How do you manage cash flow for investing?

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tryingtogetahead
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How do you manage cash flow for investing?

Post by tryingtogetahead »

DW and I both max out our 401ks and Backdoor Roth IRAs every year. On top of that, after we pay all of our bills each month, we are left with about $25,000/month. Right now, we just have $25,000 automatically transfer from our joint checking account to our joint brokerage account and it's automatically invested all in FXAIX. Do others manage their money like this or is it better to do it another way (e.g., have a lesser amount automatically transferred and then dribble the rest in over a few clumps)?
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simplesimon
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Re: How do you manage cash flow for investing?

Post by simplesimon »

tryingtogetahead wrote: Thu Aug 13, 2020 3:03 pm DW and I both max out our 401ks and Backdoor Roth IRAs every year. On top of that, after we pay all of our bills each month, we are left with about $25,000/month. Right now, we just have $25,000 automatically transfer from our joint checking account to our joint brokerage account and it's automatically invested all in FXAIX. Do others manage their money like this or is it better to do it another way (e.g., have a lesser amount automatically transferred and then dribble the rest in over a few clumps)?
If you don't need the cash, there's nothing wrong with this.

What made you ask? Most people, myself included, feel the need to make things complex. Resist that urge if everything works for you.
lazynovice
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Re: How do you manage cash flow for investing?

Post by lazynovice »

Yes that is the best way to do it assuming you are at your desired AA.
dbr
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Re: How do you manage cash flow for investing?

Post by dbr »

You are dribbling in money every month now. You don't need to double-dribble that money.

But seriously, I am very curious to know what causes you to ask the question? Have there been some instances of cash flow embarrassments along the way?
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arcticpineapplecorp.
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Re: How do you manage cash flow for investing?

Post by arcticpineapplecorp. »

tryingtogetahead wrote: Thu Aug 13, 2020 3:03 pm DW and I both max out our 401ks and Backdoor Roth IRAs every year. On top of that, after we pay all of our bills each month, we are left with about $25,000/month. Right now, we just have $25,000 automatically transfer from our joint checking account to our joint brokerage account and it's automatically invested all in FXAIX. Do others manage their money like this or is it better to do it another way (e.g., have a lesser amount automatically transferred and then dribble the rest in over a few clumps)?
so the choices are:
1. invest $25,000 once a month
2. invest $6250 a week
3. invest <$6250 more often than once a week ($833.33 a day for 30 days)?

you're DCAing (dollar cost averaging) any of these ways.

You're asking is it better to invest $25,000 once a month or $6250 once a week or $833.33 a day?

Generally, it's best to invest money as soon as you get it. Why? The market tends to go up over time. So if you don't invest money and the market moves up, when you do invest it, you're buying at higher, not lower prices.

Q: When do I buy?
A: When you have the money.

Q: When do I sell?
A: When you need the money.

If you aren't investing when you have the money, you have to ask why that strategy is superior.
Last edited by arcticpineapplecorp. on Thu Aug 13, 2020 3:26 pm, edited 1 time in total.
It's "Stay" the course, not Stray the Course. Buy and Hold works. You should really try it sometime. Get a plan: www.bogleheads.org/wiki/Investment_policy_statement
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Re: How do you manage cash flow for investing?

Post by Broken Man 1999 »

arcticpineapplecorp. wrote: Thu Aug 13, 2020 3:18 pm
tryingtogetahead wrote: Thu Aug 13, 2020 3:03 pm DW and I both max out our 401ks and Backdoor Roth IRAs every year. On top of that, after we pay all of our bills each month, we are left with about $25,000/month. Right now, we just have $25,000 automatically transfer from our joint checking account to our joint brokerage account and it's automatically invested all in FXAIX. Do others manage their money like this or is it better to do it another way (e.g., have a lesser amount automatically transferred and then dribble the rest in over a few clumps)?
so the choices are:
1. invest $25,000 once a month
2. invest $6250 a week
3. invest <$6250 more often than once a week ($833.33 a day for 30 days)?

you're DCAing (dollar cost averaging) any of these ways.

You're asking is it better to invest $25,000 once a month or $6250 once a week or $833.33 a day?

Generally, it's best to invest money as soon as you get it. Why? The market tends to go up over time. So if you don't invest money and the market moves up, when you do invest it, you're buying at higher, not lower prices.

Q: When do I buy?
A: When you have the money.

Q: When do I sell?
A: When I need the money.

