Search found 21780 matches

by grabiner
Sun Jul 15, 2018 8:16 pm
Forum: Investing - Theory, News & General
Topic: Math help: 401k vs debt payoff formula
Replies: 12
Views: 892

Re: Math help: 401k vs debt payoff formula

Next, 7% is not realistic for your 401k. However, the 7% return on the 401(k) is the wrong comparison, because it is a risky return. Paying off debt is a risk-free return, and buying munis is a low-risk return. I think it's reasonable to compare after-tax investments to risk-free returns like munis...
by grabiner
Sun Jul 15, 2018 5:12 pm
Forum: Investing - Help with Personal Investments
Topic: Single Investment Fund
Replies: 13
Views: 1594

Re: Single Investment Fund

The Life Strategy funds have a fixed allocation. The Target Date funds have a planned change in allocation over time and you should look at the allocation not the "date" in the name of the fund. Therefore, it is usually better to use the Target Retirement rather than the LifeStrategy funds in a tax...
by grabiner
Sun Jul 15, 2018 9:39 am
Forum: Personal Finance (Not Investing)
Topic: Braces: Keeping cost down and insurance questions.
Replies: 15
Views: 962

Re: Braces: Keeping cost down and insurance questions.

If you do not have a HDHP for your insurance, I would suggest checking to see if your employer offers a healthcare FSA. Even if you do have a HDHP, check whether you have a limited-purpose FSA, usable for only dental and vision; this would allow you to put in $2500 towards braces or other dental co...
by grabiner
Sun Jul 15, 2018 8:53 am
Forum: Investing - Theory, News & General
Topic: Math help: 401k vs debt payoff formula
Replies: 12
Views: 892

Re: Math help: 401k vs debt payoff formula

I often run into threads, where I was unable to qualitatively put the yield on debt payoff vs 401k saving. The below math is what I struggle to understand which might help explain my point to new members well. Lets take an example: 1) Debt is at 6%. so the yield in this case is 6% 2) For 401k at 35...
by grabiner
Sun Jul 15, 2018 8:22 am
Forum: Investing - Help with Personal Investments
Topic: Single Investment Fund
Replies: 13
Views: 1594

Re: Single Investment Fund

Since the Tax-Managed Balanced fund (VTMFX) comes closer to my desired asset allocation of 50/50, I still am asking whether or not this could be an appropriate fund for my tax deferred IRA account. I am not a higher-income individual that is referred to in their fund description, but just looking f...
by grabiner
Sat Jul 14, 2018 2:55 pm
Forum: Personal Consumer Issues
Topic: Someone is using my cellphone number
Replies: 21
Views: 2735

Re: Someone is using my cellphone number

I've made up a phone number when filling out forms where the phone number is mandatory many many times over the years and where I don't wish to ever receive a call. Dumb luck that I got yours. I apologize. :sharebeer When I need to do this, I give (410)555-1212. This is not anyone's home number, bu...
by grabiner
Fri Jul 13, 2018 11:00 pm
Forum: Investing - Help with Personal Investments
Topic: 1031 exchange into DST or pay taxes to pay down debt?
Replies: 3
Views: 299

Re: 1031 exchange into DST or pay taxes to pay down debt?

How long are the terms of your loans? If you have, say, a 4.5% mortgage which is not deductible, then paying it down is a risk-free, long-term 4.5% return. The fair investment return on a low-risk, long-term investment is 2.85%, which is the yield on Admiral shares of Vanguard Long-Term Tax-Exempt. ...
by grabiner
Thu Jul 12, 2018 9:10 pm
Forum: Investing - Theory, News & General
Topic: Bonds in rising interest rate environment
Replies: 12
Views: 1024

Re: Bonds in rising interest rate environment

The federal funds rate which is in the news is a very-short-term rate, which is not directly connected to the rates on intermediate-term bonds. In addition, bond rates are set by bond traders, who already know about projected increases in rates. If traders expect interest rates on interrmediate-term...
by grabiner
Thu Jul 12, 2018 8:46 pm
Forum: Investing - Help with Personal Investments
Topic: when is it better to take short term capital gain
Replies: 6
Views: 690

Re: when is it better to take short term capital gain

If you have capital losses exceeding your gains, it doesn't matter whether your gain is short-term or long-term (unless you have both types of gains in the year that your carryovers run out). Therefore, it is worth taking a short-term gain instead of a slightly larger long-term gain.
by grabiner
Thu Jul 12, 2018 8:34 pm
Forum: Investing - Help with Personal Investments
Topic: Time for a taxable account? HSA?
Replies: 4
Views: 495

Re: Time for a taxable account? HSA?

