Search found 224 matches

by Charon
Mon Apr 05, 2021 9:59 pm
Forum: Investing - Theory, News & General
Topic: Time Value of Money vs. Variable Percentage Withdrawal (VPW)
Replies: 150
Views: 15946

Re: Time Value of Money vs. Variable Percentage Withdrawal (VPW)

I had a great-great-great grandfather live to 111 I know this is an old comment, but I couldn't help but respond... you know the thing most supercentenarians have in common? That they aren't actually supercentenarians. https://www.vox.com/2019/8/8/20758813/secrets-ultra-elderly-supercentenarians-fr...
by Charon
Tue Mar 30, 2021 10:14 am
Forum: Investing - Theory, News & General
Topic: Nate Silver sums up trying to beat the market very well
Replies: 105
Views: 14320

Re: Nate Silver sums up trying to beat the market very well

Same statement someone probably told Buffett that he wasn't Graham back in 1955. Regardless, you don't need to be Buffett to have better avg. returns than the market over significant periods of time, as my original Graham and Doddsville link describes. Bogleheads wax on about how some beat the mark...
by Charon
Tue Mar 30, 2021 10:02 am
Forum: Personal Investments
Topic: Please poke holes in our retirement plan
Replies: 14
Views: 2280

Re: Please poke holes in our retirement plan

- I/EE bonds has 200k invested in them, will buy 40k annually for 5 more years Your plan overall sounds reasonable (indeed conservative), but this part doesn't make sense to me. Why are you putting this much into I or EE bonds when you still have a mortgage? Surely the rate of return is better on p...
by Charon
Mon Mar 29, 2021 10:34 pm
Forum: Personal Finance (Not Investing)
Topic: Solo 401k contribution limit, with income exempt from self-employment tax
Replies: 5
Views: 320

Re: Solo 401k contribution limit, with income exempt from self-employment tax

Update for reference of others: our CPA said he looked it up and found that the entire net income counts towards the limit, not just the portion subject to SE tax.
by Charon
Sat Mar 27, 2021 11:06 am
Forum: Personal Finance (Not Investing)
Topic: What is an average retirement a/c worth in America ?
Replies: 228
Views: 22398

Re: What is an average retirement a/c worth in America ?

What is the size of the average of retirement assets in America for those in their mid to late 40s? According to this, $148k. https://www.synchronybank.com/blog/median-retirement-savings-by-age/ And average 401ks of 40 somethings are around $93k according to Investopedia https://www.investopedia.co...
by Charon
Sat Mar 27, 2021 11:02 am
Forum: Personal Finance (Not Investing)
Topic: What is an average retirement a/c worth in America ?
Replies: 228
Views: 22398

Re: What is an average retirement a/c worth in America ?

This is a bit dated (2016), but useful perspective: https://www.thefiscaltimes.com/Columns/2016/03/04/Retirement-Revolution-Failed-Why-401k-Isn-t-Working Nearly half of all working-age families have no money in retirement accounts at all. The median family has $5,000 saved. Even for people between t...
by Charon
Sat Mar 27, 2021 10:40 am
Forum: Personal Finance (Not Investing)
Topic: Solo 401k contribution limit, with income exempt from self-employment tax
Replies: 5
Views: 320

Re: Solo 401k contribution limit, with income exempt from self-employment tax

Lee_WSP wrote: Sat Mar 27, 2021 10:12 am I can answer the easier one. You pay yourself via a w-2, not usually worth it.
Thanks. I figured it was something like that. If it gets around the whole self-employment tax issue, I'm wondering if it could be worth it...
by Charon
Sat Mar 27, 2021 10:07 am
Forum: Personal Finance (Not Investing)
Topic: Solo 401k contribution limit, with income exempt from self-employment tax
Replies: 5
Views: 320

Solo 401k contribution limit, with income exempt from self-employment tax

I'm struggling with the absurdly complicated rules governing employer-side contributions to a solo 401(k). What I thought I understood the max to be was gross income - business expenses - 1/2 self-employment tax - employee-side contributions, all times 20%. This is what's suggested by, e.g., https:/...
by Charon
Sat Mar 20, 2021 11:28 am
Forum: Personal Consumer Issues
Topic: 50 gallon water heater questions
Replies: 70
Views: 4282

