Search found 6336 matches

by Johm221122
Sat Jan 27, 2024 6:58 pm
Forum: Investing - Theory, News & General
Topic: International (Non-US) versus US Equities (The "Arguments")
Replies: 5351
Views: 905404

Re: International (Non-US) versus US Equities (The "Arguments")

Charles Joseph wrote: Sun Jan 21, 2024 4:17 pm For most of my investment life I've been 100% long US. Still am. See my sig.
For all my investment life I've had 25% international (it I believe was Market weight when I started). Still am

I could if I chose retire at 59 or before I reach that age. (liability matching with fixed income)

International was the right choice for about the first 10 years and the wrong choice next 10. 3 years into the third 10 year period so time will tell.

I'm confident in the strategy and I have no idea what the outcome will be in the long term with International diversification.
by Johm221122
Sat Jan 27, 2024 1:28 pm
Forum: Personal Investments
Topic: Deferred Fixed Annuities
Replies: 8
Views: 1112

Re: Deferred Fixed Annuities

There is a master thread with great information
viewtopic.php?t=334589
by Johm221122
Sat Jan 27, 2024 1:13 pm
Forum: Investing - Theory, News & General
Topic: Called to Account: 4 Overlooked Benefits of Trad. 401ks, IRAs
Replies: 86
Views: 6697

Re: Called to Account: 4 Overlooked Benefits of Trad. 401ks, IRAs

Let not forget that when those SS and other $ exceed the exception point, the SS tax rate structure is set to catch up, at essentially at 22%. Thus with $50K of SS, any other income above approx $30K will be taxed at 22%. $80K is far below where most people associate 22% starting. In my working years, I was close to the top of the then 15% bracket (now 12%), so all those deferred $ went in at 15%, yet as I withdraw them currently I'm paying 22% on about 1/2 of those deferred withdrawals. I am extremely glad I fully funded my and DW Roths instead of putting more $ my 401K. If you were in 15% tax bracket - and now you are in 22% bracket -- its possibly caused by a few factors: 1) Your pay wasn't all that great back when working 2) You worked...
by Johm221122
Sat Jan 27, 2024 1:06 pm
Forum: Investing - Theory, News & General
Topic: Called to Account: 4 Overlooked Benefits of Trad. 401ks, IRAs
Replies: 86
Views: 6697

Re: Called to Account: 4 Overlooked Benefits of Trad. 401ks, IRAs

I did not over save. I retired with 25X needed, on top of our SS, to maintain our modest standard of living. I'm trapped in the 22% bracket because of the arcane SS taxation rules, which were set 30+ years ago without any inflation factoring, when having more than $44K of SS and other income was considered to be uber-rich. Today, it's not 'rich'. Just curious and it's okay if you don't want to answer but what is your effective tax rate? Not the person you quoted, but for a SINGLE filer over 65 with $44K of Social Security benefits and taking 4% withdrawals on a $1M tax-deferred portfolio, total income tax is $6880, or about 17% on the IRA withdrawals even after accounting for the impact of making SS benefits partially subject to income tax...
by Johm221122
Sat Jan 27, 2024 12:29 pm
Forum: Investing - Theory, News & General
Topic: Called to Account: 4 Overlooked Benefits of Trad. 401ks, IRAs
Replies: 86
Views: 6697

Re: Called to Account: 4 Overlooked Benefits of Trad. 401ks, IRAs

Even here I think many people get too excited about Roths and expect to be in a higher retirement tax bracket than they actually will be. An over 65 couple can have $40K in Social Security and $24K in taxable IRA withdrawals and owe no federal income taxes and most states do not tax Social Security so they may not owe any state income taxes either. Where I live $65K a year is ample for a middle class lifestyle if you have a paid off house. During my working years I also had; a mortage payment child raising/college cost retirement savings higher income taxes FICA taxes Which I do not have now. There are of course other new expenses in retirement but I would guess that $65K now would be equivalent to well over earning and income $100K when I...
by Johm221122
Sat Jan 27, 2024 11:57 am
Forum: Investing - Theory, News & General
Topic: Called to Account: 4 Overlooked Benefits of Trad. 401ks, IRAs
Replies: 86
Views: 6697

Re: Called to Account: 4 Overlooked Benefits of Trad. 401ks, IRAs

celia wrote: Sat Jan 27, 2024 11:49 am
iceport wrote: Sat Jan 27, 2024 10:01 am The benefits outlined:

— Tax-free growth—or better.
The growth (and the contribution) are not tax-free. They are just tax-deferred.

