Search found 2150 matches

by shess
Mon Mar 18, 2024 2:54 am
Forum: Investing - Theory, News & General
Topic: Reinvesting tax savings from munis
Replies: 3
Views: 471

Re: Reinvesting tax savings from munis

I tried googling for this but didn't come up with anything. I'm surprised to not find discussion bout the tax savings from munis being reinvested back. Seems like that would move the needle a lot over time, and make them a net benefit for people in lower tax brackets than the usual formula suggests. I'm not entirely clear what you're asking. Your after-tax return is your after-tax return, you don't get to double-dip. With a muni at 4% as you suggest in your post, you get to reinvest that 4%. To get a comparable after-tax return in the 35% federal bracket, you'd need a 6.15% bond, which bond's coupon payments would be taxed. It would not be correct to compare 4% compounded to 6.15% compounded, because you never get to keep the 6.15% in the ...
by shess
Sun Mar 17, 2024 12:36 pm
Forum: Personal Investments
Topic: Inherited IRA - Transfer in kind
Replies: 28
Views: 3058

Re: Inherited IRA - Transfer in kind

When you take an in-kind distribution from a Traditional IRA account, and certain other types of retirement accounts, I am confident that the correct answer is that the basis of the distributed assets is their value at the time of the distribution . There is a after-tax basis for the IRA as a whole, there is no basis of any kind for specific assets in the IRA or for assets distributed in kind. If you take a distribution, you have to calculate the pro-rata basis/earnings breakdown across all IRAs held by your social-security number. It does not make any difference at all which assets are the source of the distribution. But a core issue here is that the after-tax basis of a tIRA is NOT the same thing as the cost basis of a stock. They just h...
by shess
Sat Mar 16, 2024 12:43 am
Forum: Personal Finance (Not Investing)
Topic: Dealing with empty tIRA account after back door Roth IRA
Replies: 13
Views: 1678

Re: Dealing with empty tIRA account after back door Roth IRA

Some brokerages have a box you can check saying something like "100%" or "entire account". In those cases, you will often see the big transaction, dividends or something lands in the old account, and then a few days later those follow to the target account. For other accounts ... I've decided I don't care. If they want to not do the work to do it right, then I'm fully happy doing a $7 transaction to fix it. Then a $0.12 transaction to fix that. If they want to be in the business of handling tiny transactions, go for it. Or as the other poster said, just ignore it and roll it over next year. The amount of your tIRA deposit and the Roth IRA conversion are not connected in any way, other than that you obviously can't conver...
by shess
Thu Mar 14, 2024 3:39 pm
Forum: Personal Investments
Topic: Roth Conversion - Source for Paying Taxes
Replies: 26
Views: 2044

Re: Roth Conversion - Source for Paying Taxes

I'm 62 and considering traditional to Roth conversions but have a couple of questions that I can't find answers to in the Roth conversion wiki https://www.bogleheads.org/wiki/Roth_conversion or elsewhere. I understand why you'd pay taxes from savings/cash assets if you'd otherwise be penalized for the amount taken from a conversion that is used to pay the taxes. But at 62 years old are there any advantages or reasons to pay the conversion taxes from savings rather than conversion proceeds? So long as I manage the conversions the portion used to pay taxes would be taxed at a lower rate than the taxes already paid on the savings taxes would otherwise come from. Every situation is different. We're retired early, so we've been using our lower ...
by shess
Wed Mar 13, 2024 7:16 pm
Forum: Personal Investments
Topic: VFIAX,VIMAX,VSMAX vs VTSAX
Replies: 5
Views: 695

Re: VFIAX,VIMAX,VSMAX vs VTSAX

I currently have the following funds as part of my Rollover IRA: VFIAX – Vanguard 500 Index Admiral (34%), VIMAX – Vanguard Mid Cap Index Admiral (10%), and VSMAX – Vanguard Small Cap Index (4%), make up 48% of the account. Is there any benefit in rolling these funds into VTSAX – Vanguard Total Stock Market Index Fund Admiral shares instead or just leave it alone? Decades ago, I had a slice-n-dice portolio, sliced along the large/mid/small-cap and value/growth dimensions. I had theories on how it would be helpful, for instance for tax-aware asset placement. In practice, I found that it just meant that I was always uncertain about how to place additional investments, and how to rebalance. Not the mechanics, mind you, but rather that I had t...
by shess
Tue Mar 12, 2024 12:47 pm
Forum: Personal Consumer Issues
Topic: iPad Buying Question for Younger Kids
Replies: 25
Views: 1919

Re: iPad Buying Question for Younger Kids

Unless your kids are amazing, there is a high likelihood that your iPad is going to take some damage. And unless your kids are really exceptional, there is a high likelihood that the pencil is going to get lost or the charging port destroyed. I say all of this as someone who was recently having this very discussion with their kid who is wondering about using it for school work - he is in college and he agrees with my concern about getting something too high-end! You can get cheaper pointing devices, my son found some $15-$20 knock-off devices on Amazon (under "QDSYLQ" if you want to go look). Take care that you get the right iPads if you go that route. I don't think it is probably worthwhile unless you are planning to do drawing o...
by shess
Wed Mar 06, 2024 11:26 pm
Forum: Personal Finance (Not Investing)
Topic: Pay cash or take out a mortgage?
Replies: 12
Views: 1334

Re: Pay cash or take out a mortgage?

