Bogleheads.org

Darth Xanadu wrote: ↑Thu Mar 30, 2023 1:58 pm My taxable brokerage account hit the $500k mark; about 1/3 of it is unrealized gains. I first opened and started contributing in 2015, so I've been the beneficiary of some big returns.

And while arbitrary in and of itself, it's important to me because it sets me up to manage my tax liabilities efficiently, down the road in the decumulation stage.

Congrats! We are also fortunate to have accumulated a sizable taxable account, and expect it to provide some great flexibility in the future.

Great to read these celebratory posts! I will make one once we reach a portfolio ATH again. Even shoveling in as much as possible has left us down a bunch since 2021. It’ll come, it’ll come.

Wannaretireearly wrote: ↑Tue Mar 21, 2023 2:11 pm

MrJedi wrote: ↑Tue Mar 21, 2023 7:23 am The ironic thing is that people generally want their taxable accounts to give off LESS dividends to protect from dividend tax drag every year.

I want taxable dividends to make up my non-discretionary spend when i retire. Let's see if i can get close. Who knows - currently around $20k a year, $40k a year would be great imo.

Not me, I would rather be (more) in charge of my tax situation. But, since we will be close to 98% in VTSAX in taxable by retirement, it will be what the market gives and we will roll with it.

kchico wrote: ↑Tue Mar 21, 2023 7:27 pm

rob wrote: ↑Tue Mar 21, 2023 7:16 pm I don't see any way this works to be honest....

So Bogleheads don't use the 4% SWR?

Not for folks in their late 30s. That’s a very long retirement.

Absolutely not. Any shirt I have ended up with that comes out of the dryer wrinkled, gets donated. Iron has not been turned on in many years, and no way would I drop a shirt off for cleaning.

I wear standard looking long sleeve dress shirts with a short sleeve white tee shirt underneath.

I’d say a risk is that you don’t know what your actual expenses are or will be compared to what you will qualify for from the SSA. Not saving for retirement seems severely irresponsible. Both to you, to your spouse, and especially to your kids.

If you can save, I can come up with no reason why you wouldn’t, and about a hundred as to why you should.

sailaway wrote: ↑Thu Mar 16, 2023 1:14 pm

TheTimeLord wrote: ↑Thu Mar 16, 2023 12:34 pm What are retirees who "over saved" doing with funds in excess of their needs besides donating to kids and charities?

We are only semi retired because DH has decided he really wants to splurge on a big want: a new boat. And not just new to us.

Well that’ll do it for sure. Your “over saving”, OP's “over saving” your neighbor’s “over saving”, plenty of room in the water for all of it.

Artful Dodger wrote: ↑Thu Mar 16, 2023 1:18 pm …
Concerts - Pop, Rock, Classical, Symphony
Upgraded memberships to the art museum, botanical garden
…

I like this, sort of what you do, only do it at a higher level or more often.

I think I perhaps do not fully understand the 4% SWR. In my current understanding, you withdraw 4% of your net worth during the first year of retirement, and then ideally your net worth continues to grow faster than inflation during the following years, so your expenses slowly become a smaller and smaller percentage of your net worth, as long as your return on investment remains larger than your expenses. Of course, as others have pointed out in this thread, during market decline your net worth may actually be decreasing, so the greater your safety margin, the better. As for expense ratio, my current understanding is that expense ratio is identical to a decrease in your return on investment. So if you would have had a 5% return on investme...

stan1 wrote: ↑Wed Mar 15, 2023 6:30 pm
But I also think the "swing bar" and peephole on most US hotel doors is sufficient.

If someone unexpectedly knocks on the door don't open it.

This what my spouse does when traveling alone (and I do, and of course when together we do).

I don’t even answer my home door when it is unexpected. Which basically means it’s never answered unless the UPS person needs to hand me a wine shipment.

