Search found 20328 matches

by grabiner
Sun Oct 22, 2017 8:28 am
Forum: Personal Consumer Issues
Topic: Costco auto buying service vs All State car buying services???
Replies: 12
Views: 1358

Re: Costco auto buying service vs All State car buying services???

I figure that dealers are happy to see a Costco, Truecar, buyer because they can make a decent deal for themselves without much hassle. I was just shopping for a new one and asked the salesman if they would sell for the Truecar price and gave him the number. He jumped on it right away without any n...
by grabiner
Sat Oct 21, 2017 11:00 pm
Forum: Personal Consumer Issues
Topic: Costco auto buying service vs All State car buying services???
Replies: 12
Views: 1358

Re: Costco auto buying service vs All State car buying services???

I figure that dealers are happy to see a Costco, Truecar, buyer because they can make a decent deal for themselves without much hassle. I was just shopping for a new one and asked the salesman if they would sell for the Truecar price and gave him the number. He jumped on it right away without any n...
by grabiner
Sat Oct 21, 2017 10:00 pm
Forum: Investing - Help with Personal Investments
Topic: TSP advice sought
Replies: 13
Views: 1010

Re: TSP advice sought

It appears he is in the 15% tax bracket (unless married). So investing 9k in Roth TSP is equal to investing $10.6k in traditional TSP. So it appears to me that traditional allows him to get a little more money into the system. But he will lose at least 15% of that traditional TSP money when he take...
by grabiner
Fri Oct 20, 2017 10:28 pm
Forum: Personal Finance (Not Investing)
Topic: Help Me Think About Roth Conversions and Retirement?
Replies: 17
Views: 1675

Re: Help Me Think About Roth Conversions and Retirement?

Besides the direct tax benefit, there are two other advantages for converting. If you pay for the conversion with funds from a taxable account, you effectively get more money into a tax-deferred account, since the IRS and state will no longer take part of your withdrawals. And you will reduce your R...
by grabiner
Fri Oct 20, 2017 10:20 pm
Forum: Personal Finance (Not Investing)
Topic: HSA taxation in Calif
Replies: 21
Views: 1614

Re: HSA taxation in Calif

Additionally, the invested part of my HSA I have invested in TIPS fund and the sweep fund is in federal money market, so at least the income is state tax free, and I only have to worry about the cap gains (And I don't reinvest dividends or cap gains automatically, to keep it simpler). Federal Money...
by grabiner
Fri Oct 20, 2017 10:13 pm
Forum: Personal Finance (Not Investing)
Topic: Credit scores fell this month a lot for no reason
Replies: 40
Views: 2353

Re: Credit scores fell this month a lot for no reason

You need to get reason codes from the source of the score; these will tell you the reasons your score is not higher, and the top reason is presumably why the score dropped, particularly if it wasn't the top reason last month. I encountered your phenomenon once on Credit Karma, with its old Trans Uni...
by grabiner
Fri Oct 20, 2017 9:44 pm
Forum: Investing - Help with Personal Investments
Topic: New to Investing- Portfolio Asset Allocation-Loan Repayment.
Replies: 5
Views: 276

Re: New to Investing- Portfolio Asset Allocation-Loan Repayment.

Welcome to the forum! Since you are currently getting partial forgiveness of interest, there is little point in paying extra on the loans now. Once the subsidy ends, paying down the loans is a risk-free 5.9% return. REPAYE loan forgiveness is unlikely to help you; with your high future salary, your ...
by grabiner
Fri Oct 20, 2017 9:25 pm
Forum: Investing - Theory, News & General
Topic: Regular Taxable Accounts vs Tax-Advantaged
Replies: 19
Views: 1795

Re: Regular Taxable Accounts vs Tax-Advantaged

With my tax deferred accounts, I am able to convert qualified dividends, which would be taxed at 15% in a taxable account, into Ordinary Income, which is federally taxed at 25-28% in my case... You aren't really losing money here. If you have $3000 to invest, you can put $4000 in your 401(k) in you...
by grabiner
Fri Oct 20, 2017 9:12 pm
Forum: Investing - Help with Personal Investments
Topic: Vanguard Moderate Growth Fund in taxable?
Replies: 6
Views: 545

Re: Vanguard Moderate Growth Fund in taxable?

