Search found 5460 matches

by ddb
Wed Sep 02, 2020 12:17 pm
Forum: Personal Finance (Not Investing)
Topic: Amex platinum annual fee
Replies: 52
Views: 17449

Re: Amex platinum annual fee

You won't be getting your money's worth out of paying the $550 annual fee. The bottom line: travel just isn't going to recover in the next 12 months, so high-fee travel cards are a waste of money. While this is likely true for many people, I find the Platinum card useful. The $550 cost is reduced to $350 via the $200 airline travel credit (which is a cash equivalent for me given how I use it). The $350 cost is then reduced to $150 due to the Uber credit (I have to Uber home from a bar at LEAST several times a month due to overindulgence, so the credit is easily used). So what do I get for the remaining $150 credit? Centurion Lounges and able to book through Fine Hotels & Resorts (FHR). FHR, to me, makes the $550 annual fee a bargain, e...
by ddb
Wed Sep 02, 2020 11:55 am
Forum: Personal Consumer Issues
Topic: Tesla Full Self Driving Option
Replies: 177
Views: 16451

Re: Tesla Full Self Driving Option

Those who have bought Tesla, did you also by the FSD option? Why or why not? Personally, I find it hard to justify paying $8,000 in advance for an option that you don't know when it will be available. I chose not to buy FSD, because I didn't think the benefits justified the cost. The "summon" feature is cool for a few times, but overall pretty useless. The highway features aren't helpful to me, because when there are a decent number of other cars on the road, I am generally driving fast and doing lots of lane changing and variable-speed driving to get ahead of everybody, and FSD wouldn't accomplish that at all. The main benefit of FSD for me would be highway driving with very little traffic where I mostly cruise in the slow lane,...
by ddb
Tue Jun 20, 2017 11:51 am
Forum: Personal Finance (Not Investing)
Topic: Liability with dogs, hypothetical
Replies: 67
Views: 8276

Re: Liability with dogs, hypothetical

I don't really have any advice, but I did have a relevant event occur a few months ago. I was walking my dog (30-pound mixed poodle breed) through a local neighborhood where I often walk. A casual acquaintance lives in one of the houses, and he was outside when I walked by, so I stopped and we chatted a bit. I could hear his dog barking inside of his wood fenced-in backyard. Without warning, his dog, a 90-ish pound pit bull mixed breed, burst through the fence as if it wasn't even there, literally dislodging two of the nailed-in fence planks, and wrapped his mouth around my dog's midsection. I pulled HARD on my dog's leash to separate them, and the owner managed to grab hold of his dog's collar, and his dog would not relent from posturing t...
by ddb
Tue Jun 20, 2017 10:34 am
Forum: Personal Finance (Not Investing)
Topic: What's Your Credit Card Rewards Strategy?
Replies: 7203
Views: 1413391

Re: What's Your Credit Card Rewards Strategy?

I follow the /r/churning subreddit. I've amassed approximately 1.2 million points/miles since August 2016 on 17 new credit card applications. It's an enjoyable hobby. It's getting a bit more cumbersome now that I've picked the low-hanging fruit, so I may take a break in a bit. It is definitely very cool to fly international business class and first class at very minimal out-of-pocket cost.
by ddb
Thu Jun 01, 2017 3:37 pm
Forum: Investing - Theory, News & General
Topic: Using limit orders to limit losses
Replies: 21
Views: 3605

Re: Using limit orders to limit losses

I think it is better to try to buy if you can during that downturn. Agree with this if you mean to buy via rebalancing, i.e. selling other portfolio assets in order to add to the recent losers, or via systematic investing, i.e. regular investing such as 401k contributions. Disagree if you mean that one should have some "dry powder" set aside for buying opportunities. Also - you only lose when you sell at a lower price. I think this is a dangerous philosophy. To use an extreme example, I have a family member who still holds Lehman brothers stock in whatever its current format is. This person has lost money, even though he hasn't sold. Or a more practical example. Let's say you and I both buy ABC @ $10/share, and it goes down to $5...
by ddb
Tue Aug 16, 2016 1:34 pm
Forum: Personal Finance (Not Investing)
Topic: Looking for clarification on IRA Rollover One-Per-Year rule
Replies: 16
Views: 1615

