Search found 244 matches

by ThrustVectoring
Thu Nov 23, 2017 1:00 am
Forum: Investing - Help with Personal Investments
Topic: New Roth IRA @Vanguard, 80/20, which funds to choose?
Replies: 14
Views: 774

Re: New Roth IRA @Vanguard, 80/20, which funds to choose?

So invest everything into the total stock market until your account hits $15k, at which point you move $3000 from the stock market to open the bond fund. +1 Being off your target for a couple of years doesn't matter. Yep I understand.... and I should also look at it globally not specifically at thi...
by ThrustVectoring
Wed Nov 22, 2017 6:08 pm
Forum: Investing - Help with Personal Investments
Topic: portfolio check
Replies: 6
Views: 423

Re: portfolio check

1. I have my emergency fund in Betterment. I realize this may be redundant with what I'm try to do with my retirement accounts. Should I put this money in a high yield savings account? Yes. Your emergency fund should be in cash. Fortunately, you have 5 months of expenses in cash in your high-yield ...
by ThrustVectoring
Wed Nov 22, 2017 5:33 pm
Forum: Investing - Help with Personal Investments
Topic: New Roth IRA @Vanguard, 80/20, which funds to choose?
Replies: 14
Views: 774

Re: New Roth IRA @Vanguard, 80/20, which funds to choose?

The investor grades of those funds are fine, especially since the fee difference isn't huge in absolute terms with the lower account balances. Those generally will have a minimum of $3000 at Vanguard. Buy the biggest holdings in your desired asset allocation until your total investment is large enou...
by ThrustVectoring
Tue Nov 21, 2017 2:24 pm
Forum: Investing - Theory, News & General
Topic: Dropping Term Life Insurance When Hitting Your Number
Replies: 15
Views: 1265

Re: Dropping Term Life Insurance When Hitting Your Number

Either way is fine - you've hit your number, so you can afford to either cancel it or keep it. It's likely a positive actuarial value, so you might want to keep it until expiry, especially if you've got charitable causes or heirs that you want to leave money behind for. Definitely talk to your wife ...
by ThrustVectoring
Sun Nov 19, 2017 12:27 pm
Forum: Investing - Help with Personal Investments
Topic: Confused about cash and retirement - isn't this really about market timing?
Replies: 38
Views: 2991

Re: Confused about cash and retirement - isn't this really about market timing?

Ron wrote:
Sun Nov 19, 2017 8:44 am
for the next 30 years (until age 100 :twisted: ), my projected withdraw rate is forecast to be under 2%.
You'd be fine in retirement if your plan was to literally stuff cash into your mattress.
by ThrustVectoring
Sun Nov 19, 2017 11:51 am
Forum: Investing - Help with Personal Investments
Topic: Regular 401K vs Roth 401K
Replies: 31
Views: 1766

Re: Regular 401K vs Roth 401K

..............is there a general rule of thumb that people should follow? Yes. If you will be in a lower tax bracket in retirement then you want to defer taxes on your contributions. You will pay a lower tax rate later. If you expect a higher bracket in retirement then the more Roth the better. It'...
by ThrustVectoring
Fri Nov 17, 2017 10:43 pm
Forum: Investing - Help with Personal Investments
Topic: Options? Maxed 54K 401K limit from all sources limit but couldn't max 18K 401K personal limit
Replies: 4
Views: 566

Re: Options? Maxed 54K 401K limit from all sources limit but couldn't max 18K 401K personal limit

Unless you're trying to limit your taxable income, it doesn't hurt you any. Tax-deferred contributions and mega-backdoor Roth contributions are worth the same to you. Like, you're in the same boat as making the full 18k tax-deferred contribution and converting $1000 of it to Roth, which is theoretic...
by ThrustVectoring
Fri Nov 17, 2017 10:40 pm
Forum: Investing - Help with Personal Investments
Topic: Spending Taxable to Zero during Retirement
Replies: 32
Views: 3323