As the account value grows, so does Uncle Sam's share of it. Eventually, he wants his share.
Which leads to your decision based on your tax rate now vs in retirement.
by Johm221122
Sat Jan 27, 2024 11:54 am
Forum: Personal Finance (Not Investing)
Topic: Retiring early: Health Insurance
Replies: 97
Views: 11336

Re: Retiring early: Health Insurance

madbrain wrote: Fri Jan 26, 2024 1:35 pm
eg1 wrote: Thu Jan 25, 2024 3:06 pm Health insurance is basically a catastrophic care insurance at this point for most people.
That is incorrect. According to the CDC, 51.8% of Americans have a chronic medical condition, and 27.2% have several. 90% of all health care costs in the U.S. go toward treating chronic disease and mental health.
And your Data provided shows me why personal finances are personal. I see a lot of information on healthcare and it's cost in retirement and depending on if you have a chronic disease/mental health issue your costs will vary widely.
My health care costs are extremely minimal and I may actually pay nothing pre Medicare when I retire (Bronze plan).
by Johm221122
Sat Jan 27, 2024 10:57 am
Forum: Investing - Theory, News & General
Topic: Called to Account: 4 Overlooked Benefits of Trad. 401ks, IRAs
Replies: 86
Views: 6697

Re: Called to Account: 4 Overlooked Benefits of Trad. 401ks, IRAs

There are a lot of factors that lead people to underestimate traditional accounts. Some that come to mind: 2. Even on this board, people tend to way overestimate the likelihood their taxes will go up. Tax rates have actually been remarkably stable. And of course what matters most is the tax rate that applies to you personally - and for the vast majority of people, that is a lower rate in retirement than during working years. For anyone married, taxes going up is almost a certainty, as most likely there will be a "last one standing" who will be forced into single tax rates. For married Boglehead couples maybe it's likely but with the savings rate in this country I don't think so. Most people or couples don't have million dollar po...
by Johm221122
Sat Jan 27, 2024 10:43 am
Forum: Personal Investments
Topic: parking cash for next 5 years -which option would you choose?
Replies: 17
Views: 3058

Re: parking cash for next 5 years -which option would you choose?

If you will be over 59.5, I would price a deferred "Term certain annuity"

Call someone like Stan the annuity Man or immediate annuities dot com and see what you can get. I'm not necessarily saying it'll be the best deal and you should take it but at least look at it

A term certain annuity will pay you monthly for a set term
by Johm221122
Sat Jan 27, 2024 10:20 am
Forum: Investing - Theory, News & General
Topic: Called to Account: 4 Overlooked Benefits of Trad. 401ks, IRAs
Replies: 86
Views: 6697

Re: Called to Account: 4 Overlooked Benefits of Trad. 401ks, IRAs

I'm always confused why before the Roth existed everyone talked about the benefits of Traditional accounts as mentioned above from article.
Now everyone always seems to betray traditional accounts so bad. The math hasn't changed, you will either pay less taxes in retirement than you did working or you won't.
I do understand the benefits of choosing a Roth over Traditional for some people but the overwhelming amount of financial articles seem to forget about the benefits of Traditional.
by Johm221122
Sat Jan 27, 2024 12:01 am
Forum: Personal Investments
Topic: Investing Horizon Transition
Replies: 8
Views: 1246

Re: Investing Horizon Transition

If you choose to 15% long term bond you could just stick to that forever.
When you choose to add more bonds then just add something shorter term.

Now 85% stocks and 15% long term bonds
Later something like 60% stocks,15% long term bonds and 25% Short term bonds
by Johm221122
Fri Jan 26, 2024 10:35 am
Forum: Personal Investments
Topic: VGT vs QQQM
Replies: 9
Views: 1765

Re: VGT vs QQQM

maggie88li wrote: Fri Jan 26, 2024 9:57 am I am currently start investing in VGT. However, the price of VGT is much higher than QQQM. Looks like their performance is pretty much the same, since they both passively follow Nasdaq 100.

Should I change to QQQM for lower price? I would like to hold for long time say over 5 years.

Could anyone give some advice/comments on the difference of VGT and QQQM? Which one is more preferable for long term investor?

Any input is appreciated.

Maggie.
Try this link on asking portfolio questions
https://www.bogleheads.org/wiki/Asking_ ... _questions

Investing is long term and chasing performance could be dangerous
by Johm221122
Fri Jan 26, 2024 10:31 am
Forum: Personal Investments
Topic: Principal 401k Investment options
Replies: 6
Views: 552

Re: Principal 401k Investment options

Try this link on asking portfolio questions
https://www.bogleheads.org/wiki/Asking_ ... _questions

But it looks like you have a great plan
by Johm221122
Fri Jan 26, 2024 9:13 am
Forum: Personal Investments
Topic: question about 60/40 rule
Replies: 15
Views: 1846

Re: question about 60/40 rule

shorty321 wrote: Fri Jan 26, 2024 9:10 am Is the current thinking that the 60/40 rule is still good to apply for today or should some of the 40% be in alternatives? Note: I am holding Vanguard Mutual funds in my retirement accounts.
This is an individual decision based on individual circumstances. You have shared nothing for us to help you.

