Search found 607 matches

by MrJedi
Thu Apr 15, 2021 7:06 am
Forum: Personal Investments
Topic: Reverse Rollover Timing and When Backdoor Roth Eligible
Replies: 2
Views: 131

Re: Reverse Rollover Timing and When Backdoor Roth Eligible

Contributions and conversions are two separate steps. You can contribute for 2020 but a conversion this year will be for 2021, conversions are always reported for the current year, unlike contributions which can be pulled back into prior year. In your example, you can contribute for both 2020 and 20...
by MrJedi
Wed Apr 14, 2021 10:07 pm
Forum: Personal Investments
Topic: Paycheck contribution to University of California (UC) retirement account failed
Replies: 8
Views: 526

Re: Paycheck contribution to University of California (UC) retirement account failed

I see. I have not seen an example of your exact problem before, but it is possible for payroll systems to reverse a paycheck, then it could be reissued in a different way. I think the main question here is if your employer will be willing to go through the extra administrative work involved to do so...
by MrJedi
Wed Apr 14, 2021 9:53 pm
Forum: Personal Finance (Not Investing)
Topic: What's Your View Of the Fidelity 2% Cash Back Visa Credit Card
Replies: 62
Views: 5207

Re: What's Your View Of the Fidelity 2% Cash Back Visa Credit Card

mikejuss wrote: Wed Apr 14, 2021 9:37 pm Is it possible to use this kind of card to make mortgage payments without incurring fees--and thus to lower the interest one pays on the mortgage once the cash back is factored in?
That's entirely dependent on the party that is accepting the payment, not the credit card itself.
by MrJedi
Wed Apr 14, 2021 9:52 pm
Forum: Personal Investments
Topic: Paycheck contribution to University of California (UC) retirement account failed
Replies: 8
Views: 526

Re: Paycheck contribution to University of California (UC) retirement account failed

If they can't retroactively fix it, can you just increase your contributions for a paycheck or two to catch it back up?
by MrJedi
Wed Apr 14, 2021 9:27 pm
Forum: Personal Investments
Topic: Adding a bond index fund to taxable to replace HYS, and the rebalancing after
Replies: 9
Views: 636

Re: Adding a bond index fund to taxable to replace HYS, and the rebalancing after

Consider the taxable account as an extension of the rest of your accounts. Generally people put any bonds desired in the 401k/TSP/IRA accounts and then fill any remaining space and the taxable with stocks. This is because stocks are generally taxed favorably compared to bonds. Keep the whole portfol...
by MrJedi
Wed Apr 14, 2021 9:17 pm
Forum: Personal Investments
Topic: Newbie question on Roth IRA eligibility
Replies: 3
Views: 222

Re: Newbie question on Roth IRA eligibility

Another note aside from your questions. If you are approaching phase out for direct Roth IRA contributions, that means your wife is approaching the phase out for deductible IRAs, since her spouse (you) is covered by a workplace plan. You may want to watch for this too.
by MrJedi
Wed Apr 14, 2021 9:11 pm
Forum: Personal Investments
Topic: Newbie question on Roth IRA eligibility
Replies: 3
Views: 222

Re: Newbie question on Roth IRA eligibility

Look into backdoor Roth IRA for yourself if you (not your wife) don't have any pretax/deductible IRAs For your wife this strategy may not work favorably since it sounds like she has significant deducted IRAs. In her case, yes you may want to wait until you know your income. If you end up overcontrib...
by MrJedi
Wed Apr 14, 2021 7:59 pm
Forum: Personal Investments
Topic: Wash sale question
Replies: 6
Views: 274

Re: Wash sale question

Wash sales are allowed and not illegal. I wanted to clarify that since you are using phrases like "have to wait". No, you don't have to wait, there is only tax implications. Wash sales only matter if you are trying to deduct a loss. If your original shares end up as a gain and you sell, th...
by MrJedi
Wed Apr 14, 2021 6:20 pm
Forum: Investing - Theory, News & General
Topic: Mutual Fund historical data for long term and short term capital gains
Replies: 3
Views: 200

Re: Mutual Fund historical data for long term and short term capital gains

Even if this were in a taxable account and more meaningful, the capital gains distributions each year are not a consistent thing like dividends, since they are based on turnover within the fund. It's not at all like knowing a total market fund roughly paying out 1.5-2.0% in dividends each year.
by MrJedi
Wed Apr 14, 2021 3:41 pm
Forum: Investing - Theory, News & General
Topic: Index fund ETFs
Replies: 7
Views: 458

