Search found 3984 matches

by Chip
Tue Nov 15, 2022 7:33 am
Forum: Investing - Theory, News & General
Topic: How does Schwab calculate its tax cost ratios for funds?
Replies: 9
Views: 1041

Re: How does Schwab calculate its tax cost ratios for funds?

I would note that the Schwab tax cost ratio numbers for VTI and VTSAX show the same tax cost ratio anomaly that Morningstar does. Even though VTI and VTSAX are share classes of the same fund, significantly different 3 year tax cost ratios are shown (.58 vs. .38). I don't know the source of this anomaly but it makes me less confident in Morningstar's/Schwab's numbers. Morningstar does not always know about qualified dividends, which is probably the issue here. Vanguard gives a 0.37% three-year tax cost for VTI through 9/30/22 (returns of 7.61% pre-tax, 7.21% after tax, give a tax cost of (1.0761-1.0721)-1=0.0037). How on earth can they NOT know? Any one of us can look it up in a few seconds. It's hard to believe it's not part of their data ...
by Chip
Tue Nov 15, 2022 7:26 am
Forum: Investing - Theory, News & General
Topic: How does Schwab calculate its tax cost ratios for funds?
Replies: 9
Views: 1041

Re: How does Schwab calculate its tax cost ratios for funds?

One thing I noticed is that VTI Tax Comparison has a date of 10/31/2022 whereas on the VTSAX page there are two different sections: Monthly Pre-Tax Returns (as of 10/31/2022) and Quarterly Tax Performance (as of 09/30/2022). Thanks for that deep dive. It's disappointing that Morningstar (assuming the linked Schwab numbers are from M*) reporting dates are different for open end funds vs. ETFs. I don't see any reason for it. What also stands out is the raw/pre performance numbers. VTI 3 & 5 year performance are 9.0% and 9.1% but for VTSAX it's 9.67% and 9.79%. Both of those are supposedly using data as of 10/31/2022. If the raw numbers aren't close then downstream calculations like tax efficiency will be wrong, too. I could be wrong, but...
by Chip
Tue Nov 15, 2022 3:26 am
Forum: Personal Investments
Topic: Help see if I’m understanding Tax-Loss Harvesting
Replies: 14
Views: 1886

Re: Help see if I’m understanding Tax-Loss Harvesting

All your scenarios are correct from a math standpoint.

Often "covered" sales can be reported directly on Schedule D, bypassing Form 8949.

Note that carryover losses are tracked on Schedule D worksheet that's not filed with your tax return. Tax software handles this, but someone who files on paper or switches software needs to make sure the carryover makes it to the next tax year.

Also note that most here loss harvest by immediately buying a similar (but not substantially identical) investment to replace what was sold. This is in order to maintain the same asset allocation.
by Chip
Tue Nov 15, 2022 3:04 am
Forum: Personal Investments
Topic: Accrued dividends in NAV for sell during month
Replies: 80
Views: 6929

Re: Accrued dividends in NAV for sell during month

I'm still not getting it. If I receive the NAV, and that NAV contains the accrued interest, why should I get an "extra" payment of interest along with the NAV? The NAV of a fund that declares dividends daily does not contain accrued interest. The dividends declared since the previous dividend distribution may be considered to be an asset of the fund but it also a liability to be paid as part of the next dividend distribution. The NAV of the fund is calculated from the assets minus the liabilities. Thanks. This makes sense to me. I guess my description of a "side fund" of accrued interest that's not in the NAV wasn't technically accurate but is a reasonable proxy for what actually happens from a fund shareholder POV.
by Chip
Mon Nov 14, 2022 7:31 am
Forum: Investing - Theory, News & General
Topic: How does Schwab calculate its tax cost ratios for funds?
Replies: 9
Views: 1041

Re: How does Schwab calculate its tax cost ratios for funds?

Emphasis mine. Seems like FTC would be taken into account? Anyways, the rule mentions that a fund has to report the after-tax return information annually via an update to the fund's Form N-1A. So I imagine Morningstar or whoever displays the before and after tax performance info is getting that info from the N-1A, which can be retrieved from the SEC EDGAR system. Thanks! You read that much more carefully than I did. I missed the FTC discussion. Interestingly, the footnote (#79) to that section says the following: In computing after-tax returns, a fund that elects to pass foreign tax credits through to shareholders may assume that the shareholders use those credits. We would not object if a fund adjusts after-tax returns to reflect the impa...
by Chip
Mon Nov 14, 2022 7:16 am
Forum: Personal Investments
Topic: Accrued dividends in NAV for sell during month
Replies: 80
Views: 6929

