Search found 5643 matches

by afan
Sat Apr 17, 2021 2:58 pm
Forum: Personal Investments
Topic: Lower bond percentage after you won the game?
Replies: 60
Views: 6466

Re: Lower bond percentage after you won the game?

Part of winning the game is no longer worrying about market returns. If you have safe sources of enough to live in, then the rest is left to heirs. Their time frames are long and what happens in the next few years does not matter in a 60-year horizon.
by afan
Sat Apr 17, 2021 2:45 pm
Forum: Investing - Theory, News & General
Topic: Going to receive around $1 million - what to do ?
Replies: 28
Views: 4227

Re: Going to receive around $1 million - what to do ?

I would not do PAS. You can do yourself what they would do and save the fee. A broad index fund- say VTI for domestic, VXUS for international and then either BND or VTRB, depending on your tax bracket. It is more efficient to use total stock market than S&P 500 plus extended market. Buy an apart...
by afan
Sat Apr 17, 2021 2:23 pm
Forum: Investing - Theory, News & General
Topic: Don't fuss about 529 accounts. Have your child skip the first two years of college instead!
Replies: 61
Views: 4040

Re: Don't fuss about 529 accounts. Have your child skip the first two years of college instead!

abuss368 wrote: Sat Apr 17, 2021 1:43 pm Opening Vanguard College 529 accounts for the kids at an early age, and selecting one simple all in one Target fund, was in hindsight an excellent decision.

Tony
+1

We started saving for our kids before they were conceived.
by afan
Sat Apr 17, 2021 1:04 pm
Forum: Investing - Theory, News & General
Topic: Don't fuss about 529 accounts. Have your child skip the first two years of college instead!
Replies: 61
Views: 4040

Re: Don't fuss about 529 accounts. Have your child skip the first two years of college instead!

Re: the "college experience". Recently I realized that I did not have one. Listening to people reminisce about college days at an online reunion event, it became clear that what they remembered was totally different from what I did. They had all these wonderful times hanging out in the dor...
by afan
Sat Apr 17, 2021 12:47 pm
Forum: Investing - Theory, News & General
Topic: Don't fuss about 529 accounts. Have your child skip the first two years of college instead!
Replies: 61
Views: 4040

Re: Don't fuss about 529 accounts. Have your child skip the first two years of college instead!

Many problems with this approach. Requires that either the high school offers sufficiently advanced courses or that there is a suitable community or 4 year college nearby. Requires the student to be capable of doing an accelerated program. Some can, many cannot. Requires that the middle school and h...
by afan
Fri Apr 16, 2021 10:49 pm
Forum: Investing - Theory, News & General
Topic: Schwab trying to dissuade me from Vanguard bond funds
Replies: 19
Views: 2221

Re: Schwab trying to dissuade me from Vanguard bond funds

Seriously, ignore this. And any other marketing pitches the Schwab person may send your way. If you want to have fun, ask whether the ace bond pickers to which they refer will do the job for a lower cost than the Vanguard funds. I have a sneaking suspicion that they will want at least 10 times more...
by afan
Fri Apr 16, 2021 5:42 pm
Forum: Investing - Theory, News & General
Topic: Schwab trying to dissuade me from Vanguard bond funds
Replies: 19
Views: 2221

Re: Schwab trying to dissuade me from Vanguard bond funds

Seriously, ignore this. And any other marketing pitches the Schwab person may send your way. If you want to have fun, ask whether the ace bond pickers to which they refer will do the job for a lower cost than the Vanguard funds. I have a sneaking suspicion that they will want at least 10 times more....
by afan
Thu Apr 15, 2021 4:27 pm
Forum: Personal Finance (Not Investing)
Topic: Do tax preparer add value for 7 figure W2 income
Replies: 32
Views: 1881

