Search found 1701 matches

by Frugal Al
Mon Feb 13, 2017 7:22 am
Forum: Personal Finance (Not Investing)
Topic: Permanent Life Insurance
Replies: 20
Views: 4652

Re: Permanent Life Insurance

The insurance agent seems to be offering boiler plate justification for permanent insurance. It appears the agent believes, as they are often taught, that everyone needs some permanent insurance. I don't see any of the conditions present that sometimes makes permanent insurance a reasonable product: business transference, illiquid estate planning, caring for long term disabled dependents, to name a few. The general guidance often offered here applies: 1) don't commingle insurance and investments, and 2) most people don't need permanent insurance. I'll go further and point out that there isn't an OBVIOUS need for life insurance of any kind in this particular case--though there may be one. I do find it laughable that the insurance advisor is ...
by Frugal Al
Fri Feb 10, 2017 2:34 pm
Forum: Personal Consumer Issues
Topic: Plumbing issue - advice sought
Replies: 47
Views: 5185

Re: Plumbing issue - advice sought

I have experienced the same issue and still have 3 holes in my ceiling...depending on a few things which have not happened just yet, we plan to sell our home in 3 months to 2 years. Our plumbing has been plagued with leaks just as you describe so wife and I agreed to leave the holes in the ceiling until we decide to fix the house to sell. My fear is that we fix the hole and it leaks again. Not to hijack the thread but this sounds like my wife and I. Been in our house 27 years--plumbed with copper. Six years ago we got a pinhole leak in a vertical copper pipe coming out of the hot water tank located in the basement. I easily found it and repaired it, cutting a hole in the hall closet. Fast forward 6 years and we had another pinhole leak, th...
by Frugal Al
Wed Feb 08, 2017 4:36 am
Forum: Personal Consumer Issues
Topic: Rule of Thumb for Getting Rid of Car
Replies: 51
Views: 10512

Re: Rule of Thumb for Getting Rid of Car

While I'm generally inclined to agree with the Doc, I have to make an exception in this case. Although these cars are great fun, they were not good or reliable cars when new and, unlike a fine wine, they don't get better with age. Unless you turn your own wrenches, this vehicle will probably be a money pit. That's not saying there isn't a lot of fun left in the car FOR THE RIGHT PERSON, but that fun will come at a price...labor or $$$. If the reliability or an occasional $1500 repair bill isn't a concern, keep it.
by Frugal Al
Sun Feb 05, 2017 8:31 am
Forum: Personal Finance (Not Investing)
Topic: Quicken's future direction - a cause for concern
Replies: 516
Views: 99584

Re: Quicken's future direction - a cause for concern

I like Quicken and use every feature of the software. I could go with an annual payment of $30 to $40 bucks or so, but anything approaching $75 to $80 and I'll be done with it.
by Frugal Al
Tue Jan 31, 2017 6:21 am
Forum: Personal Consumer Issues
Topic: Sump pump and power outage
Replies: 53
Views: 8901

Re: Sump pump and power outage

just frank wrote:Of the close to 1000 deaths in the US due to CO over the last decade (that did not involve a fire), about 80% involved exhaust from a generator.

A battery CO alarm is a required accessory.
As we approach spring storm season, this cautionary advice definitely bears repeating. Thanks for the heads-up, j frank. Also thanks to hille141 for the info about the quiet check valve. Very helpful thread.
by Frugal Al
Thu Jan 26, 2017 3:59 am
Forum: Personal Finance (Not Investing)
Topic: What investment firm for small investors?
Replies: 14
Views: 1978

Re: What investment firm for small investors?

