Search found 1285 matches

by bigred77
Sun Feb 12, 2017 5:49 pm
Forum: Investing - Theory, News & General
Topic: What is the prediction of future long-term returns for your portfolio?
Replies: 63
Views: 4618

Re: What is the prediction of future long-term returns for your portfolio?

BTW.. The previous 17 years have been pretty grim for US equities (S&P 500 returned about 2.5% real). Can't we all advocate for some positive reversion to the mean? Isn't it about time for a 17 year period of 9%+ real returns? Heck I may be able to retire before age 50 if that happens. I see th...
by bigred77
Fri Feb 10, 2017 3:37 pm
Forum: Investing - Theory, News & General
Topic: What happens to company 's profit?
Replies: 11
Views: 1113

Re: What happens to company 's profit?

For publicly traded companies: Net income (minus dividends and stock buybacks) from the income statement will flow directly into retained earnings on a company's balance sheet. Stock holders have company's profits directly returned to them only through management's discretion (dividends). Other alte...
by bigred77
Fri Feb 10, 2017 3:14 pm
Forum: Investing - Theory, News & General
Topic: What is the prediction of future long-term returns for your portfolio?
Replies: 63
Views: 4618

Re: What is the prediction of future long-term returns for your portfolio?

For planning purposes, I use 5% real for a 75/25 portfolio (with a little tilting towards small, value, and EM) over the next 3 decades. If I get that, I can retire early and wealthy. If I get more, I can retire earlier and wealthier. If I get less I can retire either early or wealthy, probably not ...
by bigred77
Fri Feb 10, 2017 1:44 pm
Forum: Investing - Help with Personal Investments
Topic: 31yo married, resident physician, soon to be practicing - need help rebalancing
Replies: 10
Views: 1166

Re: 31yo married, resident physician, soon to be practicing - need help rebalancing

I think the target date funds are great. I do not hesitate to recommend them in place of a 3 or 4 fund portfolio at all unless one has significant taxable holdings or limited 401k/403b/457 options that make a 3 or 4 fund portfolio more efficient. In your case I would recommend starting with target d...
by bigred77
Fri Feb 10, 2017 10:22 am
Forum: Investing - Help with Personal Investments
Topic: 31yo married, resident physician, soon to be practicing - need help rebalancing
Replies: 10
Views: 1166

Re: 31yo married, resident physician, soon to be practicing - need help rebalancing

I would keep it as simple as possible. - Use target date funds for now. - Max out all of your tax advantaged space (401ks, 403bs, backddor Roth IRAs). At your income level and tax bracket it will be invaluable. - I would sell your taxable investments, your "business investment", and take a...
by bigred77
Fri Feb 10, 2017 10:11 am
Forum: Investing - Theory, News & General
Topic: College savings if ineligible for financial aid?
Replies: 4
Views: 352

Re: College savings if ineligible for financial aid?

I would continue maxing out 529s to the extent you get the state tax deduction but then I would continue saving in a taxable account if able. I would also try to cash flow as much as I could during the early years, leaving your 529s more time to grow tax free for the younger children.
by bigred77
Fri Feb 10, 2017 10:06 am
Forum: Investing - Theory, News & General
Topic: How a Banker or Insurance Company Thinks of an Insurance Annuity - SPIA
Replies: 6
Views: 559

Re: How a Banker or Insurance Company Thinks of an Insurance Annuity - SPIA

I thought this was very informative and well written. It reinforces to me that SPIA are likely the only annuities I would ever consider. They are the simplest, most "commodity like" product that can be shopped and compared around on an apples to apples basis. Interesting that the actual re...
by bigred77
Thu Feb 09, 2017 6:08 pm
Forum: Investing - Help with Personal Investments
Topic: Year 2 Portfolio Check Up & Decisions
Replies: 4
Views: 495

Re: Year 2 Portfolio Check Up & Decisions

My advice would be once married, treat the portfolio as one over all accounts (his and her 401ks, Roth IRAs, taxable accounts, etc.) Decide on one AA and implement it over all of the accounts as efficiently as possible. My wife is also a teacher. We basically ignore her pension value since I view it...
by bigred77
Thu Feb 09, 2017 5:55 pm
Forum: Personal Consumer Issues
Topic: Advice w/ 62YO Mom Moving In - Rent? Resentment? Plans? (Update, Pg 3)
Replies: 123
Views: 13642

