Search found 158 matches

by EHoops
Sun Jan 06, 2019 7:36 am
Forum: Personal Investments
Topic: Stopping 401k to buy up cash-flowing real estate?
Replies: 24
Views: 2346

Re: Stopping 401k to buy up cash-flowing real estate?

I think it’s a good plan if the rental market you are investing in is a good one; I have owned rentals for 20 years and it has been great. It is investing so keep that in mind — I say that because I have to remind myself that when I forego 401k contributions at times.

I’d encourage you to check out biggerpockets.com since that is a real estate forum where you will get RE ideas. Although there are several landlords on Bogleheads, I think you’ll receive some feedback about rentals being a headache, hard work, and not as good of an idea.

My experience in a college town that is a desirable place to live: rentals are amazing and I wish I had purchased many more when I was younger.

Best of luck.
by EHoops
Thu Dec 20, 2018 9:31 pm
Forum: Investing - Theory, News & General
Topic: I feel cheated, saved too much in 401K vs cash.
Replies: 74
Views: 13085

Re: I feel cheated, saved too much in 401K vs cash.

OP:

I agree with your sentiment and that’s why (I’m 46 with access to a good pension in 3 years) I’ve been focusing even more on RE. Same line of thinking. I live in a great area for RE and have owned rental properties for 20 years — the return is great and offers retirement income. We have some money in 401k accounts but have stopped contributing while we consider taxable investing to be able to pay off our house in addition to any good deals that pop up in RE.
by EHoops
Sat Aug 04, 2018 6:46 pm
Forum: Personal Finance (Not Investing)
Topic: Should I open a new CC to get 0% interest on a large purchase then cancel the card?
Replies: 5
Views: 872

Re: Should I open a new CC to get 0% interest on a large purchase then cancel the card?

We do it often — I just take good notes about each card and/or use the calendar in my phone to remind myself when to close each one.
by EHoops
Fri Feb 16, 2018 7:25 am
Forum: Personal Investments
Topic: 1031 Exchange
Replies: 1
Views: 409

Re: 1031 Exchange

Hi,

Congrats...I hope it works out. You may want to check out the Bigger Pockets site to gather ideas about 1031s...it’s a real estate-specific place with helpful people.
by EHoops
Thu Apr 27, 2017 6:45 am
Forum: Personal Finance (Not Investing)
Topic: what to do with our rentals ?
Replies: 8
Views: 1355

Re: what to do with our rentals ?

No taxes would be nice. You will have to pay for the depreciation so you'll want to ask your accountant about that amount, which could be significant if you've owned it a while.

A/C isn't incredibly expensive and the roof is an issue 5-10 years from now ( you say) plus there could be weather issues that help pay for the roof via insurance ( not sure where rental is located).

I own rentals and don't blame you for considering selling. It just sounds like you want to sell, which is completely fine.
by EHoops
Wed Apr 26, 2017 9:27 pm
Forum: Personal Finance (Not Investing)
Topic: what to do with our rentals ?
Replies: 8
Views: 1355

Re: what to do with our rentals ?

Sounds like good rentals to me yet also sounds as though you want to sell them. We don't know the rest of your financial situation. If you sell you'll pay taxes and the recapture of depreciation. Another option, if you don't want to manage them, is to hire a property manager if you can find a good one.
by EHoops
Fri Apr 07, 2017 7:43 am
Forum: Personal Finance (Not Investing)
Topic: Switching Jobs for less...Has anyone done this....
Replies: 46
Views: 5512

Re: Switching Jobs for less...Has anyone done this....

Yes, I gave up $30-40k to return to teaching. I feel less stressed, the work has more purpose, and I'm living what tell my kids to do rather than going after money.

Now, I had run the numbers and knew our lifestyle would be similar and that we'd receive some COL raises. And I have purchased rentals to change our income. But I'm glad I made the switch.

