Search found 959 matches

by dandan14
Tue Jan 21, 2020 7:48 am
Forum: Investing - Theory, News & General
Topic: ESPP - company giving a do-over option
Replies: 17
Views: 1371

Re: ESPP - company giving a do-over option

I'd probably be more concerned with working for a company who's stock dropped 20% in a year when the market was up 30% You keep talking about "guarantees"..... how much have you lost in opportunity costs funneling money into this over the last year? What if the company goes bankrupt? This...
by dandan14
Mon Jan 20, 2020 3:45 pm
Forum: Investing - Theory, News & General
Topic: ESPP - company giving a do-over option
Replies: 17
Views: 1371

Re: ESPP - company giving a do-over option

Adding to my own post. This is a math problem -- not a stock timing problem. Worst case scenario in this plan is that you make 18% on your money over 2 years. Roughly 8.5% annualized. That's the likely outcome in this case, because it would be unlikely that the stock will go above where it was a yea...
by dandan14
Mon Jan 20, 2020 3:27 pm
Forum: Investing - Theory, News & General
Topic: ESPP - company giving a do-over option
Replies: 17
Views: 1371

ESPP - company giving a do-over option

So this is interesting. Our company only allows you to participate in 2 years of the ESPP. I don't know why. Like most ESPPs, it is setup to pretty much be a "can't lose" scenario for participants. For 2 years, you accrue money. A the end of 2 years, you get to purchase at the lower of eit...
by dandan14
Mon Oct 07, 2019 2:36 pm
Forum: Personal Investments
Topic: Borrowing at one rate (mortgage) and lending at another (bonds)
Replies: 7
Views: 841

Re: Borrowing at one rate (mortgage) and lending at another (bonds)

Ignore the bond returns vs mortgage rate argument: the rates are so close it may be a wash. Here's the pertinent question: Why would you want to lock up all or most of your available cash in a single, non-diversified asset? Someone is willing to give you a fixed loan at 2.75%, when inflation is 1.5...
by dandan14
Mon Oct 07, 2019 9:55 am
Forum: Personal Investments
Topic: Borrowing at one rate (mortgage) and lending at another (bonds)
Replies: 7
Views: 841

Re: Borrowing at one rate (mortgage) and lending at another (bonds)

whodidntante wrote: Mon Oct 07, 2019 9:11 am
A direct CD or Treasury note held to maturity is easier to compare because the outcome is certain, just like the mortgage.
That's my thinking as well. That's why I used 3% at NavyFed as my benchmark.
by dandan14
Mon Oct 07, 2019 8:27 am
Forum: Personal Investments
Topic: Borrowing at one rate (mortgage) and lending at another (bonds)
Replies: 7
Views: 841

Borrowing at one rate (mortgage) and lending at another (bonds)

Hey folks -- I love the way Allan Roth puts it -- that it makes no sense to borrow at 4% on a mortgage and lend at 2% on a bond. So before we take out this next mortgage, I want to think through this -- because it gets slightly more complicated. Mortgage: The builder incentivizes using their lender ...
by dandan14
Mon Oct 07, 2019 8:13 am
Forum: Personal Investments
Topic: Corp AAA bond vs. secondary market annuity
Replies: 7
Views: 518

Re: Corp AAA bond vs. secondary market annuity

bsteiner wrote: Sun Oct 06, 2019 9:33 pm The bond is more liquid.
That's a great point. Getting out of a 30 year payment arrangement (because that's what it is, more than an life annuity) would be costly. You'd have to try to sell it again on the secondary market -- which is likely costly and time consuming.
by dandan14
Sun Oct 06, 2019 8:39 pm
Forum: Personal Investments
Topic: Corp AAA bond vs. secondary market annuity
Replies: 7
Views: 518

Re: Corp AAA bond vs. secondary market annuity

The bond returns your principal at the end of the term. The annuity just ends. It looks like the specific SMA you're looking at costs ~$95k and pays out $142.5k over 23.75 years. A $95k bond yielding 2.75% would pay out ~$62k over 23.75 years, at the end of which you'd get your $95k back, for a tot...
by dandan14
Sun Oct 06, 2019 8:35 pm
Forum: Personal Investments
Topic: Corp AAA bond vs. secondary market annuity
Replies: 7
Views: 518

Re: Corp AAA bond vs. secondary market annuity

Gill wrote: Sun Oct 06, 2019 7:56 pm The annuity cash flow is not just income but is also a partial return of principal.
Gill
I double checked it with a spreadsheet. That is the YTM rate.
by dandan14
Sun Oct 06, 2019 7:37 pm
Forum: Personal Investments
Topic: Corp AAA bond vs. secondary market annuity
Replies: 7
Views: 518

