** Retirement Checkup Request **

Have a question about your personal investments? No matter how simple or complex, you can ask it here.
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Topic Author
alaskanmom
Posts: 13
Joined: Sat Feb 10, 2024 4:56 pm

** Retirement Checkup Request **

Post by alaskanmom »

Hello everyone! New here. I'm just learning about Bogleheads and for the first time I'm actually analyzing our retirement finances. I'm .2 seconds away from getting an advisor :shock: because I'm definitely out of my league, but I went to Edward Jones and didn't love the salesman vibe...so I guess I'm still looking.

I don't have any specific questions because I'm not really sure what I need to ask, but are there any glaring issues or areas we could improve on? J is self-employed and income is inconsistent, so I'm not sure what rate % we'll be at this year, probably federal 22% (zero state taxes).

Thank you for your time and willingness to give advice!

Emergency Funds: 200K
Debt: Conventional 30 yr Fixed Mortgage @2.625%, Balance $242,703, monthly $1658 +extra principal payment of $150, matures 2050
Tax Filing Status: Married Filing Jointly
Tax rate: federal 22% (waiting for 2023 numbers, so this is my guess), zero state taxes
State of Residence: AK
Age: 40 (her), 43 (him)

Combined Percentage of Portfolio to equal 100%:
Her Vanguard Target Retirement 2050 (11.6%)
Her Fidelity Flex 500 Index Fd (0.7%)
Her Fidelity Flex US Bond Index Fd (0.2%)
Her Fidelity Flex International 0.3%)
Her Fidelity Flex Mid Cap Index Fund (0.1%)
Her Fidelity Flex Small Cap Index Fund (0.1%)
Her NVIDIA (8.5%)
Her Amazon (3.7%)
Her Alaska Airlines (0.4%)
Her Alaska Target Date Retirement 2045 Trust (1.7%)
Her International Equity Fund (2.3%)
Combined World Equity Ex-US Index (4.9%)
Combined US Small Cap Trust (4%)
Combined Russell 3000 Index (4%)
Combined S&P 500 Stock Index Fund (2.4%)
Combined Environmental,Social and Governance Fd (1.4%)
Combined Stable Value Fund (10.7%)
Combined State Street Inst Treasury Money Market (0.9%)
Combined Alaska Balanced Trust (3.6%)
Combined Alaska Long-Term Balanced Trust (28.8%)
Combined BlackRock Strategic Completion NLF (2%)
Combined Passive US Bond Index Fund (7.7%)

Current Monthly Expenses
Mortgage=$1,809
Car Insurance=$107
City Utilities=$156
Trash=$63
Internet/Cell=$236
Life Insurance J =$39
Life insurance S =$47
TV: $62
Electric=$645
Groceries=$600
Gas=$320
Propane=$150
Kids Doctor=$45
Kids Sports=$100
Total: $4379

Investments break-down:
Her Vanguard SIMPLE IRA
Contribution: 16,000/year
Vanguard Target Retirement 2050 VFIFX (0.08)=$87,500
Total: $87,500 (11%)

Her FidelityGo Roth
Contribution: 7,000/year
Fidelity Flex 500 Index Fd FDFIX=$5,414 (.7%)
Fidelity Flex US Bond Index Fd FIBUX=$1,447 (.2%)
Fidelity Flex International FITFX=$2,578 (.3%)
Fidelity Flex Mid Cap Index Fund FLAPX=$483 (.1%)
Fidelity Flex Small Cap Index Fund FLXSX=$419 (<.1%)
Cash in Money Market=$52 (<.1%)
Total: $10,395

Her eTrade Brokerage
NVIDIA NVDA=$64,116 (8.5%)
Amazon AMZN=$27,552 (3.7%)
Alaska Airlines ALK=$2,984 (.4%)
23andMe ME=$15 (<.1%)
Beyond Meat BYND=$234 (<.1%)
Total: $95,885

