Search found 11084 matches

by The Wizard
Mon Jan 22, 2018 8:09 pm
Forum: Investing - Theory, News & General
Topic: Backdoor Roth / step-transaction doctrine news: [Congress recognizes process]
Replies: 17
Views: 1313

Re: "Congress put its stamp of approval on [backdoor Roth]" - Forbes

sport wrote:
Mon Jan 22, 2018 7:46 pm
Gronnie wrote:
Mon Jan 22, 2018 7:30 pm
So why don't they just explicitly remove the income restriction?
It's the government. It doesn't have to make sense.
Main issue with that restriction is that it prevents higher income older folks (>70) from contributing earned income to their Roth IRA.
Maybe that's what Congress wants...
by The Wizard
Mon Jan 22, 2018 12:16 pm
Forum: Investing - Theory, News & General
Topic: Does a Wider rebalancing band not make more sense?
Replies: 20
Views: 1590

Re: Does a Wider rebalancing band not make more sense?

The optimal points, in terms of return, are to rebalance from bonds to stocks at the bottom of a decline and from stocks to bonds at the top of a peak. The closer your rebalancing points are to these optimal points, the better your rebalancing strategy will look in comparison to other reblancing st...
by The Wizard
Mon Jan 22, 2018 10:31 am
Forum: Investing - Help with Personal Investments
Topic: Ready to give up on bond fund, Lost 2.25% past 6 months
Replies: 68
Views: 7071

Re: Ready to give up on bond fund, Lost 2.25% past 6 months

Over last six months from 7/22/17, $10,000 of swagx has "grown" to $9963.79, per M* charts.
This is a decline of 0.36%, not 2%+...
by The Wizard
Mon Jan 22, 2018 10:17 am
Forum: Investing - Help with Personal Investments
Topic: 4% Rule Clarification in regard to taxes
Replies: 6
Views: 945

Re: 4% Rule Clarification in regard to taxes

In my case, I just targeted the same net taxable income in retirement as when working, 1099-R vs W-2. So there was less confusion on this issue. Others with more diversified portfolios will need to think differently... That's a bit high, unless you are discounting savings as well. That's something ...
by The Wizard
Mon Jan 22, 2018 8:14 am
Forum: Investing - Help with Personal Investments
Topic: Ready to give up on bond fund, Lost 2.25% past 6 months
Replies: 68
Views: 7071

Re: Ready to give up on bond fund, Lost 2.25% past 6 months

...What is the duration? In rough general terms, it means that the fund is fairly safe, very unlikely to lose money, if you hold it that long ... Well, sort of. So if there's a step increase in bond rates this week, then that fund sees a NAV decline that takes 5.8 years to recover gradually. Except...
by The Wizard
Mon Jan 22, 2018 6:23 am
Forum: Investing - Help with Personal Investments
Topic: 4% Rule Clarification in regard to taxes
Replies: 6
Views: 945

Re: 4% Rule Clarification in regard to taxes

In my case, I just targeted the same net taxable income in retirement as when working, 1099-R vs W-2.
So there was less confusion on this issue.

Others with more diversified portfolios will need to think differently...
by The Wizard
Sun Jan 21, 2018 6:11 pm
Forum: Personal Finance (Not Investing)
Topic: Question re 2018 tax rates
Replies: 13
Views: 1446

Re: Question re 2018 tax rates

I was looking at the 2018 tax tables and I would like to confirm my understanding about something for couples that are filing jointly and not itemizing deductions. • There is a $24,000 exemption • The 12% tax rate tops out at $77,400 I am assuming this means that a married couple could have $101,40...
by The Wizard
Sun Jan 21, 2018 1:27 pm
Forum: Personal Finance (Not Investing)
Topic: Figuring your tax bracket
Replies: 24
Views: 1803

Re: Figuring your tax bracket

OP might want to clarify why he wants to know his marginal tax bracket. There are various reasons why this info could be helpful. In my case, for instance, I had some part-time work two years ago on top of my normal retirement income. So I needed to know how much to withhold for Federal taxes to com...
by The Wizard
Sun Jan 21, 2018 10:35 am
Forum: Investing - Help with Personal Investments
Topic: How to invest funds for retirement?
Replies: 15
Views: 1305

Re: How to invest funds for retirement?

Well, here's a post I never thought I'd make. :happy ... This is an excellent post. OP is considering working for ten more years. OP should start modelling their combined retirement income at some point. Normally I recommend doing this around five years prior to retirement, when certain numbers bec...
by The Wizard
Sun Jan 21, 2018 9:45 am
Forum: Personal Finance (Not Investing)
Topic: Can Roth conversions count as RMDs?
Replies: 27
Views: 1678

Re: Can Roth conversions count as RMDs?

