Search found 154 matches

by Phil DeMuth
Wed Jun 03, 2020 1:22 pm
Forum: Personal Finance (Not Investing)
Topic: SECURE Act Estate Planning: T-IRA to Beneficiary vs CRUT?
Replies: 18
Views: 1453

Re: SECURE Act Estate Planning: T-IRA to Beneficiary vs CRUT?

Terrific article -- thanks for the link!

While the initial contribution to the CRUT would come out as ordinary income, is there any reason to favor investing for qualified dividends vs. investing for long-term capital gains? Would both be taxed to the beneficiaries the same way?
by Phil DeMuth
Sat Mar 28, 2020 3:46 pm
Forum: Personal Finance (Not Investing)
Topic: Estate planning recommendations: books, online courses, podcasts
Replies: 9
Views: 609

Re: Estate planning recommendations: books, online courses, podcasts

The forum is lucky to have a leading authority in the field (Bruce Steiner) as a regular contributor. I would search for his responses here to learn more about any area that interested me.
by Phil DeMuth
Sat Jan 11, 2020 3:03 pm
Forum: Personal Finance (Not Investing)
Topic: SECURE Act Estate Planning: T-IRA to Beneficiary vs CRUT?
Replies: 18
Views: 1453

SECURE Act Estate Planning: T-IRA to Beneficiary vs CRUT?

Has anyone looked at the pros/cons of using a CRUT vs. naming a person as the IRA beneficiary? I have seen cherry-picked "illustrations" showing the supposed advantage of the CRUT but no data on under what circumstances it is financially advantageous as a family wealth-transfer vehicle. When do the ...
by Phil DeMuth
Mon Jan 06, 2020 10:48 am
Forum: Personal Finance (Not Investing)
Topic: Tax Efficient Withdrawal Strategies - Call for Papers
Replies: 2
Views: 557

Re: Tax Efficient Withdrawal Strategies - Call for Papers

I don't think you will be able to nail this by reading a book or a paper, although you will gain an understanding of some of the issues. All the rules of thumb are wrong, or at least not necessarily right for you. The answer is entirely dependent on the exact specifics of your situation and your ass...
by Phil DeMuth
Thu Dec 12, 2019 2:54 pm
Forum: Personal Finance (Not Investing)
Topic: Appraising Art Work
Replies: 18
Views: 937

Re: Appraising Art Work

But please PM me if she happens to have a 1952 Fender Stratocaster in unplayed condition with hang tags on it -- I will pay you $100 for it sight unseen! :happy
by Phil DeMuth
Thu Dec 05, 2019 11:35 am
Forum: Personal Finance (Not Investing)
Topic: Retirees, which accounts do you consume first: Taxable, Deferred,...?
Replies: 37
Views: 3074

Re: Retirees, which accounts do you consume first: Taxable, Deferred,...?

Just to pile on with what everyone has been saying, there is no general answer. There is no rule of thumb. The answer depends entirely on the specifics of your situation.
by Phil DeMuth
Fri Nov 29, 2019 1:33 pm
Forum: Personal Finance (Not Investing)
Topic: Estimating Taxes During Retirement
Replies: 35
Views: 3632

Re: Estimating Taxes During Retirement

The Income Solver folks make a retail version called "Income Strategy" that is for single-use users. I don't mean to plug it -- if you know of something better, use it instead. The complexities of this go beyond what most people can do with Excel. See J. A. DiLellio and D. Ostrov, “Optimal Strategie...
by Phil DeMuth
Wed Nov 27, 2019 2:01 pm
Forum: Personal Finance (Not Investing)
Topic: Estimating Taxes During Retirement
Replies: 35
Views: 3632

Re: Estimating Taxes During Retirement

Estimating taxes in retirement is not easy. For one thing, what will the tax brackets be? Will TCJA be repealed next year by a new government, or will it expire in 2025, or be continued past then? What happens when our unfunded liabilities for SS and Medicare start to bite? (I do not mean to start a...
by Phil DeMuth
Sat Oct 19, 2019 10:31 am
Forum: Personal Finance (Not Investing)
Topic: Legacy/Inheritance
Replies: 61
Views: 7231