If you aren't investing when you have the money, you have to ask why that strategy is superior.
Plus 1!

As good an answer as you will get!

Broken Man 1999
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ruralavalon
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Re: How do you manage cash flow for investing?

Post by ruralavalon »

simplesimon wrote: Thu Aug 13, 2020 3:05 pm
tryingtogetahead wrote: Thu Aug 13, 2020 3:03 pm DW and I both max out our 401ks and Backdoor Roth IRAs every year. On top of that, after we pay all of our bills each month, we are left with about $25,000/month. Right now, we just have $25,000 automatically transfer from our joint checking account to our joint brokerage account and it's automatically invested all in FXAIX. Do others manage their money like this or is it better to do it another way (e.g., have a lesser amount automatically transferred and then dribble the rest in over a few clumps)?
If you don't need the cash, there's nothing wrong with this.

What made you ask? Most people, myself included, feel the need to make things complex. Resist that urge if everything works for you.
That's an excellent plan on my opinion.
"Everything should be as simple as it is, but not simpler." - Albert Einstein | Wiki article link:Getting Started
Notsobad
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Re: How do you manage cash flow for investing?

Post by Notsobad »

My income is more variable. So we have a small monthly automatic investment and if there is something left over at the end of the month, we invest. I periodically check the asset allocation to see if We should redirect Subsequent investments.

Your plan is great.
ScaledWheel
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Re: How do you manage cash flow for investing?

Post by ScaledWheel »

Though the amounts are smaller, we do something similar but when we receive paychecks rather than wait until the end of the month.
Topic Author
tryingtogetahead
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Re: How do you manage cash flow for investing?

Post by tryingtogetahead »

So, over time you end up with 90% or more of your NW in mutual funds? People are comfortable with that and the inherent fluctuations that result from it? I have the Mint.com app and look at it every day and see the swings. Maybe this is the problem?

Do the BH rules for being 100% index funds change at all with NW? Anotherwords, someone with $1mm and $100mm should both just have 100% VTSAX (assuming they are young enough and have the appetite for no bonds)? If you have a home mortgage, it probably doesn't make sense to own any bonds anyway because you are borrowing low interest to earn low interest, so I don't see the point. Is it ok from a BH perspective to buy individual stocks for alpha after a certain asset level is reached?
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Re: How do you manage cash flow for investing?

Post by AerialWombat »

tryingtogetahead wrote: Fri Aug 14, 2020 9:06 am So, over time you end up with 90% or more of your NW in mutual funds? People are comfortable with that and the inherent fluctuations that result from it? I have the Mint.com app and look at it every day and see the swings. Maybe this is the problem?

Do the BH rules for being 100% index funds change at all with NW? Anotherwords, someone with $1mm and $100mm should both just have 100% VTSAX (assuming they are young enough and have the appetite for no bonds)? If you have a home mortgage, it probably doesn't make sense to own any bonds anyway because you are borrowing low interest to earn low interest, so I don't see the point. Is it ok from a BH perspective to buy individual stocks for alpha after a certain asset level is reached?
Unless you choose to invest in something else, then yes, you can wind up in 100% index mutual funds. Many of the most successful investors on this forum hold only one or two funds, plow money into them monthly, and never touch it. “Fire and forget.”
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simplesimon
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Re: How do you manage cash flow for investing?

Post by simplesimon »

tryingtogetahead wrote: Fri Aug 14, 2020 9:06 am So, over time you end up with 90% or more of your NW in mutual funds? People are comfortable with that and the inherent fluctuations that result from it? I have the Mint.com app and look at it every day and see the swings. Maybe this is the problem?

Do the BH rules for being 100% index funds change at all with NW? Anotherwords, someone with $1mm and $100mm should both just have 100% VTSAX (assuming they are young enough and have the appetite for no bonds)? If you have a home mortgage, it probably doesn't make sense to own any bonds anyway because you are borrowing low interest to earn low interest, so I don't see the point. Is it ok from a BH perspective to buy individual stocks for alpha after a certain asset level is reached?
Yes I expect a big chunk of my net worth to be in mutual funds over a period of time. The other big chunk in the equity of my house.

If buying individual stocks produced alpha over the long term everybody would be doing it and we'd all be rich. If you're worried about swings in mutual funds, why would swings in stocks be less concerning?

If you have no appetite for swings in the stock market and no appetite for bonds, what are your alternatives? Given your income, you may actually have some choices that many others don't. Will they actually have better ROI over the long term? I don't know.
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ruralavalon
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Re: How do you manage cash flow for investing?

