Search found 11502 matches

by lakpr
Sun Mar 17, 2024 8:57 pm
Forum: Personal Investments
Topic: TIRA or RIRA
Replies: 4
Views: 386

Re: TIRA or RIRA

Roth IRA for sure.

As long as you make at least $2k contribution to the IRA (either Traditional or Roth), you can snag the Savers Credit. It only matters if you want to get the 20% credit instead of the 10% credit, which would require your adjusted gross income to drop below $24k per year. And this step is possible only if you contribute at least $12k to the 401(k) plan at work, IF you have one.
by lakpr
Sun Mar 17, 2024 8:14 pm
Forum: Personal Investments
Topic: Nervous about giving out information
Replies: 30
Views: 2165

Re: Nervous about giving out information

beyou wrote: Sun Mar 17, 2024 7:48 pm
Metsfan91 wrote: Sun Mar 17, 2024 7:47 pm Create an username which you have not used anywhere else. Choose an username that doesn’t reveal anything about you. Look at my username for example. There are millions of Mets fans in the US. I am one in millions. :-)
After last season, not so sure there are millions left.
With Mets and Jets, we lose Bets :D (( not mine, I borrowed it from an ex-colleague ))
by lakpr
Sun Mar 17, 2024 7:33 pm
Forum: Personal Investments
Topic: Thoughts on GQRPX? [GQG Partners Global Quality Equity Fund]
Replies: 4
Views: 273

Re: Thoughts on GQRPX? [GQG Partners Global Quality Equity Fund]

ALL of them have high expense ratios. GQRPX (0.95%), JAWWX (0.8%), NPFFX (0.8%), OPPAX (1.06%), ANFFX (0.8%).

If you want exposure to global stocks, you can buy VXUS for 0.08%, 1/10th or less of the funds you listed.
by lakpr
Sun Mar 17, 2024 7:25 pm
Forum: Personal Investments
Topic: 401K Rollover to Vanguard IRA Question!
Replies: 17
Views: 1120

Re: 401K Rollover to Vanguard IRA Question!

Sweetbriar wrote: Sun Mar 17, 2024 6:35 pm
Faith20879 wrote: Sun Mar 17, 2024 5:56 pm OP, I also have a TRP 401k that I've not rolled over yet, for two reasons:
1. I've not got a chace to look into my state's laws about IRA protection vs a 401K. I'm 90% sure they are equally protected but i am in no real hurry.
2. My state exempts part of my 401k distribution from taxable income but not IRA distinction. So again I'm in no hurry to roll it over.

Faith20879....#2 Wow!...What State would that be? Don't think CA would even think of that.
Sweetbriar, are you in California? GASP!! I would implore you to *NOT* roll the 401(k) to an IRA. The IRA protections in California are the weakest in the entire nation. Having the money in 401(k) means it is governed by ERISA protections ...
by lakpr
Sun Mar 17, 2024 5:08 pm
Forum: Personal Investments
Topic: 401K Rollover to Vanguard IRA Question!
Replies: 17
Views: 1120

Re: 401K Rollover to Vanguard IRA Question!

Any good reason why you do not want to leave the 401(k) in place? Sounds like they have even cheaper expense ratios than Vanguard IRA. You are only going to increase the fund expenses if you move to IRA. Thanks Lakpr.....# 1 reason, our Vanguard taxable, my IRA, his IRA...all in one place! :happy Good enough reason, although I would have put up with an additional account if I were in your shoes. My 401(k) for example charges 0.02% for an S&P 500 institutional fund, which is half of the 0.04% Vanguard charges in IRA. At my *current* balance in that fund in my 401(k), this comes out to be a savings of $260 per year, and perhaps will even increase before my retirement (I am 54 years old, and expected retirement date is about 5 years away ...
by lakpr
Sun Mar 17, 2024 4:47 pm
Forum: Personal Investments
Topic: VBILX vs MassMutual Stable Value Diversified HELP please
Replies: 3
Views: 377

Re: VBILX vs MassMutual Stable Value Diversified HELP please

I would absolutely NOT invest in VBILX . As has been correctly pointed out, if rates drop in the future, the yield from VBILX will also drop. You may find that 3.69% would be super-competitive with the yield offered by VBILX. If the rates do NOT get cut (something happens that thwarts the market expectations), guess what happens to your investment in VBILX? It *DROPS* -- even if the rates stay the same. The yield of the bond fund does not depend on the actual rates, only the market expectation of the rates . The reason for the drop you will see on Morningstar or CNN or CNBC will be that "Fed decided to hold off the rate cuts for now". You have just put your principal also at risk for no good reason. *IF* your reasons for investin...
by lakpr
Sun Mar 17, 2024 4:30 pm
Forum: Personal Investments
Topic: 401K Rollover to Vanguard IRA Question!
Replies: 17
Views: 1120

Re: 401K Rollover to Vanguard IRA Question!