Re: Looking for clarification on IRA Rollover One-Per-Year rule

ddb, If you read § 408(d)(3)(B) carefully, you will see that the 1-year limitation period for rollovers starts from the date of the original distribution. In your example, it was 7/1/2016. The subsection of this code says: "This paragraph does not apply to any amount described in subparagraph (A)(i) received by an individual from an individual retirement account or individual retirement annuity if at any time during the 1-year period ending on the day of such receipt such individual received any other amount described in that subparagraph from an individual retirement account or an individual retirement annuity which was not includible in his gross income because of the application of this paragraph." In other words, any distribu...
by ddb
Tue Aug 16, 2016 12:47 pm
Forum: Personal Finance (Not Investing)
Topic: Looking for clarification on IRA Rollover One-Per-Year rule
Replies: 16
Views: 1615

Re: Looking for clarification on IRA Rollover One-Per-Year rule

Artsdoctor wrote:The sums are very small so wouldn't it just be easier to rollover the accounts with trustee-to-trustee distribution? You'd gain very little, if anything, by having the checks sent to you and then having to settle up within 60 days There are no limits with trustee-to-trustee transfers and you don't have to worry about this.
In my example, this was money that was already distributed from an IRA, and the IRA owner wishes to rollover as much as possible, legally. Not that the reason matters (and I'm not the subject here), but let's say the person made the distributions for short-term emergency needs (real estate closing, home repair, health crisis, whatever), and now has come up with the money to be able to fund the rollover.
by ddb
Tue Aug 16, 2016 9:41 am
Forum: Personal Finance (Not Investing)
Topic: Looking for clarification on IRA Rollover One-Per-Year rule
Replies: 16
Views: 1615

Looking for clarification on IRA Rollover One-Per-Year rule

Hello: In 2014, IRS issued new guidance on IRA rollovers which said that the one-per-year rule applies to an individual's IRAs in aggregate, rather than on an account-by-account basis. Then there was some further clarification in November 2014. The original langugage surrounding the allowability and frequency of rollover contributions can be found in IRC Section 408, subsection (d) . I've read through each of the above sections, and it's still not clear to me if a rollover contribution is allowable on multiple distributions from the preceding 60 days. e.g. let's say an IRA owner makes the following distributions. 07/01/2016: $5,000 (60-day window ends 08/30/2016) 07/15/2016: $30,000 (60-day window ends 09/13/2016) 08/01/2016: $5,000 (60-day...
by ddb
Mon Feb 08, 2016 1:20 pm
Forum: Personal Investments
Topic: TIPS
Replies: 7
Views: 1097

Re: TIPS

raveon wrote:Are TIPS part of the Vanguard Total Bond Index?
No. You can view the fund's detailed holdings list on the most recent semi-annual report, dated 06/30/2015.
If not, does it make sense to have them as part of the bond allocation?
Many people think so. I believe that the added diversification probably gives some amount of benefit, but I also believe the benefit is so small that it doesn't matter either way.

- DDB
by ddb
Mon Jan 25, 2016 11:41 am
Forum: Personal Investments
Topic: Backdoor IRA?
Replies: 13
Views: 1344

Re: Backdoor IRA?

retiredjg wrote:Spouse will not be able to use the back door because of the SEP. If you (couple) wish to have more tax-deferral, the SEP is the account to use instead of Roth IRA or taxable.
Spouse could open Individual 401k which accepts incoming rollover from SEP IRA, thereby making the Roth conversion strategy on a non-deductible Traditional IRA contribution (the so-called Backdoor Roth (I hate that term)) more viable. As mentioned, OP could transfer his/her rollover IRA balance into his/her 401k if permitted, and if fund options are acceptable.
by ddb
Tue Dec 22, 2015 3:25 pm
Forum: Personal Investments
Topic: Business SEP, Still do Backdoor?
Replies: 8
Views: 689

Re: Business SEP, Still do Backdoor?

DSInvestor wrote:If you and your husband are employees of the same company and the company contributed to his SEP-IRA, it must also contribute to your SEP-IRA at the same contribution percentage.
Not necessarily. Minimum requirements for SEP eligibility are employees who are at least 21 years old and have performed services for the employer in at least 3 of the immediately preceding 5 years.
by ddb
Tue Dec 22, 2015 3:01 pm
Forum: Personal Investments
Topic: Business SEP, Still do Backdoor?
Replies: 8
Views: 689

Re: Business SEP, Still do Backdoor?

countrymouse wrote:Well, wait one more question. And maybe a dumb one.

The business created the account for my husband. I am not on that SEP IRA account.

