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Thanks, he’s aware the new money is limited to $7,500 for 2023 and he’s working so no issues with the earned income. I was just wondering if he needed to let it stay in the account for any period of time before any new withdrawal.

My friend pulled 50k out of his Roth at 60 yo to buy a new house. If he starts putting money back into his Roth is there any additional holding period for new money? I assume no since he over 60 but I don’t think using a Roth like a bank is what they were intended for.

I’m pretty much the opposite of advanced user. I do like Excel but feel as I probably only use 5% of its features. If Microsoft were to come out with a reduced features option of office suite products for a onetime fee around $50 I’d likely switch back. I’m aware of the Home and Student version for $150 (no annual fee) and have considered it, but for now it’s Libre Office, I have to admit after using LO for a week I think I like LO just as much, these two spreadsheets are so similar.

Thanks for the responses, I use Excel at work and my old home computer had some version of an early Excel but was functional. All I wanted Libre Office for was to manage my personal spreadsheets, since I don’t plan to share them and I backup my files to my external hard drive I should be fine. I have started using Google Sheets at work and my only hesitation is I’m concerned about how confidential it really is. I’d prefer to just keep my spreadsheet offline.

My 15 year old Dell desktop has done its job well now sounds like a bad set of brake pads grinding when it starts up so I splurged and upgraded to a new computer. I was reluctant to purchase MS Office and I’m glad I did. After reading a few posts on this forum about Libreoffice I gave it a try…. Dang it’s nice and free

When you're older, simplifying your financial life is one of the best things you can do for your heirs. If Treasury Direct represents account number 3, 4, or 5, I'd think twice. Is the (possible) extra yield worth the hassle of having another account?

Exactly. +1

I jumped into the ibond party in 2020, even did the gift trick to load up. I’m now planning to exit if/when the rates drop. Main reason is I don’t want my heirs to have to try and figure out how to redeem the funds when I’m gone. Not worth the benefits in my situation. Just bought a 6 month T-Bill yesterday through my Fidelity account paying 5.03% APY, just don’t see any big advantages to ibonds anymore.

For anyone looking for a short term cash solution the latest 6 month T-Bill is paying 5.03% APY. Factor in my 6.8% state tax and that puts this TEY at 5.397% for me. Not sure you can get a better rate anywhere else.

Great question young man!!!!
A wise friend once told me there are 3 major decisions you will make in your life.
1, What you do for a career
2, Who you marry
3, What you do with Jesus
Get those 3 right and you’ll have a great life.

Here’s a bonus, take your family on a vacation every year whether or not you can afford it, doesn’t have to be expensive. As for investing, just read this forum every now and than.

Mabye he could buy your house and you buy his condo...?

Trust me the wheels are spinning in my head, he actually is looking to sell his townhouse anyhow or maybe rent it out. All his friends are near my home and he’s 15 miles away. (Bad decision on his part) maybe I just charge him a little rent while we’re gone in exchange for watching the house. Hate to just sell in case things don’t work out in Florida. Had a friend who moved to Arizona to be by his grandkids, son got a new job in a different state so now what?

I do have one son left in the area that could take care of any home issues, he could even sell his townhouse and live here while we’re gone so we do have options.
If my grandson wasn’t in Florida I wouldn’t be considering this.
As for downsizing, our home is on a cul-d-sac, on a small lake near Mpls/St Paul, very desirable property, I would hate to give it up just to downsize

I think that pretty much covers it except for the first year. For the first year, you may have to file partial year resident taxes in MN. This sounds like a pain, but tax software makes it pretty easy.

That’s what I was thinking, it’s still free country

Thanks increment,
I’m actually neutral on keeping the Minnesota home, it’s a big house that we don’t need anymore.

We have been thinking about this for awhile and are now looking for properties in Florida. Since our only grandchild is there it’s tough to be 1,000 miles away. Anyhow, we are planning to keep our home in Minnesota and purchase another home in Florida. Obviously we would make Florida our primary residence to save on taxes. A quick run of my numbers puts an extra $1k in our pocket every month. For those who have done this if we purchase a home, open a local bank account, switch our drivers license, register to vote, spend 183 days in Florida per year we should be good. Or is there more to this ?