Any good reason why you do not want to leave the 401(k) in place? Sounds like they have even cheaper expense ratios than Vanguard IRA. You are only going to increase the fund expenses if you move to IRA.
by lakpr
Sun Mar 17, 2024 3:17 pm
Forum: Personal Investments
Topic: Portfolio advice for young beginner
Replies: 9
Views: 1314

Re: Portfolio advice for young beginner

I suggest buying VFIAX in Roth (you want a different investment in Roth than what is in taxable). This sale from VASGX to VFIAX must happen first. r.e. the wash rules, if I understand correctly, if I want to tax loss harvest in the future, I will be selling off VTSAX (or whatever investment is in my taxable acct). But, if my roth IRA holds VTSAX and the dividends get reinvested automatically, it will trigger the wash sale rule, is that correct? Why do you recommend to do the Roth sale first? Are there any concerns with selling? I don't think I've sold a position before. If you hold the same investment in an IRA as you do in taxable account, and you sell that investment in taxable for loss, the loss "travels" to the existing inves...
by lakpr
Sat Mar 16, 2024 8:38 pm
Forum: Personal Investments
Topic: Please check my thinking about changing my Roth account from VTIAX to VTSAX
Replies: 42
Views: 3419

Re: Please check my thinking about changing my Roth account from VTIAX to VTSAX

Another vote for all US in Roth. Vanguard has lead many astray with its international recommendations. If you agree that the amount of international equities in target date funds represents their international recommendation, then Vanguard is not alone. Both Vanguard and Fidelity have a 60/40 asset allocation between US/International in their index target date funds. Agreed about the composition of the US vs international allocation at either Vanguard or Fidelity, but I would not take that either as a recommendation, or even if it were, that I am obligated to follow. I would SERIOUSLY question if that high an allocation to international equities is appropriate FOR ME. As had been drummed repeatedly into me (on a different topic, not intern...
by lakpr
Sat Mar 16, 2024 8:35 pm
Forum: Personal Investments
Topic: HELP - what to invest in for 750,000 windfall
Replies: 14
Views: 1968

Re: HELP - what to invest in for 750,000 windfall

Are you currently maximizing the contributions to all tax-deferred / tax-advantaged vehicles? 1) $23k at an employer retirement plan: 401(k), 403(b), 457(b) 2) $7k for Roth IRA 3) $10k in I-bonds purchases per year per SSN 4) Any Mega Backdoor opportunity at your employer? If you aren't doing at least the first three, do it. If this results in a shortfall from your paycheck, use this $750k windfall for living expenses. Do you own a home, if so is there a mortgage on it, and if so, what is the rate? If the rate is anything above 4.5%, it is worth paying off that mortgage than investing. If it is anything more than 3.5% and you are *NOT* itemizing deductions (taking the standard deduction on your tax returns), then it is also worth paying it ...
by lakpr
Sat Mar 16, 2024 7:19 pm
Forum: Personal Investments
Topic: Rollover 403b into IRA
Replies: 11
Views: 610

Re: Rollover 403b into IRA

The original employer was a Hospital. Will Fidelity be able to tell me if the plan is covered by Erisa, or only the hospital benefits folks? You should get your Summary Plan Description document from the benefits folks. *IN GENERAL*, if either/both of the following true, your plan is very likely a non-ERISA plan. 1) You have access to a pension offered by the employer (or a pension offered by the government - state or municipal or Federal, by virtue of being the employee of this organization. For example, my wife is a school teacher in a school district in NJ; while her school district does not offer pension, by virtue of being an employee of the school district she's eligible for pension from the State of New Jersey. THAT, makes her 403(b...
by lakpr
Sat Mar 16, 2024 7:15 pm
Forum: Personal Investments
Topic: Rollover 403b into IRA
Replies: 11
Views: 610

Re: Rollover 403b into IRA

ResearchMed wrote: Sat Mar 16, 2024 6:28 pm Okay, thanks for the clarification about government employers.

However, I'd still suggest being very careful about generalizing whether 403b plans have ERISA coverage, so no one makes an incorrect assumption about their own plan.