Re: Accrued dividends in NAV for sell during month

alex_686 wrote: Mon Nov 14, 2022 7:05 am The fund is paying out the dividends early, on the date of sale rather on the ex-div date at the end of the month.
I'm still not getting it. If I receive the NAV, and that NAV contains the accrued interest, why should I get an "extra" payment of interest along with the NAV?
by Chip
Mon Nov 14, 2022 6:41 am
Forum: Personal Investments
Topic: Accrued dividends in NAV for sell during month
Replies: 80
Views: 6929

Re: Accrued dividends in NAV for sell during month

alex_686 wrote: Mon Nov 14, 2022 6:23 am It is in the fund.

All funds work on accrual accounting. So everyday coupon income is accredited to a income ledger. This is treated as a asset when calculating NAV.
Makes sense. I stand corrected.

But I would note that when I sold a Vanguard muni fund I received the NAV plus an interest payment. How does that happen if the interest accrual is in the NAV?
by Chip
Mon Nov 14, 2022 6:40 am
Forum: Personal Finance (Not Investing)
Topic: 5 year rule with spousal transfer of Roth IRA
Replies: 18
Views: 1631

Re: 5 year rule with spousal transfer of Roth IRA

Silk McCue wrote: Mon Nov 14, 2022 6:29 am No. The problem is with the interpretation/application of the referenced code to this posters situation. The Wiki has been full vetted and exists for the very purpose of dealing with this complex topic.
Okay. Please explain how the code is being misinterpreted. The wiki is silent on that point.

I would further note that the primary reference in the wiki for the point being discussed is a wiki background discussion amongst bogleheads.
by Chip
Mon Nov 14, 2022 6:25 am
Forum: Personal Finance (Not Investing)
Topic: 5 year rule with spousal transfer of Roth IRA
Replies: 18
Views: 1631

Re: 5 year rule with spousal transfer of Roth IRA

Silk McCue wrote: Mon Nov 14, 2022 6:17 am You are mistaken. This 72 year old widow does not need to wait to access any and all of these funds.

Please read the Wiki on this topic.
Are you suggesting that the Bogleheads wiki is a more authoritative source than the Code of Federal Regulations quoted by FactualFran?
by Chip
Mon Nov 14, 2022 4:20 am
Forum: Personal Investments
Topic: Accrued dividends in NAV for sell during month
Replies: 80
Views: 6929

Re: Accrued dividends in NAV for sell during month

Carsson3 wrote: Sun Nov 13, 2022 8:55 pm For daily accrual bond mutual fund sales between ex-dividend dates, for example the 15th of a given month, the dividend for these funds is also said to be 'in the NAV". Does this mean that for each market day, each fund's NAV at the market close is lowered overnight by the total amount of all dividends paid out in the fund during that day, so that the opening NAV on the next market day is reduced systematically in that way, and the same for every other market day?
I don't think "it's in the NAV". I believe there's a "side fund" of accruals that you can't see until the dividend is paid, either on the normal date or when you sell the fund.
by Chip
Mon Nov 14, 2022 4:05 am
Forum: Investing - Theory, News & General
Topic: How does Schwab calculate its tax cost ratios for funds?
Replies: 9
Views: 1041

Re: How does Schwab calculate its tax cost ratios for funds?

Hi, and welcome! Your link looks like something from Morningstar that's been repackaged by Schwab. I believe that most (if not all) of these calculations are following SEC rules on how to perform them. The rule is here . I would note that the Schwab tax cost ratio numbers for VTI and VTSAX show the same tax cost ratio anomaly that Morningstar does. Even though VTI and VTSAX are share classes of the same fund, significantly different 3 year tax cost ratios are shown (.58 vs. .38). I don't know the source of this anomaly but it makes me less confident in Morningstar's/Schwab's numbers. Here are a few questions I have. My interpretation of the SEC rules: 1) Does it assume the highest tax bracket? Yes 2) Does it include the 3.8% Net Investment ...
by Chip
Sat Nov 12, 2022 11:26 am
Forum: Personal Consumer Issues
Topic: New Zealand travel - South Island
Replies: 42
Views: 3753