But 60/40 is fine historically and should be fine in the future if it makes sense for your situation
by Johm221122
Thu Jan 25, 2024 9:46 am
Forum: Investing - Theory, News & General
Topic: Why not just VOO and chill?
Replies: 78
Views: 8460

Re: Why not just VOO and chill?

visualguy wrote: Thu Jan 25, 2024 9:44 am
ksualum wrote: Thu Jan 25, 2024 9:33 am
02nz wrote: Wed Jan 24, 2024 6:39 pm
thatbrian wrote: Wed Jan 24, 2024 3:02 pm Do we really need bonds and international?
Funny how these "Why not 100% stocks" posts pop up when the stock market has had a great few months, and not say around March 2020. It's almost as though recency bias were a thing.
Exactly! I feel like we could probably use this forum as a predictor of a change in outperformance. Recency bias at its best. If international starts outperforming you will start seeing post like "what percentage of your portfolio should one allocate to international and emerging markets"
Doubtful. Ex-US is so hopelessly behind that even if it outperforms for a while at some point, who cares.
The new investor? Someone investing large sums currently?
by Johm221122
Thu Jan 25, 2024 9:46 am
Forum: Investing - Theory, News & General
Topic: Why not just VOO and chill?
Replies: 78
Views: 8460

Re: Why not just VOO and chill?

Per a Bogleheads University presentation, 100% VOO would be a reasonable portfolio. See: https://youtu.be/1fsJXtmrP78?si=sGe0AFVMIvdf1qEI&t=421 There are also many other reasonable portfolios. Sure, it's reasonable. But the thread title was "why not"? Posters are giving the downsides, in line with the topic. Jim Dahle explains it very well in the presentation, including the downsides of each reasonable portfolio. I highly recommend it. The Boglehead panel also unanimously agreed that international inclusion is recommended https://youtu.be/M8hCihGSbds?si=fTSPi0DfQDB-W6v4 32 minutes I really enjoyed the segment about US and international and the mention of cap diversification in the discussion. It's exactly how I feel about my ...
by Johm221122
Wed Jan 24, 2024 11:15 pm
Forum: Investing - Theory, News & General
Topic: Pre-tax vs Post-tax investments
Replies: 20
Views: 2091

Re: Pre-tax vs Post-tax investments

123 wrote: Wed Jan 24, 2024 10:46 pm One of the biggest short-comings of tax-deferred retirement accounts, such as a 401k or traditional IRA, is that the investor does not receive favorable capital gains tax treatment on stock holdings. The end result of any gain in stock holdings is taxed as ordinary income when it is distributed.

The primary benefit tax-deferred retirement accounts provide are tax penalties for early withdrawals so they are somewhat forced savings plans. Perhaps for most people that have them that generally turns out to be a good thing.
Matching money?
Not paying my top marginal tax rate going in and paying my effective tax rate in retirement? Do you actually know how little most people pay in taxes in retirement?
by Johm221122
Wed Jan 24, 2024 8:55 pm
Forum: Personal Investments
Topic: 20% bond allocation: BND or US treasury note better?
Replies: 28
Views: 3053

Re: 20% bond allocation: BND or US treasury note better?

niar wrote: Wed Jan 24, 2024 8:19 pm Hi

I am 39 yr old and doing an 80/20 allocation (80% stock and 20%bond) in my ROTH IRA.
For the 20% bond, I have been using BND (VANGUARD TOTAL BOND MARKET ETF) and BNDX (VANGUARD TOTAL INTL BOND INDEX ETF) .
I trying to decide if I should continue using BND or buy notes/bonds directly?
With the value of BND plummeting last year and US treasury notes (eg 10 yr) giving ~4% return, I am wondering if I should buy 10yr US treasury note, this time.

Please let me know if you have any thoughts on this.

Thank you for your time in advance.
Do you rebalance? And if you do would you sell the individual bond if it was less than par value

What do you think the yield of BND is?
by Johm221122
Wed Jan 24, 2024 6:37 pm
Forum: Investing - Theory, News & General
Topic: Why not just VOO and chill?
Replies: 78
Views: 8460

Re: Why not just VOO and chill?

thatbrian wrote: Wed Jan 24, 2024 6:15 pm
Nathan Drake wrote: Wed Jan 24, 2024 5:55 pm
thatbrian wrote: Wed Jan 24, 2024 5:52 pm
Yesterdaysnews wrote: Wed Jan 24, 2024 5:45 pm I have 10% international, including VXUS and often wonder why I don't just sell and dump into VTI or XLK. There are some gains but not that much. It is hard to get inspired to put more into VXUS.
To me, it makes no sense.