Isn't the theory on this that generally the best time to try and do conversions is after 59.5 and up to 70.5 (i.e. after withdrawal without penalty and before RMD), so long as the amounts withdrawn (to be converted) are such that they do not take you to an unacceptably higher income tax bracket? Mo...
by The Wizard
Sun Jan 21, 2018 1:59 am
Forum: Personal Finance (Not Investing)
Topic: Can Roth conversions count as RMDs?
Replies: 27
Views: 1678

Re: Can Roth conversions count as RMDs?

Is 70 the oldest someone can contribute or convert anything to a Roth? No. Those older than 70 can Roth convert funds remaining in their tIRA beyond the RMD for the year. I believe that if somebody is still working, they also can contribute to a Roth (I really don't know, because I FIREd long befor...
by The Wizard
Sat Jan 20, 2018 9:50 pm
Forum: Personal Finance (Not Investing)
Topic: Can Roth conversions count as RMDs?
Replies: 27
Views: 1678

Re: Can Roth conversions count as RMDs?

So you cannot roll over a RMD to an after tax nondeductible IRA and convert to Roth? What then are options for the RMD if you don't need all the money, but want to keep the assets invested for future growth/heirs. Is taxable the only option and there's no way to get this in a Roth?? You get money i...
by The Wizard
Sat Jan 20, 2018 7:00 pm
Forum: Local Chapters and Bogleheads Community
Topic: Roll Call for the Retirement Class of 2018!
Replies: 82
Views: 10660

Re: Roll Call for the Retirement Class of 2018!

I have a question for the class of 2018 since I may be joining it mid year. I keep reading that you need 85% of your pay. Is that my gross pay or after my 401K contribution and SS tax? We should start a separate thread on that, stumpy. The answer depends on how much of your gross pay you have been ...
by The Wizard
Sat Jan 20, 2018 6:27 pm
Forum: Personal Finance (Not Investing)
Topic: Figuring your tax bracket
Replies: 24
Views: 1803

Re: Figuring your tax bracket

Really your tax bracket is only part of the picture. I assume you want to know what happens to your taxes when you do something. The important number for decisions about IRAs, roth conversion etc, is your marginal tax rate. There are a lot more moving parts to marginal tax rate that tax bracket. Th...
by The Wizard
Sat Jan 20, 2018 1:32 pm
Forum: Personal Finance (Not Investing)
Topic: Figuring your tax bracket
Replies: 24
Views: 1803

Re: Figuring your tax bracket

fortfun wrote:
Sat Jan 20, 2018 12:56 pm
...Or, what line on your tax return is used to determine your tax bracket?
The Taxable Income line on form 1040, in conjunction with that year's tax bracket table...
https://taxfoundation.org/2017-tax-brackets/
by The Wizard
Sat Jan 20, 2018 1:29 pm
Forum: Personal Finance (Not Investing)
Topic: Figuring your tax bracket
Replies: 24
Views: 1803

Re: Figuring your tax bracket

And even though my Federal tax bracket is 28% for 2017 and 24% for 2018, my marginal tax rate could be different, depending on a number of things...
by The Wizard
Sat Jan 20, 2018 1:25 pm
Forum: Personal Finance (Not Investing)
Topic: Figuring your tax bracket
Replies: 24
Views: 1803

Re: Figuring your tax bracket

Wrong.
Most people try to figure just their Federal income tax bracket, or maybe Federal+State.
What you're doing is figuring take-home pay as a percentage of gross pay...
by The Wizard
Sat Jan 20, 2018 11:18 am
Forum: Investing - Theory, News & General
Topic: 10 years expenses in FI
Replies: 49
Views: 4763

Re: 10 years expenses in FI

I agree that dbr's downplaying the Sleep Factor may not be agreeable to everyone. But I agree with the rest of the concept: Namely, just manage risk by adjusting your AA according to a reasonable plan. While I'm content with around 60% stocks in retirement, others will sleep better with 40% or less....
by The Wizard
Sat Jan 20, 2018 10:49 am
Forum: Personal Finance (Not Investing)
Topic: Stats on When People Take Social Security
Replies: 173
Views: 11447

Re: Stats on When People Take Social Security

If you are a single female, you are somewhat shortchanged by early SS since the tables SSA uses are unisex and females, on average, live longer. Since a single female gets the same monthly benefit as a single male of same age and SS payments in, & on average females live longer, they are not gettin...
by The Wizard
Fri Jan 19, 2018 5:52 pm
Forum: Personal Finance (Not Investing)
Topic: Which tax software for 2017?
Replies: 20
Views: 1123

Re: Which tax software for 2017?