Re: 50 gallon water heater questions

Speaking of pre-warming tanks, I really want solar hot water. We don’t have the roof space for PV solar, but hot water is way more efficient and only needs a 4x8 panel or two at most.... I would strongly recommend against this. I bought a house with an existing solar hot water system, and in just a...
by Charon
Fri Mar 19, 2021 12:03 pm
Forum: Investing - Theory, News & General
Topic: Early Retirement and Absorbing the 10% Withdrawal Penalty
Replies: 46
Views: 4373

Re: Early Retirement and Absorbing the 10% Withdrawal Penalty

Regarding the 72t distribution, that leaves absolutely zero room for flexibility. Once you sign up for SEPPs you cannot get off the train without absorbing the penalty. If circumstances change or there is ever a down market, you are stuck with those SEPPs. Not sure I understand this objection in th...
by Charon
Fri Mar 19, 2021 11:43 am
Forum: Investing - Theory, News & General
Topic: Roth question
Replies: 9
Views: 851

Re: Roth question

Is there anything wrong with leaving part of my Roth contributions in cash? Purpose being to dump into market during the next crash. Investments would then be left for 20+ years. Thoughts? This is market timing, and typically recommended against. I'd certainly recommend against it given a 20+ year ...
by Charon
Fri Mar 19, 2021 11:42 am
Forum: Investing - Theory, News & General
Topic: Roth question
Replies: 9
Views: 851

Re: Roth question

Through the 457 I can’t do one time bulk payments, just deductions in my paycheck. If you have a lot of cash you want to shovel into a retirement account, you can usually jack up the contribution amount until you reach the amount you're going for. It comes out of your paycheck and you just live off...
by Charon
Sat Mar 06, 2021 11:44 am
Forum: Investing - Theory, News & General
Topic: Max solo-401k Contribution
Replies: 3
Views: 374

Re: Max solo-401k Contribution

I don't understand. Even if you think the employer-side cap ($57,000) is total, not per employer, you're well below that. As you point out, the solo 401k cap is a fraction of self-employment income, but the same is not true of the other account (nor does the 401a contribution affect your SE income).
by Charon
Wed Feb 24, 2021 11:33 pm
Forum: Personal Investments
Topic: Why Use a Target Date Fund?
Replies: 23
Views: 2044

Re: Why Use a Target Date Fund?

I'm sorta new to investing I think the first thing to learn is why people underperform the funds they hold. (It's because they switch what they're holding in non-good ways.) Most people (including most people on this site) would be best served by using a target date fund, maxing what they can put i...
by Charon
Fri Feb 19, 2021 4:55 pm
Forum: Personal Finance (Not Investing)
Topic: Where would you spend $1 million on a home in SW Florida?
Replies: 75
Views: 4919

Re: Where would you spend $1 million on a home in SW Florida?

fredflinstone wrote: Fri Feb 19, 2021 4:39 am Would you accept the offer?
No. Because Florida.

This has been another edition of Simple Answers to Simple Questions.
by Charon
Thu Feb 18, 2021 2:16 pm
Forum: Personal Finance (Not Investing)
Topic: Saving 50% of salary; what does it really mean?
Replies: 258
Views: 31684

Re: Saving 50% of salary; what does it really mean?

$40K.... which isn't much lower than the median household income in the US of $53K (averaged over 2015-2019, as the Census Bureau reports it). Many people do live on this amount, with families. Edited, because I just noticed that my google search popped up median household income for my city, and n...
by Charon
Thu Feb 18, 2021 1:53 pm
Forum: Personal Investments
Topic: Portfolio Review and Future Considerations for Retirement in 10-yr
Replies: 5
Views: 479

Re: Portfolio Review and Future Considerations for Retirement in 10-yr

Yep, can't get much advice without expenses, but looks like you have a lot of assets.

