Search found 723 matches

by lhl12
Tue Mar 05, 2024 7:47 pm
Forum: Personal Investments
Topic: Should I Reduce $258k Capital Loss Carryforward?
Replies: 18
Views: 2179

Re: Should I Reduce $258k Capital Loss Carryforward?

I assume you and your wife file your tax returns as married filing jointly. If so, then when the first of you dies (let’s say you for arguments sake) , then your wife will will retain the loss until her death. At that point it will expire. If you never realize any capital gains for the rest of your lives and if all your equities receive the step up in basis at the time of your death then there’s nothing lost from the expiration of the carry forward. You indicated that you expect to live many more years. In that case, I wouldn’t be in a hurry to use up the loss by doing something artificial. If you have several decades more of joint life expectancy then it’s very possible that you will realize some sort of gain in the natural course of thing...
by lhl12
Tue Feb 13, 2024 10:37 pm
Forum: Personal Investments
Topic: Requesting Advice: 87 Year Old Parent Asset Allocation
Replies: 24
Views: 2642

Re: Requesting Advice: 87 Year Old Parent Asset Allocation

I don’t object to the annuity idea but why transfer or gift anything to heirs during her lifetime? Making her judgment proof seems like a very narrow target to be aiming for. She is far below the threshold for estate taxes so everything should transfer smoothly (and tax free) at the time of her death. Also, to the extent she has appreciated equities at the time of her death her heirs will benefit from the step up in basis. Finally, what if some unexpected significant expense (or significant inflation) comes along? Why should she be beholden to her kids/heirs at that point? If she is still driving then make sure she has good insurance but otherwise what judgment is going to hit her? Seems awfully unlikely… The much more important issue is to...
by lhl12
Mon Jan 22, 2024 8:16 am
Forum: Personal Consumer Issues
Topic: Universal TV Remote W Sleep Timer
Replies: 19
Views: 1603

Re: Universal TV Remote W Sleep Timer

I’ve been struggling with this issue for years. Here’s what I’ve learned: Does your TV itself have a sleep timer function? If so, it should be pretty easy to program the button for the sleep timer on your TV’s remote onto any programmable universal remote. If your TV doesn’t have a sleep timer function then it is a much tougher problem. In that case you’d need some sort of home automation CPU to build the logic for the function and cut power to the TV after the desired delay. This will probably be much more money than you’d want to spend, The Apple TV box has a sleep timer function if you’re interested in going that route, but then you’d probably want a recent TV that has HDMI-CEC functionality to interface well with the Apple TV box. This ...
by lhl12
Wed Jan 03, 2024 9:47 pm
Forum: Personal Consumer Issues
Topic: What browser(s) do you use, and why? Mobile and Desktop
Replies: 49
Views: 7902

Re: What browser(s) do you use, and why? Mobile and Desktop

On iPhone and iPad, Safari. On PC, only Chrome for many years but recently tried Edge again and I like it. I am switching between the two to try to decide which I like better - so far a tossup.
by lhl12
Sat Dec 30, 2023 8:39 pm
Forum: Personal Investments
Topic: US Treasury Bills vs Money Market - slight advantages
Replies: 17
Views: 4048

Re: US Treasury Bills vs Money Market - slight advantages

The calculation is not cumbersome. Vanguard provides a document with the percentage of income from US government obligations during the tax year and you just multiply that percentage times your total dividends from the fund. :oops: We missed this last year with the VMFXX interest when filing 2022 state taxes. Fortunately that was only $200 in interest for about an $8 loss. Maybe our state will will let us back claim that with the 2023 tax filings :? : I no this is no excuse, but we've been complacent on state tax savings from interest because there hasn't really been any interest until the rates started going up a lot last year. Amend your state return. for $8? Yes. Don't let taxing authorities keep even one dollar of your money. This seem...
by lhl12
Sat Dec 23, 2023 2:24 am
Forum: Investing - Theory, News & General
Topic: Which year will I be taxed? Dividends Costco
Replies: 10
Views: 1962

Re: Which year will I be taxed? Dividends Costco

The COST dividend will be taxable in the year paid (2024), as others have said. Your 2023 1099 will not show the dividend and your 2024 1099 will show it Interestingly, however, your stock position will trade “ex-“ the dividend in 2023 and your year-end market value on your brokerage statement will be understated by the amount of the dividend. If you are calculating investment performance then to be correct you will need to add back the amount of the dividend as a “Dividend Receivable” on your year end 2023 balance sheet, then reverse the receivable when you receive the cash in 2024. Most individuals don’t know or care about this but large institutional investors need to handle it this way to calculate performance correctly. Technically the...
by lhl12
Wed Dec 20, 2023 5:10 pm
Forum: Investing - Theory, News & General
Topic: How long until a US treasury becomes eligible for margin borrowing?
Replies: 15
Views: 1320

Re: How long until a US treasury becomes eligible for margin borrowing?

