Bogleheads.org

benjaminikuta wrote: ↑Wed Mar 29, 2023 12:35 pm

the_wiki wrote: ↑Tue Mar 28, 2023 10:35 pm Well Fargo Autograph has 3% Travel, Dining and Gas and no foreign transaction fees. So even if you don't use it for everything, it covers all the things you spend money on when you travel.

Capital One Quicksilver has no foreign fees and only pays 1.5%, but with the $200 sign up bonus, it will be ahead of a 2% card until you have spent $40,000 total on the card. (And by then you can get a different card)

I actually don't travel that much, I'm just living in a foreign country.

Do you have a USA address/citizenship/credit score? If not, you likely aren't eligible for any of these cards.

Zions Bank is the biggest regional Utah bank. Been around in some form since 1873 and they have many physical branches here in Salt Lake City. I wouldn't hesitate to buy a CD from them, but as others have said I'd probably cap it at FDIC limits for ANY bank right now.

Schwab has chat support. I bet they could answer this in 5 mins for you.

Is there a way to mitigate this tax burden, or do I understand correctly that I will have to pay 15% on 23,000? My account now offers TLH. But will that be useless since the funds I now own will be less than a year old by the end of the year? It will likely incur additional state tax income as well, so keep that in mind. The easiest way to pay it without blowing up your budget is to just sell shares from your taxable account at Vanguard to pay the tax when you figure out exactly what is due. That money caused the tax, so you can pay it using that money. You will have a few thousand less to compound going forward, but if you paid it out of pocket you would have that much less to invest this year, so its all a wash either way. The tax is due...

Well Fargo Autograph has 3% Travel, Dining and Gas and no foreign transaction fees. So even if you don't use it for everything, it covers all the things you spend money on when you travel.

Capital One Quicksilver has no foreign fees and only pays 1.5%, but with the $200 sign up bonus, it will be ahead of a 2% card until you have spent $40,000 total on the card. (And by then you can get a different card)

Peacock has NBC news live channels
Paramount+ has live CBS news channels.

Both are $5-10 a month.

Hulu has ABC news live channel but costs a little bit more. (10-15$)

Tubi is free and has multiple news channels, but I don’t know if it same content as paid services. Worth a look.

Does your broker offer automatic RMD withdrawals to prevent this in the future? Most of them should.

Many people have a limited understanding of options. Selling covered calls is one of the safest and most predictable things. You will always make money in the transaction if the strike price is above your cost basis. The risk is, you could have made more or after the transaction or you might be will be at a place do not want to be. Selling the call, you get a premium. That's your's to keep no matter what happens next. And there are only two outcomes: 1. The price exceeds your strike price -- you sell the shares at the strike price and keep the premium. or 2. The price is below your strike price -- keep your shares and keep the premium. In either case, you keep the premium. If the stock shoots up 20% above the strike price, you may feel lik...

Is your wife's IRA a Roth or Traditional? With your income, you are likely not getting any deductions for a Traditional IRA.

Doesn't her teaching job offer something like a 403b or 457b?

You should both be eligible for Roth.

But if I’m otherwise going to sell today, I’ve already forfeited potential increases, no? How does it going up ever hurt me? Also whats the difference between having already owned the stock or buying it today? For the volatility portion, maybe I’m not understanding it correctly. In selling my covered call option at 215, the buyer has to execute at 215 or higher. How does that impact me during volatility? If the person executes it at 215, how do I go wrong? Are you saying it gets executed at 215 and then somehow goes to 190 before I close the position? What if the market drops 10% (back to last October's bottom) while you are playing around trying to make free money? now you lost the $35,000 you needed to buy the car and you only made a cou...

This sounds like someone trying to get greedy instead of just paying for something they need with money they have.

If you really have no idea where to even begin, I agree a Target Date fund is a good idea.

Good advice above.

And consider that even if you did want to hand it over to an advisor, you are already at Vanguard. They only charge .30% and you likely would not have to cash out any holdings and pay tax.

