/series/MORTGAGE30US

FrugalProfessor

It sounds like you are assuming that a person has an ongoing balance in an after-tax account. For many approaching retirement or retired early, the vast majority of assets are in: a) tIRA b) Roth IRA c) HSA I will suggest that taking a dollar out of an HSA in this scenario results in one additional...

FrugalProfessor

If you have low healthcare expenses, the benefit to saving decades of expenses is trivial and likely not worth the hassle of saving receipts. In contrast, if you hemorrhage money on healthcare every year like I do, then saving receipts can make a difference. I wrote a blog post investing this issue ...

FrugalProfessor

In regards to Roth conversions... If I convert my personal IRA to Roth, I would still need to take withdrawals from the accounts for spending money now and pay tax on the withdrawals. Would you suggest I use my brokerage account first? I'm sorry to hear about your situation. I agree that you're in ...

FrugalProfessor

I "loaned" $10k over 10Y ago to a brother-in-law who is now a podiatrist making >$150k/year. When I asked to be repaid recently, his wife essentially called me the devil. I will never see that money again and the relationship is forever damaged. I'd strongly advise against making the loan....

FrugalProfessor

In that case, they shouldn't require any rebalancing at all once purchased. You just have to sit back and watch the decades-long underperformance of foreign equities, while every expected returns model says they will outperform. :twisted: This is painfully true! My target allocation is 70% domestic...

FrugalProfessor

$100k/yr tax free income in the US. More with kids:
https://frugalprofessor.com/5-kids-1698 ... e-0-taxes/

FrugalProfessor

I agree with your premise. 0/100 is not good enough: https://www.early-retirement.org/forums/members/35183-albums227-picture2326.jpg 100/0 is tempting and not that much more volatile than 0/100: https://www.early-retirement.org/forums/members/35183-albums227-picture2327.jpg I picked 50/50 because o...

FrugalProfessor

So bonds ironically provide "safety" by guaranteeing you a negative real return over the coming decade. The coming decade? It is guaranteed? Well, I guess I better sell my bond holdings. I can indeed guarantee you that if you invest in treasuries today and hold them to maturity, you'll ma...

FrugalProfessor

If there is no perfect asset allocation, and the two largest asset classes are stocks and bonds, why not just use a 50/50 portfolio and forget about all that theoretical stuff? I can answer the question if you tell me what you believe is the reason for me to have 50% of my portfolio in bonds. The a...

FrugalProfessor

Same here (5% phase out region x 2 stimulus = 10% increase in MTR).

I'm used to wonky tax code implications so I realized this the moment I read about the first stimulus.

The tax code is riddled with nonsense once you peek under the hood a bit.

FrugalProfessor

Why does anyone use billpay? My Fido CC bill is auto drafted from my CMA. All my other bills autopay on the Fido CC. I have bills that require a convenience fee if paid by credit card. I never autopay utilities or credit cards. Too many double debits and other errors over the years. I do have credi...

FrugalProfessor

I heard a story maybe here or from a friend, can't remember now, but I will paraphrase. Child: "Are we rich?" Parent: "mom and dad have money, but you are piss poor." This reminds me of an old Bill Cosby show bit ( :oops: I know, I know, but it's still funny to me.) Daughter: &q...

FrugalProfessor

I’d invest in a taxable account after all tax advantage accounts are fully funded. That includes $58k to the mega backdoor Roth IRA. +1. That is what I do. I contribute to 401k+mega backdoor Roth, Roth IRA, and HSA before taxable. I am lucky enough to be able to save enough to max all these out and...

FrugalProfessor

Swimmer wrote: ↑Thu Feb 06, 2020 2:48 pm Is there any reason I should not use FreeTaxUSA (I don’t have a back donor Roth)?

There is no reason not to use it. I've used it for years thanks to the recommendation of other forum members and it is fantastic. It handles backdoor roth contributions very well.

FrugalProfessor

A related question: do you withhold taxes for the conversion? I thought you weren't supposed to but it won't let me pay them now... Any help would be greatly appreciated. You owe taxes on any interest earned before you convert the non-deductible traditional IRA contribution. If you do the conversio...

FrugalProfessor

For a start, I would not say “that an index only menu is the only logical conclusion” even if you believed it. The brokerage windows that our family have been offered have always had additional costs, could not be automated, or had some other drawback. I like the approach taken by the current emplo...

