Search found 71 matches

by jah
Wed Dec 30, 2015 1:08 pm
Forum: Personal Investments
Topic: Capital Gain Offset Question
Replies: 14
Views: 919

Re: Capital Gain Offset Question

Thank you for the help everyone!
by jah
Wed Dec 30, 2015 9:48 am
Forum: Personal Investments
Topic: Capital Gain Offset Question
Replies: 14
Views: 919

Re: Capital Gain Offset Question

First, I want to check and make sure you didn't make a newbie mistake. When calculating your cost basis, did you include any reinvested dividends and capital gain distributions in the cost basis? You already paid taxes on these, so they are treated as thought they were new money. I switched to SpecID cost basis back in 2012 for my taxable holdings. I have not invested new money into the VTIAX since December 2012. Does this clarify the scenario? I'm not sure what you mean by "ordinary" income - non capital gains? It you have enough wage income that you are paying 25% on any of it, then you will be taxed 15% on ALL of your capital gains. Your total taxable income counts towards determining the tax on capital gains - not just the ca...
by jah
Wed Dec 30, 2015 9:19 am
Forum: Personal Investments
Topic: Capital Gain Offset Question
Replies: 14
Views: 919

Re: Capital Gain Offset Question

livesoft wrote:
jah wrote:Is there any harm done if I just sit on the sidelines for the time required to avoid a wash sale?
Yes, I predict that VFWAX will go up by 10% in January 2016. You really don't want to miss that gain.
Thanks for the tip! :D
by jah
Wed Dec 30, 2015 9:05 am
Forum: Personal Investments
Topic: Capital Gain Offset Question
Replies: 14
Views: 919

Re: Capital Gain Offset Question

Thank you livesoft! Exchange your VTIAX into VFWAX today. I assume the benefit of the VTIAX to VFWAX exchange is to continue to have exposure to the international stock market. Is there any harm done if I just sit on the sidelines for the time required to avoid a wash sale? You are completely mistaken about what you wrote about the wash sale rule. I mention this in case someone else reads your post and takes it to heart. Was my mistake that the wash sale will occur if I don't wait the required 30-day period (instead of the three month period I wrote)? My apologies. I was confused by the fact that Vanguard does not allow one to reinvest in some mutual funds until a certain period of time passes (which I thought was 90 days for VTIAX but is a...
by jah
Wed Dec 30, 2015 8:19 am
Forum: Personal Investments
Topic: Capital Gain Offset Question
Replies: 14
Views: 919

Capital Gain Offset Question

I was invested in the Vanguard Wellington Fund Admiral (VWENX) earlier this year. This fund was in my taxable account, and I decided to divest earlier this year. The result of selling my shares was a capital gain of almost $16,000 (all long-term). The only fund I have in my taxable account that I could use to offset this gain is my Vanguard Total International Stock Index Fund Admiral (VTIAX) holding. Selling this holding would result in a capital loss of roughly $3,000 (all long-term). My tax rate (married, filing jointly) on ordinary income this year will straddle the 15% and 25% brackets (but will likely be in the 25% bracket). Would it be wise to sell the VTIAX shares to partly offset the VWENX gains? If I did sell the VTIAX shares, I w...
by jah
Fri Dec 18, 2015 12:05 am
Forum: Personal Investments
Topic: EE Bonds for Long-Term Savings Vehicle
Replies: 29
Views: 2906

Re: EE Bonds for Long-Term Savings Vehicle

As part of a diversified fix income portfolio, fine. But still, what's the argument for extending maturity by 10 years for only 5 basis points per year of extra maturity compared to a 10-year CD at 3%? I guess it's OK if you do some of each, as the EE bond is a bet on not being able to invest in a 10-year CD (or some other safe nominal fixed-income asset) at 4% or more in 10 years, and the 10-year 3% CD is a bet that you will be able to. I think the whole-portfolio argument is to stay shorter-term on the fixed income, and take more risk in stocks; at least that's what Larry Swedroe recommends, although perhaps extending maturity with TIPS if the longer-term rates justify it. Kevin Hi Again Kevin: You seem to be overlooking the tax-deferred...
by jah
Thu Dec 17, 2015 11:33 pm
Forum: Personal Investments
Topic: EE Bonds for Long-Term Savings Vehicle
Replies: 29
Views: 2906

