Search found 465 matches

by berg
Mon Mar 25, 2024 10:56 am
Forum: Personal Finance (Not Investing)
Topic: In-laws 529 for grandkids, bite my lip or say something?
Replies: 58
Views: 5893

Re: In-laws 529 for grandkids, bite my lip or say something?

Rocky Mtn Man wrote: Sat Mar 23, 2024 11:12 am
leeks wrote: Thu Mar 21, 2024 1:13 pm Bite your lip unless they ask about your investment strategy or otherwise open the door to a conversation.
Agree. This falls into the category of unsolicited advice from one adult to another. The grandparents may spend a lot of time biting their lips on their son-in-law's waistline, drinking, job choice, table manners, personal hygiene, etc.
lol this feels aggressive. Haha
by berg
Thu Mar 21, 2024 5:31 pm
Forum: Personal Finance (Not Investing)
Topic: In-laws 529 for grandkids, bite my lip or say something?
Replies: 58
Views: 5893

Re: In-laws 529 for grandkids, bite my lip or say something?

Well, I guess this was a polarizing topic! My gut was bite my lip, but it certainly felt good to at least vent here. While we have a great relationship with them, I do worry that they "trust" their FA and this will be more seen as a criticism of him...sigh. FWIW, coming from a family with not that much money myself, I asked my FIL to introduce me to his FA when I was about 24 years old and looking at Roth IRA. I posted a question about what he suggested on a different forum (GetRichSlowly, sadly not around anymore)...and they all told me to run -- he suggested a front load C share high expense ratio target fund. So I've known for a long time what kind of investments this guy offers. Luckily the internet told me to run for the hill...
by berg
Thu Mar 21, 2024 11:27 am
Forum: Personal Finance (Not Investing)
Topic: In-laws 529 for grandkids, bite my lip or say something?
Replies: 58
Views: 5893

In-laws 529 for grandkids, bite my lip or say something?

My in-laws have been generous and have provided money at birthdays and Christmas for our kids since they were born. They originally just wrote us checks, but at some point along the way their financial advisor convinced them it would be better off to have in their name vs. the kids or in ours (I didn't totally understand, but didn't want to fight it). I know there is some strategy there, but at the end of the day they ended up creating two 529s with them as the owners and our kids as FBO. I understand there might be some FAFSA strategy, but we are high income and high network, I think even without $1 of this money our kids wouldn't be eligible for any need based aid. I haven't thought that much about it and appreciated the generosity, but e...
by berg
Tue Mar 12, 2024 6:43 am
Forum: Personal Finance (Not Investing)
Topic: Holding six figures of cash for the next year
Replies: 18
Views: 2790

Re: Holding six figures of cash for the next year

zie wrote: Mon Mar 11, 2024 4:40 pm
veggivet wrote: Mon Mar 11, 2024 3:24 pm My response to your first question is that I'd have zero qualms about exceeding the SIPC limit in a MMF.
You answered your second question yourself in your post. The needle will barely budge, so do whatever is simplest for you.
Agreed! OP: Just make sure the cash vehicle you decide on is all US government debt(aka treasuries), and not some reaching for yield complicated mess. Any brokerages core/default MMF would almost certainly qualify (I know Vanguards and Fidelity's both do for instance). SGOV is an ETF that would also work fine and could be bought at any brokerage and holds short term(3 month max) US govt treasuries.
I have it all in VMFXX. Is that a reasonable one?
by berg
Mon Mar 11, 2024 2:59 pm
Forum: Personal Finance (Not Investing)
Topic: Holding six figures of cash for the next year
Replies: 18
Views: 2790

Holding six figures of cash for the next year

I am fortunate to be in a situation where I sold a lot of company stock and did not have taxes withheld. Due to safe harbor rules, I can hold all the cash for the next year penalty-free. It is about $364,000. We currently have most of our cash in Vanguard Money Market at 5.27%. I also have a Fidelity account where some stock was that has a Money Market at 5.02% ($900 difference for the year!) My big questions are: Would you have more than the SPIC limit in a money market? (this money + cash for other needs would put us over the limits) Knowing we will need the cash in 13 months, would you consider a lower rate CD to lock in or roll with the money market (I know no crystal ball, but curious what you all think) I know, first-world problems, b...
by berg
Sat Mar 09, 2024 8:16 am
Forum: US Chapters
Topic: Post your Financial Milestone Announcements Here
Replies: 3617
Views: 568623

Re: Post your Financial Milestone Announcements Here

After market increases and fully diversifying out of company stock (the thing I have found hardest to follow the Bogelhead approach emotionally throughout the years we hit some big milestones:
  • Our taxable investment account is now over $1M, growing to $1.2M
  • Our overall portfolio is $2.6M
  • Our net worth is now about $3.6M
Age 40 now and little more than a decade on Bogleheads and we have come a long way from $295k net worth! We have been very fortunate and will keep staying the course as we aim for an early retirement! Thank you, all! :sharebeer
by berg
Tue Mar 05, 2024 8:40 pm
Forum: Personal Finance (Not Investing)
Topic: How much to target in 529 for covering full tuition?
Replies: 75
Views: 8590

Re: How much to target in 529 for covering full tuition?