I've been a diehard Vanguard fan for years, but I'm concerned that Vanguard is growing too fast. I've recently helped a family member establish accounts there and the customer service is dreadful. Out of nowhere they froze all accounts and threatened to turn them over to the state, because a piece of mail had been returned undeliverable--no phone call or anything. The persons husband had died and she was forced to move unexpectedly because she couldn't drive at the time. Vanguard then took 3 weeks to process a change of address form--couldn't move funds, or buy/sell anything. When an inquiry was made as to how long it would take to re-activate the account, all they could say was it's in the queue and that's all they can do--pathetic!
by Frugal Al
Tue Jan 24, 2017 9:06 am
Forum: Personal Consumer Issues
Topic: When to proactively replace water heater
Replies: 60
Views: 9922

Re: When to proactively replace water heater

Take_Five, given the heavy usage, the good run you've gotten out of the tank, the lack of anode replacement, and the hard water, I wouldn't hesitate to replace the tank at 20 years. On the other hand, if it's located in a space with no collateral damage potential, you'll be doing the work yourself, and don't mind the surprise when it goes, there's an argument to just wait. I suspect you'd have a hard time even inspecting the anode at this time as it's probably corroded in. I like to repair and replace things on MY time table, not fates. As Watty points out in an above post, replacing now will allow you to negotiate better pricing. It's hard to negotiate with a plumber when there are four unbathed family members breathing down your back to g...
by Frugal Al
Mon Dec 19, 2016 3:27 pm
Forum: Personal Consumer Issues
Topic: Grocery cart rolls into side of car, dent, scratched
Replies: 92
Views: 12821

Re: Grccery cart rolls into side of car, dent, scratched

I think this is often handled on a case by case basis, regardless of the actual legal responsibility. No one wants to lose a customer. Was there an inordinate number of carts in the parking lot? Was the grocer making a reasonable effort to clear the parking lot? Was the grocer negligent in providing a safe parking area? My wife successfully negotiated a $120 compensation for such an incident. The carts being used were made with a relatively lightweight xenoy resin material that would sail across the parking lot with the slightest wind. Although in still air they presented little risk of damage, the carts could really get moving in a wind. My wife looked at the parking lot video with the manager showing the cart impact. My wife is a good neg...
by Frugal Al
Fri Nov 04, 2016 6:58 am
Forum: Personal Consumer Issues
Topic: Buying an Audi A4
Replies: 73
Views: 12889

Re: Buying an Audi A4

Make sure the extended warranty covers walnut blasting of the valves due to carbon build-up.
by Frugal Al
Thu Oct 13, 2016 3:57 am
Forum: Investing - Theory, News & General
Topic: Navy Federal Credit Union - not so different from banks
Replies: 45
Views: 9964

Re: Navy Federal Credit Union - not so different from banks

Maybe there is more to it, but it seems like NFCU got railroaded on this one--nothing so egregious as to warrant the hefty fine. In the old days it was common place for a creditor to contact one's commanding officer for failure to pay. Apparently that's not the case anymore. I think the CFPB is a bit heavy handed in some instances.
by Frugal Al
Thu Oct 13, 2016 3:52 am
Forum: Investing - Theory, News & General
Topic: NFCU - Some Certificate Rates Drop
Replies: 3
Views: 958

Re: NFCU - Some Certificate Rates Drop

Maybe there is more to it, but it seems like NFCU got railroaded on this one--nothing so egregious as to warrant the hefty fine. In the old days it was common place for a creditor to contact one's commanding officer for failure to pay. Apparently that's not the case anymore.
by Frugal Al
Sun Oct 02, 2016 4:40 am
Forum: Investing - Theory, News & General
Topic: SS as a Bond
Replies: 46
Views: 10112

Re: SS as a Bond

#Cruncher wrote:For $30,000 a year for 25 years to have a $325,000 present value requires a discount rate of about 7.83%. That is way too high, in my opinion. Since SS benefits are CPI-indexed a better discount rate would be that of long term TIPS, which currently yield about 0.6%. (See WSJ TIPS Quotes 6/30/2016.) Using this as the discount rate produces a present value of about $695,000.
But this would not be an actuarial PV; a mortality weighting scheme would also need to be applied--lowering the value somewhat. Most SS recipients would see fewer than 25 years of payments.
by Frugal Al
Thu Sep 22, 2016 7:53 am
Forum: Personal Finance (Not Investing)
Topic: Yup, another pension buyout offer...
Replies: 20
Views: 4543

Re: Yup, another pension buyout offer...