The plan is to retire in 4-5 years so would plan to pay the mortgage down by then or earlier, if we went the mortgage route. Given that, it should be straight-forward to just brute-force a spreadsheet to compare things for say a five-year paydown, four years, three years, or even just two years (it might make sense to split your stock sales across multiple years, for instance). Remember, you aren't looking to minimize taxes, you're looking to maximize your net at the end - though taxes may factor back in on how you want to discount the value of any LTCG you preserve. You don't make clear how much cashflow you can redirect to making payments. If you think you can redirect enough cash to pay it off with even payments over five years, that's ...
by shess
Tue Mar 05, 2024 11:44 pm
Forum: Personal Finance (Not Investing)
Topic: "Chunking" Charitable Contribution into Donor Advised Fund
Replies: 18
Views: 1304

Re: "Chunking" Charitable Contribution into Donor Advised Fund

I plan to donate some more appreciated mutual fund shares rather than cash. What I am wrestling with is how much? As the standard tax deduction is freakin $29,200 now, if I add $50,000 to the Donor Fund it's like I'm only getting $20,000 of "true benefit" on my taxes right? (because anyone can get $29,200 for doing nothing) Or I guess since I would then have the $10,000 capped State and Local (SALT) taxes it's like $30,000. So if I add even more, then it's like I'm taking more advantage of the tax deduction in this one year. Yes, on the one hand, once your charitable contributions have pushed you into itemization territory, it is worthwhile to add additional contributions since they'll be dollar for dollar deductible. To a point ...
by shess
Tue Mar 05, 2024 2:22 pm
Forum: Personal Finance (Not Investing)
Topic: Giving (unequal) money to adult children
Replies: 90
Views: 8258

Re: Giving (unequal) money to adult children

In my family, the "drama" was eventually discovered to be a symptom of rather serious mental illness in a family member. Of course, this is not always the case. I have been wondering about this with a young adult in our family, but I think it might just be very little modeling of any consistent concept of fair. Lots of stories there, but they threw a tantrum when the next sibling's car cost more than theirs three years later, even though the Bank of Mom and Dad gave a smaller down payment to the sibling. We are not allowed to discuss medical diagnoses on this forum, but I will respond carefully. In my opinion, the line between "entitled" behavior and actual mental illness can be rather thin. One can look like the other,...
by shess
Tue Mar 05, 2024 12:32 pm
Forum: Personal Finance (Not Investing)
Topic: Giving (unequal) money to adult children
Replies: 90
Views: 8258

Re: Giving (unequal) money to adult children

Has anyone had terrible blowback from this sort of gift, financially? From what I've seen, there are families which are full of drama, and there are families which aren't, and often the specific decisions are not what causes the drama, they are just the hooks people use to hang the drama on. So you can be super-duper objectively fair on all fronts, and still get tons of drama, and you can be completely unequal and get no drama at all, depending on the family. It is what it is at this point, so don't spend too much time tying yourself in knots about preempting it. Often when you're looking at a case like this, there is one child where $7k is really life-changing, while for the other children it's just Tuesday. It is true that giving $7k to ...
by shess
Tue Mar 05, 2024 3:32 am
Forum: Personal Finance (Not Investing)
Topic: Let go from Megacorp at 42....can I retire?
Replies: 90
Views: 22211

Re: Let go from Megacorp at 42....can I retire?

What is best direction to go here? "Can" and "Should" might have different answers. I retired early in my late 40's because I had finally reached burnout. Something I noticed after a couple years is that while I'm still young enough to go back, a couple years away has entirely removed my tolerance for the kinds of bull that work entails. It's not that I wouldn't be willing to do work, it's that I wouldn't be willing to play nice. So if I were to go back into the workforce, there would need to be a lot of personal reinvention going on in terms of "what is work" - which could be exciting, or terrifying, depending on why I were going back to work. Going back would have been easier in the first year or so, while I...
by shess
Thu Feb 29, 2024 1:14 pm
Forum: Investing - Theory, News & General
Topic: Dot.Com Era/AI Era?
Replies: 302
Views: 27389

Re: Dot.Com Era/AI Era?

I was just answering Elysium's question on why NVDA spiked in 2023, and no doubt it is because of generative AI hype and the specific time frame they mentioned was when ChatGPT was released. To me none of this is new, the hype surely was created by the marketing types after ChatGPT release. We don't know yet if scale is nearly as large as HTTP when it was released, yet it took nearly two decades since HTTP was first used in a lab and the release of first internet browser before online commerce became a thing. I think a thing that is very different about AI in general from Internet is that AI can have transformative applications which don't involve the consumer. Google or Facebook or Amazon or Walmart can use AI to make substantial changes ...
by shess
Wed Feb 28, 2024 6:17 pm
Forum: Investing - Theory, News & General
Topic: Dot.Com Era/AI Era?
Replies: 302
Views: 27389

Re: Dot.Com Era/AI Era?

