Search found 10350 matches

by David Jay
Sat Apr 10, 2021 7:02 pm
Forum: Personal Investments
Topic: US Equity Allocation Strategy
Replies: 1
Views: 146

Re: US Equity Allocation Strategy

Welcome to the forum! VTI (Vanguard Total US Stock) is the default, low regret choice for your US Equity Allocation. It holds the entire US market at market weight so it is fully diversified. Adding any of your other choices to VTI is a tilt away from the market. A tilt away from the market essentia...
by David Jay
Sat Apr 10, 2021 6:33 pm
Forum: Personal Finance (Not Investing)
Topic: Age 63 retired, planning how to use Roth conversions
Replies: 7
Views: 666

Re: Age 63 retired, planning how to use Roth conversions

I am not surprised, it is a balancing act. Too much Roth conversion, pay excess conversion / IRMAA taxes. Too little Roth, pay excess RMD taxes.

Sounds like #2 is (a-la "Goldilocks") just right.
by David Jay
Sat Apr 10, 2021 3:40 pm
Forum: Personal Investments
Topic: Roth IRA 5 year rule (over 59.5) question.
Replies: 8
Views: 595

Re: Roth IRA 5 year rule (over 59.5) question.

jwc1754 wrote: Sat Apr 10, 2021 3:37 pm Does it reset a clock if you transferred a Roth account from TD to Vanguard (opened a new Roth account in VG)?
No. The primary 5 year clock is since you first funded your first Roth IRA. Even if you later closed the account.
by David Jay
Sat Apr 10, 2021 11:45 am
Forum: Personal Investments
Topic: Windfall going to invest @ AA but?
Replies: 2
Views: 367

Re: Windfall going to invest @ AA but?

I agree with “retired”, you should view all your accounts, combined as one portfolio and position assets in an optimal manner, rather than holding the 3-fund in every account.
by David Jay
Sat Apr 10, 2021 10:28 am
Forum: Personal Finance (Not Investing)
Topic: Withdrawal Frequency in Retirement
Replies: 22
Views: 1584

Re: Withdrawal Frequency in Retirement

Virtually all of our portfolio is in tax-advantaged accounts. In order to meet specific qualifications (ACA, MI Homestead, etc.) we carefully move money from tax advantaged to a taxable account that I call our "distribution" account (at the brokerage) a couple of times a year. We then have...
by David Jay
Sat Apr 10, 2021 10:18 am
Forum: Personal Finance (Not Investing)
Topic: Refund adjusted by IRS
Replies: 7
Views: 654

Re: Refund adjusted by IRS

I vote for "typo" by the OP (projecting from my own experience).

Plus, neither the IRS or TurboTax are new at this...
by David Jay
Sat Apr 10, 2021 9:17 am
Forum: Personal Finance (Not Investing)
Topic: Inheritance - help me get my head straight
Replies: 11
Views: 1454

Re: Inheritance - help me get my head straight

bungalow10 wrote: Sat Apr 10, 2021 6:18 amAm I missing something? I feel like there used to be an option to do RMDs based on life expectancy.
This feature (sometimes called the “stretch” IRA) was eliminated for the heirs of individuals passing after January 1, 2020. Sorry.
by David Jay
Sat Apr 10, 2021 8:55 am
Forum: Investing - Theory, News & General
Topic: Buying a range of bond maturities?
Replies: 2
Views: 278

Re: Buying a range of bond maturities?

In normal times, when future interest rates are unknown, holding a range of bond durations probably make sense. There is a widely-described “barbell” strategy of holding short term bonds and long term bonds to cover a wide range of outcomes. In these near-zero interest times, I cannot bring myself t...
by David Jay
Fri Apr 09, 2021 11:00 pm
Forum: Personal Finance (Not Investing)
Topic: Social Security decsion
Replies: 7
Views: 858

Re: Social Security decsion

The spouse with the higher earnings record should, under almost any circumstance, defer to age 70 because their benefit becomes the survivor’s benefit.

If the couple are well situated financially, it makes little difference what the lower earning spouse chooses.
by David Jay
Fri Apr 09, 2021 7:19 pm
Forum: Personal Finance (Not Investing)
Topic: [Backdoor] Roth Conversion Confusion
Replies: 7
Views: 439

Re: [Backdoor] Roth Conversion Confusion

Welcome to the forum!

Your tax guy is mistaken. We have lots of folks here who do the backdoor Roth process every year.