The problem with any balanced fund in a taxable account is that it locks you into an allocation. If you want to sell bonds, or hold bonds in a different account, or hold a different type of bonds (say, you move to NY and want NY tax-exempt munis), you have to sell stocks at the same time, and pay a ...
by grabiner
Fri Oct 20, 2017 6:47 pm
Forum: Investing - Help with Personal Investments
Topic: To invest or not to invest
Replies: 6
Views: 571

Re: To invest or not to invest

Welcome to the forum! Get the full company match on your 401(k) first; that is free money. Beyond that, paying down the student loan is probably your best investment, because it is a risk-free return of 6.8%, which is a much better deal than you can get elsewhere; the low-risk funds in your 401(k) a...
by grabiner
Fri Oct 20, 2017 6:42 pm
Forum: Investing - Help with Personal Investments
Topic: Convert taxable to pre-tax?
Replies: 5
Views: 368

Re: Convert taxable to pre-tax?

It is usually a good idea to sell stock in your taxable account to fund a retirement account. You will lose some of the value of the stock to capital-gains tax, but you will lose more of the value to tax if you keep it in the taxable account, as dividends will be taxed and the capital gain when you ...
by grabiner
Fri Oct 20, 2017 6:35 pm
Forum: Investing - Help with Personal Investments
Topic: Tax optimization for stock sales
Replies: 3
Views: 306

Re: Tax optimization for stock sales

Sometimes, you want to maximize your total loss or minimize your total gain. At other times, you care about the difference between short-term and long-term. Specific identification allows you to decide which matters. For example, if you have loss carryovers which will offset all your gains, it doesn...
by grabiner
Thu Oct 19, 2017 8:53 pm
Forum: Investing - Theory, News & General
Topic: [favorite] Boglehead quotes
Replies: 76
Views: 10518

Re: [favorite] Boglehead quotes

From Allan Roth, at today's Bogleheads annual meeting:

"I charge people $450 an hour to tell them that I don't know the future."
by grabiner
Wed Oct 18, 2017 8:40 pm
Forum: Investing - Help with Personal Investments
Topic: VIMAX [unable to purchase from broker]
Replies: 6
Views: 447

Re: VIMAX [unable to purchase from broker]

Welcome to the forum! VIMAX is the Admiral share class of Vanguard Mid-Cap Index. Admiral shares of Vanguard funds cannot usually be purchased through brokerages. You can get the same holding at the same cost by buying the ETF share class, VO, which is also likely to be less expensive than the mutua...
by grabiner
Tue Oct 17, 2017 5:58 pm
Forum: Personal Finance (Not Investing)
Topic: IRA for H1B holders ?
Replies: 27
Views: 13384

Re: IRA for H1B holders ?

I'm on H1B and if I go back to my home country in the next few years and not withdraw the 401K until I'm 59.5 years. Would that be a beneficial move? I understand that I have to pay 30% tax. Is it 30% on the total amount you withdraw or only the earnings? Since none of the money has previously been...
by grabiner
Sun Oct 15, 2017 1:11 pm
Forum: Personal Finance (Not Investing)
Topic: Pay down mortgage or maintain liquidity for future home improvements
Replies: 10
Views: 1261

Re: Pay down mortgage or maintain liquidity for future home improvements

Pro: guaranteed return on the money (3.875% on the mortgage, or 2.5% after deduction), vs ~2.5% TEY on the munis with the associated risk. At these rates, you aren't gaining much by paying down the mortgage. While the munis have some risk, paying down the mortgage has a larger interest-rate risk be...
by grabiner
Sun Oct 15, 2017 12:52 pm
Forum: Investing - Theory, News & General
Topic: Which would you rather own: AAPL or S&P 600 Small Cap Index?
Replies: 57
Views: 3263

Re: Which would you rather own: AAPL or S&P 600 Small Cap Index?

