Search found 4753 matches

by Peter Foley
Fri Feb 15, 2019 12:04 am
Forum: Personal Finance (Not Investing)
Topic: Reaching ROTH Ira limits
Replies: 9
Views: 935

Re: Reaching ROTH Ira limits

From thebalance link referenced above:

"There is one item you don't need to add to your AGI: contributions to employer-sponsored plans, like 401(k)s."

As the 2018 Roth phase out begins at a MAGI of $189,000, you should be okay.
by Peter Foley
Thu Feb 14, 2019 6:11 pm
Forum: Personal Investments
Topic: Help with 403b/457b
Replies: 8
Views: 444

Re: Help with 403b/457b

I agree with mariezzz regarding non governmental 457s. Many who have access to both are in academia or work for medical non profits. That is not the entire pool of those who have dual access, just a couple examples of where multiple options exist. The 457b has the option of early withdrawal w/o pena...
by Peter Foley
Wed Feb 13, 2019 4:41 pm
Forum: Personal Investments
Topic: Taxable account questions
Replies: 11
Views: 1430

Re: Taxable account questions

I would be inclined to stop contributing to the index 500 fund in taxable and switch to total stock market. It is not a disadvantage to hold both. It may provide an opportunity for tax loss harvesting if one of the two is below water after a market downturn. (Living Free pointed this out as well.) I...
by Peter Foley
Tue Feb 12, 2019 11:41 pm
Forum: Personal Finance (Not Investing)
Topic: Rule of 55 is it official?
Replies: 62
Views: 14603

Re: Rule of 55 is it official?

voidstar wrote: I'm guestimating her 401K could balloon to maybe ~$400K,with max contributions made for the next 10 years. Note a huge amount for retirement by itself -- but she could "float" with that income between age 55 and 59.5 -- at which point, then at age 59.5, she could pull from her RothIR...
by Peter Foley
Tue Feb 12, 2019 6:29 pm
Forum: Personal Investments
Topic: Simpler Rebalance
Replies: 4
Views: 443

Re: Simpler Rebalance

For your wife I would go with the Wellington suggestions too.

Certainly move the Edward Jones. I would also sell of some of the individual stocks you hold in retirement accounts.
by Peter Foley
Tue Feb 12, 2019 5:27 pm
Forum: Investing - Theory, News & General
Topic: How much Fixed Income on the day you retire?
Replies: 76
Views: 5050

Re: How much Fixed Income on the day you retire?

We held two years worth of cash when we retired. It lasted almost 3 years. We went to 45/55 about a year before we retired. (At 45/55 we had the ability to not touch stocks until well after we qualified for maximum SS benefits.) We retired in 2012 and I was a little worried about a double dip recess...
by Peter Foley
Tue Feb 12, 2019 5:07 pm
Forum: Personal Investments
Topic: Advice on bridge to SS, asset mix, etc
Replies: 15
Views: 1047

Re: Advice on bridge to SS, asset mix, etc

Wizard

I'm about a year behind you in age and also retired 7 years ago. Our retirement date timing was excellent (in retrospect)!

Starting SS Benefits at full retirement age was also my back up plan.
by Peter Foley
Tue Feb 12, 2019 5:02 pm
Forum: Personal Investments
Topic: Retirement Account Fund Choices
Replies: 5
Views: 277

Re: Retirement Account Fund Choices

I'm okay with bloom2708's recommendation. I'm not a huge fan of international so I would make that only 15% to 20% of stocks.
by Peter Foley
Tue Feb 12, 2019 4:56 pm
Forum: Personal Investments
Topic: Advice on bridge to SS, asset mix, etc
Replies: 15
Views: 1047

Re: Advice on bridge to SS, asset mix, etc

Again welcome. Just a few things, not a complete analysis: 1. 60% stock and 40% bonds is fine. Some people prefer to be at 50/50 when they enter retirement and then let things drift back up to 60/40. This is called a rising equity glide path and it guards against a poor sequence of returns. (See Wad...
by Peter Foley
Tue Feb 12, 2019 4:31 pm
Forum: Personal Finance (Not Investing)
Topic: IRA distributions - Where listed in federal tax forms?
Replies: 6
Views: 376

Re: IRA distributions - Where listed in federal tax forms?