Re: Do tax preparer add value for 7 figure W2 income

Your tax situation and bracket is the same as mine. I do it myself. One year I had a professional do it because my wife insisted. Never again. They didn't adjust the basis on the RSUs even though I gave them the supplemental paperwork. And done. Fired. You would think seeing a "your client owe...
by afan
Thu Apr 15, 2021 4:25 pm
Forum: Personal Finance (Not Investing)
Topic: Do tax preparer add value for 7 figure W2 income
Replies: 32
Views: 1881

Re: Do tax preparer add value for 7 figure W2 income

I agree that your simple tax situation does not offer many places for you to make a mistake or for a paid preparer to help. On the other hand, you may want to talk to a CPA who gives tax advice. They may be able to help you think of how investments, for example, can lower your overall tax bill. Rea...
by afan
Thu Apr 15, 2021 1:16 pm
Forum: Personal Finance (Not Investing)
Topic: Selling a Time Share
Replies: 40
Views: 3497

Re: Selling a Time Share

That is why I assume they would want the stream of future payments, not just for one year. Or a cash settlement of equal value.

Someone who died with no assets hopefully would have stopped paying on the timeshare long before.
by afan
Thu Apr 15, 2021 12:52 pm
Forum: Personal Finance (Not Investing)
Topic: Do tax preparer add value for 7 figure W2 income
Replies: 32
Views: 1881

Re: Do tax preparer add value for 7 figure W2 income

I agree that your simple tax situation does not offer many places for you to make a mistake or for a paid preparer to help. On the other hand, you may want to talk to a CPA who gives tax advice. They may be able to help you think of how investments, for example, can lower your overall tax bill. Real...
by afan
Thu Apr 15, 2021 10:02 am
Forum: Personal Finance (Not Investing)
Topic: Selling a Time Share
Replies: 40
Views: 3497

Re: Selling a Time Share

If the timeshare was left to no one, or all heirs disclaimed, I assume the company could go after the estate for the payments. What do they do? Calculate the price of a perpetuity that would would the annual payments and demand that much?
by afan
Wed Apr 14, 2021 9:16 pm
Forum: Investing - Theory, News & General
Topic: Another 2.8% SWR Article Quoting Wade Pfau
Replies: 252
Views: 13862

Re: Another 2.8% SWR Article Quoting Wade Pfau

BTW, the graduation rate from that American College of Financial Services is in the mid 30% range. What a rip off. The overall completion rate for all Huebner School designation programs was 34.9 percent for the same period of time. You may not respect Dr. Pfau's work, but members of Congress and h...
by afan
Wed Apr 14, 2021 8:45 pm
Forum: Personal Finance (Not Investing)
Topic: "Nobody's ever regretted paying off the mortgage."
Replies: 290
Views: 18247

Re: "Nobody's ever regretted paying off the mortgage."

I enjoy reading all these points of view and the careful thinking that has gone into quite-different approaches. In the current low-rate environment, it is tempting for me to be even more inclined to favor keeping the mortgage and increasing investments in stock-heavy portfolios. On the other hand,...
by afan
Wed Apr 14, 2021 8:41 pm
Forum: Personal Finance (Not Investing)
Topic: "Nobody's ever regretted paying off the mortgage."
Replies: 290
Views: 18247

Re: "Nobody's ever regretted paying off the mortgage."

You do not make yourself better off by getting rid of the mortgage. I'm happier not having a mortgage. That sure feels like better off to me. And once your portfolio is big enough, it doesn't really matter with you've maximized your capital efficiency or not. Oh, and the ROI I can get on my cashflo...
by afan
Wed Apr 14, 2021 7:02 pm
Forum: Personal Finance (Not Investing)
Topic: "Nobody's ever regretted paying off the mortgage."
Replies: 290
Views: 18247

Re: "Nobody's ever regretted paying off the mortgage."