Her State of AK TERS Tier III Defined Contribution
Contribution: $0/year
World Equity Ex-US Index (0.07)=$23,027
International Equity Fund (0.38)=$17,622
US Small Cap Trust (0.6)=$21,383
Russell 3000 Index (0.02)=$21,039
S&P 500 Stock Index Fund (0.01)=$11,306
Environmental,Social and Governance Fd (0.05)=$5,691
Stable Value Fund (0.19)=$13,520
State Street Inst Treasury (0.12)=$4
Alaska Balanced Trust (0.08)=$6,776
Alaska Long-Term Balanced Trust (0.09)=$5,469
BlackRock Strategic Completion NLF (0.11)=$3,938
Passive US Bond Index Fund (0.04)=$6,671
Total: $136,451

His 401a Supplemental Annuity
Contribution/Match: Contribution 6.13%, employer maximum match before tax
Alaska Long Term Balance Trust (.09)
Total: $12,463

His 457 Deferred Compensation
Alaska Long-Term Balanced Trust (.09)
Contribution/Match:includes Roth 457, Contribution is $60 before tax+$60 Roth 457/pay period (every 2 weeks), but he can contribute up to $22,500 in this account each year, no employer contribution allowed for this type of account
Total: $192,601

His PERS Tier IV Defined Contribution
Contribution/Match: all before tax, 8% contribution mandatory, employer matches up to 5% (maximum)
Russell 3000 Index (.92)=$9,145
S&P 500 Stock Index Fund (.01)=$6,865
Environmental, Social and Governance Fd (.05)=$4,584
US Small Cap Trust (.6)=$9,052
World Equity Ex-US Index (.07)=$13,494
Passive U.S. Bond Index Fund (.04)=$51,445
Stable Value Fund (.19)=$67,212
State Street Inst Treasury Money Market (.12)=$6,736
Alaska Balanced Trust (.08)=$20,262
Alaska Long-Term Balanced Trust (.09)=$18,087
BlackRock Strategic Completion NL F (.11)=$11,113
Total: $218,002
Last edited by alaskanmom on Mon Feb 12, 2024 4:02 pm, edited 6 times in total.
inforapound
Posts: 38
Joined: Mon Jun 21, 2021 8:18 am

Re: ** Retirement Checkup Request **

Post by inforapound »

Welcome to the forum!

I was in your exact shoes a few years ago; I'd been saving for years, but didn't really know what I was doing. I found going through the Getting Started section of the wiki hugely helpful! I learned things I'd never known were even things to consider, like tax-efficient placement of funds (oops...I have BND in my taxable...). As a first step I'd recommend spending some time there! And I think your instinct to stay away from Edward Jones is spot-on!

With respect to retirement readiness, it will depend on your expenses. It doesn't look like you listed them, so I can't really comment on that. As starting point, if you have 25x-33x of your annual expenses saved, you're probably in pretty good shape!

This is a wonderful forum and I'm sure you'll get lots of great advice from people more knowledgeable than me!
BHNewbie
Posts: 26
Joined: Sun Feb 11, 2024 10:01 am

Re: ** Retirement Checkup Request **

Post by BHNewbie »

alaskanmom wrote: Sun Feb 11, 2024 10:13 pm Hello everyone! New here. I'm just learning about Bogleheads and for the first time I'm actually analyzing our retirement finances. I'm .2 seconds away from getting an advisor :shock: because I'm definitely out of my league, but I went to Edward Jones and didn't love the salesman vibe...so I guess I'm still looking.

I don't have any specific questions because I'm not really sure what I need to ask, but are there any glaring issues or areas we could improve on? J is self-employed and income is inconsistent, so I'm not sure what rate % we'll be at this year, probably federal 22% (zero state taxes).

Thank you for your time and willingness to give advice!

https://docs.google.com/spreadsheets/d/ ... sp=sharing
Welcome AK Ma,

I didn’t even look at your investments, as I would start with expenses first, as you can’t really assess or make any meaningful financial decisions without understanding them thoroughly. Is the expenses listed actually back tested (based on historical experience), and how do you anticipate them changing over time, realistically? Maybe I missed it, but I don’t see transportation expenses, home maintenance, any type of insurance including home, auto, umbrella, life, etc. No regular savings (“expense”) for college, if applicable. Do you have any pet expenses? How about grooming & clothes (haircuts, nails, products)? I would suggest you start there, in my opinion, as it’s just as important as how much your net worth is, and one impacts the other in terms of retirement readiness. We tracked for several months, which turned into a couple of years and, needless to say, it opens your eyes to how much one lever controls the next. Good luck!!
Last edited by BHNewbie on Mon Feb 12, 2024 7:28 am, edited 1 time in total.
User avatar
Watty
Posts: 28688
Joined: Wed Oct 10, 2007 3:55 pm

Re: ** Retirement Checkup Request **

Post by Watty »

Good call on not liking Edward Jones.