[*]Assuming pension payments are collected in full until life expectancy and then cease completely, isn't the best way to estimate the expected value. A better way weights the pension amount every year by the probability of surviving to that age Cruncher, with all due respect, while your approach is sound and brings a standardization to these numbers, the mortality weighting is only better if one somehow falls into the category of totally average health/longevity and its associated probabilities, or you are an insurance company who is calculating its liability for a population of annuitants. Neither average longevity nor mortality weighting is best for an individual--too many variables. For a healthy individual with a healthy lifestyle and...
by Frugal Al
Wed Sep 14, 2016 12:12 pm
Forum: Investing - Theory, News & General
Topic: Presidential Election Insurance, Use T-Bills?
Replies: 65
Views: 7850

Re: Presidential Election Insurance, Use T-Bills?

JonnyDVM wrote:Greenspan seems to agree with me. He never comes out and says exactly who he is talking about. He probably posts on this forum
It would appear this thread has gotten overly political. As for Greenspan, he has zero credibility and knows as little about forecasting as everyone else. He was asleep at the wheel when it mattered most.
by Frugal Al
Sun Aug 28, 2016 2:44 pm
Forum: Personal Finance (Not Investing)
Topic: Can we get by without permanent life insurance?
Replies: 85
Views: 9578

Re: Can we get by without permanent life insurance?

climber2020 wrote:You're not missing anything. Brother in law is a tool and should be treated accordingly.
The training for many (most???) life insurance salespeople really pushes home the mistaken concept that virtually EVERYONE needs some form of permanent life insurance. I've had friends who have had this training---good, well-meaning, people that just didn't know better. They didn't realize the disservice they were doing to their family, friends, and any other warm body they met...until later. I wouldn't be too hard on the brother-in-law--at least not yet. Maybe also have HIM read ole meph's chapter in the Bogleheads Guide.... No one is beyond redemption.
by Frugal Al
Sat Aug 27, 2016 9:19 am
Forum: Personal Consumer Issues
Topic: Honda maintenance schedule?
Replies: 57
Views: 20177

Re: Honda maintenance schedule?

The door jamb is fine if you just want comfort, but there is not harm in any value between the door jamb and the max sidewall That statement is not true, and the article referenced points out that there are many variables that determine the optimal tire pressures. Let's not read more into the article than is there. Most people would be ill-served by running the max tire pressures listed on the sidewall, they are max for the tire, not the vehicle. Some cars would be downright dangerous at max pressures. Every vehicle has different handling dynamics, and the types of roads and temperatures add even more variables. Most engineering specifications are the result of compromises, erring on the side of safety. Most people will be best served by s...
by Frugal Al
Wed Aug 24, 2016 3:08 pm
Forum: Personal Investments
Topic: Seemingly Too Good To Be True Investment Opportunity: Invest or Don't?
Replies: 85
Views: 10017

Re: Seemingly Too Good To Be True Investment Opportunity: Invest or Don't?

TropikThunder wrote:Does that business philosophy sound like a public figure we all know?
Wow, I'm doing my best to think of it TropikThunder, but I can't come up with a name. If you can't add something constructive, keep it to yourself. For the OP, I wouldn't get involved in this deal unless I was hands on with the business venture on a daily basis. And then I still don't think I'd do it.
by Frugal Al
Sat Aug 20, 2016 10:52 am
Forum: Personal Consumer Issues
Topic: Best Crossover SUV to purchase
Replies: 146
Views: 31600

Re: Best Crossover SUV to purchase

Varick, what exactly do you mean by long term? I consider long term ownership to be 10+ years. If you are concerned about long term cost of ownership, well past the new or CPO warranty, the only reasonable candidates are Toyota/Lexus or Honda/Acura. The Volvo is nice. Audi's are nice. Even I've been tempted--I've recently read that the new A4 is quieter than a Mercedes S class (quietness is where I put my priorities these days). Both brands will be considerably more expensive to own over the long term than the ToyoHonda choices. That's just the way it is. Part of the EuroLuxo image is being wealthy enough to not care too much about long term cost of ownership. And if you're reasonably wealthy and don't care about maintenance, they are very ...
by Frugal Al
Mon Aug 15, 2016 4:18 am
Forum: Personal Finance (Not Investing)
Topic: You have $10 Million and 10 years to live. What would you do?
Replies: 55
Views: 9354

Re: You have $10 Million and 10 years to live. What would you do?