Re: New Zealand travel - South Island

Sand Flies Again, not sure how others haven't mentioned this. Sand flies are miserable on the South Island, particularly in Fiordland. (The Maori joke/legend was that the god of the underworld created sand flies to make humans okay with leaving the otherwise paradise that was the island.) Bring long pants and long-sleeve shirts, and use insect repellent. If you're on a boat in the middle of a sound (like Milford or Doubtful), then it's glorious because there are no sand flies. When we hiked the Milford Track in February several years ago our only encounter with sandflies was the last few miles of the last day, as we approached the aptly named Sandfly Point. I wore short sleeved shirts during the entire hike. Maybe we were lucky because the...
by Chip
Sat Nov 12, 2022 10:41 am
Forum: Personal Investments
Topic: Proceeds from 2013 investment
Replies: 8
Views: 710

Re: Proceeds from 2013 investment

lakpr wrote: Sat Nov 12, 2022 10:32 am
Bbddl wrote: Sat Nov 12, 2022 10:22 am Our AGI will be approx 275k, married/ joint filing.
That means your capital gains tax rate would be 15% + 3.8% Net Investment Income Tax = 18.8%. Your AGI exceeds the $250k threshold (which is not indexed to inflation) for NIIT to be applicable.
I'm pretty sure that only the amount of investment income that pushes the AGI over 250k is subject to NIIT. So in this case only 25k would be subject to 18.8%, the remainder at 15%.
by Chip
Thu Nov 10, 2022 4:14 am
Forum: Personal Investments
Topic: Roth Conversion no brainer versus doing nothing
Replies: 32
Views: 4024

Re: Roth Conversion no brainer versus doing nothing

Dodgerdiehard wrote: Wed Nov 09, 2022 9:09 pm Just for clarification, we are in our early 60s and receiving pension income that puts us squarely in the 24% bracket. We'd like to take full advantage of that bracket while we can.
Sounds reasonable, especially with the sunset of TCJA in 2025. Have you modeled IRMAA implications?
If we plan to use the withdrawals to pay the taxes, and not money in after tax accounts [...]
I don't know why you would do this if you have funds available in taxable. Paying the tax from taxable funds effectively allows you to move taxable funds into your Roth.
by Chip
Wed Nov 09, 2022 6:16 am
Forum: Investing - Theory, News & General
Topic: Should I maintain my AA until I feel like capitulating?
Replies: 88
Views: 9257

Re: Should I maintain my AA until I feel like capitulating?

DoTheMath wrote: Tue Nov 08, 2022 6:42 pm How you feel about the market is a deeply personal thing which you can only partially control. But I think the typical reader of BH is more able to learn to control how they respond compared to most people.
So true. While some may benefit from not looking at their balances frequently, for me what has done the trick is to immerse myself in the volatility and become hardened to it.
by Chip
Wed Nov 09, 2022 6:10 am
Forum: Personal Investments
Topic: Roth Conversion no brainer versus doing nothing
Replies: 32
Views: 4024

Re: Roth Conversion no brainer versus doing nothing

How many years are you from drawing those pensions and social security?
by Chip
Wed Nov 09, 2022 5:15 am
Forum: Personal Investments
Topic: Fidelity tax managed funds?
Replies: 9
Views: 1809

Re: Fidelity tax managed funds?

The rep did a comparison using a tax drag analyzing tool and said the Fidelity tax managed fund has a tax drag of -2.5% while one of my main Vanguard funds has a tax drag of 0.3%. The rep said the Fidelity fund does a good job of matching the performance of index funds while having the added benefit of a 2.4% delta (difference between 2 tax drags less the Fidelity fund expense ratio of 0.4%) from a lower tax drag. The assumptions and the arithmetic look a little suspect to me. I suppose if you have funds that aren't efficient in your taxable account then you could get a big improvement. But if you do what you can to follow the wiki's recommendations you'll almost certainly have a lower total cost (fund expenses + taxes). The Vanguard Total...
by Chip
Mon Nov 07, 2022 6:09 am
Forum: Personal Investments
Topic: Opening a ROTH IRA to start the 5 year clock....contributions via conversion?
Replies: 22
Views: 1458

Re: Opening a ROTH IRA to start the 5 year clock....contributions via conversion?

aklanche wrote: Mon Nov 07, 2022 5:48 am Oh dang I thought pro-rata rule was an issue when doing a back door Roth conversion due to rolling post tax dollars through an traditional IRA and converting the post tax dollars to a Roth if you have pre-tax dollars existing in and IRAs.