Re: Legacy/Inheritance

If you used the gift tax exemption years ago, it was undoubtedly less than the current $11.4MM (which could expire as soon as the end of 2020, depending on the political winds). It is time to revisit your estate plan with an attorney who routinely handles large estates -- not some guy you play golf ...
by Phil DeMuth
Wed Oct 09, 2019 12:28 pm
Forum: Investing - Theory, News & General
Topic: "Bogle on Mutual Funds" A Gem
Replies: 23
Views: 4283

Re: "Bogle on Mutual Funds" A Gem

The book that changed my life...
by Phil DeMuth
Fri Sep 20, 2019 9:32 am
Forum: Investing - Theory, News & General
Topic: Smallest market day portfolio change?
Replies: 13
Views: 1512

Re: Smallest market day portfolio change?

I notice that on Saturdays and Sundays the market volatility is extremely low. I may write a paper about this.
by Phil DeMuth
Sat Sep 14, 2019 10:41 am
Forum: Personal Finance (Not Investing)
Topic: Left Over 529
Replies: 9
Views: 1477

Re: Left Over 529

Although he might have a child of his own someday and appreciate that his kid's college is paid for. The money might be better spent on building your family's human capital than for consumption. Just a thought.
by Phil DeMuth
Thu Sep 12, 2019 11:09 am
Forum: Personal Finance (Not Investing)
Topic: Windfall Tax Optimization Ideas
Replies: 2
Views: 373

Re: Windfall Tax Optimization Ideas

Idea: a Charity Lead Annuity Trust. Example: You take an upfront charitable tax deduction this year, then the earnings (you pay the taxes on these) go to charity over the next 20 years, and finally you get a lump sum back in 20 years. PS the charity can be your Donor-Advised Fund. Since you already ...
by Phil DeMuth
Sat Aug 10, 2019 10:52 am
Forum: Personal Finance (Not Investing)
Topic: What is the best way to pass on wealth to heirs?
Replies: 30
Views: 3344

Re: What is the best way to pass on wealth to heirs?

Pre-fund 5 years worth of $15K contributions from you and from spouse to 529 plans for kids and/or grandkids...
by Phil DeMuth
Fri Aug 09, 2019 10:44 am
Forum: Personal Finance (Not Investing)
Topic: US and state income tax calculator
Replies: 10
Views: 2511

Re: US and state income tax calculator

This site is now open for beta testing. Federal + State in one.

http://www.nber.org/taxsim/taxsim32
by Phil DeMuth
Fri Jul 05, 2019 11:28 am
Forum: Personal Finance (Not Investing)
Topic: Preparing my wife for financial life without me.
Replies: 95
Views: 12328

Re: Preparing my wife for financial life without me.

The Time: 5 years from now Setting: Your wife is at a cocktail party, where a handsome young stockbroker is the center of attention. A week later, she is sitting across the desk from him as he thoughtfully looks over your statements from Vanguard. Stockbroker: "Yes, yes...I see exactly what (your na...
by Phil DeMuth
Fri May 31, 2019 10:08 am
Forum: Investing - Theory, News & General
Topic: [Nominal] Annuities are a bet on future inflation rates and should not be purchased by retirees
Replies: 183
Views: 14326

Re: Annuities are a bet on future inflation rates and should not be purchased by retirees

Just to stir the pot: Wouldn't one really want an annuity indexed to CPI-E, which is the rate of inflation experienced by the elderly? Also, what about standard of living? You could have a real annuity that completely fails to keep up with the rising standard of living. In thirty years people could ...
by Phil DeMuth
Sun May 19, 2019 1:03 pm
Forum: Personal Finance (Not Investing)
Topic: Seeking comment on proposed revisions to Marginal Tax Rate and Traditional v. Roth wiki articles
Replies: 419
Views: 23010

