Bogleheads.org

dbr

Thank you for the response, and you're correct in that I have multiple investment vehicles (401K, Roth IRA, and a taxable brokerage account). After reading what you said about the international allocation within the TR funds, I have to agree that I have no interest in having international bonds in ...

dbr

I started retirement with $400k in cash and am glad I did. We’re using these funds for aggressive Roth conversions over the next few years (living expense and taxes). In hindsight I wish I’d set aside even more in taxable for this purpose. This is an example of a special case use of money where one...

dbr

Typically you would withdraw so that you maintain the same AA before and after. The target fund helps you do this without any rebalancing required. If you withdraw only bonds then your AA will drift more stock heavy, thus defeating the point of the target funds. Are you trying to move toward an AA ...

dbr

Really having family money means one is in a different world from anything having to do with Boglehead investing. It is possible that MacKenzie Bezos has "family" money and so does/will Mrs. Warren Buffett. Other people with family money are, or used to be, named things like Astor or Rocke...

dbr

1. You are wasting time and worry trying to find "better" bond funds. Bond funds fluctuate in value. But it doesn't matter. The properties to attend to are the possible return and uncertainty of return of your whole portfolio. That is more of each with more stocks and less of each with mor...

dbr

Associated Core Bond Fund (no code) 0.01% ER? It is highly likely this is a suitable fund. The word "core" tends to be a giveaway to being "total bond" like. Surely there is a description of the holdings of the fund or a statement of fund objective or even an index that you can ...

dbr

I think to be family money it is more than just inherited or expected to be passed down but also that the accounts are owned in trusts or entities that are joint to a number of individuals. This implies that no single person can just do something with all the money. There is an implication that this...

dbr

I never had a cash position before, at, or through retirement. Now retired 14 years. But there can also be confusion about emergency fund, whatever. It is inevitable that cash exists in various accounts because cash management is not that precise. It isn't worth the effort to make it precise. There ...

dbr

Bonds aren't really supposed to generate income. Only in declining rate scenario would bonds have positive real return. When yields are higher, inflation is higher. AGG and BND are investment grade and excellent choices but more for wealth preservation and reducing volatility than to generate incom...

dbr

Reason I'm asking is that I'm a relatively young retiree. I try and follow Bill Bernstein's advice to have 25X expenses in "safe" instruments, but if "safe" means short term T-bills and the like, then that 25X in T-bills doesn't generate enough income to live on. AGG has a signi...

dbr

I just retired and have company 401k with Fidelity in target date fund. Want to rollover to IRA following Boglehead three fund portfolio. I thought it would be easier to stay with Fidelity, so I identified Fidelity Total Market Index Fund, Fidelity Total International Index Fund, Fidelity U.S. Bond...

dbr

Two suggestions: 1. Call your plan administrator and ask why you don't see separate accountings. It is possible you haven't drilled down into your online account far enough or it may be something they sent you is just a short summary letter. My 401k has some odd classes of contributions such as pre ...

dbr

How much of these investments, if any, are simply about more risk? Would one do just as well funneling as much cash into VTWAX as possible with cheap leverage? Or do these kinds of investments tend to do better for investors because they're closer to the investment, higher priority on any payouts, ...

dbr

ok so cost basis looks accurate, based on the document EJ gave me. How is it handled if a stock is lower now than on cost basis date? If the cost basis is accurate for your interest in the assets, then you can sell at a loss and the loss can be used in a complicated way to offset income on your tax...

dbr

if LTTs (VGLT for example) are more negatively correlated to Stocks than BND, but with a potential to have lower draw downs and higher return, why not choose VGLT all the time over BND? Well, that is exactly an argument people do make, or a preference that people choose. The other side of that is t...

dbr

1. I used the Morningstar X-ray to see assess my small and mid cap tilt. What do you think is the most effective small and mid cap tilt. Value vs Core vs Growth. That depends on what you mean by effective. Theory says that the higher the allocation to small and value the higher the expected return....

dbr

As a generalization the best diversifier for a stock holding is long term Treasuries. This is well known. Note that when you do that the risk and return will be a higher selection than, for example, a high bond portfolio, but you get a good trade off of return for risk. The portfolio theory to suppo...