Re: Spending Taxable to Zero during Retirement

The step-up in basis might be worthwhile if you have significant unrealized capital gains and are doing estate planning. Suppose you're in the 15% bracket for capital gains, your tax basis is zero, and you're deciding between spending $1000 either through selling your taxable portfolio or withdrawi...
by ThrustVectoring
Fri Nov 17, 2017 6:20 pm
Forum: Investing - Help with Personal Investments
Topic: Spending Taxable to Zero during Retirement
Replies: 32
Views: 3323

Re: Spending Taxable to Zero during Retirement

The step-up in basis might be worthwhile if you have significant unrealized capital gains and are doing estate planning. Suppose you're in the 15% bracket for capital gains, your tax basis is zero, and you're deciding between spending $1000 either through selling your taxable portfolio or withdrawin...
by ThrustVectoring
Fri Nov 17, 2017 2:30 pm
Forum: Investing - Theory, News & General
Topic: Holding VTSAX only
Replies: 46
Views: 5212

Re: Holding VTSAX only

I'd throw in a total international fund like VTIAX, but yeah, my plans are also going 100% equities for the foreseeable future. It helps a lot that I'm young (29) and early in my investing career (faffed around instead of making serious money right after college). I'm also planning on making way mor...
by ThrustVectoring
Thu Nov 16, 2017 1:01 pm
Forum: Investing - Theory, News & General
Topic: Luxury Index Funds
Replies: 12
Views: 1645

Re: Luxury Index Funds

I don't use them personally but I recommend them for my girlfriend and people who ask very basic questions and want to do the right thing.

Doing the wrong thing is far more expensive than the fees, and a lot of people I don't expect would do the right thing without using these funds.
by ThrustVectoring
Thu Nov 16, 2017 12:54 pm
Forum: Investing - Help with Personal Investments
Topic: Why pay cash for a car?
Replies: 179
Views: 14700

Re: Why pay cash for a car?

And you wouldnt take a new loan out to invest in the market now. I would, if the rate is attractive enough and I'm not taking on too much leverage. Especially since auto loans are fixed-rate and have a relatively decent term. Do note that any leverage could be "too much" if you aren't in a position...
by ThrustVectoring
Tue Nov 14, 2017 9:05 pm
Forum: Investing - Help with Personal Investments
Topic: Opinion of Total Stock Market Index
Replies: 21
Views: 2302

Re: Opinion of Total Stock Market Index

bogglesquared wrote:
Tue Nov 14, 2017 5:12 pm
I tend to trust their math and reasoning over my own desire to get greedy and make an extra .5% per year in the market
To be fair, an extra 0.5% per year is *huge* over the long run. Compounded over two decades it's an additional 10%.
by ThrustVectoring
Wed Nov 08, 2017 3:47 am
Forum: Investing - Help with Personal Investments
Topic: Annuity for winning the game
Replies: 39
Views: 3431

Re: Annuity for winning the game

2% withdrawal rate means that you can do whatever you want and it'll work. Saving 50 times your annual expenses means you could get a real return of zero and wind up with enough money to last you until you turn 113 years old. Very few people live to that age. Any non-terrible investment is fine. Wha...
by ThrustVectoring
Wed Nov 08, 2017 3:37 am
Forum: Investing - Help with Personal Investments
Topic: VOO versus VTI
Replies: 8
Views: 802

Re: VOO versus VTI

VTI is 90% VOO + 10% VXF, and correlates to a good extend accordingly. So uhh, yeah, doesn't matter. I like VTI slightly more because more stocks = probably better. VOO is probably better if you ever want to do options, just because the options market is thicker based off the S&P 500 and ETFs that t...
by ThrustVectoring
Tue Nov 07, 2017 8:18 pm
Forum: Investing - Help with Personal Investments
Topic: From 100% equity to 80/20. Overnight or over a year?
Replies: 23
Views: 1878

Re: From 100% equity to 80/20. Overnight or over a year?

