Search found 11207 matches

by randomguy
Mon Mar 18, 2024 9:36 pm
Forum: Investing - Theory, News & General
Topic: 4 Methods of Reducing Sequence of Returns Risk - Dr. Jim Dahle
Replies: 2
Views: 485

Re: 4 Methods of Reducing Sequence of Returns Risk - Dr. Jim Dahle

None of these really reduce SORR. They are at best ways of surviving it. Spending less (1+2) is pretty straight forward. But you are suffering the full effects of SORR as you are not spending what you hoped for. Reducing volatility is borderline at best. Go look at all the bond tents and bucket schemes for the 1966 retiree and they are pretty much the same as any other reasonable retiree portfolio (call it 30/70 to 70/30). You can't get from 4% to 6% by AA/Buckets/Bond tents/.... as the problem is volaility is only only half the problem and getting 0% real return for 15 years is the other half. #4 is gets into a questionable zone. If it is cash, you are doing some bucket scheme ( You are holding 11x stocks, 11x bonds, 3x cash instead of 11x...
by randomguy
Sat Mar 16, 2024 6:05 pm
Forum: Personal Consumer Issues
Topic: Buying an Expensive Car
Replies: 80
Views: 6319

Re: Buying an Expensive Car

I don't do snowboarding or mountain biking but New Zealand is a fantastic place to visit and I would assume that both of those would be great there. To me taking trips to places like New Zealand, Australia, the european Alps, Africa, etc when you are in your 30s would be a lot better use of the money than an expensive car. I second this recommendation - you can enjoy an expensive car even when you're older but a trip like this will be unforgettable. Have you ever seen a 70 year old trying to get into some low slung sports car? Have you every asked them how aggressive driving felt on the spine? Pretty easy on the other hand to sit in the jeep in africa/new zealand when your 70:). Personally I would never buy the car because it doesn't provi...
by randomguy
Sat Mar 16, 2024 5:16 pm
Forum: Investing - Theory, News & General
Topic: Anybody heard stories of well "prepared" retirees running out of money?
Replies: 88
Views: 10184

Re: Anybody heard stories of well "prepared" retirees running out of money?

"Prepared" can be subject to all interpretations... that can lead to disasters. I was thinking more someone who were NOT involved in heavy stuff (addictions, healthcare or got stolen), was not poor to begin with, nor cases in which their company pension went kaput. I know about VPW, SWR..., I don't really need more details about them (I understand their benefits). The reason why I ask is because I saw quite a few sources mentioning that 2.7% or 3.3% is now the new 4%, including Morningstar in 2021 but possibly amended that later. I can understand the flexibility of probabilities, but I wonder if there are actual & recent real-life cases proving their point , or if it a strategy to get more $ from investors. This might include...
by randomguy
Tue Mar 12, 2024 10:22 pm
Forum: Investing - Theory, News & General
Topic: Dot.Com Era/AI Era?
Replies: 302
Views: 27390

Re: Dot.Com Era/AI Era?

This thread has me now strongly convinced AI is indeed a bubble!! This has all the elements of an asset bubble where a large number of investors are willing to bet on something just based on a promise, much like the dot com bubble. The big difference people use to justify now vs then are some of these companies do have profits and strong advantages, where as many dot coms didn't. So what .. nothing has fundamentally changed for any of these companies, except now added the key phrase "AI" in front of them. For instance, Microsoft is still selling software by subscriptions, their main cash cows being Office 365 and Azure, NVDA is still selling their chips, now the story being they're used for AI, that's it. Obviously people come ou...
by randomguy
Mon Mar 11, 2024 11:26 pm
Forum: Personal Finance (Not Investing)
Topic: moving from ~600k to ~1.5M income
Replies: 74
Views: 11753

Re: moving from ~600k to ~1.5M income

We live in a perfectly fine upper-middle class house in an outer suburb, but we've been toying with the idea of getting a nicer/better located house for a while. Its really hit home to me that my first big RSU grant (before tax) will be ~130% of our house value. Additionally at a ~50% marginal tax rate, half the mortgage interest is subsidized away. at what point do we commit to a "bigger" lifestyle? If the income bump isn't permanent (or at least guaranteed for the next 3-5 years), I wouldn't look for permanent upgrades like a larger more expensive house (with larger more expensive expenses) I would start with discretionary spending that could easily be cut back if necessary. Like spending on more expensive trips, or maybe even ...
by randomguy
Mon Mar 11, 2024 7:16 pm
Forum: Personal Investments
Topic: SS is insufficient, very little savings, what's the best option
Replies: 49
Views: 7791

Re: SS is insufficient, very little savings, what's the best option

I do not know any of the other details regarding SS incomes, other debts, etc. The information I've provided was just offered in a casual conversation. I was sufficiently concerned that I offered to help her find resources, and keep her away from EJ and the like. I was hoping to provide very rough direction, such as read the materials I cited, investigate SPIAs, probably stay out of stocks. Did they ask for asistance, or was it offered and accepted gratefully? Sometimes, especially with family, it can be a minefield to insert oneself into others' financial matters (or any matters in fact). Yeah that this the number 1 thing. I wouldn't really want to be the one presenting a plan that is very unlikely to be popular. If I had complete control...
by randomguy
Mon Mar 11, 2024 6:07 pm
Forum: Investing - Theory, News & General
Topic: Dot.Com Era/AI Era?
Replies: 302
Views: 27390

Re: Dot.Com Era/AI Era?