About 7 years ago Fidelity was suddenly announced as our new and only work retirement brokerage option. We had 5 before including Vanguard. Being a longtime Vanguard investor I was pissed about the changes. Now I prefer Fidelity and when I retire will likely consolidate everything there. I don’t hate Vanguard but between the 2 I would now go with Fidelity.

I am starting to lean that way. I was typing up Treasury Direct instructions for my wife in case I get hit by the bus, and honestly, I might not want to keep TD as a permanent part of the portfolio. When the rates were high, I Bonds were a great alternative for the shorter term, but for longer-term inflation protection, I think TIPS would be more manageable (and would exist under one Fidelity roof with our other investments.)

I’m with you on this Tom T, I doubled up in 2022 to get the 9.6% rate while it lasted through gift bonds. In 2023 I’m leaning towards just gifting the Ibonds and selling off when my 12 months are up or maybe holding until the interest penalty is small.

Mr. Potter wrote: ↑Tue Jan 10, 2023 10:51 am FZDXX Fidelity Money Market Fund Premium Class. The first response was spot on, I would use the Money Market fund at either Fidelity or Vanguard or wherever you have a brokerage account. If I’m not mistaken the MM interest is a daily accrual so if you pull it out on the 29th of the month you would still get the interest you earned, not so with a HYSA. Are you saying you would forfeit some interest if you withdraw funds from a savings account before the end of the month or interest pay out date? Yep, pretty sure HYSA pay interest on either the average amount you’ve held for the month or some variation but if the account shows zero on payday you get nothing. A Money Market calculates interest diff...

FZDXX Fidelity Money Market Fund Premium Class.

The first response was spot on, I would use the Money Market fund at either Fidelity or Vanguard or wherever you have a brokerage account. If I’m not mistaken the MM interest is a daily accrual so if you pull it out on the 29th of the month you would still get the interest you earned, not so with a HYSA.

I placed some money with a financial advisor

Curious how much or what percentage is with this advisor? Just a thought but you could keep some money with this advisor and invest the rest and/or new money on your own, at least until you are confident.

Your issue there was uncompensated security-specific risk materializing for an individual stock

Aka as Y&D. Young and Dumb.
I have settled on VXUS in my Roth and VEA in my inherited IRA. That mix whatever the exact percentage is will be somewhere between 15-20% emerging markets. I’m good with that.

Northern Flicker, You must have access to my portfolio or something, very insightful comments and spot on. Two funds are fine. VEA+VWO will even give you a very slightly lower ER than VXUS. But the difference between 15% EM and 25% EM is not a significant difference. If you are this hesitant about EM, I suspect your int'l allocation is not particularly high, and suspect that you are fretting over whether EM is 3% or 5% of your total equities. Nonetheless, if you would lose sleep over unfavorable news about one or more of the larger EM countries, then just hold VEA for ex-US and rest easy. The difference between the two EM allocations in question with 24% of equities in ex-US: I am currently 90% US to 10% Int but planning to add new money to...

* you get to define what's meaningful to you, but it seems like you may be fooling yourself into thinking you're being smart/optimal when it really doesn't matter in this case

All I’m trying to do is establish an international strategy I can stick with over time. Pretty sure every single person on this forum is doing the exact same thing. I have no illusions I can outsmart the market, but most people realize that emerging markets are extremely volatile and in my situation I don’t need the extra risk, but I don’t want to completely ignore emerging either, thus the 15% is all I’m willing to risk. Will it make much difference, I doubt it but having 2 international funds vs 1 is not overly complicated.

I actually plugged in VTMGX and VTIAX into portfolio visualizer, the mutual fund version of the two funds to get a longer horizon. I do want some EM exposure but not the 25% in VXUS, I think I will settle on 85% developed and 15% emerging. There’s no right or wrong answer here, I was just looking for a little feedback. Thanks for the response’s.

Is the BIL a fiduciary?

No idea, to me this story reinforces the boring simple strategy of pick your AA, fund it every month and in 30 years you’ll be set for a nice retirement. Oh, and leave it alone. You know the bar of soap analogy, “The more you handle it the smaller it gets”

Many years ago (around 2003) my Merrill Lynch financial advisor recommended I invest in a portfolio of stocks that would mimic an index fund. I received hundreds of transaction statements for small lots ranging from 3 to 30 shares.

Funny you should mention Merrill Lynch, this guy told me his current investment company was formed from a handful of former ML advisor’s who started their own investment company.