2. HSA earnings are taxed as regular income in CA so I would recommend you use them to help fill your bond allocation (if you have one) instead As to #2 why bonds? Since CA treats the HSA as a normal taxable account would not the normal advice be to use tax efficient equity funds instead? Like the ...
by grabiner
Thu Jul 12, 2018 7:48 pm
Forum: Investing - Help with Personal Investments
Topic: Thoughts on using an ETF for TIPS investing
Replies: 11
Views: 931

Re: Thoughts on using an ETF for TIPS investing

I have a follow-up question: The main reason ETFs appeal to me rather than just buying TIPS directly is that I had the impression those shares could be bought and sold without regard to the length of terms of the TIPS held in the fund, making the funds a bit more liquid. Was I confused about that? ...
by grabiner
Wed Jul 11, 2018 9:14 pm
Forum: Investing - Theory, News & General
Topic: Larry Swedroe: Look Past Expense Ratios
Replies: 71
Views: 5701

Re: Larry Swedroe: Look Past Expense Ratios

Tax efficiency is also likely to tilt the scales toward the ETFs; so again, IJS and RZV. Comparing IJS and RZV, we see that RZV buys you more HML per dollar. This is partially offset by the fact that RZV has a much lower liquidity which translates into a higher bid/ask spread ( 0.27% for RZV vs 0.0...
by grabiner
Wed Jul 11, 2018 9:05 pm
Forum: Investing - Theory, News & General
Topic: Question About Interaction Between Buy & Sell Limit Orders
Replies: 5
Views: 375

Re: Question About Interaction Between Buy & Sell Limit Orders

What usually happens when orders cross is that the trade happens at the price of the first order placed. This makes it practical to place a limit order to buy above the current ask. If I have placed an order to sell 500 shares at $20 which is the best offer, and you want to buy 1000 shares, you can ...
by grabiner
Wed Jul 11, 2018 8:36 pm
Forum: Investing - Help with Personal Investments
Topic: Thoughts on using an ETF for TIPS investing
Replies: 11
Views: 931

Re: Thoughts on using an ETF for TIPS investing

Welcome to the forum! There is no free lunch in the market. The higher the yield on your bonds, the more risk of some type you will take, so you have to decide whether taking that risk is worthwhile. Note that I said, "in the market". Outside your IRA, you can buy I-Bonds, which are not traded in th...
by grabiner
Wed Jul 11, 2018 7:42 pm
Forum: Investing - Theory, News & General
Topic: "The Fund is classified as non-diversified"
Replies: 44
Views: 4938

Re: "The Fund is classified as non-diversified"

From the Investment Company Act of 1940: (1) ‘‘Diversified company’’ means a management company which meets the following requirements: At least 75 per centum of the value of its total assets is represented by cash and cash items (including receivables), Government securities, securities of other i...
by grabiner
Tue Jul 10, 2018 6:42 pm
Forum: Investing - Help with Personal Investments
Topic: What % of your equity is int’l?
Replies: 141
Views: 7480

Re: What % of your equity is int’l?

There is a philosophy in Computer Science / Software Engineering that there are in general 3 "natural" numbers that should be used in programming: 0, 1, and infinity. Anything else better have a damn good justification. So with that in mind, I see an analogous answer to this question but with only ...
by grabiner
Tue Jul 10, 2018 6:34 pm
Forum: Investing - Theory, News & General
Topic: Wellesley alternative for taxable acct.?
Replies: 25
Views: 2814

Re: Wellesley alternative for taxable acct.?