Re: EE Bonds for Long-Term Savings Vehicle

Thank you all for your replies. Many of you cited the same reasons I have hesitated about putting this $10,000 into EE savings bonds - the money has to be invested 20 years for any real payout (the doubling), and there is no protection from inflation (unlike I saving bonds). I was thinking this money for my daughter was not going to be set aside for education (as already have money invested in I savings bonds and in a 529 for this purpose). However, maybe it is wise to invest this $10,000 in a vehicle that provides tax advantages if used for education. No harm in that is there? Would there be any benefit of putting this money in a non-529 vehicle (e.g., just an regular Vanguard balanced fund)? I would lose the tax benefits that come with th...
by jah
Wed Dec 16, 2015 9:28 pm
Forum: Personal Investments
Topic: EE Bonds for Long-Term Savings Vehicle
Replies: 29
Views: 2906

EE Bonds for Long-Term Savings Vehicle

My 3 year old daughter received money gifts from her grandparents, uncles, etc. over the past couple of years totaling approximately $10,000. I initially put this money in an Ally Bank 12-month CD making 1% yearly interest, but now that the CD has matured I am thinking it might be better to place this money somewhere else. I savings bonds are not in the cards because I have already reached my annual purchase limit (and these I savings bonds will likely be used for education purposes). I have been thinking about placing this money in EE savings bonds because their value doubles after 20 years, making it a nice gift to give my daughter when she is 23 years old. Before I pull the trigger on making this EE savings bond purchase I wanted to ask ...
by jah
Fri May 15, 2015 10:19 pm
Forum: Personal Investments
Topic: Bonds, Average Duration, and NAV - and Confusion
Replies: 9
Views: 1423

Re: Bonds, Average Duration, and NAV - and Confusion

The duration of VBTLX is 5.63 years, not 7.8 years. My mistake, I accidently quoted the average maturity instead of the average duration. The "point of indifference" math means that you expect to earn the current SEC yield (compounded) after 5.63 years, no matter what happens with yields in the short term (this is considerably better than 0%). So this means $1000 becoming $1115, even if it takes a trip through the $900's. Expanding on this for clarification purposes, let's say I purchased $1000 VBTLX (NAV of 10.86, average duration of 5.63, 30-day SEC yield of 1.96%, TTM yield of 2.47%) today. Immediately after purchase interest rates rise 1%. As a result, the NAV of the VBTLX purchased drops ~5.63% to 10.25. The "point of i...
by jah
Fri May 15, 2015 5:37 am
Forum: Personal Investments
Topic: Bonds, Average Duration, and NAV - and Confusion
Replies: 9
Views: 1423

Re: Bonds, Average Duration, and NAV - and Confusion

Some follow-up questions... Let's use the same hypothetical I started this thread with - purchasing the Vanguard Total Bond Market Admiral (VBTLX) at a NAV of 10.86 and a duration of 7.8 years. I understand that if interest rates go up by, say 1%, the NAV of the bond fund will decrease roughly 7.8%. I am aware that if I hold my purchase for one duration and reinvest all dividends during this time the value of my fund will be the same as if interest rates never changed. Does this mean that over the course of one duration the value of my total bond fund assets will have increased ~0% (i.e., there will be no income generated for 7.8 years)? Where does the average yield of the bond fund come into play in all this? As an example, let's say I pur...
by jah
Tue May 05, 2015 4:35 am
Forum: Personal Investments
Topic: Bonds, Average Duration, and NAV - and Confusion
Replies: 9
Views: 1423

Re: Bonds, Average Duration, and NAV - and Confusion

What happens if we stick with the original purchase - I purchase one share of VBTLX at NAV of 10.86 (i.e., invest $10.86) - and rates immediately went up. I then decide to buy $10.86 worth of VBTLX after the increase at the new lower NAV (say one day later). Is it correct that with the second purchase I bought more VBTLX at a higher interest rate, or am I just missing something very basic? This too is correct and it makes things even better -- if you [will] have additional money to invest, the availability of safe funds yielding 3% instead of 2% is a big boost going forward. This is what I thought - a rate increase will lower the bond fund NAV, resulting in one not only being able to purchase additional shares (relative to before the rate ...
by jah
Mon May 04, 2015 11:47 pm
Forum: Personal Investments
Topic: Bonds, Average Duration, and NAV - and Confusion
Replies: 9
Views: 1423

Bonds, Average Duration, and NAV - and Confusion

Questions concerning bonds, average duration, and NAV... Is it correct that an increase or decrease in interest rates (no matter the change in rate) will have no net effect on the value of one's bond fund holdings if said bond fund holdings are held for one average duration? Lets take the Vanguard Total Bond Market Admiral (VBTLX) as an example - today it closed with a NAV of 10.86, an average maturity of 7.80 years, and an average duration of 5.62 years. Say I purchased VBTLX at a NAV of 10.86 and rates immediately went up. If I held this purchase and reinvested all dividends at the time of one average duration I will have a fund worth my original purchase plus interest compounded by the yield at the time of the original purchase. Is this ...
by jah
Wed Jun 11, 2014 4:28 am
Forum: Personal Investments
Topic: To Sell or Not to Sell (for Capital Gain Offset)
Replies: 16
Views: 2182

Re: To Sell or Not to Sell (for Capital Gain Offset)

Thank you dbr and grabiner! The comments were very helpful. I am going to sell the VFH and harvest the loss.

