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by retiredjg
Wed Nov 13, 2019 5:27 pm
Forum: Personal Investments
Topic: Getting comfortable with AA heading into retirement
Replies: 7
Views: 701

Re: Getting comfortable with AA heading into retirement

If you really like the mix that is in Wellington and Wellesley, you could have a combination of Target Retirement Income and Wellesley Income. Vanguard's target funds (the whole series) are recommended a lot. They may have more international than some people want. Mixing with Wellesley Income (about...
by retiredjg
Wed Nov 13, 2019 4:31 pm
Forum: Investing - Theory, News & General
Topic: Order or distributions on Roth IRA
Replies: 26
Views: 1737

Re: Order or distributions on Roth IRA

So If you have contribution money it's a contributory IRA. And you do a complete rollover to a Roth IRA, and then you add money from a 401k rollover, it becomes a rollover IRA? I don't think this would happen because a 401k rollover is going to go into a new IRA and they will name it a rollover iRA...
by retiredjg
Wed Nov 13, 2019 3:50 pm
Forum: Personal Investments
Topic: How much to convert from Trad-IRA to Roth
Replies: 11
Views: 603

Re: How much to convert from Trad-IRA to Roth

Other than the spousal benefits, my sole income is interest and dividends. In 2018 I had about $40,500 in interest and ordinary dividends. Just to be certain, are you saying that you will have NO qualified dividends? If you will, that changes everything and probably means you need a tax calculator ...
by retiredjg
Wed Nov 13, 2019 2:55 pm
Forum: Personal Investments
Topic: How much to convert from Trad-IRA to Roth
Replies: 11
Views: 603

Re: How much to convert from Trad-IRA to Roth

I am retired, single, not itemizing. I am receiving spousal benefits from SS but they were not taxable last year. That does not mean your SS will not be taxable in 2019, especially if you do a Roth conversion. Just the Roth conversion itself may make some of it taxable. My standard deduction last y...
by retiredjg
Wed Nov 13, 2019 1:58 pm
Forum: Personal Investments
Topic: Roth IRA Portfolio Options
Replies: 23
Views: 904

Re: Roth IRA Portfolio Options

Ok. That clears that up. My suggestion would be to put 5% - 8% of total portfolio (both accounts together) into the Vanguard REIT fund and put the rest of the Roth IRA into a target fund - maybe 2055 since you want to be aggressive. That would give you very broad diversification and a little extra e...
by retiredjg
Wed Nov 13, 2019 12:56 pm
Forum: Personal Investments
Topic: Roth IRA Portfolio Options
Replies: 23
Views: 904

Re: Roth IRA Portfolio Options

Is it possible when you said "15% emerging market bonds" earlier that you meant just "15% emerging markets"? Or maybe you think that "emerging markets" refers to bonds? Your account at Wealthfront - one place you called it a Roth IRA and one place you called it a "regular investment account". Which ...
by retiredjg
Wed Nov 13, 2019 12:01 pm
Forum: Personal Finance (Not Investing)
Topic: Retiring in early 2020, want to stuff preferred tax vehicles?
Replies: 12
Views: 688

Re: Retiring in early 2020, want to stuff preferred tax vehicles?

TresBelle65 wrote:
Wed Nov 13, 2019 5:33 am
Also, to make a Roth and possibly T-IRA contribution for 2020.
If you have never made a Roth IRA contribution, you should do that now. That will get your 5 year clock started so that your entire Roth IRA (not just part of it) is available to you immediately when you reach age 59.5.
by retiredjg
Wed Nov 13, 2019 11:49 am
Forum: Personal Investments
Topic: Asset Allocation advice
Replies: 4
Views: 259

Re: Asset Allocation advice

The funds you hold are important. But it is also important where you are holding them and we can't tell that from the information presented. See the link at the bottom of this post for how to give us a better picture of what your portfolio looks like. I agree that you are way over-weighted in emergi...
by retiredjg
Wed Nov 13, 2019 11:40 am
Forum: Personal Investments
Topic: Getting comfortable with AA heading into retirement
Replies: 7
Views: 701