I use Turbo tax and it did not generate an entry on Schedule D for an IRA distribution. An IRA distribution is not a capital gain or loss, it is ordinary income. There only entry is on 8606 with totals carried forward to the 1040.
by Peter Foley
Tue Feb 12, 2019 12:04 am
Forum: Personal Investments
Topic: Investing in gold
Replies: 33
Views: 2031

Re: Investing in gold

While I do not favor it myself, there are some who do for diversification purposes. If you are inclined to go this route read about Harry Browne's Permanent Portfolio.
by Peter Foley
Mon Feb 11, 2019 8:20 pm
Forum: Personal Investments
Topic: Trying to balance simplicity with tax-efficiency
Replies: 7
Views: 652

Re: Trying to balance simplicity with tax-efficiency

You wrote and duckie replied: Recently I got fed up with this and decided to just throw everything into the 2040 Target Retirement fund across all of our accounts. Now I'm sorta wondering if that was a mistake. duckie: It was. You don't want a target-date fund in your taxable account because of the ...
by Peter Foley
Mon Feb 11, 2019 4:21 pm
Forum: Personal Investments
Topic: 457 vs Roth IRA
Replies: 7
Views: 302

Re: 457 vs Roth IRA

I would vote for mostly 457b. You will likely retire early and will be able to create a number of low tax years when you will be able to draw down a tax deferred account at a lower tax rate than you have right now. Do track the ratio of traditional 457b to Roth 457b. You do not want too much in tax ...
by Peter Foley
Mon Feb 11, 2019 11:31 am
Forum: Personal Investments
Topic: simplifying my portfolio
Replies: 6
Views: 905

Re: simplifying my portfolio

When restructuring a portfolio you also will want to look at the tax consequences if the various funds are in a taxable account. Selling losers to offset winners helps. It is sometime necessary to hold winners for a one year minimum to receive favorable tax treatment. What I am trying to point out i...
by Peter Foley
Sun Feb 10, 2019 8:49 pm
Forum: Personal Investments
Topic: Is this just too simple
Replies: 41
Views: 6069

Re: Is this just too simple

I would be in favor of simplifying greatly if it did not cost you a fortune in taxes. You can create a 3-4 fund portfolio at Schwab if that helps with tax considerations. Schwab Total Stock Market, Schwab 1000, and the Schwab 500 index are all low cost diversified funds and they all track fairly clo...
by Peter Foley
Sun Feb 10, 2019 8:42 pm
Forum: Personal Finance (Not Investing)
Topic: "Qutting" Job soon: Some questions (unemployment, health insurance)
Replies: 5
Views: 964

Re: "Qutting" Job soon: Some questions (unemployment, health insurance)

I agree with Iridium. You MAY qualify for unemployment benefits. I worked in the UI Program for a number of years. "Separation" laws vary a bit from state to state and even with the state statutes controlling there is room for judgement in many states. If the adjudicator feels this was a substantial...
by Peter Foley
Sun Feb 10, 2019 8:33 pm
Forum: Personal Investments
Topic: Parting ways with my broker. What next?
Replies: 2
Views: 524

Re: Parting ways with my broker. What next?

If you want to do a back door Roth I would make the transfer to the existing 401k. .45% is not great, but it isn't horrible either. You might check and see if it has a stable value fund that pays the rate of inflation or better. That is an alternative to bond funds that you could use for part of you...
by Peter Foley
Sun Feb 10, 2019 8:24 pm
Forum: Personal Investments
Topic: 403 B Question
Replies: 10
Views: 832

Re: 403 B Question

If you qualify, using an IRA rather than a 403b is not a bad option. You cannot defer as much but you can choose low cost index funds.

I would hold bond in the 403b (or IRA if you go that route). Leave the Roth invested in stocks.
by Peter Foley
Sat Feb 09, 2019 11:33 pm
Forum: US Chapters
Topic: Minnesota BH Main Meeting 1/26/19
Replies: 12
Views: 1163

Re: Minnesota BH Main Meeting 1/26/19

The east side group is usually 10 - 12 people and the west side group is usually about 20. I've been participating in these meetings since 2008 and I personally have never heard people talk about how much money they have. Portfolios are shared/discussed in terms of percentages, not dollars. There ar...
by Peter Foley
Sat Feb 09, 2019 7:51 pm
Forum: Investing - Theory, News & General
Topic: Tax efficiencies of combination of funds
Replies: 6
Views: 681

Re: Tax efficiencies of combination of funds

The ratios of US to international might come into play here. If you hold 80% US and 20% international you get one ratio, if you hold 50/50 you get another.
by Peter Foley
Sat Feb 09, 2019 5:17 pm
Forum: Personal Investments
Topic: Need further advice (Roth, 403b, 457b)
Replies: 12
Views: 556

Re: Need further advice (Roth, 403b, 457b)