There is a suggested format for asking portfolio questions and you will get better responses if you post your information using that format as a guideline, but you do not need to follow it exactly.

viewtopic.php?t=6212

Most people, including myself, will not click on a link to see your information because even though it looks like it is going to Google there are ways to spoof and go to other malicious websites just like a how you should never click on a link in an email even if it looks OK.
BHNewbie
Posts: 26
Joined: Sun Feb 11, 2024 10:01 am

Re: ** Retirement Checkup Request **

Post by BHNewbie »

Watty wrote: Mon Feb 12, 2024 7:27 am Good call on not liking Edward Jones.

There is a suggested format for asking portfolio questions and you will get better responses if you post your information using that format as a guideline, but you do not need to follow it exactly.

viewtopic.php?t=6212

Most people, including myself, will not click on a link to see your information because even though it looks like it is going to Google there are ways to spoof and go to other malicious websites just like a how you should never click on a link in an email even if it looks OK.
Good point, Watty! I’m now a bit hesitant to click on your link (should I be :shock: :D )? JJ, good advice…
Last edited by BHNewbie on Mon Feb 12, 2024 7:59 am, edited 1 time in total.
student
Posts: 10650
Joined: Fri Apr 03, 2015 6:58 am

Re: ** Retirement Checkup Request **

Post by student »

BHNewbie wrote: Mon Feb 12, 2024 7:30 am
Watty wrote: Mon Feb 12, 2024 7:27 am Good call on not liking Edward Jones.

There is a suggested format for asking portfolio questions and you will get better responses if you post your information using that format as a guideline, but you do not need to follow it exactly.

viewtopic.php?t=6212

Most people, including myself, will not click on a link to see your information because even though it looks like it is going to Google there are ways to spoof and go to other malicious websites just like a how you should never click on a link in an email even if it looks OK.
Good point, Watty! I’m now a bit hesitant to click on your link (should I be)?
I clicked on the link. It is a google sheet of investments.
User avatar
Wiggums
Posts: 6978
Joined: Thu Jan 31, 2019 7:02 am

Re: ** Retirement Checkup Request **

Post by Wiggums »

alaskanmom wrote: Sun Feb 11, 2024 10:13 pm Hello everyone! New here. I'm just learning about Bogleheads and for the first time I'm actually analyzing our retirement finances. I'm .2 seconds away from getting an advisor :shock: because I'm definitely out of my league, but I went to Edward Jones and didn't love the salesman vibe...so I guess I'm still looking.

I don't have any specific questions because I'm not really sure what I need to ask, but are there any glaring issues or areas we could improve on? J is self-employed and income is inconsistent, so I'm not sure what rate % we'll be at this year, probably federal 22% (zero state taxes).

Thank you for your time and willingness to give advice!

https://docs.google.com/spreadsheets/d/ ... sp=sharing
The asking portfolio questions template is the best thing to use because it is easily viewable on mobile devices, and all the information is in one place in a format we are familiar with.

viewtopic.php?t=6212
Last edited by Wiggums on Mon Feb 12, 2024 8:15 am, edited 3 times in total.
"I started with nothing and I still have most of it left."
terran
Posts: 2801
Joined: Sat Jan 10, 2015 9:50 pm

Re: ** Retirement Checkup Request **

Post by terran »

student wrote: Mon Feb 12, 2024 7:43 am I clicked on the link. It is a google sheet of investments.
Same.

And I agree with others that the total liquid net worth f $966,648.57 doesn't mean a whole lot in terms of retirement readiness without a firm understanding of expenses, other income sources, and age.
Topic Author
alaskanmom
Posts: 13
Joined: Sat Feb 10, 2024 4:56 pm

Re: ** Retirement Checkup Request **

Post by alaskanmom »

inforapound wrote: Mon Feb 12, 2024 7:02 am Welcome to the forum!

