Search found 22128 matches

by grabiner
Wed Sep 12, 2018 9:24 pm
Forum: Investing - Theory, News & General
Topic: Short Term Market Uncertainty - "Buy" Insurance?
Replies: 33
Views: 2000

Re: Short Term Market Uncertainty - "Buy" Insurance?

Watching the news recently has caused me to be concerned that the probability of a stock market correction or bear market is currently higher than normal. Without starting a discussion of the news itself the areas of concern are upcoming elections, trade wars and yield curve inversion. Does it make...
by grabiner
Wed Sep 12, 2018 8:58 pm
Forum: Investing - Theory, News & General
Topic: Short-term Treasury vs. Limited-Term Tax-Exempt
Replies: 10
Views: 1234

Re: Short-term Treasury vs. Limited-Term Tax-Exempt

I've mostly been buying individual Treasuries, CDs and munis with new cash for the last year or so, but I did buy some Vanguard Limited-Term Tax-Exempt Admiral shares, VMLUX, in January 2018. Lately Treasuries have been offering higher taxable-equivalent yield (TEY) than AA/AAA munis for me (margin...
by grabiner
Wed Sep 12, 2018 8:54 pm
Forum: Investing - Theory, News & General
Topic: Investing in taxable account or pay more for rental mortgage
Replies: 13
Views: 848

Re: Investing in taxable account or pay more for rental mortgage

See Paying down loans versus investing on the wiki. At your 29.5% marginal tax rate, you would earn a risk-free 3.53% by paying down the rental mortgage. You can't earn 3.53% risk-free in your taxable account; the current yield on low-risk long-term munis is 2.95% (Vanguard Long-Term Tax-Exempt), an...
by grabiner
Wed Sep 12, 2018 8:43 pm
Forum: Investing - Theory, News & General
Topic: Argument for taking social security before 70. Comments?
Replies: 111
Views: 7307

Re: Argument for taking social security before 70. Comments?

Here's how I estimate the break-even. It's easiest to do one year at a time. Suppose that you have enough money to cover this year's Social Security. You can spend the money this year and delay Social Security to next year, or take Social Security now and buy a TIPS ladder which will cover the futur...
by grabiner
Wed Sep 12, 2018 8:07 pm
Forum: Investing - Help with Personal Investments
Topic: How to Evaluate a Bond Repurchase Offer?
Replies: 5
Views: 402

Re: How to Evaluate a Bond Repurchase Offer?

My rudimentary math skills suggest that, if I were to accept the first offer as to the entirety of my holdings, I'd get around $4,752.68 (being 4 times $1,187.17), which is higher than the bonds' current value. But if I were to hold the bonds to maturity, I'd get $1,450 in interest ($290 times the ...
by grabiner
Wed Sep 12, 2018 7:59 pm
Forum: Investing - Help with Personal Investments
Topic: Asset allocation after paying off mortgage
Replies: 22
Views: 1786

Re: Asset allocation after paying off mortgage

I still have the same asset allocation within a simple 3 fund portfolio after paying off the mortgage. I'm wondering if I should now allocate a bit more to equities and less to bonds. I use age -13 for an allocation to bonds. Maybe age -15 or 20 since the mortgage could be considered a bond like al...
by grabiner
Wed Sep 12, 2018 7:54 pm
Forum: Investing - Help with Personal Investments
Topic: Asset allocation after paying off mortgage
Replies: 22
Views: 1786

Re: Asset allocation after paying off mortgage

Hello all. Thank you in advance to all the fantastic people on this board. Recently I paid off my mortgage. ( I know, that's a whole other discussion). I feel blessed that I could pay it off while in my early 50s and have a good deal remaining for retirement, which could be 5 years away, in some fo...
by grabiner
Wed Sep 12, 2018 7:49 pm
Forum: Investing - Help with Personal Investments
Topic: Roth conversions when we will be in 22% bracket for indefinite future
Replies: 16
Views: 1797

