Portfolio advise/no experience in investing

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Topic Author
Buglady
Posts: 11
Joined: Mon Jan 17, 2022 5:47 pm

Portfolio advise/no experience in investing

Post by Buglady »

Hi,
Im new to the forum. Im a 57-year old divorced woman and and im worried about my future finances.
I recently have asked my ex husband for advice. He has set up an investment plan for me and has recommended me to ask this group to review his advice.
Im looking forward to hearing back from you. Thanks in advance.
This is what he prepared for me:

Age: 57
Sex: F
Estate of Residence: OK
Housing: I own my house. No mortgage.
Car loan: 14,000 to pay-off

2020 Marginal Tax Bracket: 12 %
Current income: 35,000 per year

Current portfolio:

Local Bank
Checking: 5,000
Savings: 70,000
Money Market: 30,000
CD: 35,000

TIAA
Money Market: 200,000
Employer Retirement Plan: 320,000.
Traditional IRA: 7,000
Both retirement plans are invested in 12 mutual funds with an asset allocation of 50 % in equity

Total Portfolio: 667,000

Estimated retirement in 2031 at 67 years old (FRA)
Estimated SS benefits of 15,000 per year in 2031
Estimated Expenses of 25,000 per year

Some of my thoughts are:

You currently have more than 50% of your portfolio in cash. This is way too much.
Currently both retirement plans are invested in 12 mutual funds with an asset allocation of 50 % in equity
I recommend opening Vanguard accounts and moving everything that is not invested in TIAA employer retirement account to Vanguard.
I recommend investments that are simple and easy to manage (hand-free and advisor-free)
You expressed the interest to avoid international investments.

Here are my recommendations:

1. Pay off your car loan and prepare a Transfer on Death (TOD) document for the car
2. Open a Vanguard Brokerage Account
3. Open a Vanguard Traditional IRA Account and rollover you IRA
4. Leave 6 months expenses (12,500) in your local bank money market account.
5. Leave the employer retirement plan with TIAA. Later it can be converted to an annuity in 2031 in complement to the SS.
6. Set up beneficiaries (primary and secondary) or POD or TOD in all accounts.
7. Set auto re-investment in all accounts.

How your investments will look like:

Local Bank:
Checking: 5,000
Money Market: 12,500
Savings: 0
CD: 0
Total “Cash” 17,500

Vanguard:
Traditional IRA: 7,000 all invested in Vanguard Balanced Index Fund - VBIAX (60% equity – 40% Bonds)
Brokerage: 308,500 all invested in VBIAX also.

TIAA
Employer Retirement Fund: 320,000. Allocate 192,000 (60%) in VTSAX and 128,000 (40%) in TIAA guarantee (fixed income that pays 3% minimum per year). This will match your asset allocation with the Vanguard Traditional IRA and Brokerage accounts but using the funds available in your retirement account.

You can sell shares of your Vanguard Brokerage VBIAX and move the funds to your local bank to cover your regular as well as extra expenses if needed.

In 2031 you can retire with 15,000 SS benefit + 40,000 from converting the TIAA employer retirement to an annuity which is more than your expected expenses. You have options if you decide to slow down and progressively move into retirement. If you decide to slow down and gradually reduce your workload and work income in the next few years, we can revisit the plan. I would advise to wait until full retirement age to apply for SS but you may be able to convert TIAA plan to an annuity and withdraw from your Vanguard brokerage account as needed if you decide to stop working earlier than 2031.

As alternatives to VBIAX, you can consider Vanguard's Lifestyle or Target Date funds. All would be hands-free but they have some international investments both in equity as well as in bonds.

I recommend creating an account at bogleheads forum to share this plan and ask for feedback. Maybe they can spot something that I have overlooked or have better suggestions.

You also should consider:
1. Body donation with University of Oklahoma Health and Sciences Center.
2. Set up a TOD for the house.
3. Set up Last Will and Testament, Durable Power of Attorney and Advanced Directive of Health Care
chassis
Posts: 2183
Joined: Tue Mar 24, 2020 4:28 pm

Re: Portfolio advise/no experience in investing

Post by chassis »

You are in good shape. Your expenses after Social Security should be less than 4% of what your investments should be at your retirement age. Well done, you should have won the game by that time. "should be" means using average historical market returns to estimate your future investment value.