Our ERISA plan also has nothing to do with any hospital or healh care.
We are with an educatioal institution that *does* have an ERISA 403b plan,

RM
Your plan is one of those rare exceptions. Just because it is an exception does not make the generalization false.
by lakpr
Sat Mar 16, 2024 6:20 pm
Forum: Personal Investments
Topic: Rollover 403b into IRA
Replies: 11
Views: 610

Re: Rollover 403b into IRA

Agreed about your point. I meant that *in general*, 403(b) plans are not covered by the ERISA act. The ERISA act itself generally carved out exemptions for government employers, IIRC. I'm still not sure what you mean about "in general". Some 403b plans are covered by ERISA, and some are not. Did you mean that the "exemptions" were that government employers *do* have ERISA coverage? Or that they do not? Our large 403b plan most definitely IS an ERISA plan, and we have nothing at all to do with any governmental employer. RM Government 403(b) plans are *NOT* for sure covered by ERISA. Private organizations (generally hospitals) that offer 403(b) plans ARE covered by ERISA. When I say ERISA carved out an exemption for gover...
by lakpr
Sat Mar 16, 2024 6:16 pm
Forum: Personal Investments
Topic: Question about bonds allocation
Replies: 11
Views: 832

Re: Question about bonds allocation

@dpow, My earnest suggestion: *DO NOT* invest in any bond FUND. Not unless you want to put your principal at risk. And if you DO want to put your principal at risk, do it on the equities side. Let me propose a deal for you, and you tell me whether it is good or bad. 1) Give me $100, I will pay you back $4.5 per year for approximately the next 7 years 2) At the end of the 7 years, you can opt to take your money back or leave it with me 3) If you do opt to keep the money with me, I may pay you only $2 per year at that time, not $4.5 4) I will also say that at the end of those 7 years, if you choose to get your money back, I may not pay you back the $100. It will not be $0 for sure, that's about the only guarantee I will give you. It can be $4...
by lakpr
Sat Mar 16, 2024 6:04 pm
Forum: Personal Investments
Topic: Rollover 403b into IRA
Replies: 11
Views: 610

Re: Rollover 403b into IRA

The pros of leaving the money within the 403(b) are: - possible creditor protections. Note that the 403(b) are *NOT* covered by the ERISA code , but since they are deemed employer plans, creditors / judgment holders will have to jump through some hoops to access that money. IRAs are governed by state law, and while about 43 states DO provide creditor protections on par with ERISA, there are still 7 states that do not. What guarantee is there that you will not travel to a state that do not protect IRAs and get into an at-fault auto-accident there (assume the liability exceeds your auto-insurance limits)? [emphasis added] I'm not sure if you are referring to any specific 403b plans, but SOME 403b plans *ARE* covered by ERISA. So before makin...
by lakpr
Sat Mar 16, 2024 5:40 pm
Forum: Personal Investments
Topic: Rollover 403b into IRA
Replies: 11
Views: 610

Re: Rollover 403b into IRA

The pros of leaving the money within the 403(b) are: - possible creditor protections. Note that the 403(b) are *NOT* covered by the ERISA code, but since they are deemed employer plans, creditors / judgment holders will have to jump through some hoops to access that money. IRAs are governed by state law, and while about 43 states DO provide creditor protections on par with ERISA, there are still 7 states that do not. What guarantee is there that you will not travel to a state that do not protect IRAs and get into an at-fault auto-accident there (assume the liability exceeds your auto-insurance limits)? - possible lower fees than the Admiral shares you can buy at Vanguard. While my own retirement plan is not a 403(b) but a 401(k), I have acc...
by lakpr
Sat Mar 16, 2024 2:42 pm
Forum: Personal Investments
Topic: Bond Investing
Replies: 21
Views: 2786

Re: Bond Investing

LarryDavid wrote: Sat Mar 16, 2024 12:11 pm Can you help me understand this statement better: "If you value safety in your "fixed income" and not see it evaporate 13% (intermediate term bond fund) to 30% (long term bond fund), stick to I-bonds."