I am still wondering why no one thought NVDA was this great company that will grow into the sky, just a year+ back. In Sept 2022 it traded for $121, and again in Dec 2022 it traded for $160. Why? this information that this company is so great was not known then?? what groundbreaking thing happened in AI between Jan 1 2023 and now? Still waiting for that answer. I think the core bit of nVidia's ascent isn't the AI part, AI is just an application. Their GPUs have been used for a variety of high-performance applications, and while the marquee application changes every few years, they seem to be maintaining a lead over Intel and AMD in certain areas. It's possible that their stock price will be driven by AI for a few years before that falls aw...
by shess
Wed Feb 28, 2024 3:24 pm
Forum: Investing - Theory, News & General
Topic: Dot.Com Era/AI Era?
Replies: 302
Views: 27389

Re: Dot.Com Era/AI Era?

No offense to anybody looking forward to AI, but we found that everybody smart (and that's a lot of folks in research) understands how to do high volume research. It is what it is. There are parts of it that will bend under the force of technocratic inputs, and there are parts that don't. A lot of people are already doing it. A genius I very much respect told, 30 years ago, "You have to have actual intelligence to be able to use artificial intelligence." I'd be willing to bet about a million dollars that he was right. There is a Law of the Minimum issue, here. If a problem is that it's hard to generate signal but easy to recognize signal, then AI can be very helpful. But if the problem is that there is a ton of noise and it's har...
by shess
Wed Feb 28, 2024 8:46 am
Forum: Investing - Theory, News & General
Topic: Dot.Com Era/AI Era?
Replies: 302
Views: 27389

Re: Dot.Com Era/AI Era?

Of course I don't doubt, as others have mentioned, that at the organizational level (public or private), AI/AGI will create shifts and transformation. Others have mentioned however, it will change our lives, on a personal level. What do you see it bringing that we don't already have? or more of what we already have, but more refined? Better tools to manage the information overload. 30 years ago we got mail in the post and memos in the office. TV or radio at home. Now most of us have an overflowing email intray. Plus personal email. Plus social media. Plus office chat system. Podcasts. So things like spam blockers. Fraud detectors (arms race with fraudsters using AI) AI definitely COULD be applied to that problem. But are not problems you n...
by shess
Tue Feb 27, 2024 1:57 pm
Forum: Investing - Theory, News & General
Topic: Dot.Com Era/AI Era?
Replies: 302
Views: 27389

Re: Dot.Com Era/AI Era?

I'm less skeptical than I was a few months ago about it, since some tools are helping to save me time at my job. I've started to use certain "AI" tools at my office job more often, and they've improving slowly. At first, they would only save a few seconds here and there when they could make basic predictions like a better autocorrect. More recently, I've been finding the tools able to help with slightly more complicated tasks by either making more complex predictions or helping to provide some knowledge that I need to proceed. I still have to understand, think about, and often verify, what the tools are doing, but they are helping to save minutes at a time more often. However, I don't know how generalizable this is to other types...
by shess
Tue Feb 27, 2024 12:52 am
Forum: Investing - Theory, News & General
Topic: Dot.Com Era/AI Era?
Replies: 302
Views: 27389

Re: Dot.Com Era/AI Era?

So, my question is this - is it ever really "different this time"? No. When you hear the media drumbeat on a topic, then you can be absolutely certain that you either already missed the boat, or the boat isn't at the dock, yet. Either way, you are going to get the short end of the stick. This is down to "Amara's law", which states: "We tend to overestimate the effect of a technology in the short run and underestimate the effect in the long run." The hype cycle runs way ahead of the plodding work to implement things. The dotcom hype took YEARS to build, there was sure a lot of interesting stuff happening building through the 90's, but it went rather quickly from nobody paying any attention at all to it to EVERY...
by shess
Mon Feb 26, 2024 3:23 pm
Forum: Personal Investments
Topic: Bank’s savings account vs. US treasuries
Replies: 34
Views: 4468

Re: Bank’s savings account vs. US treasuries

The question is what liquidity events you need that can't be bridged by a credit card for 30 days. On the other hand, your yield for VUSXX is 5.29% and the most recent four week rate is 5.395%. The difference is $1 per $1000, over the span of a year. In the period of quantitative easing, VUSXX was paying 0.01% while Treasuries were paying 0.03% to 0.10%, meanwhile even Ally was paying 0.50%. Now Ally is paying 4.35%, a good percentage point off the highest saving account yields and Treasuries. I think for simplicity's sake, go with a good savings account when rates are low, and switch to a money market fund when rates are higher. Over the past year and some, I've been trying to pay attention to how the VUSXX (and BIL and BILS and SGOV) rat...
by shess
Sun Feb 25, 2024 1:01 pm
Forum: Personal Investments
Topic: Bank’s savings account vs. US treasuries
Replies: 34
Views: 4468

