Search found 3833 matches

by David Jay
Mon Oct 16, 2017 6:25 pm
Forum: Investing - Theory, News & General
Topic: Roth as good as you think?
Replies: 13
Views: 1588

Re: Roth as good as you think?

I doubt many 25 or 30 year olds can predict what their future tax bracket will be when they retire at ,say, 65. True, but some people have a hint: 1. If your are in the 39% tax bracket, go with tax deferred. 2. If you are making 8 bucks an hour (like my youngest), do a Roth. (Oh, and take the saver...
by David Jay
Mon Oct 16, 2017 5:16 pm
Forum: Investing - Theory, News & General
Topic: Roth as good as you think?
Replies: 13
Views: 1588

Re: Roth as good as you think?

The Wiki does the same calculation (and confirms your result) here: https://www.bogleheads.org/wiki/Traditional_versus_Roth So it really does come down to tax bracket at contribution versus tax bracket at withdrawal. The issue that is sometimes over-looked is that RMDs can easily push retirees into ...
by David Jay
Mon Oct 16, 2017 2:16 pm
Forum: Personal Finance (Not Investing)
Topic: couple of questions regarding inflation and the 4% rule
Replies: 7
Views: 504

Re: couple of questions regarding inflation and the 4% rule

I understand the "4% rule" as something along the lines of...you can withdraw 4% of your portfolio value in year 1 of retirement, increase withdrawal each year based on inflation, and you have a high (95%-ish) chance of success over a period of 30 years. I'm aware that 3.5% may be the new 4% and th...
by David Jay
Mon Oct 16, 2017 2:03 pm
Forum: Investing - Help with Personal Investments
Topic: Making a Roth IRA for my Dad
Replies: 16
Views: 576

Re: Making a Roth IRA for my Dad

Does he have a 401K or other deferred savings plan at work? If so, he can dump $18,000 a year into that (and replace those living expenses with taxable funds) for the next couple of years. That's the fastest way to build up his tax-advantaged space. He can roll that money over into a Roth later if i...
by David Jay
Mon Oct 16, 2017 1:45 pm
Forum: Personal Finance (Not Investing)
Topic: Social Security payouts vs. "estimated benefits" online
Replies: 36
Views: 1721

Re: Social Security payouts vs. "estimated benefits" online

As someone else referenced once you have earnings past the 2nd bend point ($2.25M Index earnings) the differences for future earnings will have limited impact to your benefits. $100K indexed earnings = $35.70/mo in FRA benefits past the 2nd bend point. (Earnings /420 * 15%) And even that assumes yo...
by David Jay
Mon Oct 16, 2017 12:38 pm
Forum: Personal Finance (Not Investing)
Topic: Social Security payouts vs. "estimated benefits" online
Replies: 36
Views: 1721

Re: Social Security payouts vs. "estimated benefits" online

Up through age 60, but with a two-year delay because of how long it takes to gather accurate wage data, one's future benefit is adjusted for the wage index. Starting from age 62 benefits are adjusted per CPI-W. Am I correct that this creates a window of vulnerability for early retirees? If there is...
by David Jay
Sun Oct 15, 2017 9:41 pm
Forum: Personal Finance (Not Investing)
Topic: Social Security payouts vs. "estimated benefits" online
Replies: 36
Views: 1721

Re: Social Security payouts vs. "estimated benefits" online

Yes, if you have 35 years at max contribution, you should receive in excess of $3000 a month at Full Retirement Age (FRA).