Let’s say you have $1000 in cash in your fidelity account and you buy a $1000 t-bill in the open market.

That t-bill has some sort of margin requirement at Fidelity - let’s say 10% (though you’ll need to check with Fidelity to find out the correct number.

On the day you buy the t-bill, 10% of your cash gets used to collateralize the purchase of the t-bill. The remaining 90% is still available for whatever you’d like.

So, the t-bill becomes “eligible for margin borrowing” (your term) at the moment of purchase.

Your question, I think, is whether the answer is different if you buy the t-bill at auction. In that case you’ll need to ask Fidelity.
by lhl12
Wed Dec 06, 2023 9:31 pm
Forum: Personal Consumer Issues
Topic: Are newer Kindles any faster?
Replies: 52
Views: 7016

Re: Are newer Kindles any faster?

I have had an iPad and an oasis for several years. I recently switched from the oasis to a paperwhite. I travel a lot and am outside a lot. The iPad is terrible in any sort of direct sunlight. If you expect to be reading outdoors at all then a kindle is a must. Indoors during daytime or with the lights on I find the visual quality of the iPad a little better, but it’s close. I’m not sure how much of this is LED technology vs e-ink technology. If I’m reading a book that calls for references to other sources (like a history book, where I might want to go to Wikipedia periodically for timelines or more detail) then the iPad is much more convenient. Flipping between the kindle app and the browser in the iPad is quick and easy. Similarly, anythi...
by lhl12
Sat Oct 14, 2023 8:29 pm
Forum: Personal Consumer Issues
Topic: Best Small Drip Coffee Machine
Replies: 77
Views: 8389

Re: Best Small Drip Coffee Machine

remomnyc wrote: Fri Oct 13, 2023 11:23 pm I LOVED the coffee the Zojirushi 5-cup Zutto made. After breaking a few glass carafes, I gave up and bought a coffeemaker with a stainless steel carafe. I still miss my Zojirushi. To this day, it is still my favorite drip coffee. If you're a gentle dishwasher, I highly recommend it.
I love my Zojurushi. I’ve had it for ~ten years and it still works great.
by lhl12
Thu Aug 03, 2023 12:56 pm
Forum: Personal Consumer Issues
Topic: Best Purchase < $1000?
Replies: 231
Views: 28454

Re: Best Purchase < $1000?

Sandi_k wrote: Sat Jul 29, 2023 1:34 pm - TSA Pre-Check.
Yes! I would go one step further and say TSA Global Entry, which includes Pre-Check but also allows you to skip the immigration lines and go straight to the kiosks on international travel. Fantastic.
by lhl12
Mon May 15, 2023 7:59 am
Forum: Personal Investments
Topic: Newly Widowed and $9,000,000 in assets
Replies: 56
Views: 11665

Re: Newly Widowed and $9,000,000 in assets

You haven't said how may grandchildren you have or how old they are but in your position I would consider setting up a 529 plan for each grandchild. Depending on how many you have, you could front-end load each one with up to five years of contributions (which is the maximum allowed). If you choose, over time you could contribute more as well. You might well have enough assets and enough time for the 529's to compound such that each grandchild's college tuititon would be fully paid for by you.
by lhl12
Wed Mar 01, 2023 5:50 am
Forum: Personal Consumer Issues
Topic: Question on Paramount plus
Replies: 20
Views: 2448

Re: Question on Paramount plus

If your paramount+ subscription is still live I strongly recommend “The Offer” - a ten episode series about movies, culture, the mafia, friendship, crazy bosses, and lots more. Set in the 1970’s, built around the fictionalized (but mostly historically accurate) making of the movie “The Godfather”, it’s one of the best things I’ve seen in a long time.
by lhl12
Sun Feb 26, 2023 8:00 am
Forum: Personal Consumer Issues
Topic: please help me get started with TV streaming
Replies: 152
Views: 17946