What are the percentages?
Those are the losses experienced by Total Bond fund and Long Term Treasury Bond fund, respectively, in 2022.
by lakpr
Sat Mar 16, 2024 10:43 am
Forum: Personal Investments
Topic: Cash or CD's Instead of Bond Funds
Replies: 61
Views: 5441

Re: Cash or CD's Instead of Bond Funds

goblue100 wrote: Sat Mar 16, 2024 9:54 am Yes, which I did not do. :oops: But having gone through one of the worst periods for bonds in history, I'm not going to quit playing this game now.
Ditto (to the "did not do" part). So far down about $43k. I don't say I quit playing this game, but only letting the money already wagered, ride. But not a penny more.
by lakpr
Sat Mar 16, 2024 10:38 am
Forum: Personal Investments
Topic: Retiring Soon-Questions about rollovers
Replies: 7
Views: 1213

Re: Retiring Soon-Questions about rollovers

Wannaretireearly wrote: Sat Mar 16, 2024 9:43 am Following. Are the ‘weak’ rules in CA applicable to both TIRA and Roth IRA?
YEP. No difference between a tIRA or rIRA.
by lakpr
Sat Mar 16, 2024 10:35 am
Forum: Personal Investments
Topic: Cash or CD's Instead of Bond Funds
Replies: 61
Views: 5441

Re: Cash or CD's Instead of Bond Funds

Ok, but if I don't like the offer you have to keep paying me $6 every year until I do. I will change my mind at the 7 year mark you see, I will may start paying you only $2 per year at that time. Or $12, we will roll a dice or use a random number generator to see. I'm starting to like this game we are inventing. Oh it will be a random generator for sure, but you are dreaming if you think you have any control over who gets to roll the dice. You are also dreaming if you think you can predict or check whether the random number I'm going to give you is a true number or not .. good luck with that. "You just have to trust" that eventually you will be a winner in this game. "Didn't you read the prospectus?" edited to add: this...
by lakpr
Sat Mar 16, 2024 10:33 am
Forum: Personal Investments
Topic: Cash or CD's Instead of Bond Funds
Replies: 61
Views: 5441

Re: Cash or CD's Instead of Bond Funds

hudson wrote: Sat Mar 16, 2024 9:41 am Treasury bills and notes contrary to Boglehead orthodoxy? Not any more. What's not to like about a 0% expense ratio?
The orthodoxy I mentioned is not about holding T-bills and T-notes, but holding them in TAXABLE account. (Just clarifying).
by lakpr
Sat Mar 16, 2024 8:55 am
Forum: Personal Investments
Topic: Cash or CD's Instead of Bond Funds
Replies: 61
Views: 5441

Re: Cash or CD's Instead of Bond Funds

goblue100 wrote: Sat Mar 16, 2024 8:52 am Ok, but if I don't like the offer you have to keep paying me $6 every year until I do.
I will change my mind at the 7 year mark you see, I will may start paying you only $2 per year at that time.
by lakpr
Sat Mar 16, 2024 8:50 am
Forum: Personal Investments
Topic: Wash sale question for bi-weekly investing.
Replies: 2
Views: 313

Re: Wash sale question for bi-weekly investing.

Also make sure that you don't have VXUS in any of your IRAs, and/or you haven't bought any VXUS in the IRAs in the past 30 days nor will buy again in the next 30 days. If you do, then the loss that you realize in the taxable account travels to the IRA (the "replacement shares" are found there), and since there is no concept of "basis" in an IRA the loss is permanently disallowed.
by lakpr
Sat Mar 16, 2024 8:40 am
Forum: Personal Investments
Topic: Retiring Soon-Questions about rollovers
Replies: 7
Views: 1213

Re: Retiring Soon-Questions about rollovers

I have serious reservations about rolling anything into an IRA while being a resident of California. The IRA protections in California are particularly weak, and the most notorious in the entire nation for being such weak protections. While 403(b) assets are also NOT technically protected in California, I do believe that, being employer-based plans, they enjoy better protections than IRAs. Think about this way: having the money in a 403(b) account is like getting a free umbrella insurance for the amount that you have in the 403(b) plan. The insurance may not be needed, if ever, but probably will be there when you need it. I do see that the Voya plan is charging 0.25% fee for keeping the assets within the plan, so please weigh what this 0.25...
by lakpr
Sat Mar 16, 2024 8:28 am
Forum: Personal Investments
Topic: Cash or CD's Instead of Bond Funds
Replies: 61
Views: 5441

Re: Cash or CD's Instead of Bond Funds

I am completely soured on bond funds, and decided to NEVER INVEST A PENNY MORE in any bond fund going forward. For me, I won't say NEVER, but I'll be very wary. People need to quit taking the drop in bonds personally. Rates went up, bonds went down. Now we are being compensated with better dividends. My prediction is in a few years people will be complaining about the lack of returns from their stack of CD's. Let me make an offer to you. Give me $100, I will pay you $6 every year, and at the end of 7 years I will return something other than $100. It will not be $0, it will not be $100, it depends on my fancy and mood at that time. Sounds like a deal? Take the emotions out of it. You are looking for better dividends right? I am offering the...
by lakpr
Fri Mar 15, 2024 9:53 pm
Forum: Personal Investments
Topic: Please check my thinking about changing my Roth account from VTIAX to VTSAX
Replies: 42
Views: 3419

Re: Please check my thinking about changing my Roth account from VTIAX to VTSAX

I have always kept the dogs - bonds and international equities -- penned in tax deferred accounts. Roth accounts are absolutely dedicated to US equities.