Re: Bank’s savings account vs. US treasuries

The one downside to VUSXX versus VMFXX is that you sometimes have to think a day or two ahead to make sure you can move funds like you want to. You can sell directly-held T-bills on the secondary market, which means you probably will have funds to work with more quickly, but you may lose money on the transaction due to interest-rate movements. Shess on the last paragraph you talk about selling individual t-bills being faster to liquidate than VUSXX or VMFXX can you expand on that I’ve found t-bills especially smaller quantities harder to sell. How do you sell them typically and get the cash so quickly? I’ve been using SGOV for that sell anytime liquidity but pay a few bps for the convenience. Apologies: I was speaking to the ability to ent...
by shess
Sun Feb 25, 2024 12:37 am
Forum: Personal Investments
Topic: Bank’s savings account vs. US treasuries
Replies: 34
Views: 4468

Re: Bank’s savings account vs. US treasuries

Noob question: is there any reason to put cash into savings account vs. buying short term treasuries, other than the liquidity advantage? Treasuries pay about a percentage point more. I wondered this, too. At this point, I'm about 18 months into experimenting with T-Bills, eventually centering on a 12-rung T-Bill ladder. I rolled over my first full-year holdings in the fall (so, a 52-week T-bill matured and around the same time I purchased a replacement). I also have been doing things like parking my property-tax funds in a T-Bill maturing a few weeks before I plan to pay it, or parking some temporary holdings for 3 or 6 months while I figure out a long-term plan, that sort of thing (the sort of thing I used to do with Ally no-penalty CD a...
by shess
Sat Feb 24, 2024 11:48 am
Forum: Personal Finance (Not Investing)
Topic: resources for getting kids interested in investing / personal finance
Replies: 11
Views: 1065

Re: resources for getting kids interested in investing / personal finance

This is all helpful. Thanks. I am surprised that there aren't more really great books (or games to fit the modern age) geared towards this. I have looked! One problem is that most adult people are financially illiterate, so it's unclear what you would even do, here. Also, based on my experience with a pair of kids and my family, you should set your expectations for what they will learn VERY low. Most people who have some financial literacy didn't get there by deciding to learn about financial issues, learning about financial issues, then applying their learning. Most people can tell you a few stories about how they really started their journey after making a couple (or a bunch of) really dumb financial decisions. So sometimes the best you ...
by shess
Thu Feb 22, 2024 11:58 pm
Forum: Personal Finance (Not Investing)
Topic: Paying off credit card debt
Replies: 31
Views: 3055

Re: Paying off credit card debt

Option #1: Consolidate to a credit card that has a pause on interest on balance transfers Option #2: Debt consolidation loan Option #3: Debt settlement To some extent, this is like debating which pair of shoes is best to wear when you are escaping from a house fire. You can surely calculate an optimal answer and the exact amount of time it would save you - but in reality, as long as you avoid gross errors, the shoes don't really matter. For the most part, current credit cards with balance transfers charge an incoming fee, and have a variety of tricky requirements which cause the rate to revert in a nasty way if you don't meet the requirements. All of this can be worked around and handled, but IMHO asking someone who is in a credit hole to ...
by shess
Tue Feb 20, 2024 10:48 am
Forum: Personal Finance (Not Investing)
Topic: Roth Conversion Triggered Estimated Tax Penalty
Replies: 17
Views: 1860

Re: Roth Conversion Triggered Estimated Tax Penalty

Next time, use withholding? Not if you have after-tax money to pay the liability! Withholding tax-deferred cash from a Roth conversion makes it much less worthwhile. Convince me that it is MUCH less worthwhile. I agree less worthwhile but not with MUCH less. You either use other income that is/was taxed or generate income income from the IRA which gets taxed. It is a timing and marginal rate choice. You are going to pay the income tax on the conversion. Using other after tax dollars you have just means those dollars can't be used for XYZ or ABC. So when you do XYZ or ABC, you will need to pull the dollars to do so from your IRA. What am I missing? I absolutely agree with LotsaGray. In some cases, one may have so much money in an IRA that d...
by shess
Sun Feb 18, 2024 7:46 pm
Forum: Investing - Theory, News & General
Topic: REITS As A Supplement to Bonds in Retirement
Replies: 77
Views: 7826

Re: REITS As A Supplement to Bonds in Retirement

If you guys are going to argue that REITs are not real estate, at what point would it become real estate? It's all a continuum. Are private funds "real" real estate? How about a syndication? Individual properties? Or do you just believe that real estate is never a separate asset class from stocks/businesses? Decades ago, REITs were holding companies for real estate. Then the rules were changed, so that they could also be operating companies which own real estate. For this reason, I would no longer consider a REIT index fund to be "real estate", instead I consider it to be a collection of real-estate focussed companies. I think the comparable is whether a fund owning mining companies is really a "precious metals&quo...
by shess
Sun Feb 18, 2024 4:00 am
Forum: Personal Finance (Not Investing)
Topic: ACH pull vs paper check from online bill pay?
Replies: 40
Views: 2275

Re: ACH pull vs paper check from online bill pay?