Re: please help me get started with TV streaming

When I first switched from cable, I found it helpful to think of streaming as having a "basic" tier (like old-fashioned cable) and a series of "premium" channels (all the various individual streaming apps). There are a few options for the basic tier -- YouTube TV and Hulu+Live TV are the two big ones, though there are some smaller ones as well. You will need one of these if you want to watch live news, live sports, or your local network affiliate for local news. The problem with these "basic" apps is that they have become large bundles of non-premium channels themselves, which has caused their prices to rise. There's unfortunately no good way around this unless you get an OTA antenna. One GREAT feature of YouTu...
by lhl12
Tue Jan 10, 2023 10:52 am
Forum: Personal Consumer Issues
Topic: Building small house yourself as job
Replies: 80
Views: 7852

Re: Building small house yourself as job

There was a long thread on Mr. Money Mustache a few years ago when he built his own house in Colorado. You might read that thread (which I believe is archived on his website).
by lhl12
Sun Sep 18, 2022 7:24 am
Forum: Personal Finance (Not Investing)
Topic: Should I refinance early at a higher rate?
Replies: 14
Views: 1430

Re: Should I refinance early at a higher rate?

I would not willingly pay a higher rate now when there are still three years left on your rate. A lot can happen in three years. Also you say that you can pay the whole thing off so there is no downside for you if rates don’t come back down in three years. I have 4 years left on my 1.5% interest only mortgage and I’m not losing any sleep at night about it. I can pay it off in three years but I don't intend to. I'd prefer to have financing in place at 3.25% for the next ten years. If I don't refinance now and my option would be to refinance in three years at 4.375% or pay it off then at that point I would pay it off. However, by refinancing now and bearing three years of higher rates I take advantage of seven more years at a below-market ra...
by lhl12
Sat Sep 17, 2022 1:00 pm
Forum: Personal Finance (Not Investing)
Topic: Should I refinance early at a higher rate?
Replies: 14
Views: 1430

Re: Should I refinance early at a higher rate?

Raycpact wrote: Sat Sep 17, 2022 11:11 am You locked in a 10 year rate of 3.25% when the 10 year treasury is currently 3.45%?
Correct - the rate I have locked in is now significantly below market. If my current mortgage were close to maturity then it would be obvious to refinance. However as things stand, I would be giving up three more years of an even more favorable rate to get the benefit for seven more years. I think it is still worth it to refinance now, but it is less obvious to me.
by lhl12
Sat Sep 17, 2022 10:49 am
Forum: Personal Finance (Not Investing)
Topic: Should I refinance early at a higher rate?
Replies: 14
Views: 1430

Re: Should I refinance early at a higher rate?

All my investment assets are in a Boglehead-style portfolio with ~80% allocated to equities (which I'm very comfortable with). I have no other debt nor any other assets of significance. If I were to pay off the mortgage I would keep the same asset allocation so I would simply draw down all asset classes pro-rata (incurring significant taxes on the equities). The mortgage balance is about 10% of the value of the total investment portfolio.
by lhl12
Sat Sep 17, 2022 10:31 am
Forum: Personal Finance (Not Investing)
Topic: Should I refinance early at a higher rate?
Replies: 14
Views: 1430

Should I refinance early at a higher rate?

I have a 10/1 ARM on my primary residence that is fixed at 2.85% until Sept. 2025 (when the ten year fixed period expires) at which point it converts to an adjustable rate mortgage at a relatively unattractive spread - I think +2.75%. The mortgage is interest only and the loan amount is about 50% of the value of the house. I could pay off the mortgage in full now though I'd prefer not to so I can keep more assets available for investment purposes. A few months ago I went through the application process for a refinancing with my bank (B of A) and locked in a rate of 3.25% at that time. I have since dragged out the process with them as long as possible but now need either to complete the refinancing or release the locked-in rate. The refinanc...
by lhl12
Thu Jun 30, 2022 6:52 am
Forum: Personal Consumer Issues
Topic: Seeing the Acropolis in Athens
Replies: 15
Views: 2005

Re: Seeing the Acropolis in Athens

Was there two weeks ago and it wasn’t bad at all. Not sure how much more crowded it gets as the summer goes on though.

Be sure to bring hats, sunglasses, water and sunscreen - it is sunny and HOT. There are a few shady spots to stop at as you work your way up.

The Museum of the Acropolis is excellent and a must see after coming down from the Acropolis itself. It is right at the base of the Acropolis and it has excellent air conditioning
by lhl12
Sat May 14, 2022 9:47 am
Forum: Personal Finance (Not Investing)
Topic: Major fine art purchase, extra insurance?
Replies: 18
Views: 2387

Re: Major fine art purchase, extra insurance?