I don't understand why you haven't paid off the mortgage. At your tax rate, paying off the mortgage is like putting money into a 5.45% CD, which sounds like an amazing opportunity.
by Charon
Wed Feb 17, 2021 11:24 am
Forum: Investing - Theory, News & General
Topic: The premise of the "emergency fund" is flawed
Replies: 559
Views: 33256

Re: The premise of the "emergency fund" is flawed

You may think your cash is providing you security, when actually it’s likely just a drag on your portfolio and long-term financial success. The average is different from the value at any given point. You're apparently missing the entire risk-reward tradeoff. In addition to the point that there's a ...
by Charon
Tue Feb 16, 2021 11:50 am
Forum: Investing - Theory, News & General
Topic: How to Invest in Crypto like a Boglehead?
Replies: 187
Views: 20328

Re: How to Invest in Crypto like a Boglehead?

Impatience wrote: Mon Feb 15, 2021 6:46 pm how can I invest in crypto like a Boglehead
A Boglehead looks at the asset class before worrying about frictional costs and diversification. As a result, there is no Boglehead way to invest in crypto. (You can still invest in crypto, certainly. But not in a Boglehead way.)
by Charon
Mon Feb 15, 2021 12:22 pm
Forum: Investing - Theory, News & General
Topic: The premise of the "emergency fund" is flawed
Replies: 559
Views: 33256

Re: The premise of the "emergency fund" is flawed

My EF is insurance. I do not include it in my AA. +1 Do you include your home in your AA? Most Bogleheads will say no, although some will argue that. Do you include various insurance policies you hold, including long-term disability, in your AA? If not, then why are you including your emergency fun...
by Charon
Sat Feb 13, 2021 12:32 pm
Forum: Investing - Theory, News & General
Topic: What happens if you retire using the 4% rule and the market crashes 40%+ the next week
Replies: 113
Views: 8796

Re: What happens if you retire using the 4% rule and the market crashes 40%+ the next week

I am thinking that I would like to have about 24 months worth of withdrawals sitting in an earmarked savings account for just this purpose. Flexibility myths: https://earlyretirementnow.com/2018/05/23/the-ultimate-guide-to-safe-withdrawal-rates-part-25-more-flexibility-myths/ For those who aren't c...
by Charon
Sat Feb 13, 2021 12:29 pm
Forum: Investing - Theory, News & General
Topic: What happens if you retire using the 4% rule and the market crashes 40%+ the next week
Replies: 113
Views: 8796

Re: What happens if you retire using the 4% rule and the market crashes 40%+ the next week

IMO, calling it a rule implies that it always works. Interesting. As a scientist, I'd say things that always work (under a given set of assumptions) are typically called "laws" or "principles". Anything that's called a "rule" is a heuristic guideline, backed up by some...
by Charon
Sat Feb 13, 2021 12:24 pm
Forum: Investing - Theory, News & General
Topic: What happens if you retire using the 4% rule and the market crashes 40%+ the next week
Replies: 113
Views: 8796

Re: What happens if you retire using the 4% rule and the market crashes 40%+ the next week

I am thinking that I would like to have about 24 months worth of withdrawals sitting in an earmarked savings account for just this purpose. Flexibility myths: https://earlyretirementnow.com/2018/05/23/the-ultimate-guide-to-safe-withdrawal-rates-part-25-more-flexibility-myths/ For those who aren't c...
by Charon
Sat Feb 13, 2021 12:17 pm
Forum: Investing - Theory, News & General
Topic: What happens if you retire using the 4% rule and the market crashes 40%+ the next week
Replies: 113
Views: 8796

Re: What happens if you retire using the 4% rule and the market crashes 40%+ the next week

IMO, calling it a rule implies that it always works. Interesting. As a scientist, I'd say things that always work (under a given set of assumptions) are typically called "laws" or "principles". Anything that's called a "rule" is a heuristic guideline, backed up by some...
by Charon
Sat Feb 13, 2021 11:56 am
Forum: Investing - Theory, News & General
Topic: If you are investing in a traditional 401(k) or traditional IRA, do you have a good reason for doing this?
Replies: 156
Views: 9331

Re: If you are investing in a traditional 401(k) or traditional IRA, do you have a good reason for doing this?