Corp AAA bond vs. secondary market annuity

Can you folks help me understand something? A 30 year AAA corporate bond from Berkshire Hathaway is paying about 2.75-3%. However, I could theoretically buy an annuity on the secondary market also from BH that essentially acts like a 24 year bond paying 3.79%. https://www.immediateannuities.com/seco...
by dandan14
Thu Aug 02, 2018 4:24 pm
Forum: Personal Investments
Topic: Social Security + term life
Replies: 41
Views: 2317

Re: Social Security + term life

Not a wise plan with level term, because while the premium per dollars insured remains the same over the years, your likelihood of collecting rises every year. I'm sure it would make the insurance company very happy though. sorry edited -- i meant DECREASE. My plan is to consider "if" i k...
by dandan14
Thu Aug 02, 2018 11:38 am
Forum: Personal Investments
Topic: Social Security + term life
Replies: 41
Views: 2317

Re: Social Security + term life

One consideration if you move forward with this plan is to increase DECREASE the DB initially and then over the term reduce the DB (as the need for funds lessens) which will also reduce the yearly cost.[/color] Not a wise plan with level term, because while the premium per dollars insured remains t...
by dandan14
Thu Aug 02, 2018 11:36 am
Forum: Personal Investments
Topic: Social Security + term life
Replies: 41
Views: 2317

Re: Social Security + term life

]Note that $200K won't be $200K in today's dollars due to inflation 15-20 years from now. Would an inflation adjusted deferred annuity be an option? I think I would be at least as concerned about longevity risk with them.They don't have a big cushion. The cheapest inflation adjusted annuity you can...
by dandan14
Thu Aug 02, 2018 11:34 am
Forum: Personal Investments
Topic: Social Security + term life
Replies: 41
Views: 2317

Re: Social Security + term life

Take a look at the scenario where the higher earner (or maybe oldest) defers taking SS until age 70. The other takes SS at 62. The deferred benefit will be nearly 1/3 larger than the FRA benefit, and that larger benefit will ALSO be the survivor benefit for the other spouse, replacing their smaller...
by dandan14
Thu Aug 02, 2018 11:33 am
Forum: Personal Investments
Topic: Social Security + term life
Replies: 41
Views: 2317

Re: Social Security + term life

For those asking for details, here is my google spreadsheet. Keep in mind that both J and K are same age. https://docs.google.com/spreadsheets/d/1GDgq_TY-_xTugWtyUfoYX_3UbKflzefn3dxkAPhSbDE/edit?usp=sharing Note that $200K won't be $200K in today's dollars due to inflation 15-20 years from now. Wou...
by dandan14
Wed Aug 01, 2018 9:44 pm
Forum: Personal Investments
Topic: Social Security + term life
Replies: 41
Views: 2317

Re: Social Security + term life

For those asking for details, here is my google spreadsheet. Keep in mind that both J and K are same age.
https://docs.google.com/spreadsheets/d/ ... sp=sharing
by dandan14
Wed Aug 01, 2018 9:39 pm
Forum: Personal Investments
Topic: Social Security + term life
Replies: 41
Views: 2317

Re: Social Security + term life

[/quote]
In particular, what's the thinking behind just 10 years term?
[/quote]

I think you guys are right...surprisingly, a 20 year term for a 62 year old, is still not crazy expensive. It simplifies things, and actually allows me to push up the allowed expenditures another few thousand.
by dandan14
Wed Aug 01, 2018 5:02 pm
Forum: Personal Investments
Topic: Social Security + term life
Replies: 41
Views: 2317

Re: Social Security + term life

so you are suggesting $20K in premiums (over 10 years) on the risk that one of them dies prior to 72. What happens after 72 ? --then they really are kind of in the same situation. Lowish Nest egg and needing 2 SS incomes. When one of them passes the survivor will be in trouble, right ? What is thei...
by dandan14
Wed Aug 01, 2018 3:34 pm
Forum: Personal Investments
Topic: Social Security + term life
Replies: 41
Views: 2317

Re: Social Security + term life

I believe OP intends to suggest they buy the life insurance when they retire at 62, so there will be potentially a 2-year span of dual SS income before the term is up on the insurance. Not sure that solves the problem. There would still be a lot one one-check years left. Right....so I'm trying to f...
by dandan14
Wed Aug 01, 2018 8:15 am
Forum: Personal Investments
Topic: Social Security + term life
Replies: 41
Views: 2317