1% rollover match is not bad. Robinhood is a bit aggressive pushing things like options trading and the like, but if you just want to buy some index ETFs and hold, it's no worse than anywhere else.

I agree the marketing is confusing, though.

I honestly feel like any investing books are going to be boring and not very useful. I'd keep it simple. Teach them about basic concepts like compounding vs time, value of consistent contributions and starting early, etc. And then just some basic advice on why basic, boring low cost funds are better than trying to chase winning stocks. For every Apple, there are a dozen Packard Bell and Gateway.

Some good lessons in this article from Bogle you could use as a starting point (link at bottom of page to PDF): https://www.bogleheads.org/wiki/The_twe ... _of_wisdom

Edit: Correction, the 1% match is in fact eligible for rollovers for a few weeks.

For a sale this large, it may be worth paying a professional accountant for tax optimization advice. You are talking six figures of taxes even in the best case scenario. The right advice taking into account all your income and assets may save you tens of thousands of dollars or more.

You could just see if they would move it to the Automated Robo Advisor at Wells Fargo. They are 0.35% fee (.25% if you have certain checking accounts) and they use low cost index funds, so the fee should be .4-.5% tops rather than 1.5-2% with the human advisor, which will save a bundle.

https://www.wellsfargoadvisors.com/serv ... vestor.htm

Moving them to self managed sounds good on paper, but then you are going to be blamed if the returns are poor, and you are setting them (or you) up for more work or stress managing it.

It's a part time job. But pays well. All that matters if your wife needs to step in is what you have currently and where it is. I guess the question is: do you need/want a part time job? I would say that I don't and I have not really chased brokerage bonuses, I just took a small detour on the consolidation route. However, I have chased credit card sign-up bonuses for years and I am not sure if I'll stop. Remaining to be determined is whether or not I'll ever bother to stash $100K at B of A for higher ongoing rebates. We don't spend a lot, so that's only worth about $200 extra per year vs. using 3 Citi cards for most things (custom cash, double cash, and the Costco card). If you have a three or more million to move around, the payoff per mi...

I had to do this recently with a 4-5 day window out of the market, and I just did 25% per week for 4 weeks to hedge my bets. I think I ended up about .5% ahead. But if I would have picked the wrong window in that month with 100% out I would have lost close to $10k. And if you had picked the right window, would you have gained more than $10K? Yes, but by being 75% in the market at all times by splitting it up across 4 weeks, I would still have gained $7500 instead of zero. And if the market drops I will capture 75% of those losses, but not all of them. I will get 75% of the 4 week gains and losses guaranteed. Since gains and losses do not come evenly, it is impossible to predict what percentage of a month's gains and losses I would get by b...

Long time follower, posting for 1st time. During the last few years, I tried my hand at diversifying the portfolio and now have unwieldy portfolio. One of the goals for 2023 is to simplify and eventually towards an 80/20 VTI-BND portfolio. However I do not want to do all of them overnight in one go and structurally move them in a meaningful way. Which of these would you recommend targeting to sell for 2023. Symbol - Description - Quantity BND - Vanguard Total Bond Market ETF - 104.237 BNDX - Vanguard Total International Bond ETF - 68.084 IVOO - Vanguard S&P Mid-Cap 400 ETF - 205.282 MGK - Vanguard Mega Cap Growth ETF - 495.023 VBK - Vanguard Small-Cap Growth ETF - 72.661 VEA - Vanguard FTSE Developed Markets ETF - 209.047 VIOO - Vangua...

investor9999 wrote: ↑Fri Mar 24, 2023 5:14 pm
@mkc - this is for a Roth IRA, not a taxable account - I should have said that.

Yeah, I'd just get FSKAX - Fidelity Total Market index to keep it simple.

You can see from this comparison they are virtually identical and have returns so identical it looks like there is only one stock on the graph.

https://www.portfoliovisualizer.com/fun ... bols=VTSAX

exodusNH wrote: ↑Fri Mar 24, 2023 11:55 am

the_wiki wrote: ↑Fri Mar 24, 2023 11:47 am Paying a double first payment seems like an odd strategy because it implies you could have just made a larger down payment.

