Search found 689 matches

by Horton
Mon Jul 06, 2020 9:07 pm
Forum: Personal Finance (Not Investing)
Topic: Longevity Annuity Purchase Timing w/ Today's Rates
Replies: 9
Views: 541

Re: Longevity Annuity Purchase Timing w/ Today's Rates

tj wrote:
Mon Jul 06, 2020 8:31 pm
You could instead buy MYGA's and 1035 into a DIA, gambling that rates are better in a few years.
Gambling is a good way of saying it. :beer

I do agree with your recommendation for blueprincome. I like their platform. Here is a link that shows the history for longevity annuity payout rates.
by Horton
Mon Jul 06, 2020 9:03 pm
Forum: Personal Investments
Topic: Changed AA
Replies: 23
Views: 1149

Re: Changed AA

I just couldn’t justify 100% stocks anymore. 50% VTSAX, 40% ally bank savings at 1.1%, 10% gold. I just see this market as very overvalued. And just couldn’t stomach the downside risk which outweighed the possible short term gains. You have provided virtually no details to help people critique your...
by Horton
Mon Jul 06, 2020 7:30 pm
Forum: Personal Finance (Not Investing)
Topic: Management Strategies - Entrenched Bad Staff
Replies: 23
Views: 1744

Re: Management Strategies - Entrenched Bad Staff

You have my sympathies. I've managed people in the past and this is why I'm perfectly content in my technical-track individual contributor role. I have three little "direct reports" to focus on right now.
by Horton
Mon Jul 06, 2020 7:27 pm
Forum: Personal Investments
Topic: Changed AA
Replies: 23
Views: 1149

Re: Changed AA

I just couldn’t justify 100% stocks anymore. 50% VTSAX, 40% ally bank savings at 1.1%, 10% gold. I just see this market as very overvalued. And just couldn’t stomach the downside risk which outweighed the possible short term gains. You have provided virtually no details to help people critique your...
by Horton
Mon Jul 06, 2020 5:01 pm
Forum: Personal Investments
Topic: Changed AA
Replies: 23
Views: 1149

Re: Changed AA

How old are you and how much money are we talking about (5, 6, 7... figures)?
by Horton
Mon Jul 06, 2020 11:32 am
Forum: Personal Investments
Topic: Bond Alternatives in the time of Zero rates
Replies: 50
Views: 4429

Re: Bond Alternatives in the time of Zero rates

I have no idea what Horton is saying with the "rolldown" and "forward looking" returns etc. Are these guesses for the future? How do they help? The Vanguard Total Bond has averaged 3.66% a year over the past 10 years and averaged 5.93% a year since its inception in 1986. We do not know the future. ...
by Horton
Sun Jul 05, 2020 6:05 pm
Forum: Personal Finance (Not Investing)
Topic: Manager vs. Direct report salary issues
Replies: 138
Views: 8491

Re: Manager vs. Direct report salary issues

Managers' comparing their salaries against those of their reports is absurd and an abuse of the privilege. Companies give such privilege for budgetary reasons, NOT for personal use. What is next? Comparing educations? College grades? Marital matters? Any other personal matters? Your response must b...
by Horton
Sun Jul 05, 2020 5:46 pm
Forum: Personal Investments
Topic: Retire or grind it out at another job after a layoff ?
Replies: 49
Views: 5233

Re: Retire or grind it out at another job after a layoff ?

cashboy wrote:
Sun Jul 05, 2020 4:55 pm


i see nothing in that document relevant to my post which was simply an example of how income can be generated from a lump sum - this is the same thing investors do every day with their investments.
Slide 2 of this BlackRock presentation may also help.
by Horton
Sun Jul 05, 2020 5:40 pm
Forum: Personal Finance (Not Investing)
Topic: Manager vs. Direct report salary issues
Replies: 138
Views: 8491

Re: Manager vs. Direct report salary issues

Managers' comparing their salaries against those of their reports is absurd and an abuse of the privilege. Companies give such privilege for budgetary reasons, NOT for personal use. What is next? Comparing educations? College grades? Marital matters? Any other personal matters? Your response must b...
by Horton
Sun Jul 05, 2020 4:27 pm
Forum: Personal Finance (Not Investing)
Topic: Manager vs. Direct report salary issues
Replies: 138
Views: 8491