Agree with the first set of recommendations. I have no opinion on the last set of recommendations (body donation, etc.).
User avatar
calmaniac
Posts: 1325
Joined: Fri Jan 30, 2015 2:32 pm

Re: Portfolio advise/no experience in investing

Post by calmaniac »

Looks like your plan will work within the constraints you've noted. Your ex has been thoughtful in his advice.

A few thoughts:

• I'm not sure what type of account the Employer Retirement Plan at TIAA is. I can't really comment, given that. Can you move it into an IRA now? See next comment.
• You mention "convert TIAA plan to an annuity". I'd want to understand that better. Why do you need an annuity?
• If you do need an annuity, why are you not taking full advantage of the best annuity out there
-->
waiting to age 70 to take Social Security. There is no annuity available that is going to provide an income stream as efficiently as the money you would get from waiting an additional 3 years for Social Security.
• Long-term care. What are your plans if you are no longer able to care for yourself? Do you have sufficient family and friends to take care of you?
• How long were you married? If married ≥10 years and if ex-husband dies before you, you may be eligible for ex-husband's full Social Security benefit (if greater than yours). Worth talking with someone with Social Security expertise on the details.

Congratulations, you've work hard and have a workable plan in place. Wonderful things ahead!
"Pretired", working 20 h/wk. AA 75/25: 30% TSM, 19% value (VFVA/AVUV), 18% Int'l LC, 8% emerging, 25% GFund/VBTLX. Military pension ≈60% of expenses. Pension+SS@age 70 ≈100% of expenses.
User avatar
retiredjg
Posts: 54082
Joined: Thu Jan 10, 2008 11:56 am

Re: Portfolio advise/no experience in investing

Post by retiredjg »

Welcome to the forum. :happy

I don't think you need to be worried about your finances. You have a nice nest egg and it is somewhat larger than needed to sustain your low living expenses....assuming you don't leave so much of it in cash and money market.

Your ex-husband's suggestions are all reasonable. People will have suggested changes here and there.

My suggestion is that a portfolio at 60% stock may be a little too aggressive for your nature after you retire. On the other hand, you may gain enough knowledge in the next 10 years that you will feel perfectly fine with it when that time comes.

Other than getting your cash invested sooner rather than later, many of these decisions can be put off until a later date. There is no need to decide everything right now. You have options, good ones, and you will become more confident about these decisions as you learn more.

The nature of your post and your situation indicates that you may not have a lot of financial experience at this point. This may be scary, but it can easily be changed by just learning a little bit at a time. In a year, you will look back and be amazed at how much progress you have made.

I would suggest that you start with two things. First, get very familiar with the Getting Started area of the Wiki and then move on to other areas of the Wiki as you run into questions. For example, if you wonder how an IRA works, look up IRA in the Wiki. And ask questions here on the forums.

https://www.bogleheads.org/wiki/Getting_started Be sure you don't miss the videos.

Second, a good book to get started learning about finances and investing can be found here. There are many other books as well, I'm just suggesting this one first. https://www.amazon.com/Only-Investment- ... 0544781937 The 2016 edition seems to be the last one available.

After that, tackle one of the Bogleheads' books.

I'm suggesting these books first because they are written in a way that people with little to no experience can easily understand.

If I have mis-judged your situation or experience, please forgive and just consider these are good suggestions for more experienced people as well. :happy
User avatar
Wiggums
Posts: 7051
Joined: Thu Jan 31, 2019 7:02 am

Re: Portfolio advise/no experience in investing

Post by Wiggums »

I’m glad that you are on this forum. I feel like it’s important for you to be able to ask questions directly and get clarifications when advice or concepts are not clear.

The balance index fund that you already have is good. I also like that you have some cash. Maybe a little too much cash while you are working. Overall, I think that you are in good shape and that you received very good advice from your ex.
"I started with nothing and I still have most of it left."
Topic Author
Buglady
Posts: 11
Joined: Mon Jan 17, 2022 5:47 pm

Re: Portfolio advise/no experience in investing

Post by Buglady »

chassis wrote: Mon Jan 17, 2022 7:04 pm You are in good shape. Your expenses after Social Security should be less than 4% of what your investments should be at your retirement age. Well done, you should have won the game by that time. "should be" means using average historical market returns to estimate your future investment value.