Update to our situation. We have sold a big chunk of company stock that built up. After taxes it is about $450k. The plan is to just add it to our portfolio, bringing our portfolio to about $2.5M. Another thought we had that is be curious to get opinions on. We currently save $800 per month per kid (2nd and 3rd graders). That puts us in a path to our goal of having about 60% of an expensive private school saved. Each kid has around $100k in their 529s today. Alternatively, instead of putting all the proceeds in taxable, we could put about $90k in each kids 529 and let it ride, stopping monthly contributions. This gets the benefit of more time in market with about ten years before college. Part of me likes the idea of front loading and part ...
by berg
Tue Mar 05, 2024 11:38 am
Forum: Personal Investments
Topic: Diversifying vs. Tax Management
Replies: 6
Views: 1074

Re: Diversifying vs. Tax Management

[. . .] $450k or so will be hit with the Massachusetts tax on income over $1M. [. . .] Separate from the MA tax ... have you checked for the possibility of federal Alternative Minimum Tax (AMT) by running this scenario through a full-featured tax program? (2023 version of tax program should be fine for planning purposes.) AMT is a tricky, slippery, non-intuitive beast, but one of the possible triggers is - AGI** being over the threshold where the AMT exemption starts phasing out ( $1,156,300 (MFJ) in 2023; don't know what it is for 2024) plus - a very large percentage of that is LTCG (or qualified dividends taxed at LTCG rates) **Well, technically it is AMTI (Alternative Minimum Taxable Income) ... but AGI is close enough as a rule-of-thum...
by berg
Mon Mar 04, 2024 8:55 pm
Forum: Personal Investments
Topic: Diversifying vs. Tax Management
Replies: 6
Views: 1074

Re: Diversifying vs. Tax Management

Oh, another pro in the column of just sell is my income was lower last year and I'll be in safe harbor without needing to pay any taxes on this sale until April 2025, which at today's money market rates is $12k in income on the $200k in taxes owed...
by berg
Mon Mar 04, 2024 8:14 pm
Forum: Personal Investments
Topic: Diversifying vs. Tax Management
Replies: 6
Views: 1074

Re: Diversifying vs. Tax Management

Suck it up and pay the taxes, no free lunch, diversify asap - end up with 3 fund portfolio of around $2.5M I didn't follow all the details of the total tax-burden, but that's probably a better way to look at this. Selling it all at once does get you instant diversification but the tax cost to switch seems high enough to prefer one of the other two options. Tax burden = LTCG @ 20% Fed + 5% for MA + 4% special tax > $1M on $450K of the $650K stock proceeds = $180K ? Is that the right dollar amount? NIIT of 3.8% (but will hit that regardless), so $450 * 20%+3.8%+5% 4% special tax > $1M (32.8%) on $450K = $147,600. Sell ~$200k, avoids the Massachusetts tax for this year, but would leave me 17% still in this stock Continuing from the line of th...
by berg
Mon Mar 04, 2024 2:09 pm
Forum: Personal Investments
Topic: Diversifying vs. Tax Management
Replies: 6
Views: 1074

Diversifying vs. Tax Management

Curious about what you would do, given my situation. I know the first answer is going to be unanimous, hurry up and diversify! I am fortunate to be sitting on some company stock with a LTCG. I have sold a bunch over the years, but am left with this bunch of shares, which has recently gone up a bunch, hooray! The current portfolio is about $2.75M and this stock is now around $650k, having grown to about 24% of our portfolio. Because we already sold a bunch this year for STCG, our income for 2024 will be close to $800k. If we sell this stock to diversify, we will pay 20% on all LTCG and $450k or so will be hit with the Massachusetts tax on income over $1M. The difference between selling now and in 2025 would be about $30k (small in the scheme...
by berg
Tue Feb 27, 2024 2:31 pm
Forum: Personal Finance (Not Investing)
Topic: AMT credit confusion
Replies: 2
Views: 417

AMT credit confusion

Let me start by saying how crazy the AMT seems to be. I'm wondering if someone could possible help explain to me in very simple terms... Here is my situation. In 2022, I exercised ISOs of shares around $35. I did not sell them looking to hold for LTCG. So I paid AMT @ 28% on a $183k bargain element. The stock is now trading at around $20 (oof) and I am looking to diversify. So I would be selling for about $113k profit, $70k less than I paid taxes on for AMT (about $20k extra - 183 * 28%). Additionally, as of right now, I will have a carryforward AMT credit of $70k for 2024. I diversified some of my other holdings and in 2024 our income will be about $800k. Next year it will be closer to $400k. We are trying to determine the optimal way to d...
by berg
Fri Feb 23, 2024 2:57 pm
Forum: Personal Finance (Not Investing)
Topic: Do current interest rates change how you save?
Replies: 5
Views: 729

Do current interest rates change how you save?