Re: Manager vs. Direct report salary issues

Managers' comparing their salaries against those of their reports is absurd and an abuse of the privilege. Companies give such privilege for budgetary reasons, NOT for personal use. What is next? Comparing educations? College grades? Marital matters? Any other personal matters? Your response must b...
by Horton
Sun Jul 05, 2020 4:13 pm
Forum: Personal Investments
Topic: Retire or grind it out at another job after a layoff ?
Replies: 49
Views: 5233

Re: Retire or grind it out at another job after a layoff ?

cashboy wrote:
Sun Jul 05, 2020 3:38 pm

again, the point of my post was simply to show that income can be produced from a lump sum.
William Bengen debunked your entire argument back in 1994. This is why we have the “4% rule” and not the “7-8% rule.”
by Horton
Sun Jul 05, 2020 3:03 pm
Forum: Personal Investments
Topic: Retire or grind it out at another job after a layoff ?
Replies: 49
Views: 5233

Re: Retire or grind it out at another job after a layoff ?

I'll look at the lump option a little more closely. something to consider regarding pension income (taking annuity) compared to self generating your own 'pension income' (rollover lump sum into an IRA and invest it): your pension if taken as an annuity is $57,000 and not COLA (neither is mine :? ) ...
by Horton
Sun Jul 05, 2020 12:49 pm
Forum: Personal Investments
Topic: Retire or grind it out at another job after a layoff ?
Replies: 49
Views: 5233

Re: Retire or grind it out at another job after a layoff ?

For the pension, are you planning to take the annuity? I would. Yes, definitely planning on the annuity option. Lump sum just can't generate the same kind of income. Thanks. It would be good to keep an open mind about that and do another post with all the details when you are closer to having to ma...
by Horton
Sun Jul 05, 2020 11:09 am
Forum: Investing - Theory, News & General
Topic: Personal Capital Acquired
Replies: 37
Views: 4180

Re: Personal Capital Acquired

Unfortunately the entire blog-as-business ecosystem is rife with these kinds of conflicts of interest. Two examples: "Going for Gold" at Can I Retire Yet? Things can change overnight. My book sales and blog advertising revenue looked strong in February. They fell off a cliff in March. "So That’s Wh...
by Horton
Sun Jul 05, 2020 10:54 am
Forum: Personal Investments
Topic: Bond Alternatives in the time of Zero rates
Replies: 50
Views: 4429

Re: Bond Alternatives in the time of Zero rates

For Vanguard Total Bond, the chart below shows the yield, six year forward looking return, and rolldown return (return - yield) for the past 25 years. The rolldown return averages about 0.20%. Take Total Bond's current yield (1.37%) plus an estimate of the rolldown return (0.20%) and you have an est...
by Horton
Sun Jul 05, 2020 10:41 am
Forum: Personal Investments
Topic: Retire or grind it out at another job after a layoff ?
Replies: 49
Views: 5233

Re: Retire or grind it out at another job after a layoff ?

Running all of those updated numbers in Firecalc with your asset allocation still gives you a 15% chance of depleting your portfolio completely before thirty-five years of retirement. Putting in another spending reduction of $16,000 in 2038 when your mortgage is paid off reduces the chance of prema...
by Horton
Sun Jul 05, 2020 10:37 am
Forum: Personal Investments
Topic: Retire or grind it out at another job after a layoff ?
Replies: 49
Views: 5233

Re: Retire or grind it out at another job after a layoff ?

You might also think about getting rid of the Fidelity management fee. Put the money in a balanced fund or a target date fund instead. Expected returns are lower, so shaving off the 0.70% management fee will help.
by Horton
Sun Jul 05, 2020 10:32 am
Forum: Personal Investments
Topic: Retire or grind it out at another job after a layoff ?
Replies: 49
Views: 5233

Re: Retire or grind it out at another job after a layoff ?

For the pension, are you planning to take the annuity? I would.
by Horton
Fri Jul 03, 2020 2:39 pm
Forum: Investing - Theory, News & General
Topic: CALPERS taking on leverage: Is leverage becoming more mainstream?
Replies: 25
Views: 1767

Re: CALPERS taking on leverage: Is leverage becoming more mainstream?