So I personally do not have an IRA, of any form. However we file married/jointly. So could I still do it?
Yes, you can do it without any aggregation rule complications.
by ddb
Tue Dec 22, 2015 2:57 pm
Forum: Personal Investments
Topic: Business SEP, Still do Backdoor?
Replies: 8
Views: 689

Re: Business SEP, Still do Backdoor?

SEP IRAs count as part of your aggregated IRA, regardless of how they were funded. So yes, this impacts the taxability of your "backdoor" Roth conversion.
by ddb
Thu Sep 24, 2015 12:33 pm
Forum: Personal Consumer Issues
Topic: Netflix vs. Amazon Prime question - re wifi use
Replies: 10
Views: 1719

Re: Netflix vs. Amazon Prime question - re wifi use

An alternate method is to tether your mobile phone's data connection to your laptop/tablet for streaming movies while on the train. This only works if you have an unlimited data plan and the ability to tether your phone, though, which most people nowadays don't have.

Offline Netflix viewing, to me, would be a huge improvement for the Netflix experience for those of us who travel via plane frequently. I mostly use Google Play Movies for offline viewing, but this requires purchasing or renting movies through the Google Play store, rather than having access to a large number of movies continuously like with Netflix.
by ddb
Thu Aug 20, 2015 3:41 pm
Forum: Investing - Theory, News & General
Topic: anyone treating this as an RBD (really bad day)
Replies: 95
Views: 14592

Re: anyone treating this as an RBD (really bad day)

Toons wrote:I treat it as a Really Good Day-Share prices declining ,that is what long term investors want.
Accumulation of more shares for your money.
It is healthy for the market and investors :happy
Not all long-term investors are adding money to their portfolio.

Also, the notion that declining share prices is good for those who still add money to their portfolio is only valid if the ending stock index value is the same in either case. This has always struck me as a very faulty assumption!

- DDB
by ddb
Mon Jul 27, 2015 9:55 am
Forum: Personal Investments
Topic: What advice would you give...Salary bumping up from 37k to 45k annually
Replies: 15
Views: 2691

Re: What advice would you give...Salary bumping up from 37k to 45k annually

Conventional wisdom is to maintain your current lifestyle and act as if you never received a pay raise. Excess funds should go to various savings. In reality, and in my opinion, there's nothing wrong with using some of the pay increase towards lifestyle expenses that you find valuable. This may be vacation, car, new TV, whatever. Just don't go overboard. Assuming you are a single taxpayer with no dependents, a $45K gross salary translates into $34,700 after standard deduction and personal exemption, which places you within the 15% marginal federal income tax bracket. In my opinion, this generally warrants contributing money to retirement accounts of the Roth variety rather than the Traditional (tax-deductible) variety. Given that you're not...
by ddb
Thu Apr 30, 2015 1:55 pm
Forum: Personal Consumer Issues
Topic: How to store and organize videos on YouTube
Replies: 6
Views: 1573

Re: How to store and organize videos on YouTube

vitaflo wrote:Using a cloud service like Dropbox or Google Drive is a better bet. Or, just keep them on whatever else you're backing up your files to. Storage is cheap these days.
Agreed. 1TB of Google Drive storage is just $10 per month, and would give OP the folder directory structure that he wants.

Frankly, though, I'd also be comfortable using YouTube as a "backup" service, despite the potential limitations and risks.
by ddb
Mon Mar 23, 2015 9:35 am
Forum: Personal Investments
Topic: Dilemma re: taxable account
Replies: 18
Views: 2651

Re: Dilemma re: taxable account

I am retired so will need to be living off the money I have in my taxable account for the next four years. I have a years worth of funds put away for emergency purposes. When I spoke to a financial advisor he suggested I fully invest the remainder in stock mutual funds and sell them off as I need them to finance the next four years. He said he would rather see the money being used in this way than sitting in a CD or something of the like. I am not so sure about the wisdom of this. So my question is, do I follow the advisor's advice and invest this money in stock mutual funds (he has my bonds in the IRA portion of my portfolio), or do I take this money, which would represent about 8% of my total portfolio and do a CD ladder or some other in...
by ddb
Mon Mar 23, 2015 9:05 am
Forum: Personal Investments
Topic: FA needs investment advice
Replies: 25
Views: 4088