Vanguard does have a Tax Managed Balanced Fund, which is at about 50% stock. However, it is very different from Wellesley in the type of stocks it contains (blend instead of value). In spite of the fact that you like Wellesley, I'm not sure you are actually looking for something classified as "valu...
by grabiner
Mon Jul 09, 2018 10:16 pm
Forum: Investing - Theory, News & General
Topic: Wellesley alternative for taxable acct.?
Replies: 25
Views: 2814

Re: Wellesley alternative for taxable acct.?

There are no alternatives that will give you what ever it is you are looking for in wellesley. If you want wellesley then you have to decide if the tax situation is worth it. If not then pick something else. I think OP is asking what is the "something else"? OP could consider something like 40% Van...
by grabiner
Sun Jul 08, 2018 7:57 pm
Forum: Investing - Theory, News & General
Topic: Wellesley alternative for taxable acct.?
Replies: 25
Views: 2814

Re: Wellesley alternative for taxable acct.?

If you want just one fund, LifeStrategy Conservative Growth has a similar allocation, and would be OK in a low tax bracket.

If you want to replicate Wellesley's value bias, use Value Index for the stock portion, and either a corporate or muni fund for the bond portion depending on your tax bracket.
by grabiner
Sun Jul 08, 2018 7:51 pm
Forum: Investing - Help with Personal Investments
Topic: Re-casting mortgage
Replies: 11
Views: 1249

Re: Re-casting mortgage

Hi All: Recently, we purchased a house in a HCOL area. My monthly mortgage is ~6k. While we can afford this, I do want to reduce this to more manageable levels. Our mortgage interest rate is 3.875 on a 30-year fixed rate loan. I have ~$250k additional funds that I did not use for the downpayment. M...
by grabiner
Sun Jul 08, 2018 7:46 pm
Forum: Investing - Help with Personal Investments
Topic: ? on scholarship being able writeoff
Replies: 2
Views: 303

Re: ? on scholarship being able writeoff

Do you have a taxable investment account? If so, you might donate $70K worth of stock with long-term gains, and reinvest your monther's $70K into similar stock. This will get rid of the long-term gain for future tax savings. But check your tax situation before you do this (and check with your tax ad...
by grabiner
Sun Jul 08, 2018 7:29 pm
Forum: Investing - Help with Personal Investments
Topic: In what order should I sell tax lots during rebalancing?
Replies: 6
Views: 782

Re: In what order should I sell tax lots during rebalancing?

If you are selling for a loss, you should sell for the largest loss; it doesn't matter much whether a loss is short-term or long-term. (Short-term losses are better if you have both short-term and long-term gains in the same year, and your gains exceed your losses.) If you are selling for a gain, bu...
by grabiner
Sun Jul 08, 2018 7:21 pm
Forum: Investing - Help with Personal Investments
Topic: What bond funds do you use for taxable accounts?
Replies: 20
Views: 2161

Re: What bond funds do you use for taxable accounts?

What bond funds would you use for a taxable account for a high tax bracket investor? Intermediate-Term Tax-Exempt is the most similar in risk to Total Bond Market, so it should be the default holding. If Vanguard has a fund for your state, you might put half your bonds in that state's long-term fun...
by grabiner
Sun Jul 08, 2018 7:02 pm
Forum: Investing - Help with Personal Investments
Topic: Bond portion of taxable
Replies: 4
Views: 529

Re: Bond portion of taxable

Welcome to the forum! However bonds have always been a bit more confusing for me. If bonds are suppose to be used for capital preservation, why use high yield and emerging market bonds which come at greater default risk? High-yield bonds behave like a mixture of stock and bond; if you hold 20% of yo...
by grabiner
Sun Jul 08, 2018 6:54 am
Forum: Investing - Help with Personal Investments
Topic: Mortgage payoff vs TIAA Traditional
Replies: 7
Views: 609

Re: Mortgage payoff vs TIAA Traditional

See Paying down loans versus investing on the wiki. TIAA Traditional is a fixed-income investment with an effective duration of 4.5 years, as you can withdraw money 1/10 now and 1/10 each year for the next nine years. Paying down your mortgage is a fixed-income investment with an effective duration ...
by grabiner
Sat Jul 07, 2018 10:54 pm
Forum: Investing - Help with Personal Investments
Topic: VGTSX in Traditional IRA-Convert to Roth?
Replies: 12
Views: 764

Re: VGTSX in Traditional IRA-Convert to Roth?