This is sometimes a requirement to get on the biweekly payment schedule.

Correct me if I am wrong, but I thought the first "double" payment is generally just a regular monthly full payment as scheduled. It's only double relative to the 1/2 payments you will be making biweekly going forward.

Paying a double first payment seems like an odd strategy because it implies you could have just made a larger down payment.

Paying half your payment every two weeks is a trick to get get an extra payment made over each year. You could also just pay 1/12 extra each month and end up at the same total payment.

With current rates, paying off your mortgage early is likely to be higher after-tax returns than investing, so any tricks that get you there are probably not bad advice.

Hello. I work for a big corp and have a traditional 401k through Fidelity but the funds I was invested in was changed on 8/8/22. Old investment: Fidelity® 500 Index Fund Ticker: FXAIX Gross Expense Ratio: 0.0150% (85% allocation). Old investment: Vanguard Small-Cap Index Fund Institutional Plus Shares Ticker: VSCPX Gross Expense Ratio: 0.03% (15% allocation). New investment: Spartan® 500 Index Pool Class F Ticker: N/A Gross Expense Information: 0.0075% (85% allocation). New investment: Small Cap Index Fund Ticker: N/A Gross Expense Information: 0.028% (15% allocation). It picked the closest fund to put in from old to new and does have a lower ER. Should I stick to these funds and allocation? I chose the old 2 funds and allocations based on...

I had to do this recently with a 4-5 day window out of the market, and I just did 25% per week for 4 weeks to hedge my bets. I think I ended up about .5% ahead. But if I would have picked the wrong window in that month with 100% out I would have lost close to $10k.

This question I suppose concerns a corollary of dollar cost averaging. I've seen the posts that lump sum investing seems to perform better than dollar cost averaging. But how about when it comes time to make withdrawals during retirement? Is it better to take a lump sum once per year or take withdrawals on a monthly or even bi-weekly basis? The reason why lump sum is statistically superior to DCA is normally attributed to "time in the market". That means that waiting a long as possible to withdrawal should also be superior to large withdrawals at the start of the year. In other words, DCA out is superior to lump sum out! "time in the market" is a positive factor when talking about long term investing, but it is generall...

Fund a mortgage for someone?

Multi-Year Guaranteed Annuities are still paying about 5.5% for 5-10 year terms. They are guaranteed income through insurance companies. Might be something to consider.

cat5 wrote: ↑Thu Mar 23, 2023 10:00 am Did I make a mistake by having VTSAX AND VTI in the same taxable account?

VTSAX = approximately 60% of portfolio
VTI = " 20%

I do not contribute to VTI anymore, but make regular contributions to VTSAX.

Thanks you,
cat5

They are literally two forms of the exact same fund, so really you just have 80% of your portfolio in VTSAX. Think of them as one asset with different tax lots.

Nothing particularly wrong with that, just make sure you actually wanted 80% in total stock market fund in this account

Interesting, thanks for the reply.

I still maintain S&P was created as a total market fund and continues to be one today. You don't always have to hold all possible stocks in a particular universe to get the returns of that specific factor.

I may have been mistaken on how they arrived at 500 stocks, but I don't think it invalidates my claim.

Wealthfront offers $2 million FDIC ($4mil joint) for their cash/savings by spreading your money across 8 banks. They just bumped their rate up to 4.3%.

https://support.wealthfront.com/hc/en-u ... h-Accounts

nisiprius wrote: ↑Wed Mar 22, 2023 5:23 pm

the_wiki wrote: ↑Wed Mar 22, 2023 5:13 pm The S&P 500 is a "Total Stock Market" fund.

It was designed specifically to represent the returns of the entire U.S. stock market. They determined 500 was enough stocks to capture the entire markets returns. And looking at the historical returns of S&P500 vs newer indexes holding 2-10x as many stocks, they were not wrong.