Re: Getting comfortable with AA heading into retirement

Would this be a reasonable approach for a set it and forget it AA of 30/70 ? That's one way to do it. You would occasionally need to sell one and buy the other if/when the ratios get off. Have you considered just using 1 fund - Vanguard's Target Income fund? It's 30% stocks and 70% bonds and will s...
by retiredjg
Wed Nov 13, 2019 9:59 am
Forum: Personal Investments
Topic: IRA to 401K Roll In Rules, 60 Days, Vanguard Screw Ups
Replies: 10
Views: 244

Re: IRA to 401K Roll In Rules, 60 Days, Vanguard Screw Ups

It does not sound like you are facing a 60 day deadline. Sounds frustrating though.
by retiredjg
Wed Nov 13, 2019 9:46 am
Forum: Personal Finance (Not Investing)
Topic: Months Leading up to Retirement
Replies: 19
Views: 1660

Re: Months Leading up to Retirement

I have an appointment with our HR/retirement rep to get an explanation of the process. I am wondering if I should expect it to be unnecessarily complicated, given that most every other process in the agency falls into the category. Retirements can be scary but actually they are pretty simple. It's ...
by retiredjg
Wed Nov 13, 2019 9:41 am
Forum: Personal Investments
Topic: Is this too simple
Replies: 15
Views: 2076

Re: Is this too simple

I am going to retire next year and I am thinking of setting up a ladder of CDs for 5 years worth of my normal withdraw amounts ( thinking 3.5% of my total investment nest egg) and then just dropping the balance into VWENX. Is this way too easy? I have compared a lot of other mixes and honestly this...
by retiredjg
Wed Nov 13, 2019 9:28 am
Forum: Personal Investments
Topic: Investing $140k in cash at 1k per week
Replies: 117
Views: 6438

Re: Investing $140k in cash at 1k per week

If missing on returns is that big of a deal, then having a large portion of portfolio in bonds doesn't make sense because it is inferior (in terms of returns) to 100% stocks portfolio for 20+ years horizon. That is because you think that the only point of an asset class, such as bonds, is "returns"...
by retiredjg
Wed Nov 13, 2019 9:20 am
Forum: Personal Investments
Topic: Regular investing into taxable while maintaining AA
Replies: 11
Views: 739

Re: Regular investing into taxable while maintaining AA

Since your problem is solved with the REIT fund in the new 401k, I won't do a "makeover" suggestion. There are hundreds of ways you could set this up. I'll make a few suggestions to consider. Taxable 5% Vanguard muni funds (VWAHX and VTEB) 17.3% Vanguard Total Stock (VTI) and Schwab US Broad Market ...
by retiredjg
Wed Nov 13, 2019 8:42 am
Forum: Personal Investments
Topic: Regular investing into taxable while maintaining AA
Replies: 11
Views: 739

Re: Regular investing into taxable while maintaining AA

It’s not that important to use Vanguard TR fund for my new 401k. It actually turns out my new 401k does have Vanguard REIT fund! (not available in old 401k) I don’t want to roll over my old 401k into new 401k because new 401k has 0.15+ admin fee, whereas old 401k has none. Having REIT is probably m...
by retiredjg
Wed Nov 13, 2019 8:37 am
Forum: Personal Investments
Topic: Roth IRA Portfolio Options
Replies: 23
Views: 904

Re: Roth IRA Portfolio Options

Thanks to all of you I'd like to make some comments on the things you have posted. I hope you find them valuable. 1. Your 3 portfolio ideas in the original post are considerably different in terms of risk. Much of your portfolio risk is determined by the stock to bond ratio. Some is determined by t...
by retiredjg
Tue Nov 12, 2019 9:14 pm
Forum: Personal Investments
Topic: Roth IRA Portfolio Options
Replies: 23
Views: 904