Re: Social Security + term life

Thanks guys -- you caught a couple of errors in my original thinking. First, the biggest error was that yes, I should have planned 2 life insurance policies. Second, I wasn't I didn't age them up + 2 years from now when I priced it out. So fixing that, assuming average health, seems like almost a pe...
by dandan14
Tue Jul 31, 2018 9:13 pm
Forum: Personal Investments
Topic: Social Security + term life
Replies: 41
Views: 2317

Social Security + term life

I'm curious to get thoughts on this. I'm helping some friends with social security / retirement planning. Both are age 60 hoping to retire in June 2020. Wife's PIA is slightly more than husband's PIA. I'm setting up their plan to start retirement at 62, but wait until much later to file SS -- living...
by dandan14
Sat Mar 31, 2018 11:08 am
Forum: Personal Finance (Not Investing)
Topic: Term life + ss survivors benefits
Replies: 7
Views: 766

Re: Term life + ss survivors benefits

Hillview wrote: Sat Mar 31, 2018 10:14 am Could be -- what about college savings? mortgage?
I figure the mortgage is just part of the yearly living expenses. I've never really understood the logic of planning to pay off a house when someone dies.

College savings are reasonably well funded already.
by dandan14
Sat Mar 31, 2018 11:06 am
Forum: Personal Finance (Not Investing)
Topic: Term life + ss survivors benefits
Replies: 7
Views: 766

Re: Term life + ss survivors benefits

One thought: how much is the cost difference between term life that would cover - 1/4 of current living expenses, vs. - 100% or even 150% of current living expenses (kids' college, etc.)? And what fraction of current income is that difference? I'm only talking about cutting the policy on my life --...
by dandan14
Sat Mar 31, 2018 9:27 am
Forum: Personal Finance (Not Investing)
Topic: Term life + ss survivors benefits
Replies: 7
Views: 766

Term life + ss survivors benefits

Can you folks help me think through something? It seems at this point in my career, Social Security Survivor's benefits are fairly generous -- and would cover about 3/4 of our current living expenses should I die. (If my wife were to die, her survivors' benefits are much lower.) So my thinking is th...
by dandan14
Sun Jan 21, 2018 3:58 pm
Forum: Investing - Theory, News & General
Topic: Research on bond portfolio with index call options?
Replies: 5
Views: 507

Re: Research on bond portfolio with index call options?

following up on my own post -- I believe I read this in a Zvi Bodie book.
by dandan14
Sun Jan 21, 2018 3:53 pm
Forum: Investing - Theory, News & General
Topic: Research on bond portfolio with index call options?
Replies: 5
Views: 507

Research on bond portfolio with index call options?

As I get close and closer to my FIRE number, I'm thinking a lot about ways to avoid any big down years. As Wade Pfau points out, it is the few years leading up to and out of "retirement" that can have the biggest impact on success. I'm currently at a 50/50 allocation with some call options...
by dandan14
Sun Jan 07, 2018 3:16 pm
Forum: Investing - Theory, News & General
Topic: Lowering my risk profile (AA or options)
Replies: 2
Views: 397

Re: Lowering my risk profile (AA or options)

I've been running scenarios all weekend. I'm leaning toward calls. I can shift my overall AA to 50/50 which will help me sleep better at night. Then I'll buy some 1 year calls every January for a cost of about 1% of my portfolio. (I've run some calcs, and I can make most of the shifts inside of IRAs...
by dandan14
Sun Jan 07, 2018 9:07 am
Forum: Investing - Theory, News & General
Topic: Lowering my risk profile (AA or options)
Replies: 2
Views: 397

Lowering my risk profile (AA or options)

Typically, I have been slowing shifting my AA more toward bonds as I've gotten older and closer to "winning the game." As I've grown increasingly uncomfortable with the idea of loss, I'm thinking of making a more significant shift to my strategy. I'm currently 75/25. I believe I have 3 opt...
by dandan14
Sat Dec 30, 2017 12:29 pm
Forum: Personal Investments
Topic: Backdoor Roth vs. Recharacterization
Replies: 24
Views: 2903

Re: Backdoor Roth vs. Recharacterization

1) Recharacterization is no longer allowed per new tax laws. You just have one shot. TravelforFun Hmm...my understanding is that recharacterizations are still allowed. For instance, you contribute to a Roth and, whoops, you made to much money. What you can no longer do is convert 3 buckets to a Rot...
by dandan14
Sat Dec 30, 2017 10:34 am
Forum: Personal Investments
Topic: Backdoor Roth vs. Recharacterization
Replies: 24
Views: 2903