Increases for inflation are based on a wage index, not on cost of living per say. But if wages go up 2% per year, your projections are reasonable.
by David Jay
Sat Oct 14, 2017 7:37 pm
Forum: Investing - Help with Personal Investments
Topic: ETF index funds for hesitant Retiree
Replies: 7
Views: 590

Re: ETF index funds for hesitant Retiree

delamer wrote:
Sat Oct 14, 2017 5:39 pm
You might show her this, and see where her comfort level is:

https://personal.vanguard.com/us/insigh ... llocations
^^^ This!
by David Jay
Sat Oct 14, 2017 1:06 pm
Forum: Investing - Help with Personal Investments
Topic: ETF index funds for hesitant Retiree
Replies: 7
Views: 590

Re: ETF index funds for hesitant Retiree

The key questions are: What is her need, ability and willingness to take risk. It is hard to comment intelligently without knowing her expenses and the size of the portfolio. If she has $3M and only needs $75,000 a year for living expenses then she has no need to take any risk. If she has $1M and ne...
by David Jay
Sat Oct 14, 2017 8:44 am
Forum: Investing - Help with Personal Investments
Topic: inservice rollover to IRA?
Replies: 7
Views: 369

Re: inservice rollover to IRA?

If you are over 59.5 and live in Florida then there is no big advantage to keeping the funds in the employer accounts. I would look at fund choices and ERs at the margin (I did a rollover of my 401k within a week of turning 59.5 but I had poor fund choices in my small company 401K), but in the end i...
by David Jay
Sat Oct 14, 2017 8:32 am
Forum: Investing - Help with Personal Investments
Topic: Investing in private companies
Replies: 17
Views: 1154

Re: Investing in private companies

With regard to the comment below about not buying at least a 51% stake, this is likely going to be impossible for you. The investors who acquire such a stake are going to be the sophisticated institutional players who will also demand (and obtain) board presence as a condition of their investment. ...
by David Jay
Sat Oct 14, 2017 8:00 am
Forum: Investing - Help with Personal Investments
Topic: My EJ portfolio vs my Vanguard, side by side
Replies: 27
Views: 3016

Re: My EJ portfolio vs my Vanguard, side by side

I'm curious about the taxes. I suspect you didn't withdraw from either portfolio the money needed to pay the taxes on the annual distributions. Your tax returns, especially Schedule B should be enlightening. In some respects, if EJ caused you $10,000 extra annually in taxes over Vanguard, then it w...
by David Jay
Fri Oct 13, 2017 7:00 pm
Forum: Personal Finance (Not Investing)
Topic: Roth conversions...did I miss the boat?
Replies: 6
Views: 990

Re: Roth conversions...did I miss the boat?

If you had sizable pre-tax dollars in a Traditional IRA what would be your Roth conversion strategy today (if any)? It all comes down to taxes: 1. Your current marginal tax rate 2. Marginal tax rate between retirement and start of Social Security 3. Marginal tax rate after start of SS and before st...
by David Jay
Fri Oct 13, 2017 5:02 pm
Forum: Investing - Help with Personal Investments
Topic: Investing in private companies
Replies: 17
Views: 1154

Re: Investing in private companies

First, never purchase less than 51% of a privately held company. You have virtually no control or liquidity as a minority owner. Pooling resources in a partnership in order to purchase control of a small company may work out. Be certain that everything is spelled out clearly in the partnership docum...
by David Jay
Fri Oct 13, 2017 3:45 pm
Forum: Investing - Help with Personal Investments
Topic: My EJ portfolio vs my Vanguard, side by side
Replies: 27
Views: 3016

Re: My EJ portfolio vs my Vanguard, side by side

First guess - underperformance by International in recent years. At 40% of stocks (32% of portfolio) the VG account appears to have about 12-13% more international than EJ.
by David Jay
Fri Oct 13, 2017 2:37 pm
Forum: Investing - Help with Personal Investments
Topic: Need help with current market (voo,vti)
Replies: 48
Views: 1940

Re: Need help with current market (voo,vti)

Markets are at-or-near all time highs about 60% of the time. So by definition it is completely normal for broad market funds to be "really high and about as high as they have ever been". True, I just dont want to risk buying high and then later it dips real low in price , so I was thinking bonds an...
by David Jay
Fri Oct 13, 2017 10:43 am
Forum: Personal Finance (Not Investing)
Topic: 2018 SS COLA contest
Replies: 7
Views: 769