Hard to say but AI can do everything a human can do and more. An example is protein folding which was thought to be unsolvable by researchers before Google solved it. I wanted to be involved in this discussion, but all my thoughts on AI are negative... and I don't want to be negative. But then this comes along. Can AI mow my lawn or cut down that tree that's about to fall on my house? What about wheel the garbage to the end of the driveway every week or feed my dogs everyday or clean out the gutters before a rain? What is AI's opinion on the homeless problem, the border crisis, or climate change? I don't know what protein folding is, but it doesn't sound like a Top 100 concern of "joe the plumber" or "joe the president"...
by randomguy
Mon Mar 04, 2024 8:40 pm
Forum: Personal Consumer Issues
Topic: sauna or hot tub, which to get and why?
Replies: 51
Views: 4427

Re: sauna or hot tub, which to get and why?

This is going to be whichever one you will actually use type question. If you don't have past experience using either one a lot, I would sort of hesitate to buy one with the expectation that you will start using one....
by randomguy
Mon Mar 04, 2024 8:33 pm
Forum: Personal Finance (Not Investing)
Topic: Does healthcare remain a significant concern for retirement before 65, even with a well-planned budget?
Replies: 66
Views: 6328

Re: Does healthcare remain a significant concern for retirement before 65, even with a well-planned budget?

We are in a similar situation and have found healthcare to be our largest expense in early retirement... you'll need to factor in as much as $45K per year. Here in Florida, for a gold plan with roughly $15K in max OOP the premium is $2700 per month/$32K per year for a married couple. If you plan on paying the max, you can price out the other plans with lower deductibles and often come out a head. But yes nobody is going to argue that health insurance can be expensive. But it is pretty finite and can be planned for. There are secondary costs after you get sick which are much harder to plan for. Those are much harder to figure out. Some of them might be covered by long term care and the like but there are a lot which you might have to pay. I...
by randomguy
Mon Mar 04, 2024 4:45 pm
Forum: Personal Finance (Not Investing)
Topic: Does healthcare remain a significant concern for retirement before 65, even with a well-planned budget?
Replies: 66
Views: 6328

Re: Even with a well-planned budget, does healthcare remain a significant concern for retirement before 65?

Since that passage of the ACA and the fact that pre-existing conditions can't disqualify you, I think the main obstacle to retiring before 65 all boils down to money, not healthcare. If you have enough money, health insurance is always an option because of ACA, right? Isn't this a tautology? If lacking health insurance but needing sophisticated care, there will be an exorbitant cost. But... isn't this just a matter of money? If within-network care is shoddy, and one has to seek expertise outside of the network, this will be costly. But again... isn't this just a matter of money? Sure but there is a vast difference between budgeting 30k/year for health care (ACA) and budgeting 2 million (no health care and need to be able to pay for an orga...
by randomguy
Thu Feb 29, 2024 12:14 am
Forum: Investing - Theory, News & General
Topic: Retirees apparently tend to maintain assets - lessons for BH investors?
Replies: 129
Views: 16926

Re: Retirees apparently tend to maintain assets - lessons for BH investors?

With steady spending, if you take out an amount that will keep your account balances roughly the same in nominal dollars, your failure rate tends to be like 50%. I call that aggressive. Pick something with a 5-10% failure rate and on average your money is doubling. A "failure" here is the typical "run out of money", where the graph of multiple possible totals over time ends up at zero (or perhaps even negative)? But how many people would really run the total into the ground like that? And all the more so... IF they could cut back because they were enjoying "extras", it would be that much easier to cut back to "fewer extras", etc. So the 50% isn't necessarily really "run out of money half the tim...
by randomguy
Wed Feb 28, 2024 11:24 pm
Forum: Investing - Theory, News & General
Topic: Retirees apparently tend to maintain assets - lessons for BH investors?
Replies: 129
Views: 16926

Re: Retirees apparently tend to maintain assets - lessons for BH investors?

After thinking about it, I believe you're correct about the nominal amount being greater than I'd anticipated. For example if I test a 3.5% SWR with a 3-fund using actual returns for the past 25 years, I see someone retiring with $10k ending up with about $17k nominal (but less than $10k in real terms.) Of course I'm not sure how a different sequence of returns etc. would have affected that. On your other lifestyle point, I still believe that more people buy into delayed gratification vs. no gratification ever. While living exactly the same lifestyle forever is okay, I don't believe it's most people's definition of "gratification." I don't see someone going from coach to first class for the reasons you mentioned, but I do see the...
by randomguy
Wed Feb 28, 2024 8:37 pm
Forum: Investing - Theory, News & General
Topic: Retirees apparently tend to maintain assets - lessons for BH investors?
Replies: 129
Views: 16926

Re: Retirees apparently tend to maintain assets - lessons for BH investors?

I doubt many bogleheads are that aggressive at spending. If you retired in the past 45 years with a 4% SWR, odds are you have more money that you started with. The exception would be the couple years around 2000 and 2007. We plan for the worst but you rarely get the worst. Odds are you are getting median outcomes.. In the end their isn't much you can do about it. At 60, I don't know if I am getting a 4% SWR or a 7% one. And at 85 when you have a good clue of where you are, you aren't going to radically up your spending. And no an annuity doesn't help. That just locks in bottom 5% results.. So I was guessing that Bogleheads probably maintain their retirement net worth (well, let's say account balances) in nominal dollars, but you're saying ...
by randomguy
Tue Feb 27, 2024 3:30 pm
Forum: Investing - Theory, News & General
Topic: Retirees apparently tend to maintain assets - lessons for BH investors?
Replies: 129
Views: 16926

Re: Retirees apparently tend to maintain assets - lessons for BH investors?