I was in your exact shoes a few years ago; I'd been saving for years, but didn't really know what I was doing. I found going through the Getting Started section of the wiki hugely helpful! I learned things I'd never known were even things to consider, like tax-efficient placement of funds (oops...I have BND in my taxable...). As a first step I'd recommend spending some time there! And I think your instinct to stay away from Edward Jones is spot-on!

With respect to retirement readiness, it will depend on your expenses. It doesn't look like you listed them, so I can't really comment on that. As starting point, if you have 25x-33x of your annual expenses saved, you're probably in pretty good shape!

This is a wonderful forum and I'm sure you'll get lots of great advice from people more knowledgeable than me!
Thank you, I will! I listed Expenses in the last tab on the bottom of the sheet. Appreciate your help!
Topic Author
alaskanmom
Posts: 13
Joined: Sat Feb 10, 2024 4:56 pm

Re: ** Retirement Checkup Request **

Post by alaskanmom »

Welcome AK Ma,

I didn’t even look at your investments, as I would start with expenses first, as you can’t really assess or make any meaningful financial decisions without understanding them thoroughly. Is the expenses listed actually back tested (based on historical experience), and how do you anticipate them changing over time, realistically? Maybe I missed it, but I don’t see transportation expenses, home maintenance, any type of insurance including home, auto, umbrella, life, etc. No regular savings (“expense”) for college, if applicable. Do you have any pet expenses? How about grooming & clothes (haircuts, nails, products)? I would suggest you start there, in my opinion, as it’s just as important as how much your net worth is, and one impacts the other in terms of retirement readiness. We tracked for several months, which turned into a couple of years and, needless to say, it opens your eyes to how much one lever controls the next. Good luck!!
Thank you, for right now the ones I listed in the expenses tab are what we've paid for the last year or so (gas, car & life insurance are on there), but I will certainly have to update with the non-regular expenses like home maintenance. Thank you for your help and for the advice about keeping track in the future!
Topic Author
alaskanmom
Posts: 13
Joined: Sat Feb 10, 2024 4:56 pm

Re: ** Retirement Checkup Request **

Post by alaskanmom »

Watty wrote: Mon Feb 12, 2024 7:27 am Good call on not liking Edward Jones.

There is a suggested format for asking portfolio questions and you will get better responses if you post your information using that format as a guideline, but you do not need to follow it exactly.

viewtopic.php?t=6212

Most people, including myself, will not click on a link to see your information because even though it looks like it is going to Google there are ways to spoof and go to other malicious websites just like a how you should never click on a link in an email even if it looks OK.
Will do! Currently trying to figure out how to get the spreadsheet into text format so I don't have to retype it :)
Topic Author
alaskanmom
Posts: 13
Joined: Sat Feb 10, 2024 4:56 pm

Re: ** Retirement Checkup Request **

Post by alaskanmom »

terran wrote: Mon Feb 12, 2024 8:11 am
student wrote: Mon Feb 12, 2024 7:43 am I clicked on the link. It is a google sheet of investments.
Same.

And I agree with others that the total liquid net worth f $966,648.57 doesn't mean a whole lot in terms of retirement readiness without a firm understanding of expenses, other income sources, and age.
The spreadsheet I shared has the 3 more tabs on the bottom for his age & income/her age & income/shared monthly expenses, but I think the link only shared the combined retirement sheet. Anyway, currently working on making it follow the format in here so it's not in a link :)
vrr106
Posts: 326
Joined: Wed Feb 11, 2015 9:27 am

Re: ** Retirement Checkup Request **

Post by vrr106 »

Welcome to the forum. Do read the wikis, I think this will help you rethink your current investments - a quick glance indicates you do have quite a few individual stocks and a bunch of funds. The wisdom around here is to try and simplify to a a 3-fund portfolio, or least fewer funds than you currently have.
You have probably already seen the roller coaster that individual stocks can be since you hold NVIDIA and 23andMe - 2 extremes. Wouldn't you rather just hold VTI or a broad index fund?