This is akin to wanting FIRE without the sacrifice of prodigious saving.
by Horton
Fri Jul 03, 2020 2:29 pm
Forum: Investing - Theory, News & General
Topic: First 20% of bonds in long-term Treasuries
Replies: 861
Views: 57848

Re: First 20% of bonds in long-term Treasuries

Does EDV and new issued 30 year treasury bonds both have a duration of 24.5? A newly issued 30-year Treasury bond would have a duration of about 20.5 years because the coupon payments reduce the effective duration. Why does this bond calculator say this bond has a duration of 24.6? It's a 30 year t...
by Horton
Fri Jul 03, 2020 1:29 pm
Forum: Investing - Theory, News & General
Topic: First 20% of bonds in long-term Treasuries
Replies: 861
Views: 57848

Re: First 20% of bonds in long-term Treasuries

Does EDV and new issued 30 year treasury bonds both have a duration of 24.5? A newly issued 30-year Treasury bond would have a duration of about 20.5 years because the coupon payments reduce the effective duration. Why does this bond calculator say this bond has a duration of 24.6? It's a 30 year t...
by Horton
Fri Jul 03, 2020 1:27 pm
Forum: Investing - Theory, News & General
Topic: What's a good source to see inflation predictions?
Replies: 10
Views: 627

Re: What's a good source to see inflation predictions?

galeno wrote:
Fri Jul 03, 2020 1:24 pm
Watch the yield on 10 yr TIPS.
That tells you the real yield. You would need to compare to a nominal 10 yr Treasury for the implied inflation.
by Horton
Fri Jul 03, 2020 1:20 pm
Forum: Investing - Theory, News & General
Topic: What's a good source to see inflation predictions?
Replies: 10
Views: 627

Re: What's a good source to see inflation predictions?

duricka wrote:
Fri Jul 03, 2020 11:36 am
Thanks. You are not worried that classical tm/tbm portfolio is going to fail with infinite qe policy?
To quote St Peter, “where else shall we go?”
by Horton
Fri Jul 03, 2020 1:16 pm
Forum: Investing - Theory, News & General
Topic: Time Value Money Calculator
Replies: 3
Views: 311

Re: Time Value Money Calculator

Ken Steiner’s website has some spreadsheets that might be helpful: http://howmuchcaniaffordtospendinretirement.blogspot.com/p/articles-spreadsheets.html?m=1 I believe Siamond has a spreadsheet too, so hopefully he will chime in. Willthrill often advocates using a simple calculator to do the calculat...
by Horton
Mon Jun 29, 2020 9:41 pm
Forum: Investing - Theory, News & General
Topic: Finding Middle Ground on the LMP
Replies: 95
Views: 4774

Re: Finding Middle Ground on the LMP

You can calculate the life expectancy using this calculator:

https://www.longevityillustrator.org/

The median life expectancy for a 65 year old male in excellent health is 23 years.
by Horton
Mon Jun 29, 2020 9:36 pm
Forum: Investing - Theory, News & General
Topic: Finding Middle Ground on the LMP
Replies: 95
Views: 4774

Re: Finding Middle Ground on the LMP

You can calculate the duration of an annuity using this calculator:

https://afc.soa.org/

The duration of an annuity for a 65 year old male assuming a 3% discount rate (and no changes to any of the other inputs) is 10 years.
by Horton
Sun Jun 28, 2020 9:54 pm
Forum: Investing - Theory, News & General
Topic: Finding Middle Ground on the LMP
Replies: 95
Views: 4774

Re: Finding Middle Ground on the LMP

There’s a distinction between the duration of an annuity and the duration of a bond portfolio/ladder that is intended to cover potential expenses beyond life expectancy. The duration of an annuity will be much less than life expectancy - a very rough approximation could be a little less than: (life ...
by Horton
Sun Jun 28, 2020 7:40 pm
Forum: Investing - Theory, News & General
Topic: Inflation since 1209
Replies: 31
Views: 2704

Re: Inflation since 1209

1209?! Sounds like cherry picking...why not start in 1208 or 1210? :wink:
by Horton
Sun Jun 28, 2020 1:32 pm
Forum: Investing - Theory, News & General
Topic: Amount needed to retire - inflation adjusted
Replies: 49
Views: 5454

Re: Amount needed to retire - inflation adjusted

Use the Funded Ratio to drive your retirement investment plan. Link - https://www.bogleheads.org/forum/viewtopic.php?f=10&t=219878 and https://blbarnitz4.wordpress.com/2017/01/15/monitoring-your-retirement-goal-the-funded-ratio/ BobK BobK, Wondering if you could comment on my analysis of the Funded...
by Horton
Sun Jun 28, 2020 1:18 pm
Forum: Investing - Theory, News & General
Topic: Finding Middle Ground on the LMP
Replies: 95
Views: 4774