Re: 2018 SS COLA contest

TLC wrote:
Fri Oct 13, 2017 8:30 am
David Jay wrote:
Thu Oct 12, 2017 9:21 pm
Do you know if 2016 AWI comes out at the same time? It has been issued in October in recent years
The AWI for 2016 was reported today to be 48,664.73.
source: https://www.ssa.gov/oact/cola/awiseries.html
Thanks, I saw your other post will all the numbers...
by David Jay
Fri Oct 13, 2017 8:35 am
Forum: Investing - Help with Personal Investments
Topic: Diversify IRAS?
Replies: 3
Views: 151

Re: Diversify IRAS?

To clarify, concentration is not wrong. I have a (small) concentration in Small Company Value. But I understand that by overweighting (also called "tilting" around here) that I am making an informed "bet" on the SCV proposition. The most important thing about overweighting is to believe enough in yo...
by David Jay
Fri Oct 13, 2017 8:23 am
Forum: Investing - Help with Personal Investments
Topic: Diversify IRAS?
Replies: 3
Views: 151

Re: Diversify IRAS?

The TR2060 fund is fully diversified. It holds US stocks, International stocks, US bonds and International bonds. You are free to overweight some sector that you feel will provide better (or less correlated) performance in the future, but understand that what you will be doing is the opposite of div...
by David Jay
Thu Oct 12, 2017 10:38 pm
Forum: Investing - Help with Personal Investments
Topic: Advice on Retirement Investments: IRA? High-Expense Govt 457b?
Replies: 12
Views: 708

Re: Advice on Retirement Investments: IRA? High-Expense Govt 457b?

Thanks. Would it be smarter to open a standard IRA and fund it instead of the Roth? (The logic being that my federal tax bracket might be lower when I retire, so I should take advantage of a tax savings now?) I honestly think I'm likely to remain in the 25% bracket (assuming brackets remain as they...
by David Jay
Thu Oct 12, 2017 9:21 pm
Forum: Personal Finance (Not Investing)
Topic: 2018 SS COLA contest
Replies: 7
Views: 769

Re: 2018 SS COLA contest

Alan:

Do you know if 2016 AWI comes out at the same time? It has been issued in October in recent years. My wife turned 60 in 2016 so that is the only number needed to calculate her PIA (she will not have any additional years with income).
by David Jay
Thu Oct 12, 2017 9:10 pm
Forum: Personal Finance (Not Investing)
Topic: annuity beneficiary
Replies: 5
Views: 274

Re: annuity beneficiary

I would ask for a prospectus for the annuity. Typical expenses for a variable annuity are 2.5% per year.
by David Jay
Thu Oct 12, 2017 9:08 pm
Forum: Personal Finance (Not Investing)
Topic: annuity beneficiary
Replies: 5
Views: 274

Re: annuity beneficiary

Welcome to Bogleheads. The choice is not simple, it depends on a lot of things but mostly on your tax bracket and the amount of the lump sum. Investing the money yourself will be much lower cost than keeping the money at the insurance company. So it is necessary to weigh the cost of taking it out no...
by David Jay
Thu Oct 12, 2017 8:28 pm
Forum: Investing - Help with Personal Investments
Topic: Advice on Retirement Investments: IRA? High-Expense Govt 457b?
Replies: 12
Views: 708

Re: Advice on Retirement Investments: IRA? High-Expense Govt 457b?

Welcome to Bogleheads. You may want to visit the Wiki for an overview of BH thinking on the "Starter Kit" page here: https://www.bogleheads.org/wiki/Bogleheads%C2%AE_investing_start-up_kit 1. Because of the high costs of the 457 offerings, I would fund the Roth first and put the remainder of your re...
by David Jay
Thu Oct 12, 2017 8:01 pm
Forum: Investing - Help with Personal Investments
Topic: Need help with current market (voo,vti)
Replies: 48
Views: 1940

Re: Need help with current market (voo,vti)