Re: Roth IRA Portfolio Options

EDV = Vanguard Extended Duration Treasury ETF

I'm not familiar with this fund, but Vanguard ranks it as a 5 out of 5 on their risk scale. For that reason, it is not a good choice for your core bond allocation.
by retiredjg
Tue Nov 12, 2019 9:10 pm
Forum: Personal Investments
Topic: Roth IRA Portfolio Options
Replies: 23
Views: 904

Re: Roth IRA Portfolio Options

Hello, I need help to create my Roth IRA portfolio. You will get better help if you look at all of the savings you have/will have for retirement as one portfolio and tell us about all that you have. I get that you don't have a plan at work, but Roth IRA cannot make up your entire retirement portfol...
by retiredjg
Tue Nov 12, 2019 8:41 pm
Forum: Personal Investments
Topic: Regular investing into taxable while maintaining AA
Replies: 11
Views: 739

Re: Regular investing into taxable while maintaining AA

I'll have a look at it in the morning. In the meantime... -how important is it to you to use the target fund in the new 401k? It can be done, but some things are a little harder. -I don't suppose there is a REIT fund in the old 401k or the new 401k? -have you considered rolling the old 401k into the...
by retiredjg
Tue Nov 12, 2019 6:39 pm
Forum: Personal Investments
Topic: Roth IRA Rollover
Replies: 18
Views: 620

Re: Roth IRA Rollover

If you are not 59.5 then there is an immediate 10% penalty and likely taxes (depending on the various “clocks”). This is incorrect. No "clocks" apply, nor penalties and/or taxes, as long as the OP has contributed at least $500 to Roth IRA during his lifetime. source? What you wrote goes contrary to...
by retiredjg
Tue Nov 12, 2019 6:18 pm
Forum: Personal Investments
Topic: Regular investing into taxable while maintaining AA
Replies: 11
Views: 739

Re: Regular investing into taxable and maintaining AA

Here's an example. You are saving $37k a year. Of that, only $6k (16%) can go into Roth IRA. So it would be impossible for you to hold a 10% allocation to both of them because they pretty much have to go into the Roth IRA. That does not seem to be your situation, just an example. Correction, I read ...
by retiredjg
Tue Nov 12, 2019 6:14 pm
Forum: Personal Investments
Topic: Regular investing into taxable while maintaining AA
Replies: 11
Views: 739

Re: Regular investing into taxable and maintaining AA

It is difficult to interpret what you have in the way you have presented it. You might get better answers if you present it by account Taxable 5% this 10% that 401k 2% this 7% that Etc. on up to 100%. I'm not sure you can maintain your desired allocation to both REIT and the international bond becau...
by retiredjg
Tue Nov 12, 2019 5:50 pm
Forum: Investing - Theory, News & General
Topic: Order or distributions on Roth IRA
Replies: 26
Views: 1737

Re: Order or distributions on Roth IRA

So If you have contribution money it's a contributory IRA. And you do a complete rollover to a Roth IRA, and then you add money from a 401k rollover, it becomes a rollover IRA? I don't think this would happen because a 401k rollover is going to go into a new IRA and they will name it a rollover iRA...
by retiredjg
Tue Nov 12, 2019 5:35 pm
Forum: Personal Investments
Topic: Investing $140k in cash at 1k per week
Replies: 117
Views: 6438

Re: Investing $140k in cash at 1k per week

I think I will end up DCAing over 1 year (instead of 2.5) with $2800/week. And if there was a market correction near term I will just lump sum the remaining cash. An improved plan. You may have noticed that someone way above mentioned "tax lots". Investing once a week means you will have 52 "tax lo...
by retiredjg
Tue Nov 12, 2019 5:28 pm
Forum: Personal Investments
Topic: Investing $140k in cash at 1k per week
Replies: 117
Views: 6438