It should be noted that there is one definition. According to the Investment Company Act of 1940, as summarized here , one of the regulatory requirements for mutual funds is that Mutual funds must declare themselves to be “diversified” or “non-diversified.” Generally, a diversified fund is required...
by grabiner
Sun Oct 15, 2017 12:44 pm
Forum: Investing - Theory, News & General
Topic: Long term government index fund...
Replies: 2
Views: 251

Re: Long term government index fund...

The problem with long-term Treasuries is that you are not adequately rewarded for the risk. Pension funds and insurance companies, with fixed-dollar long-term liabilities, are not subject to the risk, and will thus buy them at lower yields. Treasury bonds are excellent diversifiers, but you can get ...
by grabiner
Sun Oct 15, 2017 12:31 pm
Forum: Investing - Help with Personal Investments
Topic: Help me pick a fund for my HSA in California
Replies: 9
Views: 620

Re: Help me pick a fund for my HSA in California

Just like a Roth 401(k)/IRA, you want your HSA fund to be as large as possible in retirement as you may never need to pay tax on the money. Roth accounts and HSA accounts should be 100% equity in accumulation phase, with bonds held in tax-deferred or taxable (municipals). Even if you are taxed on t...
by grabiner
Sun Oct 15, 2017 12:22 pm
Forum: Investing - Help with Personal Investments
Topic: HSA investment [use guaranteed 4% or use equities]
Replies: 22
Views: 1417

Re: HSA investment [use guaranteed 4% or use equities]

I disagree. Roth accounts and HSAs should be filled with equities, with bonds being in tax-deferred or taxable (with municipals). Due to the tax-free growth and tax-free withdrawals (without RMDs), we want those accounts to be the largest. If you are in a 25% tax bracket, you will have exactly the ...
by grabiner
Sun Oct 15, 2017 12:13 pm
Forum: Personal Finance (Not Investing)
Topic: [HSA vs. PPO (Preferred Provider Organization) - which to select?]
Replies: 3
Views: 266

Re: [HSA vs. PPO (Preferred Provider Organization) - which to select?]

The most important part of this comparison is not financial: do the two plans have the same network? If you have a specialist you like, then you may not want to switch to a plan which forces you to find a new specialist. After that, compare the total costs. I like to start by comparing the day-one c...
by grabiner
Sun Oct 15, 2017 12:49 am
Forum: Investing - Help with Personal Investments
Topic: HSA investment [use guaranteed 4% or use equities]
Replies: 22
Views: 1417

Re: HSA investment [use guaranteed 4% or use equities]

Since you will be using the HSA for expenses in retirement, just as you will be using your IRA, view them as part of the same portfolio. You probably want to hold fixed-income somewhere. Since you can get a guaranteed 4% on the fixed income in your HSA, and nowhere near that in a low-risk investment...
by grabiner
Sun Oct 15, 2017 12:45 am
Forum: Investing - Help with Personal Investments
Topic: Should I dump VHDYX or VTMFX?
Replies: 4
Views: 578

Re: Should I dump VHDYX or VTMFX?

Introduction: I have two index funds VHDYX and VTMFX. Vanguard High Dividend fund is YTD 9.53%. However, I will have to pay taxes on gains and dividends. (aggressive, large cap fund) Vanguard Tax-Managed fund is 9.03%. But it is tax sheltered so I pay less in taxes (less aggressive, moderate balanc...
by grabiner
Sun Oct 15, 2017 12:37 am
Forum: Investing - Help with Personal Investments
Topic: Bonds in Taxable or tax advantaged?
Replies: 11
Views: 1001

Re: Bonds in Taxable or tax advantaged?

Given your high tax bracket, CA municipal bonds in a taxable account are probably best for you. The usual recommendation to put bonds in tax-deferred is based on a tax of 15% on qualified dividends and long-term gains. But your tax rate on qualified dividends is 23.8% federal, plus 11% state deducte...
by grabiner
Sun Oct 15, 2017 12:33 am
Forum: Investing - Help with Personal Investments
Topic: Help me pick a fund for my HSA in California
Replies: 9
Views: 620

Re: Help me pick a fund for my HSA in California

Since you are investing the HSA for long-term expenses, it should be invested as if it were part of your IRA. Thus, if Treasury bonds fit your investment needs, holding a Treasury fund will reduce your CA tax. You don't have to change your asset allocation to do this; if you hold Total Bond Market i...
by grabiner
Sun Oct 15, 2017 12:28 am
Forum: Investing - Help with Personal Investments
Topic: My EJ portfolio vs my Vanguard, side by side
Replies: 27
Views: 3137