Yes I expect the dogs continue to be dogs for the next 10 years at least. You are welcome to borrow my crystal ball.

GerryL, I absolutely am on board with your plan. Not only that, I would encourage you to reduce your international equities to 20% of your equities, not 40%.

Edit : slight correction, if you count I bonds I have some "bonds" in taxable so I perhaps haven't completely penned the dogs in tax-deferred....
by lakpr
Fri Mar 15, 2024 7:58 pm
Forum: Personal Finance (Not Investing)
Topic: 14 years old - Contribute to Roth IRA, become business partner?
Replies: 5
Views: 492

Re: Roth Recharacterization / Backdoor Roth questions

andy2012 wrote: Fri Mar 15, 2024 7:02 pm Somewhat related question:

1) Can a 14 years old who is working summer, contribute to Roth IRA?
2) Can a 14 years old become a General Partner and signer in a business?
Know for sure that the answer is YES to 1)
I THINK NO to the second question due to being a minor
by lakpr
Fri Mar 15, 2024 7:47 pm
Forum: Personal Investments
Topic: Portfolio Review Request
Replies: 23
Views: 3564

Re: Portfolio Review Request

The earnings on the non deductible contributions are also pretax. I would rollover everything except the basis. As I remarked before, "the market ate my basis" is NOT a valid excuse. So move the exact basis amount and put it in a money market, then rollover the remainder to the 401(k) first. Only then convert the basis (whatever is left back) to Roth IRA without having to pay $$$ in taxes.
by lakpr
Fri Mar 15, 2024 2:43 pm
Forum: Personal Investments
Topic: Roth Recharacterization / Backdoor Roth questions
Replies: 5
Views: 749

Re: Roth Recharacterization / Backdoor Roth questions

Congratulations on the raise, and thank you too for patiently answering my questions. What you will need to do is to recharacterize the non-deductible contribution already made to traditional IRA. Then add the remainder (full $7,000) to the same account, then convert the entire balance, including earnings, to Roth IRA. Do you know which tax forms I would need for 2024 and 2025? I just want to make sure I have those right when I need to submit them. Would the 2025 be different forms because no recharacterization? Form 8606 is where you will document the non-deductible contribution, and the Roth conversion, when you file taxes next year in 2025. Since you are contributing for the year 2024, the Form 8606 should only be filed NEXT YEAR for th...
by lakpr
Fri Mar 15, 2024 1:37 pm
Forum: Personal Investments
Topic: Good Problem to Have: What to do with Cash? and keep it simple.
Replies: 4
Views: 1225

Re: Good Problem to Have: What to do with Cash? and keep it simple.

I have been buying up T-bills lately, and hold them all at Treasury Direct. So far I have $60k worth of I-bonds, and a tad more than $20k in T-bills. Yes, it is as simple as choosing an auction date / term, then purchase in multiples of $100 (although you CAN purchase odd amounts). Indicate whether you want to auto-roll; the catch is that you can only auto-roll up to 2 years into the future. So if you buy a 4-week T-bill, it can be auto-rolled 25 times; 8-week T-bill can be auto-rolled 12 times, etc. Then go to bed. When the auction happens, you get the same rate as the big boys. Two business days after the auction, your linked bank account will be debited for slightly less than the face amount you purchased (so a $1000 purchase will result...
by lakpr
Fri Mar 15, 2024 1:04 pm
Forum: Personal Investments
Topic: Roth Recharacterization / Backdoor Roth questions
Replies: 5
Views: 749

Re: Roth Recharacterization / Backdoor Roth questions

Your post is confusing a bit. 1) When you say "this year" do you mean 2024 or 2023? 2) If you did mean 2024, then my next question would be: did you already max out the Roth IRA for 2023? I ask because the deadline for the IRA contributions for 2023 is coming up fast, the IRA contributions for 2024 have a deadline that is more than 1 year away. Should prioritize 2023 first 3) To be requiring a backdoor Roth (recharacterization to traditional IRA and converting to Roth), you must be in the 24% tax bracket or higher. Are you? How did you realize this early in the year that you WILL BE in the 24% bracket? 4) If you are in the 24% tax bracket, then surely $7k contribution to the IRA (let's debate the type of IRA it should go to later)...
by lakpr
Fri Mar 15, 2024 12:47 pm
Forum: Personal Investments
Topic: Bond Investing
Replies: 21
Views: 2786