I've read so many posts here for many years to the effect of "I have a home down payment I'm saving, but don't want it just making no money in a savings account what should I do?" Now that savings interest rates are high, does it make sense to keep even more cash than you might have before? My specific situation: I was recently fortunate to sell a large chunk of company stock. We have some expenses earmarked for the cash (home renovation, vacation), but the rest was planned to be added to our investments. But it occurred to me, with interest rates where they are, would it make sense to keep more on hand fo future purchases? e.g. my wife has a five year old car we will probably keep in the range of 8 to 10 years. With that time hor...
by berg
Wed Feb 14, 2024 11:49 am
Forum: Personal Finance (Not Investing)
Topic: Enroll in employer supplemental long term disability?
Replies: 1
Views: 217

Enroll in employer supplemental long term disability?

Sorry for another insurance question! I'm 40, wife is 38. My income is $240 + bonus + stock, hers is $100k. Net worth $3.5M, two kids ages 9 and nearly 8. My employer offers long term disablity at 40% through prudential. I can buy up an additional 20% for $482 per year which gets me $48k coverage. The benefit kicks in at 180 days and lasts until age 65. Considered disabled when you "can't perform the material and substantial duties of your regular occupation." After 24 months it falls back to "any occupation reasonably fitted to education, training or experience." (unclear how good that coverage would be). Anyway, my gut is not to add this given our net worth and the restrictive nature of the plan, but I know long term d...
by berg
Tue Feb 13, 2024 9:54 pm
Forum: Personal Finance (Not Investing)
Topic: Enroll in employer supplemental life?
Replies: 10
Views: 962

Re: Enroll in employer supplemental life?

Great. Thanks!

My instinct was it wasn’t needed, but since I have a one time chance to get coverage without evidence of insurability, figured I should double check!
by berg
Tue Feb 13, 2024 10:13 am
Forum: Personal Finance (Not Investing)
Topic: Enroll in employer supplemental life?
Replies: 10
Views: 962

Enroll in employer supplemental life?

I am 40 and starting a new job. We have kids ages 9 and almost 8.

We have term life insurance we got in 2014. My wife (38) has $1M 30 year policy we pay $970 for) I have a $1M for 30 years and $500k for 20 years I pay $2250 for. Net worth is currently around $3.5M. My wife makes about $110k, I make around $240k + bonus + plus stock.

I get 1.5x salary at new job paid by employer.

As this new job, for first time enrollment I can enroll up to $1M without evidence of insurability. It would be $1,033 per year. Seems like a deal compared to my term, but not sure if it is worth it or not (from cost or need). My gut is between our net worth and current insurance we are in a solid spot if something happens to me. But it is a one time chance!
by berg
Tue Feb 13, 2024 8:50 am
Forum: Personal Investments
Topic: Any reasons not to rollover my 401k?
Replies: 32
Views: 3473

Re: Any reasons not to rollover my 401k?

I've found many 401K plans riddled with quarterly 'Record keeping fees' along with limited/fairly expensive options. Some people benefit from the relative safe harbor of limited investment options within a 401K and/or maybe will need a future loan or withdrawal (rule of 55, etc) from the current 401K plan. If you're a young gambler by nature then keep yourself within the confines of a 401K plan until your love of speculation diminishes or you know you can keep it in check. IRA's can be the wild west for some, especially if merging in a bunch of old 401K's into a large lump sum with endless investment options compounded with a potential lack of experience in managing as to what may be viewed as a large sum of money. Just my .2cents. I’m com...
by berg
Mon Feb 12, 2024 8:43 pm
Forum: Personal Investments
Topic: Any reasons not to rollover my 401k?
Replies: 32
Views: 3473

Re: Any reasons not to rollover my 401k?

Thanks! I found a 10 page fee disclosure document.

As far as I can tell (and asked chathpt to give its a read as well) the only fee is a $49 annual participant admin fee covered by my employer (though they have the right to shift to me). Nothing is percent based. There are a few other fees for things like check writing. But I don’t see anything else. Do you think I’m missing something? This is a plan for a large public company so I would expect a decent plan but you all have me wondering! I thought it would be a simple yes to rollover given the decent investment options.
by berg
Mon Feb 12, 2024 12:58 pm
Forum: Personal Investments
Topic: Any reasons not to rollover my 401k?
Replies: 32
Views: 3473

Re: Any reasons not to rollover my 401k?

Thanks for all the great responses!

We do the backdoor roth annually, so have avoided rolling over to an IRA to avoid any issues there.