This video (it's a great book, Drive by Daniel Pink) cemented my decision and resonated with me at the time I was making the decision:

https://www.youtube.com/watch?v=u6XAPnuFjJc

Best wishes.
by EHoops
Thu Mar 30, 2017 11:59 am
Forum: Personal Finance (Not Investing)
Topic: Get $250 from Wells Fargo
Replies: 83
Views: 20675

Re: Get $250 from Wells Fargo

G-Force wrote:A $500+ Paypal deposit triggered the bonus for me.
I'm interested in knowing how this works. Can you explain it because I may choose to do this instead of the 10 debit card transactions?

Thank you.
by EHoops
Thu Feb 23, 2017 7:04 am
Forum: Investing - Theory, News & General
Topic: Deleted
Replies: 47
Views: 7529

Re: economics of landlording

Are you receiving the depreciation for the place on your taxes each year? I know some people don't know about this.

If you are and the rental does not cause you much stress, then it's an easy decision: keep it. The depreciation, cash flow, appreciation, and tax deductions make owning rentals in good locations a great choice.
by EHoops
Sat Feb 18, 2017 7:52 am
Forum: Personal Investments
Topic: No 401K and make over 200k
Replies: 15
Views: 2453

Re: No 401K and make over 200k

I'm no expert but I think you have some great options. I'd encourage you to buy "The Book on Tax Strategies for the Savvy Real Estate Investor" through the BiggerPockets forum (bet it's on Amazon, too)...great, easy read. Since it's early in 2017 I'd read it sooner than later. (Authors are Amanda Han and Matthew McFarland)
by EHoops
Wed Feb 15, 2017 6:58 am
Forum: Personal Finance (Not Investing)
Topic: How to fund repairs for a rental property
Replies: 7
Views: 1183

Re: How to fund repairs for a rental property

atshay8608 wrote:I own a rental property that is in need of about 30k in repairs, but I don’t have the liquid capital. Any recommendations on loan/funding options? It looks like HELOCs are not available on rental properties?
Thanks for any advice!
Why 30k? Maybe it would help if you listed what needs to be fixed and why. Are you making repairs and renovating because it's vacant? Knowing why you need so much money would help me offer ideas.

A HELOC and a 0% credit card were my first thoughts...
by EHoops
Sat Jan 28, 2017 5:18 pm
Forum: Personal Finance (Not Investing)
Topic: Need help with 3 rental properties I'm looking to purchase
Replies: 35
Views: 4846

Re: Need help with 3 rental properties I'm looking to purchase

The ONLY advantage to having an LLC is increased liability protection. If a tenant sues and you hold title, they are suing you, and your personal assets may be at risk if they win a big settlement. If a tenant sues and the LLC holds title, theoretically they can only go after the LLC's assets. There are no differences when it comes to taxation or deductions, and in fact there are disadvantages when it comes to getting a loan, as you mention. I don't recommend an LLC in general, unless you have lots of properties and/or millions in assets to protect. The reality is that an umbrella insurance policy and/or just getting a million in liability coverage on each rental property (via the regular hazard insurance policy) will work just as well - a...
by EHoops
Fri Jan 27, 2017 10:48 am
Forum: Investing - Theory, News & General
Topic: The Final, Definitive Thread on Brokerage Transfer Bonuses
Replies: 7765
Views: 1351626

Re: The Final, Definitive Thread on Brokerage Transfer Bonuses

I always do the transfer from the receiver. Generally there is no need to do anything at the current custodian. With Merrill Edge, you can do transfers from most of the larger brokerages online. Just open the new account, then go to the funding or transfer options in the menu. For all cash, I'm not sure exactly which you use. Frankly I wouldn't bother meeting with BofA. You should have an account with them so you can get Preferred Rewards. I don't look for custodians to pamper me. I'm there for the money and ready to go for the money. OP: Great thread and thanks for the consistent updates and help. I've historically used credit cards for rewards and free balance transfers. Brokerage bonuses is a new game that appeals to me. Alas, I have a ...
by EHoops
Mon Jan 16, 2017 8:03 pm
Forum: Personal Finance (Not Investing)
Topic: Worth keeping rental? (Numbers included)
Replies: 3
Views: 694

Re: Worth keeping rental? (Numbers included)

And you will be certain to depreciate the rental on your taxes, right? Another key benefit of rentals.