What is the worst-case scenario of an error with the check? If they charge you late fees or something, you'll have the check-deposit image from your bank, right? Obviously there could be a mistake at any point along the way, like with entering the address or whatever, but it's not really any different from the check-mailing system we lived with for thousands of years before the Internet came along to save us all. On the debit side, sending a check is already sending a check to them, not sure how sending them a voided check is more terrifying in security terms. If you're using checks for anything, it's a problem, the info on the check is available to whoever touches the check, and they can insecurely store that info. I have a local credit-un...
by shess
Sat Feb 17, 2024 11:52 pm
Forum: Investing - Theory, News & General
Topic: REITS As A Supplement to Bonds in Retirement
Replies: 77
Views: 7826

Re: REITS As A Supplement to Bonds in Retirement

When you drill right down to the bottom, a REIT owns real estate and benefits from the appreciation of real estate and the rents charged for that real estate. Because publicly traded REITs trade on the stock market, they have higher correlation with stocks than untraded real estate, but it's still real estate at the end of the day. So unless someone believes the rental property down the street is a stock, I don't know why they believe a REIT that owns 1000 of those is a stock. Layering on leverage can let a company turn many businesses of varying kinds into a similar risk/reward bet. The different businesses may be less correlated, but saying "REITs own real estate and thus are different from stocks" is not really different from ...
by shess
Sat Feb 17, 2024 11:29 pm
Forum: Personal Investments
Topic: How to Cancel a Treasury Auction Order Online at Vanguard?
Replies: 7
Views: 990

Re: How to Cancel a Treasury Auction Order Online at Vanguard?

The bond page is on a different site, which they try to hide. Go to the relevant account, select "Transact" and "Trade bonds or CDs". Select your account again (sigh), click "CONTINUE". At the top of the popup window there is a "My orders and quotes" tab, which will list your outstanding orders for the "tradewebretail.com" site, where you can cancel things.

Well, I assume so, I'm not interested in cancelling my order to test it :-).
by shess
Tue Feb 13, 2024 12:56 am
Forum: Personal Investments
Topic: should i pay off a car at 1.9% or invest in a cd at 5.5%
Replies: 67
Views: 6284

Re: should i pay off a car at 1.9% or invest in a cd at 5.5%

Car is a 21 with 30k miles on it and I still owe $17k @ 1.9%. I can pay it off but thought it better to put in a 5.5%cd. Thoughts? I'd put the balance in a HYSA (Ally savings are 4.35%, MM 4.4%) and setup the loan to autopay from that account. Then I'd check in periodically just in case rates went wonky. Yes, you could make more on the CD. You make more by locking your money up for the term of the CD. You might find that you prefer the liquid funds. Using a high-yield cash account in this case is free money, should be something you can automate, and you can change your mind at any time. Obviously you could do something more complicated using VUSXX or a CD ladder or whatever, at the cost of managing things and possibly making a mistake at s...
by shess
Sat Feb 10, 2024 8:23 pm
Forum: Personal Finance (Not Investing)
Topic: RSUs vested in 2023, did not sell; anything needed besides W-2?
Replies: 17
Views: 2206

Re: RSUs vested in 2023, did not sell; anything needed besides W-2?

Following up: today, E*TRADE posted both a 1099-B for the sell-to-cover transactions (there were actually two for some reason, with slightly different sale price per share; lot splits I guess?) as well as the supplement detailing the adjusted cost basis information. The RSUs vested on 03/20/2023 and the sell-to-cover happened on 03/22/2023, so there was a small capital gain incurred (which exceeded the commissions and fees, for a net gain; although a small one). Unfortunately, any system which vests the shares to you then sells to cover will have capital gains or losses. The basis value is calculated on a specific metric on the date of vest, while the sale price is the actual price sold for. I don't recall the actual calculation used, it's...
by shess
Sat Feb 10, 2024 1:58 am
Forum: Investing - Theory, News & General
Topic: Meta becomes a dividend payer.
Replies: 43
Views: 5034

Re: Meta becomes a dividend payer.

There are a ton of people in here to take offense to the periodic "What do you think of my dividend-stock strategy?" posts, which is where you get the epic arguments about whether dividends are really different from capital gains. But I don't think there is all that much heat on the very concept of dividends, as far as I can tell people are OK with some companies retaining earnings and other companies paying dividends, with the caveat that some companies sometimes make the wrong decisions. So I think the the Bogleheads response to this will be mostly "Meh? Whatever."
by shess
Sun Feb 04, 2024 1:23 pm
Forum: Personal Finance (Not Investing)
Topic: RSUs vested in 2023, did not sell; anything needed besides W-2?
Replies: 17
Views: 2206

Re: RSUs vested in 2023, did not sell; anything needed besides W-2?