Pre or post retirement has nothing to do with it. If you pay off the mortgage, you have less money available to spend in retirement. People pretend that paying it off is somehow free- as if you have the same assets at retirement whether you pay off or keep the loan. You do not make yourself better o...
by afan
Wed Apr 14, 2021 7:00 pm
Forum: Personal Finance (Not Investing)
Topic: "Nobody's ever regretted paying off the mortgage."
Replies: 290
Views: 18247

Re: "Nobody's ever regretted paying off the mortgage."

I am sure there have been people who have paid off mortgages only to later discover that they needed cash. Depending on the circumstances, they may have been able to take out a home equity loan or HELOC but generally those charge higher rates. If you have no fear of needing the money, then it is jus...
by afan
Wed Apr 14, 2021 3:04 pm
Forum: Investing - Theory, News & General
Topic: Investment strategies for high net worth individuals
Replies: 86
Views: 11373

Re: Investment strategies for high net worth individuals

Direct indexing has always struck me as a gimmick for the reasons others have noted. Same for the TLH services of a robo adviser. If you use broad cap weighted index funds there are not that many TLH opportunities and it is unlikely they would add up to enough to justify the fees. At high net worth ...
by afan
Tue Apr 13, 2021 5:49 pm
Forum: Investing - Theory, News & General
Topic: Another 2.8% SWR Article Quoting Wade Pfau
Replies: 252
Views: 13862

Re: Another 2.8% SWR Article Quoting Wade Pfau

I really don't understand this whole argument. Surely the easiest way to calculate what you might need for retirement is to: Calculate how much gross you would need a year to have a life-style you would like Adjust in any given year if you have extra income/expenses for that year For each year, inf...
by afan
Tue Apr 13, 2021 5:36 pm
Forum: Personal Finance (Not Investing)
Topic: Medical Group wants me to be CFO -- advice?
Replies: 35
Views: 3513

Re: Medical Group wants me to be CFO -- advice?

I would not touch this. Not as the CEO has presented it. Lots of responsibility, a large amount of work with neither compensation nor time? No way. Trying to do the job nights and weekends is not working for the CEO. There is no reason to expect it will work for you. The reluctance to bring in and p...
by afan
Mon Apr 12, 2021 5:08 pm
Forum: Investing - Theory, News & General
Topic: Another 2.8% SWR Article Quoting Wade Pfau
Replies: 252
Views: 13862

Re: Another 2.8% SWR Article Quoting Wade Pfau

The argument that past success may not apply here is based on us having historically high valuations for both stocks and bonds. To the extent that PE ratios predict long term stock returns, they imply poor real returns for stocks and current yields imply similarly poor returns for bonds. Thus, so th...
by afan
Mon Apr 12, 2021 4:43 pm
Forum: Personal Finance (Not Investing)
Topic: The primary factor for picking a College/University is out of pocket cost
Replies: 207
Views: 10011

Re: The primary factor for picking a College/University is out of pocket cost

They had to define it that way. Their goal was isolating the effect of the college a student attended from whatever individual characteristics of the student made them an attractive applicant to a college. Their approach said, in effect, "whatever it may be that elite colleges value in admissio...
by afan
Sun Apr 11, 2021 5:30 pm
Forum: Personal Finance (Not Investing)
Topic: The primary factor for picking a College/University is out of pocket cost
Replies: 207
Views: 10011

Re: The primary factor for picking a College/University is out of pocket cost

The difference between the top and lower Ivies is a lot less than reputation would suggest. Very similar academic preparation of the students coming in. Very similar distribution of career paths afterwards. The major difference is whether the Ivy has a full range of professional schools, although P...
by afan
Sun Apr 11, 2021 5:24 pm
Forum: Personal Finance (Not Investing)
Topic: The primary factor for picking a College/University is out of pocket cost
Replies: 207
Views: 10011

Re: The primary factor for picking a College/University is out of pocket cost

But what do you do with a kid who is top 0.05%? The truth is, very few places can offer an appropriate peer group for them. Actually, even the flagship state schools work well for them. There will always be faculty on the lookout for the rare brilliant student. There do not have to be a lot of them...
by afan
Sun Apr 11, 2021 3:03 pm
Forum: Personal Finance (Not Investing)
Topic: The primary factor for picking a College/University is out of pocket cost
Replies: 207
Views: 10011