I believe there's an old punchline: "First, I'd ask my mother-in-law to move in and that 10 years will seem like an eternity."
by Frugal Al
Sun Aug 14, 2016 7:42 am
Forum: Personal Consumer Issues
Topic: Best Crossover SUV to purchase
Replies: 146
Views: 31600

Re: Best Crossover SUV to purchase

Even more to the point, stuffing a V6 on the RDX actually made it drive worse (go read any auto magazine review of the first year after they dropped the turbo 4) though it does appeal to buyers who are brainwashed to think more cylinders are always better. The current V6 RDX handles better than the earlier ones. And it's not that more cylinders are always better; it's that I don't necessarily want a turbocharger on my daily driver. Of course Honda put equally problematic VCM on their many of their V6s. I do think they've finally got the VCM sorted out, but it sadly appears Honda sees the handwriting (ability to legally rig EPA testing) on the wall. They will be increasing the usage of turbos in the future, like most other automakers. Turbo...
by Frugal Al
Wed Aug 03, 2016 11:58 am
Forum: Personal Finance (Not Investing)
Topic: How to value a deferred annuity?
Replies: 15
Views: 1715

Re: How to value a deferred annuity?

Enkidu wrote:The value of the QLAC would go up over time as long as you are alive..
That's not quite correct; the value would drop to zero if the annuitant were to contract a terminal illness that would take its toll prior to annuity commencement. In fact, there are many moving parts on such a valuation, including health status, inflation and interest rates; any of which might cause the valuation to go down. No different than valuing any other future stream of nominal payments, except for the mortality aspect.
by Frugal Al
Wed Aug 03, 2016 9:16 am
Forum: Personal Finance (Not Investing)
Topic: How to value a deferred annuity?
Replies: 15
Views: 1715

Re: How to value a deferred annuity?

...-it needs to be discounted to reflect my actuarial expectation. What will it be worth in 2035, when I am 84? If I'm dying of cancer, probably $0. If I'm running marathons, maybe a lot more than $125K. The value of the insurance has already had the discount applied, and profit for the insurer. As inflation, your health, the prevailing interest rates, and the term changes, the value will correspondingly change. However, you've exchanged an investment asset for an insurance asset. While you will reap a benefit should you catastrophically :D live too long, should you die prematurely the value is zero. Like a term insurance policy, it should not be included in investment assets. That is not to say it may not impact other investments: it shou...
by Frugal Al
Mon Aug 01, 2016 2:57 pm
Forum: Personal Consumer Issues
Topic: Should I replace my hot water heater?
Replies: 15
Views: 2005

Re: Should I replace my hot water heater?

Has the anode rod ever been replaced? Regardless, 22 years is a good run. I suspect if the anode rod is replaced when needed, the new one might go 30 years. I'd definitely replace it. These things have a tendency to go out at the worst time. I try to estimate useful life of most of my appliances and equipment so I can negotiate pricing and installation without being in an emergency situation. Hard to negotiate when my wife is yelling at me about no hot water. In my opinion, being able to negotiate in a timely manner and avoiding emergency situations usually outweighs the marginal utility of old, end of life, equipment. Too many years in manufacturing I guess.
by Frugal Al
Sat Jul 30, 2016 5:47 am
Forum: Personal Consumer Issues
Topic: Ford Air Bag Recall
Replies: 4
Views: 661

Re: Ford Air Bag Recall

I understand every company may handle recalls differently. I think Honda would not give loaners for the passenger side airbag as the passenger can ride in the back seat. That is correct. I'm planning on disconnecting the passenger side should my driver side airbag get replaced earlier. On some cars that's not easy to do. My loaner is a Nissan Sentra. Not a bad car, but it doesn't have the capacity of my CR-V. When I went into the Honda dealership I had to wait about 1/2 hour for a car to be transported from another Hertz location--even though I called earlier in the day to arrange the pick-up. Because of the potential long term nature of the loaner and the low price Honda has negotiated, the rental companies have no incentive to offer an u...
by Frugal Al
Thu Jul 28, 2016 5:03 am
Forum: Personal Finance (Not Investing)
Topic: Small Pension vs. Small Lump Sum
Replies: 18
Views: 3815