Sounds like the most important next step is to determine the admin fees on my plan. I checked the SPD and didn't see anything jump out. What is the easiest way to determine? Thanks!!
by berg
Sun Feb 11, 2024 8:10 am
Forum: Personal Investments
Topic: Any reasons not to rollover my 401k?
Replies: 32
Views: 3473

Any reasons not to rollover my 401k?

I just started a new job and am considering rolling over two old 401ks. When I started my last job I did not rollover from two jobs ago because the investment options were limited. So I now have two old Fidleity 401ks (one with $300k, one with $200k) with more limited options than my current employer.

My new employer is with Merrill Lynch and has the following options which looks great:

FXAIX - Fidelity 500
FSMAX- Fidelity Extended Market
FTIHX - Fidelity Total International
FXNAX - Fidelity US Bond

Seems like I can make a simple three fund low cost index portfolio all in here. Any reason not to? This is my first experience with Merrill Lynch. Any questions I should be asking to be sure with the new plan.
by berg
Wed Jan 10, 2024 9:43 am
Forum: Personal Finance (Not Investing)
Topic: Calculating our "number" with early retirement and pension
Replies: 11
Views: 1883

Re: Calculating our "number" with early retirement and pension

Good suggestions so far. VPW and RPM (Retiree Portfolio Model), https://www.bogleheads.org/forum/viewtopic.php?p=1405885#p1405885, are good places to start. Note that RPM requires more time investment, but is rather robust. You have a few years it sounds like. IF retirement involves any travel desires, you may wish to keep your wife's retirement date flexible. (Traveling in shoulder seasons, rather than summer, tends to be a good deal less crowded.) We haven't found health insurance and spending to be that big of a deal--we retired in 2017 at 57/56, with spend in the same ballpark as you are talking about, with no pensions. Everyone's story/plans are different, and for those with health issues, our plan would not be optimal. For us, howeve...
by berg
Tue Jan 09, 2024 8:30 pm
Forum: Personal Finance (Not Investing)
Topic: Calculating our "number" with early retirement and pension
Replies: 11
Views: 1883

Re: Calculating our "number" with early retirement and pension

Curious what do you plan to do the 5 yrs your wife has to keep working? ( my husband retired at 56, stress of job, we had no financial plan). I still am rather resentful that I killed myself in stressful jobs for 11 yrs and he was not working until I was laid off at 64. Also, $200K a year is a lot to spend with only $85K salary IMHO. Good luck. Our goal is flexibility. I don't know yet, but hope to maybe volunteer or find some work in the local schools (she's a teacher). Our big mutual goal, is that with our kids out of the house and her having some remaining years as a teacher, we want to be able to spend the summers enjoying ourselves while we are still young -- traveling, spending time relaxing at a cottage, etc. Our dream is to be able...
by berg
Tue Jan 09, 2024 8:27 pm
Forum: Personal Finance (Not Investing)
Topic: Calculating our "number" with early retirement and pension
Replies: 11
Views: 1883

Re: Calculating our "number" with early retirement and pension

Using round numbers, say we want $200k of spending. Her salary is $85k. So for five years we need a $115k from the portfolio. Then her pension is $70k, for seven years we'd need $130k from the portfolio. Then say (again just round numbers, my SS is $30k per year), going forward we'd need $100k from the portfolio. Maybe you're just using words casually here, but your wife's salary is going to be taxed and so are any withdrawals from your portfolio that have capital gains. $200k in spending will require more than $200k in income. In any event, I'd think about this a bit differently than you have. The years before your wife retires have fixed (albeit estimated) expenses. I'd prefer to have that amount in a portfolio (lets call it A) that woul...
by berg
Tue Jan 09, 2024 8:14 pm
Forum: Personal Finance (Not Investing)
Topic: Calculating our "number" with early retirement and pension
Replies: 11
Views: 1883

Re: Calculating our "number" with early retirement and pension

stuper1 wrote: Tue Jan 09, 2024 6:31 pm Are you familiar with the VPW worksheet? It is a very helpful tool. I just plugged your numbers into it, and it says you need about $3M at age 55 to have an annual "income" of about $200,000 for the rest of your life. It takes into account that your wife's pension is not inflation adjusted and your social security is inflation adjusted.
I have not. I will check it out. Thanks!! This is exactly what I was looking for, I knew someone must have done it!
by berg
Tue Jan 09, 2024 6:20 pm
Forum: Personal Finance (Not Investing)
Topic: Calculating our "number" with early retirement and pension
Replies: 11
Views: 1883