Re: Roth conversions when we will be in 22% bracket for indefinite future

Can you pay the taxes with money that would be in your taxable account otherwise (either money that is already there, or RMDs you don't need to spend)? If so, then a conversion is a net gain even if you stay in the same bracket; you trade $10,000 in a traditional account (worth $7000 tax-free) and $...
by grabiner
Wed Sep 12, 2018 7:44 pm
Forum: Investing - Help with Personal Investments
Topic: sector etfs
Replies: 4
Views: 413

Re: sector etfs

Welcome to the forum! A total market ETF will return exactly the same as the average of all sector ETFs, since it holds all sectors. Therefore, it is significantly less risky. It should have about the same average return; there is no particular reason to expect one sector to outperform the market as...
by grabiner
Wed Sep 12, 2018 7:41 pm
Forum: Investing - Help with Personal Investments
Topic: Can I contribute to HSA this year?
Replies: 9
Views: 795

Re: Can I contribute to HSA this year?

I'm no expert, but maybe evaluating which is a better option for your married situation is the real question: keep her FSA with 2018 contribution limit of $2650? Or drop the FSA and pursue the HSA which has a 2018 contribution limit of $6900. You cannot normally terminate an FSA during the year. Yo...
by grabiner
Wed Sep 12, 2018 7:36 pm
Forum: Investing - Help with Personal Investments
Topic: Switch bond funds later?
Replies: 2
Views: 335

Re: Switch bond funds later?

Yes, you would pay tax on any capital gains if you switch bond funds. However, bond funds don't tend to have much in capital gains, so any tax cost for switching should be very low.
by grabiner
Wed Sep 12, 2018 7:35 pm
Forum: Investing - Help with Personal Investments
Topic: Unwinding long term investments
Replies: 6
Views: 873

Re: Unwinding long term investments

Thanks for the input. I calculated the loss / gain in moving to passive index funds (if the active ones continue to perform at the same level). Can some one validate these numbers? Start: Assume 40% cost basis (i.e., 60% is profit) Scenario A: sell @ 15% LTCG and then reinvest immediately in VTI. A...
by grabiner
Wed Sep 12, 2018 7:19 pm
Forum: Investing - Help with Personal Investments
Topic: FERS why it is so low.
Replies: 12
Views: 1764

Re: FERS why it is so low.

Hi. I just started a federal job. It has FERS. I went through the FERS calculator and it says that when I retire I will get a whopping 5k a year in retirement income. I don't get it. Is this for real? What is so great about government benefits if the pension pays 5k a year when you retire? It seems...
by grabiner
Wed Sep 12, 2018 7:12 pm
Forum: Investing - Help with Personal Investments
Topic: What do I do with my investments during a downturn/recession?
Replies: 24
Views: 2741

Re: What do I do with my investments during a downturn/recession?

2) In addition, should I contribute more to my Traditional IRA account or to my cash savings account with 2% annual yield? (I max out Roth IRA every year). If you max out a Roth IRA, you cannot also contribute to a traditional IRA (unless your Roth IRA contribution limit is in the phase-out range);...
by grabiner
Tue Sep 11, 2018 8:55 pm
Forum: Investing - Help with Personal Investments
Topic: House: Pay Cash then Mortgage (Delayed Financing) - worth it?
Replies: 25
Views: 3524

Re: House: Pay Cash then Mortgage (Delayed Financing) - worth it?

Anybody aware of TCJA affect on this? Thinking of the following: 1. Use HELOC from current primary residence and savings to purchase new secondary residence. 2. Apply for delayed financing after close to pay off HELOC. Is the mortgage on the the 2nd residence deductible? Is it considered home acqui...
by grabiner
Tue Sep 11, 2018 8:49 pm
Forum: Investing - Help with Personal Investments
Topic: TIPS with Fidelity through HSA
Replies: 6
Views: 982

Re: TIPS with Fidelity through HSA

I know this is an old thread but is there an update on recommended TIPS funds to use in a CA HSA held in Fidelity? I have been using FSIYX this year. However, I was wondering if I should switch to a commission-free short term TIPS ETF like STIP since the yields are very similar but the duration is ...
by grabiner
Sat Sep 08, 2018 7:54 pm
Forum: Investing - Theory, News & General
Topic: Stocks in a 401k is a bad idea, right?
Replies: 43
Views: 5523

Re: Stocks in a 401k is a bad idea, right?