Regarding the Wellington fund, I realize that it is not the best of funds to have in my taxable account. I would move my Wellington holdings to my tax-advantaged account if the move was not problematic. However, my tax-advantaged account is already 100% bonds and in order to keep my desired stock/bond allocation I am forced to keep some fund that includes bonds in my taxable account. Whether Wellington is the best option for this is debatable.
by jah
Mon Jun 09, 2014 8:48 am
Forum: Personal Investments
Topic: To Sell or Not to Sell (for Capital Gain Offset)
Replies: 16
Views: 2182

Re: To Sell or Not to Sell (for Capital Gain Offset)

It is indeed 2014, but early 2014. I thought I would sit on the VFH, see how it performs, and then decide whether to use it in a tax-loss harvesting move later in the year. You should sell it now if you still have a loss. You can buy something else similar if you want to hold financials (someone else's ETF tracking a different index, or a mutual fund), but the tax loss is a guaranteed benefit. If the market goes up, you'll lose the benefit of your tax loss, and if you harvest and the market goes down, you won't lose anything because you can harvest the loss in your replacement. I am finally getting back to the forum and this post, as I have been away for quite some time due to some family difficulties. I still am still holding VFH, and can...
by jah
Tue Jan 07, 2014 1:04 pm
Forum: Personal Investments
Topic: To Sell or Not to Sell (for Capital Gain Offset)
Replies: 16
Views: 2182

Re: To Sell or Not to Sell (for Capital Gain Offset)

livesoft wrote:I thought the advice was to sell VFH in 2014 for the tax loss and use the money to buy somethign else in a tax-loss harvesintg move. It's 2014.
It is indeed 2014, but early 2014. I thought I would sit on the VFH, see how it performs, and then decide whether to use it in a tax-loss harvesting move later in the year.
by jah
Mon Jan 06, 2014 4:53 am
Forum: Personal Investments
Topic: To Sell or Not to Sell (for Capital Gain Offset)
Replies: 16
Views: 2182

Re: To Sell or Not to Sell (for Capital Gain Offset)

livesoft wrote:This was about the PREVIOUS year. What did you do?
I took the wise advice given to me and held onto the VFH holdings.
by jah
Mon Jan 06, 2014 4:42 am
Forum: Personal Investments
Topic: Large-Cap Tilt Fix
Replies: 11
Views: 1319

Re: Large-Cap Tilt Fix

steve_14 wrote:I don't think a slight weighting difference in one bit of the market is going to impact your terminal net worth in any meaningful way. Not worth worrying about.
You make a good point. I likely do worry about this a bit too much. The important thing for me has been establishing a 60/40 stock to bond ratio for my portfolio. I thought I would now start dealing with minor points such as this large-cap tilt. I have no idea if it is worth the trouble, but assumed it would be wise to balance my stock portfolio so that it mirrors the market.
by jah
Mon Jan 06, 2014 4:31 am
Forum: Personal Investments
Topic: Large-Cap Tilt Fix
Replies: 11
Views: 1319

Re: Large-Cap Tilt Fix

pkcrafter wrote:jah,

When mixing in a balanced fund it can get difficult to hit your AA, but it sounds like you can work it out, so that's good. I agree that using the extended market is a great way to go, and if you have a long time horizon, I'd suggest 30% of equity. Wellington's value tilt is a plus as total market tends to be tilted somewhat toward growth. Is Wellington in a tax deferred account?

Paul
The Wellington is not in a tax deferred account. I take a bit of a beating for this come tax time and have thought about selling the fund. Decided to simply hold onto the fund, but no longer invest or reinvest distributions.
by jah
Mon Jan 06, 2014 4:26 am
Forum: Personal Investments
Topic: Large-Cap Tilt Fix
Replies: 11
Views: 1319

Re: Large-Cap Tilt Fix

Laura wrote:I would use the extended market index despite the extra .04 in cost. It is simple and nicely completes the S&P 500. I love that on this forum we are worried about a .04 difference in expense ratio when people are investing in funds with ER that are 1 or 2%.