Re: Advice w/ 62YO Mom Moving In - Rent? Resentment? Plans? (Update, Pg 2)

I debated on whether to post an update because I hate to keep bumping a thread of mine, but something in me keeps telling me to update this. My hope is that someone in my shoes (or someone who will be in my shoes) will find value in this and can avoid some of the issues I've faced. Things have chan...
by bigred77
Thu Feb 09, 2017 1:07 pm
Forum: Investing - Help with Personal Investments
Topic: Investing for daughter question?
Replies: 16
Views: 1193

Re: Investing for daughter question?

I would just add that I would be maxing out all tax advantaged space available first, before I set anything aside specifically for my child. You can always give her money when she needs it later via withdrawals or cash flow.
by bigred77
Thu Feb 09, 2017 1:03 pm
Forum: Investing - Theory, News & General
Topic: Why go with an 80% stock / 20% bond portfolio?
Replies: 328
Views: 17679

Re: Why go with an 80% stock / 20% bond portfolio?

The differences in those portfolios are all very small. But do you see how those portfolios have essentially the same gain for 100/0, 90/10, and 80/20? Perhaps the answer to the question in your OP is: Because the person is not engaged in factor investing. That doesn't really address my assertion i...
by bigred77
Thu Feb 09, 2017 12:15 pm
Forum: Investing - Theory, News & General
Topic: The Iron Law of Valuation
Replies: 24
Views: 2473

Re: The Iron Law of Valuation

[i] With respect to conventional investment strategies, understand that holding a fixed, static allocation to stocks and other investment classes, regardless of their valuations, is implicitly an *active* investment strategy . At rich valuations, it is a strategy that lengthens the effective maturi...
by bigred77
Thu Feb 09, 2017 10:43 am
Forum: Personal Finance (Not Investing)
Topic: Different Advice Needed - Career Change to Investment
Replies: 12
Views: 1109

Re: Different Advice Needed - Career Change to Investment

Thank you all for the honest opinions. Just out of curiosity, are there any people who work in financial services industry, specifically to invesment? I am still trying to keep my mind open and need some help exploring more options in the industry. Since I am an engineer, my network is very limited...
by bigred77
Thu Feb 09, 2017 9:06 am
Forum: Personal Finance (Not Investing)
Topic: Can I afford a house addition/HELOC?
Replies: 29
Views: 1532

Re: Can I afford a house addition/HELOC?

I would not reduce retirement contributions at all. It's important to to stuff funds into those tax advantaged accounts, especially for high income earners, and that space is "use it or lose it". If the house needs to be revamped to work for your family then so be it. You have 130k in cash...
by bigred77
Wed Feb 08, 2017 7:33 pm
Forum: Investing - Help with Personal Investments
Topic: Windfall, but need to withdraw
Replies: 9
Views: 1023

Re: Windfall, but need to withdraw

I wouldn't think of Roth IRA contributions as a "withdrawal" as much as it is a move between investment vehicles. 1.) If you pay off the mortgage, ignore the Roth IRA funding, and cut expenses a little bit can you live on just income? If so I would do just that (and move the max Roth IRA a...
by bigred77
Wed Feb 08, 2017 6:49 pm
Forum: Investing - Help with Personal Investments
Topic: 3-Fund Portfolio with Option Volume
Replies: 6
Views: 658

Re: 3-Fund Portfolio with Option Volume

I suspect this would be relatively easy to implement. Probably a 15 min call to Interactive Brokers and you could have a plan ready to go.

I think it's a bad strategy and a bad idea to do this. But that doesn't mean it can't be implemented fairly easily.
by bigred77
Fri Feb 03, 2017 4:28 pm
Forum: Investing - Help with Personal Investments
Topic: Game won with market up and retire or Not Yet?
Replies: 33
Views: 4864

Re: Game won with market up and retire or Not Yet?