Calculating our "number" with early retirement and pension

I have spreadsheets upon spreadsheets where we run numbers. We are still a way off, but we like to plan. I'm wondering if any of the Bogleheads have a simple approach to help us think about our number. Our goal is for me to retire at age 55 after our youngest graduates (fingers crossed) college. My wife will continue teaching another five years until she is fully eligible for her maximum teacher's pension (including healthcare benefits). So what this looks like is: Years 1 through 5, her full income, portfolio used to supplement my income Years 6 through 12 (if I take SS at 67, she is not eligible as a teacher), portfolio + her pension Years 13+, portfolio + her pension + my SS Using round numbers, say we want $200k of income. Her salary is...
by berg
Tue Dec 26, 2023 1:48 pm
Forum: Personal Investments
Topic: 401k strategy switching employers
Replies: 25
Views: 2446

Re: 401k strategy switching employers

Okay great, that’s exactly what I was thinking! I will have 2.5 pay periods in 2024 at my current employer and should be able to put about $15k post tax. Might as well do that and then max out at my new employer, right? Am I missing anything? Nope, you are not missing anything. What's your plan for the existing 401(k) plan? Will the after-tax contributions be converted to In-Plan Roth, or distribution to an external Roth IRA? Since you will be leaving the current employer shortly it probably does not matter, you will be able to roll the after-tax contributions to an external Roth IRA without issues after separation. But some employers limit the number of In-Plan Roth conversions or number of In-Service distributions of after-tax amounts (s...
by berg
Tue Dec 26, 2023 12:31 pm
Forum: Personal Investments
Topic: 401k strategy switching employers
Replies: 25
Views: 2446

Re: 401k strategy switching employers

lakpr wrote: Tue Dec 26, 2023 11:39 am
berg wrote: Tue Dec 26, 2023 11:13 am I am interested in the mega backdoor, but have never done it before. I believe my current employer would allow it, but unsure my new employer. How does this impact your thinking?
In this case I would contribute the maximum I can at current employer, all on after-tax basis. Will contribute the max allowed at the new employer only. The employee pre-tax or Roth contributions is limited to $23k ($30.5k if older than 50), but the after-tax limit will go up to $66k / $73k ...
Okay great, that’s exactly what I was thinking! I will have 2.5 pay periods in 2024 at my current employer and should be able to put about $15k post tax. Might as well do that and then max out at my new employer, right?

Am I missing anything?
by berg
Tue Dec 26, 2023 11:13 am
Forum: Personal Investments
Topic: 401k strategy switching employers
Replies: 25
Views: 2446

Re: 401k strategy switching employers

DVMResident wrote: Tue Dec 26, 2023 10:06 am Since you’re switching pretty much at the new year, it’s pretty simple.

Max out employer #1’s 2024 match as much as possible (sounds minimal because of the timing).

Then contribute to employer #2. The combined limit of both 401(k)s is $23k for 2024. The 401(k) won’t stop you and you’ll need to keep track of this yourself (or run into painful corrective paperwork later if you exceed the limit).

That’s probably all you need to think about. If a megabackdoor Roth IRA is also under consideration, let’s continue the discussion.
I am interested in the mega backdoor, but have never done it before. I believe my current employer would allow it, but unsure my new employer. How does this impact your thinking?
by berg
Tue Dec 26, 2023 5:52 am
Forum: Personal Investments
Topic: 401k strategy switching employers
Replies: 25
Views: 2446

Re: 401k strategy switching employers

I’ll be switching employers in the new year and want to make sure I’m not missing anything when it comes to 401k. My current employer matches 50% of 6%. My new employer will match 100% of 6% (yay!), but not until one year of service (boo). It is a public company with 401k managed through Merrill Lynch. While I don’t have the exact option, I assume they have low cost index funds. Anyway, I will keep the 6% with my current employer until I depart early in the year. Any benefit to increase further or keep at minimum for match? Sort of seems like a coin flip and cashflow question and not really anything else. Am I missing anything? You might check with HR & see if current employer uses a "true-up 401k match" for the year, such th...
by berg
Sun Dec 24, 2023 10:03 am
Forum: Personal Investments
Topic: 401k strategy switching employers
Replies: 25
Views: 2446

Re: 401k strategy switching employers

Also ask the new employer for a copy of the Annual Fee Disclosure to participants which will include the fund lineup, ERs and any annual/other fees. Since the only 401k you will have access to in 2024 is your current employer, contribute up to the limits if it makes sense for you and you will have sufficient compensation. If your new employer’s plan is low-cost with good fund choices and accepts rollovers in, consider rolling over your old plan’s balance in 2025. To clarify, I’m eligible to contribute to my new plan in 2024, they company just won’t match until after one year of service. Do they start matching at a year of service, or do they match through the year but don't give it to you until the end of the year? Not until one year of se...
by berg
Sun Dec 24, 2023 9:51 am
Forum: Personal Investments
Topic: 401k strategy switching employers
Replies: 25
Views: 2446