Laura
Thank you for your thoughts. I also think the extended market index fund, rather than a mix of small-cap and mid-cap funds, would be easier to use. The extended market has a more diversity than all other Vanguard small-cap/mid-cap funds. I would think this explains the extra .04 cost. If not, I am not sure where the extra cost comes from.
by jah
Sun Jan 05, 2014 3:50 am
Forum: Personal Investments
Topic: Large-Cap Tilt Fix
Replies: 11
Views: 1319

Large-Cap Tilt Fix

I would appreciate advice on how to compensate for the large-cap tilt in my retirement portfolio caused by having the Wellington fund (VWENX) among its holdings. The tilt has resulted in both my mid-cap and small-cap holdings being approximately 5% less than found in the domestic stock market. My only other domestic stock holding is the Vanguard Total Stock Market Index fund (VTSAX). My retirement portfolio stock to bond ratio is presently 60:40, and I hope to maintain this ratio as I invest in a way that fixes the large-cap tilt. My bond holdings outside of VWENX) are held entirely in the Vanguard Total Bond Market Index fund (VBTLX). Vanguard's offerings for small-cap and mid-cap index funds that I am interested in are Extended Market Ind...
by jah
Sun Jan 05, 2014 2:55 am
Forum: Personal Investments
Topic: To Sell or Not to Sell (for Capital Gain Offset)
Replies: 16
Views: 2182

Re: To Sell or Not to Sell (for Capital Gain Offset)

kaneohe wrote:btw.....your OP is a bit confusing because you talk about a gain of -$2000 . Folks who waded thru the words probably decided the - sign
was an error by reading between the lines but there are some of us who think numbers and algebraic signs override mere words and got confused..
Thanks for the advice. I have edited my original post to clarify - using approximately instead of "~".
by jah
Wed Dec 18, 2013 9:09 pm
Forum: Personal Investments
Topic: Suggestions for some Short Term investment options?
Replies: 4
Views: 567

Re: Suggestions for some Short Term investment options?

As suggested by SteveK, check out Ally bank. You can open on online savings/checking account that presently bears something around 0.8%-0.9%. Or, set up a CD ladder (4 CD's with $5,000 each) and get an get a little more than that. I use Ally and have had no problems. No reason to be earning 0.1% when you can make 10 times more with no additional risk!
by jah
Wed Dec 18, 2013 7:13 am
Forum: Personal Investments
Topic: To Sell or Not to Sell (for Capital Gain Offset)
Replies: 16
Views: 2182

To Sell or Not to Sell (for Capital Gain Offset)

Hello everyone! Earlier this year I sold my investment in the Vanguard Growth Index Fund (VIGRX) for a capital gain of approximately $2,000. I am wondering if there is any reason to offset this capital gain by selling my investment in the Vanguards Financial ETF (VFH). Or, selling all of my VFH for a total capital loss of approximately $4,000 and applying it against my regular income. Another option is simply to hold on to it. Both the VIGRX and VFH investments were long-term capital gains/losses. I will likely fall into the 15% tax bracket, but might barely get into the 25% tax bracket. I have no reason to hold on to the VFH investment, nor do I have a reason to keep it. I purchased it years back when I did not know what I was doing... :oo...
by jah
Wed Nov 06, 2013 8:36 pm
Forum: Personal Investments
Topic: Need to choose a 529 - Live in CA (no state tax benefits)
Replies: 16
Views: 2425

Re: Need to choose a 529 - Live in CA (no state tax benefits

I too live in CA. I narrowed down my search to the Utah and Nevada (vanguard.com) plans, and finally decided to go with the Nevada plan. Nothing against the Utah plan - it is one of the best - but wanted to keep the 529 funds in the same place as my retirement funds. I also set aside a bit of money for the kid's college expenses in I-bonds.
by jah
Mon Feb 04, 2013 11:17 pm
Forum: Personal Investments
Topic: Another 529 Plan Question
Replies: 7
Views: 932

Re: Another 529 Plan Question

I think either can be done, but I can only speak for the Vanguard 529 plan. I have this plan for my daughter, and its allows contributions to be made by anyone (and my brother has done just that). The only problem I can foresee is if you act as the sole contributor (i.e. your in-laws give you the funds to invest into the 529) and the total amount contributed reaches the maximum amount allowed for individual contributions (~$13,000 this year I believe).
by jah
Fri Jan 25, 2013 3:52 pm
Forum: US Chapters
Topic: Happy Birthday Taylor
Replies: 81
Views: 10220