Re: Small Pension vs. Small Lump Sum

jb3 wrote:Am I missing something?
Immediate Annuities, while a good tool and sales site, is really only accurate if annuitization is imminent. You won't be annuitizing for well over 20 years--current low rates make for a poor comparison. Secondly, a better comparison (if married) is using the monthly pension benefit for 100% joint life (not the 50% amount), just as the lump sum makes moot survivorship issues. I get about a 4.8% IRR at age 85 (with 50% survivorship), assuming current age around 43 (early 40's).

Usually, these tiny, non cola, pension amounts and long time horizons make the lump sum a better choice--assuming one can invest it properly. There's a lot that can happen during the 50 year time span ahead.
by Frugal Al
Sat Jul 09, 2016 7:33 am
Forum: Personal Finance (Not Investing)
Topic: Quicken
Replies: 33
Views: 3856

Re: Quicken

I think we get the drift, abuss: you don't like or miss Quicken. I find Quicken to be a time saver, and I agree with Toons that nothing else quite has the functionality at this time.
by Frugal Al
Thu Jul 07, 2016 6:56 am
Forum: Investing - Theory, News & General
Topic: "Why most retirees will never spend down their portfolio" by Michael Kitces
Replies: 89
Views: 15713

Re: "Why most retirees will never spend down their portfolio" by Michael Kitces

While I definitely appreciate the point that Cruncher is making, considering "real" spending assumptions, I think what Kitces is also pointing out is that consumption in the later years of retirement significantly lags inflation, making "real" assumptions problematic as well.
Here's another article referenced in the original posted article:
https://www.kitces.com/blog/estimating- ... ing-smile/
by Frugal Al
Wed Jun 29, 2016 12:53 pm
Forum: Personal Finance (Not Investing)
Topic: How to make an easy $500 like I just did [Chase bank offer]
Replies: 60
Views: 16151

Re: How to make an easy $500 like I just did [Chase bank offer]

madbrain wrote:I have no issue using Chase checking and credit cards with Quicken, and there is no fee for using Quicken.
Thanks for your response.
by Frugal Al
Tue Jun 28, 2016 6:59 am
Forum: Personal Finance (Not Investing)
Topic: How to make an easy $500 like I just did [Chase bank offer]
Replies: 60
Views: 16151

Re: How to make an easy $500 like I just did [Chase bank offer]

This promotion seems like it might be worth the trouble. For those of us who use Quicken, can anyone speak to using it with Chase? In the past they didn't always play well together, and I believe Chase charged an extra monthly fee for those using personal financial software. Also, Jamie Dimon isn't supportive of financial aggregation programs due to potential security complications--perhaps rightly so?
http://www.forbes.com/sites/samanthasha ... 4f7af43ee8
by Frugal Al
Thu Jun 23, 2016 3:48 pm
Forum: Investing - Theory, News & General
Topic: Why do people buy annuities?
Replies: 125
Views: 28358

Re: Why do people buy annuities?

technovelist wrote:Profitability is another problem, of course, but don't the insurers match maturities on liabilities and assets? That's the way I would run an insurance company (or a bank, which is another topic).
The insurance companies do attempt to liability match, but the nature of some of their very long durations make that a challenge. Also over time their product line can change, or newer products are poorly designed (think VAs and some GULs here), thereby increasing interest rate sensitivity. European regulators are really concerned about some of their insurance companies, but the pain is being felt here as well.
http://www.bloomberg.com/news/articles/ ... e-insurers
by Frugal Al
Tue Jun 21, 2016 4:51 am
Forum: Personal Finance (Not Investing)
Topic: Early Pension Payout Question
Replies: 11
Views: 2241

Re: Early Pension Payout Question

The lump sum available at age 65 is probably not too accurate, and not guaranteed, assuming this is a typical pension. Who knows what interest rates will be 26 years out. Also, a better IRR comparison is to use the 100% joint life payout amount, if available, since the survivorship feature is more similar to the lump sum. That would make the IRR something less than 5.1%.
by Frugal Al
Fri Jun 17, 2016 1:06 pm
Forum: Investing - Theory, News & General
Topic: Why do people buy annuities?
Replies: 125
Views: 28358