As far as retirement goes - the conventional wisdom here will say you need 25X annual expenses, but that is when you have a 30 year retirement. If you plan to retire earlier, that number needs to be higher.
I don't think your expenses add up - if you spend ~$53K/year and make let's say $120K after taxes, you should be saving $67K every year. I only see "J" contributing $23K a year
User avatar
luminous
Posts: 526
Joined: Sat Dec 30, 2017 9:28 pm

Re: ** Retirement Checkup Request **

Post by luminous »

First impressions:

You need a better handle on your expenses. I see you are putting detailed monthly expenses in your spreadsheet, but honestly before you do that I'd just add up a few things: 2023 money in, 2023 taxes out, 2023 money saved. Anything left over is what you spent in 2023. Then do that again for every month going forward for a while. It can be an incredibly illuminating exercise.

Have you done any thinking about what asset allocation you'd like to have? Vanguard has a decent easy little investor quiz to help you think about it.

You have a lot of different investments. Once you determine your target asset allocadtion, I'd simplify your portfolio as much as possible towards a Three Fund Porfolio. Alternatively you could keep using the target date funds which tend to be solid options as well.

Obviously investment changes in your taxable brokerage account would trigger taxes, but I'd at least consider a few things: stop buying individual stocks. Consider selling the losers and the winners in a way that balances the capital gains and losses.

Please do update your post to not point to a Google Sheet, but instead use the standard format for asking portfolio questions that others have posted links to.
65/12/23 US stock/international stock/bonds. Bonds capped at 10x annual spending. Semi-retired as of 2022.
Topic Author
alaskanmom
Posts: 13
Joined: Sat Feb 10, 2024 4:56 pm

Re: ** Retirement Checkup Request **

Post by alaskanmom »

vrr106 wrote: Mon Feb 12, 2024 12:00 pm Welcome to the forum. Do read the wikis, I think this will help you rethink your current investments - a quick glance indicates you do have quite a few individual stocks and a bunch of funds. The wisdom around here is to try and simplify to a a 3-fund portfolio, or least fewer funds than you currently have.
You have probably already seen the roller coaster that individual stocks can be since you hold NVIDIA and 23andMe - 2 extremes. Wouldn't you rather just hold VTI or a broad index fund?

As far as retirement goes - the conventional wisdom here will say you need 25X annual expenses, but that is when you have a 30 year retirement. If you plan to retire earlier, that number needs to be higher.
I don't think your expenses add up - if you spend ~$53K/year and make let's say $120K after taxes, you should be saving $67K every year. I only see "J" contributing $23K a year
You're spot on--I don't want the etrade stocks but I feel stuck and don't know what to do.
Do you mean combined we should be contributing $67k/year or is that your recommendation just for J to be contributing?
Topic Author
alaskanmom
Posts: 13
Joined: Sat Feb 10, 2024 4:56 pm

Re: ** Retirement Checkup Request **

Post by alaskanmom »

luminous wrote: Mon Feb 12, 2024 12:59 pm First impressions:

You need a better handle on your expenses. I see you are putting detailed monthly expenses in your spreadsheet, but honestly before you do that I'd just add up a few things: 2023 money in, 2023 taxes out, 2023 money saved. Anything left over is what you spent in 2023. Then do that again for every month going forward for a while. It can be an incredibly illuminating exercise.

Have you done any thinking about what asset allocation you'd like to have? Vanguard has a decent easy little investor quiz to help you think about it.

You have a lot of different investments. Once you determine your target asset allocadtion, I'd simplify your portfolio as much as possible towards a Three Fund Porfolio. Alternatively you could keep using the target date funds which tend to be solid options as well.

Obviously investment changes in your taxable brokerage account would trigger taxes, but I'd at least consider a few things: stop buying individual stocks. Consider selling the losers and the winners in a way that balances the capital gains and losses.