They didn't "determine that 500 stocks was enough," it was just the most they could do with the computers they had in 1957.

Do you have a source for that claim? I cannot find any reference to that with web searches.

Sometimes people are scared for a reason. Just because others are fearful of a failing bank doesn't make it a good investment. You still have to do your homework, and Buffet has a team of Ivy League grads to do that for him.

Thinking about this a little more, I'm feeling like a pull makes more sense from a security perspective. Then everything is only linked to the main credit union and nothing else. And anyone that gets into the credit union has access to nothing else.

Obviously exceptions require exceptions, but as a rule that sounds to be a safer strategy than having CU able to clean out all the other accounts from one place.

The S&P 500 is a "Total Stock Market" fund.

It was designed specifically to represent the returns of the entire U.S. stock market. They determined 500 was enough stocks to capture the entire markets returns. And looking at the historical returns of S&P500 vs newer indexes holding 2-10x as many stocks, they were not wrong.

whodidntante wrote: ↑Wed Mar 22, 2023 12:51 am The mega caps tend to trip themselves over their extremely large feet. So I think just avoiding those would improve a portfolio. However, owning mid caps with a quality filter would do that just fine, since an S&P 500 fund minus clown shoe companies seems elusive. There seems to be a bit of a small cap boost as well, also with a quality filter. Extended market funds and the Russell 2000 seem to be an eternal dumpster fire.

Vanguard's Mid Cap (VO) is pretty close as it is a "large" mid-cap that holds about 270 of the S&P500 stocks.

retired@50 wrote: ↑Wed Mar 22, 2023 9:25 am

sheople2 wrote: ↑Wed Mar 22, 2023 9:08 am What is the name of the older Vanguard chart...

It's like a YTD history showing several decades via pie charts of stocks/bonds and their respective estimated YTD.
Vanguard on the phone couldn't help me without the name, which I would just then put into their search.

The site has totally changed, so the tools I was familiar with are not appearing - at least not without the right title.
Thank you.

Is this what you mean?

See link for historical performance averages of a variety of portfolio mixtures.
https://investor.vanguard.com/investor- ... allocation

Regards,

They need to update it with 2022 results. I think it might really change the results for the majority bond portfolios.

I might look at iShares Core Allocation ETF funds:

https://www.ishares.com/us/literature/p ... -brief.pdf

BogleFan510 wrote: ↑Tue Mar 21, 2023 11:11 am

bshnew wrote: ↑Tue Mar 21, 2023 10:47 am Would adding SCHB, Schwab's total US market ETF, unnecessarily complicate my portfolio?

Dont think so. It might change expected returns and volatility, as a bond fund. I also hold SCHB. It is a solid bond ETF, though perhaps vanguard bond fund is a slightly better long term performer, with some small tax advantages.

SCHB is a total market fund like VTI - all stock, no bonds.

bshnew wrote: ↑Tue Mar 21, 2023 10:47 am Would adding SCHB, Schwab's total US market ETF, unnecessarily complicate my portfolio?

SCHB is "total market", so in additional to holding all the large companies like SCHX it has about 15% in smaller and mid size companies. But that means about 85% of it is still identical to SCHX and SWPPX. So I wouldn't say it's really a productive addition. The returns end up being very similar to SCHX.

If you want to get closer to a total market, you'd probably be better off just adding a small cap fund rather than adding SCHB. For small cap from schwab you could do SWSSX for a mutual fund or SCHA for an ETF. Building that up to about an 85/15 ratio with your SWPPX and SCHX would be about the same as converting everything to SCHB.

My apologies for not including the full fund names. Here they are: SCHX = Schwab US Large-Cap ETF, expense ratio 0.03% SWPPX - Schwab S&P 500 index fund, expense ratio 0.02% Brooke Both are Large cap US stock funds holding mainly the same exact stocks and can be considered identical with regards to expected returns. The fees are close enough to not matter. So the only deciding factor is mutual fund vs ETF Dollar cost averaging is easier with mutual funds because you invest with dollars not shares. So you can invest exactly the amount you want and not some multiple of share price. That would make the mutual fund more convenient. Taxes are a little friendlier with ETF because they usually have less dividends and capital gains. So you may...