I rec'd RSUs for over 20 years and this was my experience as well. Transactions were on the company side, everything I needed to know showed up in my paycheck and W2. There were no transactions to report other then when I sold my vested shares. This was not the case for the RSUs I received at a major tech company. We got 1099-B forms for the sell-to-cover transactions. Well I guess this helps explain why I kept getting contradictory information when I was searching around. Assuming both of you are correct from your own experiences, I guess whether or not you get a 1099-B must come down to the stock plan administrator, the brokerage, the company, and how the plan is set up. E*TRADE says brokerage and stock plan tax documents will be availab...
by shess
Sun Feb 04, 2024 1:13 pm
Forum: Personal Finance (Not Investing)
Topic: Summer employment/internship for first year college kid
Replies: 12
Views: 1242

Re: Summer employment/internship for first year college kid

This isn’t a put in 5 applications and be done process either. This is a lot of work. My current college kiddo has gotten a lot of pushback when he mentors other college kids because it is work. Just to give you an idea my college kid sent out over 100 applications for internships (his college had it automated so it wasn’t starting from scratch with each potential) all the follow ups, all the testing, and all the follow up interviews. He scheduled it into his week. It was intense for August, September, October but then he would have a formal contract by November for the summer. Hmm. This made me want to tweak my earlier comments! Basically, I don't think it's worth going all-in to this level as a freshman. BUT, it is totally worth hitting ...
by shess
Sat Feb 03, 2024 6:43 pm
Forum: Personal Finance (Not Investing)
Topic: Summer employment/internship for first year college kid
Replies: 12
Views: 1242

Re: Summer employment/internship for first year college kid

First off, this isn't the most important thing in the world to get right. You can thrive in the job market without having had internships, and you can fail in the job market having had good internships. [Snipped stuff on the importance/value of a good internship] Sure, career-related internships are, ceterus parabis, better than sandwich-shop jobs. The key questions are: 1) If I nudge/push kid to put a lot of effort into finding a non-food-service job, is that time going to well rewarded? 20 hours of outreach for a 10% chance at a weak research job internship isn't a good risk/return profile, IMO. (And not every job helping a professor research, or being a gofer in an internship, will be all that fulfilling. Middle kid got, through a conne...
by shess
Sat Feb 03, 2024 6:08 pm
Forum: Personal Finance (Not Investing)
Topic: Summer employment/internship for first year college kid
Replies: 12
Views: 1242

Re: Summer employment/internship for first year college kid

First off, this isn't the most important thing in the world to get right. You can thrive in the job market without having had internships, and you can fail in the job market having had good internships. That said, if the lack of internship or on-topic summer placement is because the student doesn't want to bother, that is probably a leading indicator. For instance, if a student is like "I'm going to intern at Goldman Sachs or I'll just work at Starbucks", that's a problem - most students won't be working at Goldman Sachs once they graduate, after all! I've seen a number of kids with excessively high standards find themselves at the end of school not even sure they like what they've studied to do, because they weren't willing to ta...
by shess
Tue Jan 30, 2024 11:44 am
Forum: Investing - Theory, News & General
Topic: Direct Indexing Adventure
Replies: 180
Views: 36108

Re: Direct Indexing Adventure

After some reflection, I think I'll stop using the Fidelity direct indexing service shortly and liquidate most holdings after a couple of month. While the fractional shares make it so that it can match the index closely, it makes it a pain to transfer to another brokerage in the future. I estimated that it would take about $25K in transactions to buy/sell have integer amounts of each holding. My balance is small, so the cost to get out is low, as well as the potential benefits on my taxes. I could sell very small lots or holdings at a loss to simplify it for now, and wait for lower LTCG rates (or next year) to get rid of the remaining shares I still have a large amount of tax-advantaged room available. I won't have a significant amount to ...
by shess
Sun Jan 28, 2024 11:04 pm
Forum: Personal Investments
Topic: How to “Unwind” a Sliced-and-Diced Roth IRA
Replies: 47
Views: 3818

Re: How to “Unwind” a Sliced-and-Diced Roth IRA

So you are wanting to time some unknown event that will cause your current holdings to prosper while VTI does not. Or cause VTI to drop yet your current sector funds are to remain unfazed. ¯\_(ツ)_/¯ If you have a few years to hold most of the VTI, then I would think (even though it’s not going to feel good), now and let time work its’s magic. Essentially, I was hoping the Large Value and Mid/Small segments of the market (where I have tilts) would outperform large-cap growth (and hence VTI) for a period, then I could consolidate without regret. The problem is that I’ve been underweighted in large cap growth (relative to how VTI holds it) and as my bad luck has it, that’s been the hot corner of the 9-box grid for the last 20ish years. The fu...
by shess
Sun Jan 28, 2024 2:41 am
Forum: Personal Investments
Topic: Should an HSA or DAF be allocated as its own portfolio?
Replies: 9
Views: 862

Re: Should an HSA or DAF be allocated as its own portfolio?