I never thought I would be one of those people but I just spent a whole lot (high 5 figures, a lot for me anyway) on a piece of artwork - I have specifically wanted this exact piece for nearly my entire life and it came to auction. Now that I'm receiving it soon - I'm worried - is it usually necessary to specifically add it to my insurance policy as a rider or if I have proof of value (what I paid at least) and adding it doesn't go over what my policy covers for belongings, is that enough? I've tried to decipher the policy AND tried talking to them but am still confused.. just wondering what other people here have done if you were in this situation and what is typical... Congratulations! It's very exciting to be able to acquire something t...
by lhl12
Wed Apr 13, 2022 4:55 pm
Forum: Personal Investments
Topic: State tax liability for a trust
Replies: 1
Views: 321

State tax liability for a trust

My FIL died in 2020, leaving a wife and three children. FIL lived in TX (as does widow) while children live in three other states (CA, NM and my wife in MA). Most assets were in MIL’s name at time of death, with primary exception being a life insurance policy held in an irrevocable trust. My wife was the longtime trustee of the trust and continued as trustee upon death of her father and payout of insurance policy. The primary beneficiary of the trust is my MIL for the remainder of her lifetime, then the three children upon her death. The sole asset of the trust was the policy, whose premiums were funded through annual gifts during my FIL’s lifetime. The payout upon his death was about $1.1 million. Proceeds of policy were invested in a seri...
by lhl12
Sun Feb 06, 2022 6:18 am
Forum: Personal Consumer Issues
Topic: TSA Pre-Check, Global, Entry, or TSA Clear?
Replies: 62
Views: 8530

Re: TSA Pre-Check, Global, Entry, or TSA Clear?

Both Global Entry and Pre-check are US Government products. Clear is a private company. I haven’t used Clear but my understanding is that by paying more (some portion of which the company presumably shares with the airport), you get your own separate line for Clear users only. If you travel a lot at airports that have long security lines even for Pre-Check then Clear effectively allows you to “cut the line” for an extra fee. It’s another mechanism for segmenting the market for security lines and allowing wealthier travelers who are willing to pay more to save more time. Think of no Pre-Check as Coach, Pre-Check as First Class, and Clear as First Class with lie-flat seats and unlimited champagne. Global Entry is a different animal - used for...
by lhl12
Sun Jan 23, 2022 8:13 am
Forum: Personal Consumer Issues
Topic: Favorite Productivity "Systems," Apps, etc.
Replies: 30
Views: 3164

Re: Favorite Productivity "Systems," Apps, etc.

“Take back your life!” From McGhee Productivity - oriented around Microsoft Outlook.
by lhl12
Wed Dec 29, 2021 11:45 am
Forum: Personal Consumer Issues
Topic: Recommendation for 17-inch Laptop
Replies: 47
Views: 3871

Re: Recommendation for 17-inch Laptop

I have a Razer Blade Pro, which is excellent (but NOT cheap). I have vision issues so 17" with the best possible graphics was important to me.

My one complaint is that the keyboard doesn't have a numeric keypad. Otherwise I think it's a fabulous machine.

I tend to upgrade every 3 years and am due roughly one year from now. If I were to upgrade today the LG Gram (which others have recommended) looks quite interesting since it has the numeric keypad. However I haven't seen one in person (thereby testing the graphics) yet.
by lhl12
Sun Dec 19, 2021 6:25 am
Forum: Personal Consumer Issues
Topic: TV Streaming Service- YouTube TV alternative
Replies: 46
Views: 5016

Re: TV Streaming Service- YouTube TV alternative

I suggest Hulu with Live TV. It’s worth noting that this is exactly what Disney is hoping people will do. For that reason, I’d personally try to find another acceptable alternative like Sling or Fubo (or just living without those channels) while this gets sorted. I think this is exactly right. Since Hulu is owned by Disney, they are hardly disinterested here. If lots of YTTV users keep switching to Hulu then this dispute may never settle. Unlike most negotiations of this sort Disney is not disinterested and doesn’t have the same incentives that it normally would, I am pessimistic this will settle any time soon and the last thing I want to do is to reward Disney by forcing me to switch from YTTV, which I think is great, to something inferio...
by lhl12
Sat Nov 27, 2021 4:39 am
Forum: Personal Consumer Issues
Topic: Please recommend a 34" or 38" inch Ultrawide monitor primarily for spreadsheet use
Replies: 39
Views: 7998