There is really no good cash sweep option at Etrade so it's going to be manual movement. They only pay 0.15% on uninvested cash.

Money market funds can earn a bit more but they trade like Mutual funds and it will take overnight to get back to cash out and available for trading. So if you were leaving it waiting for a market drop or something to re-enter, you could miss your desired window waiting until next day.

Here's a few of the better ones I found with a quick screen:

VMRXX 4.55%
FUGXX 4.51%
GABXX 4.6%

If you want it available for instant access you can open a Savings account at Etrade and that transfers instantly to/from investing accounts and earns 3.5%.

I am tempted to try this at Wealthfront, but the biggest thing holding me back is: A) I have a lump sum to invest and probably won't be contributing a lot to taxable in the future. Will there be anything to TLH after a few years? I guess there are always a few companies with losses if you own the whole index, and dividend reinvestments will create small lots. So maybe there will be some. But it feels like the greatest benefit is going to be to people regularly contributing. B) I feel like I would be stuck forever because who wants to ACATS back a few hundred individual holdings and then manage them? And they would all be low basis because of all the TLH so you'd have a tax hit to unload any of them. C) Taxes. Some are saying you just have t...

Honestly worrying about YTD returns in mid March is very short sighted. I have never seen this type of variance in the Mid-Cap fund from the other broader market indexes. You have just not been paying attention. Look at some historical returns, it a rare year where Large/Mid/Small returns the same. And if you were expecting the same returns as VTI, just buy VTI! https://www.portfoliovisualizer.com/backtest-asset-class-allocation?s=y&mode=1&timePeriod=4&startYear=1972&firstMonth=1&endYear=2023&lastMonth=12&calendarAligned=true&includeYTD=false&initialAmount=10000&annualOperation=0&annualAdjustment=0&inflationAdjusted=true&annualPercentage=0.0&frequency=4&rebalanceType=1&absolute...

anil686 wrote: ↑Thu Mar 16, 2023 9:54 pm
This x 1000 IMO…. It was the same (separate from Direct Indexing) with Wealthfront and others before with the continuous TLH portfolios. Those were a mess after a year….

I'd have a hard time calling any of them "a mess" when you just get the ETF portfolios. They are still a good portfolio of low cost index funds. Worst case you get like a 10 fund portfolio with most of the funds from Vanguard or iShares. I'm surprised you mentioned Wealthfront as their default portfolio is just VTI, VWO, VEA, BND and VIG.

I think the biggest reason that some advisors/brokers are pushing direct indexing is because you are effectively trapped once you get a few years into it with some solid gains. You'll have a few hundred individual holdings. Sure you can ACATS out at any time, but trying to unwind all those positions without blowing up your taxes and maintaining your asset allocation is going to be a bigger challenge than most would be willing to take on.

Typical Bond funds have a maturity date that is always in the future. Individual bonds have a specific maturity date. If you need money in exactly 2 years, you would want something with a specific maturity date. Say you find a Bond fund with an average maturity date of 2 years, like iShares SHY. In 23 months from now, the average maturity date will still be 2 years away so the risk stays the same. And in the wrong market, that can make a huge difference. SHY dropped from 86 to 80 in a matter of 2 months last fall. If someone invested in 2021, they probably won't be getting all their money back by that 2 year mark. Individual bonds get less risky as they go on and you know exactly what you are getting back at the end. So if you have a specif...

This is the main reason I would almost always prefer brokered CDs.

My paycheck goes into my credit union and then I want a portion of it to go to various other investment and savings accounts. Are there any pros/cons to initiating those transfers from the credit union side vs the online savings or broker accounts? As in pushing the money from my checking vs having it pulled?

Interested to hear any thoughts on the subject, thanks.