Re: FA needs investment advice

This doesn't address your question, but just wanted to throw out a recommendation to read some of the consulting books by Mark Tibergien and Philip Palaveev. Mark has great information on running an advisory firm in general, while Philip presents a very detailed case on building an ensemble practice. From a business management and income stability standpoint, as well as increasing growth potential, you may find a lot of value in exploring the option of merging with/selling to/buying out another firm (depending on your current actual scale). Tibergien popularized a very simple, but very useful, way of looking at your firm's income statement. In short, you want to look at it this way: Revenue 100% - Direct Expense DE% (target max of 40%) ----...
by ddb
Tue Mar 10, 2015 3:47 pm
Forum: Investing - Theory, News & General
Topic: If you could send an investment message 10 years in the past
Replies: 62
Views: 8147

Re: If you could send an investment message 10 years in the

"Consistent long slightly out-of-money call options on REGN, GMCR, PCLN, NFLX, AAPL for next 10 years. Cancel wedding."

Around 128 characters, massive impact. Would be insanely wealthy by year-end alone. Would avoid disastrous relationship which continues to this day.
by ddb
Mon Mar 09, 2015 3:03 pm
Forum: Personal Investments
Topic: should I start Traditional IRA?
Replies: 3
Views: 585

Re: should I start Traditional IRA?

We are confused as to start the traditional IRA or not? Since, I am going to jam the $5500 there for quite sometime.. on the other hand the return is significant.. we were in the same delima last year, and did not open the account.. I don't want to waste anymore time on this confusion.. Looking only at the initial income tax savings when making a deductible Traditional IRA contribution represents an incomplete analysis. Yes, you save tax now at a rate of around 31%, but remember that when you or your heirs make a withdrawal from this account, it will be taxed at your/their then-current marginal tax rate. The vast majority of people do have a lower marginal tax rate in retirement, but remember that the actual tax savings on the IRA needs to...
by ddb
Fri Mar 06, 2015 8:31 am
Forum: Personal Investments
Topic: S. Corp Salary Amount and Retirement Contributions
Replies: 53
Views: 10397

Re: S. Corp Salary Amount and Retirement Contributions

Ignoring the important issue of paying yourself an appropriate salary...

I would never choose to pay a 15.3% payroll tax so that I could contribute more money to a retirement plan. Would you add money to a retirement plan if there were a 15.3% sales load on any money you added? No, none of us would, even if it were the only option.

So, consider paying yourself a reasonable salary so as to stay in line with IRS guidance and to reduce the risk of raising red flags, contribute what you can to retirement accounts, and then save remaining funds in a taxable account.
by ddb
Fri Mar 06, 2015 8:26 am
Forum: Personal Finance (Not Investing)
Topic: Trying to get out of debt, now that my wife is onboard
Replies: 22
Views: 4059

Re: Trying to get out of debt, now that my wife is onboard

If I were you, I'd look into refinancing all debt into a single home equity line of credit with a 10-year payment schedule. Where I live, there is a credit union that offers a 10-year fixed-rate HELOC with a 4-year draw at a rate of 3.25% for up to the greater of 80% LTV or $200K. The product has no closing costs, but the state adds a tax of about 1% onto the loan amount, so you'd need to borrow around $192K. The monthly P&I would be around $1,900. This fully removes the risk of rising rates from your debt situation. It also makes you debt-free in 10 years (or less, if you do some pre-paying).

They key aspect to consolidating debt, though, is to not take on any more debt after the consolidation.
by ddb
Fri Mar 06, 2015 8:18 am
Forum: Personal Finance (Not Investing)
Topic: Does My Daughter Need A Prenup?
Replies: 175
Views: 15497

Re: Does My Daughter Need A Prenup?

According to BLS , 29.7% of those with a bachelor's degree or higher who were married for the first time prior to age 46 ended up getting divorced by age 46. So, you may be being a bit pessimistic with respect to your daughter's likelihood of divorce. Nevertheless, I think awareness of risk is almost always a good thing, and I think it would be fine for you to bring this up with your daughter in a non-confrontational way. The inheritances aren't really a big deal, as long as she is aware that inherited assets ARE NOT marital assets as long as they are kept out of the spouse's name. Her main risk is having to pay spousal support in the event of a divorce if he were to fight for that. (keep in mind I am not an attorney, and this should not b...
by ddb
Thu Mar 05, 2015 2:25 pm
Forum: Investing - Theory, News & General
Topic: 3 Costs Investors Must Control
Replies: 61
Views: 8666

Re: 3 Costs Investors Must Control

livesoft wrote:The Dalbar studies have been disputed. Even the link you cited has the caveat "if accurate."