With the combination of 403b options and 457b options I thought you might be in academia. :happy You are single which would leave me inclined to use a tax deferred 457b for at least some of your income, especially income above the 12% tax bracket. After that contribute to a Roth403b if possible. By ...
by Peter Foley
Sat Feb 09, 2019 5:07 pm
Forum: Personal Finance (Not Investing)
Topic: tax strategy for minimizing Social Security taxes in returement
Replies: 12
Views: 1005

Re: tax strategy for minimizing Social Security taxes in returement

dodecahedron wrote: Based on your OP, it looks like she is taking out IRA distributions in excess of her RMD and in excess of her actual spending needs and parking them in a taxable savings account. Why not use Roth conversion to park those excess distributions in a Roth IRA instead of putting them ...
by Peter Foley
Fri Feb 08, 2019 8:41 pm
Forum: Personal Finance (Not Investing)
Topic: 4% rule [Withdrawal rate - pretax or post-tax?]
Replies: 8
Views: 660

Re: 4% rule [Withdrawal rate - pretax or post-tax?]

If you look at the 4% guideline more as a savings indicator than a withdrawal strategy it would be prudent to take taxes into consideration. This would be especially important if a very high percentage of your retirement savings were in tax deferred accounts. As pointed out by 2015, it is unlikely t...
by Peter Foley
Fri Feb 08, 2019 12:53 pm
Forum: Personal Investments
Topic: Newbie with retirement withdrawal question
Replies: 28
Views: 2347

Re: Newbie with retirement withdrawal question

BL wrote: Since you have 5 years of "emergency funds" it makes sense to me to use that money to avoid selling your funds at least until you have LTCGs (one year from purchase). I agree. While BH typically advises having an emergency fund, this advice does not usually come with any age based or famil...
by Peter Foley
Fri Feb 08, 2019 11:07 am
Forum: US Chapters
Topic: Minnesota BH Main Meeting 1/26/19
Replies: 12
Views: 1163

Re: Minnesota BH Main Meeting 1/26/19

Contact us at the following e-mail address and ask that your e-mail be added to our list. mnbogleheads@gmail.com SPRING MAIN MEETING: Mark your calendars! Our next main meeting is Saturday April 20, 2019 from 9:30a to 11:30a at Ridgedale Library. In the interim, don't forget to read up on current fi...
by Peter Foley
Fri Feb 08, 2019 11:00 am
Forum: Investing - Theory, News & General
Topic: To What Degree Does Money Buy Happiness?
Replies: 107
Views: 4856

Re: To What Degree Does Money Buy Happiness?

Malow's hierarchy of needs certainly sheds some light on the topic. The following is from an early draft of the Boglehead's Guide to Retirement Planning: Recent surveys and studies on money and happiness confirm that money cannot buy happiness. Jean Chatzky reports in her book “You Don’t Have to be ...
by Peter Foley
Thu Feb 07, 2019 9:04 pm
Forum: Personal Investments
Topic: question on an inherited IRA
Replies: 24
Views: 1432

Re: question on an inherited IRA

Yes pulling works better than pushing. Have Schwab initiate the transfer.
by Peter Foley
Thu Feb 07, 2019 4:15 pm
Forum: Personal Investments
Topic: Tax avoidance help needed.
Replies: 18
Views: 2029

Re: Tax avoidance help needed.

See the wiki topic taxation of SS benefits. From the wiki: Single taxpayers: If you are single and receive $20,000 in Social Security benefits: None of your benefits are taxable if your other income is less than $15,000. For every dollar between $15,000 and $24,000, an additional 50 cents becomes ta...
by Peter Foley
Wed Feb 06, 2019 8:47 pm
Forum: Personal Investments
Topic: I could probably use some help
Replies: 6
Views: 696

Re: I could probably use some help

You can get most of what you need here. You do, however, need a plan of some sort. IMHO a plan starts with the ability to live below one's means. After that you can look into risk assessment, asset allocation, and investing in general. There are a number of good books on the Suggested Reading list. ...
by Peter Foley
Wed Feb 06, 2019 4:49 pm
Forum: Personal Investments
Topic: Inherited ROTH IRA, Taxes, & 5 year rule
Replies: 11
Views: 536

Re: Inherited ROTH IRA, Taxes, & 5 year rule

Before doing the conversion I would check to see if the younger beneficiaries are in a low tax bracket. If this is being left to grandchildren they can make a stretch IRA and probably pay little in taxes.
by Peter Foley
Wed Feb 06, 2019 4:44 pm
Forum: Personal Investments
Topic: What to do with Roth "profits"?
Replies: 8
Views: 914

Re: What to do with Roth "profits"?