What percentage of your target retirement number is funded? Alternatively, how big are your contributions compared to your amount invested? If you've got $30k invested and are contributing another $20k this year, no point in selling down. If you've got $1MM invested and are contributing another $20k...
by ThrustVectoring
Mon Nov 06, 2017 9:11 pm
Forum: Investing - Theory, News & General
Topic: Volatility and Risk relationship
Replies: 29
Views: 1974

Re: Volatility and Risk relationship

IMO if you want more risk you should be owning more of the US stock market as a whole. The percentage you have in cash or bonds is a better lever to pull. It only gets a bit tricky when your appetite for risk pushes you beyond a 100% S&P 500 portfolio, in which case it's probably better to buy some ...
by ThrustVectoring
Mon Nov 06, 2017 8:57 pm
Forum: Investing - Help with Personal Investments
Topic: Where to invest home downpayment which I am not certain when to buy if ever?!
Replies: 62
Views: 3417

Re: Where to invest home downpayment which I am not certain when to buy if ever?!

If you belong to the Boglehead's anti-house faction, then you would just have taxable stock investments for retirement savings. Later, if you are "forced" to buy a house then the down-payment would naturally come out of the stock capital gains. Does this means that the bogleheadish way to consider ...
by ThrustVectoring
Mon Nov 06, 2017 8:53 pm
Forum: Investing - Help with Personal Investments
Topic: Where to take more risk: 401k or Roth?
Replies: 32
Views: 2852

Re: Where to take more risk: 401k or Roth?

OP jumping back in. Thanks for the responses. My question is "where to put the risk?" Not "where to put the stocks?" I'm trying to inquire from more of a theoretical perspective. Or at least get an answer based on theory/math/probability. And like JBTX, I think the answer is "it doesn't matter." bu...
by ThrustVectoring
Mon Nov 06, 2017 3:31 pm
Forum: Investing - Help with Personal Investments
Topic: Match for Vanguard's VTSAX?
Replies: 1
Views: 254

Re: Match for Vanguard's VTSAX?

Yeah, those look like pretty much the same thing as far as I can tell. 3384 holdings for FSTVX vs 3626 for VTSAX, similar expense ratios and both funds are trying to own basically every US stock with price data.
by ThrustVectoring
Fri Nov 03, 2017 5:12 pm
Forum: Investing - Help with Personal Investments
Topic: I can take $15k out of my trad IRA with no taxes - should I?
Replies: 37
Views: 3295

Re: I can take $15k out of my trad IRA with no taxes - should I?

It might not be taxable because your total income is so low that it does not get up to the level of being taxed (exemptions and deductions take up some space before taxable income starts). Maybe I'm just not understanding what you are talking about. Yes - I have low "taxable" income, since I have m...
by ThrustVectoring
Thu Nov 02, 2017 6:53 pm
Forum: Investing - Help with Personal Investments
Topic: what % return do you use?
Replies: 62
Views: 4140

Re: what % return do you use?

I use different numbers for different purposes. For investment choice purposes, I expect the stock market to have a nominal return of 6%. That is, I'll automatically choose to pay down debts with a higher interest rate, etc. For retirement planning, I make sure things work with a real return of zero...
by ThrustVectoring
Wed Nov 01, 2017 10:15 pm
Forum: Investing - Help with Personal Investments
Topic: Market Crash Defensive Portfolio
Replies: 30
Views: 3585

Re: Market Crash Defensive Portfolio

If you're young, what you need to worry about is long-term risks like inflation and underperformance, not short-term risks like stock market corrections. Most of your earning power is in future paychecks , not your current investments. A correction just means you get to accumulate wealth in market c...
by ThrustVectoring
Tue Oct 31, 2017 5:34 pm
Forum: Investing - Help with Personal Investments
Topic: AA By Account or Total Portfolio? (HSA advice)
Replies: 9
Views: 671

Re: AA By Account or Total Portfolio? (HSA advice)

The flip side of having different funds in different accounts is that it complicates figuring out your after-tax effective asset allocation. If you assume your retirement tax rate is 20%, then a 50/50 allocation could have $100k in bonds in your 401(k) and $80k in stocks in your Roth IRA and be perf...
by ThrustVectoring
Tue Oct 31, 2017 3:41 pm
Forum: Investing - Help with Personal Investments
Topic: S&P 500 -- Ten Years Thoughts?
Replies: 45
Views: 5279

Re: S&P 500 -- Ten Years Thoughts?