Re: Please recommend a 34" or 38" inch Ultrawide monitor primarily for spreadsheet use

I have gone steadily bigger with the Dell UltraSharp curved monitors since they first came out and will never go back. I’ve found the 38” to be the best size for me - anything bigger is too big.
by lhl12
Sat Sep 04, 2021 2:19 pm
Forum: Personal Finance (Not Investing)
Topic: MIL wants me to take on whole life policy for her 28yo daughter (my SO)
Replies: 90
Views: 10437

Re: MIL wants me to take on whole life policy for her 28yo daughter (my SO)

Some information that would be would be helpful to have when you discuss the policy with her: 1. What is the current cash value of the policy? (i.e., If the owner surrendered the policy right now, how much cash would they receive and how much income tax, if any, would they owe on that surrender) 2. Who is the current owner of the policy? I assume your MIL owns it individually but she should confirm. 3. Is your MIL willing to gift ownership of the policy (together with its cash surrender value) to whomever she wants to take on the payments? Depending on the cash value, this might be a good deal 4. If the owner of the policy were to continue to make the premium payments for some number of years and then stop, how many years would it take befo...
by lhl12
Sat May 15, 2021 8:20 am
Forum: Personal Consumer Issues
Topic: Visiting Boston w/ young family
Replies: 35
Views: 4037

Re: Visiting Boston w/ young family

MikeZ wrote: Fri May 14, 2021 9:14 am One fun game to play with kids: Who can spot the most Dunken' Donuts.
This is actually a great idea!
by lhl12
Fri Apr 30, 2021 9:56 am
Forum: Personal Investments
Topic: Roth-IRA conversion for 83 year old widow?
Replies: 66
Views: 6113

Re: Roth-IRA conversion for 83 year old widow?

I understand well what is trying to be achieved here. A bit late, but better than never. Rather than try to come up with a complicated conversion plan, I'd use the top of the IRMAA bracket as my target. Look at her MAGI and if it's below $88K, convert enough from the TIRA to a Roth to hit $88K MAGI. Here's the medicare part B brackets: https://www.medicare.gov/your-medicare-costs/part-b-costs As can be seen from each IRMAA bracket, they're 1) small brackets until you get above $165K MAGI, and 2) the rates go up quickly with each successive bracket. Those are monthly Part B costs, by the way. This discussion just reemphasizes to me how beneficial it has been to convert all of my IRA and 401k to Roth. I'm 60, wife 53, 2 military pensions tha...
by lhl12
Wed Apr 28, 2021 10:47 am
Forum: Personal Investments
Topic: Roth-IRA conversion for 83 year old widow?
Replies: 66
Views: 6113

Re: Roth-IRA conversion for 83 year old widow?

This is how I would think through the two options of convert now vs later: Convert Now: Between her RMD (which I assume is around $40k) and any social security or other fixed income, I assume she is in the 22% tax bracket. So any conversion she does now would either require a 22% tax or 24% tax, depending on how much is converted each year. Convert Later: This is more complicated and depends on the financial situation of each beneficiary. If the two surviving children are nearing retirement and are going to be in a window for a few years between retirement and social security where they can do conversions at a lower bracket than 22%, it might make sense to let them do the conversion later. If that is possible, they would pay 12% plus state...
by lhl12
Wed Apr 28, 2021 8:44 am
Forum: Personal Investments
Topic: Roth-IRA conversion for 83 year old widow?
Replies: 66
Views: 6113

Re: Roth-IRA conversion for 83 year old widow?

Unless I'm not fully understanding your example, it seems the benefit is mostly to the heir and not necessarily to the widow. Essentially pre-paying someone else's taxes. Nothing wrong with that if that is the goal. I agree that the benefit is mostly (if not entirely) to her heirs, not to herself. She is confident that she will not outlive her money and so her objective (on which she requested my input) is to maximize the ultimate, net, after-tax inheritance she leaves. The question I am struggling with is: where is the breakeven point at which the benefits of a conversion outweigh the costs (probabilistically speaking)? If I can identify the levers that impact the decision most significantly then she can make a better informed judgment.
by lhl12
Tue Apr 27, 2021 9:11 am
Forum: Personal Investments
Topic: Roth-IRA conversion for 83 year old widow?
Replies: 66
Views: 6113

Re: Roth-IRA conversion for 83 year old widow?