FrugalProfessor

If a plan has a low-cost brokerage window, I would not be too concerned about the plan menu. I don't mind logging in to trade now and then. My dream plan would offer access to a fully liquid stable value fund that has a nice (>2% now) yield without taking a lot of risks, and low-cost funds that pro...

FrugalProfessor

OP instead of going on an index fund crusade, would it be better to go on a BrokerageLink crusade (if you're using Fidelity). That way you get access to basically all the ETFs. I think this is a sensible point. The initial purpose of this post was to see if some sort of bogleheads-approved consensu...

FrugalProfessor

If explicitly, is it $/head or %? An employer like the University of Washington might have an administrative fee or wrap fee of around 0.035%, the University of Vermont around 0.038%, Iowa State around 0.06%, Eastern Michigan around 0.085%, and Saginaw Valley State around 0.13%. Thanks for the info...

FrugalProfessor

Give people choice, don't make decisions for them. I am paying 0.9% expense ratio on a fidelity fund but I made 40% on it two years in a row. Total market fund returned only 16%. To me 40% -0.9% is better than 16% - 0.01% but I'm no common core math wiz. Congrats on your fund-picking success! The t...

FrugalProfessor

I do not agree that a 401k plan should be passive only and in fact I think it is reckless at best. It is a fantasy that outside the Bogleheads bubble that everyone believes that passive is better than active. A 40qk should offer both options. The actively managed fund industry agrees with your asse...

FrugalProfessor

I am one of the administrators on our plan. The primary focus when developing and maintaining the investment fund lineup is fiduciary responsibility. In layman's terms, that essentially means pleasing everybody with reasonable investment choices that are in the best interests of the participants. I...

FrugalProfessor

duplicate post

FrugalProfessor

I do not agree that a 401k plan should be passive only and in fact I think it is reckless at best. It is a fantasy that outside the Bogleheads bubble that everyone believes that passive is better than active. A 40qk should offer both options. The actively managed fund industry agrees with your asse...

FrugalProfessor

to avoid tilting at windmills here - a good plan is the plan that involves low cost options in expense fees. Plan could include both active and passive funds. - a consulting/advice should not be bundled but instead available as additional charge(s) for those you need that. This way people who do no...

FrugalProfessor

Is it a 401(k) or a 403(b) plan? I'm not sure if different regulations might apply. Personally I'd just push for the target dates funds to be switched to index funds, as opposed to eliminating the possibility to invest in an active fund if one wants to. Remember that Vanguard has plenty of low-expe...

FrugalProfessor

Active versus passive is more of a religious war. And OP, you are going to lose that war when you get outside of the friendly confines of Bogleland. Just looking at the Fidelity Freedom funds you mentioned - pretty much every one of the more expensive, actively managed funds has outperformed its in...

FrugalProfessor

If I see low-cost funds that provide exposure to the types of assets I want to own, I'm happy as a participant. I wouldn't get hung up on active versus passive as long as costs are low. Low costs clearly benefit participants and you can't walk very far without tripping over evidence of this. Active...

FrugalProfessor

to avoid tilting at windmills here - a good plan is the plan that involves low cost options in expense fees. Plan could include both active and passive funds. - a consulting/advice should not be bundled but instead available as additional charge(s) for those you need that. This way people who do no...

FrugalProfessor

My university is in the process of auditing their retirement plans. I think a likely outcome of this audit is that our menu and recordkeeping fee structure will be drastically changed. With 191 fund offered on our current Fidelity menu (including actively managed funds with ER's as high as 1.31% and...

FrugalProfessor

I looked back at my records from 2020 and I was able to transfer from my taxable Fidelity account to my Fidelity Traditional IRA and then to my Fidelity Roth IRA all on the first business day of the year, January 2, 2020. I was also able to invest those funds immediately with a mutual fund purchase...

FrugalProfessor

I had the problem with attempting the conversion immediately after my TradIRA contribution. the menus got me through the process with all options... but the last screen was missing the "Do It" button for execution. I got through to customer service, and they indicated that the holiday and...

FrugalProfessor

It does not work for me. I just tried it Like you said it gets hang up at the last step If you get through to them please share what do you learn and thank you in advance Bummer. I was hoping someone here had an easy fix that could save me from spending an eternity on hold with CS. I'll do my best ...