Re: Happy Birthday Taylor

Taylor,

Happy birthday! You have been a great help to me and it has been greatly appreciated. Enjoy your day!
by jah
Thu Jan 24, 2013 6:12 am
Forum: Personal Investments
Topic: Bond Fund for Taxable Account
Replies: 20
Views: 3676

Re: Bond Fund for Taxable Account

I must say that I don't follow why Total Bond is likely better than the Intermediate Tax Exempt if my tax bracket is 15%. When I used Vanguard's taxable-equivalent yield calculator, I found that Total Bond would need to earn a 1.94% yield in order to match the present Intermediate Tax Exempt SEC yield of 1.64%. Total Bond presently has a SEC yield of 1.59%. Thus, I thought Intermediate Tax Exempt would be better to hold in the taxable account. Am I making a calculation error or, worse, simply way off base in my thinking? Total Bond Market is much less risky than Intermediate-Term Tax-Exempt, because it holds a lot of Treasury bonds. A better comparison fund is Intermediate-Term Investment-Grade. That fund has a 2.07% SEC yield, which would...
by jah
Thu Jan 24, 2013 5:10 am
Forum: Personal Investments
Topic: Bond Fund for Taxable Account
Replies: 20
Views: 3676

Re: Bond Fund for Taxable Account

If your tax bracket is 15%, Total Bond is probably better than Intermediate Tax Exempt. If your bracket is 25%, it is about equal. While you are in CA, the CA Tax Exempt would be good if your federal bracket is 25%. rkhusky, thank you for the reply! I must say that I don't follow why Total Bond is likely better than the Intermediate Tax Exempt if my tax bracket is 15%. When I used Vanguard's taxable-equivalent yield calculator, I found that Total Bond would need to earn a 1.94% yield in order to match the present Intermediate Tax Exempt SEC yield of 1.64%. Total Bond presently has a SEC yield of 1.59%. Thus, I thought Intermediate Tax Exempt would be better to hold in the taxable account. Am I making a calculation error or, worse, simply w...
by jah
Thu Jan 24, 2013 4:42 am
Forum: Personal Finance (Not Investing)
Topic: Paper I-Bonds Purchases With Tax Return
Replies: 32
Views: 4209

Re: Paper I-Bonds Purchases With Tax Return

DetroitRed wrote:Thanks for the info dratkinson and tfb.
I second that thanks, and throw in some thanks to SSSS!
by jah
Wed Jan 23, 2013 8:56 am
Forum: Personal Finance (Not Investing)
Topic: Paper I-Bonds Purchases With Tax Return
Replies: 32
Views: 4209

Re: Paper I-Bonds Purchases With Tax Return

I think that thread is about Mel preferring paper bonds (which he does). I didn't find any post about buying paper bonds from the IRS, but I did see a reference to a refund. You are correct. But Mel's posts in the thread on why he preferred paper over electronic I-bonds got me thinking. I, too, would rather have paper over electronic. Because I will not have a refund coming to me this year I searched the IRS website to see if there was a way to overpay what I owe on my tax returns in order to purchase paper I-bonds. I could find no such reference on the website. So, thought I would ask in the forum because there are members who are very I-bond aware. Found the answer I was looking for - as you indicated earlier in the thread there is no wa...
by jah
Wed Jan 23, 2013 8:29 am
Forum: Personal Finance (Not Investing)
Topic: Paper I-Bonds Purchases With Tax Return
Replies: 32
Views: 4209

Re: Paper I-Bonds Purchases With Tax Return

assumer wrote:
jah wrote:
sscritic wrote:OK, you are under 50 posts so I will try and be gentle.
Thanks for being gentle... :D.

I am simply surprised that the IRS would not allow a tax payer to drop $5,000 extra on their returns for I-bonds. My question came about because I was reading a thread from 2009 in which Mel Lindauer listed his reasons for preferring paper I-bonds over electronic through TD.
Do you have a link to that article? The only advantage I see is to be able to hit $15,000 in I-Bonds in a given year rather than $10,000. And I fully plan on converting my paper ones to electronic so as not to have a chance of losing them :wink:
Hope this link to the thread works....

http://www.bogleheads.org/forum/viewtopic.php?t=46154
by jah
Wed Jan 23, 2013 8:17 am
Forum: Personal Finance (Not Investing)
Topic: Paper I-Bonds Purchases With Tax Return
Replies: 32
Views: 4209

Re: Paper I-Bonds Purchases With Tax Return

sscritic wrote:OK, you are under 50 posts so I will try and be gentle.
Thanks for being gentle... :D.