Re: Finding Middle Ground on the LMP

I'm disappointed that inflation indexed annuities are not available except for social security. A compromise for those seeking more than what social security provides would be to buy a TIPS that pays out at age 90, and use the proceeds to purchase a nominal SPIA at age 90. You avoid inflation risk ...
by Horton
Sun Jun 28, 2020 1:03 pm
Forum: Investing - Theory, News & General
Topic: Newbies question - Gordon equation & William Bernstein remark
Replies: 16
Views: 1195

Re: Newbies question - Gordon equation & William Bernstein remark

Expectations of future returns, using the Gordon equation or other models, are useful to build a savings and investment plan to meet your goals. Expected returns are lower than historical returns, so you will need to save more or work longer. If returns end up being better than expected, then you mi...
by Horton
Sun Jun 28, 2020 9:30 am
Forum: Investing - Theory, News & General
Topic: Finding Middle Ground on the LMP
Replies: 95
Views: 4774

Re: Finding Middle Ground on the LMP

Good thread. One thing i have not seen discussed though is that, under current law, Social Security benefits will be cut by an amount currently estimated at 24% starting in 2034. I'm wondering how folks are factoring that in. i think for my personal situation it means i should probably start collec...
by Horton
Sat Jun 27, 2020 3:04 pm
Forum: Investing - Theory, News & General
Topic: Target Date Funds doing it backwards?
Replies: 68
Views: 7947

Re: Target Date Funds doing it backwards?

nanameg wrote:
Sat Jun 27, 2020 2:50 pm
I agree but is that a dream? Finding a good few only planner isn’t easy either. I’ve looked. And most do try to sell you a “ package”.
Harry Sit (forum user “tfb”) has a service where he will help you find an “advice only” planner:

https://adviceonlyfinancial.com
by Horton
Fri Jun 26, 2020 9:11 pm
Forum: Investing - Theory, News & General
Topic: Deferred Income Annuity
Replies: 14
Views: 2165

Re: Deferred Income Annuity

Grt2bOutdoors wrote:
Fri Jun 26, 2020 8:44 pm
Insurance companies are investing in a mix of government, corporates, private placements. Some of which are a little lower on the rating totem pole in an effort to squeeze some yield.
What’s your point? They also hold reserves above and beyond their liabilities.
by Horton
Fri Jun 26, 2020 8:21 pm
Forum: Investing - Theory, News & General
Topic: Finding Middle Ground on the LMP
Replies: 95
Views: 4774

Re: Finding Middle Ground on the LMP

ionball wrote:
Fri Jun 26, 2020 7:57 pm
This plan better work or I'll be kicking myself!
Sounds like a good plan to me! :beer

If anything, you might be able to increase your spending.
by Horton
Fri Jun 26, 2020 5:16 pm
Forum: Personal Consumer Issues
Topic: Dress Shirts
Replies: 47
Views: 3654

Re: Dress Shirts

Brooks Brothers must be hurting because I recently got an email indicating they have a deal going - 5 shirts for $200.

OP - Throw those old shirts out and go get some BB shirts now! You won’t regret it. :beer
by Horton
Fri Jun 26, 2020 5:07 pm
Forum: Investing - Theory, News & General
Topic: Target Date Funds doing it backwards?
Replies: 68
Views: 7947

Re: Target Date Funds doing it backwards?

Is this just another article trying to push people towards investment advisors? They do say nothing can overcome inadequate saving ( over your working life ) or retiring too early. They didn't mention how difficult it can be for many to actually continue working as long as they'd like. "Paul Merrim...
by Horton
Fri Jun 26, 2020 4:58 pm
Forum: Investing - Theory, News & General
Topic: Finding Middle Ground on the LMP
Replies: 95
Views: 4774

Re: Finding Middle Ground on the LMP

A very plausible alternative to all of those approaches is to use a spreadsheet and the time value of money formula, including expected returns for one's portfolio and multiple income streams beginning (or ending) at various points in the future to determine how much one can withdraw at the current...
by Horton
Fri Jun 26, 2020 12:05 pm
Forum: Investing - Theory, News & General
Topic: Finding Middle Ground on the LMP
Replies: 95
Views: 4774

Re: Finding Middle Ground on the LMP

Livesoft's VPW which solves for constant consumption falls within the category of solutions that will minimize sequence of return risk over past returns. But a more general solution will allow for rising or falling consumption based on time preferences as well as precautionary savings. Livesoft's V...
by Horton
Fri Jun 26, 2020 11:11 am
Forum: Investing - Theory, News & General
Topic: Finding Middle Ground on the LMP
Replies: 95
Views: 4774