If you can't roll the traditional IRA into an employer plan, it is probably worth converting. If you don't convert it now, you will have to convert it when you need a backdoor Roth, and you'll probably be in a higher tax bracket then. And if you never need a backdoor Roth, you still simplify your p...
by grabiner
Sat Jul 07, 2018 10:35 pm
Forum: Investing - Help with Personal Investments
Topic: Tax-friendlier alternatives to Vanguard Extended Market?
Replies: 22
Views: 1988

Re: Tax-friendlier alternatives to Vanguard Extended Market?

The challenge with holding equities in the 401k is that I'm running out of space for fixed income. I hold equities in Roth, but Roth size is relatively small. I also hold Total International (VXUS), but it has a high dividend yield (and a somewhat high percentage of that is nonqualified), so I've p...
by grabiner
Sat Jul 07, 2018 10:31 pm
Forum: Investing - Help with Personal Investments
Topic: Right decision ?
Replies: 20
Views: 2506

Re: Right decision ?

If you completely depleted your emergency fund in order to pay off a 3.75% loan then I think you made a mistake. On the other hand, if you have sufficient emergency funds remaining and are so risk-averse that any volatility keeps you up at night, and if the entirety of your portfolio will let you m...
by grabiner
Sat Jul 07, 2018 10:17 am
Forum: Personal Finance (Not Investing)
Topic: Is Social Security income included in MAGI for determination of medicare high income adjustment fee?
Replies: 9
Views: 1264

Re: Is Social Security income included in MAGI for determination of medicare high income adjustment fee?

The Wizard wrote:
Sat Jul 07, 2018 8:03 am
Only the taxable part of SS is included in your MAGI for that purpose.
This will vary from 0% to 85% of your total SS benefits depending on the amount of other income...
And it should be 85% for almost everyone affected by IRMAA.
by grabiner
Sat Jul 07, 2018 10:09 am
Forum: Investing - Theory, News & General
Topic: Tradional IRA conversion to ROTH IRA taxable amount?
Replies: 32
Views: 1361

Re: Tradional IRA conversion to ROTH IRA taxable amount?

I am on a pay as you earn student loan plan. My monthly student loan is calculated based on my income. When I first started working my income was low and I was not married at the time so my monthly student loan payment was based off my low income. As my income increased so did the amount I owed eac...
by grabiner
Sat Jul 07, 2018 9:53 am
Forum: Investing - Theory, News & General
Topic: Fund Spy - The Vanguard Group Rules
Replies: 6
Views: 1220

Re: Fund Spy - The Vanguard Group Rules

This one surprised me: Finally, Vanguard could do more to encourage its managers, active as well as passive, to invest alongside fundholders. According to Morningstar data, the percentage of Vanguard’s U.S. assets in which at least one manager has more than $1 million invested stands at 12%. Even c...
by grabiner
Sat Jul 07, 2018 9:04 am
Forum: Investing - Help with Personal Investments
Topic: VGTSX in Traditional IRA-Convert to Roth?
Replies: 12
Views: 764

Re: VGTSX in Traditional IRA-Convert to Roth?

If you can't roll the traditional IRA into an employer plan, it is probably worth converting. If you don't convert it now, you will have to convert it when you need a backdoor Roth, and you'll probably be in a higher tax bracket then. And if you never need a backdoor Roth, you still simplify your po...
by grabiner
Sat Jul 07, 2018 8:58 am
Forum: Investing - Help with Personal Investments
Topic: Right decision ?
Replies: 20
Views: 2506

Re: Right decision ?

If you completely depleted your emergency fund in order to pay off a 3.75% loan then I think you made a mistake. On the other hand, if you have sufficient emergency funds remaining and are so risk-averse that any volatility keeps you up at night, and if the entirety of your portfolio will let you m...
by grabiner
Fri Jul 06, 2018 11:01 am
Forum: Investing - Help with Personal Investments
Topic: Expected windfall that I currently manage?
Replies: 7
Views: 1381

Re: Expected windfall that I currently manage?