I would have no problem holding some Roth money in a high yield MM funds for 2-3 years. Something may happen in the meantime that would move you to use these funds instead of other funds.
by Peter Foley
Wed Feb 06, 2019 3:30 pm
Forum: Personal Finance (Not Investing)
Topic: Family finance benchmarking/feedback
Replies: 24
Views: 1809

Re: Family finance benchmarking/feedback

Just in case you are interested, here is the MN Bogleheads e-mail address: mnbogleheads@gmail.com The following is a report back from our last meeting: Hello, fellow MN Bogleheads! We hope that you all survived the Polar Vortex and are enjoying the fresh snow (and prepared for more that is coming). ...
by Peter Foley
Tue Feb 05, 2019 11:43 pm
Forum: Personal Investments
Topic: Just about retirement age...am I on the right track?
Replies: 15
Views: 2321

Re: Just about retirement age...am I on the right track?

Good suggestions by David Jay.

You also might want to look at Mike Piper's Social Security calculator. It provides insight into when one should apply for SS benefits.

Website: https://opensocialsecurity.com/
by Peter Foley
Tue Feb 05, 2019 11:35 pm
Forum: Personal Investments
Topic: Seeking advice for retiree
Replies: 11
Views: 1313

Re: Seeking advice for retiree

I agree that she should hold some funds in reserve.

What is her interest rate on the mortgage? Is she able to itemize deductions in 2018 and beyond?
by Peter Foley
Tue Feb 05, 2019 6:12 pm
Forum: Personal Investments
Topic: One or Two 401K per family
Replies: 11
Views: 966

Re: One or Two 401K per family

Your question partially depends on your marginal tax rate. It is great to have a mix of tax deferred and Roth and that is what you have. However, if you are in a higher tax bracket it might be better for you to have a 401k and a regular IRA (if you qualify for a regular IRA).
by Peter Foley
Tue Feb 05, 2019 6:05 pm
Forum: Personal Investments
Topic: Just about retirement age...am I on the right track?
Replies: 15
Views: 2321

Re: Just about retirement age...am I on the right track?

Again welcome. You have done well with saving and are in an excellent position to transition into retirement. I like your asset allocation, savings mix, and cash set aside. The only thing I would suggest is that once you both go part time and your marginal tax rate drops is to do some Roth conversio...
by Peter Foley
Tue Feb 05, 2019 3:58 pm
Forum: Personal Finance (Not Investing)
Topic: Best way to leave money to a grandchild
Replies: 37
Views: 3715

Re: Best way to leave money to a grandchild

hoops777 wrote: Here is where it might get a little bit tricky.I have no children of my own and he is my step grandson and we are very close.I have also earned most of the money we have saved.I believe she will be ok with it as I have mentioned we can use my Roth to help pay for college to no object...
by Peter Foley
Mon Feb 04, 2019 8:52 pm
Forum: Personal Finance (Not Investing)
Topic: When to withdraw from these accounts after retirement?
Replies: 11
Views: 1202

Re: When to withdraw from these accounts after retirement?

With access to a 457b I don't know why you would pull from a Roth when you are likely to be in a low tax bracket? Pull from the Roth once you start SS benefits. If you meet the requirements for a penalty free withdrawal from the 401k, I would do that first with the 457b second. Otherwise reverse the...
by Peter Foley
Mon Feb 04, 2019 8:43 pm
Forum: Personal Finance (Not Investing)
Topic: Best way to leave money to a grandchild
Replies: 37
Views: 3715

Re: Best way to leave money to a grandchild

Given that you have two purposes for the Roth, one is to hold in case of emergency and the other is to fund a grandchild's education if not needed for an emergency, isn't a QTIP trust (surviving spouse as life beneficiary of the trust and grandson as final beneficiary) a viable option? Is not anothe...
by Peter Foley
Mon Feb 04, 2019 5:20 pm
Forum: Personal Investments
Topic: Newbie with retirement withdrawal question
Replies: 28
Views: 2347

Re: Newbie with retirement withdrawal question

One thing I would consider if you are approaching withdrawals is to turn off any dividend and capital gains reinvestment. Once it is all long term the tax rate will be zero or 15%. If you can stall off selling for a year that would be worthwhile.
by Peter Foley
Mon Feb 04, 2019 5:15 pm
Forum: Personal Finance (Not Investing)
Topic: Family finance benchmarking/feedback
Replies: 24
Views: 1809

Re: Family finance benchmarking/feedback

Welcome! And soon welcome to Minnesota. You will likely get a fair amount of advice regarding housing in the Twin Cities Metro area. We live in St. Paul and my daughter and family live in Minneapolis. A 3-4 bedroom house at a reasonable price is hard to find in Minneapolis proper. Schools are also a...
by Peter Foley
Mon Feb 04, 2019 5:04 pm
Forum: Personal Investments
Topic: What is the appropriate bond allocation?
Replies: 12
Views: 866

Re: What is the appropriate bond allocation?