Re: Why do people buy annuities?

technovelist wrote:There is no other way to get longevity insurance than to buy a life annuity.
That's not entirely true. Although some can't afford to defer social security, the best value in longevity insurance is FIRST optimizing social security. I see too many people take SS early, only to turn around and buy an annuity.
by Frugal Al
Fri Jun 10, 2016 9:05 am
Forum: Personal Finance (Not Investing)
Topic: Evaluate Options - Lumpsum or Monthly
Replies: 4
Views: 657

Re: Evaluate Options - Lumpsum or Monthly

You could also get a quote on a deferred fixed annuity purchased with the lump sum. One place to do that is https://www.immediateannuities.com/annuity-calculators/?sce=hc. If the pension annuitization is imminent, say a year or two, comparing pricing to a commercially available annuity can be worthwhile. However, if the annuitization is not relatively near term, it's not necessarily a worthwhile comparison. With current interest rates still very low, the IRR on deferred annuities is pathetic for the most part. Who knows what pricing will be 10 or 20 years hence for a SPIA (interest rate up, pricing down). It's not really meaningful to compare a lump sum today to a deferred annuity starting years in the future, unless you HAVE TO BUY IT NOW...
by Frugal Al
Fri Jun 10, 2016 7:54 am
Forum: Personal Finance (Not Investing)
Topic: Pension-PBGC & Fund management
Replies: 9
Views: 921

Re: Pension-PBGC & Fund management

I wouldn't worry too much about the single employer PBGC coverage, provided that one falls within the coverage limits--it appears that at your age/amount it is within limits. Unless there are health/longevity issues, or tax management issues, and/or one is sitting on >50 times anticipated expenses, it's probably best to keep the pension and take risk elsewhere in the portfolio, particularly when the pension is providing the bulk of retirement income.
by Frugal Al
Tue May 31, 2016 9:35 am
Forum: Personal Investments
Topic: To take a pension distribution or not????
Replies: 11
Views: 1716

Re: To take a pension distribution or not????

nedsaid wrote:I realize what a good deal pensions are for employees but falling interest rates have made them increasingly expensive to fund for employers.
Whether or not they are expensive to the employer (plan sponsor) is immaterial, assuming it's within PBGC limits. All one should care about is whether or not the offer is beneficial or not to their own unique situation.
by Frugal Al
Tue May 31, 2016 9:04 am
Forum: Personal Investments
Topic: To take a pension distribution or not????
Replies: 11
Views: 1716

Re: To take a pension distribution or not????

Yes, the decision whether to take the lump sum or to take the pension can be a complicated decision with a lot of things to consider. I have read a lot of threads on this issue and a lot of informed opinion from posters. It seems that in most cases that the employee should keep the pension. Nesdaid, it was Prudential that took over GM's pension. Oh, and I've been a poster in a lot of those threads you refer to. In most cases where the pension is a large part of the retirement income, the prospective pensioner should indeed keep the pension. As I said, there are many factors which must be considered, including IRR, including the size of the pension relative to the overall retirement portfolio, the anticipated expenses, and the prospective p...
by Frugal Al
Tue May 31, 2016 7:58 am
Forum: Personal Investments
Topic: To take a pension distribution or not????
Replies: 11
Views: 1716

Re: To take a pension distribution or not????

If she took the $29k lump sum and turned around and spent it immediately on a deferred annuity that would start paying her in 19 years, it would pay only $325/month. The $513/mo offer in 19 years would appear to be a much better deal. Why would she do that? That's tantamount to buying water in the middle of a drought--not a good deal unless you really need water, and she doesn't. I know you're trying to show a price comparison, but it's a poor one. This comparison only works well if the purchase is imminent. She can buy an annuity anytime. In most situations, one would want to keep the pension rather than accepting the buyout. Would Verizon be offering this if it were a great deal for the former employee and a bad deal for Verizon? Compani...
by Frugal Al
Mon May 30, 2016 6:17 am
Forum: Personal Consumer Issues
Topic: When to get first car service done
Replies: 70
Views: 13908