I'm not sure what the premise of the discussion is, but my guess is that Bogleheads mostly spend down a portfolio in terms of inflation-adjusted amounts, or at least have been doing that recently. So if they started with $3M they might still have close to $3M, but the $3M definitely doesn't have the purchasing power it used to. However I don't believe most Bogleheads care at all about dividends, much less income-producing real estate. They do care about earning an extra .01% on whatever small amount they keep in cash, though. I've found retirement to be surprising in terms of the type of spending more than the amount. I hadn't predicted that after several years I would have spent more on taxes than on everything else combined - and that is...
by randomguy
Thu Feb 22, 2024 12:05 am
Forum: Personal Consumer Issues
Topic: Thoughts on buying cheap, used, "intermediate" range EV?
Replies: 168
Views: 13584

Re: Thoughts on buying cheap, used, "intermediate" range EV?

I've been tempted to get a Audi Etron "city/errand car" - the deals are SO GOOD right now. But then you read stuff like this on the forums....and wonder what a used one just 2-3 years old at $26-$30k will be worth. Lord_Audi - 5 mo. ago I bought my 2019 Etron in Oct 2022 for $60k used 15k miles on it. Today trade in value with 21k miles is at $31k.......... I was positive in equity of $4k and now I'm almost $30k in debt. I'm actually shocked by this. How can a car depreciate that fast? A 75k luxury car going to 31k trade in over ~5-7 years sounds about right now me. The problem here is the paying 60k for a 3 or 4 year old luxury car instead of like 45k. If they had bought say an Audi Q7 (a gas car roughly the same price), they wo...
by randomguy
Wed Feb 21, 2024 5:31 pm
Forum: Personal Consumer Issues
Topic: The Shrinking Lifespan of Large Appliances
Replies: 108
Views: 10068

Re: The Shrinking Lifespan of Large Appliances

Electronics in particular, but a lot of devices generally, follow the U shaped "bathtub curve" of reliability. They have a higher failure rate in the early days, Dead On Arrival even, due to flaws in manufacturing. The stress of extreme miniaturisation, which also means heat stress for the components. Once that period is over, they often then have quite low failure rates until you get towards the designed life of the device. At which point they start to inevitably rise again. So that would cover some of the electronic components of a modern appliance. It's also the problem with extended warranties, because the basic warranty covers the first 1-2 years, and then after that it's unlikely to be a warranty claim -- the extended warra...
by randomguy
Wed Feb 21, 2024 5:25 pm
Forum: Personal Consumer Issues
Topic: The Shrinking Lifespan of Large Appliances
Replies: 108
Views: 10068

Re: The Shrinking Lifespan of Large Appliances

If you want something that is built to last, then buy a brand that is built to last AND pay to have it repaired. This is way easier said than done. It's not really clear what will last, and paying for a repair is probably just good money before bad as it needs a second repair then a third repair. Many of us have been down that road before. An appliance needing an expensive repair after 5 years is probably not worth fixing in the long run. Sure. But IMO it is worth a phone call and 5 years is on the low side. A refrigerator, oven, cooktop, washer, dryer, dishwasher... all of those should last at least 10 years and are worth a repair cost of a couple hundred dollars. It is certainly a personal preference. Many draw the line at 5 years, as I ...
by randomguy
Tue Feb 20, 2024 4:23 pm
Forum: Personal Consumer Issues
Topic: Thoughts on buying cheap, used, "intermediate" range EV?
Replies: 168
Views: 13584

Re: Thoughts on buying cheap, used, "intermediate" range EV?

BEVs have a minimum battery warranty of 8 years and many have 10 (including Tesla), so the only risk for an "early" failure would be the battery failing between years 11-15. Tesla model 3/y warranty is 8/100 or 8/120 depending on the model y. For the average person driving 15k/year that is going to be 7-8 years. You can either go that is a long time OR you can go that is half of the time I expect to be driving a car. And that warranty allows for 30% capacity degradation which might start really cutting your use cases down. 330 miles covers all my uses. 230 means I am not visting the parents when it is cold out:) Now it should be pointed out ICE have engines where this same basic math is going on. Your 10 year old civic might run ...
by randomguy
Tue Feb 20, 2024 10:19 am
Forum: Personal Consumer Issues
Topic: Thoughts on buying cheap, used, "intermediate" range EV?
Replies: 168
Views: 13584

Re: Thoughts on buying cheap, used, "intermediate" range EV?

A used Tesla Model 3 and Y would be my choice. The EV depreciation issue is overblown. This is false. Most EVs depreciate much faster than most ICE vehicles. Just search "do EVs depreciate faster." "All-electric vehicles have the worst depreciation rate by vehicle type. iSeeCars reports the average five-year depreciation rate for electric vehicles is almost 50%, meaning the typical EV loses half its value in just five years. One reason is technology." Here's some examples 2017 Model S 100D $116,250 MSRP. In 2019. In December, 2023, owner posted Caravan indicated the car was worth $36,500. --> $79,750 / 68% depreciation in 2 years. Local examples... 2018 Model 3 was $66,000. Today they are selling for $22k. $44k / 67% de...
by randomguy
Fri Feb 16, 2024 1:33 pm
Forum: Investing - Theory, News & General
Topic: Any studies to refute dividend yield & chill?
Replies: 161
Views: 12094

Re: Any studies to refute dividend yield & chill?