FreeTaxUSA works for me...
by The Wizard
Fri Jan 19, 2018 3:03 pm
Forum: Personal Finance (Not Investing)
Topic: Federal tax estimator that includes Social Security income?
Replies: 19
Views: 1979

Re: Federal tax estimator that includes Social Security income?

Yes, looks like Intuit updated Taxcaster for 18. You input your info and it spits out 2 numbers--17 and 18 tax liabilities. Can we assume that Intuit is reputable enough that their 18 forecast is accurate based on the reform? According to it, I'm looking at saving about 17K off my tax bill next yea...
by The Wizard
Fri Jan 19, 2018 10:04 am
Forum: Personal Finance (Not Investing)
Topic: Stats on When People Take Social Security
Replies: 173
Views: 11447

Re: Stats on When People Take Social Security

^ As the followup, Wiz, Obviously in a sideways or down Market, spending down your NestEgg may be preferable but of course you are trading off the Sequence of Returns problem for future SS accrued benefits. It is my opinion that Market Timing may be a solution to the this question of when to initia...
by The Wizard
Fri Jan 19, 2018 9:36 am
Forum: Personal Finance (Not Investing)
Topic: Stats on When People Take Social Security
Replies: 173
Views: 11447

Re: Stats on When People Take Social Security

...WHY? Some BH who followed this advice, would have rapidly realized their mistake these past 8 years. In this 9 year Bull Market, the TSM or similar, beats the delay SS accrual. Right. So the plan then should be simply to schedule a nice bull market run for the years from your age 62 to 70. Odd t...
by The Wizard
Fri Jan 19, 2018 9:32 am
Forum: Investing - Theory, News & General
Topic: 10 years expenses in FI
Replies: 49
Views: 4763

Re: 10 years expenses in FI

...As I have mentioned on my post what I would do is if at the end of each year any excess return from your stock allocation is sold to replenish the 10 year cash bucket. If stocks are down for the year then you do nothing. Then next year same thing. It is assuming that stocks over 10 years will ev...
by The Wizard
Fri Jan 19, 2018 7:44 am
Forum: Investing - Theory, News & General
Topic: 10 years expenses in FI
Replies: 49
Views: 4763

Re: 10 years expenses in FI

One thing to think through if you try to follow an "10 years expenses" plan is what happens next year when you are down to 9 years expenses? If you just rebalance to get back to ten years expenses then how is that different than if you just kept something like a 60/40 (or whatever) asset allocation...
by The Wizard
Fri Jan 19, 2018 6:07 am
Forum: Investing - Theory, News & General
Topic: 10 years expenses in FI
Replies: 49
Views: 4763

Re: 10 years expenses in FI

This is called bucket allocation. Possibly. It depends on the mechanics of withdrawing money. Let's say Fred has a portfolio with $400k in total bond market and $600k in total stock market. He intends to withdraw $40,000 per year and has a 60/40 AA. He does not NEED to withdraw solely from his bond...
by The Wizard
Thu Jan 18, 2018 9:15 pm
Forum: Investing - Help with Personal Investments
Topic: Which tax year does a Roth conversion fall under?
Replies: 6
Views: 428

Re: Which tax year does a Roth conversion fall under?

joo2lo wrote:
Thu Jan 18, 2018 8:19 pm
So I am assuming that one would have to calculate the amount of taxable income they are withdrawing from their other retirement accounts towards the end of the year to estimate how much they can convert in order avoid the higher tax brackets?
Basically, yes...
by The Wizard
Thu Jan 18, 2018 5:03 am
Forum: Investing - Theory, News & General
Topic: [n X expenses + r] instead of [n X expenses]
Replies: 27
Views: 1087

Re: [n X expenses + r] instead of [n X expenses]

I prefer to focus on a Desired Retirement Income and leave it at that. My Desired Retirement Income exceeds my Expenses by a fair amount, yes. My actual retirement income does also. Conversely, this approach allows me to grow my expenses in retirement, such as the spur of the moment hiking trip to A...
by The Wizard
Thu Jan 18, 2018 4:31 am
Forum: Investing - Help with Personal Investments
Topic: Backdoor Roth IRA Question
Replies: 11
Views: 1109