Re: Index fund ETFs

Shares of an ETF can both be created or redeemed from/into the actual stock components. When the price action moves away from the actual NAV of the ETF, authorized participants (think like market maker type institutions) will quickly arbitrage away any significant discount/premium compared to the NA...
by MrJedi
Wed Apr 14, 2021 11:08 am
Forum: Personal Finance (Not Investing)
Topic: SD question - Solo 401(k) to Roth Conversion
Replies: 5
Views: 232

Re: SD question - Solo 401(k) to Roth Conversion

Non distributable amounts cannot be taken out of the 401k while you are active in the plan (your employee deferrals/contributions). The employer amounts can be distributed out if you have any. Another option would be an in plan Roth conversion to Roth 401(k). Is that sufficient for you and/or did yo...
by MrJedi
Wed Apr 14, 2021 10:51 am
Forum: Personal Finance (Not Investing)
Topic: 2nd Roth IRA for Mega Backdoor Roth?
Replies: 2
Views: 150

Re: 2nd Roth IRA for Mega Backdoor Roth?

The only difference is that it's another account to manage. There's no difference to your taxes other than the extra forms you will receive as part of having another account.
by MrJedi
Tue Apr 13, 2021 12:55 pm
Forum: Personal Finance (Not Investing)
Topic: Gift Tax
Replies: 18
Views: 738

Re: Gift Tax

I think you may be confusing income tax and gift tax. If those are pretax IRA, they would be subject to federal income tax still. But there wouldn't be a federal gift tax on those assets unless exceeding the lifetime threshold.
by MrJedi
Tue Apr 13, 2021 11:36 am
Forum: Personal Investments
Topic: Question on taxable accounts before RMD
Replies: 3
Views: 427

Re: Question on taxable accounts before RMD

Without knowing more details, the taxable fund probably makes more sense to draw from unless reducing the future RMD helps you from taking income at a higher rate, above an IRMAA tier, etc. Also it keeps more of your dividends sheltered from tax. If you want to recoup some of the stocks you end up s...
by MrJedi
Tue Apr 13, 2021 9:04 am
Forum: Personal Investments
Topic: 401k investing in "target" fund with retirement withdrawals in mind
Replies: 9
Views: 652

Re: 401k investing in "target" fund with retirement withdrawals in mind

Typically you would withdraw so that you maintain the same AA before and after. The target fund helps you do this without any rebalancing required. If you withdraw only bonds then your AA will drift more stock heavy, thus defeating the point of the target funds. Are you trying to move toward an AA n...
by MrJedi
Tue Apr 13, 2021 7:08 am
Forum: Personal Investments
Topic: Alternative to Total Bond?
Replies: 44
Views: 4030

Re: Alternative to Total Bond?

If you hold the bond fund to duration after a NAV drop, you recover that loss. Total bond is intermediate term on average. It would be inappropriate as a short term tool.
by MrJedi
Tue Apr 13, 2021 6:05 am
Forum: Personal Finance (Not Investing)
Topic: Venmo/Cashapp/Applepay Signup Bonus?
Replies: 2
Views: 354

Re: Venmo/Cashapp/Applepay Signup Bonus?

Venmo and Cash App sometimes provide small bonuses (like $5 or $10 I think) when using a referral link (both the person referring and the person signing up).
by MrJedi
Tue Apr 13, 2021 6:02 am
Forum: Personal Investments
Topic: Question on taxable accounts before RMD
Replies: 3
Views: 427

Re: Question on taxable accounts before RMD

More info is needed. What will be your tax rate with the RMD and how much over your expenses will this be? This might be tricky to calculate once you factor in Social Security and also you need to watch out for IRMAA tiers. If you can provide more specific numbers, somebody can walk through the calc...
by MrJedi
Mon Apr 12, 2021 10:19 pm
Forum: Personal Investments
Topic: Today VTI closed +ve 214.20 +0.06 (+0.03%) but VTSAX was -ve 104.23 -0.02 (-0.02%)
Replies: 7
Views: 1244

Re: Today VTI closed +ve 214.20 +0.06 (+0.03%) but VTSAX was -ve 104.23 -0.02 (-0.02%)

If you look at the NAV of VTI, it is down 0.02% as well. That just means people are paying a slight premium on the ETF compared to NAV. Note that for ETFs, there can be premium/discount vs. NAV, whereas mutual funds always trade at NAV.

https://investor.vanguard.com/etf/profi ... rmance/vti
by MrJedi
Mon Apr 12, 2021 8:19 pm
Forum: Personal Finance (Not Investing)
Topic: Which credit unions offer deposit accounts paying more than 3% interest?
Replies: 80
Views: 7622

Re: Which credit unions offer deposit accounts paying more than 3% interest?