Let's say you pursued the "dividend and chill strategy" with 50% Vanguard US total stock and 50% Total International back as far as you could go with these funds (1997) and started with $1 mil (about $1.93 million in today's dollars). Your yearly income adjusted for inflation to today is shown in the chart below. In 2024, you'd would be left with $3,581,462 for a CAGR of 4.82% (not spending the dividends and re-investing them would have left you with $6,312,897 and a CAGR of 7.04%). Definitely a wide range of income, though. The dot com bubble bursting sees your income cut by almost half. The average income is $57k, median $55k. But this would be a perpetual strategy barring alien invasion or outlawing of dividends worldwide. It ...
by randomguy
Thu Feb 15, 2024 9:41 pm
Forum: Personal Consumer Issues
Topic: Thoughts on buying cheap, used, "intermediate" range EV?
Replies: 168
Views: 13584

Re: Thoughts on buying cheap, used, "intermediate" range EV?

..... I'd also note that computers looked like they were in stasis to someone in the 1970s. The electronic computer was invented in the 1940s, but it wasn't until the late 1970s until they started to appear in homes. It wasn't until 20 years after that they became ubiquitous. It was 60 years from ENIAC to the world wide web. But in the short period from the early 1990s to the early 2000s, PCs went from business and hobbyist machines to something every person had in their home. I can see EVs getting to a similar tipping point even though they aren't there yet. I think we are still where PCs were in the mid-1980s: available, but still relatively expensive and limited for most. I would say the EV = computer analogy is quite imperfect. Compute...
by randomguy
Thu Feb 15, 2024 5:24 pm
Forum: Investing - Theory, News & General
Topic: Any studies to refute dividend yield & chill?
Replies: 161
Views: 12094

Re: Any studies to refute dividend yield & chill?

Dividends are irrelevant. They are forced stock sales that require you to pay taxes, and decreases the value of your underlying shares. And if they are located in Roth? What about those in a taxable account where the household is in the “sweet spot” of household income with their income streams meaning that they pay $0 taxes on their dividend income? What about those households that have balanced the dividend income between Roth and taxable to pay no taxes on those streams of income? We all have to deal with some level of dividend income (as well as coupons from bonds), so I would say they are relevant when it comes to managing a household’s income/spending, placement, amount, and tax planning. Not all households are in the same situation…...
by randomguy
Thu Feb 15, 2024 10:03 am
Forum: Investing - Theory, News & General
Topic: Any studies to refute dividend yield & chill?
Replies: 161
Views: 12094

Re: Any studies to refute dividend yield & chill?

An option for those who like a steady income is to take money from the portfolio and buy some SPIAs or set up a TIPS ladder understanding that the plan is to raid the wealth in the ladder only by liquidating the rungs as they mature and spending the dividends each year from the unexpired rungs. There are reasons academics have often urged annuitization in place of investment. I agree, but we would then need to bring in even more psychologists to figure out why people trust the stock market but don't trust insurance companies (for the annuity). It isn't a matter of trusting insurance companies as much as the risk reduction not being worth the cost. At 65 I am faced with the choice of either buying an annuity and getting about 4% for life or...
by randomguy
Thu Feb 15, 2024 9:43 am
Forum: Non-US Investing
Topic: UK investor - long dated gilts to reduce SORR: what am I missing?!
Replies: 34
Views: 4406

Re: UK investor - long dated gilts to reduce SORR: what am I missing?!

Hello Bogleheads community, I am a 40yo with an existing retirement portfolio of ~GBP 2m (comprised solely of VWRD). My wife and I plan to retire (or at least be in a position to slow down) in 17 years, when our last child finishes uni. So from 2041 onwards. I am looking into funding the first 10 years of our retirement (period 2041 - 2050) using long dated gilts. We estimate we would need ~GBP 70kpa (inflation adjusted) from 2041 - 2050 (i.e., GBP 700k over the 10 year period) and I could secure this today by purchasing zero coupon gilts which redeem over this period for ~GBP 385k. While I am not able to contribute much to the discussion regarding gilts I would like to point out that in 17 years your 100% equity portfolio will probably be...
by randomguy
Wed Feb 14, 2024 9:17 pm
Forum: Personal Consumer Issues
Topic: Concept 2 rower question [rowing machine]
Replies: 27
Views: 3312

Re: Concept 2 rower question [rowing machine]

Your pace is also heavily dependent on your height and weight. Taller and heavier rowers will be able to put out more power on the erg. 9 mins at age 60 is nothing to sneeze at when starting out. Don’t become one of those ‘I have 35 Million with $10 in expenses at age 23. Am I doing ok?’ posters. 😀 I wouldn’t have known either way but the vo2 max calculator estimates that to be 29, which is average, compared to 40-45 on all of the other activity calculators, with the caveat those are all just estimates. This chart has 9:00 as “novice” for a 60 year old https://rowinglevel.com/rowing-times/2000m-times#:~:text=What%20is%20a%20good%202000m,2000m%20time%20is%2005%3A35.8. As to being 60, I still have the illusion I should be able to do the same...
by randomguy
Tue Feb 06, 2024 8:43 pm
Forum: Investing - Theory, News & General
Topic: Collecting Social Security at 62 Leaves Me (and My Heirs) Better Off, Every Time
Replies: 143
Views: 14844

Re: Collecting Social Security at 62 Leaves Me (and My Heirs) Better Off, Every Time

Charles Joseph wrote: Tue Feb 06, 2024 1:04 pm

"You don't need money when you're dead. You do need it when you're alive, especially when you're very old."