Re: Seeking comment on proposed revisions to Marginal Tax Rate and Traditional v. Roth wiki articles

Thank you for your hard work putting together this wiki. I do not understand the advice under Very High Earners to the effect that they should generally prefer Roth accounts. Do we mean that they should prefer to own Roth accounts? That would be true. Do we mean that they should prefer to contribute...
by Phil DeMuth
Sun May 19, 2019 11:39 am
Forum: Investing - Theory, News & General
Topic: Constructing Tax Efficient Withdrawal Strategies for Retirees
Replies: 13
Views: 2640

Re: Constructing Tax Efficient Withdrawal Strategies for Retirees

An important implication of this article, which also agrees with the Reichenstein/Meyer, is that discovering the retiree drawdown strategy with the highest utility cannot be done by following simple rules of thumb. It involves a complicated calculation that also entails many assumptions. The odds of...
by Phil DeMuth
Sun Apr 07, 2019 10:34 am
Forum: Personal Finance (Not Investing)
Topic: Has anyone used Income Strategy website/software?
Replies: 53
Views: 13878

Re: Has anyone used Income Strategy website/software?

I have spent the past year working with Income Solver, the Income Strategy software for financial advisors. There is a learning curve so here are my thoughts: I recommend starting with i-ORP, which is free. Once you have that down and a good understanding of the inputs and outputs and how they work ...
by Phil DeMuth
Mon Mar 25, 2019 11:02 am
Forum: Investing - Theory, News & General
Topic: Who discovered sequence of returns risk?
Replies: 47
Views: 3474

Re: Who discovered sequence of returns risk?

OP here: I would like to thank everyone for their illuminating comments and the many great leads to investigate this further. The practical issue of how to address SORR is interesting and I don't think it has a definitive answer. For any solution someone cooks up, we will all be able to imagine scen...
by Phil DeMuth
Fri Mar 22, 2019 7:05 pm
Forum: Investing - Theory, News & General
Topic: Who discovered sequence of returns risk?
Replies: 47
Views: 3474

Who discovered sequence of returns risk?

In 2004 I used Monte Carlo to simulate 10,000 25-year retirements with a 5% annual withdrawal. I became curious whether the portfolios that ran out of money in under 25 years had anything in common. I was struck how the first one to go bust (out of 10,000) had the following sequence of returns: Year...
by Phil DeMuth
Tue Jan 08, 2019 10:58 am
Forum: Personal Finance (Not Investing)
Topic: When did tax planning become important for you?
Replies: 20
Views: 1626

Re: When did tax planning become important for you?

I recommend the Income Solver tax planning software for the best retirement drawdown tax planning. The software is not for the faint of heart and frankly, I would pay them a one-time fee to run the analysis for you. Not sure if they still offer this service but you could always ask. https://www.inco...
by Phil DeMuth
Fri Sep 07, 2018 10:53 am
Forum: Personal Finance (Not Investing)
Topic: Fee only Financial planners
Replies: 32
Views: 4614

Re: Fee only Financial planners

I have been looking for a fee-only CFP financial planner for years with no success. In other words, someone who would provide a financial plan using standard industry software but NOT propose to take over the client's asset management. The first guy I used (from NAPFA -- strictly fee-only!) tried to...
by Phil DeMuth
Mon Dec 04, 2017 10:59 am
Forum: Personal Finance (Not Investing)
Topic: Taxes in Retirement: Resources?
Replies: 11
Views: 1739

Re: Taxes in Retirement: Resources?