Re: Finding Middle Ground on the LMP

3. VPW will need to be tweaked for most people (but it's easy to do) VPW is close to being an excellent strategy for withdrawing from your risk portfolio. It's much better than fixed withdrawal strategies like the 4% rule. But it has a significant drawback. It uses annuitization to calculate how mu...
by Horton
Fri Jun 26, 2020 10:59 am
Forum: Investing - Theory, News & General
Topic: Finding Middle Ground on the LMP
Replies: 95
Views: 4774

Re: Finding Middle Ground on the LMP

2. Why should the LMP match Social Security? The social security payout is an arbitrary amount determined by a government program. It would be a coincidence if it matched up with your desired LMP level based on your preferences. I would suggest coming up with your own number independent of social s...
by Horton
Fri Jun 26, 2020 10:55 am
Forum: Investing - Theory, News & General
Topic: Finding Middle Ground on the LMP
Replies: 95
Views: 4774

Re: Finding Middle Ground on the LMP

As long as the gap between retirement and beginning SS benefits isn't too long, this is a perfectly plausible approach that many are already using. However, it becomes increasingly 'expensive' as the gap lengthens. For the same reason, an LMP approach does not really work out well for early retiree...
by Horton
Thu Jun 25, 2020 3:42 pm
Forum: Personal Finance (Not Investing)
Topic: Pension Buyout Scenario -did I do this right?
Replies: 22
Views: 1018

Re: Pension Buyout Scenario -did I do this right?

Here's how I "think" we should be looking at this. $70k now invested 21 years with safe 4% return estimate = $159,500. $70 now invested 21 years with "typical" 8% return estimate = $$352,250 Here's the issue. The pension is guaranteed income.* As such, you should assume a return equivalent to the r...
by Horton
Thu Jun 25, 2020 3:33 pm
Forum: Investing - Theory, News & General
Topic: Finding Middle Ground on the LMP
Replies: 95
Views: 4774

Finding Middle Ground on the LMP

I recently re-read "Viability of the Spend Safely in Retirement Strategy" , a paper by Wade Pfau, Joe Tomlinson, and Steven Vernon that follows up on their original paper on the Spend Safely in Retirement Strategy ( SSiRS ). I like the follow-up paper more than the original because it focuses specif...
by Horton
Thu Jun 25, 2020 2:44 pm
Forum: Personal Finance (Not Investing)
Topic: Pension Buyout Scenario -did I do this right?
Replies: 22
Views: 1018

Re: Pension Buyout Scenario -did I do this right?

the best way to do the comparison is to compare the lump sum being offered to the price of a deferred annuity for a male currently 39 years old where payments start at age 65. you should be able to do this on immediateannuities.com I agree. Here are some quotes from Blueprint Income assuming the an...
by Horton
Thu Jun 25, 2020 11:01 am
Forum: Personal Finance (Not Investing)
Topic: Pension Buyout Scenario -did I do this right?
Replies: 22
Views: 1018

Re: Pension Buyout Scenario -did I do this right?

The most important consideration is the solvency of the plan. If there is any doubt at all the money will still be available in 21 years, it is a no-brainer to take it while he can. Maybe, maybe not. If the plan is a single employer plan, then the PBGC backup guarantee is pretty strong. At the doll...
by Horton
Thu Jun 25, 2020 10:28 am
Forum: Personal Finance (Not Investing)
Topic: Pension Buyout Scenario -did I do this right?
Replies: 22
Views: 1018

Re: Pension Buyout Scenario -did I do this right?

Let’s set the quantitative analysis to the side for a moment and let me ask a general question. Do you want to have annuity income in retirement? If so, the pension is almost always going to be the most efficient way to get it. If not, then the analysis doesn’t really even matter.
by Horton
Thu Jun 25, 2020 10:23 am
Forum: Investing - Theory, News & General
Topic: Target Date Funds doing it backwards?
Replies: 68
Views: 7947

Re: Target Date Funds doing it backwards?

In a Sept. 2012 commentary cited by MW, Arnott laid out a more reliable scheme for achieving "financial longevity." This includes saving aggressively, spending cautiously, and working a few years longer. "No strategy can make up for inadequate savings or premature retirement," he wrote. If you do t...