The market will crash but we don't know when, and it will then recover, but we don't know when. What we have seen is, if you annually spend a fixed percentage of the recent remaining portfolio value, you do not risk being impoverished. You risk a somewhat lower standard of living until recovery, to...
by bigred77
Thu Feb 02, 2017 5:49 pm
Forum: Personal Finance (Not Investing)
Topic: How much will i need to retire in my apartment in nyc?
Replies: 35
Views: 3817

Re: How much will i need to retire in my apartment in nyc?

Relax, if your expenses would be 4k a month (in 2017 dollars) if your mortgage was paid off then congrats, you've already made it. A typical 2 income couple in NYC will receive more than that in SS payments alone once they reach retirement age. Anything in your portfolio will be for luxuries. This....
by bigred77
Thu Feb 02, 2017 5:35 pm
Forum: Personal Finance (Not Investing)
Topic: Thoughts on Living Off Interest/Dividends
Replies: 54
Views: 5428

Re: Thoughts on Living Off Interest/Dividends

"I wouldn't recommend a retail investor pick individual stocks period" But that is just what I did. I was tired of paying advisors who in the end just bought MCD, JNJ, MSFT, T, etc etc. I don't think its so difficult that a reasonably intelligent person cant pick 25 or so "dividend a...
by bigred77
Thu Feb 02, 2017 2:17 pm
Forum: Personal Finance (Not Investing)
Topic: Contesting a will or trust
Replies: 31
Views: 1489

Re: Contesting a will or trust

What does the will or trust document say?

If the will or trust document say to distribute 600k to one party and 2k each to the other parties, then there is no case.
by bigred77
Thu Feb 02, 2017 2:14 pm
Forum: Personal Finance (Not Investing)
Topic: Thoughts on Living Off Interest/Dividends
Replies: 54
Views: 5428

Re: Thoughts on Living Off Interest/Dividends

My view is that living off the dividends is the better course. I know many on this site say selling shares produces the same result but I don't like doing it that way. I have a portfolio of blue chip stocks that produce dividends of roughly about 3.5% and the dividend payout grows by 3-5% every yea...
by bigred77
Thu Feb 02, 2017 12:09 pm
Forum: Personal Finance (Not Investing)
Topic: Thoughts on Living Off Interest/Dividends
Replies: 54
Views: 5428

Re: Thoughts on Living Off Interest/Dividends

Say someone is newly retired, age 65. They have expenses of $100,000 a year (including taxes). Social Security will bring in $40,000 a year leaving $60,000 then need to produce from their investment portfolio. Assume you have a portfolio of $2.5 million. My thinking is they could have retired a dec...
by bigred77
Thu Feb 02, 2017 11:55 am
Forum: Investing - Help with Personal Investments
Topic: Protecting a sizable amount of capital for 10 years.
Replies: 16
Views: 1968

Re: Protecting a sizable amount of capital for 10 years.

"Protect capital in the safest possible way" would indicate to me an investment in which the principal is guaranteed safe in the absence of complete societal collapse, such as FDIC-insured CDs, savings accounts, money market accounts or bonds issued and backed by the Federal government. I...
by bigred77
Thu Feb 02, 2017 10:37 am
Forum: Personal Finance (Not Investing)
Topic: How much will i need to retire in my apartment in nyc?
Replies: 35
Views: 3817

Re: How much will i need to retire in my apartment in nyc?

If 1,600 is the monthly maint, you will need another few hundred for electric, cable, year end staff tipping, periodic fixing of HVAC system or replacing old ACs. Maint also doesn't cover your handyman stuff like fixing a leak or plumbing issues. Should be conservative and assume $2000 a month. Don...
by bigred77
Thu Feb 02, 2017 10:26 am
Forum: Personal Finance (Not Investing)
Topic: Purchasing 4 Family House for Rental Income
Replies: 34
Views: 2263

Re: Purchasing 4 Family House for Rental Income

How the heck can I put 3% down on a rental property? Who would make that loan? Are you sure one of these guys isn't referencing the terms he was told on a VA or FHA loan for a personal residence? Because yes, there are loans available with low down payments for personal residences. I've never heard ...
by bigred77
Thu Feb 02, 2017 9:48 am
Forum: Personal Finance (Not Investing)
Topic: Earning $36/hr for by driving for errands. Worth it?
Replies: 20
Views: 3641

Re: Earning $36/hr for by driving for errands. Worth it?