Markets are at-or-near all time highs about 60% of the time. So by definition it is completely normal for broad market funds to be "really high and about as high as they have ever been".
by David Jay
Thu Oct 12, 2017 7:14 pm
Forum: Investing - Help with Personal Investments
Topic: 2050 Target Retirement Fund
Replies: 11
Views: 1394

Re: 2050 Target Retirement Fund

My son has his Roth IRA exclusively in the VG 2050 TDF. It's done well for him in the 7/8 years he's been investing in the fund. I don't believe he has any reason not to continue to invest in the fund every year. A regular contributor here at BH by the name of "neurosphere" has a signature line tha...
by David Jay
Thu Oct 12, 2017 1:19 pm
Forum: Investing - Help with Personal Investments
Topic: Balancing vs. Momentum Investing:
Replies: 4
Views: 348

Re: Balancing vs. Momentum Investing:

I would not listen to any "expert" who recommends holding more stocks than your IPS specifies, but especially at this point in the market cycle.

If 60/40 is your target allocation, rebalance to 60/40.
by David Jay
Thu Oct 12, 2017 1:13 pm
Forum: Personal Finance (Not Investing)
Topic: Amazon survey scam
Replies: 4
Views: 750

Re: Amazon survey scam

pintail07 wrote:
Thu Oct 12, 2017 12:01 pm
Beware of receiving an email asking for you to take a survey and receiving a free gift, total scam.
I no longer trust any email as being from the claimed sender. Spoofing an email "from" address is child's play.
by David Jay
Thu Oct 12, 2017 9:55 am
Forum: Investing - Help with Personal Investments
Topic: 2050 Target Retirement Fund
Replies: 11
Views: 1394

Re: 2050 Target Retirement Fund

There is no special reason for the Vanguard Roth to be "balanced." ^^^ This. Your asset allocation should be measured across all of your accounts, it is not necessary (or even useful) to try to balance inside of each account. Some accounts are better used for certain types of investments (i.e. taxa...
by David Jay
Tue Oct 10, 2017 8:45 am
Forum: Personal Finance (Not Investing)
Topic: Does IRS life expectancy table change?
Replies: 10
Views: 1208

Re: Does IRS life expectancy table change?

Keep in mind that RMD percentages are based on longevity, and longevity is increasing. So any changes will likely reduce the percentage.

(without going too far down the rabbit hole, perhaps that is part of the reason why the IRS is slow to revise the numbers...)
by David Jay
Tue Oct 10, 2017 8:35 am
Forum: Personal Finance (Not Investing)
Topic: Schwab money market fund for my mom? How safe?
Replies: 5
Views: 357

Re: Schwab money market fund for my mom? How safe?

One would think that you could purchase government insured CDs from within her Schwab account.
by David Jay
Mon Oct 09, 2017 6:02 pm
Forum: Investing - Theory, News & General
Topic: Probably a very simple investing principle but....
Replies: 22
Views: 1972

Re: Probably a very simple investing principle but....

Two points:

1. Few here would recommend a 100% stock portfolio for a new investor with a lump sum.

2. There has never been a 55% year-to-year drop in the history of the stock market (see 100% in the attached). https://www.vanguard.com/us/insights/sa ... llocations
by David Jay
Sun Oct 08, 2017 7:19 pm
Forum: Investing - Theory, News & General
Topic: New Fiduciary Rule seems to be a big disappointment
Replies: 17
Views: 1925

Re: New Fiduciary Rule seems to be a big disappointment

I have a Merrill Edge account and I'm able to invest in no load funds. Is that a taxable account or a retirement account (401/403/457/IRA)? Strictly speaking, the fiduciary rule has been propagated by the DOL for retirement accounts. [edit] (yes, I know that the DOL is trying to extend it further...)
by David Jay
Sun Oct 08, 2017 1:39 pm
Forum: Personal Finance (Not Investing)
Topic: Change for a $20 requires ID!!
Replies: 22
Views: 2267

Re: Change for a $20 requires ID!!