Ok.. I didn't understand this 10% cost for the 401k. I thought you were taking about a fee over the total value of the portfolio, comparable to a fund fee Still, I was referring to a comparison to a taxable account. Even with this 10% upfront tax sheltered account should be better over the long ter...
by grabiner
Fri Sep 07, 2018 10:07 pm
Forum: Investing - Help with Personal Investments
Topic: Millions to Invest at 30 - VTSAX, VTIAX, and VWIUX Lump Sum?
Replies: 9
Views: 2977

Re: Millions to Invest at 30 - VTSAX, VTIAX, and VWIUX Lump Sum?

2. Is VTSAX, VTIAX, and VWIUX a solid three-fund portfolio for my current situation? In NJ, I would recommend putting half the bond money in Vanguard NJ Long-Term Tax-Exempt, and half in Limited-Term Tax-Exempt. This would make more than half your muni interest exempt from NJ state tax, while only ...
by grabiner
Fri Sep 07, 2018 9:55 pm
Forum: Investing - Help with Personal Investments
Topic: hold US or Int'l index fund in taxable account?
Replies: 9
Views: 1586

Re: hold US or Int'l index fund in taxable account?

miket29, Vanguard's site can shed some light on the tax differences for you, since they show average annual total return after tax on distributions, and also after taxes on distributions and sale of fund shares. Tax rate assumptions are provided on their site. Here's what the 10-yr returns look lik...
by grabiner
Fri Sep 07, 2018 9:36 pm
Forum: Investing - Help with Personal Investments
Topic: Wash sale rules
Replies: 9
Views: 551

Re: Wash sale rules

No. The same day is within the range of 30 days before to 30 days after. I am unsure. The lots in IRA and taxable were bought at the same price, before the price declined. Therefore, the security on which tax loss is taken in taxable was not bought at the new lower price in IRA. The wash sale rule ...
by grabiner
Fri Sep 07, 2018 6:11 pm
Forum: Personal Finance (Not Investing)
Topic: How Big of a Mortgage Should We Get?
Replies: 41
Views: 3037

Re: How Big of a Mortgage Should We Get?

On a related note, does vanguard offer a way to estimate capital gains before you sell stock? Yes. Under "My Accounts", select "Cost Basis". This will show the unrealized gains, as long as Vanguard has correct information. (For mutual funds purchased in 2011 or earlier, Vanguard only kept track of ...
by grabiner
Thu Sep 06, 2018 10:56 pm
Forum: Personal Finance (Not Investing)
Topic: Credit Score [What changes your credit score?]
Replies: 42
Views: 3379

Re: Credit Score [What changes your credit score?]

If you are really curious, you can use Credit Karma. They will give an approximate score plus what areas would increase your score. According to that site, they only way to improve my credit score would be to get more credit cards, possibly to decrease my debt utilization. Paying down your balances...
by grabiner
Thu Sep 06, 2018 9:47 pm
Forum: Personal Finance (Not Investing)
Topic: How Big of a Mortgage Should We Get?
Replies: 41
Views: 3037

Re: How Big of a Mortgage Should We Get?

If you would have to sell taxable investments, look at this as an additional cost. For example, if you could get a $200K mortgage with no tax cost, but to pay all cash would require paying $20K in capital-gains tax, then you are effectively paying $220K to pay off a $200K mortgage. For a 15-year mor...
by grabiner
Thu Sep 06, 2018 9:38 pm
Forum: Investing - Theory, News & General
Topic: Stocks in a 401k is a bad idea, right?
Replies: 43
Views: 5523

Re: Stocks in a 401k is a bad idea, right?