Re: My EJ portfolio vs my Vanguard, side by side

You report returns since 2009, but you say that some of these funds did not exist in 2009. This suggests that you have changed your portfolio, and should not be counting past returns. If your advisor recommended a fund in 2014 which had good performance in the previous five years, and it has been on...
by grabiner
Fri Oct 13, 2017 9:31 pm
Forum: Investing - Theory, News & General
Topic: For those who prefer mortgages over cash: At what rate would that switch?
Replies: 8
Views: 1496

Re: For those who prefer mortgages over cash: At what rate would that switch?

I would think the 30 year safe withdraw rate would be a reasonable benchmark. The SWR studies (Trinity, etc) show that a 4% annual withdraw, even adjusted up annually for inflation, leaves you with nice gains for the vast majority of 30 year scenarios. This is not equivalent to a 4% annual return. ...
by grabiner
Thu Oct 12, 2017 6:20 pm
Forum: Personal Finance (Not Investing)
Topic: Which is the Most Tax-Efficient Method to Increase Your Cash Position?
Replies: 34
Views: 2284

Re: Which is the Most Tax-Efficient Method to Increase Your Cash Position?

You could sell $11,000 from your taxable investments, and put $5500 in cash in a Roth IRA now, and $5500 in January 2018. This would increase your tax-deferred savings, and you could withdraw the $11,000 at any time tax-free. You would pay some tax now by doing this, but you would reduce your future...
by grabiner
Thu Oct 12, 2017 5:52 pm
Forum: Investing - Theory, News & General
Topic: For those who prefer mortgages over cash: At what rate would that switch?
Replies: 8
Views: 1496

Re: For those who prefer mortgages over cash: At what rate would that switch?

My guideline is strictly mathematical. If you can get a better after-tax return on low-risk bonds of the same duration as the loan, then you can come out at the same risk level by investing the money. If you are considering not taking out the loan (paying cash for a house, or making a smaller down p...
by grabiner
Thu Oct 12, 2017 4:36 pm
Forum: Investing - Help with Personal Investments
Topic: Contribute to bad 457b or invest in taxable account?
Replies: 5
Views: 329

Re: Contribute to bad 457b or invest in taxable account?

Since you are planning to save this money for retirement anyway, you might as well put it in the 457 with the intention of rolling it over in two years. It doesn't matter much what it is invested in for those two years, since the primary benefit is many future years of tax-deferred growth.
by grabiner
Wed Oct 11, 2017 5:28 pm
Forum: Investing - Help with Personal Investments
Topic: Tax efficient fund placement help
Replies: 1
Views: 233

Re: Tax efficient fund placement help

Investing in a Roth IRA is a good deal, and you can always change what you hold there. If you have a 3-fund portfolio, you probably want to change the VOO for VTI (Vanguard Total Stock Market Index), which can be held in either the Roth IRA or in another account. Tax-deferred investment is better th...
by grabiner
Wed Oct 11, 2017 5:22 pm
Forum: Investing - Help with Personal Investments
Topic: Are we taking too much risk with Bonds in our AA?
Replies: 25
Views: 2048

Re: Are we taking too much risk with Bonds in our AA?

Hi everyone, I know that some can consider this as market timing.... However, we do know that the federal reserve started unwinding the recession stimulus. Additionally, we know that they are in the path of rising rates. Those are much more actionable today than in previous years. This stuff is alr...
by grabiner
Wed Oct 11, 2017 4:52 pm
Forum: Personal Finance (Not Investing)
Topic: HSA’s: What level of risk do you prefer?
Replies: 58
Views: 3772

Re: HSA’s: What level of risk do you prefer?