Post by ruralavalon »

My income was always extremely variable, it could change by 400-500% from month to month. Each month after setting aside enough cash for that month's expenses, the rest was added to investing with priority to my 401k and our IRAs
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dbr
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Re: How do you manage cash flow for investing?

Post by dbr »

tryingtogetahead wrote: Fri Aug 14, 2020 9:06 am So, over time you end up with 90% or more of your NW in mutual funds? People are comfortable with that and the inherent fluctuations that result from it? I have the Mint.com app and look at it every day and see the swings. Maybe this is the problem?

Do the BH rules for being 100% index funds change at all with NW? Anotherwords, someone with $1mm and $100mm should both just have 100% VTSAX (assuming they are young enough and have the appetite for no bonds)? If you have a home mortgage, it probably doesn't make sense to own any bonds anyway because you are borrowing low interest to earn low interest, so I don't see the point. Is it ok from a BH perspective to buy individual stocks for alpha after a certain asset level is reached?
I hope you realize there are bond mutual funds and even money market mutual funds? Some of them are index funds and some are not.

Also, there is no such rule as 100% index funds. There are low cost well managed mutual funds that are not index funds, not the least being all the Vanguard Treasury funds, not to mention Wellesley, Windsor, etc. Holding non-fund investments such as CDs and high yield savings is also a legitimate thing to do. The index fund thing is about staying away from the "bad" set of actively managed funds that are usually too expensive and usually don't deliver hoped for performance.

The flaw here is taking information in the form of labels or words rather than knowing what things actually are and how they work. The knowing comes from reading in the Wiki and in recommended investment books or even from reading lots of threads here.

A fundamental part of investment strategy is the allocation between stock and bond funds. You can look at Vanguard Target Retirement and Life Strategy fund of funds to see examples. Read the three fund concept: https://www.bogleheads.org/wiki/Three-fund_portfolio

Investing in individual stocks is never recommended because individual holdings (stocks or bonds except Treasuries) have uncompensated or diversifiable risk. That means a collection of similar stocks has less risk but not less return than any one of the those stocks.
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Re: How do you manage cash flow for investing?

Post by Texanbybirth »

You have a great setup. You didn't provide a whole lot of context, but from the little you've provided you and your wife will be just fine in a few years if you stick with this plan. Don't complicate things on the investing side until you're educated and ready. :beer

Have you covered yourselves on the insurance/estate planning side?

I'd stop checking Mint.com everyday. There's got to be something better you can do with those 5-10 minutes: a few push ups, some prayer or meditation?
“The strong cannot be brave. Only the weak can be brave; and yet again, in practice, only those who can be brave can be trusted, in time of doubt, to be strong.“ - GK Chesterton
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goodenyou
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Re: How do you manage cash flow for investing?

Post by goodenyou »

tryingtogetahead wrote: Fri Aug 14, 2020 9:06 am So, over time you end up with 90% or more of your NW in mutual funds? People are comfortable with that and the inherent fluctuations that result from it? I have the Mint.com app and look at it every day and see the swings. Maybe this is the problem?

Do the BH rules for being 100% index funds change at all with NW? Anotherwords, someone with $1mm and $100mm should both just have 100% VTSAX (assuming they are young enough and have the appetite for no bonds)? If you have a home mortgage, it probably doesn't make sense to own any bonds anyway because you are borrowing low interest to earn low interest, so I don't see the point. Is it ok from a BH perspective to buy individual stocks for alpha after a certain asset level is reached?
Yes. Investing in mutual funds is scalable. For higher net worth individuals, there may be a desire to branch out into alternative investments such as real estate. If you have the ability and desire to take risk, these options may appeal to you. The strategy on mortgages is that it is fixed over time, and interest rates fluctuate over time. If the interest rates go up, then you win. You get to pay back the debt with inflated dollars. If your mortgage rate (adjusted for taxes) is above at or the risk-free rate, you lose. There is a lot of debate on mortgage strategy.
"Ignorance more frequently begets confidence than does knowledge" | Do you know how to make a rain dance work? Dance until it rains.
milktoast
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Re: How do you manage cash flow for investing?

Post by milktoast »

You have the right setup.

If being all SP500 makes you nervous, you could diversify into other indices. I use the three fund (vtsax, vtiax, bnd).

If you feel overweight on stocks, divert some of that monthly investment to mortgage principal or bonds.