Is that the market rent for that area? I'm surprised it's not higher.
by EHoops
Sun Jan 15, 2017 9:10 am
Forum: Personal Investments
Topic: VTSAX or 457 -- Which choice is better and why?
Replies: 9
Views: 1654

Re: VTSAX or 457 -- Which choice is better and why?

radiowave wrote:Check and see if your 457 allows in service withdrawals if that is important to you. I had a choice of adding a 403b vs 457 and one of the deciding factors was the 403b allowed in service withdrawals and the 457 did not.
I don't believe so yet good idea. On a psychological level I like the idea of funds being inaccessible...but it's good to have options.
by EHoops
Sun Jan 15, 2017 6:56 am
Forum: Personal Investments
Topic: VTSAX or 457 -- Which choice is better and why?
Replies: 9
Views: 1654

Re: What to do with $85k in 'new' money? Need advice.

aristotelian wrote:I would go Option 3 if it wasn't for the fees. In effect you would be in a S&P500 fund charging .75%. I am not sure the benefit of deferring taxes is worth that premium. You save now but pay later. Unless you are getting an employer match, the tax benefit is a wash unless you are certain you will be in a lower tax bracket in retirement. If you aren't getting an employer match perhaps that is the case?
True, no employer match. And I'm not certain about the lower tax bracket at retirement, either. If I understand the fees for my 457 option, we'd pay $60 per $10k in addition to the quarterly fee of .15, which would be $75/year once we hit $50k...although that would take two to three years to accumulate $50k.
by EHoops
Sun Jan 15, 2017 6:35 am
Forum: Personal Investments
Topic: VTSAX or 457 -- Which choice is better and why?
Replies: 9
Views: 1654

Re: What to do with $85k in 'new' money? Need advice.

Goal33 wrote:I like option 3 but you may want to consider doing it over longer than 2 years depending on your marginal tax brackets. I.e if you are usually in the 25%, maybe only put enough money to defer at that level and don't just blindly contribute and end up deferring a bunch that would have been taxed at 15% anyway. Hope that made sense...
It does. I believe it would put us down into the 15% area. We have three kids in addition to the rental deductions and depreciation, so our taxes end up being very low. Good thinking and thanks.
by EHoops
Sat Jan 14, 2017 9:32 pm
Forum: Personal Investments
Topic: VTSAX or 457 -- Which choice is better and why?
Replies: 9
Views: 1654

VTSAX or 457 -- Which choice is better and why?

My wife and I may be selling a rental property (unique situation with no realtor fees) we own in the next two weeks and could clear $85,000 from the sale. We have thought of three options for this money, one of which would be rolling the $85k into another rental property but we'll omit that option for now. We have an emergency fund, max our ROTHs and 401ks, contribute a pittance each month to a 529, and have incredibly stable jobs as teachers. We also own two other rental properties that cash flow well; we intend to keep them. We'd like advice on our options and are thankful in advance for the insightful and generous help this forum provides. Option 1: VTSAX *Place the $85,000 in VTSAX and let it grow. We are both young and are aggressive i...
by EHoops
Sat Jan 14, 2017 7:17 pm
Forum: Personal Finance (Not Investing)
Topic: Get $250 from Wells Fargo
Replies: 83
Views: 20675

Re: Get $250 from Wells Fargo

I just applied and received the same confirmation as Loik98...
by EHoops
Wed Dec 28, 2016 4:10 pm
Forum: Personal Finance (Not Investing)
Topic: Turbotax Deluxe on sale at Amazon
Replies: 49
Views: 8619

Re: Turbotax Deluxe on sale at Amazon

I just purchased the Premier version through Sam's on the internet for $54.86 ($15 discount) and Amazon had the same price...free shipping.
by EHoops
Wed Dec 28, 2016 7:56 am
Forum: Personal Investments
Topic: Question on 529 or Home Equity
Replies: 4
Views: 878

Re: Question on 529 or Home Equity

I agree with CAsage's comments. I would want to know if there are 529 benefits (like state tax ones) in which case I'd consider funneling money through the 529 and back out.