Right.. you have to compare X= growth_rate - cost. The one with higher X should go to tax sheltered. If you disagree, perhaps you can send a quick example with numbers Here is a variant of my standard example for traditional versus Roth which shows why this is not correct. You have $9000 in a tradi...
by grabiner
Thu Sep 06, 2018 9:03 am
Forum: Personal Finance (Not Investing)
Topic: Credit Score [What changes your credit score?]
Replies: 42
Views: 3379

Re: Credit Score

What is the highest credit score that a can be achieved? It's model dependent. In any case, the raw number doesn't matter; 700 when the top score is 850 may be 40th percentile with one model and 60th percentile with another. Most sources which tell you a score will show the distribution, and often ...
by grabiner
Wed Sep 05, 2018 10:42 pm
Forum: Personal Finance (Not Investing)
Topic: Credit Score [What changes your credit score?]
Replies: 42
Views: 3379

Re: Credit Score

Credit score = debt score. I think its crazy how lenders us a debt score to justify you worthy of paying back money to them... It should be completely opposite of how it works. Well, let's be honest, if you pay off your debt in advance you are not an attractive borrower. It makes sense to me. But t...
by grabiner
Wed Sep 05, 2018 6:21 pm
Forum: Personal Finance (Not Investing)
Topic: Charitable Tax Deductions
Replies: 46
Views: 3446

Re: Charitable Tax Deductions

* Charitable gifts must be postmarked by Dec 31 and checks dated by Dec 31 to count for that year. It wouldn’t hurt to use certified mail in case the deduction timing is ever challenged by the IRS. And if you donate directly from appreciated securities to the charity, you don't get the deduction un...
by grabiner
Wed Sep 05, 2018 6:18 pm
Forum: Personal Consumer Issues
Topic: Selling a car to CarMax
Replies: 74
Views: 5708

Re: Selling a car to CarMax

"No haggling" simply means the consumer is getting the shaft. Not necessarily; the consumer may value time more than money. I bought a new car last year, and would have been better off buying from CarMax. I saved $300 by not using CarMax, but I spend hours calling and Emailing eight different deale...
by grabiner
Wed Sep 05, 2018 6:10 pm
Forum: Personal Finance (Not Investing)
Topic: Mortgage with Credit Union
Replies: 8
Views: 830

Re: Mortgage with Credit Union

Ask them what they offer for 0 points. Shop around if they won’t. Many lenders won't offer exactly zero; they use small point values to allow the rate to be a fixed multiple of 1/8. Such a lender might offer 0.25 points at 4.375%, or 1.00 points at 4.25%, or 1.75 points at 4.125%, or 2.50 points at...
by grabiner
Tue Sep 04, 2018 11:07 pm
Forum: Personal Finance (Not Investing)
Topic: My Understanding of IRS Safe Harbor Rules ...
Replies: 25
Views: 1953

Re: My Understanding of IRS Safe Harbor Rules ...

The penalty is based on your shortfall from the safe harbor....so the penalty is graded, not a cliff. That is contrary to my long held understanding. I certainly could be wrong, it has happened many times before. Do you have a substantial authority reference? IRS Form 2210 (currently the 2017 editi...
by grabiner
Tue Sep 04, 2018 10:14 pm
Forum: Personal Finance (Not Investing)
Topic: Mortgage with Credit Union
Replies: 8
Views: 830

Re: Mortgage with Credit Union

Ask them what they offer for 0 points. Shop around if they won’t. Many lenders won't offer exactly zero; they use small point values to allow the rate to be a fixed multiple of 1/8. Such a lender might offer 0.25 points at 4.375%, or 1.00 points at 4.25%, or 1.75 points at 4.125%, or 2.50 points at...
by grabiner
Tue Sep 04, 2018 9:57 pm
Forum: Personal Finance (Not Investing)
Topic: Insurance score quirks may encourage shopping
Replies: 7
Views: 1189

Re: Insurance score quirks may encourage shopping

Further quirk update: my insurance score from Credit Karma jumped from 905 to 927. The only substantial change is that a JCPenney card which I had opened in 1999 and closed in 2008, and which was my oldest account, dropped off my report. My oldest open account is from 2002, and my remaining accounts...
by grabiner
Tue Sep 04, 2018 9:36 pm
Forum: Personal Finance (Not Investing)
Topic: Working for a municipality
Replies: 26
Views: 2413

Re: Working for a municipality

One thing to be aware of is that there may be a public pension plan that you get instead of social security. If this happens, there are rules that may reduce the amount of social security benefits you might otherwise receive. It's called "government pension offset". The term you probably want is Wi...
by grabiner
Tue Sep 04, 2018 9:31 pm
Forum: Personal Finance (Not Investing)
Topic: Mortgage with Credit Union
Replies: 8
Views: 830