I am simply surprised that the IRS would not allow a tax payer to drop $5,000 extra on their returns for I-bonds. My question came about because I was reading a thread from 2009 in which Mel Lindauer listed his reasons for preferring paper I-bonds over electronic through TD.
by jah
Wed Jan 23, 2013 7:31 am
Forum: Personal Investments
Topic: Bond Fund for Taxable Account
Replies: 20
Views: 3676

Re: Bond Fund for Taxable Account

If your tax bracket is 15%, Total Bond is probably better than Intermediate Tax Exempt. If your bracket is 25%, it is about equal. While you are in CA, the CA Tax Exempt would be good if your federal bracket is 25%. rkhusky, thank you for the reply! I must say that I don't follow why Total Bond is likely better than the Intermediate Tax Exempt if my tax bracket is 15%. When I used Vanguard's taxable-equivalent yield calculator, I found that Total Bond would need to earn a 1.94% yield in order to match the present Intermediate Tax Exempt SEC yield of 1.64%. Total Bond presently has a SEC yield of 1.59%. Thus, I thought Intermediate Tax Exempt would be better to hold in the taxable account. Am I making a calculation error or, worse, simply w...
by jah
Wed Jan 23, 2013 7:20 am
Forum: Personal Finance (Not Investing)
Topic: Paper I-Bonds Purchases With Tax Return
Replies: 32
Views: 4209

Paper I-Bonds Purchases With Tax Return

Hello all!

It is my understanding that the only way to purchase paper I-bonds is using your IRS tax return ($5,000 per SSN). Does one need to be receiving a refund in order to purchase I-bonds using your federal tax return? For example, if I wanted to purchase $5,000 worth of I-bonds does my tax refund need to be at least this amount. I could not find any information on the IRS website that indicated that I-bonds could be purchased if you owe tax. Truly a shame, because I would include payment in my IRS tax return check for I-bonds if I could purchase them.

Jason
by jah
Tue Jan 22, 2013 10:02 pm
Forum: Personal Investments
Topic: Massachusetts Tax-Exempt Bond Fund
Replies: 5
Views: 682

Re: Massachusetts Tax-Exempt Bond Fund

Hello abonder!

I started a thread in the "Investing - Help with Personal Investments" section yesterday ("Bond Fund for Taxable Account" is the thread title) that deals with a question similar to yours. I also can't keep my desired asset allocation without moving bonds into my taxable account. There were a number of replies to my post that you would likely find helpful, especially in regards to tax-exempt funds in a taxable account. Hope the thread proves helpful.

(My apologies for just naming the thread and not providing a link. I don't know how to link.)

Jason
by jah
Tue Jan 22, 2013 12:49 pm
Forum: Personal Investments
Topic: Bond Fund for Taxable Account
Replies: 20
Views: 3676

Re: Bond Fund for Taxable Account

My federal tax rate is 15% or 25% (depending upon the year because income is variable), and my state tax (CA) is ~9%. Thanks for your idea. I would consider muni bond funds as well. They may well make sense if your combined tax rate is over 30%. I had thought about Vanguard's California Intermediate-Term Tax Exempt Admiral (VCADX) as I live in CA. This would allow me to avoid both state and federal taxes! However, I am not sure how long I will remain in CA because my work situation is rather fluid. Also, VCADX is not as diverse as either Vanguard Total Bond Market Admiral (VBTLX) or Vanguard Intermediate-Term Tax Exempt Admiral (VWIUX). If I do invest in a tax-exempt fund, I would prefer that it mirrors VBTLX as closely as possible. Jason
by jah
Tue Jan 22, 2013 12:36 pm
Forum: Personal Investments
Topic: Bond Fund for Taxable Account
Replies: 20
Views: 3676

Re: Bond Fund for Taxable Account

Angst wrote:Hi Jason,

How big is this $200k with respect to your entire portfolio?
How old are you?
The $200,000 influx would when invested represent roughly 25% of my retirement portfolio. My wife and I are both near forty - one below, one above.
Angst wrote:If there's any possibility that you are much younger and could tolerate (stay the course of) a higher equity allocation, you might solve your problem that way.
I would say I lean toward the conservative side, and 60/40 is about the most I feel I can tolerate.