FrugalProfessor

It does not work for me. I just tried it Like you said it gets hang up at the last step If you get through to them please share what do you learn and thank you in advance Bummer. I was hoping someone here had an easy fix that could save me from spending an eternity on hold with CS. I'll do my best ...

FrugalProfessor

Thank you for these. Have built my own NW sheet using your ideas! Just a quick question RE the NW tracking sheet. In the annual cost of living section under housing (row 130) the housing costs do not include mortgage principal but only the interest. Why? I understand that only the interest impacts ...

FrugalProfessor

Resurrecting an old thread.... Is anyone having a Trad=>Roth conversion problem at Fidelity this year (in Jan 2021)? In prior years, I have been able to instantly convert from Trad to Roth, albeit with the caveat mentioned above that it only worked without hiccup with the "partial" convers...

FrugalProfessor

Storm clouds are on the horizon: https://www.doctorofcredit.com/survey-b ... -5-25-etc/

FrugalProfessor

Didn't read the whole thread, but I saw something about nested IF's and got excited. Here's one from my tax calculator that calculates a baseline tax liability before I make more sophisticated adjustments: =IF([@[Taxable Income]]<=0,0,IF([@[Taxable Income]]<$G$24,$H$24*[@[Taxable Income]],IF([@[Taxa...

FrugalProfessor

Excel. Helps me a lot. I aggressively manage cash flow to never have more than a grand of cash rotting away.

FrugalProfessor

Bonuses are where the money can be made. Hit Capital One and Chase first because they won't open anything for you once your credit report starts to rack up recent accounts. AmEx and Citi don't mind if you've been around the block. As far as everyday spend, you won't go far wrong with the BoA system...

FrugalProfessor

Quick summary is that BoA sent out a survey asking about potential changes to the Preferred Rewards program, and one proposed change is to reduce the Platinum Honors multiplier from 1.75x to 1.5x. That means that Cash Rewards categories could fall from 5.25% to 4.5%, and Premium Rewards cashback on...

FrugalProfessor

Has anyone else heard whether BofA is reducing their preferred rewards program? https://www.doctorofcredit.com/survey-bank-of-america-might-eliminate-75-platinum-honors-bonus-2-62-5-25-etc/ Quick summary is that BoA sent out a survey asking about potential changes to the Preferred Rewards program, ...

FrugalProfessor

pingpong, how long do you expect to be at this job? Do you have any side income? If yes, you might be able to open a Solo 401k and roll the pre-tax portion of your tIRA into the Solo 401k. I am hoping to move within the next couple of years. Again, I do not know how the new employer's plan will be....

FrugalProfessor

Give FreetaxUSA a shot. . If you have experience doing your own taxes and all forms are covered I would not bother paying for premium. There is probably a way to upgrade during the process if you get stuck. +1 i use taxhawk, which is the same company. i used to use taxact when they were cheaper. th...

FrugalProfessor

No gifts for us. Gifts have never made sense to me.

If I want something more than money, I buy it. If not, I don't. Therefore, if I don't already own something, I've demonstrated through my actions that I prefer the equivalent amount of money.

FrugalProfessor

I've used FreeTaxUSA since 2016, thanks to the suggestion in this forum. Prior to that I was with Turbotax for a decade. I'll never go back to TurboTax. FreeTaxUSA is free for federal and very reasonably priced for state. E-filings included. From what I can tell, it handles self-employment stuff eas...

FrugalProfessor

1.) CC rewards (pretty trivial, but what's not to like about a free 2.625%) 2.) Less taxes (and consequently, more wealth) I wrote a blog post to quantify #2 here: https://frugalprofessor.com/paying-out-of-pocket-for-healthcare-rather-than-raiding-your-hsa/ It's not as big of a benefit as I would ha...

FrugalProfessor

Here is the best but most complex plan I can think of: Hold the chase sapphire reserve for the 1.5% return on points. Groceries: Chase flex for 7.5% back for the next year Amazon: chase ink amazon gift cards bought at Office Depot 7.5% Flights: chase flex for 7.5% When booked from chase portal buyi...

FrugalProfessor

One of my AC systems died a couple months ago. It was 18 years old, so I guess I shouldn't have been surprised. I'm a cheapskate (probably the understatement of the century). I opted to replace both HVAC systems for $11.5k because we were given a modest pricing discount to do them both. The main uni...

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