You can get to a 39.6% marginal rate after 2026 under current tax law. So it is possible to overdo trad even if you are in the 37% tax bracket. Your income in retirement would have to $2,617,506 per year to break even on this. (Using 2021 bracket boundaries, but 2026 rates.) Remember, there are low...
by Charon
Sat Feb 13, 2021 11:24 am
Forum: Investing - Theory, News & General
Topic: Question about Fidelity retirement rule of thumb
Replies: 21
Views: 1985

Re: Question about Fidelity retirement rule of thumb

It's essentially the same thing. Assume gross annual earnings of $100,000. Payroll deductions of $33,000 (includes 401k, etc.) and Social Security benefit of $27,000. 1.Fidelity: $100,000 times 10 = $1,000,000.(Based on gross earnings) 2. BH's: $100,000 minus $33,000 minus $27,000 = $40,000 times 2...
by Charon
Mon Feb 08, 2021 10:17 am
Forum: Personal Consumer Issues
Topic: In price negotiations now for Subaru Crosstrek (AKA Crosstrek vs CX-30)
Replies: 46
Views: 2545

Re: Subaru Crosstrek vs Mazda CX-30

Are you going to use them on rough roads? Then Crosstrek, no question. As you say, the ground clearance is better, by about two inches. The Crosstrek is an actual SUV, and CX-30 is styled like an SUV. And no, the Crosstrek is definitely not a Jeep Wrangler, but I've driven roads with the Crosstrek w...
by Charon
Sun Feb 07, 2021 11:20 pm
Forum: Investing - Theory, News & General
Topic: Super Savers & Asset Allocation
Replies: 73
Views: 6519

Re: Super Savers & Asset Allocation

If you don't spend a lot of money hitting the 3x+ multiple isn't necessarily all that difficult. My wife and I spend ~$18K/year on everything except vacations. The 2020 federal poverty limit for two people is $17,240/year. US national average price for a one-bedroom apartment rental was about $19,5...
by Charon
Sun Feb 07, 2021 11:09 pm
Forum: Personal Investments
Topic: 457+RothIRA contribution limits and taxes
Replies: 11
Views: 707

Re: 457+RothIRA contribution limits and taxes

Even if you could put money in taxable acct, always max out your tax advantaged space first, unless the fees are too onerous: I'm curious what your reasoning behind that is in this situation. If the money is put into taxable, the principal will taxed at either 0 or 10%, depending on how much is def...
by Charon
Thu Feb 04, 2021 12:19 pm
Forum: Investing - Theory, News & General
Topic: Super Savers & Asset Allocation
Replies: 73
Views: 6519

Re: Super Savers & Asset Allocation

Searching through OP's (Ralph Furley) posts, looks like he owns a few businesses, so it is quite possible he is in a different realm than the majority of us regarding amount of salary to work with beyond covering his current annual household expenses. For him, saving household expenses in multiples...
by Charon
Thu Feb 04, 2021 12:08 pm
Forum: Investing - Theory, News & General
Topic: Super Savers & Asset Allocation
Replies: 73
Views: 6519

Re: Super Savers & Asset Allocation

Wiggums wrote: Thu Feb 04, 2021 8:23 am 5x annual savings. Only on Bogleheads :-)
But it's the only practical way to reach 150X for my FIRE, which I need because I've heard the SWR will be less than 1% in the future and it's possible that I'll live to be the oldest person in recorded history and Social Security will be cancelled!
by Charon
Thu Feb 04, 2021 11:59 am
Forum: Investing - Theory, News & General
Topic: Super Savers & Asset Allocation
Replies: 73
Views: 6519

Re: Super Savers & Asset Allocation

"A super saver is someone who saves significantly more than the average American, typically 20% or more of their income." ( https://www.fool.com/the-ascent/banks/articles/a-glimpse-into-the-mind-of-a-super-saver/ ) OP, you need to clarify that your hypothetical person is both a super saver...
by Charon
Tue Feb 02, 2021 5:36 pm
Forum: Investing - Theory, News & General
Topic: Does anyone feel like you are doing investing all wrong?
Replies: 127
Views: 10372

Re: Does anyone feel like you are doing investing all wrong?