As goes the US, so goes the world, so if we tank, the rest of the world will follow; therefore, no much in the way of protection in downturns for the massive loss in upside.
That was not the case in 1966-1982

US tanked, exUS didn’t
Those days are never coming back.
And 2000 to 2010?
by Johm221122
Wed Jan 24, 2024 5:56 pm
Forum: Investing - Theory, News & General
Topic: Why not just VOO and chill?
Replies: 78
Views: 8460

Re: Why not just VOO and chill?

thatbrian wrote: Wed Jan 24, 2024 5:52 pm
Yesterdaysnews wrote: Wed Jan 24, 2024 5:45 pm I have 10% international, including VXUS and often wonder why I don't just sell and dump into VTI or XLK. There are some gains but not that much. It is hard to get inspired to put more into VXUS.
To me, it makes no sense.

As goes the US, so goes the world, so if we tank, the rest of the world will follow; therefore, no much in the way of protection in downturns for the massive loss in upside.
If your talking retirement then sequence of returns matters.
by Johm221122
Wed Jan 24, 2024 5:54 pm
Forum: Investing - Theory, News & General
Topic: Why not just VOO and chill?
Replies: 78
Views: 8460

Re: Why not just VOO and chill?

thatbrian wrote: Wed Jan 24, 2024 3:02 pm Do we really need bonds and international?

If only we knew the investment returns during our specific investing timeline. Historically most of the time we wouldn't have but that tells us nothing about your future timeline
by Johm221122
Wed Jan 24, 2024 1:53 pm
Forum: Investing - Theory, News & General
Topic: It's possible to do worse than 10th percentile in Monte Carlo?
Replies: 21
Views: 2508

Re: It's possible to do worse than 10th percentile in Monte Carlo?

If the worse 10% showed up would you not adjust something? I'll assume you have some amount of discretionary spending
by Johm221122
Tue Jan 23, 2024 8:53 pm
Forum: Personal Investments
Topic: buying callable bonds ?
Replies: 6
Views: 697

Re: buying callable bonds ?

02nz wrote: Tue Jan 23, 2024 8:22 pm
RustyShackleford wrote: Tue Jan 23, 2024 7:16 pm If rates do indeed fall, is it a near-given that the issuer will exercise their call ?
Why wouldn't they?
There has to be a cost to refinance the loans. I don't think Fidelity offers CDs for free
by Johm221122
Tue Jan 23, 2024 1:29 pm
Forum: Personal Finance (Not Investing)
Topic: Psychological Aversion to Decumulation Phase
Replies: 73
Views: 7444

Re: Psychological Aversion to Decumulation Phase

Not there yet but my solution is a SPIA and a Social Security ladder to 70. I will still live on a paycheck but it will be from my savings.

Then I'll just keep investing aggressively with the rest of my portfolio. Being more median income and saving a large percentage of my income,Social Security could easily cover all my basic living expenses
by Johm221122
Tue Jan 23, 2024 12:21 pm
Forum: Investing - Theory, News & General
Topic: What happened in 2012 that US stocks took off?
Replies: 28
Views: 3166

Re: What happened in 2012 that US stocks took off?

The TSM index is already outperforming International Index thru yesterday's close. Staggering to consider the average Boglehead's opportunity costs who's invested 20%-30% of their equities in International over the past 10 years. It's literally cost them hundreds of thousands of dollars :confused Yes,but unfortunately that is hindsight. Like holding bonds over the last 10 years. How many of us were to conservative with the great bull run. Then you could think about all those great individual stocks we missed. The bigger question is what does the future bring? If you have a 100% guaranteed crystal ball, we would appreciate the answer it's providing you According to the Dollar Milkshake Theory, the US will outperform the rest of the world by...
by Johm221122
Tue Jan 23, 2024 12:12 pm
Forum: Investing - Theory, News & General
Topic: What happened in 2012 that US stocks took off?
Replies: 28
Views: 3166

Re: What happened in 2012 that US stocks took off?