Here is the Wiki on the backdoor Roth process, he may benefit from this page: https://www.bogleheads.org/wiki/Backdoor_Roth
by David Jay
Fri Apr 09, 2021 7:13 pm
Forum: Personal Consumer Issues
Topic: Travel Trailer vs My Pickup Truck: Specs?
Replies: 24
Views: 1484

Re: Travel Trailer vs My Pickup Truck: Specs?

This is why we need the OP to explain his use. If he wants to pull the trailer 50 miles to the lake every spring and pull it 50 miles home in the fall, his truck will be fine. If he wants to pull the trailer out west and explore the Rockies, his truck won't cut it. There is a wide range of activitie...
by David Jay
Fri Apr 09, 2021 3:37 pm
Forum: Investing - Theory, News & General
Topic: Beat the market by only holding after hours
Replies: 56
Views: 3293

Re: Beat the market by only holding after hours

I read the article as saying that buy-and-hold outperforms day-trading( i.e. closing all positions each day).
by David Jay
Fri Apr 09, 2021 3:22 pm
Forum: Personal Investments
Topic: Life Savings in Cash--Need Advice
Replies: 14
Views: 2273

Re: Life Savings in Cash--Need Advice

Welcome to the forum! First off, you need to establish your level of comfort. Since you don't need the money for living expenses, you can afford to be conservative. The primary "control knob" for growth versus stability is the percentage of stocks versus bonds (+ other fixed income), calle...
by David Jay
Fri Apr 09, 2021 2:40 pm
Forum: Personal Finance (Not Investing)
Topic: H&R Block not allowing stock sale on 1099-B
Replies: 11
Views: 712

Re: H&R Block not allowing stock sale on 1099-B

1099-B is not the normal document for a stock sale through a brokerage house. Can you explain more about the 1099-B? Was this stock in a closely held company, perhaps not a public stock? Who issued the 1099-B? Guess I haven't sold any stocks in a taxable account for a while. I'm just used to gettin...
by David Jay
Fri Apr 09, 2021 2:32 pm
Forum: Personal Consumer Issues
Topic: Travel Trailer vs My Pickup Truck: Specs?
Replies: 24
Views: 1484

Re: Travel Trailer vs My Pickup Truck: Specs?

Sure you can pull it. It won't be great in the mountains, where are you planning on driving? I wouldn't recommend putting 3000 pounds in the trailer, but I don't even think you can in a trailer of that size. We always figured we had 1000 pounds of "stuff", that would put you at about 5500 ...
by David Jay
Fri Apr 09, 2021 12:30 pm
Forum: Personal Investments
Topic: Etrade cover transfer fee?
Replies: 6
Views: 519

Re: Etrade cover transfer fee?

This website says that Schwab does not have an account closing fee: https://www.brokerage-review.com/expert/cancel-account/how-to-close-charles-schwab-account.aspx The best route is to talk to an IRA transfer specialist at eTrade. They will know the ins and outs. More generally, always work with the...
by David Jay
Thu Apr 08, 2021 9:58 pm
Forum: Investing - Theory, News & General
Topic: TSLA gamed the system - Could Index Funds Be ‘Worse Than Marxism’?
Replies: 105
Views: 10688

Re: TSLA gamed the system - Could Index Funds Be ‘Worse Than Marxism’?

Also, the index funds won't just automatically buy in the given scenario you've presented. Index funds hold stock in proportion to market cap, not the number of shares outstanding. If the number of shares outstanding increase with a concomitant decrease in price that leads to an equal market cap be...
by David Jay
Thu Apr 08, 2021 8:05 pm
Forum: Investing - Theory, News & General
Topic: Why do Vanguard Target Date funds have such high tracking error?
Replies: 15
Views: 1998

Re: Why do Vanguard Target Date funds have such high tracking error?

For the first 15 years or so, the AA of the target fund will not change. My point stands, I am referring to rebalancing, not changes in AA.
by David Jay
Thu Apr 08, 2021 7:45 pm
Forum: Personal Investments
Topic: IRA, Roth Taxable
Replies: 6
Views: 411

Re: IRA, Roth Taxable

There is a wiki on tax efficient fund placement across various types of accounts here: https://www.bogleheads.org/wiki/Tax-eff ... _placement
by David Jay
Thu Apr 08, 2021 7:32 pm
Forum: Personal Investments
Topic: What is a good asset allocation for us?
Replies: 17
Views: 1503

Re: What is a good asset allocation for us?

retiredjg wrote: Thu Apr 08, 2021 4:20 pm
David Jay wrote: Thu Apr 08, 2021 4:06 pm This makes AA intensely personal. It is a negotiation between the head and the gut.
Such lovely wording and so true!
I stole “negotiation between the head and the gut” from someone here on BH, but it really set well with me.
by David Jay
Thu Apr 08, 2021 6:52 pm
Forum: Personal Investments
Topic: Etrade cover transfer fee?
Replies: 6
Views: 519

Re: Etrade cover transfer fee?