Both funds are excellent with similar risk, return, and great tax-efficiency. Best wishes. Taylor If they are similar in risk, return and efficiency why would anyone choose SP500? the added advantage of total stock market is greater diversification. Adding on to what others are saying: the S&P 500 ...
by ThrustVectoring
Tue Oct 31, 2017 11:45 am
Forum: Investing - Help with Personal Investments
Topic: Margin balances
Replies: 4
Views: 424

Re: Margin balances

You should be asking questions about margin before using it - if you aren't very aware of the risks involved, it's easy to get burned or take out too much debt. Like, did you shop around and get a good margin rate? Do you have expectations for future market returns and volatility/risks?
by ThrustVectoring
Mon Oct 30, 2017 3:02 pm
Forum: Investing - Help with Personal Investments
Topic: What is the point of an ETF version of a total stock index fund?
Replies: 15
Views: 1074

Re: What is the point of an ETF version of a total stock index fund?

When money flows into or out of a mutual fund, the trading is done by the mutual fund and the costs of it are borne proportionally by all investors. When money flows into or out of an ETF, the trading is done by market participants who earn a small arbitrage profit. The costs of this trading are bor...
by ThrustVectoring
Sat Oct 28, 2017 12:07 pm
Forum: Investing - Help with Personal Investments
Topic: Transform stock + cash into a better portfolio
Replies: 4
Views: 240

Re: Transform stock + cash into a better portfolio

I believe US stock market is too expensive at the moment. And there's a good chance that next year, the stock market will be even more expensive. You should probably be in the market, at least with 20 or 40% of your liquid assets. I plan to go back to EU in a couple of years, buy a house and have s...
by ThrustVectoring
Thu Oct 26, 2017 1:14 pm
Forum: Investing - Help with Personal Investments
Topic: Index investing is boring
Replies: 63
Views: 5572

Re: Index investing is boring

"It's boring" is why I like index investing.
by ThrustVectoring
Tue Oct 24, 2017 4:08 pm
Forum: Investing - Help with Personal Investments
Topic: Can one have too much money in tax-deferred
Replies: 128
Views: 11396

Re: Can one have too much money in tax-deferred

Yes. I think that some "ordinary" people have put too much in tax deferred. Though, if one sees themselves moving towards this, the first option is to max out any Roth accounts. Then to move to taxable. From a tax perspective, it's better to convert traditional to Roth than to forgo traditional con...
by ThrustVectoring
Mon Oct 23, 2017 10:59 pm
Forum: Investing - Help with Personal Investments
Topic: No Cap on Match for 401K - Need Advice
Replies: 37
Views: 2449

Re: No Cap on Match for 401K - Need Advice

Over the long run, a passive broad-market strategy isn't "gambling" by any stretch of the imagination. It's simply owning a very small fraction of the public corporations in the US.

And if the match vests immediately, maxing your contributions is *absolutely* the correct choice.
by ThrustVectoring
Mon Oct 23, 2017 4:10 pm
Forum: Investing - Help with Personal Investments
Topic: Question : Paying off Mortgage
Replies: 26
Views: 2851

Re: Question : Paying off Mortgage

The only debts worth paying off early are revolving lines of credit and ones with really painful interest rates. HELOCs and checking-account linked lines of credits can be drawn against if you need the money again, so paying them down early hardly loses you any optionality. Actually, I'd be extreme...
by ThrustVectoring
Mon Oct 23, 2017 3:25 pm
Forum: Investing - Theory, News & General
Topic: Avoiding the Spiral
Replies: 21
Views: 3154

Re: Avoiding the Spiral

The way to avoid this is to either hold less stock, or be able to cut your retirement expenses if necessary. If you have a 40/60 portfolio, you're in a much better place to survive an early bear market. Alternatively, if your post-retirement budget includes a lot of discretionary spending, you can e...
by ThrustVectoring
Mon Oct 23, 2017 3:19 pm
Forum: Investing - Help with Personal Investments
Topic: Question : Paying off Mortgage
Replies: 26
Views: 2851