Re: Investing $140k in cash at 1k per week

Just curious, people who are anti-DCA, are you anti-bonds also? No. I do not think that DCA for a lump sum is the best choice financially. Lump sum is better more of the time. Not all of the time, but more of the time. Your best bet is to go with what works more of the time, don't you think? This h...
by retiredjg
Tue Nov 12, 2019 10:05 am
Forum: Personal Investments
Topic: Investing $140k in cash at 1k per week
Replies: 117
Views: 6438

Re: Investing $140k in cash at 1k per week

And there is no way to justify lump sum over DCA unless you looked into the future and found out that the stock market keeps rising up and there is no market crash in the near term. Actually there is a way to justify lump sum over DCA - studies have shown it works about better more often than not. ...
by retiredjg
Tue Nov 12, 2019 9:41 am
Forum: Personal Finance (Not Investing)
Topic: Months Leading up to Retirement
Replies: 19
Views: 1660

Re: Months Leading up to Retirement

Why would you need final medical and dental checkups?... Maybe so (s)he might get any necessary work done while still under the employer's medical and dental insurance? Yes, for this. You are a federal employee and in an earlier thread you said that your health care will continue in retirement (whi...
by retiredjg
Tue Nov 12, 2019 9:36 am
Forum: Personal Investments
Topic: Dilemma: After-tax 401K to Roth IRA, limited allocation for all 401K "types".
Replies: 18
Views: 967

Re: Dilemma: After-tax 401K to Roth IRA, limited allocation for all 401K "types".

Generally, once the money has been converted to Roth 401k, it is subject to the same withdrawal rules as money that was directly contributed to the Roth 401k, and no longer subject to non-Roth after-tax withdrawal rules. That usually means the money is "stuck" in the plan until separation of servic...
by retiredjg
Tue Nov 12, 2019 8:58 am
Forum: Investing - Theory, News & General
Topic: Order or distributions on Roth IRA
Replies: 26
Views: 1737

Re: Order or distributions on Roth IRA

A rollover IRA is a type of traditional IRA. If you rollover a 401k to an IRA, the new IRA is named a "rollover IRA" by your custodian - to indicate where the money came from. In the past, a 401k could only accept a rollover from a rollover IRA (conduit IRA). Some companies still do it that way. You...
by retiredjg
Tue Nov 12, 2019 8:49 am
Forum: Personal Finance (Not Investing)
Topic: Months Leading up to Retirement
Replies: 19
Views: 1660

Re: Months Leading up to Retirement

Why would you need final medical and dental checkups?

Just before my retirement I took a look at my TSP and realized it was invested at something like 90% stocks. Just dumb, but I got lucky. So check your investments.
by retiredjg
Tue Nov 12, 2019 8:25 am
Forum: Personal Investments
Topic: Asset allocation in Triditional 401k
Replies: 6
Views: 382

Re: Asset allocation in Triditional 401k

scooter101 wrote:
Mon Nov 11, 2019 10:58 pm
3. Vanguard Total Bond Market Index Fund Admiral Shares
VBTLX Exp ratio .05
No brainer in my opinion.

Total bond market is low cost and highly diversified. Contains some of most everything.
by retiredjg
Tue Nov 12, 2019 8:17 am
Forum: Personal Investments
Topic: Extra contributions to 401k ?? has anyone heard of this
Replies: 6
Views: 947

Re: Extra contributions to 401k ?? has anyone heard of this

let's hope discrimination testing has already been addressed isnt an issue as the employer is quite large and this would be a nightmare - lots of people and lots of $$ Discrimination testing is still in the picture (even in a safe harbor plan) and sometimes it has to be addressed (but the plan is r...
by retiredjg
Mon Nov 11, 2019 7:06 pm
Forum: Personal Investments
Topic: Investing $140k in cash at 1k per week
Replies: 117
Views: 6438