The HELOC is a good idea and there are teaser rates which can be refinanced at the end of the term (say, every 18 months).
by EHoops
Wed Dec 28, 2016 7:51 am
Forum: Personal Finance (Not Investing)
Topic: Sell or Keep the rental?
Replies: 5
Views: 708

Re: Sell or Keep the rental?

I would keep the rental since it sounds as though it's going well. In addition to the cash flow and the appreciation of the property value, you are hopefully capturing the 3.63% tax depreciation each year (if you aren't the IRS will treat you as though you have been when you sell it).

I have found owning rentals to be relatively easy, aside from a few days each year, and a great financial boon.
by EHoops
Thu Dec 22, 2016 6:22 am
Forum: Personal Finance (Not Investing)
Topic: Getting loan to buy property, but also want to buy rental house
Replies: 6
Views: 1161

Re: Getting loan to buy property, but also want to buy rental house

To answer your first question, I don't think your HELOC will affect you much when looking to buy another rental property. If you have used any of it, I think they will calculate your monthly payment into debt/income ratio.

I don't have a good answer to your second question. You certainly seem intent on paying things off (first rental, now this land) and I suspect people on this board will want more information about your entire financial situation before offering good advice there.

Best wishes.
by EHoops
Thu Dec 22, 2016 6:01 am
Forum: Personal Investments
Topic: TLH to which fund?
Replies: 7
Views: 914

Re: TLH to which fund?

Livesoft: Thanks much...I always appreciate your insights.

Iceport: Yep, agreed on the idea/match. Thank you.
by EHoops
Wed Dec 21, 2016 6:54 am
Forum: Personal Investments
Topic: TLH to which fund?
Replies: 7
Views: 914

Re: TLH to which fund?

If that's not desired, it would seem — to me — that Vanguard Long-Term Tax-Exempt Fund Investor Shares (VWLTX) is *not substantially identical* to Vanguard High-Yield Tax-Exempt Fund Investor Shares (VWAHX).
Thanks. Are you referring to The Wizards's recommendation? That was VWITX and you mentioned VWLTX.
by EHoops
Wed Dec 21, 2016 6:44 am
Forum: Personal Investments
Topic: TLH to which fund?
Replies: 7
Views: 914

Re: TLH to which fund?

The Wizard wrote:VWITX...
Thanks. And is it wise to TLH if my losses are around $200?
by EHoops
Wed Dec 21, 2016 6:31 am
Forum: Personal Investments
Topic: TLH to which fund?
Replies: 7
Views: 914

TLH to which fund?

Hi,

I am using Roothy's thread [viewtopic.php?t=172568] to TLH a fund I have in taxable. My question is what is a good fund to TLH into...? VWAHX into _____?

Thanks for the help.
by EHoops
Sun Nov 06, 2016 6:20 am
Forum: Personal Finance (Not Investing)
Topic: Should I refinance investment property
Replies: 10
Views: 1936

Re: Should I refinance investment property

I think you should do it because at +$423/month you'll quickly make up for the costs...of course, what you do with the extra money each month matters. I now shop for best rates and closing costs so I would certainly encourage that...I've found a new bank in the city I live that offers incredible rates for investment properties and beats everyone in that regard.
by EHoops
Sun Aug 07, 2016 7:45 pm
Forum: Personal Finance (Not Investing)
Topic: Power of Attorney - legalzoom?
Replies: 7
Views: 1473

Re: Power of Attorney - legalzoom?

We have been using LegalZoom this summer for similar reasons and it's been great -- I've had three 30 minute phone conversations with an attorney in Denver (we live in Colorado).
by EHoops
Sun Mar 06, 2016 7:25 am
Forum: Personal Finance (Not Investing)
Topic: Next credit card for a bonus?
Replies: 109
Views: 21349

Re: Next credit card for a bonus?

We would fly out of Denver and our plan is to go to Spain...Barcelona and Madrid?...but we haven't made official plans other than a seven-day trip.
by EHoops
Sat Mar 05, 2016 7:32 am
Forum: Personal Finance (Not Investing)
Topic: Next credit card for a bonus?
Replies: 109
Views: 21349

Re: Next credit card for a bonus?