Beyond that, just keep going. My compensation is too variable to do it like that, but same idea applies. Set monthly budget and immediately invest excess.
ryman554
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Re: How do you manage cash flow for investing?

Post by ryman554 »

arcticpineapplecorp. wrote: Thu Aug 13, 2020 3:18 pm
Q: When do I buy?
A: When you have the money.

Q: When do I sell?
A: When you need the money.

If you aren't investing when you have the money, you have to ask why that strategy is superior.
Quibble.

No problem when you buy. Money out of sight is out of mind and you don't spend it on junk.

However, if you're selling only "when you need it", you are taking some (lots) of market risk, especially if you needed it March of this year.

1. If you didn't anticipate needing the money, it's an emergency and should come out of the emergency fund. Back fill next time you have money. And make sure you have a large enough emergency fund.
2. If you did anticipate needing the money, like say for yearly property taxes, it's not an emergency and you should budget it, and not invest it in the first place.

Yes, if you've got funds with low volatility (like short term bond funds), the above is a distinction without a difference. If you're high equity, it isn't.
lazynovice
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Re: How do you manage cash flow for investing?

Post by lazynovice »

tryingtogetahead wrote: Fri Aug 14, 2020 9:06 am So, over time you end up with 90% or more of your NW in mutual funds? People are comfortable with that and the inherent fluctuations that result from it? I have the Mint.com app and look at it every day and see the swings. Maybe this is the problem?

Do the BH rules for being 100% index funds change at all with NW? Anotherwords, someone with $1mm and $100mm should both just have 100% VTSAX (assuming they are young enough and have the appetite for no bonds)? If you have a home mortgage, it probably doesn't make sense to own any bonds anyway because you are borrowing low interest to earn low interest, so I don't see the point. Is it ok from a BH perspective to buy individual stocks for alpha after a certain asset level is reached?
First of all, Bogleheads is not a religion. You don’t have to do everything the same as everyone else. Or maybe it is like a religion and we all pick and choose the parts we adhere to. It is your money, do what you want. Some Bogleheads own individual stocks for various reasons. If you want to, you can.

More than 90% of our net worth (outside of our house) is in mutual funds/ETFs. In our case, more than 90% is in mutual funds/ETFs that are very low cost and track an index. I try to pick the broadest index available to us- so total market versus S&P 500 or total bond index. I am more comfortable in a broadly diversified index fund than in an individual stock. I have read enough to know that chasing alpha is a game you can win some of the time but not all of the time.

I do worry about how heavily weighted the overall market is to just a few companies but I don’t think the solution for me is to weight our portfolio to one or two individual stocks. The solution would be to tilt toward mid and small cap indices. I did that for a while and it was a hassle and I ended up tax loss harvesting out of it in March.
dbr
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Re: How do you manage cash flow for investing?

Post by dbr »

lazynovice wrote: Fri Aug 14, 2020 12:06 pm

First of all, Bogleheads is not a religion. You don’t have to do everything the same as everyone else. Or maybe it is like a religion and we all pick and choose the parts we adhere to. It is your money, do what you want. Some Bogleheads own individual stocks for various reasons. If you want to, you can.

More than 90% of our net worth (outside of our house) is in mutual funds/ETFs. In our case, more than 90% is in mutual funds/ETFs that are very low cost and track an index. I try to pick the broadest index available to us- so total market versus S&P 500 or total bond index. I am more comfortable in a broadly diversified index fund than in an individual stock. I have read enough to know that chasing alpha is a game you can win some of the time but not all of the time.
Absolutely right. The key point is to have a conversation about why different things could be a good idea for one person or another as may be.

But the other thing that happens is that certain things are really good ideas for a lot of people most of the time, and other things are really bad ideas most of the time for a lot of people. It is that list where a lot of consensus forms and then gets summarized as "rules." But it would be a mistake to confuse rational conclusions with rules that someone has to follow or, even worse, some kind of commandments.

The obligation on the part of readers is to spend enough time and effort to understand why good ideas are good ideas and not be lazy and look for someone to hand out a set of commandments and step-by-step instructions.
sjl333
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Re: How do you manage cash flow for investing?

Post by sjl333 »

tryingtogetahead wrote: Thu Aug 13, 2020 3:03 pm DW and I both max out our 401ks and Backdoor Roth IRAs every year. On top of that, after we pay all of our bills each month, we are left with about $25,000/month. Right now, we just have $25,000 automatically transfer from our joint checking account to our joint brokerage account and it's automatically invested all in FXAIX. Do others manage their money like this or is it better to do it another way (e.g., have a lesser amount automatically transferred and then dribble the rest in over a few clumps)?
I would also max out an HSA if you are on a HDHP. It's like 6-7k for a family
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tryingtogetahead
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Re: How do you manage cash flow for investing?