Re: Backdoor Roth IRA Question

If you have the funds available, you can contribute $11,000 combined for 2017 + 2018 right now (prior to April 15) on the same day. Then convert the combined total the following day, which might be $11,021 or similar if there was a small uptick in the market on day one. If you open IRA accounts at V...
by The Wizard
Thu Jan 18, 2018 4:18 am
Forum: Personal Finance (Not Investing)
Topic: 1,000th post and a 'No-Fail' Retirement Formula
Replies: 47
Views: 4163

Re: 1,000th post and a 'No-Fail' Retirement Formula

And I still prefer to model retirement cashflow streams with a spreadsheet that shows the variation year to year.
Typical example: retire at 65 but postpone SS until 70. So withdraw more from portfolio first five years, possibly with Roth conversions. Then withdraw less once SS starts...
by The Wizard
Thu Jan 18, 2018 4:13 am
Forum: Personal Finance (Not Investing)
Topic: 1,000th post and a 'No-Fail' Retirement Formula
Replies: 47
Views: 4163

Re: 1,000th post and a 'No-Fail' Retirement Formula

I would delete the Xn term from right side of the equation.
If I have 5 years remaining until retirement, I'll fund those expenses from employment income, not from portfolio...
by The Wizard
Wed Jan 17, 2018 10:58 pm
Forum: Investing - Help with Personal Investments
Topic: What will happen if everyone indexed?
Replies: 23
Views: 2269

Re: What will happen if everyone indexed?

We'll all be rich after a few decades?
by The Wizard
Wed Jan 17, 2018 11:59 am
Forum: Personal Finance (Not Investing)
Topic: Stats on When People Take Social Security
Replies: 173
Views: 11447

Re: Stats on When People Take Social Security

I have no input on how young people should plan on far off SS as that is political speculation . I would observe that all retirement planning is an exercise is successive approximation as time goes on. We agree. It's unfortunate that many base this decision, even those who are 62 and older, on thei...
by The Wizard
Wed Jan 17, 2018 8:37 am
Forum: Personal Finance (Not Investing)
Topic: Stats on When People Take Social Security
Replies: 173
Views: 11447

Re: Stats on When People Take Social Security

While I’ve read the reasoning on here many times, I’ve never believed that delaying was a core Boglehead philosophy. It may make good sense for a lot of people, but I don’t put it the same group as LBYM, stay the course or low cost index funds. When did delaying SS make you a BH? I would say it's a...
by The Wizard
Wed Jan 17, 2018 8:14 am
Forum: Investing - Help with Personal Investments
Topic: Is a Stable Value fund just a Variable Annuity?
Replies: 25
Views: 1580

Re: Is a Stable Value fund just a Variable Annuity?

I should mention, as regards terminology, that while TIAA Traditional is inescapably labelled as an annuity, it really can be thought of and used as a tax deferred savings account. There are no sneaky fees. In retirement, withdrawals can be done in a few different ways, possibly with restrictions. I...
by The Wizard
Wed Jan 17, 2018 7:56 am
Forum: Investing - Help with Personal Investments
Topic: Is a Stable Value fund just a Variable Annuity?
Replies: 25
Views: 1580

Re: Is a Stable Value fund just a Variable Annuity?

I have TIAA Traditional accumulations of both types: restricted paying 4.0% and unrestricted paying 3.25% for new contributions. They don't refer to Trad as a Stable Value fund, but it effectively is. I also have annuitized Trad paying me lifetime monthly income, very similar to an SPIA. But we Trad...
by The Wizard
Tue Jan 16, 2018 8:46 pm
Forum: Personal Finance (Not Investing)
Topic: Stats on When People Take Social Security
Replies: 173
Views: 11447

Re: Stats on When People Take Social Security

Yes I meant the restricted app for spousal benefits which we just applied for a couple months ago.Even though we are taking advantage of it and it will actually help us out some,I am glad they are phasing it out. That's what I'm taking also, but Divorced Spouse. And I'm not glad they are phasing it...
by The Wizard
Tue Jan 16, 2018 7:22 pm
Forum: Investing - Help with Personal Investments
Topic: Quick Roth Conversion Question
Replies: 4
Views: 281

Re: Quick Roth Conversion Question

Those Roth conversions will benefit you financially after age 70.
Fire up a spreadsheet and do them...
by The Wizard
Tue Jan 16, 2018 7:05 pm
Forum: Investing - Theory, News & General
Topic: Is lump sum or dollar cost averaging more in line with boglehead values?
Replies: 22
Views: 1541

Re: Is lump sum or dollar cost averaging more in line with boglehead values?