Flashes1 wrote: Tue Jan 23, 2024 12:08 pm The TSM index is already outperforming International Index thru yesterday's close. Staggering to consider the average Boglehead's opportunity costs who's invested 20%-30% of their equities in International over the past 10 years. It's literally cost them hundreds of thousands of dollars :confused
Yes,but unfortunately that is hindsight. Like holding bonds over the last 10 years. How many of us were to conservative with the great bull run. Then you could think about all those great individual stocks we missed.
The bigger question is what does the future bring? If you have a 100% guaranteed crystal ball, we would appreciate the answer it's providing you
by Johm221122
Tue Jan 23, 2024 10:20 am
Forum: Investing - Theory, News & General
Topic: S&P 500 Closes at Record High
Replies: 203
Views: 26410

Re: S&P 500 Closes at Record High

TimeIsYourFriend wrote: Tue Jan 23, 2024 9:36 am I'm one of those who feels most comfortable investing when the market has taken a huge hit. When it looks like a frenzy like it is now [for AI] pushing up a small number of already-large stocks "to the moon", I don't feel that great about it and I'm glad then to have a value side of the portfolio.
I'm not sure comfortable is what I would describe my feelings. I'd say more know it's a long term opportunity

I've in the past always went more aggressive after a big dip. Last drop I actually went 100% stocks. But this was most likely the last time for me because I'm getting close to retirement
by Johm221122
Tue Jan 23, 2024 9:30 am
Forum: Investing - Theory, News & General
Topic: S&P 500 Closes at Record High
Replies: 203
Views: 26410

Re: S&P 500 Closes at Record High

atdharris wrote: Tue Jan 23, 2024 9:20 am I know it's wrong to time the market, but I am uneasy about funding my IRA right now with the run stocks have been on lately. Right now that money is sitting in a MMF earning 5.2%.
I've felt uneasy about the stock market maybe 80% of the time since I started. You'll always feel this way. Pick an asset allocation that works for your personal situation and keep investing
by Johm221122
Tue Jan 23, 2024 9:22 am
Forum: Investing - Theory, News & General
Topic: S&P 500 Closes at Record High
Replies: 203
Views: 26410

Re: S&P 500 Closes at Record High

How about high valuations? Reversion to the mean? Something in the US's immediate future? Not really - no good reason to believe that such things will be more impactful in the future than they've been in the past in terms of making the S&P 500 underperform in the long run. Unfortunately I'm worried about sequence of returns so the long run isn't my only goal 1999 valuations set off a pretty nasty SOR The trick, of course, is to not be 100% stocks. With bonds/TIPs/CDs/money-markets paying 4%-5% right now, there's absolutely no reason not to have a good chunk of money in those if you are worried about sequence of return risk (i.e., you are close to or in retirement). I mean, we've talked about this for years here. If you aware of sequenc...
by Johm221122
Tue Jan 23, 2024 9:11 am
Forum: Personal Investments
Topic: A Fund of US Stocks with High Intl Exposure?
Replies: 31
Views: 3139

Re: A Fund of US Stocks with High Intl Exposure?

I agree with what is wrong with Japan?

And 16% of your international stocks would be what percentage of your whole portfolio?
by Johm221122
Tue Jan 23, 2024 9:07 am
Forum: Investing - Theory, News & General
Topic: S&P 500 Closes at Record High
Replies: 203
Views: 26410

Re: S&P 500 Closes at Record High

HomerJ wrote: Tue Jan 23, 2024 9:03 am
Johm221122 wrote: Mon Jan 22, 2024 7:22 pm
visualguy wrote: Mon Jan 22, 2024 4:54 pm
Johm221122 wrote: Mon Jan 22, 2024 4:17 pm The S&P 500 HAS kept powering along. The future is unknown
Unknown, but not random. The action isn't going to shift to other stock asset classes because of some flip of a coin.
How about high valuations? Reversion to the mean? Something in the US's immediate future?
We've had high valuations 99% of the time since 1992, so it's now been 32 years.
It's not that I don't agree but my focus is next 10 years and the years 2000 to 2010 make me realize not diversifying away from 100% US large cap could possibly be a bad decision
Don't get me wrong I'm 50% S&P 500 and 75% US stocks so I'm not saying I'm down on US stocks, I just won't bet the farm on it
by Johm221122
Tue Jan 23, 2024 8:44 am
Forum: Investing - Theory, News & General
Topic: S&P 500 Closes at Record High
Replies: 203
Views: 26410

Re: S&P 500 Closes at Record High

visualguy wrote: Tue Jan 23, 2024 12:08 am
Johm221122 wrote: Mon Jan 22, 2024 7:22 pm
visualguy wrote: Mon Jan 22, 2024 4:54 pm
Johm221122 wrote: Mon Jan 22, 2024 4:17 pm The S&P 500 HAS kept powering along. The future is unknown
Unknown, but not random. The action isn't going to shift to other stock asset classes because of some flip of a coin.
How about high valuations? Reversion to the mean? Something in the US's immediate future?
Not really - no good reason to believe that such things will be more impactful in the future than they've been in the past in terms of making the S&P 500 underperform in the long run.
Unfortunately I'm worried about sequence of returns so the long run isn't my only goal
by Johm221122
Mon Jan 22, 2024 7:22 pm
Forum: Investing - Theory, News & General
Topic: S&P 500 Closes at Record High
Replies: 203
Views: 26410