Ruger wrote:
Sun Oct 08, 2017 11:13 am
My understanding is that the $20 is the one most often counterfeited, so I guess they are being overly cautious.
Did you hear the one about the innumerate artiste?

He created an absolutely perfect counterfeit of the ... wait for it ... one dollar bill.
by David Jay
Sat Oct 07, 2017 12:14 pm
Forum: Personal Finance (Not Investing)
Topic: Cash balance plans and self directed IRAs
Replies: 3
Views: 295

Re: Cash balance plans and self directed IRAs

For the second topic, what did you want to do within the self-directed portion? If it is public securities (stocks, bonds, options, etc.) then all you need to do is transfer a portion of your IRA to a new custodian, presumably a low-cost brokerage house like TDAmeritrade, Schwab, etc. All transactio...
by David Jay
Fri Oct 06, 2017 2:48 pm
Forum: Investing - Help with Personal Investments
Topic: Frequent Trading Question...
Replies: 3
Views: 477

Re: Frequent Trading Question...

Nothing like Bogleheads when you're squawking 7700
by David Jay
Fri Oct 06, 2017 2:01 pm
Forum: Investing - Theory, News & General
Topic: I'm thinking about cashing completely out of equites....
Replies: 75
Views: 8045

Re: I'm thinking about cashing completely out of equites....

Rick Ferri has called 30/70 (stocks/bonds) the "sweet spot" for retirees, with enough stock exposure to keep ahead of inflation while being relatively well insulated from market movements. But I agree with others, no sudden moves. My personal IPS says I will not change my asset allocation by more th...
by David Jay
Thu Oct 05, 2017 11:59 am
Forum: Investing - Help with Personal Investments
Topic: Help with In-Laws Request to Review their Portfolio from LPL Advisor
Replies: 8
Views: 776

Re: Help with In-Laws Request to Review their Portfolio from LPL Advisor

V.A. costs (policy fees+ fund fees) are typically more than 2% per year. That is a lot of drag on performance...
by David Jay
Thu Oct 05, 2017 11:46 am
Forum: Personal Finance (Not Investing)
Topic: Is it possible to buy TOO LITTLE house? Is buying a home in a HCOL actually cheaper than a LCOL?
Replies: 14
Views: 1240

Re: Is it possible to buy TOO LITTLE house? Is buying a home in a HCOL actually cheaper than a LCOL?

If I could go back 20 years, I would make a number of different investment choices.

But it probably wouldn't be more house, it would probably be Amazon (IPO was May 1997)

(see the first quote on my signature line below)
by David Jay
Thu Oct 05, 2017 11:38 am
Forum: Investing - Help with Personal Investments
Topic: Delayed Distribution Annuity
Replies: 2
Views: 231

Re: Delayed Distribution Annuity

A lot depends on the size of the annuity. If it is small then it doesn't matter. My wife inherited an annuity that paid about $2000 a year for 4 or 5 years. No big deal, only about $1200 was taxable each year. If it is substantial (say, tens of thousands of dollars) then withdrawing everything in on...
by David Jay
Wed Oct 04, 2017 6:29 pm
Forum: Investing - Help with Personal Investments
Topic: Comparing fund NAVs and returns
Replies: 7
Views: 471

Re: Comparing fund NAVs and returns

Think of the NAV as the size of the container as away to visualize this. If the NAV of an SP500 fund is $100 and another SP500 fund is $25 then I like to think of it as the first fund is selling a "gallon" of SP500 and the other fund is selling a "quart" of SP500. Same stuff, different amount in the...
by David Jay
Wed Oct 04, 2017 11:41 am
Forum: Investing - Theory, News & General
Topic: Mutual fund vs ETF prices
Replies: 15
Views: 1171

Re: Mutual fund vs ETF prices

Yes, because you have a volume measurement system (gallons, quarts, pints, cups, ounces...) for milk. But, as I said above, there is no established volume measurement for Mutual Funds and ETFs. So every price is based on a arbitrary volume of holdings. That is why you can't get what you want. Why i...
by David Jay
Wed Oct 04, 2017 11:34 am
Forum: Personal Consumer Issues
Topic: camping trailer...need to change vehicle?
Replies: 44
Views: 2625

Re: camping trailer...need to change vehicle?