According to this link, Schwab does not have an account closing fee: https://www.schwab.com/pricing
by David Jay
Thu Apr 08, 2021 6:31 pm
Forum: Investing - Theory, News & General
Topic: Why 1971 has become the starting point for increasing income inequality?
Replies: 24
Views: 1569

Re: Why 1971 has become the starting point for increasing income inequality?

Supply and demand for labor. FWIW, increased "inequality" can be beneficial if the overall standard is rising. "Equality" is easy when everybody has nothing. In before the lock. How is that beneficial for everyone, from the fairness perspective? After all, the "overall stan...
by David Jay
Thu Apr 08, 2021 4:06 pm
Forum: Personal Investments
Topic: What is a good asset allocation for us?
Replies: 17
Views: 1503

Re: What is a good asset allocation for us?

Here at BH we teach that asset allocation (AA) is the primary "control knob" for growth versus stability. More stocks, more growth but also more volatility. This makes AA intensely personal. It is a negotiation between the head and the gut. The head says: "More growth is logical"...
by David Jay
Thu Apr 08, 2021 3:57 pm
Forum: Investing - Theory, News & General
Topic: Five Factor Investing with ETFs
Replies: 59
Views: 4438

Re: Five Factor Investing with ETFs

Five-factor investing was “the latest thing” starting about 10 years ago. A number of 5-factor funds and ETFs opened between 2014 and 2018. Performance has been disappointing. Last week a question prompted me to go look at the performance. I looked at 3, including the Vanguard fund and the largest ...
by David Jay
Thu Apr 08, 2021 9:14 am
Forum: Personal Investments
Topic: Family with 4 little humans: chances of retiring/financial independence
Replies: 70
Views: 7008

Re: Family with 4 little humans: chances of retiring/financial independence

There are some pieces to the puzzle missing. It looks like your income is about $97K and year and your Retirement savings are about $26K a year. I would guess that your mortgage payment is about $1,200 a month or a bit less than $15K a year. FICA taxes are around $7K a year too. Those and a lot of ...
by David Jay
Thu Apr 08, 2021 9:02 am
Forum: Personal Investments
Topic: Down Payment / We May Never Buy - About to Surrender "Toxic" VUL
Replies: 4
Views: 625

Re: Down Payment / We May Never Buy - About to Surrender "Toxic" VUL

If I was ever going to use a VUL (which I am not), I would probably start with TIAA. They will be among the lowest cost options. I would never hold SP500 inside a VUL. What is your marginal tax rate? 22%? 24%? You are just flushing money down the drain. If you keep it, I would hold 100% fixed accoun...
by David Jay
Thu Apr 08, 2021 8:55 am
Forum: Personal Investments
Topic: Vanguard: Moving funds between mutual / brokerage accounts
Replies: 2
Views: 471

Re: Vanguard: Moving funds between mutual / brokerage accounts

Yes, there is one extra day to move from the mutual fund account. If you were to convert the mutual fund account (so all accounts are brokerage accounts), then you could do an "exchange" between funds - even in different accounts - so the assets do not need the extra step of going through ...
by David Jay
Thu Apr 08, 2021 8:21 am
Forum: Investing - Theory, News & General
Topic: Why do Vanguard Target Date funds have such high tracking error?
Replies: 15
Views: 1998

Re: Why do Vanguard Target Date funds have such high tracking error?

I read the footnote on the Vanguard 2060 page [from the link above], it is not one benchmark, it consists of the (arithmetically combined) benchmarks for each of the underlying funds. By definition, a fund that holds the underlying funds in a constant ratio cannot match the composite benchmark becau...
by David Jay
Wed Apr 07, 2021 10:00 pm
Forum: Investing - Theory, News & General
Topic: TSLA gamed the system - Could Index Funds Be ‘Worse Than Marxism’?
Replies: 105
Views: 10688

Re: TSLA gamed the system - Could Index Funds Be ‘Worse Than Marxism’?