Re: When to get first car service done

Thanks folks. I did not know that I could check the Oil level on my dashboard. You can't on a Honda, nor can you on most other vehicles. Don't confuse the remaining oil life with the oil level. The MM does not replace the necessity of manually checking your oil level--one of its short comings in my opinion. Honda and most other auto manufacturers still recommend manually checking the oil level with every fuel fill-up. Although there is a low pressure warning light to alert the driver to major damage about to be done, that is not a substitute for checking the oil level manually. In fact, Honda and most manufacturers will not cover warranty issues due to oil starvation caused by failure to maintain adequate oil levels. This caused some big w...
by Frugal Al
Sat May 28, 2016 5:33 am
Forum: Personal Investments
Topic: Lump Sum Pension Offer
Replies: 21
Views: 3327

Re: Lump Sum Pension Offer

Shouldn't be using a single life pay rate when comparing to a lump sum option; however, any reasonable 100% joint life pay rate would still prove this to be a very rich pension. Normally with small pensions and long time horizons one can make an argument to just take the lump and be done with it--hard to do that in this instance. I'd want to make certain this is an ERISA pension with PBGC insurance, and even then there's no guarantee things can't change. If it's a Multiemployer plan, I'd take the lump sum and run.
by Frugal Al
Sun May 01, 2016 6:19 am
Forum: Investing - Theory, News & General
Topic: What's a typical pension funding % ?
Replies: 30
Views: 5860

Re: What's a typical pension funding % ?

g$$ wrote:Congress regularly tinkers with the discount rates used for pension minimum funding standards as a way to raise revenue. That's what happened with "MAP-21".
MAP-21 pension funding changes were made to assuage the effect low interest rates were having on plan sponsors. It was a bit of a stick and carrot approach to still encourage the sponsors to improve their underfunded status at a time when corporations would have had to cough up billions more in funding. Those provisions have now been extended further and PBGC premiums increased with the BBA 2015. It's hardly JUST a way to raise revenue.
by Frugal Al
Sat Apr 30, 2016 6:35 am
Forum: Personal Consumer Issues
Topic: Buying a New Car...Is it Unwise?
Replies: 68
Views: 10558

Re: Buying a New Car...Is it Unwise?

I think you've just got a case of "new car-itis." There's absolutely nothing wrong with the car you have. You've probably taken $20k to $22k of depreciation over 8 years (and this doesn't include sales tax expense). You've got relatively low mileage on the TSX and in 8 more years it will still be worth a couple thousand dollars. You've got the lowest cost ownership years ahead of you. Your needs haven't changed. You've given absolutely no reason for needing a new car. Go slap some sense into yourself.
by Frugal Al
Wed Apr 27, 2016 4:43 am
Forum: Personal Consumer Issues
Topic: CVT car transmissions
Replies: 25
Views: 4359

Re: CVT car transmissions

William4u wrote:Every Toyota Prius has a CVT, and the transmissions consistently go 300,000 miles with no problems. The Corolla will use the same tech, and likely last as long.
William, you're not paying attention, you're comparing apples and oranges :oops: (see above post). The Prius doesn't use a steel belt/chain with a conical pulley system utilized by virtually all conventional CVT transmissions today. It uses what they call an eCVT as part of their Hybrid Synergy Drive system, not to be confused with Subaru's old ECVT in the Justy, which did use a conical system.

I could be wrong, but I'd be shocked if we see today's conventional CVT's going 300k miles without some major work.
by Frugal Al
Tue Apr 26, 2016 3:31 pm
Forum: Personal Consumer Issues
Topic: CVT car transmissions
Replies: 25
Views: 4359

Re: CVT car transmissions

backpacker wrote:The Prius has always had a CVT and has been among the most reliable cars out there. I would expect other Toyota CVT systems to behave similarly.
The Toyota Prius and other Toyota hybrids don't use a conventional CVT type transmission, but rather what they call an eCVT, utilizing a planetary gear set. It's very different from a regular CVT. https://www.youtube.com/watch?v=dLNDGUISTYM
by Frugal Al
Mon Apr 25, 2016 9:16 am
Forum: Investing - Theory, News & General
Topic: Deflation ahead? Nobel Prize Economics winner's thought
Replies: 84
Views: 12364