This would be converting pre-tax dollars from a traditional IRA and converting to a Roth IRA and pay taxes on this conversions. I wasn’t aware this would be subject to pro-rata as I have no intention of converting any post tax dollars.
You needn't worry about this. If you have no post-tax money in your tIRA all of the conversion is taxed. There is no minimum conversion amount unless your brokerage has account minimums. You could conceivably convert just $1.
by Chip
Sun Nov 06, 2022 1:50 pm
Forum: Personal Consumer Issues
Topic: Streaming Challenges: Where's CBS?
Replies: 25
Views: 2080

Re: Streaming Challenges: Where's CBS?

Stinky wrote: Sun Nov 06, 2022 10:51 am However, the ball didn't quite bounce Tennessee's way yesterday. Nor did it bounce Alabama's way.

As you said, "Oh, well, we can't always get what we want". :twisted:
Some of us did. :P
by Chip
Sun Nov 06, 2022 5:47 am
Forum: Investing - Theory, News & General
Topic: Any argument against Roth conversion if your top tax bracket will likely stay the same or increase?
Replies: 196
Views: 14740

Re: Any argument against Roth conversion if your top tax bracket will likely stay the same or increase?

Lee_WSP wrote: Sat Nov 05, 2022 9:35 pm The problem is your trying to draw a universal rule about conversion worth out of whether Roth is preferable for estate planning. That Roth is preferable is more or less just a statement of fact. The weight of which you assign to your estate planning goals is what will tip the scales of the conversion decision.
Really?

I suspect that the charities that will ultimately receive our tIRAs will be much happier to receive 100% of those balances than ~70% of the balances, which is what they would receive if converted to Roth.

Or is figuring out how to maximize the benefit for our beneficiaries not estate planning?
by Chip
Sat Nov 05, 2022 4:55 am
Forum: Investing - Theory, News & General
Topic: Any argument against Roth conversion if your top tax bracket will likely stay the same or increase?
Replies: 196
Views: 14740

Re: Any argument against Roth conversion if your top tax bracket will likely stay the same or increase?

Interesting thread with multiple viewpoints. Two things to consider: 1. Some people have mentioned that long-term care/skilled nursing facility expenses are all deductible but remember, they are not. The standard deduction for a married couple in 2022 is $25,900 so that's the minimum just to itemize. Then, if you're able to itemize, you can only itemize the medical expenses in excess of 7.5% of your AGI. So if you're anticipating taking large withdrawals from your IRA to meet medical expenses, you can anticipate that 7.5% medical expense base to steadily increase. Certainly a very valid concern in many situations. In others, not so much. Picture the sole surviving spouse in a SNF facility where their only income needs are the monthly price...
by Chip
Fri Nov 04, 2022 3:21 pm
Forum: Investing - Theory, News & General
Topic: Any argument against Roth conversion if your top tax bracket will likely stay the same or increase?
Replies: 196
Views: 14740

Re: Any argument against Roth conversion if your top tax bracket will likely stay the same or increase?

The point was trying to make is someone worried about having to cover LTC costs (surprised they are fully deductible because I would think there would be a large room and board component especially in assisted living) isn't or probably shouldn't be ing QCDs so there is no need to worry about both. +1 to FreddieFIRE's comments. It's not being worried about the costs, it's the effect on the marginal tax rate in retirement. You know, that thing that was forecast to be X when justifying Roth conversions. If it turns out to be less than X the conversion will be less of a benefit, or even a cost. I could easily see someone giving away money via QCDs for several years after age 70.5, then stopping them if skilled nursing care became necessary. Or...
by Chip
Fri Nov 04, 2022 4:43 am
Forum: Investing - Theory, News & General
Topic: Any argument against Roth conversion if your top tax bracket will likely stay the same or increase?
Replies: 196
Views: 14740

Re: Any argument against Roth conversion if your top tax bracket will likely stay the same or increase?

TheTimeLord wrote: Thu Nov 03, 2022 7:53 pm
FreddieFIRE wrote: Thu Nov 03, 2022 2:39 pm
MrJedi wrote: Tue Nov 01, 2022 1:15 pm Heavy QCDs
Charitable beneficiary
Unplanned income loss
That's a good list. I would also add the mother of all reasons, extensive uninsured long term care costs.
It seems like you could use that logic against any form of retirement spending. There must be some parameters that can be reasonable put around asset level to in regards to mitigating this risk. I mean if you are worried about extensive uninsured long term care costs then how could you ever consider QCDs?
All of the listed items would likely reduce taxable income. Most other retirement spending does not. LTC costs are usually fully deductible as medical expenses. I've seen many TaxAide clients where LTC costs reduced their taxable income to zero.
by Chip
Thu Nov 03, 2022 6:36 am
Forum: Personal Investments
Topic: Locating international fund - tax deferred?
Replies: 33
Views: 3352

Re: Locating international fund - tax deferred?