What are your alternative employment options? Is this better than working for minimum wage in a retail store? Yes. Is it better than making $36/hr in an office environment where you aren't driving around in your own car? No. Anything in between there is probably up for debate based on your assumptio...
by bigred77
Thu Feb 02, 2017 9:37 am
Forum: Personal Finance (Not Investing)
Topic: Can We Afford A $550k House - Your Opinion?
Replies: 29
Views: 3714

Re: Can We Afford A $550k House - Your Opinion?

OP can clearly afford it. Wants the extra space. And would be making a prudent decision to trade up into the house their family would prefer. What the heck is the point of making money if you can't enjoy it? They want all of their kids to have their own bedroom and would prefer 1 shower for every 2 ...
by bigred77
Wed Feb 01, 2017 3:59 pm
Forum: Investing - Theory, News & General
Topic: Retiree Accumulation/Withdrawal Phase -- How many funds do you have? Allocation? Withdrawal strategy?
Replies: 90
Views: 6300

Re: Accumulation or Withdrawal Phase -- How many funds do you have? Allocation?

Accumulation Phase 3 primary Investment vehicles: Roth IRA 1: 1 fund Roth IRA 2: 2 funds 401k (w/ brokeragelink option via fidelity): 10 funds AA: 30% US TSM 20% Total International 5% Each: US REITs, International REITS, US SCV, International SC, EM 10% Total Bond Market 10% TIPS 5% Investment Grad...
by bigred77
Wed Feb 01, 2017 3:03 pm
Forum: Personal Finance (Not Investing)
Topic: At what point (if ever) it is OK to pause retirement contribution to buy a house?
Replies: 29
Views: 2042

Re: At what point (if ever) it is OK to pause retirement contribution to buy a house?

OP, You are someone that IMO should actually consider a low down payment mortgage even if it means paying PMI (like a FHA loan). Being 38 with only 25k in retirement accounts (thats OK, you had a late start, you still have sufficient time) would make retirement saving a priority. I would not pause y...
by bigred77
Wed Feb 01, 2017 2:42 pm
Forum: Investing - Theory, News & General
Topic: Exxon's PE ratio is 40????
Replies: 27
Views: 2618

Re: Exxon's PE ratio is 40????

Full disclosure, I'm a professional energy investor but I really don't follow XOM very closely. We focus on very play specific investments. Really interested to hear your opinion on the most attractive plays in the current environment (if you are free to give it)? Do you guys focus only on US plays...
by bigred77
Tue Jan 31, 2017 5:34 pm
Forum: Personal Finance (Not Investing)
Topic: Another can I afford this $2M house thread...
Replies: 70
Views: 6961

Re: Another can I afford this $2M house thread...

His income: $350k (bonus up to additional $50k) Her Income: $180k His 401k: $225k Her 401k: $110k His Roth: $130k Her Roth: $130k 529: $180k Taxable account: $900k Relative to your combined income you you really don't have a lot in savings. Unless you there is something else going on then you are a...
by bigred77
Tue Jan 31, 2017 4:56 pm
Forum: Personal Finance (Not Investing)
Topic: Should I pay off my house?
Replies: 23
Views: 2589

Re: Should I pay off my house?

