Search found 146 matches

by Phil DeMuth
Sat Oct 19, 2019 10:31 am
Forum: Personal Finance (Not Investing)
Topic: Legacy/Inheritance
Replies: 61
Views: 6598

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: 2913

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: 1356

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: 1399

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: 332

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: 3102

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: 9
Views: 1525

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: 11534

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: 13697

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: 19572

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: 2422

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: 38
Views: 7204

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: 3232

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: 3232

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: 1532

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: 31
Views: 3737

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: 1693

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: 1176

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: 4065

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: 2860

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: 1912

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: 2371

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: 1027

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: 8136

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: 1652

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: 60298

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: 3477

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: 3141

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: 11513

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: 4144

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: 5642

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: 2108

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: 6985

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: 4357

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: 3939

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: 10221

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: 5889

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: 5491

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: 1597

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: 4050

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: 4050

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: 3803

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...
by Phil DeMuth
Mon Aug 21, 2017 10:08 am
Forum: Personal Finance (Not Investing)
Topic: CFP vs MBA with focus in finance/management during career transition
Replies: 21
Views: 3036

Re: CFP vs MBA with focus in finance/management during career transition

One question I would ask is, how much could I expect to earn as a CFP (my guess: 5 figures) vs. if I applied the same energy pursuing an advanced degree in a field related to what I already know, e.g., petroleum engineering. Human capital compounds: if you can build off your current base you should ...
by Phil DeMuth
Tue Aug 08, 2017 9:46 am
Forum: Investing - Theory, News & General
Topic: Factor crowding
Replies: 19
Views: 2229

Re: Factor crowding

I thought that the "smart beta" funds amounted to < $1T of a ~$40T global stock market. Is this wrong? Remember that all the long overdue big flows into index funds are factor-neutral (except for the 'market' factor). And a lot of the flows from active managers to "smart beta" funds are simply excha...
by Phil DeMuth
Sat Aug 05, 2017 5:07 pm
Forum: Personal Finance (Not Investing)
Topic: Roth conversion in a high tax bracket?
Replies: 21
Views: 2505

Re: Roth conversion in a high tax bracket?

I think you should start at the end and work backwards. That is, with a probate attorney for your estate plan. We don't know how the law will change (if at all) this year, but your attorney should be able to give you a rough idea how your estate should be structured. Knowing that, you are in a posit...
by Phil DeMuth
Fri Aug 04, 2017 9:00 am
Forum: Investing - Theory, News & General
Topic: How to Account for Taxes - 25X Rule
Replies: 16
Views: 2620

Re: How to Account for Taxes - 25X Rule

RE: shifting stocks out of an IRA... I was assuming you had both a Traditional IRA and a taxable account of sufficient size that you could (1) sell the stocks inside the IRA, (2) buy bonds inside the IRA, (3) sell bonds inside the Taxable account, and (4) buy stocks inside the taxable account. This ...
by Phil DeMuth
Thu Aug 03, 2017 8:32 am
Forum: Investing - Theory, News & General
Topic: How to Account for Taxes - 25X Rule
Replies: 16
Views: 2620

Re: How to Account for Taxes - 25X Rule

Before retiring, you should do a pan-retirement tax analysis. Look at what happens to your brackets when you start SS, when you start your RMDs, and then overlay the same for your spouse. Also figure what happens if one of you die along the way and you have one standard deduction instead of two. Mos...
by Phil DeMuth
Fri Jul 21, 2017 10:38 am
Forum: Investing - Theory, News & General
Topic: Complex (profitable?) Roth Conversion Strategy
Replies: 23
Views: 2785

Re: Complex (profitable?) Roth Conversion Strategy

Very clever. Rather than aim for an arbitrary $100,000 annual conversion, it would be better to start with a projected pan-retirement tax analysis. If Joe is spending his entire retirement in the 15% bracket, there may be no point to converting any amount that will put him temporarily in the 25% bra...
by Phil DeMuth
Sat Jul 08, 2017 11:10 am
Forum: Personal Finance (Not Investing)
Topic: Does anyone use ANNUITIES for SOME of their retirement funds?
Replies: 61
Views: 5599

Re: Does anyone use ANNUITIES for SOME of their retirement funds?

What's curious about this is that while financial planning experts often recommend covering your core retirement expenses with annuities, the Boglehead community seems to cheerfully ignore this advice (apart from SS, which they were forced to buy). The experts speak of the "annuity puzzle," which is...
by Phil DeMuth
Fri Jun 23, 2017 2:18 pm
Forum: Investing - Theory, News & General
Topic: "Waiting for the Market to Crash is a Terrible Strategy"
Replies: 27
Views: 7010

Re: "Waiting for the Market to Crash is a Terrible Strategy"

Two corrections: Ben Stein's book did not recommend waiting for a 30% drop. Also, he did not panic during the crash.