Can you explain how the adjustment works and why you should be concerned above $20k. Right now, my dividend income is substantially skewed towards foreign income and the foreign portion is well in excess of $20k. I hadn’t given this much thought, but maybe I should have. I use a CPA, not TurboTax, and this has never been flagged. The adjustment reduces the amount of qualified foreign dividends that are used in the calculation of the percentage of foreign income to total taxable income (Form 1116, Line 19). That percentage can affect whether all of the foreign withholding can be claimed as a credit. The lower it is, the lower amount of foreign tax credit that can be claimed. The adjustment isn't required if foreign qualified dividends are l...
by Chip
Thu Nov 03, 2022 5:16 am
Forum: Investing - Theory, News & General
Topic: Any argument against Roth conversion if your top tax bracket will likely stay the same or increase?
Replies: 196
Views: 14740

Re: Any argument against Roth conversion if your top tax bracket will likely stay the same or increase?

If you retire at the same marginal tax rate, a Roth conversion is still a net benefit if you pay the tax from a taxable account. The reason is that it effectively tax-defers more money. I believe this statement is incomplete. A Roth conversion could be net benefit. But that won't be known until much of the tIRA is withdrawn by the account owner or their beneficiaries. So the tax rates experienced over the life of the account are the important metric, not just "the rate at which you retire". As an example, we have been converting to Roth for most of the last 19 years. But so far all that has meant is that we've prepaid a lot of taxes and avoided some tax drag on our taxable accounts. I calculate that avoided tax drag to date at on...
by Chip
Wed Nov 02, 2022 5:14 am
Forum: Personal Investments
Topic: Locating international fund - tax deferred?
Replies: 33
Views: 3352

Re: Locating international fund - tax deferred?

As livesoft said, it's not the concern about filing F1116 that's the issue for me. It's the "adjustment" that must be made once foreign qualified dividends exceed 20k. The adjustment is simple and handled automatically by my tax software. But depending on the particulars of the tax situation it may cause a substantial reduction in the amount of the foreign tax credit that is allowed to be claimed. This is particularly true for those in lower tax brackets, like some early retirees. For an investment like VXUS a 500k position will avoid the 20k adjustment for now . Assuming a 4.2% yield and 75% QDI gives about 16k in qualified dividends. But one would have to be concerned about growth pushing QDI over 20k in the future, especially i...
by Chip
Mon Oct 31, 2022 11:57 am
Forum: Investing - Theory, News & General
Topic: Bond fund or individual bonds in retirement?
Replies: 157
Views: 12611

Re: Bond fund or individual bonds in retirement?

However including a non-rolling bond ladder in your IRA wouldn't require any additional steps using Fidelity's automatic RMD service, merely a choice to use "Fixed Amount/Percentage Distributions" instead of "Proportional Distributions". All the coupon and principal payments from the ladder will flow into your "Core Position(s)", so you just set withdrawals to preferentially come from that fund. Perhaps I don't understand Fidelity's terms for the automatic RMD service. But as best I can tell from their form , in the situation where the interest and principal from the ladder don't provide enough funds for the RMD, Fidelity will only liquidate open end mutual funds. So, no individual bonds, CDs or ETFs. If there...
by Chip
Mon Oct 31, 2022 8:02 am
Forum: Investing - Theory, News & General
Topic: Bond fund or individual bonds in retirement?
Replies: 157
Views: 12611

Re: Bond fund or individual bonds in retirement?

The bonds themselves require no management, but the cash flows they produce do. Even if those cash flows are spent they must still be integrated into overall cash management. It's my contention that the ladder increases overall complexity. For us it's not worth it. Others can certainly feel differently. The other way to avoid the "complexity" of spending your retirement income is to not have any income. If you enter a trade order to sell shares of a mutual fund or ETF, you still have that money in your settlement account or bank account: the only difference between doing that and having an individual bond is that the latter doesn't require the extra step of entering the trade order. You make it sound so simple, but it's not for t...
by Chip
Sun Oct 30, 2022 3:25 pm
Forum: Investing - Theory, News & General
Topic: Bond fund or individual bonds in retirement?
Replies: 157
Views: 12611

Re: Bond fund or individual bonds in retirement?