Thank your for your thoughts! :sharebeer

Jason
by jah
Tue Jan 22, 2013 12:31 pm
Forum: Personal Investments
Topic: Bond Fund for Taxable Account
Replies: 20
Views: 3676

Re: Bond Fund for Taxable Account

Johm221122 wrote:How about EE bonds?at 10k each for I bond and EE bonds each year it adds up over time.If your married that's 40k
http://www.bogleheads.org/forum/viewtop ... 0&t=106029
John
I have given EE bonds plenty of thought, but their present yield is so low. Have to lock myself in for 20 years to see the big doubling - that makes me hesitate. But adding them to my portfolio does solve the allocation and taxation problems! Thanks for your advice.
by jah
Tue Jan 22, 2013 4:08 am
Forum: Personal Investments
Topic: Bond Fund for Taxable Account
Replies: 20
Views: 3676

Bond Fund for Taxable Account

Hello all! I posted yesterday, but I believe my post was a bit verbose and not very clear. Thought I would try again in hopes of greater feedback! (I do thank LAlearning for his thoughtful response to my questions in the earlier post.) I had recently returned to me ~$200,000. My question is how to invest this money. My asset allocation is 60/40 stocks/bonds, and I have no room left in my tax-advantaged accounts for bonds. Thus, I will have to place some bonds into my taxable account in order to retain my desired 60/40 stock/bond ratio. I see my options as follows, and would like comments and/or advice on these options (as well as any others). (1) Purchase I-bonds. This will help keep bonds out of my taxable account, but will still need to p...
by jah
Mon Jan 21, 2013 11:16 pm
Forum: Personal Investments
Topic: Help! I'm maxed out with cash lying around
Replies: 22
Views: 6270

Re: Help! I'm maxed out with cash lying around

Hello, and thanks for posting! I am relatively new here, so take what I say with a grain of salt. What I write below I have picked up from more "senior" members of this forum. I would suggest that you first set aside an amount you feel comfortable with in an emergency fund - bank account/cd ladder/money market. Next, I would determine what asset allocation (stock/bond ratio, etc) you want in your retirement account. People have different views on what the best allocation is, but you should pick one that reflects your retirement date and your risk tolerance. A good strategy - albeit some would say a bit conservative - is to match your bond % with your age. Within your planned stock assets you should divide into domestic and interna...
by jah
Mon Jan 21, 2013 10:22 am
Forum: Personal Investments
Topic: Advice: Large Cash Influx & Maintaining My Asset Allocation
Replies: 1
Views: 789

Advice: Large Cash Influx & Maintaining My Asset Allocation

Dear Bogleheads new and old, I recently had $200,000 returned to me, and would like to now place this money into my wife's and my retirement accounts. This large influx of money will cause us to place bonds in our taxable accounts in order to maintain our desired asset allocation. Below is our present situation and breakdown of our retirement funds: Emergency funds: $50,000 Debt: None Tax Filing Status: Married Filing Jointly Tax Rate: 15%-25% Federal (my income is variable), 8%-9.3% State (my income is variable) State of Residence: California Age: Wife-39; Me-43 Desired Asset allocation: 60% stocks / 40% bonds Desired International allocation: 25% of stocks Current retirement assets: His IRA (Roth and Rollover) $61,000 in Vanguard Total Bo...
by jah
Mon Jan 21, 2013 8:55 am
Forum: Personal Investments
Topic: Average Bond Duration in your portfolio
Replies: 48
Views: 3205

Re: Average Bond Duration in your portfolio

BigFoot48 wrote:Whatever Total Bond Fund and Inflation Protected Securities Fund are. Frankly I don't worry about it because I don't anticipate selling any bond funds and when my estate liquidates the funds in hopefully 20+ years I won't be around to care.
I love your thinking!
by jah
Sun Jan 06, 2013 10:59 am
Forum: Personal Finance (Not Investing)
Topic: Personal finances for 3 months in Paris
Replies: 15
Views: 1781

Re: Personal finances for 3 months in Paris

When I visited France last year I paid for my lodging via PayPal. There was a small fee for converting American :dollar to Euros, but that fee was nothing compared to what the credit cards wanted. Just a thought...
by jah
Sat Jan 05, 2013 7:55 am
Forum: Personal Investments
Topic: firing my advisor, part 2
Replies: 26
Views: 2566

Re: firing my advisor, part 2

I give my thumbs up to Vanguard, and the firm is quite popular here. I see Fidelity pop up here often as well.

One consideration is if you want your funds under "one roof" if it is possible. My work-related investments (401K, etc.) had plenty of Vanguard funds. So, when I got around to setting up my IRA and taxable retirement accounts I stayed with them. I find having everything in one place easier to manage.