Re: Mortgage with Credit Union

In my opinion, it rarely makes sense to pay points to "buy down" the rate. If you compare the "APR" it might look good, BUT the "APR" is calculated and disclosed assuming you keep the loan for the full term (perhaps 30 years). However, in practice - that rarely happens and most such loans are paid ...
by grabiner
Tue Sep 04, 2018 9:24 pm
Forum: Personal Finance (Not Investing)
Topic: Obtaining records from old prior accts
Replies: 5
Views: 596

Re: Obtaining records from old prior accts

Thank you very much for responding. If you always maximized the annual contribution to the Traditional IRA it can be relatively easy to determine a basis based on the annual maximum contirbution amounts for the years you made deductible contributions. That was my thinking - just tease out the non-d...
by grabiner
Tue Sep 04, 2018 9:22 pm
Forum: Personal Finance (Not Investing)
Topic: My Understanding of IRS Safe Harbor Rules ...
Replies: 25
Views: 1953

Re: My Understanding of IRS Safe Harbor Rules ...

The penalty is based on your shortfall from the safe harbor....so the penalty is graded, not a cliff. That is contrary to my long held understanding. I certainly could be wrong, it has happened many times before. Do you have a substantial authority reference? IRS Form 2210 (currently the 2017 editi...
by grabiner
Tue Sep 04, 2018 8:10 pm
Forum: Personal Finance (Not Investing)
Topic: Charitable Tax Deductions
Replies: 46
Views: 3446

Re: Charitable Tax Deductions

The SALT limit is the same $10,000 for singles and married couples. Therefore, single taxpayers in high-tax states may still benefit from the deductions, as they need only $2000 in non-SALT deductions to itemize, versus $14,000 for married filing jointly.
by grabiner
Tue Sep 04, 2018 8:05 pm
Forum: Personal Finance (Not Investing)
Topic: My Understanding of IRS Safe Harbor Rules ...
Replies: 25
Views: 1953

Re: My Understanding of IRS Safe Harbor Rules ...

I believe it's AGI over $150K that's the determinant, not taxable income. Regardless, you should be alright in your example. This is correct. Also, I wouldn't cut it too close. I might do $22,000 just to be safe. If you fall short, the penalty is a percentage of the shortfall, essentially interest ...
by grabiner
Tue Sep 04, 2018 7:33 pm
Forum: Investing - Theory, News & General
Topic: Quantifying differences between expense ratios
Replies: 6
Views: 429

Re: Quantifying differences between expense ratios

To estimate the cost of a small difference in expense ratio, multiply the difference by the number of years you will pay it; this will be the reduction in your total returns. For example, if you pay 0.1% extra for 30 years, you will lose 3%; a portfolio which would have grown to $100K with the same ...
by grabiner
Tue Sep 04, 2018 7:28 pm
Forum: Investing - Theory, News & General
Topic: An Honest Stock Market Summary
Replies: 3
Views: 842

Re: An Honest Stock Market Summary

Another version, from the Motley Fool:

An Honest Stock Market Update
by grabiner
Tue Sep 04, 2018 7:16 pm
Forum: Investing - Help with Personal Investments
Topic: My TSP plus inherited IRA 3 Years to go
Replies: 7
Views: 880

Re: My TSP plus inherited IRA 3 Years to go

Welcome to the forum! One point you might have missed. You live in NJ, which does not allow a deduction for contributions to the TSP, nor to an IRA unless it was rolled from a 401(k). Therefore, you need to find out how much your father contributed to both accounts; this fraction of your TSP and IRA...
by grabiner
Tue Sep 04, 2018 7:11 pm
Forum: Investing - Help with Personal Investments
Topic: Need help with individual stock advice taxable account
Replies: 19
Views: 1296

Re: Need help with individual stock advice taxable account

Why would you sell Apple? If Apple was more than 5% of the portfolio, I think it would be fine to sell some of it. That would be my recommendation as well. Apple isn't better or worse than any other stock, but if any single stock is more than 5% of your portfolio, then you are taking extra risk wit...
by grabiner
Tue Sep 04, 2018 7:07 pm
Forum: Investing - Help with Personal Investments
Topic: Exchange Target Date 2055 into 2060. Does it matter WHEN?
Replies: 16
Views: 983

Re: Exchange Target Date 2055 into 2060. Does it matter WHEN?