Re: The primary factor for picking a College/University is out of pocket cost

This assumes that all college, community vs flagship state vs elite private is equal for all students. As others have noted, the elite privates have enough seats in required courses for everyone who needs them to take them on time. So their engineers, for example, graduate in 4 years. Your communit...
by afan
Sun Apr 11, 2021 12:27 pm
Forum: Personal Finance (Not Investing)
Topic: The primary factor for picking a College/University is out of pocket cost
Replies: 207
Views: 10011

Re: The primary factor for picking a College/University is out of pocket cost

This assumes that all college, community vs flagship state vs elite private is equal for all students. As others have noted, the elite privates have enough seats in required courses for everyone who needs them to take them on time. So their engineers, for example, graduate in 4 years. Your community...
by afan
Sun Apr 11, 2021 12:09 pm
Forum: Personal Investments
Topic: too much in munis?
Replies: 11
Views: 1124

Re: too much in munis?

Most of our fixed income is in taxable bond funds held in tax favored accounts. Those are investment grade corporate and Treasury. We keep some in munis in taxable accounts to have a source of ready money if we need it. Those are a mix of investment grade short term and intermediate term muni bond f...
by afan
Sat Apr 10, 2021 12:54 pm
Forum: Personal Finance (Not Investing)
Topic: Ed Slott's new book NEW RETIREMENT SAVINGS TIME BOMB
Replies: 154
Views: 11162

Re: Ed Slott's new book NEW RETIREMENT SAVINGS TIME BOMB

The forum rules only prohibit speculating about what those changes might be. I have never seen anyone claim one should not consider the possibility, just not discuss potential details on here
by afan
Fri Apr 09, 2021 9:52 pm
Forum: Personal Finance (Not Investing)
Topic: Irrevocable subtrusts
Replies: 22
Views: 1154

Re: Irrevocable subtrusts

It does not matter who is executor or personal representative. The positions have no role in the trust. If your mom is the only trustee, then she is limited to HEMS in making distributions. At the time of the decisions, it is up to her to determine what expenses would qualify. However, creditors and...
by afan
Fri Apr 09, 2021 7:15 pm
Forum: Personal Investments
Topic: Financial advisor help
Replies: 22
Views: 2118

Re: Financial advisor help

You want an hourly fee advisor. Such a person sells advice only. They would not manage your investments. They would suggest what you should do and leave it to you to do it. They will charge you an hourly rate or maybe quote a fee for the initial consultation and advice, with hourly fees for any late...
by afan
Fri Apr 09, 2021 7:05 pm
Forum: Personal Finance (Not Investing)
Topic: Irrevocable subtrusts
Replies: 22
Views: 1154

Re: Irrevocable subtrusts

The trust could buy a house. Then the trust would own it and it would remain outside your mom's estate. With $2M total outside the trust, your parents are not likely to have estate tax concerns. There is some asset protection to having the money in the trust as opposed to belonging to her outright. ...
by afan
Fri Apr 09, 2021 6:41 pm
Forum: Personal Finance (Not Investing)
Topic: Irrevocable subtrusts
Replies: 22
Views: 1154

Re: Irrevocable subtrusts

Assuming the trust was created with estate taxes in mind, you still need to provide more information. Is there an independent trustee as bsteiner was suggesting? Is there a provision permitting your mom to withdraw money for HEMS? As you describe it, the attorney is suggesting that your mom NOT with...
by afan
Fri Apr 09, 2021 6:32 pm
Forum: Personal Finance (Not Investing)
Topic: Home insurance deductibles?
Replies: 8
Views: 657

Re: Home insurance deductibles?