Re: Investing $140k in cash at 1k per week

Ok, looks like most recommended 12 months for DCA instead of 2.5 years. Is there a clear reason why 12 months is better?
Anything less than 2.5 years is better.
by retiredjg
Mon Nov 11, 2019 3:09 pm
Forum: Personal Investments
Topic: IRA Distribution and 403b contribution same year
Replies: 4
Views: 179

Re: IRA Distribution and 403b contribution same year

Taking money out and putting money in the 403 is allowed but would make little sense if there were not match. Since you do have a match, I'd contribute enough to get the match but no more.
by retiredjg
Mon Nov 11, 2019 2:46 pm
Forum: Personal Investments
Topic: Investing $140k in cash at 1k per week
Replies: 117
Views: 6438

Re: Investing $140k in cash at 1k per week

This is market timing. It might work. It might not. No way to know. But what we do know is that most of your money will be sitting on the sidelines for months. This is usually not a good practice. Investing $140k should take about 2.5 minutes, not 2.5 years. If you simply cannot do it at one time, i...
by retiredjg
Mon Nov 11, 2019 10:10 am
Forum: Personal Investments
Topic: mega backdoor roth gone wrong
Replies: 16
Views: 1697

Re: mega backdoor roth gone wrong

dangling wrote:
Mon Nov 11, 2019 2:45 am
Understood... so rolling after-tax-401k into Roth 401k is an OK option.
Yes.

And when the 2 years is up, I think you can roll that out to Roth IRA. The law allows it. I don't think the plan can prevent it (but I don't know for sure).
by retiredjg
Mon Nov 11, 2019 8:56 am
Forum: Personal Investments
Topic: roth ira in 403b
Replies: 14
Views: 515

Re: roth ira in 403b

Good luck! :happy
by retiredjg
Mon Nov 11, 2019 8:48 am
Forum: Personal Investments
Topic: Asset Allocation for larger portfolio
Replies: 29
Views: 1912

Re: Asset Allocation for larger portfolio

Even at current elevated market levels our allocation to stocks appears a bit low. Applying the Bucket approach as described at Morningstar we currently have 20 years of living expenses in BND/cash. I wonder if a larger portfolio ought to have a higher stock allocation given that 10 years reach of ...
by retiredjg
Mon Nov 11, 2019 8:36 am
Forum: Personal Finance (Not Investing)
Topic: Has anyone been retro billed for IRMAA?
Replies: 7
Views: 631

Re: Has anyone been retro billed for IRMAA?

The way I understand it, the 2017 and 2018 MAGIs do not affect a person's cost for Medicare in 2018. They would affect 2019 and 2020.

Sounds like a mistake or misunderstanding to me. Could there have been some 2016 income that you forgot about?
by retiredjg
Mon Nov 11, 2019 8:29 am
Forum: Personal Investments
Topic: May need to move 401k money by end of year, but not eligible for new 401k until February
Replies: 27
Views: 1376

Re: May need to move 401k money by end of year, but not eligible for new 401k until February

Paisley wrote:
Mon Nov 11, 2019 8:23 am
sorry - what I meant was do a regular rollover but just hold the check until 2020
Interesting concept, but I don't think it will work.

Form 8606, line 6 asks for the 12/31 value of all your IRAs plus any outstanding rollovers. That is the number that gets pro-rated.
by retiredjg
Mon Nov 11, 2019 7:43 am
Forum: Personal Investments
Topic: Backdoor Roth Gone Wrong
Replies: 12
Views: 1220

Re: Backdoor Roth Gone Wrong

@retiredjg - thanks for your guidance. I have been doing my taxes (via TurboTax), which I'm realizing is probably not the smartest idea. I'm probably going to enlist an accountant's help in the future... Your plan looks right to me. The reason I asked about how you do your taxes is that it is somet...
by retiredjg
Mon Nov 11, 2019 7:31 am
Forum: Personal Investments
Topic: May need to move 401k money by end of year, but not eligible for new 401k until February
Replies: 27
Views: 1376

Re: May need to move 401k money by end of year, but not eligible for new 401k until February