"Don't be afraid to leave money on the table."

As per, Monsieur L'Orange, very wise and well said. Food for thought.
Sure I don't need money when I am dead. But my spouse does. My special needs kid might. And I would rather my estate feed 2000 kids instead of 1000. You need a very self centered world view to think everything ends when you die. Simplistic thought make for good quotes but they very rarely stand up to any level of inspection.
by randomguy
Tue Feb 06, 2024 12:27 pm
Forum: Personal Consumer Issues
Topic: Calculating a "true" SAT average admissions score
Replies: 67
Views: 5697

Re: Calculating a "true" SAT average admissions score

The only thing that is very hard to falsify or improperly influence are scores on standardized tests such as the SAT. One would have to hack a computer or pay a crack test-taker to impersonate one's kid. This is difficult and illegal. You haven't heard of SAT prep courses? They are going to do absolutely nothing to help you do course work in collage but will get you another 50-100pts on average. So basically everyone has to spend time doing something useless to try and have an even playing field... There is some youtube vid by a guy who did college in like 18 months by maximizing AP credits. He basically just optimized his studies to get 4s on the all tests. I am not sure if I should be impressed by his optimization or horrified by the ide...
by randomguy
Tue Feb 06, 2024 11:36 am
Forum: Personal Finance (Not Investing)
Topic: Anyway to get equity from my home without selling?
Replies: 25
Views: 2055

Re: Anyway to get equity from my home without selling?

csr wrote: Tue Feb 06, 2024 11:20 am
moneyzep22 wrote: Tue Feb 06, 2024 10:41 am we are behind over year on mortgage.
moneyzep22 wrote: Tue Feb 06, 2024 10:41 am my company, which i think will be worth millions in 5-10 years.
Something isn't adding up.
Plenty of success stories have the founders running low on cash/assets before making it. Of course there are the failures but they tend to write books.

Personally I take on the investor. If I give up 25% and my company is worth 10 million in 5-10 years, I am ok only having 7.5m. if the company fails, I would like to still have a house. Now if anyone will actually give you 200k for 25% is a whole other story....
by randomguy
Tue Feb 06, 2024 11:03 am
Forum: Investing - Theory, News & General
Topic: Collecting Social Security at 62 Leaves Me (and My Heirs) Better Off, Every Time
Replies: 143
Views: 14844

Re: Collecting Social Security at 62 Leaves Me (and My Heirs) Better Off, Every Time

Apart from Roth conversions, it's largely about the discount rate. BHs seem to think a small riskless number should be applied because the increases for waiting are guaranteed. Kitches says it makes no sense to assume in all your retirement calculations that your portfolio will grow at X% but the (taken early) SS contribution will only grow at a smaller "risk free" return. For me I don't think it will make much difference when I take it, so I plan to start at 65 when I sign up for Medicare. Simple. Good enough. (my full retirement age is 66 and 10 mo.) Here's a recent video from Rob Berger where Mike Piper explains why one should use the 20 yr TIPS rate as the discount rate. https://www.youtube.com/live/AQC0-vj6h5w?si=49A7FWObQVt...
by randomguy
Fri Feb 02, 2024 8:41 pm
Forum: Personal Consumer Issues
Topic: Emergency minivan replacement
Replies: 29
Views: 2874

Re: Emergency minivan replacement

For a misfiring van that otherwise runs, I would seek a second opinion. My next option with your finances would be option 3. 125,000 miles for an Odyssey or Sienna is just getting started. I’ve owned both. 125k is just getting started some of the time. But sometimes it is close to the end of the road. The question is how the OP feels about taking that risk. You sort of run into the same problem with a second opinion. If a guy says 3k of repairs will have it purring like new, how much faith do you have in that? People vary a lot on that. I know some people who would be hitting up the junk yard for a used engine to drop in and would have no qualms about driving it another 100k. I am in the group that doesn't feel super comfortable with that ...
by randomguy
Fri Feb 02, 2024 12:03 am
Forum: Personal Finance (Not Investing)
Topic: Another "Can I afford this house" thread
Replies: 55
Views: 5197

Re: Another "Can I afford this house" thread

It's not as crazy as it sounds. In my MCOL area (SLC, Utah suburbs) $2.5M isn't some crazy mansion, that's a totally normal home in many neighborhoods around me. "MCOL" is a very wide spectrum these days. If a 2.5M home is a “totally normal” home, it’s not a MCOL area anymore. I assume it is the HCOL subdivision in the MCOL area. I lived for a while in a LCOL area (think ~200k houses) where you had a couple gated communties (~600-800k houses) where the professionals lived and there were even a few more expensive sections where the rich lived with million+ houses. Where it becomes an issue is when you try to sell. In SF, there are 100k people looking to buy your 2.5m dollar house. In a LCOL you might have 100... The OP can afford ...
by randomguy
Thu Feb 01, 2024 11:46 pm
Forum: Personal Consumer Issues
Topic: Mechanical Protection Plans - anyone ever benefit from them?
Replies: 16
Views: 1472

Re: Mechanical Protection Plans - anyone ever benefit from them?