BTW, I did throw everything at this guy, cost of having an advisor, if you can, Boglehead wiki etc. my friend dropped his son off at the airport yesterday and he said his son wanted to call me if that’s ok….. looks like this long story may have a happy ending after all.
Here’s looking to a great new year

I’m getting ready to add new money to my Roth and it’s going to international. As I compare VEA (developed) against VXUS (total) international, VEA has out preformed in pretty much every time scenario I ran. I understand the strong preference on this forum is to VXUS but I’m really curious as to why knowing VEA has had slightly better returns over decades with less risk.

Learn what stuff? Take what's left in IRA and buy a target date fund that matches his retirement date which costs $240 a year not $1000 a year (assuming $300k invested.) And gives him access to 12,000 stoccks and 14,000 bonds, automatically rebalances and reduces risk over time?

That sounds way too hard.

Anything is easy once you know how to do it. Having a brake job on a car is child’s play for anyone with a little mechanical ability. A shop will charge you $600-$1k. Same could be said about a guy who doesn’t maintain his own vehicles.

Would he be willing to take a moment for Bernstein's If you can?
https://www.amazon.com/If-You-Can-Mille ... 098878033X

I did mention this article to him but he said he would rather pay someone $1,000/ year than learn this stuff. Fair enough, than find someone to help that won’t rob you.

I have a Tbill maturing on 1/26. It will take one day to move it to my bank so I can make my purchase on 1/27. A little nervous I’m cutting it too close. What could go wrong?

Probably water under the bridge now, but it sure would be interesting to write up a spreadsheet tracking every step of the way and developing a story as to exactly what happened to that money. Maybe it could evolve into a book on how not to invest. On the other hand there are better things to do with one's time.

I could tell the guy was embarrassed and is ready to move on. Mentioned he had another “friend “ in the advisor business. Not sure he clearly heard me tell him repeatedly to go to Vanguard. BTW I only mention Vanguard because to me I think they would be the best fit for this guy. Anyhow, not sure he learned his lesson.

I finally spoke with the account holder (Son) last night. I only had a chance to see his statement but his wife’s is similar. He made some serious mistakes. 1, No plan (IPS) he just handed his advisor $300k and rarely if ever asked questions. 2, The advisor had free rain to invest in anything and buy/sell at will… which he did. The Son however did tell the advisor he wanted to be conservative but even that is not real clear direction. Conservative compared to what? 3, The Son got frustrated and stopped contributing during down markets. 4, Someone, probably his advisor convinced him that buying index funds was a mistake. 5, The advisor was charging .5% on AUM, which is actually cheap for advisor, my guess is there was some other method to ex...

If you purchase a discounted individual muni bond at say $90 and when it’s called/matures I assume you will be paid the par value which would be $100. Is this $10 increase taxed as cap gain? Ordinary income? Tax exempt? Or do I have this completely wrong?

Just read a bit on Seeking Alpha, looks like buying at a large discount is a mistake, if a guy buys near par you’ll be better off.

So, this is a $280,000 portfolio with 200 positions. An average of $1,400 per position. Talk about complex!

Actually the statement shows $140k and I believe it’s an IRA. Each position is between $200 to $5,000. The other $140 must be on a different statement or something and I assume that’s a taxable brokerage. Just waiting for this guy to wake up and explain a few details.

For anyone interested I just received the statement from my friends son. It’s bizarre, there’s at least 200 very small positions. For example, 1share of Apple, 2 shares of Exon Mobil, 2 Shares I-shares dividend etf…etc plus a random assortment of every flavor of bond etfs. The son just drove all night to get here so waiting for him to get out of bed. My advice is simple, call Vanguard, move everything and pay them their 30 basis points for management for now, later if desired learn to DIY. Unsure how this account lost money over the last 10 years, I’m only looking at a one month statement. Most likely explanation is buy/sell, churn, churn, churn. Just noticed the profile says CONSERVATIVE GROWTH & INCOME. Maybe this is just one big mutu...

In my situation SCHD has worked great. 10 years ago my Dad passed and left me his IRA, which in turn became my inherited IRA. The current 10 year liquidation rules weren’t in effect so I only need to take an RMD. I simply purchased SCHD with the entire amount. Since then the dividends have mostly covered the RMD and the principal has grown. Can’t ask for much more in an investment. Would I hold SCHD in a taxable account? Not unless I was in a very low tax bracket and even then probably not. The so called forced withdrawals work when you need to pull some money out anyhow. I like how the fund has a large cap value tilt, is not tech heavy, limits each fund to 4% max weight, .06 er and is rated 5-stars on Morningstar…. Seriously, what’s not to...