I am wondering if finding next GME or TSLA is out of pure luck. Or, with enough research, can it be done well? 1) If it could be done via research, why would you think you could benefit from this? You'd be competing against very smart, well-educated people who would be highly compensated to do this...
by Charon
Thu Jan 28, 2021 5:09 pm
Forum: Investing - Theory, News & General
Topic: Why not 50/50?
Replies: 175
Views: 17145

Re: Why not 50/50?

If there is no perfect asset allocation, and the two largest asset classes are stocks and bonds, why not just use a 50/50 portfolio and forget about all that theoretical stuff? Because this ignores a lot of information. Information about how bonds and stocks typically work, information about your i...
by Charon
Tue Jan 26, 2021 6:11 pm
Forum: Personal Investments
Topic: Next steps for 45 yo investing newbie - your input please
Replies: 5
Views: 886

Re: Next steps for 45 yo investing newbie - your input please

Tax optimization is a consideration, but the great advantage of "set and forget" portfolios is that you take your own decisions out of the picture (and the concomitant risk of your emotions leading to poor decisions). And if you have bonds in tax-deferred and stocks in taxable, it makes re...
by Charon
Mon Jan 25, 2021 1:05 pm
Forum: Personal Finance (Not Investing)
Topic: Advice for a mid-30s humanities graduate student
Replies: 127
Views: 9926

Re: Advice for a mid-30s humanities graduate student

https://nces.ed.gov/programs/coe/pdf/coe_sbc.pdf Physical sciences $47,600. Below the median by $3K. Average unemployment rate is 3.4%...above the 2.9% median. More comparable to history majors than other STEM majors... Yes, meaningful is subjective. I should have said renumerative within their fie...
by Charon
Sun Jan 24, 2021 10:19 pm
Forum: Personal Finance (Not Investing)
Topic: Advice for a mid-30s humanities graduate student
Replies: 127
Views: 9926

Re: Advice for a mid-30s humanities graduate student

The 10x by 65 rule assumes you will also have Social Security . (When you hear Bogleheads talking about needing 25x or 33x, they're assuming no Social Security and 30+ years of retirement.) Thank you, this is super helpful information that I didn't know. If I've been living so far on an income that...
by Charon
Sun Jan 24, 2021 10:12 pm
Forum: Personal Consumer Issues
Topic: Engagement Ring
Replies: 140
Views: 7917

Re: Engagement Ring

This (not just this post... the thread) is again starting to dump on someone wanting an expensive ring, but it's worse than the fancy watch, because there is some sexism included, with all sorts of other characteristics being implied. There aren't reactions quite like this when someone is asking ab...
by Charon
Sun Jan 24, 2021 9:58 pm
Forum: Personal Consumer Issues
Topic: Engagement Ring
Replies: 140
Views: 7917

Re: Engagement Ring

Only trained jewelers are going to tell the difference between a nice moissanite and a $20k+ tiffany ring. +1 for moissanite. The only way to visually tell moissanite from diamond is that the moissanite is prettier (more fire), but even that requires having two identical-cut stones next to each oth...
by Charon
Sun Jan 24, 2021 12:31 am
Forum: Personal Finance (Not Investing)
Topic: Advice for a mid-30s humanities graduate student
Replies: 127
Views: 9926

Re: Advice for a mid-30s humanities graduate student

If you're thinking alt-ac, start laying the groundwork now. But I think you're OK. +1 to both. The academic job market is going to be apocalyptic for the foreseeable future. It's not just COVID-19 - it's the "demographic cliff" of 2025, and expected bad demographics for the following two ...
by Charon
Sat Jan 23, 2021 7:09 pm
Forum: Personal Investments
Topic: ELI5 - SEP IRA vs Solo 401k?
Replies: 6
Views: 362

Re: ELI5 - SEP IRA vs Solo 401k?

Generically you can put more into the Solo 401(k). In your situation the limitations on the employer-side contributions sound similar if not identical, but employee-side contributions are larger for the 401(k) ($19,500 this year, like a normal 401(k), as opposed to SEP limits of $6000, contributed a...
by Charon
Sat Jan 23, 2021 6:47 pm
Forum: Personal Investments
Topic: All stock too aggressive?
Replies: 24
Views: 2289

Re: All stock too aggressive?