As I said, I did not really pick those funds as they are pre-existing. Large amounts of dividends seems like a good thing, I understand they are taxed as income and the same bracket, but what do you mean by non-qualified in this instance or this fund? Qualified dividends, from most stocks, are taxe...
by grabiner
Thu Jul 05, 2018 11:13 pm
Forum: Personal Finance (Not Investing)
Topic: Advice on paying off Mortgage and/or Car?
Replies: 6
Views: 843

Re: Advice on paying off Mortgage and/or Car?

My dear Bogleheads friends, my wife and I would be very interested in your advice. We owe mortgage of $960 per month on $103,300 at 4.0% for the next 17 yrs We owe car payment of $414 per month on $23,326 at 2.59% for the next 5 yrs See Paying down loans versus investing on the wiki. You have enoug...
by grabiner
Thu Jul 05, 2018 11:03 pm
Forum: Personal Finance (Not Investing)
Topic: paying off mortgage while I have high income?
Replies: 11
Views: 1866

Re: paying off mortgage while I have high income?

I'm thinking in the same direction. As my cash position increases we may well make some payments on the principle from time to time, but probably not pay it all down at once. Mortgage balance is $180,000 at 2.75%, and income is in the $275,000 range. At 4.6%, prepaying part of the mortgage can make...
by grabiner
Thu Jul 05, 2018 10:53 pm
Forum: Personal Finance (Not Investing)
Topic: Need advice on Tax Savings
Replies: 7
Views: 672

Re: Need advice on Tax Savings

Welcome to the forum! If you are over the IRA contribution limit, consider a Backdoor Roth IRA . If you have a qualifying high-deductible health plan, you can invest in a Health savings account , and leave the money there to save for medical costs in retirement. If you have children, you can save fo...
by grabiner
Thu Jul 05, 2018 10:47 pm
Forum: Investing - Theory, News & General
Topic: Statistically significant alpha?
Replies: 26
Views: 1693

Re: Statistically significant alpha?

I'm a straight indexer. T R Price Blue Chip Growth (TRBCX) was brought to my attention. I ran it through Portfoliovisualizer and it's linked here https://tinyurl.com/y8q9yq85. My once good college statistics are long gone. With a t-stat of 2.3, would the conclusion be significant? Not given the sam...
by grabiner
Thu Jul 05, 2018 10:38 pm
Forum: Investing - Theory, News & General
Topic: Invest less and pay down mortgage ?
Replies: 23
Views: 1631

Re: Invest less and pay down mortgage ?

—Have about 34k left on a 30year fixed mortgage, 3.375% —I regularly max out my Roth IRA but don’t make enough to max out a 401k. At that low a rate, it's better to contribute more to the 401(k) than to pay down the mortgage, assuming you have a decent 401(k). You can earn 3.12% on Total Bond Marke...
by grabiner
Thu Jul 05, 2018 10:30 pm
Forum: Investing - Theory, News & General
Topic: Why does VXF hold so much cash? [Vanguard Extended Market ETF]
Replies: 10
Views: 828

Re: Why does VXF hold so much cash? [Vanguard Extended Market ETF]

Hi, VXF has a massive 11% turnover ratio!!! Is that alarming and is that detrimental to the fund performance? VXF tracks an index, and has to sell stocks when they leave the index. Small-cap and mid-cap indexes thus have more turnover than large-cap indexes. However, this is not detrimental to inve...
by grabiner
Thu Jul 05, 2018 10:25 pm
Forum: Investing - Theory, News & General
Topic: Comparing bonds with different maturities
Replies: 6
Views: 482

Re: Comparing bonds with different maturities

I would normally assume the market is efficient. If 10-year-bond yields and 5-year-bond yields are the same, this means that whoever is buying the 10-year bond must expect lower yields over the second 5 years. (If rates were expected to be stable, the 10-year bond would have a higher yield because i...
by grabiner
Thu Jul 05, 2018 10:16 pm
Forum: Investing - Help with Personal Investments
Topic: Can't participate in 401k for 1 year
Replies: 33
Views: 2409

Re: Can't participate in 401k for 1 year

Just for this year put $5500 into a Roth IRA account for both you and your wife. Next year invest max in your 401k and the Roth for for you and your wife if you can. If you are not "covered" by your employer plan (check the rules), you can contribute to a traditional IRA and deduct the contribution...
by grabiner
Thu Jul 05, 2018 10:14 pm
Forum: Investing - Help with Personal Investments
Topic: Expected windfall that I currently manage?
Replies: 7
Views: 1381

Re: Expected windfall that I currently manage?