I would recommend two great videos from Ben felix. Some key take away points, 1. Trading sets the price of a stock not AUM. On trading, passive investing only accounts for 5% trading. It means, price is still dictated by the active traders. https://www.youtube.com/watch?v=Wv0pJh8mFk0 2. On other re...
by David Jay
Wed Apr 07, 2021 6:59 pm
Forum: Personal Investments
Topic: Should I get bond funds in my Etrade taxable?
Replies: 3
Views: 332

Re: Should I get bond funds in my Etrade taxable?

dmash wrote: Wed Apr 07, 2021 6:38 pmShould I just buy more VTSAX & VTIAX, and convert my tax-sheltered account into more VBTLX when I do my periodic rebalancing?
Yes, this is exactly what you should do. Hold bonds in tax-advantaged space and hold only stocks in taxable.
by David Jay
Wed Apr 07, 2021 3:45 pm
Forum: Investing - Theory, News & General
Topic: How long to turn 1 million to 2 millions for you?
Replies: 86
Views: 29358

Re: How long to turn 1 million to 2 millions for you?

Zombie thread - no posts for 5 years until this afternoon...
by David Jay
Wed Apr 07, 2021 2:40 pm
Forum: Personal Investments
Topic: FZROX vs FSKAX
Replies: 29
Views: 2518

Re: FZROX vs FSKAX

If I was going to pay double in expenses for a fund, then somebody better do some justification of what makes the "special sauce". Actually, you aren't paying double, you are paying infinitely more expense with FSKAX. :wink: Of course with FSKAX at 0.02% that infinitely higher ER only amo...
by David Jay
Wed Apr 07, 2021 2:33 pm
Forum: Personal Investments
Topic: FZROX vs FSKAX
Replies: 29
Views: 2518

Re: FZROX vs FSKAX

Dude2 wrote: Wed Apr 07, 2021 1:10 pm If I was going to pay double in expenses for a fund, then somebody better do some justification of what makes the "special sauce".
Actually, you aren't paying double, you are paying infinitely more expense with FSKAX. Do the math...:wink:
by David Jay
Wed Apr 07, 2021 10:29 am
Forum: Investing - Theory, News & General
Topic: How much do you spend annually in retirement?
Replies: 112
Views: 10216

Re: How much do you spend annually in retirement?

investnoob wrote: Wed Apr 07, 2021 10:18 am The answers lead me to believe that any retirement spending over what I spend is "high on the hog." Anything less than that isn't. Interesting.
Yup. It is mostly self-referential.
by David Jay
Wed Apr 07, 2021 8:29 am
Forum: Investing - Theory, News & General
Topic: TSLA gamed the system - Could Index Funds Be ‘Worse Than Marxism’?
Replies: 105
Views: 10688

Re: TSLA gamed the system - Could Index Funds Be ‘Worse Than Marxism’?

Also, the index funds won't just automatically buy in the given scenario you've presented. Index funds hold stock in proportion to market cap, not the number of shares outstanding. If the number of shares outstanding increase with a concomitant decrease in price that leads to an equal market cap be...
by David Jay
Tue Apr 06, 2021 9:10 pm
Forum: Personal Investments
Topic: Self-managed 3 Fund or Life Strategy vs Vanguard PAS for 80 year old
Replies: 12
Views: 1173

Re: Self-managed 3 Fund or Life Strategy vs Vanguard PAS for 80 year old

Per “000” above, TR Income is a reasonable choice as well. So, following my recommendation not to exceed 40% equities, here are 3 good choices at 3 different asset allocations:

40/60 LS Conservative Growth
30/70 TR Income
20/80 LS Income
by David Jay
Tue Apr 06, 2021 8:54 pm
Forum: Personal Investments
Topic: Coronavirus Retirement Withdrawal Ideas [Cash withdrawal, what now?]
Replies: 7
Views: 727

Re: Coronavirus Retirement Withdrawal Ideas [Cash withdrawal, what now?]

I'm not clear on this statement: there is an offsetting savings for making the 401K contribution I was under the impression there is no immediate benefit to making a Roth 401k contribution. Am I missing something? It probably could have been better phrased. Compare assets in your rollover IRA and a...
by David Jay
Tue Apr 06, 2021 4:54 pm
Forum: Personal Investments
Topic: Coronavirus Retirement Withdrawal Ideas [Cash withdrawal, what now?]
Replies: 7
Views: 727

Re: Coronavirus Retirement Withdrawal Ideas [Cash withdrawal, what now?]

Welcome to the forum! I would not pay taxes on the $100,000 while in the 24% tax bracket (plus state?). I would select option #1, as that is the only option where you do not need to pay taxes on $33,333 ($100,000 withdrawal divided 3 ways) of income for three years. [edit] Well, this is only logical...
by David Jay
Tue Apr 06, 2021 4:46 pm
Forum: Personal Investments
Topic: Self-managed 3 Fund or Life Strategy vs Vanguard PAS for 80 year old
Replies: 12
Views: 1173

Re: Self-managed 3 Fund or Life Strategy vs Vanguard PAS for 80 year old

Option 1 - but no more aggressive than Conservative Growth (40/60). Even LS Income (20/80) would be acceptable.