We have always carried very high deductibles and no mortgage company has ever objected. We have not lived in high risk areas and have never had a claim. So the deductibles worked out for us. I would check the premiums you would pay at progressively higher deductibles until you get to the highest you...
by afan
Wed Apr 07, 2021 12:20 pm
Forum: Personal Finance (Not Investing)
Topic: When to hire a fee based CFP?
Replies: 12
Views: 698

Re: When to hire a fee based CFP?

I agree that you could learn to handle most of this yourself from this site and others like it. For tax-related decisions specifically related to retirement, I also agree that it is probably too early, given the frequency with which the tax laws change. Note that financial planners have confused the...
by afan
Tue Apr 06, 2021 12:52 pm
Forum: Personal Investments
Topic: Lower bond percentage after you won the game?
Replies: 60
Views: 6466

Re: Lower bond percentage after you won the game?

We are doing what the OP proposed- once we have enough in short and intermediate term bonds to fully fund retirement, money above that goes into stocks. As others have noted, that stock money is really for our heirs, not for us, so it is reasonable to be aggressive. To be conservative, our "eno...
by afan
Mon Apr 05, 2021 6:16 pm
Forum: Personal Finance (Not Investing)
Topic: Am I crazy for having a high deductible?
Replies: 18
Views: 1938

Re: Am I crazy for having a high deductible?

For us, never having filed a claim, the premiums saved were all profit.

Going far higher than $1,000 reduced premiums. There was a limit at which further increasing the deductible had a negligible effect, so we put our deductible at that inflection point.
by afan
Mon Apr 05, 2021 12:52 pm
Forum: Personal Investments
Topic: PAS Experience
Replies: 6
Views: 773

Re: PAS Experience

I agree that there is no reason to hire PAS if you can manage a simple portfolio yourself. Most people can manage simple portfolios themselves, so most people have no need for PAS. PAS is useful for those who CANNOT do it themselves. For those people, it is about as cheap as one can get for a simple...
by afan
Mon Apr 05, 2021 12:47 pm
Forum: Personal Finance (Not Investing)
Topic: Am I crazy for having a high deductible?
Replies: 18
Views: 1938

Re: Am I crazy for having a high deductible?

I would not have filed a claim for the roof, even if I had a low deductible. I would worry about the effects on my rates. If I lived in an area with a lot of wind and hail damage, I might worry about even being allowed to keep the policy. For homeowners, it generally pays to have a high deductible, ...
by afan
Sun Apr 04, 2021 4:58 pm
Forum: Personal Finance (Not Investing)
Topic: Using term life to hedge a spouse's pension?
Replies: 10
Views: 886

Re: Using term life to hedge a spouse's pension?

This does not sound like a job for term life. As your partner ages it will become extremely expensive? Drop it at that point? Then you would be out both the cash you paid for the term and the death benefit. Still trying to make do without the pension.
by afan
Sun Apr 04, 2021 4:55 pm
Forum: Investing - Theory, News & General
Topic: Stone Ridge All Asset Variance Risk Premium Fund
Replies: 133
Views: 6741

Re: Stone Ridge All Asset Variance Risk Premium Fund

In defense of quants: There is a difference between trying to determine the forces that drive market returns as an intellectual exercise and trying to create a way to earn excess risk adjusted returns. The quant approach has made major contributions to the former. Not so much for the latter. I can u...
by afan
Sun Apr 04, 2021 10:10 am
Forum: Personal Finance (Not Investing)
Topic: Secure Act and trusts
Replies: 159
Views: 8597

Re: Secure Act and trusts

I suppose my overall point is that it is difficult to derive an answer that is generally applicable to everyone, since the moving parts vary. It is difficult to model this correctly without being careful to work through the actual taxes to be paid. Those suffer the complexity of the tax system and m...
by afan
Sat Apr 03, 2021 8:57 pm
Forum: Personal Finance (Not Investing)
Topic: Secure Act and trusts
Replies: 159
Views: 8597