The difference is that you are converting tax-free dollars to tax-deferred dollars with no tax benefit . If you are in a 25% tax bracket with $3000 to invest, you can put $4000 in a traditional IRA, or $3000 in a Roth IRA; these are equivalent investments, as you will get $6000 from either one if t...
by grabiner
Tue Oct 10, 2017 7:18 pm
Forum: Investing - Theory, News & General
Topic: Financial Calculations for Boglehead Presentation
Replies: 14
Views: 1507

Re: Financial Calculations for Boglehead Presentation

If you would like to do an actual computation, you may want to use a spreadsheet; you can download OpenOffice for free. The advantage of the spreadsheet is that you can see the intermediate computations. You would have one row for each month, showing how the loan balance changes, and once the loan i...
by grabiner
Tue Oct 10, 2017 7:15 pm
Forum: Investing - Theory, News & General
Topic: Financial Calculations for Boglehead Presentation
Replies: 14
Views: 1507

Re: Financial Calculations for Boglehead Presentation

Just a quick word of caution as someone in the target demographic. I'm 34 w/ approximately $35K in total debt. It doesn't always make financial sense to pay it down as quickly as possible! My loan with the highest interest rate is @ 2.25% (fixed, about 10 years remaining). My largest debt is @ 0.9%...
by grabiner
Tue Oct 10, 2017 7:05 pm
Forum: Investing - Help with Personal Investments
Topic: Social Security - general question
Replies: 28
Views: 2473

Re: Social Security - general question

IF one has worked at or above the SS ceiling for 35 years and are collecting max SS now (started at age 70, etc.), and one keeps working, also above ceiling... can the SS benefit go below the then current max in the future? I had understood that the benefit *might* go up, albeit barely noticeably, ...
by grabiner
Tue Oct 10, 2017 6:54 pm
Forum: Investing - Help with Personal Investments
Topic: Rebalancing tax efficiently—and simply?
Replies: 7
Views: 732

Re: Rebalancing tax efficiently—and simply?

The one catch is that I was hoping to live off the funds currently in my taxable STAR fund for the first few years of retirement, hence my aim to allocate those funds more conservatively. During this time, I planned on leaving the more aggressively balanced STAR SEP-IRA alone in hopes of further ap...
by grabiner
Tue Oct 10, 2017 6:30 pm
Forum: Investing - Help with Personal Investments
Topic: Social Security - general question
Replies: 28
Views: 2473

Re: Social Security - general question

Is it correct to say that since I will have 35 earning years by the time I stop working at age 58, my benefit will remain at $1,000 when I begin taking it at age 62 (ignoring fine tuning between now and then)? I believe you are incorrect. SS online assumes you will continue to earn the same SS taxe...
by grabiner
Tue Oct 10, 2017 6:22 pm
Forum: Personal Finance (Not Investing)
Topic: HSA’s: What level of risk do you prefer?
Replies: 58
Views: 3772

Re: HSA’s: What level of risk do you prefer?

If all else is equal, it is slightly better to hold bonds in your HSA because this decreases the chance that your HSA will become too large for your medical expenses and will become taxable. Correct me if I am wrong, but I the event that HSA money grows too large, and the person is old enough (65) ...
by grabiner
Tue Oct 10, 2017 6:10 pm
Forum: Investing - Theory, News & General
Topic: Getting deeper small-cap value exposure in taxable is almost free
Replies: 31
Views: 4688

Re: Getting deeper small-cap value exposure in taxable is almost free

There are several ETF options for small-cap value investors. The funds which give better exposure to small-cap and value are not necessarily the best options, because they cost more; you might use a larger amount of a less expensive fund instead to get the same exposure. However, I noticed that the...
by grabiner
Mon Oct 09, 2017 8:36 pm
Forum: Personal Finance (Not Investing)
Topic: HSA’s: What level of risk do you prefer?
Replies: 58
Views: 3772

Re: HSA’s: What level of risk do you prefer?