Re: Backdoor Roth vs. Recharacterization

Thanks -- that's pretty much what I was thinking as well. I temporarily forgot about the 5 year rule -- because that is so unlikely to come into play here. But you're right -- that does add a little bit of a con to the conversion.
by dandan14
Sat Dec 30, 2017 7:56 am
Forum: Personal Investments
Topic: Backdoor Roth vs. Recharacterization
Replies: 24
Views: 2903

Backdoor Roth vs. Recharacterization

Looking into 2018, we'll likely be very close to the Roth income limits.
Is there any reason to prefer one of these options over the other?
1. Contribute to a Roth. Recharacterize if needed.
2. Contribute to a non-deductible and backdoor convert soon after.
by dandan14
Sun Dec 17, 2017 5:08 pm
Forum: Personal Finance (Not Investing)
Topic: Trust for my kids (in the event of my death)
Replies: 15
Views: 1997

Re: Trust for my kids (in the event of my death)

If worried about kids having too much control then allow them to be co-trustee with independent trustee and then they can be able trustee at designated age if they wish. ... Not sure if this is what you are thinking, but I'd shy away from any sort of mandatory distributions. For creditor protection...
by dandan14
Sun Dec 17, 2017 9:24 am
Forum: Personal Finance (Not Investing)
Topic: Trust for my kids (in the event of my death)
Replies: 15
Views: 1997

Re: Trust for my kids (in the event of my death)

If worried about kids having too much control then allow them to be co-trustee with independent trustee and then they can be able trustee at designated age if they wish. ... Not sure if this is what you are thinking, but I'd shy away from any sort of mandatory distributions. For creditor protection...
by dandan14
Sun Dec 17, 2017 9:22 am
Forum: Personal Finance (Not Investing)
Topic: Trust for my kids (in the event of my death)
Replies: 15
Views: 1997

Re: Trust for my kids (in the event of my death)

Beyond the Grave is a pretty good read. It has some interesting examples where the best laid plans when horribly wrong. It will give you things to think about and consider for your own estate plan. I do not want to be too controlling, however I also do not want my kiddos entire inheritance to be sq...
by dandan14
Sat Dec 16, 2017 8:02 pm
Forum: Personal Finance (Not Investing)
Topic: Trust for my kids (in the event of my death)
Replies: 15
Views: 1997

Trust for my kids (in the event of my death)

It has been about 10 years since we revised our wills. We just started working with an attorney to update them. I've been thinking about setting up a trust that would last in perpetuity, funded by our assets and the payouts from life insurance (in the event my wife and I both die). This would give t...
by dandan14
Sun Dec 03, 2017 2:32 pm
Forum: US Chapters
Topic: RTP, NC Chapter Meeting 11:00 AM Sat December 2, 2017
Replies: 6
Views: 2541

Re: RTP, NC Chapter Meeting 11:00 AM Sat December 2, 2017

While the 1200 mile round trip commute makes it tough for me to make the meetings, I still enjoy reading these summaries!
I'm really impressed that you guys have kept this going!
by dandan14
Sat Sep 09, 2017 12:09 pm
Forum: Personal Finance (Not Investing)
Topic: Anyone else freeze their credit score?
Replies: 126
Views: 14913

Re: Anyone else freeze their credit score?

Sure. I've had mine frozen for about 10 years. I thaw it a few times a year for a specific reason. Takes about 10 minutes to thaw all 3.
by dandan14
Tue Aug 15, 2017 12:25 pm
Forum: US Chapters
Topic: Detroit Area Bogleheads - Master Thread
Replies: 73
Views: 32703

Re: Detroit Area Bogleheads - Master Thread

Oh shoot, I should have googled that address. I didn't realize you were so far north. That makes it about 90 minutes for me -- which probably doesn't make sense.
Do you know of any groups around Ann Arbor?
by dandan14
Tue Aug 15, 2017 12:23 pm
Forum: US Chapters
Topic: Detroit Area Bogleheads - Master Thread
Replies: 73
Views: 32703

Re: Detroit Area Bogleheads - Master Thread

daytona084 wrote: Sat Jun 24, 2017 8:45 am The next meeting of the Detroit Chapter is planned for September 9th, 2017. It will be at the usual location (Multi-Lakes Conservation Association - scroll up for information). Hope to see everyone there!
Is it 10:30-noon?
by dandan14
Wed Jul 26, 2017 8:28 pm
Forum: Investing - Theory, News & General
Topic: CD Rates so much higher than bonds?
Replies: 14
Views: 2736

Re: CD Rates so much higher than bonds?