Paisley wrote:
Mon Nov 11, 2019 7:08 am
why would taxes be withheld from a 60 day rollover? you can just tell them not to withhold any taxes.
You can do that with an IRA. The withholding from a 401k is mandatory 20%.

https://www.irs.gov/retirement-plans/pl ... tributions
by retiredjg
Sun Nov 10, 2019 4:55 pm
Forum: Personal Investments
Topic: Should I use my 457(b)? Worried about disbursement options...
Replies: 32
Views: 1322

Re: Should I use my 457(b)? Worried about disbursement options...

Apparently I explained this poorly so let me try again. Right now, it appears you are putting $19k into His traditional 403b and $19k into Her traditional 403b and further savings is going into taxable. You are considering adding another $19k to the new account - a 457b. I'm suggesting that you cons...
by retiredjg
Sun Nov 10, 2019 4:42 pm
Forum: Personal Finance (Not Investing)
Topic: strategy check managing MAGI, RMD's etc
Replies: 17
Views: 963

Re: strategy check managing MAGI, RMD's etc

Well, you are clearly thinking about the options. Good luck to you! :happy
by retiredjg
Sun Nov 10, 2019 4:36 pm
Forum: Personal Investments
Topic: roth ira in 403b
Replies: 14
Views: 515

Re: roth ira in 403b

I am starting to understand the terminology. We live in Texas. An IRA is private. The 403b/401a and 403b roth are under a not for profit company retirement account. You can put $19,000-$24,000yr depending on age in these accounts divided up into either the 403b or 403 roth. (first is pre tax the ot...
by retiredjg
Sun Nov 10, 2019 4:30 pm
Forum: Investing - Theory, News & General
Topic: Tax Deferred : Taxable : Tax Free
Replies: 34
Views: 1727

Re: Tax Deferred : Taxable : Tax Free

What is the absolute amount you have in your tax deferred accounts? If it is less than $1 million (approximately) I wouldn't bother with Roth conversions. The reasoning is that, with balances less than that threshold, even withdrawals twice the RMD size would only place you in the 15% bracket, and ...
by retiredjg
Sun Nov 10, 2019 3:57 pm
Forum: Personal Investments
Topic: Need advice on maximum IRA contributions - possible oops!
Replies: 8
Views: 426

Re: Need advice on maximum IRA contributions - possible oops!

What? :shock: :shock: :shock: :shock:

Even if you're right (and I don't doubt that), it just feels all wrong.
by retiredjg
Sun Nov 10, 2019 3:30 pm
Forum: Personal Finance (Not Investing)
Topic: Backdoor Roth steps
Replies: 5
Views: 461

Re: Backdoor Roth steps

You don't have to leave it at all - although I would leave it until you see the pre-tax money show up in the Solo 401k....just in case there is a glitch.

Convert as soon as you want after it is safely away in the 401k. You do not have to wait until 2020.
by retiredjg
Sun Nov 10, 2019 3:27 pm
Forum: Personal Investments
Topic: Need advice on maximum IRA contributions - possible oops!
Replies: 8
Views: 426

Re: Need advice on maximum IRA contributions - possible oops!

You did exceed the limit, but this is nothing to panic about. The limit, including the catch up, is $7k for you in 2019. So you have an excess contribution of $3k. You can take it out of either IRA - up to you. But do not just take out the money. That will look like an ordinary withdrawal. You need ...
by retiredjg
Sun Nov 10, 2019 2:58 pm
Forum: Investing - Theory, News & General
Topic: Tax Deferred : Taxable : Tax Free
Replies: 34
Views: 1727

Re: Tax Deferred : Taxable : Tax Free

We are guilty of top heavy 68:7:25. Most everybody is top heavy. The limits for 401k and IRA make it that way and only people who both make and save a lot of money will/should have anything in taxable. Thinking of paying tax now for Roth Conversions when possible without bumping up the federal marg...