The NAV doesn’t matter. Why are you wanting a 2060 fund if you are already mid 30’s? I am 27yo although I want to retire very early (once my annual expenses =3% of invested $$) I thought Bogleheads like things aggressive? As in, no bonds until one is 40-45yo? The average on the forum is about age-1...
by grabiner
Tue Sep 04, 2018 6:47 pm
Forum: Investing - Help with Personal Investments
Topic: Which do I pick? Roth 401(k) or Traditional 401(k)?
Replies: 26
Views: 1671

Re: Which do I pick? Roth 401(k) or Traditional 401(k)?

I've thought about moving back to Florida at some point, and if that were to happen, my salary would most likely stay the same or drop. That is a significant reason to prefer a traditional account. If you retire in Florida, you will have a much lower marginal tax rate, since Florida does not have a...
by grabiner
Tue Sep 04, 2018 6:44 pm
Forum: Investing - Theory, News & General
Topic: Stocks in a 401k is a bad idea, right?
Replies: 43
Views: 5523

Re: Stocks in a 401k is a bad idea, right?

1. I don't get to choose which 401k plan providers we use. My employer (or spouse's employer) does. The fact that administrative fees are 1% and/or I have high ER funds means that I want to pick something that returns well enough to make up for these expenses. If bond funds return 3% and I'm paying...
by grabiner
Mon Sep 03, 2018 6:59 pm
Forum: Personal Consumer Issues
Topic: Selling a car to CarMax
Replies: 74
Views: 5708

Re: Selling a car to CarMax

I didn't actually sell to CarMax, but I used a CarMax offer for negotiation when I traded in the car to a dealer instead. The CarMax offer was right at the Kelley Blue Book trade-in value, so it looked like a fair offer. This was an 11-year-old car, so it wasn't worth the effort trying a lot of sale...
by grabiner
Mon Sep 03, 2018 6:52 pm
Forum: Investing - Theory, News & General
Topic: Stocks in a 401k is a bad idea, right?
Replies: 43
Views: 5523

Re: Stocks in a 401k is a bad idea, right?

I totally get tax efficient placement of assets in the right accounts. Bonds now yield maybe 3%. I just don't see why someone would deliberately doom themselves to low returns in their retirement accounts by being 100% bonds. I thought the idea of these accounts was to maximize your "paycheck" in r...
by grabiner
Mon Sep 03, 2018 6:46 pm
Forum: Investing - Theory, News & General
Topic: ESPP as emergency fund
Replies: 7
Views: 663

Re: ESPP as emergency fund

If your employer gets into trouble, you could lose your job and your stock portfolio at the same time. Therefore, it doesn't make sense to use employer stock as an emergency fund.
by grabiner
Mon Sep 03, 2018 6:35 pm
Forum: Investing - Help with Personal Investments
Topic: To pay of mortgage or not to? Help
Replies: 19
Views: 1130

Re: To pay of mortgage or not to? Help

Hello, I am seeking advice on if it is a smart move to pay off our mortgage. Current mortgage: 30 year fix 4.25% with 202k left. We’ve only been in the house a year. We recently received 450k cash and are in the process of deciding how to invest this money. Both my wife's and my 401k, HSA, Roth Ira...
by grabiner
Mon Sep 03, 2018 6:29 pm
Forum: Investing - Help with Personal Investments
Topic: Which do I pick? Roth 401(k) or Traditional 401(k)?
Replies: 26
Views: 1671

Re: Which do I pick? Roth 401(k) or Traditional 401(k)?

Age: 31 Expect to retire: 65 Current tax bracket: 25% Future tax bracket: No idea Residence: California There is no 25% tax bracket this year; you are probably in either the 22% or 24% bracket. However, your overall marginal tax rate probably won't change much, because you probably deducted your st...