Re: 401k strategy switching employers

Also ask the new employer for a copy of the Annual Fee Disclosure to participants which will include the fund lineup, ERs and any annual/other fees. Since the only 401k you will have access to in 2024 is your current employer, contribute up to the limits if it makes sense for you and you will have sufficient compensation. If your new employer’s plan is low-cost with good fund choices and accepts rollovers in, consider rolling over your old plan’s balance in 2025. To clarify, I’m eligible to contribute to my new plan in 2024, they company just won’t match until after one year of service. Do they start matching at a year of service, or do they match through the year but don't give it to you until the end of the year? Not until one year of se...
by berg
Sun Dec 24, 2023 9:33 am
Forum: Personal Investments
Topic: 401k strategy switching employers
Replies: 25
Views: 2446

Re: 401k strategy switching employers

I’ll be switching employers in the new year and want to make sure I’m not missing anything when it comes to 401k. My current employer matches 50% of 6%. My new employer will match 100% of 6% (yay!), but not until one year of service (boo). It is a public company with 401k managed through Merrill Lynch. While I don’t have the exact option, I assume they have low cost index funds. Yes, starting end of January. My HR contact is on vacation through the new year. I can ask when they return, but trying to make sure I don’t miss anything obvious. Anyway, I will keep the 6% with my current employer until I depart early in the year. Any benefit to increase further or keep at minimum for match? Sort of seems like a coin flip and cashflow question an...
by berg
Sun Dec 24, 2023 9:28 am
Forum: Personal Investments
Topic: 401k strategy switching employers
Replies: 25
Views: 2446

Re: 401k strategy switching employers

HomeStretch wrote: Sun Dec 24, 2023 9:08 am Also ask the new employer for a copy of the Annual Fee Disclosure to participants which will include the fund lineup, ERs and any annual/other fees.

Since the only 401k you will have access to in 2024 is your current employer, contribute up to the limits if it makes sense for you and you will have sufficient compensation.

If your new employer’s plan is low-cost with good fund choices and accepts rollovers in, consider rolling over your old plan’s balance in 2025.

To clarify, I’m eligible to contribute to my new plan in 2024, they company just won’t match until after one year of service.
by berg
Sun Dec 24, 2023 8:52 am
Forum: Personal Investments
Topic: 401k strategy switching employers
Replies: 25
Views: 2446

401k strategy switching employers

I’ll be switching employers in the new year and want to make sure I’m not missing anything when it comes to 401k.

My current employer matches 50% of 6%. My new employer will match 100% of 6% (yay!), but not until one year of service (boo). It is a public company with 401k managed through Merrill Lynch. While I don’t have the exact option, I assume they have low cost index funds.

Anyway, I will keep the 6% with my current employer until I depart early in the year. Any benefit to increase further or keep at minimum for match? Sort of seems like a coin flip and cashflow question and not really anything else.

Am I missing anything?
by berg
Wed Oct 25, 2023 10:05 pm
Forum: Personal Finance (Not Investing)
Topic: Does your significant other know about Bogleheads?
Replies: 97
Views: 10049

Re: Does your significant other know about Bogleheads?

Her: “Oh are you going to ask your friends on the internet what to do again?”

Me: “I wouldn’t make a decision without them.” :happy
by berg
Thu Oct 05, 2023 2:13 pm
Forum: Personal Finance (Not Investing)
Topic: $6k annual grocery limit on AMEX blue cash card
Replies: 39
Views: 6755

Re: $6k annual grocery limit on AMEX blue cash card

Thinking about opening the AAA card and using that instead of the Amex for 6% back with the annual fee.

Is there a downgrade option on the Amex or will I have to close it? If I have to close, are there any risks to not having any Amex card any more? Thanks!
by berg
Thu Sep 28, 2023 8:48 am
Forum: Personal Finance (Not Investing)
Topic: How much to target in 529 for covering full tuition?
Replies: 75
Views: 8590

Re: How much to target in 529 for covering full tuition?

This topic seems to often go in a few familiar directions: financial aid, how much "should" parents pay for their children's education, what's a good value in higher education, etc. These are all good topics. In this case, it would appear OP can afford to fund 529s at a higher level and wants to evaluate the consequences. I'd suggest to consider what happens if you overfund 529 accounts. Whatever the root cause (kid chooses to go to less expensive school, gets a scholarship, doesn't go at all, etc., - all are legitimate unknowns), the options are fairly simple. If you don't need all the money in one 529 account, you can transfer it to another of your children. It can be used for graduate school. You can leave the money in the acc...
by berg
Wed Sep 27, 2023 1:05 pm
Forum: Personal Finance (Not Investing)
Topic: How much to target in 529 for covering full tuition?
Replies: 75
Views: 8590

Re: How much to target in 529 for covering full tuition?