I guess the 250k fdic limit would keep out institutional money.
by dandan14
Wed Jul 26, 2017 8:01 pm
Forum: Investing - Theory, News & General
Topic: CD Rates so much higher than bonds?
Replies: 14
Views: 2736

CD Rates so much higher than bonds?

I know that Allan Roth often promotes the strategy of buying CDs over bonds -- and there are some good reasons for that. (You can typically cash out for a low penalty if rates go way up.) On the secondary market, you lose that benefit, and they behave much more like bonds. For that reason, I typical...
by dandan14
Sun Jun 04, 2017 8:44 am
Forum: Personal Finance (Not Investing)
Topic: Notice of Deficiency from IRS
Replies: 81
Views: 15194

Re: Notice of Deficiency from IRS

Good question. I don't know. But it's been 5 years ago. As I recall, most of my expense was in the CPA that I paid to audit the whole thing and confirm that I wasn't crazy.
by dandan14
Sat Jun 03, 2017 8:47 pm
Forum: Personal Finance (Not Investing)
Topic: Notice of Deficiency from IRS
Replies: 81
Views: 15194

Re: Notice of Deficiency from IRS

It was a long painful year of me appealing, appealing, and appealing again. No one would use 10 seconds of common sense to discover that the numbers couldn't possibly be right. Finally it was set to go to court. I said great. It was assigned to an attorney on their side who actually listened to what...
by dandan14
Sat May 20, 2017 9:51 pm
Forum: Personal Finance (Not Investing)
Topic: Need a group for group LTD
Replies: 3
Views: 791

Need a group for group LTD

A few years ago, when I was self-employed, I was able to purchase Long term disability through a trade association I joined. It was worth the $200 or so to join the association because the LTD was a good deal and easy to purchase. I just took a job with a new company that does not offer LTD. I no lo...
by dandan14
Mon Mar 20, 2017 8:02 pm
Forum: US Chapters
Topic: [Virtual online chapter - Master thread]
Replies: 136
Views: 39306

Re: Online group meetings via web conference? [Virtual online chapter]

If we want to do this right, I suggest that we use business-grade tools -- either gotomeeting/gotowebinar or webex.
Doing this on the cheap is likely going to result in frustration.

Decent tools would be about $600/yr to host up to 100 people. (Similar pricing for webex and goto.)
by dandan14
Fri Mar 17, 2017 7:27 pm
Forum: US Chapters
Topic: [Virtual online chapter - Master thread]
Replies: 136
Views: 39306

Re: Online group meetings via web conference? [Virtual online chapter]

Wow, my 4 year old post got some new life today! Since there seems to be some interest, I would be interested in working on this. I use webex daily for work, but that's not something I want to pay for. Others mentioned free tools. What are the best free tools for webex-like web conferences? dan
by dandan14
Tue Dec 06, 2016 12:41 pm
Forum: Investing - Theory, News & General
Topic: Sequence of returns risk. Using puts to hedge.
Replies: 26
Views: 3005

Re: Sequence of returns risk. Using puts to hedge.

Wade Pfau and others have put a lot of thought into "sequence of returns" risk, which definitely applies in this scenario. One thing I was running the math on last night was potentially buying long term (LEAPS) puts against the S&P. If I buy puts at a strike price of 20% less than cur...
by dandan14
Mon Dec 05, 2016 9:46 pm
Forum: Investing - Theory, News & General
Topic: Sequence of returns risk. Using puts to hedge.
Replies: 26
Views: 3005

Re: Sequence of returns risk. Using puts to hedge.

They do make LEAPS for 2+ years. The good news is that a 2 year leap on the S&P seems to be priced at the same 2.1% per year. So for about 4.2%, i could buy 20% downside protection for 2 years. So the "rolling risk" of 2 down years in a row would be insured as well.
by dandan14
Mon Dec 05, 2016 1:17 pm
Forum: Investing - Theory, News & General
Topic: Sequence of returns risk. Using puts to hedge.
Replies: 26
Views: 3005

Sequence of returns risk. Using puts to hedge.

I'm considering an "early retirement" in the next year or so -- at least to the extent that I make a conscious decision to get off of the corporate merry-go-round and do something that likely pays a fraction of my current salary. Depending on what that is, we may or may not be able to live...
by dandan14
Tue Nov 01, 2016 6:46 pm
Forum: Personal Finance (Not Investing)
Topic: Moved in with in-laws - Implications?
Replies: 11
Views: 2591

Re: Moved in with in-laws - Implications?

I can't answer all of those, but if they put it explicitly in their will that the house goes to you, I can't see why there would be an issue. Since they are the sole owners, you would receive the house at a "stepped-up value."