Re: Question : Paying off Mortgage

It sounds to me that you may not be terribly liquid. If that is the case, I would not prepay that mortgage any and would instead opt to raise cash or invest that cash rather than paying down the mortgage. I always have looked at it thus: If I lost my job, would I rather have a smaller mortgage and ...
by ThrustVectoring
Mon Oct 23, 2017 3:09 pm
Forum: Investing - Help with Personal Investments
Topic: 100% equity allocations v.s equity-bond allocations
Replies: 29
Views: 2580

Re: 100% equity allocations v.s equity-bond allocations

As ThrustVectoring pointed out, holding bonds and rebalancing automatically has always underperformed 100% equities over the long term. It's more than just that. 100% equities underperforms holding 120% of your portfolio's value in equities, paying the interest rate premium for margin loans compare...
by ThrustVectoring
Mon Oct 23, 2017 3:01 pm
Forum: Investing - Help with Personal Investments
Topic: Who does the portfolio reviews and why?
Replies: 21
Views: 1371

Re: Who does the portfolio reviews and why?

All the portfolio reviews here are done voluntarily. They are not assigned and there is no system. +1 Some of the initial portfolio reviews are "right on", others "not so much". But by the time there are a number of comments they are usually a pretty reasonable critique. That's a lot of why people ...
by ThrustVectoring
Mon Oct 23, 2017 2:23 pm
Forum: Investing - Help with Personal Investments
Topic: Advice needed: Savings & investment strategy
Replies: 3
Views: 396

Re: Advice needed: Savings & investment strategy

1) Does the Roth to tax-deferred mix look okay? It looks fine. The difference between the two doesn't matter all that much. If you wind up with too much tax-deferred, you need to make Roth conversions (usually after you stop working) to reduce the effect of required minimum distributions. If you wi...
by ThrustVectoring
Mon Oct 23, 2017 2:03 pm
Forum: Investing - Help with Personal Investments
Topic: 100% equity allocations v.s equity-bond allocations
Replies: 29
Views: 2580

Re: 100% equity allocations v.s equity-bond allocations

I'm at 95% stocks 5% bonds because I do not really like bonds. But as my assets grow I will increase my bond aa. Imo bonds serve 2 actual uses early in a portfolio. 1 of course is psychological. Second is that they allow for the much hated (on here) market timing. Keeping 10-20% in bonds which grow...
by ThrustVectoring
Sun Oct 22, 2017 10:53 am
Forum: Investing - Help with Personal Investments
Topic: question on a negative balance on my settlement fund at vanguard
Replies: 3
Views: 229

Re: question on a negative balance on my settlement fund at vanguard

You can sell stocks in the IRA without a penalty. You just can't transfer money from the IRA settlement fund into your bank account without penalty.
by ThrustVectoring
Sat Oct 21, 2017 11:33 pm
Forum: Investing - Help with Personal Investments
Topic: Rebalance with large capital gain
Replies: 13
Views: 1344

Re: Rebalance with large capital gain

Do you make or plan to make charitable donations? If so, you can replace them with donating appreciated stocks in-kind, skipping capital gains and getting the stocks full value as an income tax deduction. It's not worth doing if you weren't planning on charitable donation in the first place, but if ...
by ThrustVectoring
Fri Oct 20, 2017 2:53 pm
Forum: Investing - Help with Personal Investments
Topic: Looming Retirement & Market Jitters
Replies: 48
Views: 4342

Re: Looming Retirement & Market Jitters

You have far more than enough to retire. Your retirement assets need to cover $50k - $22k (pension) = $28k/yr. If you're at a 50/50 asset allocation, you have 25 times your annual expenses in bonds alone. If your equity assets dropped to zero you'd be fine. You can pick any asset allocation between ...
by ThrustVectoring
Fri Oct 20, 2017 2:23 pm
Forum: Investing - Help with Personal Investments
Topic: Emergency Fund Investment Strategy
Replies: 20
Views: 1720

Re: Emergency Fund Investment Strategy

First step is to find an online savings account with higher yield. 1.2% is out there at the very least. Next is to evaluate if you really need that much in cash. You probably don't. If you're employed, you probably need six months of expenses at most. If you have specific expenses coming up, that's ...
by ThrustVectoring
Fri Oct 20, 2017 2:07 pm
Forum: Investing - Help with Personal Investments
Topic: Asset Allocation with Farm Land
Replies: 20
Views: 1521