Good luck!
by jah
Fri Jan 04, 2013 8:23 pm
Forum: Personal Investments
Topic: Tax Loss Harvesting Question
Replies: 4
Views: 643

Re: Tax Loss Harvesting Question

livesoft wrote:I would consider waiting until just before the next major distribution to be paid by Wellington. Does it pay monthly or quarterly or something else?
I believe Wellington distributes quarterly, so should wait mid-March to sell. But, does time of the Wellington sale matter much. Yes, best to sell before a distribution, but not sure how much it matters if I sell now or two months from now.

Thanks for you help!
by jah
Fri Jan 04, 2013 9:08 am
Forum: Personal Investments
Topic: Tax Loss Harvesting Question
Replies: 4
Views: 643

Re: Tax Loss Harvesting Question

Perhaps you could explain what taxes hurt bad on the Wellington, because you're proposing to voluntarily incur taxes with a sale. VWENX produces a good deal of dividends - probably better suited for a tax-advantaged account. My thinking was to simplify my holdings by investing the VWENX proceeds in VTSAX and VTIAX, both of which produce far less dividends/share than VWENX. My idea for the sale - not sure if it is the correct way to go - is to try to match the capital-gains from the sale of VWENX and VIGAX with the capital-loss from the sale of VFH. Is this possible and, if so, is it something I should do to (1) simplify my portfolio and (2) negate the taxes associated with the sale of VWENX and VIGAX? You might also clarify "recent sa...
by jah
Fri Jan 04, 2013 3:15 am
Forum: Personal Investments
Topic: Tax Loss Harvesting Question
Replies: 4
Views: 643

Tax Loss Harvesting Question

Hello all! Writing again - this time in hopes of cleaning up some investing 'sins' I made in the past years. Sin #1 - Having ~$75,000 in VWENX (Wellington Admiral) in my taxable account. I like the fund and it has done okay for me (one of my first purchases many moons ago), but the taxes hurt bad relative to the alternatives. Sin #2 - A much bigger sin! Purchased 725 shares of VFH (Vanguard Financials ETF) some time ago. Stupid stupid me... :oops: So was wondering if I could partly fix this problem with tax loss harvesting. I have an unrealized long-term capital gain in the VWENX of ~$6,000 (short-term gain is negligible) and an unrealized long-term capital loss in VFH of ~$11,500 ( :oops: :oops: :oops:). I also have a realized long-term ca...
by jah
Wed Nov 21, 2012 9:31 pm
Forum: US Chapters
Topic: A THANKSGIVING TO REMEMBER
Replies: 18
Views: 2696

Re: A THANKSGIVING TO REMEMBER

Happy Thanksgiving to all!

I am thankful for finding this site and for the advice I received here.

Now if only the turkeys could be thankful for this holiday...

Jay
by jah
Wed Nov 21, 2012 8:58 pm
Forum: Personal Investments
Topic: 529 (TIAA-CREF Principal Plus Interest) vs I Saving Bonds
Replies: 7
Views: 1540

Re: 529 (TIAA-CREF Principal Plus Interest) vs I Saving Bond

The SavingsforCollege.com website says the tax exemption is not limited to the CA state plan, but this is something to definitely look into before choosing a plan. The CA plan is now run by TIAA-CREF (since 2011 I believe). I will give them a call and see if I open an out of state plan with them (TIAA-CREF runs plans in about 10 states) if distributions for college will be tax-exempt in CA. Will post their reply when I receive it. Would like to get back to my main question though - are I bonds (or EE bonds) a good (or better) alternative to using a 529 plan such as the TIAA-CREF Principal Plus Interest savings vehicle? You can't put as much away for education each year using the I (or EE) bonds, and you run into tax problems if your gross i...
by jah
Tue Nov 20, 2012 4:52 pm
Forum: Personal Investments
Topic: 529 (TIAA-CREF Principal Plus Interest) vs I Saving Bonds
Replies: 7
Views: 1540

Re: 529 (TIAA-CREF Principal Plus Interest) vs I Saving Bond

You didnt' ask this, but is there a reason you only want ultra-conservative investments for college? It seems likely that you will lose real purchasing power on a seriously compounded basis with this approach. I am looking at the ultra-conservative approach because a large portion of the money is already there for the child's education. My wife and I are simply trying to set aside the money and get a small amount of return out of it. We don't see the need to take much risk. However, I can see the reasoning on not being too conservative. Maybe throw half of the money into I bonds and the other half into something like the Total Bond Market Index Fund offered by the Vanguard 529. Besides, the two things I bonds have going for them are that u...