At your age, 20% bonds is a pretty mainstream approach. I would be inclined to stay and that level just so you have some funds to rebalance should the market drop. We are long in the tooth in terms of the bull market. The most aggressive approach I personally would consider taking is your suggestion...
by Peter Foley
Mon Feb 04, 2019 4:57 pm
Forum: Personal Consumer Issues
Topic: which TurboTax version
Replies: 18
Views: 939

Re: which TurboTax version

I have had rental properties and investment income for over 20 years. I use the Turbo Tax Deluxe + State CD. I've never had to upgrade. I use the CD because I want the ability to reload Turbo Tax on a future computer should I at some point in time be audited. Mine was available on sale at Target thi...
by Peter Foley
Mon Feb 04, 2019 4:03 pm
Forum: Personal Finance (Not Investing)
Topic: Should I Contribute To A Roth, Even If It Bumps Me Up To The Next Tax Bracket?
Replies: 23
Views: 2260

Re: Should I Contribute To A Roth, Even If It Bumps Me Up To The Next Tax Bracket?

Ed Slott wrote an article for financial adviser magazine on line. It may be of interest. Here are the topic headings: When Roths May Not Be Right – Ed Slott 1. Up front tax bill 2. Tax rates now and later 3. Beneficiaries Tax rates 4. Side effects of Roth Conversion – Stealth Taxes – Losing benefits...
by Peter Foley
Sun Feb 03, 2019 5:55 pm
Forum: Personal Finance (Not Investing)
Topic: Family finance benchmarking/feedback
Replies: 24
Views: 1809

Re: Family finance benchmarking/feedback

There are a few examples of the following on the web. You might try searching under financial milestones if this is the type of information you are looking for. FWIW, data points from May, 2013 issue of Money magazine: Age 30: Savings = 0.6 x Income Age 40: Savings = 2.4 x Income Age 50: Savings = 5...
by Peter Foley
Sun Feb 03, 2019 12:23 pm
Forum: Personal Investments
Topic: What do wise people do with 401(k) balances?
Replies: 35
Views: 4561

Re: What do wise people do with 401(k) balances?

There are options, some more desirable than others based on one's circumstance. Note - if it's a 401k with poor options you should move it and then look at the next steps. Some options include: 1. Annuity - a good option for those who are cutting it close in terms of retirement income/sustainability...
by Peter Foley
Sat Feb 02, 2019 5:39 pm
Forum: Personal Finance (Not Investing)
Topic: Downloadable Social Security Benefit Estimator (2019 Update)
Replies: 24
Views: 2177

Re: Downloadable Social Security Benefit Estimator (2019 Update)

Thanks for doing this. It is a lot of work to get this type of application right.
by Peter Foley
Sat Feb 02, 2019 5:33 pm
Forum: Personal Finance (Not Investing)
Topic: 457(b) wiki. I believe some correction is needed.
Replies: 11
Views: 875

Re: 457(b) wiki. I believe some correction is needed.

I have a 457b and am well acquainted with most of the provisions. I think the words "separation from that employer" are the most precise. "Retirement" has other implications.
by Peter Foley
Sat Feb 02, 2019 2:33 pm
Forum: Personal Investments
Topic: Help simplifying portfolio along with some questions
Replies: 10
Views: 590

Re: Help simplifying portfolio along with some questions

For the time being I would have future contributions go to bonds in the 401k. Many people don't hold an international fund. It is okay to just sell the fund for a loss and the wait a month and buy it back. Just be careful not to buy it back too soon and create a wash sale. I would be tempted to leav...
by Peter Foley
Fri Feb 01, 2019 11:53 pm
Forum: Personal Investments
Topic: Help simplifying portfolio along with some questions
Replies: 10
Views: 590

Re: Help simplifying portfolio along with some questions

Please read the following on the BH wiki: Tax-efficient fund placement To summarize - your bond allocation (to the extent possible) should be held in your 401k, Roth should be primarily, if not all stocks, because that has the best potential for appreciation and you want both contributions and earni...