Re: Asset Allocation with Farm Land

This is probably more straightforward than people are making it out. Stocks and bonds are just junior and senior portions of the capitalization of a business. There's pricing for the senior portion of a business - the cost of taking on debt to finance the business. For real estate, this is mortgage ...
by ThrustVectoring
Thu Oct 19, 2017 2:47 pm
Forum: Investing - Theory, News & General
Topic: Do Index ETFs and Mutual Funds mute the diversification value of their diverse holdings?
Replies: 5
Views: 428

Re: Do Index ETFs and Mutual Funds mute the diversification value of their diverse holdings?

Not really. The diversification benefit is basically because sometimes companies will do well at the expense of other companies. If people stop shopping at Target and start shopping at Walmart instead, that will tend to push Target's stock price down and Walmart's stock price up. The overall value o...
by ThrustVectoring
Wed Oct 18, 2017 1:23 pm
Forum: Investing - Help with Personal Investments
Topic: If someone held a gun to your head, and force u to gamble whether the S&P 500 will rise or fall tomorrow, what do u say?
Replies: 45
Views: 2357

Re: If someone held a gun to your head, and force u to gamble whether the S&P 500 will rise or fall tomorrow, what do u

Thanks guys for not ripping me too hard. Yes I am trying to decide whether to lump sum or DCA a decent amount of $$ before 4 pm EST today. I realize that this is a completely ridiculous question. Go easy! Lump sum it. If it goes down, don't feel bad, because investing ASAP will do better on average...
by ThrustVectoring
Fri Oct 13, 2017 12:33 am
Forum: Investing - Help with Personal Investments
Topic: Need help investing $1M in today's market
Replies: 24
Views: 3886

Re: Need help investing $1M in today's market

On the other hand, few people are interested in "maximizing" their returns because otherwise they would be 100% invested in equities (or maybe 80/20 if that leads to a historically higher result after rebalancing). The margin for equities over bonds is too high compared to volatility for 80/20 to b...
by ThrustVectoring
Tue Oct 10, 2017 6:02 pm
Forum: Investing - Help with Personal Investments
Topic: What is a good Asset Allocation
Replies: 48
Views: 2756

Re: What is a good Asset Allocation

What's a Good Asset Allocation for a couple in their mid 30s with relatively high stable incomes in terms of Stock/Bond asset allocation? Their main goal is to be financially independent sooner rather than later. As a starting point I like to look at what asset allocation a target date fund uses fo...
by ThrustVectoring
Mon Oct 09, 2017 6:30 pm
Forum: Investing - Help with Personal Investments
Topic: Please define "cash"
Replies: 31
Views: 2075

Re: Please define "cash"

There can also be virtual cash contained in the ability of one to pay with credit. A lot of people have a larger credit card charge limit than they would ever hold in actual cash. I've got a very handy $10k line of credit attached to my checking account at my credit union. It basically means that f...
by ThrustVectoring
Sat Oct 07, 2017 7:32 pm
Forum: Investing - Help with Personal Investments
Topic: How to price backdoor roth availability?
Replies: 12
Views: 549

Re: How to price backdoor roth availability?

Turning a dollar from taxable into Roth is worth between 15 and 25 cents, depending on age. Older you are, the less time you have to take advantage of the tax protection on gains. I'm curious how you made this calculation. So, low end, the question is "how much money do I need to make an after-tax ...
by ThrustVectoring
Sat Oct 07, 2017 11:22 am
Forum: Investing - Theory, News & General
Topic: AAII Article: Target Wealth A Better Bet For Achieving Wealth Goals
Replies: 13
Views: 2129

Re: AAII Article: Target Wealth A Better Bet For Achieving Wealth Goals

It roughly matches my investment plan: buy equities until hitting 12x annual expenses, then let equities coast while buying bonds until I hit a 60/40 ratio. No dates are involved here because there's a pretty big variance in what I expect my future savings rate, earnings, and returns to be.