If you didn't have the HSA, would you just not spend anything on healthcare? I expect you'd spend other dollars on healthcare. So I'm not sure why you'd treat HSA as a separate portfolio. Likewise, if you didn't have a DAF, would you not make charitable contributions? Again, I suspect that you'd still make charitable contributions, so, again, I'm not sure why you'd treat it as a separate portfolio. I'd consider both to be part of your overall asset allocation. Within that, you have a bit of tension between maximizing the tax savings and minimizing uncertainty. Either is somewhat like a Roth IRA in the sense that as long as you use the funds for the intended purpose, you have no taxes, so you want to maximize growth, which argues for an equi...
by shess
Sat Jan 27, 2024 12:29 am
Forum: Personal Investments
Topic: Conflicted about 529
Replies: 31
Views: 2709

Re: Conflicted about 529

We have ~ $110k invested in a 529 for our only daughter. She is 9Y old and very bright. I fully expect her to go to college. We continue to put in ~$15k per year into her 529. Our other tax advantaged accounts are fully funded and we make ~$650k a year with a reasonably high rate of saving in a VHCOL area I am a bit torn about when to stop investing in 529. While I want to fully fund her education no matter where she goes (private/public), I don’t want to overfund the 529. When do we stop? IMHO, the first $ put into a 529 is very worthwhile, you'll almost certainly spend it and get tax savings. But after a certain point, it's really not a slam dunk any longer. You are only here asking this question because you can easily afford to keep add...
by shess
Wed Jan 24, 2024 3:35 pm
Forum: Personal Investments
Topic: how do you invest in VUSXX?
Replies: 4
Views: 976

Re: how do you invest in VUSXX?

Doctor Rhythm wrote: Wed Jan 24, 2024 3:18 pm Edited: I just logged into Vanguard and tried to buy VUSXX. The only option was to use money in my sweep/settlement account — couldn’t use my external bank.
For me, when I click Buy on the Transact menu, I can choose between "Use my settlement fund" and "Transfer full amount ($xxxx)". The latter allows me to select one of my bank accounts. And the text at the top explicitly says you can use your settlement account or make a bank transfer.
by shess
Tue Jan 23, 2024 10:39 am
Forum: Personal Investments
Topic: hold company stock for 2 years in ESPP to save taxes before selling?
Replies: 30
Views: 2903

Re: hold company stock for 2 years in ESPP to save taxes before selling?

sco wrote: Tue Jan 23, 2024 10:23 am At multiple companies I’ve worked at, the 15% discount is reported on the W2 and so whether you realize it or not the discount is taxed as regular income the year it is received..
Yeah, it's doesn't seem ambiguous, the discount is taxed as income. Anyone who is planning to treat it as some sort of qualifying disposition resulting in capital gains would do well to go over their W2 results with a fine-toothed comb, because I don't think this is a case where you voluntarily pay extra income taxes to do it correctly. If it's in your W2, then you don't want to additionally pay capital gains taxes on that 15% discount!
by shess
Mon Jan 22, 2024 11:41 am
Forum: Personal Finance (Not Investing)
Topic: inherited non spousal ira mistake
Replies: 13
Views: 1380

Re: inherited non spousal ira mistake

You could ask the FA to look into whether it could be recast as an indirect rollover. In such cases you have 60 days to put the funds into the new account. I have no idea if it can apply to cases like this where the endpoints are not the same SSN, but that's why you ask the FA to figure it out. On the one hand, they are motivated, on the other hand, they might be idiots. For $200k, I'd probably look at the absolute tax comparison of an even 10-year withdrawal versus all in one year, and ask if the FA an make them whole. If it was $1M, it would push half or more of the amount into the 37% bracket for a single filer, which is a big hit. But $200k isn't going to be nearly that crushing, it would probably push part of the $200k into 32% or even...
by shess
Thu Jan 18, 2024 1:41 am
Forum: Personal Investments
Topic: hold company stock for 2 years in ESPP to save taxes before selling?
Replies: 30
Views: 2903

Re: hold company stock for 2 years in ESPP to save taxes before selling?

She can sell the company stock once it appears in her account. If she does, she will owe income taxes on the 15% discount (plus any gains). However, if she holds the stock for 2 years, she will owe long-term capital gains on the gains but no taxes on the 15% discount. You should verify this information. I believe that the discount is considering income when you sell the shares even if you meet the holding period. Point four of this: https://www.forbes.com/sites/brucebrumberg/2021/03/23/6-big-tax-return-errors-to-avoid-with-employee-stock-purchase-plans/?sh=4b4ecb872a9b Even if I am interpreting that wrong, there is no chance of NO taxes on the discount. You will pay taxes on all of the difference between the purchase price and the sales pr...
by shess
Tue Jan 16, 2024 2:46 pm
Forum: Personal Finance (Not Investing)
Topic: Older Parent - 529 vs Roth 401k
Replies: 7
Views: 719

Re: Older Parent - 529 vs Roth 401k

Roth is a good choice. If you have your retirement well in hand and are still working when they go to college, you can always shift cash flow from retirement funding to paying for college. If you are retired, or have changed jobs and rolled the Roth into an IRA, you can withdraw the original contributions to help pay for college (beware the 5-year rules, though). If you have reached 59.5, you have tons of options for what money to draw on. Also, retirement accounts are not reported on FAFSA, but 529 accounts are.
by shess
Tue Jan 09, 2024 10:57 am
Forum: Personal Finance (Not Investing)
Topic: Controlling income and paying off mortgage rather than taxable investing might be worthwhile for a top 20 school
Replies: 97
Views: 12759

Re: Controlling income and paying off mortgage rather than taxable investing might be worthwhile for a top 20 school