VWEAX - 15% VWEAX is a high yield corporate bond fund. Having 15% of the portfolio in bonds is arguably OK, but given that it's a bonus/windfall and the goal is to maximize the value, I would argue for a 100% stock allocation. This is a poor bond fund for a taxable investment. It generates large am...
by grabiner
Thu Jul 05, 2018 10:07 pm
Forum: Investing - Help with Personal Investments
Topic: Tax-deductible 403b vs. taxable Vanguard ETF
Replies: 17
Views: 877

Re: Tax-deductible 403b vs. taxable Vanguard ETF

2.5% annual fees are extremely high. However, that is only one part of the cost; how long are you paying those fees? When you leave the employer, you can roll your 403(b) into an IRA, getting the benefit of low fees while keeping the tax deferral. My rule of thumb is to consider taxable investments ...
by grabiner
Thu Jul 05, 2018 9:59 pm
Forum: Investing - Help with Personal Investments
Topic: Tax-friendlier alternatives to Vanguard Extended Market?
Replies: 22
Views: 1988

Re: Tax-friendlier alternatives to Vanguard Extended Market?

\1) Risk of Vanguard shutting down Vanguard Tax-Managed Small-Cap Admiral fund? This is a fairly small fund for Vanguard ($6B assets) and is offered only as Admiral (no Investor, no ETF). This fund has been around a long time, but what are the odds (your best guess) that Vanguard would shut down th...
by grabiner
Thu Jul 05, 2018 9:53 pm
Forum: Investing - Help with Personal Investments
Topic: My student loan or kids' 529?
Replies: 7
Views: 606

Re: My student loan or kids' 529?

Another way to look at this is that the student loan payments will have to be made sometime. If you pay $8000 against your student loan this year, and another $8000 next year, you will have $16,000 plus interest in future years that is not going to the student loans, and is instead going to your 401...
by grabiner
Thu Jul 05, 2018 9:48 pm
Forum: Investing - Help with Personal Investments
Topic: Starting Bogle method with 300K (1 string attached)
Replies: 14
Views: 2027

Re: Starting Bogle method with 300K (1 string attached)

I'm glad I read this thread! I didn't know bond funds were frowned upon in taxable threads. I have about 12k of BND in my taxable vanguard account. Would like to exchange it for VTEB instead (I'm in the highest tax bracket in California). Is there a smart way to do this to minimize distributions/ta...
by grabiner
Thu Jul 05, 2018 9:45 pm
Forum: Investing - Theory, News & General
Topic: If you tilt toward Small Cap Value, how much do you tilt?
Replies: 38
Views: 2563

Re: If you tilt toward Small Cap Value, how much do you tilt?

Just curious, are you guys with significant SCV tilts lowering your equity exposure overall as well? Or are you comfortable with the higher overall volatility? I do view small-cap, and value, and emerging markets, as an additional risk; I prefer to do this while keeping a bond allocation, rather th...
by grabiner
Wed Jul 04, 2018 2:23 pm
Forum: Investing - Theory, News & General
Topic: Emerging Market Vanguard “select fund”
Replies: 4
Views: 554

Re: Emerging Market Vanguard “select fund”

The Select Funds aren't the funds Vanguard expects to do best (as the "selected funds" from an industry publication might be). Rather, they are the funds which Vanguard believes are the natural choices to build a diversified portfolio around. This includes indexes in the main asset classes, and a se...
by grabiner
Wed Jul 04, 2018 2:04 pm
Forum: Investing - Theory, News & General
Topic: Admiral Shares vs Investor Shares?
Replies: 36
Views: 37603

Re: Admiral Shares vs Investor Shares?

Why do most Vanguard funds with investor and admiral shares show higher returns for investor shares vs admiral shares? You may be looking at since-inception returns for different share classes, which is not a fair comparison. Over a single day, Investor shares can outperform because of rounding, If...