I'm going to present an opposite view on extended warranties but only if you buy cars new and hold them until at least 100k miles. Most people focus on the mechanical systems but forget that the main costs for repairs today are driven by the proliferation of electronic add-ons that usually are not repaired but replaced. It's easy to see a $2k - $3k bill for a damaged bumper with all the sensors and cameras in them today. If you can negotiate a decent price for a 8/80 or even 10/100 warranty it's pretty much guaranteed you will recover any expense and sleep better at night. They aren't going to cover accidents but yeah their is some question about the durability of all these systems over time. All those big LCD dashes look great but they ar...
by randomguy
Tue Jan 30, 2024 1:48 pm
Forum: Personal Consumer Issues
Topic: How do you retire when you love your work?
Replies: 163
Views: 12986

Re: How do you retire when you love your work?

Dear KBR (OP) - great thread! You seem really grounded but yet seeking input from those whose opinion you respect. I have no doubt you will make the correct decision when it's time. I read the full thread that was available first thing this morning, stepped out and now see it has exploded. I confess I only speed read when I returned an hour ago so apologies if this has been addressed. What does your partner (or if none) your family say? Not saying you should absolutely do what their opinion is, but this input is important. A very dear friend about my age (73) and his wife went walking 2-3 miles at a brisk pace 5x/wk. She was 5'2" and 95 lbs, fit and a nurse who ate well. Poster woman for fitness. My friend said he didn't want to retir...
by randomguy
Thu Jan 25, 2024 1:17 pm
Forum: Personal Consumer Issues
Topic: How do you retire when you love your work?
Replies: 163
Views: 12986

Re: How do you retire when you love your work?

Simply put, you don't have to retire if you like what you are doing. Don't let other people's opinions and experiences about retirement influence your own individual desires. I have to agree with this. And although I am not in the same situation as the OP, I can relate the experience of one of my former doctors that I think applies. I had a urologist for many years who continued to work well into his 80's. Sharp as a tack even at that age, well respected by his peers in the medical profession, and well liked and appreciated by his patients (including myself and DW). He scaled back his work hours over the years and finally retired somewhere in his mid-80's. Your post reminded me immediately of him. I'm sure he felt very much the same as you...
by randomguy
Tue Jan 23, 2024 10:44 pm
Forum: Personal Consumer Issues
Topic: Treadmills
Replies: 59
Views: 5508

Re: Treadmills

Thanks for the additional replies. I asked about a couple of units on FB marketplace and they took days to respond and were no longer available. I’m leery about having to move the thing and borrow/rent a truck and find help. Is almost just assume do the F63 and have it delivered and assembled. It’s in my wife’s court now. She was going to ask what her friend has. She will use it for walking not running. I’d perhaps use it for walking but I’m not go to pay extra for something to accommodate me. She’s average height medium build I’m 6 2 approx 200 The problem you are finding is that most people who have gone treadmill shopping are runners and they are projecting their needs onto you (i.e. all those 5k+ treadmills). That Sole is about as low ...
by randomguy
Tue Jan 23, 2024 12:42 pm
Forum: Personal Finance (Not Investing)
Topic: I don’t think I’m going to worry about RMDs. Terrible decision?
Replies: 39
Views: 4149

Re: I don’t think I’m going to worry about RMDs. Terrible decision?

It would probalby be a good idea to at least know (and tell us) what tax bracket your RMD's will put you in with todays laws and some reasonable estimate for investment growth. Yes laws could change but using up some of your 10% bracket early in retirement could be beneficial. Ok, you’re right. We have about $750k in tax deferred investments right now, and would hope to have $1-1.2 million in tax deferred when we retire in 2-5 years. The rest of our money is in Roths, cash, and taxable investments. The standard deduction for a married couple right now is $29,200, so that’s what we’d convert to Roths if we retired today. We’d convert whatever was the standard deduction at the time of our retirement in the future. If we assume we start with ...
by randomguy
Tue Jan 23, 2024 12:17 pm
Forum: Personal Consumer Issues
Topic: Treadmills
Replies: 59
Views: 5508

Re: Treadmills

I don't have one but was researching it and it is listed as 224 lbs out of the box, nearly 250 lbs in the box. If you get free curbside delivery you are going to need a few people to carry it inside or pay extra (I think $199) to get it inside. I'm coming to the conclusion that treadmills are a luxury and not something I'm likely to get. Maybe you can get away with a cheap one but between the size, weight and expense it might be a path I don't want to go down. Yeah, so definitely agree - treadmills are a luxury. I would bet most people buying a sub-$1000 treadmill will be unhappy. If you're not putting at least 100+ miles on it a year, I don't see the point in owning one. For a treadmill that you run on, I am agree 100% with you. if you ar...
by randomguy
Sun Jan 21, 2024 10:02 pm
Forum: Personal Finance (Not Investing)
Topic: No-state-income-tax states are not good for retirees.
Replies: 413
Views: 39168

Re: No-state-income-tax states are not good for retirees.