The best resource I have seen is Robert Keebler's Tax Rate Evaluator spreadsheet, which will be available from AICPA once the new tax rates are ironed out. The cost will be several hundred dollars. Reichensten will sell you a total personalized retirement withdrawal solution for a handsome fee at re...
by Phil DeMuth
Fri Dec 01, 2017 2:12 pm
Forum: Personal Finance (Not Investing)
Topic: Experiences with Alliant Credit Union
Replies: 6
Views: 1313

Re: Experiences with Alliant Credit Union

I recently got their cash-back Visa card. The online sign up was among the worst experiences I have had dealing with a financial services company. I've forgotten (repressed?) all the hassles I went through. My favorite part was getting an email telling me that my application had been denied a week a...
by Phil DeMuth
Wed Nov 29, 2017 11:20 am
Forum: Personal Finance (Not Investing)
Topic: Taxes in Retirement [ways to forecast]
Replies: 30
Views: 4209

Re: Taxes in Retirement [ways to forecast]

If you're really serious about this, you should either -- 1) Get the Gold Edition of the Keebler Tax Rate Evaluator spreadsheet from AICPA. This costs a few hundred bucks. I don't think it is available right now but will be once we see what the new tax world looks like. In any case, I would not buy ...
by Phil DeMuth
Wed Nov 22, 2017 11:14 am
Forum: Investing - Theory, News & General
Topic: Minimizing capital gains assuming FIFO basis
Replies: 26
Views: 3017

Re: Minimizing capital gains assuming FIFO basis

I don't see how transferring the security to a different brokerage account helps. All the tax lot data transfers over. And to the extent that it worked, wouldn't the IRS look at facts and circumstances and dismiss this as a fraudulent stepped transaction, with attendant consequences for the taxpayer...
by Phil DeMuth
Tue Nov 21, 2017 10:59 am
Forum: Investing - Theory, News & General
Topic: Tax Basics Cheatsheet?
Replies: 9
Views: 1964

Re: Tax Basics Cheatsheet?

As someone who loves cheatsheets, I am distressed to say that I don't think there is one for taxable accounts. The management of these accounts can be fiendishly complicated (should I do tax gain harvesting or do a partial Roth IRA conversion this year?, for example). To the extent that you are high...
by Phil DeMuth
Tue Nov 14, 2017 11:51 am
Forum: Investing - Theory, News & General
Topic: Do DFA advisors get kickbacks?
Replies: 11
Views: 2464

Re: Do DFA advisors get kickbacks?

I haven't been to a DFA-sponsored conference in years, but as I recall you are lucky to get as much as a 19-cent plastic ball point pen out of them.
by Phil DeMuth
Sun Nov 12, 2017 10:35 am
Forum: Investing - Theory, News & General
Topic: Total Stock Market replication divided into dividend/non-dividend sub components
Replies: 5
Views: 1060

Re: Total Stock Market replication divided into dividend/non-dividend sub components

I think Bogle's original idea was that people would hold the Growth index during their working years and then switch to the Value (i.e., dividend-rich) index when they retired. I think there is something to this. But he noted that the performance of the two indexes had been very close, historically....
by Phil DeMuth
Sat Nov 11, 2017 12:18 pm
Forum: Investing - Theory, News & General
Topic: Split the Equity allocation 50% US / 50% International
Replies: 55
Views: 8504

Re: Split the Equity allocation 50% US / 50% International

The issue is not intellectual (which would default to 45/55 US/Foreign) but psychological: tracking error tolerance. My clients read the Wall Street Journal. When International stocks outperform domestic, they say, "Great job, Phil, really love those international stocks." When international stocks ...
by Phil DeMuth
Thu Nov 09, 2017 10:57 am
Forum: Investing - Theory, News & General
Topic: Wes Gray: Do Trend Folowing Managed Futures Increase Safe Withdrawal Rates?
Replies: 14
Views: 1724

Re: Wes Gray: Do Trend Folowing Managed Futures Increase Safe Withdrawal Rates?