grabiner wrote: Mon Apr 26, 2021 9:10 pm She comes out ahead at the same tax rate, because the Roth effectively tax-defers more money, and because RMDs force money out of the account.
Exactly. Furthermore, although we don't know for sure it's hard to imagine that tax rates don't go higher over the next 20 years as well. My instinct is that converting in full to a Roth-IRA as soon as possible is the best strategy, but I am trying to put some rigor behind that instinct. In particular, under what circumstances (mathematically speaking) would a conversion be a bad decision in hindsight?
by lhl12
Sun Apr 25, 2021 5:47 pm
Forum: Personal Investments
Topic: Roth-IRA conversion for 83 year old widow?
Replies: 66
Views: 6113

Re: Roth-IRA conversion for 83 year old widow?

Katietsu wrote: Sun Apr 25, 2021 5:39 pm This is why others have advised you that there is no simple rule of thumb answer for the situation that you have described.
I understand there is no simple rule of thumb answer and I have not asked for one. I am looking for a framework to help do a reasonable analysis of the two options. Doing nothing (i.e. leaving the funds in Traditional) is making a decision and it may be a bad one - I'm not sure.
by lhl12
Sun Apr 25, 2021 5:27 pm
Forum: Personal Investments
Topic: Roth-IRA conversion for 83 year old widow?
Replies: 66
Views: 6113

Re: Roth-IRA conversion for 83 year old widow?

Converting the monies now is worse than RMDs, the RMDs would be gradual and the tax you haven't paid on the account would still be earning investment income. By converting everything now, you are paying ALL of the federal income tax up front. The investment earnings on your diminished ROTH balance most likely cannot make up for the cost of the up front income tax paid and subsequent 10 to 20 years loss of investment earnings on that tax (which would have been paid to the federal government over time, not in one lump sum triggering all types of extra "taxes"). This is incorrect. The tax would be paid from capital already in taxable space. The Roth balance would not decline (as the Traditional balance would if not converted). This ...
by lhl12
Sun Apr 25, 2021 5:14 pm
Forum: Personal Investments
Topic: Roth-IRA conversion for 83 year old widow?
Replies: 66
Views: 6113

Re: Roth-IRA conversion for 83 year old widow?

water2357 wrote: Sun Apr 25, 2021 5:00 pm And if this is truly for estate planning and in the best interests of the widow, then hire a certified elder lawyer.
We have already consulted her estate planning attorney (who is excellent). He advised us that this is a financial question, not a legal one. That is why I have come here.
by lhl12
Sun Apr 25, 2021 4:41 pm
Forum: Personal Investments
Topic: Roth-IRA conversion for 83 year old widow?
Replies: 66
Views: 6113

Re: Roth-IRA conversion for 83 year old widow?

delamer wrote: Sun Apr 25, 2021 4:38 pm
lhl12 wrote: Sun Apr 25, 2021 4:32 pm
delamer wrote: Sun Apr 25, 2021 4:28 pm Where would she get the money to pay the additional taxes?
She has substantial additional assets in taxable space from which she would pay the taxes. She is well off financially and doesn't need the RMD's.
So a conversion wouldn’t reduce her IRA assets, but it would reduce her taxable assets.

Leaving less taxable dollars for the heirs.

So a tradeoff.
Yes, it's a tradeoff. The whole point of this thread is a request for help evaluating the tradeoff.
by lhl12
Sun Apr 25, 2021 4:32 pm
Forum: Personal Investments
Topic: Roth-IRA conversion for 83 year old widow?
Replies: 66
Views: 6113

Re: Roth-IRA conversion for 83 year old widow?

delamer wrote: Sun Apr 25, 2021 4:28 pm Where would she get the money to pay the additional taxes?
She has substantial additional assets in taxable space from which she would pay the taxes. She is in good shape financially and doesn't need the cash flow from the RMD's. This is really an estate planning question for her.
by lhl12
Sun Apr 25, 2021 4:02 pm
Forum: Personal Investments
Topic: Roth-IRA conversion for 83 year old widow?
Replies: 66
Views: 6113

Re: Roth-IRA conversion for 83 year old widow?