Re: Bond Investing

+1 to @Curb Fan's post!! I-bonds have the supreme advantage that they will NEVER GO DOWN in value unlike Total Bond fund, and also keep up with inflation. They are also tax-deferred until 30 years. Beyond the first year lockup they also function like a money market fund, in that you can withdraw as little as $25 per withdrawal + 1 cent increments thereafter. For someone younger than 50, given that the maximum - 401k deferral is $23k - Roth IRA is $7k - I-bonds purchase is $10k you can theoretically accommodate any bond allocation that is up to 33% ($10k / $30k) purely by I-bonds alone. As far as yields go, I-bonds are yielding 5.14% right now which is quite competitive with the money market funds. If you value safety in your "fixed inc...
by lakpr
Fri Mar 15, 2024 11:48 am
Forum: Personal Investments
Topic: Poor Publix employee seeking 401k investment advice - no longer have Publix stock
Replies: 296
Views: 28920

Re: Poor Publix employee seeking 401k investment advice - no longer have Publix stock

I was thinking maybe sell the Publix stock this year since it is at a very high price now $15.20 (after the 5:1 split). Then I'm not sure if I should buy the target date in my brokerage account and keep it there or sell it from the brokerage account and buy the target date in my roth account. I could also just increase my 401k contributions to 30% and invest in the aggressive balanced fund until I reinvest the $10,800 from the stock sale. I'm not sure how long I want to hold on to the crypto. I'm hoping it will go up in value over the next few months and I may sell it for a $500-1000 profit and reinvest it in the target date or aggressive balanced 401k fund. Then next year if the prices for SOCL and PNQI go up a bit more, just sell those. ...
by lakpr
Fri Mar 15, 2024 10:46 am
Forum: Personal Investments
Topic: Cash or CD's Instead of Bond Funds
Replies: 61
Views: 5441

Re: Cash or CD's Instead of Bond Funds

coachd50 wrote: Fri Mar 15, 2024 10:29 am I think a great deal of posts and discussions on this and similar topics is due to the inverted yield curve. I think perspective on many of these topics might be different if 10 year bonds were paying 3.5% more than a money market fund.
Can you blame us? If the 10-year bonds were paying 3.5% more than a money market fund, I would have bought a 10 year bond (individual bond, not bond FUNDs) pronto. For fixed income, we are most concerned with SAFETY. Fixed income is supposed to let us SWAN. If we must accept volatility, we do that on the equities side.
by lakpr
Fri Mar 15, 2024 7:06 am
Forum: Personal Investments
Topic: Buying iBonds with income tax refund
Replies: 8
Views: 486

Re: Buying iBonds with income tax refund

Exactly why I am rushing to file my taxes prior to end of March this year.
by lakpr
Fri Mar 15, 2024 6:57 am
Forum: Personal Investments
Topic: Cash or CD's Instead of Bond Funds
Replies: 61
Views: 5441

Re: Cash or CD's Instead of Bond Funds

DireStraits wrote: Fri Mar 15, 2024 6:48 am
bog007 wrote: Fri Mar 15, 2024 1:28 am yes. myga cd treasuries
Please forgive my ignorance, but what is "myga"?
Multi Year Guaranteed Annuities.

Edited to add: suitable only for people who are older than age 59.5 as of the date of maturity of the annuity. There is a 10% penalty imposed by the IRS for any withdrawals from MYGAs prior to age 59.5, even for the principal and distribution at maturity of the principal and interest.
by lakpr
Fri Mar 15, 2024 6:48 am
Forum: Personal Investments
Topic: Help: Finally trying Backdoor Roth after delaying for so many years
Replies: 8
Views: 783

Re: Help: Finally trying Backdoor Roth after delaying for so many years

Why the odd number of $3791 for 2023? Contribute the remainder up to the maximum $6500 for 2023. You have until April 15 to contribute. Perhaps even add the $7000 for 2024 at the same time. Then convert everything and pay taxes on the $804 gain. I haven't checked the math to see if it lines up, but the logic is correct and your filling out the Form 8606 is correct Sorry incorrect. You did not do the Roth conversion in 2023, IIUC. This filing would have been correct had a Roth conversion been done ending with a $0 balance as of Dec 31, 2023. But you are going to do the Roth conversion in 2024. So your Form 8606 for 2023 should reflect only the additional contribution of $3791 to increase the basis -- but I urge you to contribute the remainde...
by lakpr
Fri Mar 15, 2024 6:42 am
Forum: Personal Finance (Not Investing)
Topic: 2.9% CC and 0.25 ACH fees
Replies: 14
Views: 1450