Post by tryingtogetahead »

Thanks for all of the insight. I moved a few things around in the last few days, primarily due to mortgage refis on 2 rental properties at 2.5%. NW total today is about 3.25mm. Post-refis, we will be 69% stocks/30% RE/1% cash. 72% of stocks are SP500 index mutual fund (FXAIX) and the rest (28%) is individual stocks with a large cap / FAANG tilt, which I know is already over represented in the SP500. I don’t plan to sell anything bc of taxes but plan to just add to SP500 to dilute the tilt over time. This will get me to 78/22 mutual funds/stocks in 2 years and 83/17 in 5 years, depending on how the individual stock portfolio performs relative to the index over those periods.
BestCoast123
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Re: How do you manage cash flow for investing?

Post by BestCoast123 »

tryingtogetahead wrote: Fri Aug 14, 2020 1:47 pm Thanks for all of the insight. I moved a few things around in the last few days, primarily due to mortgage refis on 2 rental properties at 2.5%. NW total today is about 3.25mm. Post-refis, we will be 69% stocks/30% RE/1% cash. 72% of stocks are SP500 index mutual fund (FXAIX) and the rest (28%) is individual stocks with a large cap / FAANG tilt, which I know is already over represented in the SP500. I don’t plan to sell anything bc of taxes but plan to just add to SP500 to dilute the tilt over time. This will get me to 78/22 mutual funds/stocks in 2 years and 83/17 in 5 years, depending on how the individual stock portfolio performs relative to the index over those periods.
Here's two "less Boglehead" options:
1. How much "income" do the rentals throw-off, i.e. is it sheltered by the depreciation / interest expense or is a good chunk treated as "passive income" and taxed at ordinary income rates. If that's the case, it may make sense to make an investment in a syndicated multi-family deal-usually takes $50k; assuming a cost segregation study and accelerate the depreciation, it could generate some paper losses in Year 1. MF still benefits from the 27.5 year depreciation schedule. For a $50k investment, you could probably expect a ~$50k loss in year 1. Obviously, in later years it will throw off a bunch of taxable income but at that point you make another investment and keep deferring the income. Losses are carried forward and can be used to offset future "passive income."
2. Assuming you have prudent reserves for emergencies and the RE, you could consider having a chunk of your taxable account at InteractiveBrokers and you could try and you could invest a small amount on Margin at like ~1.5%. Maybe try and keep the margin loan balance at $75k (3 months of free cash flow). That way you've already invested 3 months of cash flow and are always fully-invested.

That being said your current plan is great. But option 1 might be worth looking into, depending on how the rentals are impacting your taxes.
Afty
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Re: How do you manage cash flow for investing?

Post by Afty »

tryingtogetahead wrote: Fri Aug 14, 2020 1:47 pm Thanks for all of the insight. I moved a few things around in the last few days, primarily due to mortgage refis on 2 rental properties at 2.5%. NW total today is about 3.25mm. Post-refis, we will be 69% stocks/30% RE/1% cash. 72% of stocks are SP500 index mutual fund (FXAIX) and the rest (28%) is individual stocks with a large cap / FAANG tilt, which I know is already over represented in the SP500. I don’t plan to sell anything bc of taxes but plan to just add to SP500 to dilute the tilt over time. This will get me to 78/22 mutual funds/stocks in 2 years and 83/17 in 5 years, depending on how the individual stock portfolio performs relative to the index over those periods.
Are you intentionally avoiding bonds or bond funds? A typical Boglehead portfolio would include some allocation to bonds which increases as you grow older. One common rule of thumb is “age in bonds,” i.e. if you are 30 years old, you should have 30% bonds.
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tryingtogetahead
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Re: How do you manage cash flow for investing?