I think I see what you're getting at, just as a way to visualize how large a 1% expense ratio is. But, if you're still making a 5% return even after the expense ratio, you can still live on 4%. It's not like you actually subtract the ER from your withdrawal; you subtract it from your return on investment, which hopefully still covers your 4% withdrawals. No. If you view it like that “…can still live on 4%,,,” then the framing is perhaps clearer another way. Making 5% in order to live on 4% means you need to make 25% more (4 to 5 is 25% increase) on your investments over your entire career to make it. If any of us had an opportunity to lock in 25% returns over an investment career, this board would cease to exist because we would all be on ...

How to calculate the effect of expense ratio on retirement savings? I don't know it it was mentioned year but there is another way to look at the importance of expense ratios AFTER you retire. There are all sorts of important assumptions and qualifications but academic studies have shown that in the past a 65 year old would be relatively safe starting out with about a 4% "safe withdrawal rate"(SWR). There is a wiki on that. https://www.bogleheads.org/wiki/Safe_withdrawal_rates#top-page The problem with that and the expense ratio is that when you are retired the expense ratio needs to come out of that 4% SWR. For example if you had a mutual fund with an expense ratio of 0.6% then you could only spend 3.4% as your SWR instead of 4%...

…A friend just had a catalytic converter theft on a diesel today. Minimum cost will be $8,500 to replace it. Insurance agent was contacted and it seems they may total the vehicle. :shock: TIA. Diesels don’t have a catalytic converter. They do have a diesel particular filter (DPF), which serves a similar purpose. If you’re worried about catalytic converter theft, the first thing I would do is look under your car for the converter and see how accessible it is. On some vehicles, like a Jeep Wrangler, it’s extremely difficult to reach the engine side of the converter, so thieves don’t bother with Wranglers. If you don’t fall into that category, the best and easiest device to install I’ve seen is a steel cable contraption that goes around the c...

Our second DIY individual equities portfolio got started in 2003. All dividend stocks in the taxable account. We only had two years of declining income in all these years and that was 2010 and 2012. Not a big deal. I did some shuffling of assets in the portfolio. Other than that, income from dividends keeps increasing. Up 11.8% in 2022 compared to the previous year using combined savings and cash from dividends to reinvest and that's in retirement. I never got pay raises like that when I was a working stiff, so I have no complaints. If others want to live off capital gains in retirement, I've seen it done. Just not my interest. I plan to live off total return in retirement. That’s my interest for sure. An even bigger interest is only worki...

Aslan18 wrote: ↑Sun Mar 12, 2023 8:02 am The market is going to be a blood bath tomorrow and VTSAX has major tech exposure.

Irresponsible fear mongering from my seat.

lakpr wrote: ↑Fri Mar 10, 2023 4:39 am I had done the recasting with a $250 fee when I had the mortgage on my home, back in 2014 and the interest rate on my mortgage was 4.75%. It is a small bank here in NJ, so it is not even a large national bank like Wells Fargo or Chase.

We did it last year with our credit union. No fee, just a recalculation of our payment. I asked before taking the loan since we were still working on selling our paid off home.

HenryG wrote: ↑Thu Mar 09, 2023 10:47 pm I would use VTI in your situation.
Avoid target date funds in taxable as periodic rebalancing within the fund might create unexpected taxable events.

This is our solution (VTSAX but close enough).

Good job OP getting to this point.

Northern Flicker wrote: ↑Wed Mar 08, 2023 5:21 pm Thanks. I liked the term they use for sequence of return risk with regular withdrawals: dollar cost ravaging.

Yeah, I noticed and liked that also.

StevieG72 wrote: ↑Mon Mar 06, 2023 3:57 pm My daughter has been giving specific instructions to not allow my friend to handle these arrangements as he will simply flush my ashes down the toilet claiming I will get there eventually!

People who have these kinds of friends tend to be people I want to hang with. Everyone should be so lucky as to have a frined like that.

Time and comfortable surroundings for stories, those have been the best aspects of funerals.

Set up auto payments. I’d prefer that over pushing for more online prowess.

And she might be using the same bank as me, so paperless saves me money, as does automatic payments.