Ironically, I picked Syracuse as an example sort of randomly as an expensive private university. I just checked the US News rankings and Umass and Syracuse tied at #67. At the risk of stirring the pot more in this debate here. It is hard not to look at this and see the great value for money. But I do wonder how much perception does matter sometimes. I hate to say that but does someone with Syracuse on their resume have a perceived better education? Life certainly isn't fair and sometimes perception is reality! I think when you get outside of the top 20-25 schools on US News's rankings, the specific rankings don't matter that much. Name recognition and reputation by that point also vary significantly based on geography...I'm guessing someon...
by berg
Wed Sep 27, 2023 10:32 am
Forum: Personal Finance (Not Investing)
Topic: How much to target in 529 for covering full tuition?
Replies: 75
Views: 8590

Re: How much to target in 529 for covering full tuition?

Ironically, I picked Syracuse as an example sort of randomly as an expensive private university. I just checked the US News rankings and Umass and Syracuse tied at #67.

At the risk of stirring the pot more in this debate here. It is hard not to look at this and see the great value for money. But I do wonder how much perception does matter sometimes. I hate to say that but does someone with Syracuse on their resume have a perceived better education? Life certainly isn't fair and sometimes perception is reality!
by berg
Mon Sep 25, 2023 9:58 am
Forum: Personal Finance (Not Investing)
Topic: How much to target in 529 for covering full tuition?
Replies: 75
Views: 8590

Re: How much to target in 529 for covering full tuition?

For those of you who are saying to fund the 529 to a certain point and then take out of taxable, do you keep those funds in your regular investment asset allocation or do you create a separate taxable fund with the intention of use for college if needed? The reason I ask is the asset allocation for our 529s is starting to shift down at a faster pace than our retirement portfolio.
by berg
Mon Sep 25, 2023 8:31 am
Forum: Personal Finance (Not Investing)
Topic: How much to target in 529 for covering full tuition?
Replies: 75
Views: 8590

Re: How much to target in 529 for covering full tuition?

This is tangential to the OP, but IMO it is uncommon here to commit to fully funding private education. Most posters believe in CC or state flagship, giving their kids a financial stake in college, and funding their own retirement first. Then there are the many threads about how private colleges are a waste of money etc. You think not "committing to fully funding a private education" equates to an "unwillingness to help your children"?!? If you have 3.8M in your 40s, yes. I stand by what I said. Most posters here would rather retire earlier than do everything they can to help their kids. sorry, but this strikes me as a ridiculously overbroad statement. Do you think paying $80k/year for a small liberal arts college is &q...
by berg
Mon Sep 25, 2023 7:58 am
Forum: Personal Finance (Not Investing)
Topic: How much to target in 529 for covering full tuition?
Replies: 75
Views: 8590

Re: How much to target in 529 for covering full tuition?

bucky6225 wrote: Sun Sep 24, 2023 6:33 pm I just used the Vanguard college cost projector tool and sure enough the all-in cost for Syracuse is projected to be $572k in 10 years.

I just don’t see how the system doesn’t break at some point. It’s pure madness when a mediocre school can get away with that sort of price tag, whether you get financial aid or not.
It is hard to believe, but as a long time Boglehead, I've been reading that sentiment for more than 10 years! I remember this being said when I started college in 2001!
by berg
Sun Sep 24, 2023 10:56 am
Forum: Personal Finance (Not Investing)
Topic: How much to target in 529 for covering full tuition?
Replies: 75
Views: 8590

Re: How much to target in 529 for covering full tuition?

Inflation in higher education continues to rise at an unsustainable rate and doesn’t really show signs of slowing. But I have a very difficult time believing that a school like Syracuse will be able to command $500-$600k all-in cost. Even a school like Harvard costing half a million seems absurd. How big is the pool of families that can afford that? Maybe enough for a handful of elite universities, but Syracuse? I suppose, but I have been hearing that for years and years! Looking back when I started college about 20 years ago, Syracuse tuition was about $22k, now it is $62k. That’s about 5% per year. I don’t see any reason to plan for that slowing down, which would mean about $102k per year on tuition. Now I hope room and board etc isn’t a...
by berg
Sun Sep 24, 2023 9:27 am
Forum: Personal Finance (Not Investing)
Topic: How much to target in 529 for covering full tuition?
Replies: 75
Views: 8590

Re: How much to target in 529 for covering full tuition?

So to sum up questions: What % would you target if you want to be prepared to 100% cover premium cost 4 year private school Would you frontload that cost out of current investments or stick to monthly contributions? How does the early retirement goal impact things? Thanks for all the replies. In reading through the comments, it seems the consensus still falls within the general feeling I often see posted here: target full coverage state flagship school in 529 and then cover the rest through taxable or cashflow if we choose to (which we are planning to do). At our current balances and saving rate, even at a 4% return the next 10 years, we will have enough to fully cover in-state at Umass Amherst. And yes, those of you inferred correctly tha...
by berg
Sat Sep 23, 2023 1:46 pm
Forum: Personal Finance (Not Investing)
Topic: How much to target in 529 for covering full tuition?
Replies: 75
Views: 8590

How much to target in 529 for covering full tuition?