. . . it seems like one is taking higher risk in this scenario. Of course. Why the bleep :happy are you putting that money in the market if it isn't to take the risk? This illustrates how questions about DCA are really questions about the asset allocation -- how much risk one is deciding to take. A...
by The Wizard
Tue Jan 16, 2018 7:03 pm
Forum: Investing - Theory, News & General
Topic: Is lump sum or dollar cost averaging more in line with boglehead values?
Replies: 22
Views: 1541

Re: Is lump sum or dollar cost averaging more in line with boglehead values?

Lump sum investing is the way to go for irregular lump sums that appear separately from regular employment income...
by The Wizard
Tue Jan 16, 2018 5:44 pm
Forum: Personal Finance (Not Investing)
Topic: Stats on When People Take Social Security
Replies: 173
Views: 11447

Re: Stats on When People Take Social Security

What I do not understand is why they allow file and suspend.They are running out of money but they choose to give free money to probably mostly wealthier people who use it for play money. People such as myself, yes. That's why the law got changed to force deemed filing for everyone after a transiti...
by The Wizard
Tue Jan 16, 2018 9:41 am
Forum: Personal Finance (Not Investing)
Topic: Stats on When People Take Social Security
Replies: 173
Views: 11447

Re: Stats on When People Take Social Security

...There is a reason for taking SS before 70 which is related to “the system will be broke by then”. IMO, people who use this related reason are not rationalizing. Unfortunately, the moderators have decided that this related reason cannot be discussed at Bogleheads. You may have that a bit backward...
by The Wizard
Tue Jan 16, 2018 8:31 am
Forum: Personal Finance (Not Investing)
Topic: 2018 Withholding Tables
Replies: 88
Views: 11109

Re: IRS announces new withholding tables for 2018

All my income is from 1099-R and SSA- nowadays. Withholding allowances aren't applicable for me. So my plan is to redo my 2017 income tax computations using the new 2018 tax rules in a few weeks. I'll then have a personal dollar amount difference between the old tax law and the new one. From this, I...
by The Wizard
Mon Jan 15, 2018 3:16 pm
Forum: Personal Finance (Not Investing)
Topic: Our 'cure' for emergency expenses
Replies: 65
Views: 7356

Re: Our 'cure' for emergency expenses

Our "freedom fund" has always been part of our checking account. Why make it complicated? We never ended up with a year's worth of once-yearly expenses all in the checking account at once because they are all due in different months, give or take. Same here basically, as I think I mentioned upthrea...
by The Wizard
Mon Jan 15, 2018 2:41 am
Forum: Investing - Help with Personal Investments
Topic: how to figure out the assest allocation that you can sleep well with
Replies: 22
Views: 1893

Re: how to figure out the assest allocation that you can sleep well with

I don't see the OP's age and employment/retirement status. If you are more than a decade from retirement, 70% stocks is fine. Your portfolio's total value is EXPECTED to decline when the next stock market correction happens. Try to be accepting of that. If you want to reduce risk a bit, then go down...
by The Wizard
Sun Jan 14, 2018 10:10 am
Forum: Personal Consumer Issues
Topic: Looking for a reasonably priced, safe international destination
Replies: 107
Views: 6412

Re: Looking for a reasonably priced, safe international destination

Depends on whether you want a European or Caribbean flavored experience.
Ireland or The Netherlands are good for the former.
And most Caribbean islands are good, even if English isn't their first language...
by The Wizard
Sun Jan 14, 2018 10:05 am
Forum: Investing - Help with Personal Investments
Topic: Asset Allocation Revised
Replies: 15
Views: 1004

Re: Asset Allocation Revised

Two question areas I have: First, what has your allocation to stocks been over the past few decades? I worry that if 35% is higher than you are comfortable with, that you will make the wrong move when the next Stock Market Crash happens. Second, where is your retirement income coming from and how de...
by The Wizard
Sat Jan 13, 2018 3:58 pm
Forum: Personal Finance (Not Investing)
Topic: Roth convert to just below IRMAA threshold?
Replies: 13
Views: 890

Re: Roth convert to just below IRMAA threshold?

I'm in a higher IRMAA tier and always will be with the present system. But I agree that one should keep an eye on projected MAGI each year to avoid being Just Above the next tier threshold due to Roth conversions a bit too big. Due to $30,000 of part-time income in 2016, I'm in an even higher IRMAA ...