SevenBridgesRoad wrote: ↑Sat Mar 04, 2023 7:33 pm

sandburg wrote: ↑Sat Mar 04, 2023 1:37 pm Getting lots of nominations from the US Western States (even the out-of-scope Hawaiian recommendations). Thought I'd hear about other lake sunset perches (Great Lakes or other inland lakes).

Ludington, Michigan

The next morning, after watching that sunset, take the car ferry from Ludington across Lake Michigan to Manitowoc, WI. Because you can.

https://www.ssbadger.com

Watching the sun set over the dunes at Silver Lake is also nice. You can then hop in a vehicle and dash out to Little Point Sable and catch it setting again on the lake. Two for one.

Lots of cool places on the east shore of Lake Michigan.

This is a simple question for me to answer. 100% into VTI. Why? Takes no thought, would likely throw off dividends well in excess of what we need to live on. I’d pay the taxes needed each year without complaint, and simply move on with a life filled with fulfilling activities. I don’t have an answer for the bonus points question. I don’t worry much about taxes in general, I pay them and move on. If I had 16.7 million bucks invested, I am going to optimize my life for fulfillment, not taxes. If you were in top bracket, why would you want dividends exposure? That gets taxed as ordinary income. Easy. We are in the bottom of the 35% bracket today and dump over $9,000 on average each month into our taxable account (all VTSAX). And live a pretty...

I hope the OP takes this barrage as motivation to read some credible sources of investment education (the wiki on this site is a great source, and a great source of sources.) Then make sound decisions and enjoy some long term success.

OP, a lot of us ran in all sorts of directions for 1, 5, 10 years and more. There are many different strategies we have settled on, but most started with quality education.

Good luck, do some reading, and this community is always here for questions.

This is a simple question for me to answer. 100% into VTI. Why? Takes no thought, would likely throw off dividends well in excess of what we need to live on. I’d pay the taxes needed each year without complaint, and simply move on with a life filled with fulfilling activities.

I don’t have an answer for the bonus points question. I don’t worry much about taxes in general, I pay them and move on. If I had 16.7 million bucks invested, I am going to optimize my life for fulfillment, not taxes.

I’ll throw out Fidelity as good choice.

Dave9729 wrote: ↑Thu Mar 02, 2023 3:31 pm Thanks Mountain Doc. I invested some money a couple days ago and debated between splitting it into large, mid, and small. I feel a bit better now.

A couple days ago and you were briefly concerned? VTI is appropriate for five years at the very very very shortest timeframe. Buy and forget for a decade and I dare you to find this quirk on a chart.

It really is a mental conditioning thing that I always try to mention to folks looking a short term disturbances. I bought six figures of total stock in Dec 2021. Those shares need some time to ripen, but I have every confidence they will be in good shape in 2050 or so when I (might) need them.

chuckwalla wrote: ↑Thu Mar 02, 2023 12:24 pm If you like the watch, fix it, else chuck it.

I’d probably list for sale at a very reasonable price instead of a chuck. Some amateur watchmaker would likely love to have it for dimes on the dollar.

22k property taxes on a 3.1-million-dollar house looks low to me. I pay 10K on a 500K house in the Midwest. Yeah, that caught my eye also. Envious of that rate. We are at $13k on a $640k house, also in Midwest. I would be very nervous with taking on that level of debt, but if I was to check our first house, I bet the ratios wouldn’t be exceptionally far off. Your numbers seem high to me, and I'm also in the Midwest. I'm in Minnesota and property taxes are less than $10k/year on a $750k house. Jealous, especially without kids in school (I know we still benefit indirectly from good schools, but still). In the Des Moines area. They do something called rollback, which last year was 55%. So assessed value times rollback equals taxable value. Th...

oldmotos wrote: ↑Wed Mar 01, 2023 8:29 pm 22k property taxes on a 3.1-million-dollar house looks low to me. I pay 10K on a 500K house in the Midwest.

Yeah, that caught my eye also. Envious of that rate. We are at $13k on a $640k house, also in Midwest.

I would be very nervous with taking on that level of debt, but if I was to check our first house, I bet the ratios wouldn’t be exceptionally far off.