vineviz wrote: Sun Oct 30, 2022 2:55 pm
Blues wrote: Sun Oct 30, 2022 2:53 pm Once I'm gone, my wife would be exactly the sort of person who should not own individual bonds...not from any lack of mental acuity, but from a profound lack of interest in actively managing a portfolio of bonds, which would lead to her being overwhelmed by the task.
Once a non-rolling ladder of bonds is created, there is nothing left to manage. The ladder is completely self-liquidating, requiring no further effort at all.
The bonds themselves require no management, but the cash flows they produce do. Even if those cash flows are spent they must still be integrated into overall cash management. It's my contention that the ladder increases overall complexity. For us it's not worth it. Others can certainly feel differently.
by Chip
Sun Oct 30, 2022 2:58 pm
Forum: Investing - Theory, News & General
Topic: Bond fund or individual bonds in retirement?
Replies: 157
Views: 12611

Re: Bond fund or individual bonds in retirement?

The idea of a non-rolling ladder used for liability matching is to spend all the cash flows. The the principal and coupons are deposited into your settlement fund. Just transfer from your settlement fund to your checking account as the cash is needed. In the meantime, the cash earns some interest in the settlement fund. I understand that and have read most of the threads here on LMPs. But there's a built-in assumption that the ladder, set up far in advance, matches the spending needs throughout its life. I believe that's a pretty tenous assumption. So at some (most?) points during the life of the ladder there's going to be a need for more money for spending, or leftover ladder money to be reinvested. That money has to come from or go to so...
by Chip
Sun Oct 30, 2022 2:37 pm
Forum: Investing - Theory, News & General
Topic: Bond fund or individual bonds in retirement?
Replies: 157
Views: 12611

Re: Bond fund or individual bonds in retirement?

Blues wrote: Sun Oct 30, 2022 1:44 pm Which funds are you planning to use, if you've already considered them?
I'm using SCHP (intermediate TIPS fund) and SCHR (intermediate nominal treasury fund). We already have about 40% of our fixed income in those two funds.
by Chip
Sun Oct 30, 2022 1:38 pm
Forum: Investing - Theory, News & General
Topic: Bond fund or individual bonds in retirement?
Replies: 157
Views: 12611

Re: Bond fund or individual bonds in retirement?

One thing I absolutely do not want is to leave my spouse with a stack of bonds she needs to understand and manage. Selling funds and taking RMDs will be enough. Ironically she actually has a TD account, but there is nothing in it. I'd argue that a non-rolling ladder of bonds is easier to understand, and essentially requires no management since it is inherently self-liquidating. Unless it is spent a non-rolling ladder requires management of interest and principal payments. See dbr's anecdote that you chose not to quote. I share dbr's POV. Once all of the individual TIPS and CDs we own mature it will all be in two bond funds, with dividends reinvested. It will be much simpler for my wife to liquidate an RMD from one of those funds once a yea...
by Chip
Sun Oct 30, 2022 1:22 pm
Forum: Personal Finance (Not Investing)
Topic: Capital gains upon sale of my house after my spouse has passed away.
Replies: 6
Views: 970

Re: Capital gains upon sale of my house after my spouse has passed away.

cas wrote: Sun Oct 30, 2022 11:58 am You have up to 2 years to sell the house and still qualify for the $500,000 married-level exclusion.
Thanks for posting that, cas. I learned something today. :beer
by Chip
Sun Oct 30, 2022 5:07 am
Forum: Personal Finance (Not Investing)
Topic: Real world expenses changes after retirement
Replies: 36
Views: 5364

Re: Real world expenses changes after retirement

cresive wrote: Fri Jun 03, 2022 9:31 am What have those who have actually retired experienced? Did you realize a reduction in expenses or did other expenses fill the void?
Previous thread here: viewtopic.php?t=375377
by Chip
Sat Oct 29, 2022 5:39 am
Forum: Personal Investments
Topic: Vanguard Dollars Under Advisement
Replies: 13
Views: 1818

Re: Vanguard Dollars Under Advisement

Binx wrote: Fri Oct 28, 2022 5:19 pm Can anyone tell me what I get with Vanguard dollars under advisement.
I can tell you what you won't get: protection from a similar bond/stock decline in the future.

I agree with delamer; you may not need to do anything. Though nearly all of us have urges to "do something" in the face of losses. Taming those urges is a big step towards becoming a better long term investor.
by Chip
Sat Oct 29, 2022 4:46 am
Forum: Personal Finance (Not Investing)
Topic: Roth Conversion - Federal Tax
Replies: 4
Views: 782

Re: Roth Conversion - Federal Tax

Combining the two suggestions above would work well.