dbr

Total bond funds are "relatively safe." You have also learned that CDs are not safe because the interest paid can't be counted on. From the definition that investment risk is measured by the standard deviation of annual returns the risk in CDs is around +/-2% which is how much the return c...

dbr

It certainly depends on your specific tax situation, meaning your income or your proposed income, whether you are filing single or married, what exemptions, deductions, and credits you have, including possible tax losses and so on. Even sort of obvious advice not to take distributions from tax defer...

dbr

The missing information is how much they want to spend. A general model for planning for this sort of thing, one of several of the same nature, is www.firecalc.com I suggest working your way through that sort of model to get a feel for what their situation is. The model accepts their assets, planned...

dbr

If you look in a model such as www.firecalc.com one of the input pages is called "other income/spending." If you use the entries creatively there are five possible entries you can make where either an income stream starts or extra spending starts. Those entries are there for one thing to a...

dbr

So I was trying to make sense of this page with regards to ETFs: https://www.tiaa.org/public/brokerage-account-fees It says (1) Equity and Transaction Fee ETF trades - $0, and (2) NTF eligible ETFs will have a $0.00 commission, regardless of order size or holding period. Does (1) mean that if the E...

dbr

According to this neither Vanguard nor Fidelity mutual funds are NTF at TIAA Brokerage (follow the *): https://www.tiaa.org/public/pdf/MF_families.pdf I couldn't find their list of NTF ETFs (non-transaction fee exchange traded funds) but if there is a commission it would be less than for mutual fund...

dbr

Yes there will be a difference. Interest rates at various maturites do not go up by a fixed % or a fixed ratio at each maturity term. Sometimes the shorter stuff goes up a lot more than longer or just the reverserve. Could another way to think about this be that if the yield curve maintained a cons...

dbr

Either fund is reasonable as a core bond fund in an appropriate account, but the increased risk means that there isn't a clear benefit, so I don't normally recommend them as core holdings. A portfolio with the same risk level as a three-fund portfolio, but using higher-risk bonds, needs more bonds....

dbr

https://www.kitces.com/blog/managing-sequence-of-return-risk-with-bucket-strategies-vs-a-total-return-rebalancing-approach/ If there’s one fundamental takeaway that’s been drawn from the research on safe withdrawal rates, it’s the fact that market volatility really matters during the retiree withdr...

dbr

A dodge to get around this is to sell TR fund in a tax deferred account and hold cash there. As you sell TR funds in taxable for income you can replace that TR holding in your tax deferred account by using the cash to buy back fund shares. There are no tax costs to do this in a tax deferred account.

dbr

My investable assets are in target date funds in both my retirement and taxable accounts with 45/55 allocation stocks/bonds in each. Does this method of investing conflict with using a bucket strategy as my stocks and bonds are commingled in a single target date fund obligating me to sell stocks ea...

dbr

Turbotax creates a capital loss carryover worksheet. Your 2019 tax output (not the tax filing documents but the file of all the TT documents and worksheets) has that file and it is, of course, saved in the tax file (file type .tax2019). If when you open TT for 2020 you have it load the previous year...

dbr

Possibly "opportunity cost" I think that would be it. And I agree it isn't a risk in the normal sense of the word in finance and investing, I don't think. In any case there is no way to calculate the value when applied to a sector such as residential housing and an area, such as Los Angel...

dbr

Yes, the key is the yield curve which does not maintain constant shape. That establishes that there is a difference. To determine what will be the difference requires forecasting the yield curve, which is not a practical possibility. You then have to convolute* the changing yield with the modified d...

dbr

I am not sure if there is as technical term. The nature of the risk is that of being out of the market and not owning the asset when the price went up. Naturally risk goes both ways. Prices could have gone down while you were out of the market. As above it is also inflation in a sort of general sens...

dbr

Has anyone heard of HNDL? It's an EDF of EDFs and pays a distribution (not dividend) every month. Right now its paying 7% while the investment has gone unchanged. Here's an article that explains it. https://www.investopedia.com/investing/etf-designed-retirees/?utm_campaign=quote-yahoo&utm_sourc...