Please do update your post to not point to a Google Sheet, but instead use the standard format for asking portfolio questions that others have posted links to.
Thank you! I took that quiz and I didn't understand a few of the questions--but I think I like the 60 bonds, 32 in stock, 8 international one.
vrr106
Posts: 326
Joined: Wed Feb 11, 2015 9:27 am

Re: ** Retirement Checkup Request **

Post by vrr106 »

vrr106 wrote: Mon Feb 12, 2024 12:00 pm You're spot on--I don't want the etrade stocks but I feel stuck and don't know what to do.
Do you mean combined we should be contributing $67k/year or is that your recommendation just for J to be contributing?
On the individual stocks, this forum is almost always going to suggest you sell and invest in a broad index fund/etf such as VTI.

On the contributions - it is more of an observation. $4.4K/month is about $53K expenses/year. From your google doc I estimated your annual income (after tax) to be about $120K. So really you should be contributing/saving (120-53)=$67K or thereabouts.

Another way to look at it is that Gross Income - Tax - Expenses = Savings

I feel you are underestimating your expenses, we all do this when we add up the line items, instead I would go back to your credit card and bank statements for the past 3 years or so to find our what you actually spent.
Topic Author
alaskanmom
Posts: 13
Joined: Sat Feb 10, 2024 4:56 pm

Re: ** Retirement Checkup Request **

Post by alaskanmom »

vrr106 wrote: Mon Feb 12, 2024 1:34 pm
vrr106 wrote: Mon Feb 12, 2024 12:00 pm You're spot on--I don't want the etrade stocks but I feel stuck and don't know what to do.
Do you mean combined we should be contributing $67k/year or is that your recommendation just for J to be contributing?
On the individual stocks, this forum is almost always going to suggest you sell and invest in a broad index fund/etf such as VTI.

On the contributions - it is more of an observation. $4.4K/month is about $53K expenses/year. From your google doc I estimated your annual income (after tax) to be about $120K. So really you should be contributing/saving (120-53)=$67K or thereabouts.

Another way to look at it is that Gross Income - Tax - Expenses = Savings

I feel you are underestimating your expenses, we all do this when we add up the line items, instead I would go back to your credit card and bank statements for the past 3 years or so to find our what you actually spent.
Thank you! I'll do that!
doobiedoo
Posts: 833
Joined: Fri Jul 23, 2021 1:10 pm
Location: Southern CA

Re: ** Retirement Checkup Request **

Post by doobiedoo »

alaskanmom wrote: Sun Feb 11, 2024 10:13 pm ..
Current Monthly Expenses
Mortgage=$1,809
Car Insurance=$107
City Utilities=$156
Trash=$63
Internet/Cell=$236
Life Insurance J =$39
Life insurance S =$47
TV: $62
Electric=$645
Groceries=$600
Gas=$320
Propane=$150
Kids Doctor=$45
Kids Sports=$100
Total: $4379
..
OP, maybe this will help with your expense categories.
Below is an image of my 2022 expenses. [I don't have a mortgage, so there's no line item for that.]

Things I don't see in your expenses list:
  • Real estate tax (maybe it's included in your mortgage payment)
  • Dining out
  • Clothes
  • Furniture and Appliances
  • Household [for me this is everything I spend at Home Depot, Staples, etc.]
  • Entertainment [includes concerts, theater, Netflix]
  • Donations
  • Vacations
  • Presents
  • Federal Taxes [looks like Alaska does not have a state income tax]
  • Retirement savings [401k, IRAs, SEP, etc]
Image

Note: You can make the expense categories be whatever works for your situation.
Topic Author
alaskanmom
Posts: 13
Joined: Sat Feb 10, 2024 4:56 pm

Re: ** Retirement Checkup Request **

Post by alaskanmom »

doobiedoo wrote: Tue Feb 13, 2024 3:20 am
alaskanmom wrote: Sun Feb 11, 2024 10:13 pm ..
Current Monthly Expenses
Mortgage=$1,809
Car Insurance=$107
City Utilities=$156
Trash=$63
Internet/Cell=$236
Life Insurance J =$39
Life insurance S =$47
TV: $62
Electric=$645
Groceries=$600
Gas=$320
Propane=$150
Kids Doctor=$45
Kids Sports=$100
Total: $4379
..
OP, maybe this will help with your expense categories.
Below is an image of my 2022 expenses. [I don't have a mortgage, so there's no line item for that.]