1. Figure out the safe harbor amount.
2. Withhold the necessary amount from the conversion to meet that safe harbor.
3. Replenish the withheld amount from your taxable account back into the tIRA via a 60 day rollover.

I think the only gotcha with this is that only one 60 day rollover is allowed in any 12 month period. So plan accordingly.
by Chip
Sat Oct 29, 2022 3:30 am
Forum: Personal Investments
Topic: What are Bogleheads' opinion on CPWAs compared to CFP/CFA?
Replies: 10
Views: 1320

Re: What are Bogleheads' opinion on CPWAs compared to CFP/CFA?

pinecone wrote: Fri Oct 28, 2022 3:05 pm Family member's investments approx $5 million
Note vineviz's comments.

It's pretty hard for me to imagine that any advice the CPWA could provide would be worth paying 62k every single year. PAS plus fee-only CFP, estate attorney, CPA, etc. as needed seem more appropriate at that level of wealth (and many higher levels as well).
by Chip
Fri Oct 28, 2022 2:58 pm
Forum: Personal Investments
Topic: What are Bogleheads' opinion on CPWAs compared to CFP/CFA?
Replies: 10
Views: 1320

Re: What are Bogleheads' opinion on CPWAs compared to CFP/CFA?

I didn't know that designation and my first thought was that it was one of those made-up things that sound good. But it appears to be a real thing with some training via the Booth School at the University of Chicago. From https://www.finra.org/investors/professional-designations/cpwa : Candidate must meet all of the following: Bachelor's degree from an accredited college or university or one of the following designations or licenses: CIMA, CIMC, CFA, CFP, ChFC or CPA license A satisfactory record of ethical conduct, as determined by IMCA’s Admissions Committee Five years of professional client-centered experience in financial services or a related industry Is the family member particularly wealthy (15+ million)? I would personally avoid suc...
by Chip
Sat Oct 22, 2022 5:39 am
Forum: Personal Finance (Not Investing)
Topic: Currency trading loss goes where on Form 1040?
Replies: 12
Views: 1450

Re: Currency trading loss goes where on Form 1040?

Kagord wrote: Sat Oct 22, 2022 5:26 am OK, this link is better than anything I can come up with, but sounds like a full write off on 1040, line 21:

https://ttlc.intuit.com/community/inves ... s/00/32349
I disagree. Section 988 doesn't apply to personal transactions, which I believe this is. Quote from https://www.law.cornell.edu/uscode/text/26/988:

(e) Application to individuals
(1) In general

The preceding provisions of this section shall not apply to any section 988 transaction entered into by an individual which is a personal transaction.


If it were me I would apply capital gain/loss treatment.
by Chip
Wed Oct 19, 2022 11:58 am
Forum: Personal Investments
Topic: Cash in portfolio for distributions ?
Replies: 10
Views: 1121

Re: Cash in portfolio for distributions ?

livesoft wrote: Wed Oct 19, 2022 9:17 am I don't think it will really matter. Suppose you leave $6K loitering in your account and it drops 20%, then that's a mere $120 loss. What would you do with an extra $120? Maybe buy a pair of good shoes?
Might want to do that arithmetic again. It'd be a REALLY good pair of shoes.
by Chip
Wed Oct 19, 2022 6:12 am
Forum: Personal Finance (Not Investing)
Topic: IRS annual inflation adjustments for tax year 2023 announced
Replies: 38
Views: 6549

Re: IRS annual inflation adjustments for tax year 2023 announced

Carl53 wrote: Wed Oct 19, 2022 6:00 am Interesting that the extensive link makes no mention to Retirement Saver's Credit either.
I see that omission. There don't seem to be any retirement-related adjustments in this particular RP. Maybe a separate RP is issued for those adjustments??
by Chip
Wed Oct 19, 2022 4:24 am
Forum: Personal Finance (Not Investing)
Topic: IRS annual inflation adjustments for tax year 2023 announced
Replies: 38
Views: 6549

Re: IRS annual inflation adjustments for tax year 2023 announced

marcopolo wrote: Tue Oct 18, 2022 11:14 pm I didn't notice Capital Gains brackets in the release. Are they set at different times?
They are in the revenue procedure linked in the news release:

https://www.irs.gov/pub/irs-drop/rp-22-38.pdf

0% LTCG bracket ends at 89,250 for MFJ.
by Chip
Wed Oct 19, 2022 4:09 am
Forum: Personal Investments
Topic: Mechanics of buying TIPS on secondary market
Replies: 3
Views: 588