See also: http://www.bogleheads.org/forum/viewtopic.php?t=70723

But give us something more than Dalbar, please.
Vanguard has given us a bit of a guide on this topic. It's is hardly scientific, and it assumes that the advisor-in-question is purchasing low-cost funds in a buy-hold-rebalance format. In this case, it DOES appear that such an advisor would outperform the average DIY investor by ~3% per year before the advisor fee is taken into consideration. Of course, this is not surprising to any of us here. It also ignores the notion that most advisors are NOT managing money in this way!
by ddb
Thu Jan 15, 2015 10:28 am
Forum: Personal Investments
Topic: IRA instead of Owing Taxes, or Other Option?
Replies: 3
Views: 750

Re: IRA instead of Owing Taxes, or Other Option?

The fact that some of your 2014 taxable income is being taxed at the 25% marginal rate means that your taxable income is at least $73,800 (assuming married-filing-jointly). This also means that your adjusted gross income is at least $73,800 plus $12,400 standard deduction plus 2 * $3,950 personal exemptions = $90,150. Per IRS , your ability to deduct a Traditional IRA contribution for 2014 phases out for Modified AGI between $96,000 and $116,000. So, to answer your question: 1. I'm generally in favor of making tax-deductible retirement plan contributions for marginal tax rates of 25% or higher, assuming there is no better use for the money. However, I think paying down a 6.8% interest rate student loan qualifies as a better use for the mone...
by ddb
Mon Dec 22, 2014 2:00 pm
Forum: Personal Investments
Topic: How to make a long bet on Crude Oil
Replies: 28
Views: 5307

Re: How to make a long bet on Crude Oil

Your troubles are over.

Image

(and if you want to actually read the nonsense)

- DDB
by ddb
Tue Dec 09, 2014 10:31 am
Forum: Personal Consumer Issues
Topic: [What UN-frugal thing do you do? What do you splurge on?]
Replies: 785
Views: 82846

Re: What do you splurge on?

Red wine, bourbon, Android mobile devices. Also, my car certainly cost me more than a car that provided basic needs, but I wouldn't have it any other way.
by ddb
Mon Nov 03, 2014 8:26 am
Forum: Personal Investments
Topic: Should I refi with MAX cashout????
Replies: 9
Views: 1409

Re: Should I refi with MAX cashout????

I am in the middle of a refinance and have been pondering taking cash out to invest in our retirement accounts. Its a very small refi (92k) from a 10 yr mortgage at 2.99 with 9 years remaining to a 30 year fixed at 3.625. My plan is to take the difference in monthly payment and put it towards tax sheltered accounts as we can not fill these up currently given our income. Our current mortgage payment on our ten year note is 965 and it would drop to 425. This doesn't sound like a good idea. Consider continuing to make your minimum mortgage payments on the existing loan, and then put away as much as possible for retirement after that. Along the way, bump up your retirement savings any time you get a raise. 9 years from now when your mortgage i...
by ddb
Fri Oct 31, 2014 1:56 pm
Forum: Investing - Theory, News & General
Topic: What are you up YTD? [Year To Date]
Replies: 5249
Views: 899892

Re: What are you up YTD?

75/25 portfolio (with 30% small-cap tilt & 40% intl'), XIRR for 2014 as of Oct 30th's closing price: 7.79% (annualized). I was lucky in that I rebalanced into equities on Oct 16th, just as things were starting to turn around. Accidentally near-perfect market timing :mrgreen: These figures are difficult for me to accept when looking at the year-to-date total returns of major market indices year-to-date through 10/30/2014: MSCI US Broad Market: +8.66% S&P SmallCap 600 Pure Value: -0.45% MSCI EAFE: -3.87% MSCI Emerging Mkts: 2.76% MSCI EAFE SmallCap: -5.41% Bloomberg Commodity Total Return: -6.18% Barclays US Corporate 1-5 Year: +2.25% Barclays US Corporate 5-10 Year: +7.01% Barclays US TIPS: +4.68% Barclays US High Yield Bond: +4.60%...
by ddb
Fri Oct 24, 2014 11:15 am
Forum: Personal Finance (Not Investing)
Topic: IS this car lease too good to be true?
Replies: 13
Views: 3370

Re: IS this car lease too good to be true?

bloom2708 wrote:Leasing has another aspect if you've never done it.