Things I don't see in your expenses list:
  • Real estate tax (maybe it's included in your mortgage payment)
  • Dining out
  • Clothes
  • Furniture and Appliances
  • Household [for me this is everything I spend at Home Depot, Staples, etc.]
  • Entertainment [includes concerts, theater, Netflix]
  • Donations
  • Vacations
  • Presents
  • Federal Taxes [looks like Alaska does not have a state income tax]
  • Retirement savings [401k, IRAs, SEP, etc]
Image

Note: You can make the expense categories be whatever works for your situation.
Thanks, it's helpful to see how other people categorize their spending. You are correct that the real estate tax (and the property tax) is built into our mortgage. Appreciate you taking the time to share your method of organizing!
AlaskaTeach
Posts: 180
Joined: Fri May 27, 2022 8:51 pm

Re: ** Retirement Checkup Request **

Post by AlaskaTeach »

Hello from above the Arctic Circle. I am super-impressed with your low, low grocery expenses, especially if that is a full month for at least three people! I was in Anchorage the other day for a teacher conference and the prices at Fred Meyer were depressingly high.

To the person who estimated income, there is also a Permandent Fund Dividend, PFD, per person, every year. The record high was $3000 per person in 2022, I think. In 2023 the amount was more like $1000 per person.

I always remind myself every year living in Alaska that when I file a federal income tax form, that is the time to claim the PFD as well.
Topic Author
alaskanmom
Posts: 13
Joined: Sat Feb 10, 2024 4:56 pm

Re: ** Retirement Checkup Request **

Post by alaskanmom »

AlaskaTeach wrote: Tue Feb 13, 2024 6:52 pm Hello from above the Arctic Circle. I am super-impressed with your low, low grocery expenses, especially if that is a full month for at least three people! I was in Anchorage the other day for a teacher conference and the prices at Fred Meyer were depressingly high.

To the person who estimated income, there is also a Permandent Fund Dividend, PFD, per person, every year. The record high was $3000 per person in 2022, I think. In 2023 the amount was more like $1000 per person.

I always remind myself every year living in Alaska that when I file a federal income tax form, that is the time to claim the PFD as well.
Hello! Over the last year we've changed our eating habits a lot and I think that impacted a huge chunk of it. A big portion of our groceries were the snack food and "extras" (like soda and cereal) that we stopped buying. Our kids apparently snack a lot less when we don't offer so much junk like we were previously doing--they are still grumpy about it but hopefully they'll understand when they're old enough to make their own grocery choices. I file for my PFD on Jan 1 and remind myself when I renew my med evac memberships 8-) thankfully I have an accountant to do my federal taxes because man they get complicated!
User avatar
luminous
Posts: 526
Joined: Sat Dec 30, 2017 9:28 pm

Re: ** Retirement Checkup Request **

Post by luminous »

alaskanmom wrote: Mon Feb 12, 2024 1:29 pm
luminous wrote: Mon Feb 12, 2024 12:59 pm First impressions:

You need a better handle on your expenses. I see you are putting detailed monthly expenses in your spreadsheet, but honestly before you do that I'd just add up a few things: 2023 money in, 2023 taxes out, 2023 money saved. Anything left over is what you spent in 2023. Then do that again for every month going forward for a while. It can be an incredibly illuminating exercise.

Have you done any thinking about what asset allocation you'd like to have? Vanguard has a decent easy little investor quiz to help you think about it.

You have a lot of different investments. Once you determine your target asset allocadtion, I'd simplify your portfolio as much as possible towards a Three Fund Porfolio. Alternatively you could keep using the target date funds which tend to be solid options as well.

Obviously investment changes in your taxable brokerage account would trigger taxes, but I'd at least consider a few things: stop buying individual stocks. Consider selling the losers and the winners in a way that balances the capital gains and losses.