Our kids are in 2nd and 3rd grade, so will start college in 10 and 11 years. We max a 401k, 403b, 457 and Backdoor Roths + are on track for a teacher's pension, on a solid path to retirement. Given our income, we'd like to cover as much of college for our two kids as possible, even at a higher cost private university if that is where they end up. NW ~$3.8M, ~$2.7M in investments. Ages 40 and 38. I'm targeting and early retirement (at least from full time work) between ages 50 and 55 (when the kids graduate high school or college), my wife will work until she can get her pension at 58 (about 5 years after our youngest graduates college). Part of my thinking here is I don't want to consider an early retirement if I haven't covered the cost of...
by berg
Tue Sep 19, 2023 10:01 am
Forum: Personal Finance (Not Investing)
Topic: Estimating future pension
Replies: 10
Views: 1165

Re: Estimating future pension

Your math checks out, but you are estimating her future salary, not her future pension, as your post title suggests. Her future pension will be X% of the final salary, or somesuch formula. You need to check out that formula, in order to estimate per pension. Her pension website might also have tools / calculators that might provide some estimates and / or guidance. Yup! As of this moment it is a generous 80% (knock on wood it holds). So in this case 80% or $82,000 = $65,600. I guess the other thing to consider is that it is not an inflation adjusted pension. So will continue the lose value. After ten years it’s like $48k in todays dollars. After 20 years it’s like $36k (assuming 3% inflation). Non COLA pensions do lose purchasing power as ...
by berg
Tue Sep 19, 2023 8:49 am
Forum: Personal Finance (Not Investing)
Topic: Estimating future pension
Replies: 10
Views: 1165

Re: Estimating future pension

Your math checks out, but you are estimating her future salary, not her future pension, as your post title suggests. Her future pension will be X% of the final salary, or somesuch formula. You need to check out that formula, in order to estimate per pension. Her pension website might also have tools / calculators that might provide some estimates and / or guidance. Yup! As of this moment it is a generous 80% (knock on wood it holds). So in this case 80% or $82,000 = $65,600. I guess the other thing to consider is that it is not an inflation adjusted pension. So will continue the lose value. After ten years it’s like $48k in todays dollars. After 20 years it’s like $36k (assuming 3% inflation). Most people get raises over time, get promoted...
by berg
Mon Sep 18, 2023 7:30 pm
Forum: Personal Finance (Not Investing)
Topic: Estimating future pension
Replies: 10
Views: 1165

Re: Estimating future pension

seugene wrote: Mon Sep 18, 2023 6:23 pm Your math checks out, but you are estimating her future salary, not her future pension, as your post title suggests. Her future pension will be X% of the final salary, or somesuch formula. You need to check out that formula, in order to estimate per pension. Her pension website might also have tools / calculators that might provide some estimates and / or guidance.
Yup! As of this moment it is a generous 80% (knock on wood it holds).

So in this case 80% or $82,000 = $65,600.

I guess the other thing to consider is that it is not an inflation adjusted pension. So will continue the lose value. After ten years it’s like $48k in todays dollars. After 20 years it’s like $36k (assuming 3% inflation).
by berg
Mon Sep 18, 2023 4:57 pm
Forum: Personal Finance (Not Investing)
Topic: Estimating future pension
Replies: 10
Views: 1165

Estimating future pension

There is no perfect formula, but want to try to generally estimate my wife's pension value in future dollars. At a certain point she maxes out on experience increases and it is just tied to the overall contract % increase which has generally lagged inflation (e.g. 0.75 to 1.5% for many years, with high inflation recently they were able to negotiate 2% per year for 3 years). She can retire in 20 years. So the formula I use is, calculating 1% increase per year for her salary on average. Then I calculate average inflation at 3%. So basically, in real dollars she loses 2% per year compounding. To use round numbers, say she makes $100,000 now in 2023 dollars. At -2% real, her final salary in 20 years is worth about $67,000 in 2023 dollars. Now m...
by berg
Wed Aug 30, 2023 11:21 am
Forum: Personal Finance (Not Investing)
Topic: What lumpy expenses did you plan for in retirement?
Replies: 10
Views: 912

What lumpy expenses did you plan for in retirement?

I am 40 and my wife is 38 with two elementary school kids. We are diligent savers and follow the Bogleheads philosophy. Based on today's expense, we have a general idea of our number, but there is still a lot of time to go! Beyond typical spending, I'm curious what type of lump expenses you planned for or are planning for when retired which may be your target number + X. It is personal to everyone, so not trying to debate how much to spend or what to spend on. I am just curious to see what others have planned or are planning. For example, college savings (everyone can have their own plan from no help to fully paid private), contributions to a wedding for your kids, or a home down payment. Curious to see what people have planned for. And cur...