Post by tryingtogetahead »

BestCoast123 wrote: Fri Aug 14, 2020 4:22 pm
tryingtogetahead wrote: Fri Aug 14, 2020 1:47 pm Thanks for all of the insight. I moved a few things around in the last few days, primarily due to mortgage refis on 2 rental properties at 2.5%. NW total today is about 3.25mm. Post-refis, we will be 69% stocks/30% RE/1% cash. 72% of stocks are SP500 index mutual fund (FXAIX) and the rest (28%) is individual stocks with a large cap / FAANG tilt, which I know is already over represented in the SP500. I don’t plan to sell anything bc of taxes but plan to just add to SP500 to dilute the tilt over time. This will get me to 78/22 mutual funds/stocks in 2 years and 83/17 in 5 years, depending on how the individual stock portfolio performs relative to the index over those periods.
Here's two "less Boglehead" options:
1. How much "income" do the rentals throw-off, i.e. is it sheltered by the depreciation / interest expense or is a good chunk treated as "passive income" and taxed at ordinary income rates. If that's the case, it may make sense to make an investment in a syndicated multi-family deal-usually takes $50k; assuming a cost segregation study and accelerate the depreciation, it could generate some paper losses in Year 1. MF still benefits from the 27.5 year depreciation schedule. For a $50k investment, you could probably expect a ~$50k loss in year 1. Obviously, in later years it will throw off a bunch of taxable income but at that point you make another investment and keep deferring the income. Losses are carried forward and can be used to offset future "passive income."
2. Assuming you have prudent reserves for emergencies and the RE, you could consider having a chunk of your taxable account at InteractiveBrokers and you could try and you could invest a small amount on Margin at like ~1.5%. Maybe try and keep the margin loan balance at $75k (3 months of free cash flow). That way you've already invested 3 months of cash flow and are always fully-invested.

That being said your current plan is great. But option 1 might be worth looking into, depending on how the rentals are impacting your taxes.
The rentals do not impact my taxes at all due to write offs. I do have a 75k investment in a syndicated RE also and haven’t been able to maximize the paper losses it has created because of this.

I like your idea of accelerating 3 months of investments.
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tryingtogetahead
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Re: How do you manage cash flow for investing?

Post by tryingtogetahead »

Afty wrote: Fri Aug 14, 2020 7:21 pm
tryingtogetahead wrote: Fri Aug 14, 2020 1:47 pm Thanks for all of the insight. I moved a few things around in the last few days, primarily due to mortgage refis on 2 rental properties at 2.5%. NW total today is about 3.25mm. Post-refis, we will be 69% stocks/30% RE/1% cash. 72% of stocks are SP500 index mutual fund (FXAIX) and the rest (28%) is individual stocks with a large cap / FAANG tilt, which I know is already over represented in the SP500. I don’t plan to sell anything bc of taxes but plan to just add to SP500 to dilute the tilt over time. This will get me to 78/22 mutual funds/stocks in 2 years and 83/17 in 5 years, depending on how the individual stock portfolio performs relative to the index over those periods.
Are you intentionally avoiding bonds or bond funds? A typical Boglehead portfolio would include some allocation to bonds which increases as you grow older. One common rule of thumb is “age in bonds,” i.e. if you are 30 years old, you should have 30% bonds.
I have mortgages on two rental properties so it hasn’t made sense to me to pay interest to in return earn interest (especially at a low rate) and then pay higher taxes on the income it produces. Plus I like the JL Collins theory that investors shouldn’t switch to any bonds until later in life because our investment horizon really extends beyond the accumulation phase. Am I looking at this the wrong way?
shess
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Re: How do you manage cash flow for investing?

Post by shess »

tryingtogetahead wrote: Fri Aug 14, 2020 9:06 am Do the BH rules for being 100% index funds change at all with NW? Anotherwords, someone with $1mm and $100mm should both just have 100% VTSAX (assuming they are young enough and have the appetite for no bonds)? If you have a home mortgage, it probably doesn't make sense to own any bonds anyway because you are borrowing low interest to earn low interest, so I don't see the point. Is it ok from a BH perspective to buy individual stocks for alpha after a certain asset level is reached?
If my net worth were $1M, I'd probably be 100% VTSAX because I don't have enough to retire on and need it to grow. If my net worth were $100M, I'd be fine with 100% VTSAX because I can't imagine a scenario where I couldn't retire on that. Or to be more precise, the scenarios I can imagine all would also destroy any alternative I'd have chosen. Though if I had $100M, I'd probably peel off $5M into a bond index just because I can afford to - not like I need to grow it to $200M or anything.

Now, if I had $2M-$5M, that seems like a sweet spot where having the right asset allocation materially influences my retirement. Too little stock and I'd worry about having enough to cover healthcare and living assistance if I get into my 90's. Too much stock and I'll feel stupid if the market gives me a haircut and I end up having to go back to work.
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