Just under two weeks for federal, still waiting on state. After a couple back to back years with corporate relocations which really messed with things and had us cutting large checks, we played defense in case it would happen again. Naturally it didn’t, and a legacy holding that normally throws off $15k to $25k in distributions, threw off about $2200. So we had a large refund. Already redid the W4 to remove some of the extra withholding, and we don’t expect a relo this year (90% confidence). That should bring us really close to even this year, depending on distributions.

VTSAX is not tech heavy. The market is tech heavy, so naturally anything that tracks it will be tech heavy. If the market becomes AI heavy, or buggy whip heavy, or whatever, it will be reflected in a fund like VTSAX. And that is exactly why I hold seven figures in it, and dump more in each and every month.

ruralavalon wrote: ↑Mon Feb 27, 2023 1:44 pm

Morgi87 wrote: ↑Mon Feb 27, 2023 10:15 am
. . . . .

How do most of you invest and spread any extra cash savings you have?

I have simply bought more shares of Vanguard Total Stock Market Index Fund (VTSAX) ER 0.04% in a taxable brokerage account.

Same for us. A regular monthly investment and then another, normally larger, in December or January after bonuses are paid and we do some year end accounting. But it all simply goes into VTSAX.

https://www.irrigreen.com/


I would investigate that if I was starting from scratch and the concept fit my yard.

That otolawn thing looks very interesting after my five second scan.

USAA, will hit 30 years with them this summer. I stay because they provide me with good service. No reason to change that I can see.

We also have an account with a credit union somewhat affiliated with our employer. Work with them because they are tied into our relocation (though they are also super responsive with things and have way better short term rates compared to USAA, a low bar). Takes a lot of hassle out of relocation for us. They also have demonstrated a wonderful flexibility with mortgages over the years.

My parents have never mentioned anything about their situation except “we have plenty”, and that’s plenty for me to hear, amd I did not respond in kind with any indication of where we are.

I don’t talk to any other of my family members. Spouse’s family seems to tease around the edges sometimes, but I am not really interested. We live a ten hour drive away and only see them a couple times a year. Most stuff discussed is purged from my mental files when I clear their state if not sooner.

Of course at some point in future some of those curtains will come down for a moment. Until then as long as they don’t ask me for money everything will be fine.

I wouldn’t buy that to purposefully store for fifteen years, but neither did you. What matters now, the only thing that matters, is if you give it a yum or yuck. You gave it yum, so be thankful and raise your glass.

Forget the tax form, what does your transaction history say?

Are you sure you are only looking at VTSAX amounts?

I think OP must be playing with some AI bot (heavy on the A, low on the I).

But to answer, the markets are a gamble, but way less of a gamble than simply getting out of bed each morning. Way less then many many facets of life. Things are needed by humans, and that will drive something being made and sold. As noted, broad index funds will capture that.

Poor OP. So much bad advice confidently stated. (Mine included likely)

Good luck. As stated early on, no need to rush into anything. Read that wiki entry. Figure out who on here knows what they are talking about.

I would put $200k in a CD (emergency fund), spend $40k max on a vehicle, and the rest to VTSAX (vanguard total stock). Then I would get on with getting my life started. Future 401k dollars into a bond fund. Continue living life and enjoying it.

Whatever led me to decide to change would have been done with a long term view (at least it would between now and forty years from) and thus #3.

I just started directing a part of my 401k contributions into a US bond fund. It was going into a target date fund with 30% bonds, so a small change. I used to go in once a year and shift some money to balance our overall allocation. But I have found that to make me uncomfortable with some stress from analysis paralysis (I am fully addicted to buying equities and clicking otherwise is no fun). We just increased our monthly taxable investment due to pay increases, and all that goes into Vanguard Total Stock. Decided it made sense to start dribbling some monthly into the bond fund. I will still need to maneuver some dollars come December in all likelihood to rebalance.

I assume the poor OP is not wading through all this…

We tend to approach 35% or so of gross, and that gets us past the KF bar. Only count what goes into taxable equity and 401k and HSA. Nothing fancy. Puts us in the 1/3 in taxes, 1/3 in savings, and 1/3 in spend range.