I felt like I was driving a rental and was watching miles. A small scratch or a door ding can have more impact that if it was "yours".

I know some love leasing. Just keep in mind the mental aspects beyond the costs.
The other side to this is that I don't particularly care how I treat the car if it's a lease, since I plan to give it back before any major problems pop up. High revs during a cold start? Sure! Fall behind on the maintenance schedule? No problem!

- DDB
by ddb
Thu Sep 04, 2014 8:59 am
Forum: Investing - Theory, News & General
Topic: John Hussman, smart guy, should you listen to his forecasts
Replies: 76
Views: 13248

Re: John Hussman, smart guy, should you listen to his foreca

beardsworth wrote:Just a note that this is Larry's second Hussman tear-down on the Bogleheads forum in the past three months, and IMO essentially a recycling of the first:

http://www.bogleheads.org/forum/viewtop ... 0&t=138707
Certain members here seem to be exempt from the "no website traffic solicitation" rule from the board's Policies & Etiquette page.

- DDB
by ddb
Thu Sep 04, 2014 8:56 am
Forum: Personal Finance (Not Investing)
Topic: Variable Annuity - Timing of Surrender Charges
Replies: 10
Views: 1306

Re: Variable Annuity - Timing of Surrender Charges

Balanthalus wrote:Thank you for your responses. So far I have only seen the general publicly available plan documents, not their particular annuity contract, and wanted know what was standard (if there is such a thing for these products) before diving into them.
What is the company name and contract name? If you provide those, I can almost certainly give you reliable surrender charge information.

FWIW, the "cheapest" way to get out of a deferred variable annuity is often to just pay the surrender charge now, because waiting will involve paying the very high ongoing internal costs.

- DDB
by ddb
Tue Sep 02, 2014 7:57 am
Forum: Personal Finance (Not Investing)
Topic: Variable Annuity - Timing of Surrender Charges
Replies: 10
Views: 1306

Re: Variable Annuity - Timing of Surrender Charges

dickenjb wrote:Why are surrender charges relevant? They can't take money out until they terminate employment anyway.
In the 403b world, can transfer funds to another investment provider sanctioned by the employer, even if employee is under 59.5 and still working for the employer.

- DDB
by ddb
Thu Aug 07, 2014 3:22 pm
Forum: Investing - Theory, News & General
Topic: Volatility: Oh how I love thee.
Replies: 44
Views: 5601

Re: Volatility: Oh how I love thee.

Yeah, that was sort-of a confusing use of words. Better to say that I'll be rebalancing in a lower prices. :wink: Rick The ability to buy stocks when prices are down can happen under 3 basic scenarios: 1. Investor has cash on sidelines ready to buy stocks at certain valuation levels. 2. Investor is willing to increase target equity allocation, in which he sells off existing cash or bond holdings in order to increase equity holdings above target levels. 3. Investor rebalances to target allocation, which will necessarily mean buying more stocks because stock prices are down. Both (1) and (2) violate the conventional Boglehead wisdom to develop a target asset allocation and stick with it over time. So let's ignore those two, and focus on scen...
by ddb
Thu Jul 31, 2014 1:18 pm
Forum: Investing - Theory, News & General
Topic: Dave Ramsey still defending 12% and still angry at "nerds"
Replies: 194
Views: 37186

Re: Dave Ramsey still defending 12% and still angry at "nerd

Wow, Dave managed to be offensive to a number of different groups of people in just 9 minutes!

I do agree with his bigger point, though, that one's financial success is most impacted by good habits, i.e. live below your means and save the rest.

- DDB
by ddb
Thu Jul 31, 2014 1:10 pm
Forum: Investing - Theory, News & General
Topic: International investing. A good call by our mentor.
Replies: 150
Views: 23183

Re: International investing. A good call by our mentor.

Twins Fan wrote:That's a nice rant, baw. But, I think you missed the point of the thread.

To me, the point was that Mr. Bogle made a call 15 years ago and it was correct. Maybe some can see what will happen?

If you want to call that cherry picking though...
John Bogle didn't make a call 15 years ago regarding the future performance of US vs. non-US stocks. He made a recommendation to limit non-US stock holdings to a maximum of 20% of one's equity portfolio.

The data I posted above showed that a buy-hold-rebalance investor over the last 15 years would have earned approximately the same performance whether he had 0%, 20%, or 50% in foreign stocks, i.e. it didn't really matter. This neither supports nor refutes Bogle's advice.