Simplify your life and pay it off. Besides, I can't think of any other options with a risk-free 4.375% return (savings). +1 Then see if you are a good candidate for a backdoor Roth IRA. Do you have any traditional IRA balances (401k balances don't count)? If so can you roll these balances into your...
by bigred77
Tue Jan 31, 2017 4:52 pm
Forum: Investing - Help with Personal Investments
Topic: TIPS for European Investors
Replies: 5
Views: 407

Re: TIPS for European Investors

I'm a US investor so take my advice with a grain of salt. If those are your only 2 options then I suppose you have to decide if you prefer to take on additional credit risk or interest rate risk. I don't think either of those 2 funds would be a "bad" decision. If i was in your position, an...
by bigred77
Tue Jan 31, 2017 1:51 pm
Forum: Investing - Help with Personal Investments
Topic: going to cash w present instability
Replies: 24
Views: 3232

Re: going to cash w present instability

Which Target Retirement Fund? Is it the Target Retirement Income Fund (VTINX)? I would suggest it's a bad idea. There is always instability in the market. Drastic changes like this are never a good idea. Do you need these assets to live on? If that's the case have you considered liquidating a portio...
by bigred77
Tue Jan 31, 2017 1:38 pm
Forum: Investing - Help with Personal Investments
Topic: Help with my short term plan
Replies: 5
Views: 811

Re: Help with my short term plan

I just wanted to bump this so hopefully you can get some additional replies. 1.) I would first decide on an overall Asset Allocation that you are comfortable with. Then I would implement that portfolio, using all of your available accounts, as tax efficiently as possible. For instance REITs are real...
by bigred77
Tue Jan 31, 2017 1:13 pm
Forum: Investing - Theory, News & General
Topic: possible to reduce my holding of international with my setup
Replies: 5
Views: 491

Re: possible to reduce my holding of international with my setup

You need to be evaluating your decisions over longer time frames. I realize international is slowly going up, since it has been so low, and I also know the Total Market is at all time highs! So, I may receive comments to leave everything alone, and i'm stuck with my international.... You have descri...
by bigred77
Tue Jan 31, 2017 12:53 pm
Forum: Personal Finance (Not Investing)
Topic: Another can I afford this $2M house thread...
Replies: 70
Views: 6961

Re: Another can I afford this $2M house thread...

So we were considering a hybrid of 20% down, 300k loan at 3%, remainder in 30 year mortgage. I welcome alternative thoughts on how to finance this purchase. We would consider putting more down but selling our taxable account will come with significant additional taxes. We currently max 401k x2, bac...
by bigred77
Tue Jan 31, 2017 12:34 pm
Forum: Personal Consumer Issues
Topic: Single Malt Scotch-time for another thread?
Replies: 69
Views: 5623

Re: Single Malt Scotch-time for another thread?

I know everyone like Macallen but it I find it too "sweet" and have never much cared for it (I am in a small minority, I realize). You're not the only one. Macallan doesn't really do it for me, especially at the price point. Are you a Cornell grad? I graduated from the Ag school in the la...
by bigred77
Tue Jan 31, 2017 9:21 am
Forum: Personal Consumer Issues
Topic: Single Malt Scotch-time for another thread?
Replies: 69
Views: 5623

Re: Single Malt Scotch-time for another thread?

I enjoy a bit of the creature from time to time, scotch, bourbon, etc. I've never been able to bring myself to spend over $100 for a bottle. I always ask myself, self, how much better can a $100 bottle be than a $75 bottle? My most expensive bottle was Lagavulin 16, think paid around $70 for it. I ...
by bigred77
Mon Jan 30, 2017 5:49 pm
Forum: Personal Consumer Issues
Topic: Is joining a country club a character flaw?
Replies: 101
Views: 7981

Re: Is joining a country club a character flaw?

I too have considered joining a number of country clubs (or social clubs) in my area. Unfortunately I simply can't afford it at this time (at least the ones that I would want to join). In my area, clubs start with an initiation fee of 20k (these are the ones without a golf course) and ongoing dues o...
by bigred77
Mon Jan 30, 2017 4:11 pm
Forum: Personal Finance (Not Investing)
Topic: Strategy for Purchasing a House
Replies: 21
Views: 2360

Re: Strategy for Purchasing a House

I would go with the 30 yr mortgage since you are just about to start a family soon and your expenses will be increasing. You are also a dual income household now but how sure are you of that continuing in the future? You don't have to make a decision now but you could always split any bonus/windfall...
by bigred77
Mon Jan 30, 2017 3:55 pm
Forum: Investing - Help with Personal Investments
Topic: Projections for bonds if stocks tank
Replies: 26
Views: 2303

Re: Projections for bonds if stocks tank

I'm retiring in May and planning to withdraw 4% from my portfolio, with a catch. My plan is to withdraw 4% from the portfolio (50%/50%) even if it drops, even significantly. Enough of my expenses are "optional" that I think I can swing this. So on my planning sheet I have an "assumpt...
by bigred77
Thu Jan 26, 2017 4:00 pm
Forum: Personal Finance (Not Investing)
Topic: Bogleheads Guide to Investing....for a Boglehead?
Replies: 13
Views: 807

Re: Bogleheads Guide to Investing....for a Boglehead?