Re: S&P 500 Closes at Record High

visualguy wrote: Mon Jan 22, 2024 4:54 pm
Johm221122 wrote: Mon Jan 22, 2024 4:17 pm The S&P 500 HAS kept powering along. The future is unknown
Unknown, but not random. The action isn't going to shift to other stock asset classes because of some flip of a coin.
How about high valuations? Reversion to the mean? Something in the US's immediate future?
by Johm221122
Mon Jan 22, 2024 7:20 pm
Forum: Investing - Theory, News & General
Topic: S&P 500 Closes at Record High
Replies: 203
Views: 26410

Re: S&P 500 Closes at Record High

H-Town wrote: Mon Jan 22, 2024 5:01 pm
Johm221122 wrote: Mon Jan 22, 2024 4:17 pm The S&P 500 HAS kept powering along. The future is unknown
I know the future. I know it so well that I "bet my farm on it". I know all of us here, whether they know it or not, bet their assets on it too. Why else we invest in stock market? To lose money?
Yes I invest in the stock market including international stock markets. I will not bet the farm on just US large cap stocks. I am close to retirement and understand that something like a lost decade is possible
by Johm221122
Mon Jan 22, 2024 4:17 pm
Forum: Investing - Theory, News & General
Topic: S&P 500 Closes at Record High
Replies: 203
Views: 26410

Re: S&P 500 Closes at Record High

I’m wondering if foreign markets have hit an all time adjusted to inflation high? Btw how would one go about factoring that in vs the SP500…weight the inflation rate of various countries given their percent makeup of the fund? 😃 Foreign stocks hit their all-time high on October 31, 2007. For the past 15+ years they have had a negative real rate of return. And this chart doesn’t account for the higher costs/taxes of international investing which I’ve detailed in a recent post, further pushing international real returns into negative territory. To put these poor returns into perspective, in Stocks for the Long Run Jeremy Siegel says: “It is very significant that stocks (US), in contrast to bonds or bills, have never delivered to investors a ...
by Johm221122
Mon Jan 22, 2024 3:29 pm
Forum: Investing - Theory, News & General
Topic: S&P 500 Closes at Record High
Replies: 203
Views: 26410

Re: S&P 500 Closes at Record High

Shiller CAPE 32 and gains concentrated in 7 mega caps. Doesn't feel like a real victory for the portfolio going forward even though logically buy and hold is the most efficient method of investing. I just wish the rest of the market would follow suit in some way - feels like a bubble (not that I would do anything about it). Well if the US market is currently being pushed by 7 mega cap stocks doesn't that seem like maybe international, small cap,mid cap and value may carry the returns in near future. Not saying anyone should time the market but they should always be diversfied. I could never be 100% Large cap US or technology The question is at what point diversification becomes diworsification. I never felt comfortable with 100% large cap ...
by Johm221122
Mon Jan 22, 2024 2:09 pm
Forum: Investing - Theory, News & General
Topic: Rick Ferri's book on Asset Allocation
Replies: 5
Views: 1875

Re: Rick Ferri's book on Asset Allocation

It was one of those books that absolutely opened my mind up on the total picture on investing. I actually read it twice.

It was a game changer for me as a young investor.
by Johm221122
Mon Jan 22, 2024 9:09 am
Forum: Investing - Theory, News & General
Topic: S&P 500 Closes at Record High
Replies: 203
Views: 26410

Re: S&P 500 Closes at Record High

TimeIsYourFriend wrote: Mon Jan 22, 2024 8:45 am Shiller CAPE 32 and gains concentrated in 7 mega caps. Doesn't feel like a real victory for the portfolio going forward even though logically buy and hold is the most efficient method of investing. I just wish the rest of the market would follow suit in some way - feels like a bubble (not that I would do anything about it).
Well if the US market is currently being pushed by 7 mega cap stocks doesn't that seem like maybe international, small cap,mid cap and value may carry the returns in near future.
Not saying anyone should time the market but they should always be diversfied. I could never be 100% Large cap US or technology
by Johm221122
Mon Jan 22, 2024 9:01 am
Forum: Investing - Theory, News & General
Topic: Would Disappointed BND Investors Have Been More Satisfied with a Short-Duration Fund (e.g. BSV)?
Replies: 455
Views: 26872

Re: Would Disappointed BND Investors Have Been More Satisfied with a Short-Duration Fund (e.g. BSV)?