Thinking back it was probably 10% max in the first five years, then maybe up 15% for another five years, then approached 25% for a decade, then as the mortgage disappeared it rose to where we are now.

bradinsky wrote: ↑Tue Feb 21, 2023 6:59 am
If you drive on 4 lane roads or highways, the blind spot monitor works continuously. If you pass, or are passed by someone, the indicator is always visible. Unless you are one of the many that refuse to use your mirrors, you will know it quickly.

Oh, nice point! Actually it’s a great point, thanks.

My spouse shakes her head at me when I occasionally use a building’s windows when parking or leaving to do a quick indicator light check.

It makes driving safer pure and simple. Vehicles in your blind spot are easy to miss no matter how attentive you are. I wouldn’t buy any new car without this feature But, does it make it more dangerous for you and everyone one around you if (maybe when?) it stops working without you knowing? That’s the part that concerns me. I’d like to think there are diagnostics, but I work in the industrial vehicle area, used to work in the automotive area, and that area (electronics and software), in my opinion, is weakening not strengthening. I like the posters way up thread who talked about it being a belt and suspenders feature and nice to have a don’t bother after a glance. But others seem to imply they that if they don’t see the light they simply ...

I don’t understand the use case. I would never trust an electronic device and change lanes without looking. And as such, if I am going to change lanes, I am going to look anyway. Plus, you should have been watching your mirrors and surroundings and know someone was entering the zone anyway. But if it keeps people from running into me, I am all for it.

FriedOkra wrote: ↑Sun Feb 19, 2023 9:24 am Thank you, all, for the vote of confidence and the careful consideration of my questions. This makes me believe I can do this on my own without completely messing it up.

You can do it on your own, absolutely. First step as mentioned is big time simplification. Tear the bandage off and get it to a three fund portfolio (keeping the taxable in just a total stock index, there’s a wiki page on efficient fund placement). Then you can take all the time needed to get comfortable with any other steps. The next step might be “nothing, enjoy living”.

Good luck, don’t fret, get the basics down.

TheQuestionGuy wrote: ↑Sat Feb 18, 2023 6:56 am

Freeadvice wrote: ↑Sat Feb 18, 2023 6:49 am

TheQuestionGuy wrote: ↑Sat Feb 18, 2023 3:30 am

MotoTrojan wrote: ↑Fri Feb 17, 2023 4:09 pm $995 for Rick Ferri. You can find lots of podcasts and posts by him and see if his style fits you.

https://rickferri.com/investors/

He replied to my e-mail that he isn't the right person.

Did he say why?

Nope. Here is his reply....
I'm not the right person for this job. Good luck.

This sounds like clear feedback that cost you nothing. Quite the bargain.

And, of course, have you replaced the filter recently? (That’s the real first question)

The short answer is yes, there are things you can do. Need a lot more info, but I suspect you will need to try and find a trusted professional service provider to assist.

Is there warm air coming out the registers in the cold rooms? That might be the first question I would ask you. Then there are fifty more.

I will be very disappointed if my wealth (in terms of money…) goes up in retirement. I will set things up to avoid going to zero, but will plan to actually draw things down. If 20 years in I have more in real terms than when I retired, boy that would suck to think about all those wasted years going to work.

Also surprised you had detailed financials on both sets of grandparents going back 20+ years.

I am early 50s and have no plan to decrease HSA use. I have another couple hundred bucks to max for this year. Everything is at Fidelity in total stock index, where it will stay.

I currently have zero healthcare costs per year and have only accumulated maybe $1000 in reimbursable expenses over the last decade. That likely won’t continue for too many more years, but it would take a major shift to change my plan. Even if there was some sort of health change, I likely would cash flow it due to how valuable the HSA dollars are to me (for now.)

harvestbook wrote: ↑Tue Feb 14, 2023 7:24 am I wish they'd cut out this research and drop their expense ratios instead.

Shiny objects, shiny objects. This is 2023 and just the way things have unfortunately evolved.