You could model various levels of Roth conversion using one or more of the financial models noted in the Wiki, Roth conversion. One model is the free I-orp available at www.I-orp.com. For a useful scenario you will need all of the detail on your friend’s financial assets, expenses, expected mortality, etc. After running various scenarios (10% conversion, 25% conversion, etc.), compare the no Roth conversion base case to the others with attention to the spendable assets at end of model term. You will also see columns for federal taxes, IRMAA premium impacts, etc. The model result is highly dependent on the expected ROI of assets in the traditional IRA and taxable accounts. A caution that some I-orp users find the model aggressively pushes R...
by lhl12
Sun Apr 25, 2021 3:59 pm
Forum: Personal Investments
Topic: Roth-IRA conversion for 83 year old widow?
Replies: 66
Views: 6113

Re: Roth-IRA conversion for 83 year old widow?

allenr wrote: Sun Apr 25, 2021 3:46 pm You're taking a definite tax hit now on the bet that tax rates will possibly increase in the near future.
Rising tax rates in the future is not the only possible benefit. Another is the benefit of allowing the money to continue to compound tax-free for the remainder of her lifetime and for ten years following her death instead of pulling much of it out through RMD's.
by lhl12
Sun Apr 25, 2021 3:55 pm
Forum: Personal Investments
Topic: Roth-IRA conversion for 83 year old widow?
Replies: 66
Views: 6113

Re: Roth-IRA conversion for 83 year old widow?

diy60 wrote: Sun Apr 25, 2021 3:36 pm Just my opinion, but doing Roth conversions at 83 is equivalent to prepaying taxes for their heirs.
I agree, but I don't think it's quite that simple. For example, even if her Federal tax rate is a little higher than her heirs', the fact that she pays no state income taxes and they do might offset it. Also, even if her tax rate is higher, it might be worthwhile to pay that extra tax now in exchange for tax free compounding for the next 20 years (if we assume that she lives another ten years and her heirs then get ten more before they need to withdraw).
by lhl12
Sun Apr 25, 2021 3:31 pm
Forum: Personal Investments
Topic: Roth-IRA conversion for 83 year old widow?
Replies: 66
Views: 6113

Re: Roth-IRA conversion for 83 year old widow?

I appreciate the responses, but they aren't answering the question I am asking. As I understand it, the economic tradeoff for her is that by doing the conversion she could pay income tax now and create a tax-free (not tax-deferred) pool of capital that will last her entire lifetime AND ten years following her death in the hands of her heirs (which is what she is especially focused on). And, her conversion now would pay only Federal income tax while her heirs would have to pay state income taxes on distributions. Also, tax rates are probably going up, not down, over the next 5-10 years (although that is obviously speculative). I am asking for input only on this narrow economic question - please do not give responses that bring in elder care ...
by lhl12
Sun Apr 25, 2021 2:25 pm
Forum: Personal Investments
Topic: Roth-IRA conversion for 83 year old widow?
Replies: 66
Views: 6113

Re: Roth-IRA conversion for 83 year old widow?

It is obviously impossible to know what tax rates "will be", or how long she will live. This decision needs to be made with a fair amount of uncertainty, therefore probabilistically. I'm trying to understand the tradeoffs, or what would need to be true for the conversion to be clearly a good (or bad) decision.
by lhl12
Sun Apr 25, 2021 2:07 pm
Forum: Personal Investments
Topic: Roth-IRA conversion for 83 year old widow?
Replies: 66
Views: 6113

Roth-IRA conversion for 83 year old widow?

Husband (a good friend) died about a year ago and I have been helping with finances. Widow is 83 - in good health, generally long-lived family history. Widow is well provided for - current draw rate of about 4% against financial assets with room to cut spending if necessary and home mortgaged at about 1/3 of value (at 2.5%). She will probably go into some sort of retirement community in the next 5-10 years, so the home will get sold and equity added to financial assets. Spending will probably decline over time as well. Financial assets include Traditional IRA worth $700K. What is the calculus for converting her Traditional IRA to a Roth-IRA (and paying associated taxes) at this stage of her life? She is currently taking RMD's so with the co...
by lhl12
Sun Apr 11, 2021 9:06 pm
Forum: Personal Finance (Not Investing)
Topic: In-Laws' HOA demanding $8000 lumpsum payment
Replies: 91
Views: 12208

Re: In-Laws' HOA demanding $8000 lumpsum payment

A real estate broker who becomes an agent of a seller or buyer, either intentionally through the execution of a written agreement, or unintentionally by a course of conduct, will be deemed to be a fiduciary. https://www.nar.realtor/sites/default/files/handouts-and-brochures/2014/nar-fiduciary-duty-032213.pdf Here's the narrative from the article linked to: "A duty of loyalty is one of the most fundamental fiduciary duties owed by an agent to his principal. This duty obligates a real estate broker to act at all times solely in the best interests of his principal to the exclusion of all other interests, including the broker’s own self-interest." My reading of this suggests that the fiduciary duty of a buyer's agent is to the BUYER ...
by lhl12
Sun Apr 11, 2021 3:50 pm
Forum: Personal Finance (Not Investing)
Topic: In-Laws' HOA demanding $8000 lumpsum payment
Replies: 91
Views: 12208