LaramieWind wrote: Mon Jan 22, 2024 4:37 am So what is the alternative to BND? CD's will give a guaranteed rate but only for so long. Same with Treasuries. What it safe?
All investments have risk. Diversification is the only free lunch . Your asset allocation should be based on your personal situation.
by Johm221122
Mon Jan 22, 2024 8:29 am
Forum: Investing - Theory, News & General
Topic: S&P 500 Closes at Record High
Replies: 203
Views: 26410

Re: S&P 500 Closes at Record High

If I told you that you were getting a 5% raise from January 2022 would you go "Whoopee, I have my highest salary ever!" even though you would be poorer than you were in 2022 due to 9% inflation? This is completely irrelevant to the following statement: on January 19th, 2024 the S&P 500 Index reached a new high of 4839.81. No further comment is necessary. And reaching all time highs is completely irrelevant without taking into account inflation and real returns. No it's not completely irrelevant 1. Many people invest new money and gained from lows of last year till the new highs 2. Some people rebalanced at lows and now have decent gains Possibly, but a good percentage of us have no earned income and are therefore are not inve...
by Johm221122
Sun Jan 21, 2024 9:47 pm
Forum: Investing - Theory, News & General
Topic: S&P 500 Closes at Record High
Replies: 203
Views: 26410

Re: S&P 500 Closes at Record High

Nathan Drake wrote: Sun Jan 21, 2024 9:36 pm
Charles Joseph wrote: Sun Jan 21, 2024 8:34 pm
billaster wrote: Sun Jan 21, 2024 7:39 pm If I told you that you were getting a 5% raise from January 2022 would you go "Whoopee, I have my highest salary ever!" even though you would be poorer than you were in 2022 due to 9% inflation?
This is completely irrelevant to the following statement: on January 19th, 2024 the S&P 500 Index reached a new high of 4839.81.

No further comment is necessary.
And reaching all time highs is completely irrelevant without taking into account inflation and real returns.
No it's not completely irrelevant
1. Many people invest new money and gained from lows of last year till the new highs
2. Some people rebalanced at lows and now have decent gains
by Johm221122
Sun Jan 21, 2024 8:19 pm
Forum: Personal Investments
Topic: Brokered CD’s
Replies: 12
Views: 1639

Re: Brokered CD’s

Narti wrote: Sun Jan 21, 2024 1:21 pm Hello Everyone!

I just rolled over some funds from my Thrift Savings Account to a Vanguard IRA. I purchased a one year term, brokered CD @ 5.2% rate. Should I have purchased a regular bank CD instead of the brokered? I understand the brokered cd is callable. Does the issuer often call these types of cd’s if interest rates begin to rise?
If interest rates rise why would they call CD? You mean if rates drop it could possibly be called

My question is why a one year CD? Why not stocks, target retirement fund or something longer than a one year CD
by Johm221122
Sun Jan 21, 2024 7:56 pm
Forum: Personal Investments
Topic: Re-Assessing Risk at 50
Replies: 42
Views: 4778

Re: Re-Assessing Risk at 50

Rachel5590 wrote: Sun Jan 21, 2024 10:25 am Anyone else out there around 50? What's your risk profile look like?

I'm 54 and hopefully 8 years to my goal

I Bonds and CDs in taxable about 4 years of current expensese
I just sold enough stocks in IRA to cover about 6 years current expenses invested in CDs

The rest in stocks and all new contributions and IRA CDs interest invested in stocks. I basically have enough in safe assets to last me until Social Security (which at 64 would cover my current expenses).

I'll keep investing new money in stocks until I reach my goal. But my goal would be to spend twice as much in retirement as I do now. But if something was to happen I have liability matched enough to survive till Social Security
by Johm221122
Sun Jan 21, 2024 4:43 pm
Forum: Personal Investments
Topic: A short Primer on Annuities.
Replies: 44
Views: 6452

Re: A short Primer on Annuities.