To summarize: Earning ~$300k a year, and you want other people to help fund your kids education. Many posters on this site are more than happy to talk about how their kids earned merit scholarships to help defray college costs. This is equivalent to having other people fund their kids education. The merit-aid bucket is for kids who are smart and clever, or who demonstrate other talents that the school wishes to lure to campus to enhance the experience for the other students. The financial-aid bucket is for kids who may not otherwise be able to afford attendance, again to enhance the experience for the rest of the student body. People who are able to turn their talents and skills into good-paying jobs and a large portfolio also receive bene...
by shess
Mon Jan 08, 2024 1:40 pm
Forum: Personal Finance (Not Investing)
Topic: Controlling income and paying off mortgage rather than taxable investing might be worthwhile for a top 20 school
Replies: 97
Views: 12759

Re: Controlling income and paying off mortgage rather than taxable investing might be worthwhile for a top 20 school

MMiroir wrote: Mon Jan 08, 2024 11:09 am If one has a chance to legally minimize their tuition bill, one has an ethical obligation to do so.
Just as I wasn't willing to move to a farm in the upper midwest and live paycheck to paycheck to replicate the strong upbringing my parents gave to me, I'm not willing to constrain my family's standard of living in order to minimize my tuition bill to punish colleges for overspending.
by shess
Mon Jan 08, 2024 8:51 am
Forum: Personal Finance (Not Investing)
Topic: Controlling income and paying off mortgage rather than taxable investing might be worthwhile for a top 20 school
Replies: 97
Views: 12759

Re: Controlling income and paying off mortgage rather than taxable investing might be worthwhile for a top 20 school

To take it to a more practical level I will likely pick up an extra shift tomorrow as they were short and offering a bonus to pick it up. It’s at a distant hospital an hour drive from my house. It does mean that I’ll be working 10 days in a row and if this kind of workload isn’t necessary to afford school I’d rather back off on it since work can be stressful and hard at times. I think the core question is how much of this is you, and how much of it is really about school? I retired early from a highly-paid software development position. After a couple years, I simply could no longer be arsed to do what needed to be done to re-engage with the kinds of position I held, and I also couldn't be bothered to "start over". It's not a que...
by shess
Thu Jan 04, 2024 12:07 am
Forum: Personal Finance (Not Investing)
Topic: Sell RSUs after holding a while?
Replies: 59
Views: 6077

Re: Sell RSUs after holding a while?

bling wrote: Wed Jan 03, 2024 11:35 pm however...for the anti-hold folks who would sell and pay the 15% tax without much thought. does your tune change if doing so forces you to move a marginal tax bracket? say, 24% -> 32% and most of that is from the cap gains?
https://engaging-data.com/tax-brackets/

LTCG floats above regular income, so they generally don't push your regular income to a higher marginal bracket.
by shess
Wed Jan 03, 2024 8:53 pm
Forum: Personal Investments
Topic: Backdoor Roth IRA Conversion - Done Late
Replies: 13
Views: 1910

Re: Backdoor Roth IRA Conversion - Done Late

For a few bucks in gains, don't worry about it, just convert 100%.

In general, there is no relationship between contribution and conversion, other than only being able to convert funds which were earlier contributed. If you do the actions in separate years, it doesn't cause any problems. You'll pay taxes on the conversion earnings in the year you make the conversion. I used to routinely make the prior year tIRA contribution and the current year tIRA contribution in February or so (before the 4/15 deadline), and then do a single Roth conversion. Worked fine.
by shess
Tue Jan 02, 2024 6:59 pm
Forum: Personal Finance (Not Investing)
Topic: How do you calculate how much term life you should buy?
Replies: 42
Views: 3875

Re: How do you calculate how much term life you should buy?

When we had term life insurance, we had two directions of thinking: 1) How much could we afford? At least for us, once it got below a certain price point, there was no point to further quibbling with getting the coverage precisely correct. 2) How much is REALLY appropriate. Often these things turn into a laundry-list of nice-to-have things, like college expenses, paying off the house, etc. But for many of those cases, we just couldn't really see the real utility of all of that. Our goal was to definitely make the first couple years bearable, like not having to pull the kids out of school because the remaining spouse couldn't afford to continue living in the area. But we didn't really think it was reasonable to be working out expense calcula...
by shess
Tue Jan 02, 2024 6:34 pm
Forum: Personal Consumer Issues
Topic: Concierge Doctor for Primary Care
Replies: 31
Views: 5163

Re: Conceirge Doctor for Primary Care

[Topic is now in Personal Consumer Issues - mod mkc] What are you paying? Too much. $2,000 just to see a doctor that I previously saw as a normal insurance-covered patient. I didn't bite. Moved on. If the $2k meant that I no longer had to submit through insurance or deal with co-pays, maybe. But the conceirge thing still uses insurance. You just get the privilege of paying for access when before you didn't. Hate it. The doc tried to sell this by saying you get more time with the doc, better access, etc., but all those things were just fine before. I don't know whom they're trying to attract. Maybe really sick people that like a lot of hand-holding and a side serving of therapy session along with their wellness check? [Off-topic comments re...