My advice: If you are using your HSA for current medical expenses, keep one year's deductible in cash as part of your emergency fund. Anything beyond that is being invested for retirement expenses, so it should be treated as part of your IRA. If you are paying current expenses out of pocket and usin...
by grabiner
Mon Oct 09, 2017 8:31 pm
Forum: Investing - Theory, News & General
Topic: And the Nobel Memorial Prize in Economic Sciences goes to [Richard Thaler]
Replies: 84
Views: 6972

Re: And the Nobel Memorial Prize in Economic Sciences goes to [Richard Thaler]

Thaler on how he makes practical use of his work: Early in my teaching career I managed to get most of the students in my class mad at me. A midterm exam caused the problem. I wanted the exam to sort out the stars, the average Joes and the duds, so it had to be hard and have a wide dispersion of sc...
by grabiner
Mon Oct 09, 2017 8:25 pm
Forum: Investing - Theory, News & General
Topic: Has your "risk tolerance" been tested?
Replies: 105
Views: 6486

Re: Has your "risk tolerance" been tested?

I normally recommend not going with 100% stocks, even if that is mathematically right for you, unless your risk tolerance has been tested by an actual bear market. My test was in 2000-2002. I had 80% stock in 2000, and lost about 1/4 of my portfolio over the two years. Knowing how I reacted, I had a...
by grabiner
Mon Oct 09, 2017 8:22 pm
Forum: Investing - Help with Personal Investments
Topic: Risk of Long Term Government Bond Index Fund (VLGSX)
Replies: 12
Views: 848

Re: Risk of Long Term Government Bond Index Fund (VLGSX)

Thank yall very much. I knew there had to be more to duration that I wasn't understanding. I know this isn't a simple equation, but could someone provide a ballpark estimate of the percent loss of VLGSX if interest rates increased by 10% over a lets say 5 year period? Use a spreadsheet, which can c...
by grabiner
Mon Oct 09, 2017 8:11 pm
Forum: Investing - Help with Personal Investments
Topic: Please define "cash"
Replies: 31
Views: 1993

Re: Please define "cash"

I hope this doesn't muddy the waters too much, but it is also worth noting that debt is cash with a negative sign in front of it (as long as it is prepayable at any time without penalty). The opportunity to prepay your debt makes your debt a negative callable bond, not cash. If you have a bond whic...
by grabiner
Mon Oct 09, 2017 8:04 pm
Forum: Investing - Help with Personal Investments
Topic: creating low cost AA from 401k choices
Replies: 10
Views: 908

Re: creating low cost AA from 401k choices

It makes sense to view everything as one allocation. She could put this entire 401(k) in Vanguard's institutional and small-cap indexes, then hold bonds in her IRA, and international stock in your 401(k) or IRA so that the overall allocation comes out to what you want.
by grabiner
Mon Oct 09, 2017 7:41 pm
Forum: Personal Finance (Not Investing)
Topic: how to calculate whether to pay off mortgage
Replies: 21
Views: 2406

Re: how to calculate whether to pay off mortgage

Thanks Grabiner, your examples have been very helpful to me. If my desired asset allocation is 90% stock / 10% bond. Is it reasonable then to "hold" 10% of my portfolio as an early mortgage paydown? Ie.: my portfolio is 90,000 stock 10,000 bonds at 3.5% I now assume a 30 year fixed mortgage on a ho...
by grabiner
Mon Oct 09, 2017 7:34 pm
Forum: Investing - Help with Personal Investments
Topic: TSP to Vanguard?
Replies: 125
Views: 14646

Re: TSP to Vanguard?

This is not allowed. The TSP only allows you to roll over a monthly distribution to an IRA if the monthly distribution would exhaust the account in less than 120 months. I don't see how the TSP would know if you do a 60 day rollover. Or care. Or how they could have any control whatever happens to t...
by grabiner
Mon Oct 09, 2017 3:57 pm
Forum: Investing - Help with Personal Investments
Topic: TSP to Vanguard?
Replies: 125
Views: 14646

Re: TSP to Vanguard?

I suppose another work around would be to increase your TSP withdrawal to more than you need. Then every other month or every 3rd month roll that payment into a Vanguard IRA (using the 60 day rollover method). I think this could get tedious doing a rollover 4 to 6 times a year, but maybe not. This ...
by grabiner
Sat Oct 07, 2017 10:44 pm
Forum: Investing - Help with Personal Investments
Topic: Help with HSA
Replies: 4
Views: 574

Re: Help with HSA

If your HSA is with HSA Bank, it may be worth opening a linked TD Ameritrade account, so that you can hold a TIPS or Treasury ETF.