Last summer I got Chase Freedom, and in November I got Chase Sapphire Preferred. I am still working on the CSP bonus spending, but that will be finished in a couple weeks. In the mean time, I have an upcoming expense of $4,000 which I can put on a credit card. I don't want to miss this opportunity to earn some extra points. I am considering applying for one of the following cards: My wife and I plan to travel to Europe this summer; is the Chase Sapphire Preferred the best way to go? I am new to the travel credit card game so this has been interesting. I loved reading that some people try to get all or most of their trips paid for through credit card offers. What card should I pursue first to help with our Europe trip? Thank you in advance.
by EHoops
Sat Jan 16, 2016 8:17 am
Forum: Personal Finance (Not Investing)
Topic: Are 529s the best vehicle for college savings?
Replies: 51
Views: 9448

Re: Are 529s the best vehicle for college savings?

OP, 529s are just fine for the portion of savings you choose to allocate to college saving. But are you assuming you will not pay for any part of college from cash flow? I'm not sure that's the best route. Why not assume you'll cover 25-50% from cash flow and calibrate college savings based on that. Then you may be able to stuff more into retirement now. If you are a bit short when college comes, reduce retirement contributions during college. Reevaluate every few years. I agree with Pdxnative and think this is the best advice; putting more into retirement accounts now places you in a lower tax bracket. Your Roth contributions plus cash flow from working in your 50s would likely cover college costs. As you know, there are many unknowns whi...
by EHoops
Sat Apr 25, 2015 7:10 am
Forum: Personal Investments
Topic: Investing rental income?
Replies: 9
Views: 1421

Re: Investing rental income?

Artudee2 wrote:Rental property is almost paid off and was wondering what to invest the 1000$ a month into?
Or pull a HELOC and buy more rentals?
The answer would depend on what your goals are and your financial situation...among other things. Age, maybe, too.
by EHoops
Fri Apr 10, 2015 10:29 am
Forum: Investing - Theory, News & General
Topic: Do you think Ric Edelman is correct, never pay down mortgage
Replies: 407
Views: 111254

Re: Do you think Ric Edelman is correct, never pay down mort

ncole1 wrote:
EHoops wrote:I generally agree with Edelman's ideas and advice on this topic. I disagree with the word never, though. Generally it seems prudent to invest in stocks more than to pay off a mortgage.
Are you assuming that you'll hold no bonds?
We are 90/10 now and I contemplate going to 100% at times.
by EHoops
Fri Apr 10, 2015 10:19 am
Forum: Investing - Theory, News & General
Topic: Do you think Ric Edelman is correct, never pay down mortgage
Replies: 407
Views: 111254

Re: Do you think Ric Edelman is correct, never pay down mort

I generally agree with Edelman's ideas and advice on this topic. I disagree with the word never, though. Generally it seems prudent to invest in stocks more than to pay off a mortgage.
by EHoops
Fri Apr 10, 2015 10:07 am
Forum: Personal Investments
Topic: Should My Parents Switch Their Bond Funds?
Replies: 10
Views: 1300

Re: Should My Parents Switch Their Bond Funds?

midareff wrote:
EHoops wrote:
pkcrafter wrote:If tax bracket is 15%, then keep it. If higher, they might consider a tax exempt bond fund, but not long term.

Paul
Thanks, Paul. Would you suggest short-term, then, or something else?
The Intermediate Term Tax-Ex Fund is excellent.
midareff,

It sounds as though you'd make the switch to that fund.
by EHoops
Fri Apr 10, 2015 8:22 am
Forum: Personal Investments
Topic: Should My Parents Switch Their Bond Funds?
Replies: 10
Views: 1300

Re: Should My Parents Switch Their Bond Funds?

pkcrafter wrote:If tax bracket is 15%, then keep it. If higher, they might consider a tax exempt bond fund, but not long term.

Paul
Thanks, Paul. Would you suggest short-term, then, or something else?
by EHoops
Fri Apr 10, 2015 8:00 am
Forum: Personal Investments
Topic: Should My Parents Switch Their Bond Funds?
Replies: 10
Views: 1300

Re: Should My Parents Switch Their Bond Funds?

Call_Me_Op wrote:No, probably not. If this money is in a tax-deferred account, then definitely not.