Re: Secure Act and trusts

Agree it makes no sense to do a charitable trust if the beneficiary is in a position to save the entire after tax distribution. I think the point of modeling this was to permit a comparison to the accumulation trust. If you expect your beneficiary to simply save the distributions, then the CRT just ...
by afan
Sat Apr 03, 2021 8:50 pm
Forum: Personal Finance (Not Investing)
Topic: Secure Act and trusts
Replies: 159
Views: 8597

Re: Secure Act and trusts

For those working past 72, starting SS at 70 and RMDs at 72, Roth conversions don't seem to work to save income taxes. They might work to save estate taxes. We're talking about tax advantages when left to a trust post-SECURE act. There are huge advantages in this scenario of the Grantor aggressivel...
by afan
Sat Apr 03, 2021 4:09 pm
Forum: Personal Finance (Not Investing)
Topic: Secure Act and trusts
Replies: 159
Views: 8597

Re: Secure Act and trusts

If one assume 5% total return on an investment portfolio, 60/40 stocks/munis, 2% dividend rate on the stock component: The dividends as a percent of the whole portfolio are 0.6 x 2= 1.2%. The rest of the 5% return is either tax exempt interest or unrealized capital gains. Tax those dividends at 15% ...
by afan
Sat Apr 03, 2021 2:59 pm
Forum: Personal Finance (Not Investing)
Topic: Secure Act and trusts
Replies: 159
Views: 8597

Re: Secure Act and trusts

I appreciate seeing the calculations and wonder how Roth conversions affect the outcome. For example, convert the $1M tIRA over 4 years to Roth @ 24% marginal rate per year. Roth grows 10 years then becomes inherited Roth IRA and has the potential grow another 10 years prior to distribution, tax fr...
by afan
Sat Apr 03, 2021 2:54 pm
Forum: Personal Finance (Not Investing)
Topic: Secure Act and trusts
Replies: 159
Views: 8597

Re: Secure Act and trusts

afan makes a lot of excellent points. Many of these threads worry about the high/quick trust marginal rates on ordinary income, but that's mostly pertinent to a trust inheriting a tIRA or some other asset that generates ordinary income. I guess it would also apply to a portfolio that is actively ma...
by afan
Sat Apr 03, 2021 2:34 pm
Forum: Personal Finance (Not Investing)
Topic: Secure Act and trusts
Replies: 159
Views: 8597

Re: Secure Act and trusts

Your math is wrong on both options. How is that? There is no annual tax drag on investments that do not spit out large dividends and are held, not sold. I have no idea what this means. The tax is on the beneficiaries, who are taxed on the income received. Re-read the assumptions. Here we are talkin...
by afan
Sat Apr 03, 2021 1:58 pm
Forum: Personal Finance (Not Investing)
Topic: Secure Act and trusts
Replies: 159
Views: 8597

Re: Secure Act and trusts

Can you elaborate on why you think Vanguard would not invest this way? Are you saying they would not use their muni funds to keep qualified dividends low? What would they do instead? Also, in a trust, who normally does this sort of analysis and optimization? I assume the trustee or investment manag...
by afan
Sat Apr 03, 2021 12:30 pm
Forum: Personal Finance (Not Investing)
Topic: Secure Act and trusts
Replies: 159
Views: 8597

Re: Secure Act and trusts

I am viewing this from the perspective of the beneficiary of either the CRUT or the discretionary trust. In essence, the CRUT allows tax recognition of the tIRA's proceeds over a period of 20 years (give or take), at a lower effective tax rate, here 20%, than the discretionary trust that withdrew a...
by afan
Fri Apr 02, 2021 11:42 am
Forum: Personal Finance (Not Investing)
Topic: Secure Act and trusts
Replies: 159
Views: 8597

Re: Secure Act and trusts

A note on the tax implications: Although we are talking of the income at which the trust reaches the 37% bracket, most, perhaps all of the income of the trust is likely to be qualified dividends or capital gains . For a $1M trust invested 60/40, the stock component might generate 2% qualified divide...