Re: 2.9% CC and 0.25 ACH fees

Silverado wrote: Fri Mar 15, 2024 6:37 am I despise “convenience” fees since the convenience is more on their end than mine. My property tax hits me with a $0.25 fee for each ACH payment. I can live with that. But a percentage? No way.
You are one of the blessed ones! My property tax hits me with 3.2% CC fee or $2 ACH fee. I therefore schedule a BillPay from my bank to them. No fee.

For the OP, use your bank's BillPay.
by lakpr
Fri Mar 15, 2024 3:29 am
Forum: Personal Investments
Topic: Liquid cash for 5year horizon at 5% apy
Replies: 16
Views: 1555

Re: Liquid cash for 5year horizon at 5% apy

ebeb wrote: Fri Mar 15, 2024 3:24 am Unfortunately my requirement is 100% liquidity at any time between 1-5years so MYGA may be tough. :shock:
Then the only solution is Nalor's suggestion of Treasury ladder. Treasuries are extremely liquid with the tiniest spreads between bid and ask. But you won't get 5%.
by lakpr
Fri Mar 15, 2024 3:15 am
Forum: Personal Investments
Topic: Liquid cash for 5year horizon at 5% apy
Replies: 16
Views: 1555

Re: Liquid cash for 5year horizon at 5% apy

MYGAs may sort of fiill the need. https://www.blueprintincome.com/fixed-annuities/products?paymentAccountTypes=%255B%2522checking%2522%255D&investmentAmount=100000&state=NJ&terms=%255B5%255D&page=1&withdrawalAllowances=%255B2%252C3%255D&age=50 Suitable for someone older than 59.5, or at least will turn age 59.5 by the time the annuity matures. Because, any withdrawal from MYGA prior to that age, the IRS treats it as non-qualified and levies 10% penalty. Includes both the interest and principal. The MYGA itself imposes a limitation that the money will be inaccessible completely the first year, then makes 10% of the principal available for withdrawal the second year, 20% of the outstanding principal the third year, etc...
by lakpr
Thu Mar 14, 2024 8:19 pm
Forum: Personal Investments
Topic: Cash or CD's Instead of Bond Funds
Replies: 61
Views: 5441

Re: Cash or CD's Instead of Bond Funds

Raising hand!

I am completely soured on bond funds, and decided to NEVER INVEST A PENNY MORE in any bond fund going forward. I am also, contrary to the Boglehead orthodoxy, am investing in Treasury bills and Treasury Notes to build up my "bonds" in my TAXABLE account (gasp!).

So far $60k of I-bonds, $20k of T-bills. My eventual goal is to build up about $400k of "no-risk-to-principal" fixed income, which will be about 30% of my portfolio. As I add I-bonds and T-bills and T-notes (and a smattering of TIPS), I will be slowly draining away the VBTIX (Institutional version of Vanguard Total Bond fund) in my 401(k).
by lakpr
Thu Mar 14, 2024 8:10 pm
Forum: Personal Consumer Issues
Topic: Furniture prices... is this normal?
Replies: 60
Views: 9463

Re: Furniture prices... is this normal?

Are you ok with having something used? There are any number of people wanting to get rid of their bulky furniture. There are people even who are willing to give it away. In my local area, I found at least six posts for sofas that their owners want to get rid of ...

https://www.freecycle.org/

Of course, also scan Facebook Marketplace and Craigslist for your local area.
by lakpr
Thu Mar 14, 2024 10:03 am
Forum: Personal Investments
Topic: Planning Parents' Retirement strategy
Replies: 9
Views: 1396

Re: Planning Parents' Retirement strategy

I say the plan looks good. I see the following salient points, around which I'd have planned the Roth conversions if I were in your shoes too: 1) Keep both parents in the 12% tax bracket 2) Get started on the Roth IRA 5-year clock for the parent who does not have it 3) Then start Roth conversions from the Traditional IRA of the older parent until depletion. Then move on to the younger parent. The only thing I'd change if it were my plan is that, should any unexpected expenses occur, see if they can be first met out of the joint checking account / joint brokerage account. Then draw from the Traditional IRA. Yes you will incur 22% tax hit on this withdrawal, but if you withdraw from the Roth IRA, that money will have lost the opportunity to g...
by lakpr
Thu Mar 14, 2024 9:37 am
Forum: Personal Investments
Topic: Quick Trad IRA Question
Replies: 2
Views: 255

Re: Quick Trad IRA Question

Yes you can open a Traditional IRA for your spouse and take full deduction for the contribution from taxes. But I urge you to reconsider the decision, make a Roth IRA contribution for her instead.