- DDB
by ddb
Thu Jul 31, 2014 11:44 am
Forum: Investing - Theory, News & General
Topic: International investing. A good call by our mentor.
Replies: 150
Views: 23183

Re: International investing. A good call by our mentor.

A few points worth mentioning here: 1. Basing an investment strategy on a recent 15-year period of returns is probably a bad idea. Else, we should all invest entirely in long-term government bonds and small-cap value stocks. 2. Looking at annualized returns of each component is not particularly helpful, as we should be more interested in how adding a new asset class (in this case, foreign stocks) affects the overall risk and return characteristics of the entire portfolio. In this simple 2-asset class universe, we have the following annualized returns and standard deviations in annual returns for the 15-year period of 1999-2013: http://i.imgur.com/rq3Qy2Z.jpg By going from 100% US stocks to 50% US stocks, you would have lost ~0.06% in annual...
by ddb
Tue Apr 29, 2014 8:25 am
Forum: Personal Consumer Issues
Topic: Compact SUV as family car for the long term
Replies: 15
Views: 4392

Re: Compact SUV as family car for the long term

Two kids (6, 5), we find that our Mazda CX-5 (compact SUV) and Subaru WRX STi (small hatchback) both have plenty of interior room and cargo space for our needs as a family of four. With the carseats, though, carrying a fifth passenger is basically not an option. This occasionally causes some limitations on our ideal plans. The other issue for us had to do with the rear-facing infant carriers - these typically jut out pretty far from the rear seat, and can possibly create legroom issues for taller front-seat passengers. I'm 71" tall, and with an infant carrier behind my seat, I'm just barely okay to drive. Prior to the Subaru, I had a Mazda3 hatchback, and we did lots of weekend road trips, and never had the need for more cargo space. H...
by ddb
Mon Apr 28, 2014 1:14 pm
Forum: Personal Finance (Not Investing)
Topic: Comparing W2 to 1099 job
Replies: 10
Views: 4080

Re: Comparing W2 to 1099 job

I'm working as both an employee (W2) and independent contractor (1099). I'm trying to determine which job has a higher hourly rate. I already max out my retirement and benefits through my employed (W2) position. I plan on keeping both jobs for now. Job #1: Employee, $225/hr Job #2: Independent contractor, $250/hr My questions: 1) Which has a higher net hourly? (Taking into account FICA, medicare taxes) 2) If I max out the social security taxable earnings ($117k) with the W2 job, do I still need to pay the full Self-employment tax (15.3%)? In other words, is the maximum per EMPLOYEE, or per JOB? Thanks! You may find it very helpful to prepare a sample income tax return based on the above. Assumptions: 1. 1,000 hours W-2 ($225,000 salary), 1...
by ddb
Mon Apr 28, 2014 8:18 am
Forum: Investing - Theory, News & General
Topic: Newer paper(s) akin to Carhart's 1997 "On Persistence..."
Replies: 3
Views: 1711

Re: Newer paper(s) akin to Carhart's 1997 "On Persistence...

larryswedroe wrote: 1. Bradford Cornell, “Luck, Skill and Investment Performance.” The Journal of Portfolio Management (Winter 2009).
2. Eugene F. Fama and Kenneth R. French, “Luck versus Skill in the Cross Section of Mutual Fund Alpha Estimates,” June 2009.
Thanks, Larry, these are exactly what I was looking for. Both of these papers should decimate any desire one has to buy an actively-managed fund!

- DDB
by ddb
Mon Apr 28, 2014 8:03 am
Forum: Investing - Theory, News & General
Topic: Most reliable way to double a portfolio in 12 years
Replies: 55
Views: 18204

Re: Most realiable way to double a portfolio in 12 years

If you wanted to double the size of a portfolio in 12 years how would you invest the money. If it goes over that's fine but not necesssary. The goal is to fine the most likely and least risky investment option to achieve this goal. To double a portfolio size in 12 years on a nominal basis, without considering taxes, and assuming no deposits or withdrawals, will require a compound annual growth rate of 5.95%. Excel formula is [=(starting value / ending value)^(1/number of years)-1], or in this case, [=(2/1)^(1/12)-1]. Remember, this is a compound, or geometric, average rate of return. The simple, or arithmetic, rate of return will vary depending on the volatility of annual returns. The greater the volatility, the higher the arithmetic avera...
by ddb
Mon Apr 28, 2014 7:45 am
Forum: Investing - Theory, News & General
Topic: Newer paper(s) akin to Carhart's 1997 "On Persistence..."
Replies: 3
Views: 1711

Newer paper(s) akin to Carhart's 1997 "On Persistence..."