State income tax is just one piece of the equation as many others have stated. As recent retirees, we've enjoyed these features: CA has Prop 13, so I know without a doubt that my property tax will not increase year over year more than 2%. I have no idea how other states, like Texas, manage this for budgeting when the increase is at the whim of the local agencies. CA does not tax social security. For those fleeing to Colorado, they will face state taxes for over 20K. CA does not tax groceries. People fleeing to Idaho will face 6%. Ouch! Homeowners insurance runs <1K per year. Our fixed expenses are easy to understand. Mountains 3 hours north (skiing/hiking), the beach 2 hours west, the perks of a big city 90 minutes west. World famous viney...
by randomguy
Fri Jan 19, 2024 12:20 am
Forum: Personal Consumer Issues
Topic: How to get rid of car
Replies: 50
Views: 4699

Re: How to get rid of car

placeholder wrote: Thu Jan 18, 2024 11:20 pm
chinchin wrote: Thu Jan 18, 2024 10:40 pm
placeholder wrote: Thu Jan 18, 2024 10:26 pm
That's a bad idea for old cars and horrible idea for a near new one because at best if you deduct the entire amount you will get a best around 40% of the value back in taxes.
I am not trying to make money here. I want it gone ASAP
Why do you think it will be any faster or easier to donate than to call a reseller or the like?
And if you really hate dealers, I bet an ad on craigslist would have a dozen people will to take that car out if you price it 5k below FMV....
by randomguy
Fri Jan 19, 2024 12:17 am
Forum: Investing - Theory, News & General
Topic: Does Anyone Actually Run Down Funds in Retirement?
Replies: 361
Views: 49550

Re: Does Anyone Actually Run Down Funds in Retirement?

1) According to SSA.gov, the life expectancy of a 65 year old male in 1966 was 13.5 years for a male and 18.2 years for a female. 2) The value of a 60/40 portfolio with 0.1 expense ratio when run on cfiresim.com in 1976 using a 4% withdrawal rate adjusted for inflation ended up with a inflation adjusted portfolio of $498,645. According to the data above. That means by the time that person was 75 years old, they had a life expectancy of 3.5 years and 8.2 (male and female) with almost 12 years worth of portfolio left to live on. Life expectancy today is greater than what it was in the 60s and 70s. According to SSA.gov, the life expectancy for a male and female at age 65 is 16.94 and 19.66 years respectively. Also, I don't know if you find th...
by randomguy
Wed Jan 17, 2024 10:24 pm
Forum: Personal Finance (Not Investing)
Topic: Dealing with "one time" or "temporary" expenses when calculating X in 25X
Replies: 33
Views: 2825

Re: Dealing with "one time" or "temporary" expenses when calculating X in 25X

Things like cars and house improvements are regular expenses that you should account for. For things like cars I like to amortize it out (42k every 15 years? Call it a 3k/year expense). For a lot of the misc stuff I just use an average (spend 2k/year on unexpected stuff over the past decade. Don't really care if it was wedding presents or needing to get a tree cut down). There is a limit to how accurate you can be and if that unavoidable misc stuff is too much, I have plenty of discretionary stuff (vacation in for 7 days instead of 10. Cut out a couple of restaurant trips) to bring things back in line. At a certain level their is a limit to how accurate you can be.
by randomguy
Wed Jan 17, 2024 10:10 pm
Forum: Personal Finance (Not Investing)
Topic: No-state-income-tax states are not good for retirees.
Replies: 413
Views: 39168

Re: No-state-income-tax states are not good for retirees.

I’ve always wondered about this. Firstly, federal income tax is still a thing no matter where you live. So how big a deal is state income tax,really? I don’t plan to have much taxable income in retirement. So no state income tax is nice, but not amazing for me. But states have to fund themselves somehow. In Texas for example, the property tax and sales tax can be quite high…. So there’s that to consider. On the other hand, if you live someplace already that has really high state income tax, property tax, etc, I can see the benefit of moving. Seems a lot of people like to live in Delaware, as much for the taxes as the beaches. We have so many Bogleheads claiming to be avoiding all IRMAA surcharges and staying at 12% or under Federal income ...
by randomguy
Wed Jan 17, 2024 7:36 pm
Forum: Investing - Theory, News & General
Topic: Does Anyone Actually Run Down Funds in Retirement?
Replies: 361
Views: 49550

Re: Does Anyone Actually Run Down Funds in Retirement?

1) According to SSA.gov, the life expectancy of a 65 year old male in 1966 was 13.5 years for a male and 18.2 years for a female. 2) The value of a 60/40 portfolio with 0.1 expense ratio when run on cfiresim.com in 1976 using a 4% withdrawal rate adjusted for inflation ended up with a inflation adjusted portfolio of $498,645. According to the data above. That means by the time that person was 75 years old, they had a life expectancy of 3.5 years and 8.2 (male and female) with almost 12 years worth of portfolio left to live on. Life expectancy today is greater than what it was in the 60s and 70s. According to SSA.gov, the life expectancy for a male and female at age 65 is 16.94 and 19.66 years respectively. Also, I don't know if you find th...
by randomguy
Wed Jan 17, 2024 7:20 pm
Forum: Investing - Theory, News & General
Topic: Does Anyone Actually Run Down Funds in Retirement?
Replies: 361
Views: 49550

Re: Does Anyone Actually Run Down Funds in Retirement?