Long-term tax-exempt has more risk than Total Bond - in the form of both credit risk and duration risk. If the money is in taxable, then considering intermediate tax-exempt is reasonable as a substitute.
Good catch, thanks. Their portfolio is in a taxable account.
by EHoops
Fri Apr 10, 2015 7:47 am
Forum: Personal Finance (Not Investing)
Topic: Which mortgage is better to pay off?
Replies: 18
Views: 2817

Re: Which mortgage is better to pay off?

I am in a similar situation and ponder your question at times, too...and I am not paying off either one. I believe in Edelman's advice yet I will stick to your either/or question. (Edelman: http://www.edelmanfinancial.com/educati ... g-mortgage)

I have a friend who makes a great living as a landlord and when I bring up the notion of paying off the rental mortgage he suggests that if I ever consider doing so (which he adamantly opposes), to put the money in a stock fund to allow the money to grow more quickly, keep liquidity, and then use the money to pay off the rental when the account is large enough.

Best wishes.
by EHoops
Fri Apr 10, 2015 7:39 am
Forum: Personal Investments
Topic: Should My Parents Switch Their Bond Funds?
Replies: 10
Views: 1300

Should My Parents Switch Their Bond Funds?

Hi,

My retired parents earn enough from SS and pensions to have extra $ each month, have an appropriate emergency fund, and no debt. My question concerns their bond fund which is the Total Bond one through Vanguard (they maintain a lazy, three-fund portfolio). Would it be wise to switch bond funds to, say, the Long-Term Tax Exempt to minimize federal taxes? I realize there is a bit more risk in this bond fund (it's a 3 on Vanguard's risk meter compared to the 2 for Total Bond).

Thanks for your help and advice.
by EHoops
Wed Jan 28, 2015 4:52 pm
Forum: Personal Investments
Topic: Would you pay off a mortgage or not to create more options?
Replies: 5
Views: 1170

Re: We'd like advice on our situation/plan.

It depends upon how you want to spend your time in retirement. Many people will pay off mortgage before retirement. Other people have different opinions. If you want to keep things simple, pay off your mortgage. If you do want to keep some mortgage and want to keep the rental property, you should pay off the one with higher interest first. However, many people do not want to handle a rental property if they want to retire "really". In my opinion, I would rather work one more year with my current job, than manage a rental property in retirement for many years (for the same benefits). Thanks. Managing the rental has been relatively easy for 15 years; I don't know if that will continue to be the case. I'm just looking to create a pl...
by EHoops
Wed Jan 28, 2015 11:13 am
Forum: Personal Investments
Topic: Would you pay off a mortgage or not to create more options?
Replies: 5
Views: 1170

Would you pay off a mortgage or not to create more options?

Emergency funds: We have one in place with sufficient funds. Debt: Our only debt is our home mortgage (owe approximately $319,500 at 3.625% with 27.5 years left) and a rental property (owe about $136,500 at 4.5% with 27.5 years left) Tax Filing Status: ( Marrie Filing Jointly) Tax Rate: 25% Federal, 4.63% State (I think we're 25% Federal...is that as simple as looking at total income on 1040 and then looking at table on Publication 505?) State of Residence: CO Age: Him 42, Her 33 Desired Asset allocation: 90% stocks / 10% bonds Desired International allocation: 10% of stocks Current total portfolio: low six figures Current retirement assets His 401k (adding $1500/month now, very low six figures)(60% of our total portfolio) Target Retirement...
by EHoops
Sat Jan 10, 2015 8:33 am
Forum: Personal Consumer Issues
Topic: make mortgage payment with a credit card?
Replies: 33
Views: 54334

Re: make mortgage payment with a credit card?

I use my Fidelity Amex card to load $1000 every month to my Serve account. $1000 is the max amount allowed for loading by credit card every month, at max of $200 per day. I then load $140 more using my checking account debit card and then pay my Wells Fargo mortgage of $1400. This gets me $20 cash back every month on my Fidelity Amex (pays 2% cashback). It is best to pay whole amount of the mortgage amount in one payment. I tried partial mortgage payments before ($1000 from Serve, the rest from checking account) and this resulted in the partial payments being applied to principal only, instead of being recognized as my monthly payment. So, would I need to do these three things to make this strategy work? 1. Open Fidelity® Investment Reward...
by EHoops
Wed Dec 17, 2014 1:03 pm
Forum: Personal Investments
Topic: Which is the better option: 457 or Taxable ETF?
Replies: 11
Views: 1436

Re: Which is the better option: 457 or Taxable ETF?