No retirement savings. FIL plan is to work til he's dead. FIL is an estate planning attorney.

Talk about irony, since they asked you to help and I’m guessing you’re happy to do I’d give it a shot. However, I’d be upfront telling them your advice is only as good as to how well you know the details of their complete financial situation. If they want to keep details out which is totally understandable then either send them to an advisor or get them a couple investing DIY books.

OP, any word yet on if my hypothesis above is what actually happened?

I’m getting this story second hand from my friend concerning his son so the details are a bit fuzzy. After I meet the son over Christmas I will report back with an update. Until then have a Merry Christmas to my Boglehead community.

He could lose a lot of money just niggling in and out of trades that lose a little and are sold, over and over again.

Yep, my thoughts exactly

Just an update on this post if anyone is interested. After handing his BIL 300k to invest in 2011 he did pull out 50k in 2012. He did however add that same 50k back to the original amount 6 months later. One thing that’s interesting is his investment statement is 40 pages long. Many small lots of individual stocks, almost wondering if the advisor was trying to create his own version of the TSM. Regardless, I will be meeting this guy over Christmas and will hand him one of my favorite books. “Investing Made Simple” by Mike Piper. I think it’s less than 100 pages and can be read in an hour. I’ve never seen a 40 page statement so either he has an 8 figure portfolio he didn’t mention or it’s crazy complicated. Interesting how we spend 70,000 ho...

OP, just curious is it just you and your sister? If so are you ok with your sister living in your moms home? At 65 it might be too late to worry about enabling your children. If your sister takes the home and you take the cash it might work out for everyone. My BIL just did this with his siblings and everyone was happy. At 90+ your mom has already beaten the average life expectancy by 10 years. No house payment would allow her to live on minimal income, if necessary get a renter in retirement.

Worth really pinning down Q1 in specific detail. I have had many taxpayers tell me that they “didn’t remove any funds”……. “Only dividends”

Totally agree.

This is usually where the story morphs into "well, I might have actually withdrawn a couple of hundred thousand dollars over that time, but..."

For the record this was the first question I asked my friend, if his son was pulling money out than there’s no mystery to solve here. If he did not take any withdrawals then his BIL/advisor has some explaining to do. I’m waiting for an update.

Q #1, Did he take any withdrawals? Answer, don’t think so.
Q#2, When did he invest this 300k? Answer, 2011/2012
Q#3, Was it lump sum? Answer, yes.

If this information is accurate then I have no logical explanation of what happened.

I think you have two paths to choose.
1, Educate yourself on how to invest your own money.
2, Pay someone else to do it for you.
This forum is dedicated to option #1 but it’s your call.

My friend mentioned his son was very risk adverse, I’m guessing he told the BIL to not lose it. My best guess is it was in some sort of cash investment and the advisor fees did the rest. I’m really curious what happen here, will come back with an update when I learn more.

I asked my friend to get a statement from his son. I’ll come back with an update when this mystery is solved.

Here's a simple scenario:
-Son gives 300k to BIL and says to be conservative and keep it "somewhere safe", because he doesn't really know anything about investing
-BIL keeps it in cash and charges his standard x% AUM fee
-Boom, 300k becomes 280k

You might be spot on, if true this is sickening.

Something is off here. Maybe the BIL forgot to invest it at all, kept it in a core savings account the entire time, and charged a 2% AUM for the service...

Agreed, I told my friend there’s no investment scenario I could think of that could have lost you money over this 10 year stretch.

What are the fees?

He thought the fees were .5 basis points

If we assume this was some sort of balanced portfolio it would have a balance of around 750k. Can fee’s really eat that much up? Did I mention his advisor is his BIL.

My friends son handed over $300k to his BIL who’s an advisor. After 10 years of a mostly bull market that 300k has turned into $280k. I have no idea what you could have invested in over those 10 years that would have a negative return. I’ve plugged both just cash and gold into portfolio visualizer and even that gets you around 330k.
How or what could explain this? Apparently this was a lump sum investment and no withdrawals were taken.