Here's what running out of money in retirement looks like in America: https://www.bogleheads.org/forum/viewtopic.php?p=7658723#p7658723 Unless I am missing something, she isn't running out of money. She never had money. From the OP original post, the people with reasonable SWR have all watched their net worth increase because over the past 50 years we have basically been in a bull market for stocks and bonds where if you invested remotely reasonably, your portfolio was going up faster than you were spending. But as soon as you get out of that "reasonable" case, of course people have money problems. When you start looking at median networths of 60-70 year olds and median incomes when working, it is pretty clear there will be tons ...
by randomguy
Tue Jan 16, 2024 2:19 pm
Forum: Investing - Theory, News & General
Topic: Bucket Withdrawal Strategy
Replies: 20
Views: 2446

Re: Bucket Withdrawal Strategy

Call_Me_Op wrote: Mon Jan 15, 2024 3:49 pm Why not just have 2 buckets - safe and risky. That's essentially what I do. You withdraw what you need and keep the desired ratio of safe/risky. Easy as can be, and addresses the behavioral issues.
The complexity of bucket schemes is when do you refill. When are you transferring money from your risk bucket to safe one? Do it too soon and you miss the rebound in stocks. Wait too long and you are at a high stock equity right as the next crash comes along. You will notice how few bucket articles talk about this other than giving useless advice of rebalance from stocks when they are up. The case where things are going good just isn't that interesting. Tell me what I am doing when stocks have been down for 10-15 years.....
by randomguy
Tue Jan 16, 2024 1:31 pm
Forum: Personal Finance (Not Investing)
Topic: Can Mom walk away from reverse mortgage home?
Replies: 13
Views: 2546

Re: Can Mom walk away from reverse mortgage home?

My understanding is that the reverse mortgage holder requires that the property be maintained in good condition. As has already been advised, get a copy of the mortgage document. In general yes but the next question is what can they do about it? They can foreclose on the house sell it and any excess money you end up with. If their is a deficit, you tend to be able to just walk away. Nobody wants to be in the business of suing old ladies and people with reverse mortgages tend not to be cash cows:). You would need to read the docs to see exactly what they spell out. To some extent you need to figure out the legal liability of when the bank needs to be told she is no longer living there and figure out how to dispose of the house (either you s...
by randomguy
Mon Jan 15, 2024 12:05 pm
Forum: Investing - Theory, News & General
Topic: How do you use Monte Carlo simulation and discussion on the limitation
Replies: 30
Views: 3056

Re: How do you use Monte Carlo simulation and discussion on the limitation

I have a question about inputs to the Monte Carlo and which option better approximate reality. When I run Monte Carlo on portfolio visualizer on anything with tips, the long term return drops significantly. This is because tips only start in 2001, so the simulation only run using data starting from 2001 which was terrible for equity. Should I better approximate reality by not running the simulation with tips and just assume it will be similar to bonds? My thought is more data is always better. Most Monte Carlo are being run on an asset class and not the actual asset. Portfolio visualizer only goes back to 1972. Are there Monte Carlo that go back further? It would be nice to have one that covers international stock ex us. Plenty of people h...
by randomguy
Sat Jan 13, 2024 3:04 pm
Forum: Personal Investments
Topic: Is anybody actually running out of money in retirement?
Replies: 201
Views: 46590

Re: Is anybody actually running out of money in retirement?

I can't say I was happy to learn of that since I'd be on the hook to pay it off, but the RM essentially set them up for life. They could go around the world 1000 times and be covered. I personally would never take up something I didn't understand, but my Dad understood such things and the RM has served them well. From what I gather, the precondition for a successful RM is to have a lot of equity in the home. If that is lacking, a RM probably is of limited utility. Why would you have to pay off the mortgage? If the house doesn't sell for enough, isn't that the banks problem? When both parents pass, the heir(s) have a choice of either paying off the loan and keeping the house, or selling the house and paying off the loan with the proceeds. I...
by randomguy
Sat Jan 13, 2024 1:14 pm
Forum: Personal Investments
Topic: Is anybody actually running out of money in retirement?
Replies: 201
Views: 46590

Re: Is anybody actually running out of money in retirement?

The government pays out way more than you put in. I figured out I put in at most 40k, and my employers the same. So 80k put in. I will get aver 50k per year at 70. The inputs and outputs do not match. Double check your calculations. To get $50k/year of SS benefits at age 70 you need to have had 35 years of income almost at the maximum that's taxed for SS. (About $158k/year will do it, in 2024 dollars. Do a quick check on https://www.ssa.gov/OACT/quickcalc/ with this level of income and age 70 collection.) SS tax is 12.4%, so you and your employer will have paid in 35 * $158k * 0.124 = $685k (in 2024 dollars). That is almost an order of magnitude larger than your $80k estimate. (It occurs to me that you may not be adjusting for inflation in...
by randomguy
Sat Jan 13, 2024 1:02 pm
Forum: Personal Investments
Topic: Is anybody actually running out of money in retirement?
Replies: 201
Views: 46590

Re: Is anybody actually running out of money in retirement?

roamingzebra wrote: Sat Jan 13, 2024 11:54 am

I can't say I was happy to learn of that since I'd be on the hook to pay it off, but the RM essentially set them up for life. They could go around the world 1000 times and be covered.

I personally would never take up something I didn't understand, but my Dad understood such things and the RM has served them well.

From what I gather, the precondition for a successful RM is to have a lot of equity in the home. If that is lacking, a RM probably is of limited utility.
Why would you have to pay off the mortgage? If the house doesn't sell for enough, isn't that the banks problem?