ChexSystems is the deposit account equivalent of a credit report. Some banks don't like someone who opens a lot of accounts even if they are responsible, as they are likely to be "churners" or someone who only signs up for a promotional offer or to game their service, without an actual &qu...
by MrJedi
Mon Apr 12, 2021 7:48 pm
Forum: Personal Finance (Not Investing)
Topic: LenderFi refinance experience -- not so good
Replies: 22
Views: 1412

Re: LenderFi refinance experience -- not so good

I had a good experience with LenderFi last year, but I will say that they probably wouldn't be great for someone not very familiar with the process. It did seem like they operate on the assumption as if you know how everything works vs. a more conventional lender who hand holds the whole way through...
by MrJedi
Mon Apr 12, 2021 11:36 am
Forum: Personal Investments
Topic: Tax Loss Harvest with VTSAX and VTIAX
Replies: 5
Views: 316

Re: Tax Loss Harvest with VTSAX and VTIAX

investingforbank wrote: Mon Apr 12, 2021 11:34 am
MrJedi wrote: Mon Apr 12, 2021 11:33 am No, since your position is no different than to begin with.
What about going from VTWAX to VTSAX + VTIAX?
That looks fine in my book.
by MrJedi
Mon Apr 12, 2021 11:33 am
Forum: Personal Investments
Topic: Tax Loss Harvest with VTSAX and VTIAX
Replies: 5
Views: 316

Re: Tax Loss Harvest with VTSAX and VTIAX

No, since your position is no different than to begin with.
by MrJedi
Mon Apr 12, 2021 10:52 am
Forum: Investing - Theory, News & General
Topic: How to Compare Active Managed fund to Passive
Replies: 19
Views: 1236

Re: How to Compare Active Managed fund to Passive

If you look at the style map, you'll see it's heavily concentrated toward large cap growth stocks. SP500 would be large cap blend. Not quite apples to apples, but if you want to remove the tilt toward growth then SP500 would do the trick I think. You may just consider going total market as well as a...
by MrJedi
Sun Apr 11, 2021 8:43 pm
Forum: Personal Investments
Topic: american funds cost basis accounting
Replies: 9
Views: 623

Re: american funds cost basis accounting

Sorry, I know this isn't part of your question, but if you have the option, I think you should reconsider average cost for specific identification. This gives you the most control over your taxes.
by MrJedi
Sun Apr 11, 2021 12:19 pm
Forum: Personal Finance (Not Investing)
Topic: I usually use electronic bank transfers to send money
Replies: 20
Views: 1380

Re: I usually use electronic bank transfers to send money

Fidelity ACH has been very fast for me. Same day posting if I initiate in the morning, otherwise early the next day.

I think ACH are more secure. In general I never use wire unless required by the payee like for a large down payment.
by MrJedi
Sat Apr 10, 2021 9:52 pm
Forum: Personal Investments
Topic: Why the general advice to have treasuries in CA HSA?
Replies: 17
Views: 1278

Re: Why the general advice to have treasuries in CA HSA?

I don't think the general recommendation is to only hold treasuries in HSA. The strategy is if you do plan to invest in treasuries, you may as well put them in the HSA where you can get some tax advantage and put your other investments in other accounts where dividends will not get taxed every year....
by MrJedi
Sat Apr 10, 2021 1:18 pm
Forum: Personal Investments
Topic: Analysis paralysis about International in Taxable Account
Replies: 26
Views: 1567

Re: Analysis paralysis about International in Taxable Account

International in taxable gets you some foreign tax credits, but international funds tend to pay more dividends (and a significant number of non-qualified dividends), which create some tax drag. These two effects largely wash each other out. Any difference left over is likely going to be very small ...
by MrJedi
Sat Apr 10, 2021 1:04 pm
Forum: Personal Investments
Topic: Analysis paralysis about International in Taxable Account
Replies: 26
Views: 1567

Re: Analysis paralysis about International in Taxable Account

International in taxable gets you some foreign tax credits, but international funds tend to pay more dividends (and a significant number of non-qualified dividends), which create some tax drag. These two effects largely wash each other out. Any difference left over is likely going to be very small o...
by MrJedi
Sat Apr 10, 2021 7:32 am
Forum: Investing - Theory, News & General
Topic: FSMAX Shows 6% Loss Today?
Replies: 39
Views: 2490

Re: FSMAX large capital gain distribution

I don't know, but I wonder if TSLA moving into the S&P500 made a big impact.
by MrJedi
Sat Apr 10, 2021 7:19 am
Forum: Personal Investments
Topic: Fidelity In Kind Rollover Issue
Replies: 31
Views: 1905