dbr

Picking funds isn't a strategy. The strategy that is associated with this is factor investing, specifically tilting to size and value factors as suggested by the Fama-French model of investment returns. You should read on that model. If you are seriously interested in trying to gain something this w...

dbr

Thanks. First off, the goal is to never touch the principal, only the interest. I don't want it to be turned on/off, I want it to be always on as a source of predictable income that is always there as a baseline for living. And when years are better, just have extra, as opposed to what you are sayi...

dbr

In any case dividend income is not constant both quarter to quarter and certainly not over extended times. Also yield is not the income. Yield for a period is the income for that period divided by the current price. A standardized report of yield is the SEC yield which is calculated by certain rules...

dbr

well that is why I proposed a 3% withdrawal rate. I'm acknowledging that if I stay at 3% I am probably very likely to be fine. That will certainly not make me rich! :) That's ok, I am learning what my options are and how much I can expect to remove each year. Thanks again! It will make you rich. Th...

dbr

My objective is to create a consistent passive source of income, that is constant regardless of outside forces. In simple, my starting income will be from Vanguard, and anything outside will be the extra, vs the opposite of what you mentioned. Keep in mind that if your source of income is at your w...

dbr

You don't need to tether yourself to investment yield to be able to save during fat times and consume during lean times. Buy an appropriate asset allocation of given risk and return and add to it when your have excess income and draw from it when you have need. I'm not sure what the analysis is for ...

dbr

Do people who are retired keep that same 10-15 years spending in fixed income the whole way. For example would you do that if you started that way at age 60 but now you are 80, of if you are 90? How does that work? I'm curious because I don't think that way and instead just stick to an allocation ta...

dbr

The general thinking is that income streams are income streams and not investments and are not contemplated as if they were bonds. However the presence of income streams affects your need, ability, and willingness to take risk in your stock and bond portfolio, that is your asset allocation. What the...

dbr

Interesting. What If I exchange all of my target date fund for equal split of shares of VTSAX, VTIAX? Or is that more hustle for little extra profit? It doesn't make enough difference to bother one way or the other. But remember TR funds are not just stocks. Your fund is 10% bonds and will eventual...

dbr

Thank you, yes, I am looking at this "short term" so to speak Retirement is not a short term proposition. By and large your asset allocation would not change from years before retirement through years after retirement, possibly excepting a set aside for some special consideration. Current...

dbr

Besides the small tax implications, is there anything wrong with the above recommendation? Would anyone else want to chime in? It would be what I would do. If you want to find a mistake in this somewhere it would be in taking over someone else's investments, which has the potential of eventually ho...

dbr

Dandy wrote: ↑Sat Apr 10, 2021 11:30 am A decent equity allocation, a decent allocation to inflation protected bonds, and delaying collecting SS as long as you can.

As practical advice that is pretty good.

dbr

5) I think virtually everyone would agree that Total Stock, Total International, Total World, S&P 500 index funds, and many others are "diversified." And that a fund or ETF that invests only in technology stocks is not. Where long arguments come in involve the question of whether Tota...

dbr

My concerns: if dad dies before filing of 2020 (or other years going forward) taxes, I will be unable to use his accounts to pay the IRS. Getting the 50% share for the IRS payments from my sister will be difficult. A tax payment made to his IRS account now is effectively a savings account against a...

dbr

tadamsmar wrote: ↑Sat Apr 10, 2021 11:07 am Did you take that RMD without doing federal tax withholding?

Where is the worrisome tax bill coming from?

Of course. Withholding the expected tax would have been obvious

dbr

Just note that tax strategies involving setting up LLC's, businesses of different kind and advice on real estate investment are a whole different thing from the rest of your list. Just expecting to pay someone to take over your lifetime financial affairs is unrealistic. Finding advice on ordinary st...

dbr

My concerns: if dad dies before filing of 2020 (or other years going forward) taxes, I will be unable to use his accounts to pay the IRS. Getting the 50% share for the IRS payments from my sister will be difficult. A tax payment made to his IRS account now is effectively a savings account against a...

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