Gennaro Dillinger wrote: Sun Jan 21, 2024 4:02 pm I am a bit perplexed by SPIAs or any annuities. The payment will in fact begin to dwindle in spending power due to inflation, too. Had you kept the $ you may have doubled it even several times in this period.
You don't compare a SPIA against keeping your money and investing it. Your comparison would be a safe withdrawal rate or variable withdrawal rate.
If you want to keep investing and not spend money then a SPIA definitely isn't a good product
by Johm221122
Sun Jan 21, 2024 4:26 pm
Forum: Investing - Theory, News & General
Topic: S&P 500 Closes at Record High
Replies: 203
Views: 26410

Re: S&P 500 Closes at Record High

I planned to contribute 2k/month to VFIAX (Vanguard 500 Index Admiral) but as the value continues to increase it gets harder to contribute. Any thoughts or tips for my nervousness? Why only US large cap stocks? As mentioned diversification like International stocks is a way to hedge against 100% US large cap stocks Do you think the market will be up from current number in 5 or 10 years. If yes then you will be ahead. I started do this in my taxable account in 2013 consistently for the past decade and throughout there were plenty of periods of”all time highs”. I took advantage of tax lost harvesting during period of pull backs and bear markets and was still able to stay in the market during that stretch in 2022 and in hind site very happy I...
by Johm221122
Sun Jan 21, 2024 7:21 am
Forum: Investing - Theory, News & General
Topic: S&P 500 Closes at Record High
Replies: 203
Views: 26410

Re: S&P 500 Closes at Record High

rt4 wrote: Sat Jan 20, 2024 1:54 pm I planned to contribute 2k/month to VFIAX (Vanguard 500 Index Admiral) but as the value continues to increase it gets harder to contribute.
Any thoughts or tips for my nervousness?
Why only US large cap stocks?
As mentioned diversification like International stocks is a way to hedge against 100% US large cap stocks
by Johm221122
Sat Jan 20, 2024 11:03 am
Forum: Investing - Theory, News & General
Topic: S&P 500 Closes at Record High
Replies: 203
Views: 26410

Re: S&P 500 Closes at Record High

yules wrote: Sat Jan 20, 2024 9:29 am
Taylor Larimore wrote: Fri Jan 19, 2024 7:31 pm Bogleheads:

Good news for Bogleheads who stay the course using low cost, tax-efficient, broad market index funds.

Best wishes.
Taylor
Jack Bogle's Words of Wisdom: "Deep down, I remain absolutely confident that the vast majority of American families would be will served by owning their equity holdings in a S&P 500 Index fund (or a total stock market index fund)."
Time to Rebalance into bonds and international stocks, then.

Yules
Don't forget small and mid cap stocks
by Johm221122
Fri Jan 19, 2024 11:53 am
Forum: Investing - Theory, News & General
Topic: Should Fixed Income be changed in 3-fund portfolio?
Replies: 95
Views: 8993

Re: Should Fixed Income be changed in 3-fund portfolio?

Parkinglotracer wrote: Thu Jan 18, 2024 7:37 am What’s not to like about a treasury ladder? Too much work placing a couple trades a year? Always getting one’s bond value back?
It's not available in my 401k without paying brokerage window fees

Reinvesting interest is harder and while it works out great with inverted yield curve, that's not guaranteed to last

Investment minimums. I invest every paycheck
by Johm221122
Wed Jan 17, 2024 2:34 pm
Forum: Investing - Theory, News & General
Topic: Would Disappointed BND Investors Have Been More Satisfied with a Short-Duration Fund (e.g. BSV)?
Replies: 455
Views: 26872

Re: Would Disappointed BND Investors Have Been More Satisfied with a Short-Duration Fund (e.g. BSV)?

It would be helpful if this were to be added to the Wiki on bonds. Interest rate risk is discussed in this wiki article: https://www.bogleheads.org/wiki/Bond_basics This wiki link has specifics: https://www.bogleheads.org/wiki/Bonds:_advanced_topics#Duration I’ve seen many posts talking about how a bond fund price changes with interest rate changes, and whether the interest rate change is a one time change or is a sequence of changes. Turns out that for a linear increase in rates, you get back to even in approximately 2D-1 years, where D is the duration. For a single change, back to even is approximately D years. What is not in the Wiki is advice to reduce TBM as you get closer to retirement. As you get closer to retirement doesn't that me...
by Johm221122
Wed Jan 17, 2024 2:22 pm
Forum: Investing - Theory, News & General
Topic: Would Disappointed BND Investors Have Been More Satisfied with a Short-Duration Fund (e.g. BSV)?
Replies: 455
Views: 26872

Re: Would Disappointed BND Investors Have Been More Satisfied with a Short-Duration Fund (e.g. BSV)?

If your intent is to make the point that I was an idiot to invest in Total Bond fund, I am fully admitting that I am. You were not an idiot to invest in Total Bond. It was and still is a good choice. It is unfortunate that you did not realize that Total Bond would lose about 6% in value for each 1% increase in interest rates. This is well known and long known behavior. For you, it's a case of "You don't know what you don't know". It is also understandable to be disappointed when an asset doesn't act like you expect it to act, especially if you feel like you have researched the matter before buying it. But you can't blame the asset for what you didn't know. Total Bond did exactly what it was expected to do. Nobody is happy about i...