It makes sense, because managed futures shine during the worst times, and safe withdrawal rates are about eliminating the 1% of worst-case scenarios. But people can't stick with managed futures as a separate portfolio line item because they have lots of long periods with lousy returns. The real prob...
by Phil DeMuth
Sat Nov 04, 2017 12:04 pm
Forum: Investing - Theory, News & General
Topic: [Yahoo Finance no longer works - Alternatives to download securities quotes]
Replies: 289
Views: 63862

Re: Excel Macro using Yahoo Finance- not working

I am Yahoo Finance user frustrated by my inability to download monthly historical prices in Excel or R. I am currently working around it in various ways using Quandl and Tiingo, but neither is as versatile as the old Yahoo Finance was. 1) Is there any hope that Yahoo Finance will return to its forme...
by Phil DeMuth
Wed Nov 01, 2017 11:03 am
Forum: Investing - Theory, News & General
Topic: Global Market Portfolio as a single ETF?
Replies: 28
Views: 3820

Re: Global Market Portfolio as a single ETF?

I believe that I was the first kid on the block to offer the global market portfolio as a one-click purchase option:

https://www.folioinvesting.com/folioinv ... bal+Market
by Phil DeMuth
Mon Oct 30, 2017 10:51 am
Forum: Personal Finance (Not Investing)
Topic: How to choose an estate lawyer
Replies: 37
Views: 3324

Re: How to choose an estate lawyer

Another factor to consider is: how complicated are your estate planning needs? If it is likely that you will not be subject to estate tax, like 99% of U.S. citizens, and you don't live in a state that taxes estates or bequests, then your needs are more modest and don't need Darth Vader to come up wi...
by Phil DeMuth
Tue Oct 24, 2017 10:11 am
Forum: Investing - Theory, News & General
Topic: Building very high net worth
Replies: 81
Views: 12110

Re: Building very high net worth

>> As to who the rich are in America, he shows that they are overwhelmingly white, married, highly educated, older, and self-employed, most likely in finance or business and professional services. <<

from a recent article I've lost the link to....
by Phil DeMuth
Sun Oct 01, 2017 11:29 am
Forum: Personal Finance (Not Investing)
Topic: Tax Strategy for Timing of Early Retirement with Significant Long-Term Capital Gains
Replies: 41
Views: 4301

Re: Tax Strategy for Timing of Early Retirement with Significant Long-Term Capital Gains

You should do a long-term tax projection of your post-retirement life, taking into account the effect of rising RMDs from your qualified accounts. Only then can you estimate whether you are better off using your early retirement low income years for tax gain harvesting or Roth conversions. If possib...
by Phil DeMuth
Thu Sep 28, 2017 11:46 am
Forum: Personal Finance (Not Investing)
Topic: Tax saving strategies for DINKs
Replies: 47
Views: 5866

Re: Tax saving strategies for DINKs

This is a tough situation. Make sure you only buy super tax-efficient funds in your taxable investment account.

Consider also: buying a couple of goldfish and claim them as your children? This can be very profitable unless/until you are audited....
by Phil DeMuth
Tue Sep 26, 2017 9:51 am
Forum: Investing - Theory, News & General
Topic: Financial History Books
Replies: 15
Views: 2161

Re: Financial History Books

No one writes with more flair about Wall Street history than John Brooks. He was a New Yorker columnist back in the day, and there are several books of his collected columns. Highly recommended (Buffett and Gates are two fans).
by Phil DeMuth
Mon Sep 25, 2017 10:47 am
Forum: Investing - Theory, News & General
Topic: Warren Buffett Books
Replies: 55
Views: 7285

Re: Warren Buffett Books

The Lowenstein bio is the best. Then I would read "The Essays of Warren Buffett" by that professor who edits his letters by topic.

You can be an A+ Boglehead investor without reading a word of Buffett. That said, he is an investing god.
by Phil DeMuth
Mon Sep 25, 2017 10:41 am
Forum: Investing - Theory, News & General
Topic: Selling Taxable to Top of Bracket: What does it mean?
Replies: 33
Views: 4423

Re: Selling Taxable to Top of Bracket: What does it mean?