Hi All:

Are there any more recent academic papers which look at persistence (or lack thereof) in mutual fund performance? Carhart's 1997 masterpiece did a great job tackling this subject, but at this point the data set he used is 21 years outdated (he looked at January 1962 through December 1993).

Thanks!
DDB
by ddb
Thu Mar 20, 2014 11:26 am
Forum: Personal Finance (Not Investing)
Topic: Friend possibly victim of real estate dual agency
Replies: 27
Views: 4254

Re: Friend possibly victim of real estate dual agency

denovo wrote:
ddb wrote:
CrossOverGuy wrote:Any feedback? Thanks.
I am not aware that real estate agents are required to act in the best interest of their clients.

Based on the limited info provided, doesn't sound to me like there's much here to "go after".

- DDB
Whether or not it was met here is an open, question but traditionally RE agents have a fiduciary duty.
News to me, and some quick searching verifies your point. Thanks for the enlightenment!
by ddb
Thu Mar 20, 2014 9:10 am
Forum: Personal Finance (Not Investing)
Topic: Friend possibly victim of real estate dual agency
Replies: 27
Views: 4254

Re: Friend possibly victim of real estate dual agency

CrossOverGuy wrote:Any feedback? Thanks.
I am not aware that real estate agents are required to act in the best interest of their clients.

Based on the limited info provided, doesn't sound to me like there's much here to "go after".

- DDB
by ddb
Thu Mar 20, 2014 8:12 am
Forum: Personal Consumer Issues
Topic: Buy a used car or pay $5,000 more to get a new one?
Replies: 62
Views: 7554

Re: Buy a used car or pay $5,000 more to get a new one?

chald wrote:I thought about just going for a new Crosstrek but decided that it didn't make sense to buy something I don't need just because I want it.
We're not all living on rice/beans/water while living in an efficiency apartment and walking to work, which means that most of us are buying things we don't need just because we want it. If you believe that the Crosstrek will bring you more than $4K of additional "utility" during the ownership period of the car, you might want to think again about splurging a bit.

BTW, big Subaru fan here. Finally pulled the plug recently on my "dream-car-within-reason", a WRX STi.

- DDB
by ddb
Wed Mar 19, 2014 2:47 pm
Forum: Personal Consumer Issues
Topic: Professions that have the most/least psychopaths
Replies: 30
Views: 3081

Re: Professions that have the most/least psychopaths

frugaltype wrote:I'm surprised to see clergymen in there. On the other hand, there seems to be a great divide in that profession, some being totally unempathic and extremely nasty and others being perhaps the best people ever.
This profession was the one I most expected to see on the list.
by ddb
Wed Mar 19, 2014 12:36 pm
Forum: Investing - Theory, News & General
Topic: An 8% SWR ???
Replies: 12
Views: 2759

Re: An 8% SWR ???

Money Magazine has an article citing an author proposing that one save 12 times one's pre-retirement income by age 65 for retirement: http://money.cnn.com/2014/03/03/retirement/retirement-savings.moneymag/index.html The article later suggests that amount may be reduced by 10% to 25% by ramping up pre-retirement savings or working a few more years. :confused A goal of saving 12 times one's pre-retirement income doesn't necessarily imply an 8% expected withdrawal rate. Simple example: worker earns $50K per year via W-2 income. Of this, $3,825 goes to FICA, $7,500 to 401k, $4,433 to federal income tax, and $1,000 to state income tax. His take-home income is therefore $33,242. This man targets 65 as a retirement age and wants to maintain his c...
by ddb
Wed Mar 19, 2014 12:24 pm
Forum: Personal Consumer Issues
Topic: Best smartphone in 2014?
Replies: 38
Views: 5893

Re: Best smartphone in 2014?

InvestorNewb wrote:I need a new phone... my old one (now ancient) broke after 4 years of use.

I use the internet a lot and I also want one with the best camera for photos/video.

Any suggestions?
Depends on a lot of information not provided. I'm a bigtime Android fanboy, however I think the typical smartphone user who wants basic functionality (web/email) and a best camera would do well to check out the Windows Phone 8 OS on a Nokia Lumia device. These are very user-friendly, smooth, and can't find a better camera on another mobile device.

- DDB