Re: Deflation ahead? Nobel Prize Economics winner's thought

I'm dumbfounded that this thread is still open: these economic discussions seldom lead to anything good. I'm also dumbfounded that Bernanke is apparently suggesting the Fed be granted more power with his proposed concept of a Money-Financed Fiscal Policy (MFFP).
by Frugal Al
Sun Apr 24, 2016 6:51 am
Forum: Personal Finance (Not Investing)
Topic: Quicken 2014 just starting asking for "Intuit ID Password"
Replies: 16
Views: 12776

Re: Quicken 2014 just starting asking for "Intuit ID Password"

abuss368 wrote:We stopped using Quicken many years ago and do not miss the cost or investment of time. Our financial lives are much more simple.
I'm certainly not trying to be a shill for Quicken and I admit there is a lot of room for its improvement; but, over the many years of its use, once set up, it has saved magnitudes more time than it took to set up. As with all online banking and personal finance aggregation programs, diligent monitoring and the use of text alets is advised. I too find the periodic request for the Intuit password off putting.
by Frugal Al
Tue Apr 19, 2016 7:44 am
Forum: Investing - Theory, News & General
Topic: Warning Signs [Economic health indicators]
Replies: 283
Views: 58077

Re: Warning Signs [Economic health indicators]

Valuethinker wrote: If you want radio news either listen to the BBC World Service or your own (excellent) NPR, if you can.
Although I enjoy some NPR programming, it is far from excellent. If I understand you correctly, Vt, you're saying one should carefully choose their biased news source. And (I'd add) they should carefully understand the nature of their bias--whether it is investment/finance/economics porn, or whatever.
by Frugal Al
Fri Apr 15, 2016 6:37 am
Forum: Personal Finance (Not Investing)
Topic: Is this a SS filing no-brainer?
Replies: 11
Views: 1696

Re: Is this a SS filing no-brainer?

Definitely agree with others suggesting you run an SS analyzer. Although SS claiming strategies like the so-called "70/62 Solution" can work, the truth is in the details. For it to work, the higher earning spouse is older and also usually the male, having a higher mortality rate. Such a scenario often worked because of the the survivor benefit provisions of SS.
by Frugal Al
Fri Apr 08, 2016 9:23 am
Forum: Investing - Theory, News & General
Topic: guaranteed 5% vs stocks?
Replies: 213
Views: 41595

Re: guaranteed 5% vs stocks?

packet wrote:It's chasing performance... but with no down side!
Every time you share data with a new financial services provider there is a potential downside through mishandling/negligence/incompetence of that data handling. I try to open as few new accounts as possible.
by Frugal Al
Tue Mar 29, 2016 7:26 am
Forum: Investing - Theory, News & General
Topic: 3% annuity costs a little more than a CPI-U adjusted one
Replies: 17
Views: 4155

Re: 3% annuity costs a little more than a CPI-U adjusted one

I think what Cruncher saying is that TIPS are a more efficient inflation hedge than the CPI-U indexed annuity. Not only that, but TIPS are not irrevocable, as is the annuity funding. Also, the U.S. Treasury offers lower risk than an insurance company, when the bad stuff hits the fan. Given those reasons, I think I'd go with the nominal annuity and supplement with TIPS. While not as convenient as the inflation indexed annuity, in my opinion the lower cost and the benefits outweigh the inconvenience.
by Frugal Al
Mon Mar 28, 2016 7:28 am
Forum: Personal Finance (Not Investing)
Topic: Deleted
Replies: 80
Views: 11115

Re: sellers want us to waive financing contingency

letsgobobby wrote:They say they want our offer because we do not want to develop the land at this time, but rather for us to enjoy the property as a single family residence to raise our family.
It's great that this is still going to work out for you, 'bobby. However, I've never understood property sellers that acted like they cared what happened to their property after they sold it. As long as I get my asking price, I wouldn't care if a buyer turned the property into a meth lab or a brothel--it's no longer my property or my concern. If I really cared, I wouldn't sell it at all.