With a $170k income you are in the 22% tax bracket. This bracket will disappear in 2026. So it will likely have the effect of dodging the taxes today at 22%, but very likely paying 25% marginal rate in retirement.

If a bank offers you a 3% cash back card, with the following caveats:
1) The cash back is limited to the first $7000 in spend per year
2) The cash back will be credited only after 2 years

Will you take the offer? IRS is exactly offering you that.
by lakpr
Thu Mar 14, 2024 7:34 am
Forum: Personal Investments
Topic: Tax Strategy
Replies: 7
Views: 1538

Re: Tax Strategy

You omitted purchase of $10k in I-bonds per year, as an extension of your tax-deferred space. You can replace the bonds in your 401(k) with equities, in an amount equal to the purchase amount of I-bonds. In my opinion this is a far superior alternative because I-bonds are guaranteed to never lose value by the full faith of the US government. You can avoid a repeat of the 2022 bloodbath in bonds. It does mean opening a Treasury Direct account -- actually two, one each for you and your spouse. Yet another account, not a simple brokerage account, as I-bonds cannot be held at a brokerage. There's also the disadvantage that unlike a taxable account, the I-bonds do not get the "step up basis" on death, the inheritor is liable to pay all...
by lakpr
Thu Mar 14, 2024 7:30 am
Forum: Personal Investments
Topic: 401k allocation/rebalance
Replies: 15
Views: 953

Re: 401k allocation/rebalance

roccodean wrote: Thu Mar 14, 2024 7:29 am Can someone tell me the difference in FXNAX and and FTBFX. I know the expense ratio on FTBFX is much higher. Is there any use to put this in my bond portion ?
One is an index fund (FXNAX) and the other is an actively managed fund (FTBFX).
by lakpr
Thu Mar 14, 2024 7:27 am
Forum: Personal Investments
Topic: Check my work: Taking over management of my parent's portfolio
Replies: 23
Views: 3152

Re: Check my work: Taking over management of my parent's portfolio

I logged in to post two points, but @KingRiggs beat me to one of it :D 1) The whole deal with the Roth is that all growth is tax free. Why would you want to suppress that growth in the Roth by holding bonds in there? 2) You have VTI and VXUS across all the accounts, including taxable. This makes it very hard to do any tax loss harvesting in the future, it could expose you to wash sales rules. The way to sidestep wash sales rules is to simply NOT hold the same investment between the IRA (either Roth IRA or traditional IRA or both) and taxable account. Since you have VTI and VXUS already in the taxable account, and presumably selling them would incur tax costs, I would suggest that you hold a combination of VOO (S&P 500 index ETF) and VXF...
by lakpr
Wed Mar 13, 2024 2:27 pm
Forum: Personal Investments
Topic: Seeking end of career 401(k) advice
Replies: 11
Views: 1769

Re: Seeking end of career 401(k) advice

How are the options in her new job's 401(k) plan? If good, can she consider rolling over the existing tIRA to the 401(k), and perhaps do backdoor Roth? Then she can get $38k into Roth this year ($30k for Roth 401k, being over age 50; $8k similarly to Roth IRA for being over the age of 50).
by lakpr
Wed Mar 13, 2024 2:24 pm
Forum: Personal Investments
Topic: TLH for BND and BNDW
Replies: 5
Views: 652

Re: TLH for BND and BNDW

Joli wrote: Wed Mar 13, 2024 2:20 pm Thank you, lakpr.
You are very welcome, glad I could help.
by lakpr
Wed Mar 13, 2024 8:39 am
Forum: Personal Investments
Topic: TLH for BND and BNDW
Replies: 5
Views: 652

Re: TLH for BND and BNDW

Joli wrote: Wed Mar 13, 2024 8:27 am One last question: would HSAs need any special consideration as all retirement accounts or can I simply sell BND and BNDW on HSA at the same time I sell BND and BNDW on taxable?
I would treat HSA as if it were another Roth IRA. Basically, sell HSA investments of BND and BNDW first before you sell those same investments in taxable.