Re: In-Laws' HOA demanding $8000 lumpsum payment

The facts are incomplete, but based on what I've read I think it unlikely your in-laws would have a claim against the real estate agents. Both the seller's broker and the buyer's broker get paid by the seller and have a fiduciary duty to the seller. Neither agent owes a duty to the buyer. If there is a claim, I think it would be against the seller for not having disclosed the issue. However it's unclear whether that's the case without reading the contract. If the seller disclosed the issue then the buyer should have built in language keeping the seller on the hook for any assessment (since the seller can make a claim against their insurance company). If the buyer didn't do that they they are on the hook for the $8,000 (with the possibility ...
by lhl12
Sun Apr 04, 2021 1:33 pm
Forum: Personal Finance (Not Investing)
Topic: Claiming SS early or late for non-representative sub-populations
Replies: 14
Views: 1437

Re: Claiming SS early or late for non-representative sub-populations

Assume 76 for a man and 81 for a woman is the National average, so 74/79 in Arkansas and 78/83 in Mississippi.
by lhl12
Sun Apr 04, 2021 1:24 pm
Forum: Personal Finance (Not Investing)
Topic: Claiming SS early or late for non-representative sub-populations
Replies: 14
Views: 1437

Claiming SS early or late for non-representative sub-populations

Let’s imagine that every person born in Arkansas has a life expectancy two years shorter than average and every person born in Mississippi has a life expectancy two years longer than average. (I picked those two states solely because they are roughly equivalent in population).

Ignoring the “longevity insurance” benefit of delaying claiming SS, and assuming actuarial neutrality on all other factors, am I correct that under this (obviously absurd) hypothetical, all Arkansans should claim SS at the earliest possible opportunity, all Mississippians should claim at the latest possible opportunity, and everyone else is actuarially indifferent?
by lhl12
Tue Mar 30, 2021 8:31 am
Forum: Personal Consumer Issues
Topic: High spenders what do you spend on?
Replies: 257
Views: 32868

Re: High spenders what do you spend on?

beernutz wrote: Mon Mar 29, 2021 6:12 pm
sailaway wrote: Mon Mar 29, 2021 6:11 pm
beernutz wrote: Mon Mar 29, 2021 6:09 pm I am not a high spender but imo if you want to run through dollars like candy then buy a boat.
And here I deleted my boat post because our total annual spend has never been over $120k and averages in the mid $60k range, putting us well below OP's targets.
There are boats and there are boats.
I wish I know who said it, but "owning a large sailboat is equivalent to standing under a cold shower fully clothed while ripping up thousand dollar bills".
by lhl12
Sat Mar 27, 2021 2:59 pm
Forum: Personal Finance (Not Investing)
Topic: National Reputation of Worcester Polytechnic Institute (WPI)? other input welcome too
Replies: 211
Views: 20768

Re: National Reputation of Worcester Polytechnic Institute (WPI)? other input welcome too

As one poster said the winters are long and cold in north east. The Northeast is not California, weather-wise. However climate change has definitely been working in the Northeast's favor. In my experience, true winter in the Northeast is now really only two months (January and February) while 30/40 years ago I would have said it was three and a half months (early December through late March). These days December is great - first snow of the year (maybe), holidays, still exciting and fun when it begins to get cold but lots of days that are in the 50's. And by March it's already much warmer and brighter. Today (3/27) is spectacular -- low 60's, bright, sunny and beautiful. January and February are cold and dark - I actually think the lack of...
by lhl12
Tue Feb 23, 2021 5:39 pm
Forum: Personal Consumer Issues
Topic: Pool Automation using Phone App
Replies: 11
Views: 1106

Re: Pool Automation using Phone App

I added wifi connectivity (and iPhone control) to a 15-year old Jandy Aqualink. It was not cheap because they had to upgrade my Aqualink processor (since it was so old). However it worked great - a definite improvement over the keypad on the wall. If you're OK with the cost, I definitely recommend it (although there is no Siri interface - it's basically just an iPhone implementation of the keypad on the wall).

I believe the product name is "iAquaLink 2.0"