It's hard to know, so why not just get it from the library? I'll put in a plug to read books and not get all one's information off the internet. At least with a book, someone took the time to write it, edit it, and publish it. It means there was an editor spending real time on it and a publisher pa...
by bigred77
Thu Jan 26, 2017 3:45 pm
Forum: Personal Finance (Not Investing)
Topic: Should my spouse sell her long term-held company stock to pay mortgage down so we can refinance at a lower rate?
Replies: 20
Views: 1938

Re: Should my spouse sell her long term-held company stock to pay mortgage down so we can refinance at a lower rate?

Normally I would say absolutely, that's too much concentrated risk. Sell, pay down the debt, backdoor Roth IRAs, taxable account per AA. However, she is an officer in a publicly traded company. Typically, she will have to report her transactions to the SEC and they will be publicly disclosed. There ...
by bigred77
Thu Jan 26, 2017 3:25 pm
Forum: Investing - Help with Personal Investments
Topic: Vanguard Life Strategy 80%
Replies: 16
Views: 2856

Re: Vanguard Life Strategy 80%

I think for that particular fund, 5% real over the next 3 decades is a reasonable estimate.
by bigred77
Thu Jan 26, 2017 3:22 pm
Forum: Investing - Help with Personal Investments
Topic: Wellesley and Wellington long term details Vs Indexes
Replies: 13
Views: 1915

Re: Wellesley and Wellington long term details Vs Indexes

I posted earlier about the Fed raising the fed rate to 3% over the next year or two. I get it that that may or may not have much effect on longer term bond prices and lots of other things. But I also think old retired investors like me are going to get hammered if we do not handle our bond allocati...
by bigred77
Thu Jan 26, 2017 2:26 pm
Forum: Investing - Theory, News & General
Topic: what to do if you don't want bonds
Replies: 23
Views: 2375

Re: what to do if you don't want bonds

If I were in your position I would just buy bonds :D . Keep it simple and consistent.

If we throw out typical bond funds and ETFs then you still have I Bonds, EE Bonds, CDs, stable value funds and savings accounts.
by bigred77
Thu Jan 26, 2017 2:22 pm
Forum: Personal Finance (Not Investing)
Topic: Cashing out for 2017 expenses while market is high?
Replies: 33
Views: 3192

Re: Cashing out for 2017 expenses while market is high?

What % is 1 year of expenses to your portfolio? This is the question. If it's around 4% or something similar than cashing out early and missing a run up/decline of 10% is only going to affect your portfolio by 40 basis points. Nothing earth shattering. If it makes you feel good to convert your plan...
by bigred77
Thu Jan 26, 2017 10:46 am
Forum: Investing - Theory, News & General
Topic: BRK - thoughts on interesting stock
Replies: 66
Views: 6168

Re: BRK - thoughts on interesting stock

Because BRK is still a single company. Granted, it's a conglomerate that is exposed across many different industries but it's still a single company at the end of the day. Why is that important? Because I'm not diversified. I'm taking on non-systemic risk in which I do not expect to be compensated f...
by bigred77
Thu Jan 26, 2017 10:37 am
Forum: Investing - Help with Personal Investments
Topic: Is it to time to switch from Target Date fund to 3 fund portfolio?
Replies: 13
Views: 1399

Re: Is it to time to switch from Target Date fund to 3 fund portfolio?

The target date funds are perfectly fine. They are appropriate even if your portfolio is multiple millions. There is no reason to change just for the sake of change. It would make sense to change if one of the following applied to you: - You are maxing out all of your tax deffered space and are now ...

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