Re: Mechanics of buying TIPS on secondary market

privateer79 wrote: Wed Oct 19, 2022 3:50 am Any advice would be greatly appreciated….
There's a long thread devoted to the mechanics of buying TIPS and nominal Treasuries:

viewtopic.php?t=378350
by Chip
Tue Oct 18, 2022 5:40 am
Forum: Investing - Theory, News & General
Topic: The bad news about the 60/40 portfolio
Replies: 138
Views: 19514

Re: The bad news about the 60/40 portfolio

By the way, do you know how I can copy only part of a previous quote? I don't want to take up a lot of space by copying an entire, lengthy previous post if it's not necessary. Thanks. I, for one, really appreciate efforts that posters make to reduce the amount of unnecessary quoted text in their replies. So thank you. The "delete the part you don't want" works, but be sure to preview before posting. It's easy to mess up the quote tags when deleting, especially if there are nested quotes. A tip I learned here, which is especially helpful with extremely long posts, is the following: 1. Click the Post Reply button at the bottom of the page. (NOT the " button on the post). 2. Scroll to the particular post you want to quote from....
by Chip
Sat Oct 15, 2022 8:49 am
Forum: Personal Consumer Issues
Topic: rafting Grand Canyon
Replies: 18
Views: 1920

Re: rafting Grand Canyon

CloseEnough wrote: Fri Oct 14, 2022 9:27 am I am thinking I'd prefer doing the full trip with a non-motorized outfit, oar by guide, with option to paddle.
We did a 14 day trip on rafts (rowed by guides) with OARS several years ago. They are a class outfit, with great attention to safety. Excellent food all through the trip. Even though they are pricey I would highly recommend them.

My first recommendation: order twice as much beer as you think you'll need.
by Chip
Fri Oct 14, 2022 6:27 am
Forum: Personal Consumer Issues
Topic: auto tire pressure
Replies: 68
Views: 6010

Re: auto tire pressure

lazydavid wrote: Fri Oct 14, 2022 5:35 am Costco also inflates tires to the manufacturer spec, and uses a torque wrench on the lug nuts (bolts in my case) to the correct values.
+1. I was pleasantly surprised at this the first time I bought tires at Costco after enduring lug nut overtorquing and overpressure idiocy at other tire places. Because of those other incidents I always check pressure and torque after a purchase. Costco was right on the money.
by Chip
Fri Oct 14, 2022 4:22 am
Forum: Personal Consumer Issues
Topic: Private Golf Course Membership
Replies: 47
Views: 6023

Re: Private Golf Course Membership

vgc303 wrote: Thu Oct 13, 2022 10:55 am Just figured I'd post a real data point after reaching out to my local private club:
  • The "discounted" junior membership for my age has an initiation fee of $90k. $45k is due upfront to join the waitlist, $15k of which is non-refundable
  • The waitlist is currently 5 years long
  • The initiation fee does not purchase equity in the club, it is just as it says, a one time fee
I think I'll be sticking to public golf for the foreseeable future :shock:
I'd suggest that if a recession occurs you might consider talking to them again several months into it. I know someone who negotiated away the upfront fee at a local club (though more like 5k than 90k!) and got them to waive the dining room minimums after 2008-9.
by Chip
Thu Oct 13, 2022 4:25 am
Forum: Personal Consumer Issues
Topic: Passport renewal time - what’s the current time frame?
Replies: 203
Views: 31032

Re: Passport renewal time - what’s the current time frame?

Sent in passports to Philadelphia for renewal on 8/22. Did not request expedited service.

Checks cashed on 8/29.

Received new passports on 10/11. So 50 days, including mailing time.

I signed up for email notifications but never received anything.
by Chip
Tue Oct 11, 2022 7:17 am
Forum: Personal Investments
Topic: 12% Bonds?
Replies: 18
Views: 4180

Re: 12% Bonds?

HomerJ wrote: Mon Oct 10, 2022 1:41 pm Really surprised that Proctor and Gamble has bonds paying that much... Are they in trouble? Why wouldn't they refinance with lower interest bonds?
ProctEr & Gamble issued those 8% coupon bonds in 1989. 8% was probably a reasonable coupon for a 40 year bond from a AAA rated company at the time. As best I can tell those bonds aren't callable. So to refinance they'd have to buy them on the open market and pay a significant premium to face value, plus pay an investment bank to make it happen. Then pay the costs associated with issuing more debt.

Refinancing is probably a net negative overall....