Rupert wrote:
Wed Oct 04, 2017 11:02 am
Have you considered the Cricket? https://taxaoutdoors.com/ultra-light-tr ... r-trailer/
Do you want to live in a Cricket for 3 months with 6 year old and 8 year old boys?
by David Jay
Tue Oct 03, 2017 10:00 pm
Forum: Investing - Theory, News & General
Topic: The Future of Active vs Index Investing
Replies: 33
Views: 2492

Re: The Future of Active vs Index Investing

I mean there was no staying the course with Enron, Lehman, Kodak, more recently Equifax, etc.. I wonder how many passive funds were forced to hold on to these companies when it was pretty clear the future was very bleak. For every active manager who sold those companies on the way down, there was a...
by David Jay
Tue Oct 03, 2017 9:49 pm
Forum: Investing - Help with Personal Investments
Topic: Shifting 100% Stock → 35% Stock & 65% Bonds / REITs
Replies: 52
Views: 6081

Re: Shifting 100% Stock → 35% Stock & 65% Bonds / REITs

Getting in and out of the market based on your instincts virtually guarantees underperformance. As Bernstein says: "...mistiming the market is probably the most frequent and severe form of permanent capital loss"

All the best, but I fear for your portfolio...
by David Jay
Tue Oct 03, 2017 8:48 pm
Forum: Investing - Help with Personal Investments
Topic: Help Rebalancing 401k Allocation
Replies: 6
Views: 407

Re: Help Rebalancing 401k Allocation

That being said, a Target Date fund may be appropriate. BH member "neurosphere" has the signature line: "If you don't know if a Target Date fund is right for you... it is." Don't select by date, select by bond allocation (i.e. select a fund with 15% bonds, not necessarily the date when you expect to...
by David Jay
Tue Oct 03, 2017 8:35 pm
Forum: Investing - Help with Personal Investments
Topic: Help Rebalancing 401k Allocation
Replies: 6
Views: 407

Re: Help Rebalancing 401k Allocation

To get a little more history of TRP's retirement funds try comparing TRP vs. Vanguard 2030 fund including the 2007/8 great recession. Small difference at the trough, and TRP has outperformed since. http://quotes.morningstar.com/chart/fund/chart?t=TRRCX®ion=usa&culture=en_US&dataParams=%7B%22zoom...
by David Jay
Tue Oct 03, 2017 5:53 pm
Forum: Investing - Theory, News & General
Topic: The Future of Active vs Index Investing
Replies: 33
Views: 2492

Re: The Future of Active vs Index Investing

That also raises an interesting question, when something like this happens as with Equifax where the market cap suddenly decreases by 40-50% overnight or in a matter of few days, when is it that index funds actually "rebalance" to maintain the new cap weights. Or generally is there a percentage amo...
by David Jay
Tue Oct 03, 2017 1:53 pm
Forum: Investing - Help with Personal Investments
Topic: Help Rebalancing 401k Allocation
Replies: 6
Views: 407

Re: Help Rebalancing 401k Allocation

You can get close to a "3-fund" (it takes 4 because there is no Total US) style portfolio with your options. First, you need to pick your international percentage. 25% to 33% is common, but some people feel strongly that they don't want any international. I will use 25% and let you adjust to suit. F...
by David Jay
Tue Oct 03, 2017 9:11 am
Forum: Investing - Theory, News & General
Topic: The Future of Active vs Index Investing
Replies: 33
Views: 2492

Re: The Future of Active vs Index Investing

I mean there was no staying the course with Enron, Lehman, Kodak, more recently Equifax, etc.. I wonder how many passive funds were forced to hold on to these companies when it was pretty clear the future was very bleak. For every active manager who sold those companies on the way down, there was a...