Re: Fidelity In Kind Rollover Issue

I rolled over an old 401k to an IRA last year, both at Fidelity. The 401k was invested in FXAIX, which is available in a normal retail account. I completed the rollover completely online. During that process it told me which of my funds were eligible for an in kind transfer and told me that FXAIX wa...
by MrJedi
Sat Apr 10, 2021 6:43 am
Forum: Personal Investments
Topic: Roth Ira
Replies: 11
Views: 757

Re: Back door roth

You are performing a Roth conversion. Roth conversions can result in taxable income, which is why it is asked. If you do not deduct your $7000 traditional IRA, then that conversion of up to $7000 will be nontaxable since it is post tax basis. If you had growth between the time of contribution and th...
by MrJedi
Sat Apr 10, 2021 6:34 am
Forum: Personal Finance (Not Investing)
Topic: capital gains taxes need to be paid in quarter they occur?
Replies: 6
Views: 734

Re: capital gains taxes need to be paid in quarter they occur?

Q2 to avoid potential underpayment penalty.

A workaround is to have extra tax withheld (like from a paycheck or IRA distribution) instead of paying an estimated tax. Tax withholding is always treated as timely regardless of which quarter it was withheld.
by MrJedi
Fri Apr 09, 2021 10:10 pm
Forum: Personal Finance (Not Investing)
Topic: HSA reimbursement
Replies: 10
Views: 798

Re: HSA reimbursement

If you're going to preserve the tax advantaged space and pay out of taxable up front, then the big bills are the right ones to keep and hold onto. Less paperwork to manage vs reimbursing a ton of small receipts.
by MrJedi
Thu Apr 08, 2021 1:52 pm
Forum: Personal Investments
Topic: How to structure my 401k alongside a new taxable account - VXUS in taxable or 401k?
Replies: 3
Views: 367

Re: How to structure my 401k alongside a new taxable account - VXUS in taxable or 401k?

You can get foreign tax credits by having international in taxable, increasing tax efficiency. But international funds tend to distribute more dividends than US, a significant being non-qualified as well, which decreases tax deficiency. These effects mostly wash each other out and the difference is ...
by MrJedi
Thu Apr 08, 2021 1:45 pm
Forum: Personal Investments
Topic: US % in Vanguard Total World Stock ETF (VT)
Replies: 3
Views: 410

Re: US % in Vanguard Total World Stock ETF (VT)

That data is in the Portfolio & Management tab.

https://investor.vanguard.com/etf/profile/portfolio/vt

56.7% as stated already.
by MrJedi
Thu Apr 08, 2021 1:35 pm
Forum: Investing - Theory, News & General
Topic: Junk bond yields vs. other bonds
Replies: 6
Views: 716

Re: Junk bond yields vs. other bonds

Can you explain how you are getting your numbers?
by MrJedi
Thu Apr 08, 2021 1:20 pm
Forum: Personal Finance (Not Investing)
Topic: 401k distribution and taxes
Replies: 13
Views: 973

Re: 401k distribution and taxes

That's a good point. It's not clear (to me at least) if the check(s) received were for direct rollovers (no tax withheld) or payable to the taxpayer/individual for potential indirect rollover (tax automatically withheld).
by MrJedi
Thu Apr 08, 2021 11:02 am
Forum: Personal Finance (Not Investing)
Topic: TaxSoftware - Worksheets before actually filing
Replies: 8
Views: 414

Re: TaxSoftware - Worksheets before actually filing

Try FreeTaxUSA. I like it as much, if not better, than TurboTax, and you get to see all the IRS forms filled out before submitting. You also can see them before paying, because it includes free federal e-filing for everyone. I agree. I used them for the first time this year and very pleased. Full p...
by MrJedi
Thu Apr 08, 2021 9:32 am
Forum: Personal Finance (Not Investing)
Topic: First time "mega" backdoor Roth
Replies: 14
Views: 1328

Re: First time "mega" backdoor Roth

My plan allows for both the in plan conversion to Roth 401k and the in service rollover to Roth IRA. I opted for the Roth 401k option because of the Fidelity automatic conversions, which are very convenient. Otherwise I would have to call in for the Roth IRA option each time. My 401k has good inves...
by MrJedi
Wed Apr 07, 2021 9:11 pm
Forum: Personal Finance (Not Investing)
Topic: Roth 401k RMD's
Replies: 10
Views: 802

Re: Roth 401k RMD's

Sasquatch1 wrote: Wed Apr 07, 2021 9:01 pm Someone correct me if I’m wrong but..