60/40 is "freak-out" level for an 80 year old with no experience managing his own portfolio.
by David Jay
Tue Apr 06, 2021 11:25 am
Forum: Personal Finance (Not Investing)
Topic: Bonus as only income eligible for IRA contributions?
Replies: 4
Views: 329

Re: Bonus as only income eligible for IRA contributions?

Yes, this bonus will be reported on a W-2 for 2021 as "taxable compensation" (the IRS term for qualified funds), so this amount of income qualifies you to contribute that amount (up to the maximum of $7000, obviously) to an IRA. You may use the entire amount shown in Box 1 of your W-2 (Box...
by David Jay
Mon Apr 05, 2021 6:54 pm
Forum: Investing - Theory, News & General
Topic: Basing Fixed Income Allocation From Historical Bear Market Recovery Times
Replies: 10
Views: 934

Re: Basing Fixed Income Allocation From Historical Bear Market Recovery Times

Do not base it on some percentage that aligns with... attitude toward risk ... I would completely disagree, I have been coming around to viewing Asset Allocation as pretty much exclusively a behavioral issue, not a math issue. One should not allocate more to equities than they can hold in the face ...
by David Jay
Mon Apr 05, 2021 5:27 pm
Forum: Personal Investments
Topic: Help with Dear Mother's Retirement Portfolio
Replies: 13
Views: 1100

Re: Help with Dear Mother's Retirement Portfolio

3) Best option to replace the non-qualified annuity when the surrender charge drops to zero in 2024? Yes, I would strongly recommend surrendering the annuity. The one real purpose for an annuity is to provide an income stream. From what you have written above, her needs are covered and so she does ...
by David Jay
Mon Apr 05, 2021 3:17 pm
Forum: Non-US Investing
Topic: Can someone help me understand this annuity?
Replies: 15
Views: 1581

Re: Can someone help me understand this annuity?

By comparing the 3% yield with fees, it seems the actual yield would be 2.25% for contribution to retirement, which means I am paying 0.75% to secure a 2.25% yield. If my calculation is correct... Your calculation is not correct because you did not fully grasp my first post above. There is no 3% yi...
by David Jay
Mon Apr 05, 2021 2:42 pm
Forum: Personal Finance (Not Investing)
Topic: Too early to retire?
Replies: 53
Views: 6739

Re: Too early to retire?

Welcome to the forum!

In my opinion, someone in their early 50s should target a Withdrawal rate of 3%, which only provides about 100,000 a year. In order to retire, it would seem that some income is required or else a significant reduction in standard of living.
by David Jay
Mon Apr 05, 2021 12:55 pm
Forum: Personal Investments
Topic: Are converted Roth IRA Contributions Penalty Free Withdrawal?
Replies: 36
Views: 2419

Re: Are converted Roth IRA Contributions Penalty Free Withdrawal?

In all cases, the amount of each conversion can be withdrawn tax free in 5 years. Pre-tax and after-tax conversions have somewhat different treatment. The future earnings (inside the Roth) on the conversion are taxable until age 59.5
by David Jay
Mon Apr 05, 2021 12:51 pm
Forum: Personal Investments
Topic: How to shift to more conservative AA
Replies: 12
Views: 1153

Re: How to shift to more conservative AA

Follow your IPS - that's why you have one.

Go all the way to 75/25 today, with the nice up market.
by David Jay
Mon Apr 05, 2021 11:07 am
Forum: Personal Investments
Topic: Roth IRA for 11 Year Old: Asset Allocation Ideas
Replies: 10
Views: 857

Re: Roth IRA for 11 Year Old: Asset Allocation Ideas

Option B - They will come to understand market gyrations at a young age. They will see the market drop and then exceed previous highs. What a great learning tool.

Alternate: 100% VTI
by David Jay
Mon Apr 05, 2021 8:39 am
Forum: Investing - Theory, News & General
Topic: "A Statue For John Bogle. I'll Do You One Better.
Replies: 1
Views: 503

Re: "A Statue For John Bogle. I'll Do You One Better.

Thanks, Taylor. I had read about the “Stamp Out Index Funds” poster but this article is the first time I have seen it.
by David Jay
Sun Apr 04, 2021 7:22 pm
Forum: Personal Investments
Topic: Mom's Legacy
Replies: 19
Views: 2822

Re: Mom's Legacy

I agree with Googliebear - if you are not fully funding your retirement accounts i would use the funds for that purpose. If you have a work 401K, the process is to increase your withholding and then spend the cash for living expenses. This has the effect of “transferring” your Mom’s legacy into your...