I would recommend that you do a 15-year tax projection instead of trying to plan this year-by-year. The RMDs start small but ramp up over time and investors typically and expensively and needlessly jump brackets during retirement. If you see that rising RMDs are going to push you into the 25% bracke...
by Phil DeMuth
Sat Sep 23, 2017 12:44 pm
Forum: Investing - Theory, News & General
Topic: Roth Conversion and Strategy
Replies: 25
Views: 4050

Re: Roth Conversion and Strategy

The following article by Sumutka and Coopersmith might be of interest:
http://www.iarfc.org/documents/issues/Vol16Issue1.pdf
by Phil DeMuth
Sat Sep 23, 2017 12:39 pm
Forum: Personal Investments
Topic: Help?! My 70 year old father is 100% invested in equities
Replies: 79
Views: 10718

Re: Help?! My 70 year old father is 100% invested in equities

There are millions of stories of gullible seniors getting fleeced by their high-priced advisors in the naked city. This doesn't strike me as one of them. If it is any consolation, one day you will probably inherit far more money from your father than you otherwise would have thanks to his aggressive...
by Phil DeMuth
Mon Sep 11, 2017 10:08 am
Forum: Investing - Theory, News & General
Topic: What is the "safe, safe" withdrawal rate?
Replies: 38
Views: 6046

Re: What is the "safe, safe" withdrawal rate?

There is no such thing as a safe withdrawal rate. There is no such thing as a risk-free asset. For any scenario I propose that will give you a certain cash flow over X years, you will be able to point out a scenario or perhaps twenty scenarios where it fails. I don't mean to say that some aren't mor...
by Phil DeMuth
Sun Sep 03, 2017 1:40 pm
Forum: Personal Finance (Not Investing)
Topic: Reverse Mortgage Line of Credit
Replies: 44
Views: 5639

Re: Reverse Mortgage Line of Credit

It looks like as of Oct 1 2017 FHA/HUD is pulling the plug on the features that made the HECM LOC too good to be true

http://www.investmentnews.com/article/2 ... gage-rules

https://portal.hud.gov/hudportal/docume ... 7-12ml.pdf
by Phil DeMuth
Wed Aug 30, 2017 9:56 am
Forum: Personal Finance (Not Investing)
Topic: tax / estate planning for parents
Replies: 16
Views: 1638

Re: tax / estate planning for parents

1) Estate attorney 2) Asset location: park bonds in qualified accounts and stocks in taxable accounts to prevent RMD bracket creep later in retirement, if it looks like that will be a problem. 3) Not sure if Roth conversions make sense if there is already a big pension plan payout operating. On the ...
by Phil DeMuth
Sat Aug 26, 2017 10:18 am
Forum: Personal Finance (Not Investing)
Topic: Should I abandon airline credit cards for cash back?
Replies: 34
Views: 4183

Re: Should I abandon airline credit cards for cash back?

Thank you all for this terrific range of replies and opinions. This is exactly why the Bogleheads forum is a national treasure. I will go cash back for now and then see how it goes trying to use my existing Money Bin of miles, probably using a service to find flights for me. If it goes well I can al...
by Phil DeMuth
Fri Aug 25, 2017 11:38 am
Forum: Personal Finance (Not Investing)
Topic: Should I abandon airline credit cards for cash back?
Replies: 34
Views: 4183

Should I abandon airline credit cards for cash back?

I am thinking of abandoning my airline miles rewards credit cards (Chase, Amex) for simple 2% cash back cards. My only interest is using airline miles for international business class travel, and these seats now seem impossible to get. Even if I log in at midnight 331 days out (or whenever the seats...
by Phil DeMuth
Thu Aug 24, 2017 9:57 am
Forum: Personal Finance (Not Investing)
Topic: Is a Major House Remodel Worth It?
Replies: 21
Views: 4017

Re: Is a Major House Remodel Worth It?

You have no idea what the remodel will cost until you finish the demo. It could be 2X your current estimate in the blink of an eye. Would you still be glad then? Vs. moving to a better 'hood? Of course, moving is also expensive -- at least 10% of the house's sale price. This sounds like a job for Ex...