They force you to take the RMDs but it’s not taxable income. Could either use it or just reinvest it.
Yes, but reinvestment would likely have to be in taxable account, losing the tax free growth of the Roth.

Rollover to Roth IRA is the common approach here.
by MrJedi
Wed Apr 07, 2021 8:36 pm
Forum: Personal Finance (Not Investing)
Topic: 401k distribution and taxes
Replies: 13
Views: 973

Re: 401k distribution and taxes

Your 2020 tax return should show this $200 distribution since the distribution occured in 2020. You need to indicate that it is a rollover and thus nontaxable.

When you Roth convert the funds, that will be a 2021 tax return item, since the conversion occured in 2021.
by MrJedi
Wed Apr 07, 2021 8:01 pm
Forum: Personal Investments
Topic: Cash in CD for better yield?
Replies: 18
Views: 1439

Re: Cash in CD for better yield?

NAV on your proposed fund has dropped 87 bps this YTD. I don't understand what you are saying. Basis points would measure yield not nav and the change in bp is 3 bp from 1/4 to 4/7 and the nav dropped 12 cents. 1/4/2021 - 01/04/2021 $14.87 0.89% 4/7/2021 - 04/07/2021 $14.75 0.92% On 1/4/2021 nav wa...
by MrJedi
Wed Apr 07, 2021 7:08 pm
Forum: Personal Investments
Topic: Cash in CD for better yield?
Replies: 18
Views: 1439

Re: Cash in CD for better yield?

Using the latest dividend payments is not a good way to compare. The dividend payments are still partially made up of older bonds that are paying higher, this is captured in the NAV of the fund, so you are paying for it. If we assume interest remains constant, your dividends will continue to shrink...
by MrJedi
Wed Apr 07, 2021 6:40 pm
Forum: Personal Investments
Topic: Cash in CD for better yield?
Replies: 18
Views: 1439

Re: Cash in CD for better yield?

Using the latest dividend payments is not a good way to compare. The dividend payments are still partially made up of older bonds that are paying higher, this is captured in the NAV of the fund, so you are paying for it. If we assume interest remains constant, your dividends will continue to shrink ...
by MrJedi
Wed Apr 07, 2021 12:12 pm
Forum: Personal Investments
Topic: Employer 401K Losing Out of Matched Money
Replies: 39
Views: 2401

Re: Employer 401K Losing Out of Matched Money

Hi everyone, I asked T. Rowe Price if the plan allows for after-tax contributions, and this is what T. Rowe wrote back. I do not understand the response: "I have spoken to the conversion analyst and the plan design team. The SPD and other plan documents were posted a couple of weeks after the ...
by MrJedi
Wed Apr 07, 2021 11:45 am
Forum: Personal Finance (Not Investing)
Topic: Help calculating federal income tax withholding for disability benefits
Replies: 8
Views: 320

Re: Help calculating federal income tax withholding for disability benefits

If you can accurately estimate your 2021 taxable income and tax credits, then you can calculate the amount of tax liability you will have for 2021. More info is needed if you are looking for step by step numbers (filing status, deductions, credits, etc.) Then you would withhold an amount to try and...
by MrJedi
Wed Apr 07, 2021 11:38 am
Forum: Personal Finance (Not Investing)
Topic: Help calculating federal income tax withholding for disability benefits
Replies: 8
Views: 320

Re: Help calculating federal income tax withholding for disability benefits

If you can accurately estimate your 2021 taxable income and tax credits, then you can calculate the amount of tax liability you will have for 2021. More info is needed if you are looking for step by step numbers (filing status, deductions, credits, etc.) Then you would withhold an amount to try and ...
by MrJedi
Wed Apr 07, 2021 10:06 am
Forum: Personal Investments
Topic: How much cash do you really hold?
Replies: 91
Views: 6269

Re: How much cash do you really hold?

I include cash as part of the fixed income/bonds part of my portfolio. To me this is a more accurate reflection of risk. Otherwise somebody with $1000 in stocks, $0 in bonds, and $1MM in cash could say they are 100/0 allocation...I don't think that is an accurate representation of the risk they are ...
by MrJedi
Wed Apr 07, 2021 9:46 am
Forum: Personal Investments
Topic: Backdoor Roth in Vanguard question
Replies: 24
Views: 1580

Re: Backdoor Roth in Vanguard question

Contribution and conversion are separate steps. Contributions are allowed for retroactive tax year as you've done, but conversions are always accounted for in the current tax/calendar year. This is a common confusion. +1. This is the correct answer. Sorry OP, I don't think you can undo this. Based ...