Please do update your post to not point to a Google Sheet, but instead use the standard format for asking portfolio questions that others have posted links to.
Thank you! I took that quiz and I didn't understand a few of the questions--but I think I like the 60 bonds, 32 in stock, 8 international one.
That is a very conservative asset allocation for a couple in their 40s who are still working. I’d love to dig in a bit more on that. What are your financial goals? When do you want to retire?
65/12/23 US stock/international stock/bonds. Bonds capped at 10x annual spending. Semi-retired as of 2022.
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alaskanmom
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Re: ** Retirement Checkup Request **

Post by alaskanmom »

That is a very conservative asset allocation for a couple in their 40s who are still working. I’d love to dig in a bit more on that. What are your financial goals? When do you want to retire?
[/quote]

Really? What would you recommend? I'm so new at this that I have no idea what sort of asset allocation would fit us I guess. Totally open to advice or questions for us to think about.

Both of us would like to retire early enough that we can enjoy our lives, like most folks I guess (maybe 60? 65 if we're not absolutely exhausted by then?). My husband would prefer to retire tomorrow and if we could live off of our savings we would do just that. We travel once a year and I'd like to be able to keep doing that. Probably a good idea to finish paying off our mortgage, maybe move into a condo where someone else can worry about the maintenance when we're about 65. Be able to afford a nursing home when we're 75. I feel like all of our goals are kind of basic...but I don't really know if they're totally unrealistic or even achievable.
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luminous
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Re: ** Retirement Checkup Request **

Post by luminous »

Those goals sound completely achievable! Since you plan to work for 10-20 more years I would have expected an asset allocation closer to 60 or 70% stocks rather than 40%.

However! You have to ask yourself how you have reacted to major stock market downturns in the past. If you were at 70% stocks and the market crashed would you sell those stocks and go to bonds? That would be a tragic outcome (buying high and selling low). Maybe you’d be okay with market swings because you’d keep in mind that you don’t need this money for a long time and the market will go up and down a lot before you retire. Do you know how you’ve reacted in the past?
65/12/23 US stock/international stock/bonds. Bonds capped at 10x annual spending. Semi-retired as of 2022.
Topic Author
alaskanmom
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Joined: Sat Feb 10, 2024 4:56 pm

Re: ** Retirement Checkup Request **

Post by alaskanmom »

luminous wrote: Thu Feb 15, 2024 11:53 pm Those goals sound completely achievable! Since you plan to work for 10-20 more years I would have expected an asset allocation closer to 60 or 70% stocks rather than 40%.

However! You have to ask yourself how you have reacted to major stock market downturns in the past. If you were at 70% stocks and the market crashed would you sell those stocks and go to bonds? That would be a tragic outcome (buying high and selling low). Maybe you’d be okay with market swings because you’d keep in mind that you don’t need this money for a long time and the market will go up and down a lot before you retire. Do you know how you’ve reacted in the past?
I'm not really sure, but I think I would ignore the crash.
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luminous
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Re: ** Retirement Checkup Request **

Post by luminous »

alaskanmom wrote: Fri Feb 16, 2024 12:49 pm
luminous wrote: Thu Feb 15, 2024 11:53 pm Those goals sound completely achievable! Since you plan to work for 10-20 more years I would have expected an asset allocation closer to 60 or 70% stocks rather than 40%.

However! You have to ask yourself how you have reacted to major stock market downturns in the past. If you were at 70% stocks and the market crashed would you sell those stocks and go to bonds? That would be a tragic outcome (buying high and selling low). Maybe you’d be okay with market swings because you’d keep in mind that you don’t need this money for a long time and the market will go up and down a lot before you retire. Do you know how you’ve reacted in the past?
I'm not really sure, but I think I would ignore the crash.
Do you recall what you did in 2008 with the big crash then? Or even March 2020?
65/12/23 US stock/international stock/bonds. Bonds capped at 10x annual spending. Semi-retired as of 2022.
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alaskanmom
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Re: ** Retirement Checkup Request **

Post by alaskanmom »

Do you recall what you did in 2008 with the big crash then? Or even March 2020?
[/quote]

In 2008 I had just started teaching in August and had zero retirement, and in March 2020 I did nothing.
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luminous
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Re: ** Retirement Checkup Request **

Post by luminous »

Great. Then I wonder if you might be able to handle a higher proportion of stocks than 40%. Getting a firm grip on your desired asset allocation is key to taking next steps.
65/12/23 US stock/international stock/bonds. Bonds capped at 10x annual spending. Semi-retired as of 2022.
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