Backpacker, I don't understand your tax logic. If you assume the taxes on long term capital gains & qualified dividends (taxable account) is 15%, then the Op is in the 25% Federal tax bracket. If the Op was in the 15% Federal tax bracket there wouldn't be any Federal taxes on long term capital gains or qualified dividends from the taxable account ETF. You also didn't take into account withdrawing the money from the 457 account. Just comparing the Federal taxes on the gains (assuming long term cap gains & qualified dividends), from the 457, they would be taxed as ordinary income, let's say 15% or 25% depending on the Federal tax bracket. Those same long term cap gains & qualified dividends from the taxable account ETF would be t...
by EHoops
Wed Dec 17, 2014 7:34 am
Forum: Personal Investments
Topic: Which is the better option: 457 or Taxable ETF?
Replies: 11
Views: 1436

Re: Which is the better option: 457 or Taxable ETF?

Thanks for the replies. I'm not certain how to calculate our tax bracket/rate yet I realize this matters. Here is some information that I'm guessing is pertinent: 1) we itemize deductions, 2) we have three young children, and 3) we own a rental. Our house payment and the rental are likely the biggest reasons for allowing us to itemize. Thus, our effective tax rate (am I using the correct term?) is very low. If that is the case then does the ETF win in this scenario? I have been maxing my 401K although my wife does not. A primary motivation for the topic question is to create an accessible fund that we can access, along with my pension, when I can retire in 8.5 years. I've thought to build a fund that could be our house payment fund during m...
by EHoops
Tue Dec 16, 2014 9:23 pm
Forum: Personal Investments
Topic: Which is the better option: 457 or Taxable ETF?
Replies: 11
Views: 1436

Re: Which is the better option: 457 or Taxable ETF?

Quick question: Is this a governmental 457? If not, that will be a 457 killer for many on this board, for great reasons. It hasn't been for me, but my circumstances aren't typical. Hmm, I'm a teacher so I suppose it's a governmental 457. Why would this board respond poorly? Thanks. I would lean towards the 457. Say your tax rate on both long-term capital gains and qualified dividends is 15%. I think it's reasonable to expect the S&P 500 to return 5.00 annualized (before inflation). Your taxes would then be .75, so about the same as the fees for investing in the 457. But 5.00 nominal is probably on the conservative side. Your variable fees could also be lower. So then the 457 pulls aheads by a nose. I am leaning towards the 457. Can I a...
by EHoops
Tue Dec 16, 2014 9:01 pm
Forum: Personal Investments
Topic: Which is the better option: 457 or Taxable ETF?
Replies: 11
Views: 1436

Which is the better option: 457 or Taxable ETF?

Which option would be better:

A. investing in a 457 (Great-West S&P 500 Index Fund I) with fund fee of .60 and variable asset charge of .15 up to $50,000...so total fee is .75

OR

B. investing in taxable ETF (Total World Stock) with Vanguard -- at .05, of course

The purpose is to create a flexible fund for when I can retire in 8.5 years...ahead of my wife who is quite a bit younger. We max ROTHs and invest in our 401Ks, too.

Thank you.
by EHoops
Wed Dec 03, 2014 7:10 am
Forum: Personal Investments
Topic: teacher retirement plans and 403/457 limits
Replies: 13
Views: 2801

Re: teacher retirement plans and 403/457 limits

I would second what Ron said. The only point I'd emphasize -- I teach in Colorado -- is that a 401K is much better option than a 403/457 because of fees. I know many teachers at my school who invest in a 403b because there is a person who sells them...and the fees for it are outrageous but people typically don't pay attention to fees. So, I'd encourage you to look into that and my hunch is that your 401K is the best option...and, of course, pay attention to the fees within the 401k, too.

Best wishes.