My question - is this all equity strategy foolish? I don’t expect I’d sell in a down market, I don’t get overly emotional with money and I would welcome the lower cost of future purchases during our high earning years. What did you do in March of this year? If you were comfortable with your stock-h...
by Charon
Sat Jan 23, 2021 6:33 pm
Forum: Investing - Theory, News & General
Topic: Do you lump sum full amount into IRA at beginning of the year?
Replies: 49
Views: 2863

Re: Do you lump sum full amount into IRA at beginning of the year?

We have this same discussion every year. It's not really "lump sum" since presumably you intend to contribute to the IRA again in the future. So it's a matter of DCA annually or DCA monthly (or whatever). I'm going to have to disagree with you here, otherwise, EVERYTHING would just be DCA...
by Charon
Fri Jan 22, 2021 12:24 pm
Forum: Personal Finance (Not Investing)
Topic: Alternatives to Recommending Dave Ramsey?
Replies: 63
Views: 4660

Re: Alternatives to Recommending Dave Ramsey?

The Index Card (Olen & Pollack). If they want something quick, there is the literal index card ( https://www.npr.org/sections/alltechcon ... k-is-there ), but the book-length version is helpful with more detail.
by Charon
Fri Jan 22, 2021 12:13 pm
Forum: Investing - Theory, News & General
Topic: favorite investing books??
Replies: 30
Views: 1855

Re: favorite investing books??

This isn't quite what you're looking for, but honestly The Index Card (Olen & Pollack) is one of my favorites - precisely because it's simple and basic. That's all nearly anyone needs. Including most Bogleheads, honestly.
by Charon
Sun Jan 17, 2021 11:39 am
Forum: Personal Investments
Topic: Optimal frequency for auto-investing in taxable account
Replies: 41
Views: 2977

Re: Optimal frequency for auto-investing in taxable account

What if the sample size is the same as the population size? In other words, you sample the entire population. Then what? At the risk of digressing too much from the thread topic... this is an interesting question. In some contexts it never shows up (one can never perform all possible experiments to...
by Charon
Sun Jan 17, 2021 11:29 am
Forum: Personal Investments
Topic: Optimal frequency for auto-investing in taxable account
Replies: 41
Views: 2977

Re: Optimal frequency for auto-investing in taxable account

Note that these are descriptive stats for the sampled date range, not confidence intervals for a population. This is a point well taken. If anyone is interested in actually getting confidence intervals on the medians to see if they're really different, I recommend a non-parametric bootstrap. Edit: ...
by Charon
Sun Jan 17, 2021 12:00 am
Forum: Personal Investments
Topic: Optimal frequency for auto-investing in taxable account
Replies: 41
Views: 2977

Re: Optimal frequency for auto-investing in taxable account

To the OP's actual question, I practice "regret minimization" where I contribute to my Roth on a different day than my paydays (when I contribute to my work retirement accounts). Spreading things out a bit means I haven't put all my contributions for the month (or indeed year) in on a sing...
by Charon
Sat Jan 16, 2021 11:57 pm
Forum: Personal Investments
Topic: Optimal frequency for auto-investing in taxable account
Replies: 41
Views: 2977

Re: Optimal frequency for auto-investing in taxable account

My (limited) understanding from my statistics class many years ago coincides with this link: https://www.investopedia.com/terms/c/confidenceinterval.asp . When sampling a data set, the confidence interval becomes relevant...No? I guess one more thing to add. From a data set you can conclude that th...
by Charon
Sat Jan 16, 2021 11:43 pm
Forum: Personal Investments
Topic: Optimal frequency for auto-investing in taxable account
Replies: 41
Views: 2977

Re: Optimal frequency for auto-investing in taxable account

I don't imagine confidence intervals apply. It's just historical data on a graph, not some kind of prediction. Regards, Confidence intervals apply to any data. All experimental or observational results have confidence intervals, for which the concept is in fact more robustly defined than for predic...