Agree with the first set of recommendations. I have no opinion on the last set of recommendations (body donation, etc.).
Hi Chassis,
Thanks for the feedback. My ex had already mentioned about the 4% rule of thumb.
Topic Author
Buglady
Posts: 11
Joined: Mon Jan 17, 2022 5:47 pm

Re: Portfolio advise/no experience in investing

Post by Buglady »

calmaniac wrote: Mon Jan 17, 2022 9:11 pm Looks like your plan will work within the constraints you've noted. Your ex has been thoughtful in his advice.

A few thoughts:

• I'm not sure what type of account the Employer Retirement Plan at TIAA is. I can't really comment, given that. Can you move it into an IRA now? See next comment.
• You mention "convert TIAA plan to an annuity". I'd want to understand that better. Why do you need an annuity?
• If you do need an annuity, why are you not taking full advantage of the best annuity out there
-->
waiting to age 70 to take Social Security. There is no annuity available that is going to provide an income stream as efficiently as the money you would get from waiting an additional 3 years for Social Security.
• Long-term care. What are your plans if you are no longer able to care for yourself? Do you have sufficient family and friends to take care of you?
• How long were you married? If married ≥10 years and if ex-husband dies before you, you may be eligible for ex-husband's full Social Security benefit (if greater than yours). Worth talking with someone with Social Security expertise on the details.

Congratulations, you've work hard and have a workable plan in place. Wonderful things ahead!
Thanks calmaniac,



We did looked into the SS options. The benefits applying on my ex-husband record are greater than on my record alone. The SS website says that in this case (applying on your ex record) there is no increase in the benefits past my full retirement age. My benefits are based on his benefits at his FRA, independent of when he applies.



The TIAA retirement plan can be rolled over to an IRA. My ex said that this is not the most urgent thing to do. It can be done later. He also mentioned TIAA has a good annuity and that having an annuity to complement my SS benefit will reduce the need for me to withdraw more frequently from the other investments. He also said that I don’t need to convert all of that investment into an annuity. Just sufficient to cover my fixed expenses with the SS. The rest we can be moved later to Vanguard.



We also discussed long-term care and none of us have any good ideas. I am eager to hear options from this group.
Topic Author
Buglady
Posts: 11
Joined: Mon Jan 17, 2022 5:47 pm

Re: Portfolio advise/no experience in investing

Post by Buglady »

retiredjg wrote: Tue Jan 18, 2022 8:41 am Welcome to the forum. :happy

I don't think you need to be worried about your finances. You have a nice nest egg and it is somewhat larger than needed to sustain your low living expenses....assuming you don't leave so much of it in cash and money market.

Your ex-husband's suggestions are all reasonable. People will have suggested changes here and there.

My suggestion is that a portfolio at 60% stock may be a little too aggressive for your nature after you retire. On the other hand, you may gain enough knowledge in the next 10 years that you will feel perfectly fine with it when that time comes.

Other than getting your cash invested sooner rather than later, many of these decisions can be put off until a later date. There is no need to decide everything right now. You have options, good ones, and you will become more confident about these decisions as you learn more.

The nature of your post and your situation indicates that you may not have a lot of financial experience at this point. This may be scary, but it can easily be changed by just learning a little bit at a time. In a year, you will look back and be amazed at how much progress you have made.

I would suggest that you start with two things. First, get very familiar with the Getting Started area of the Wiki and then move on to other areas of the Wiki as you run into questions. For example, if you wonder how an IRA works, look up IRA in the Wiki. And ask questions here on the forums.

https://www.bogleheads.org/wiki/Getting_started Be sure you don't miss the videos.

Second, a good book to get started learning about finances and investing can be found here. There are many other books as well, I'm just suggesting this one first. https://www.amazon.com/Only-Investment- ... 0544781937 The 2016 edition seems to be the last one available.

After that, tackle one of the Bogleheads' books.

I'm suggesting these books first because they are written in a way that people with little to no experience can easily understand.

If I have mis-judged your situation or experience, please forgive and just consider these are good suggestions for more experienced people as well. :happy
Thanks retiredjg,



My ex also mentioned that I should not leave that much cash just sitting in the bank. He said this is the most important decision I need to make.



I don’t know what to say about the 60% stock. Looks like my TIAA was invested 50% in stocks. My ex said I can have options with other Vanguard funds like Lifestyle or target date (with more or less equity) but they all involve international investments. I am not sure I want anything outside the US. Any thoughts on this ?



I will follow on your recommendation on getting informed through the wiki and the books. My ex said he learned a lot through those basic books, the wiki and posts on this site. He insisted for me to seek feedback before making any decision.
Topic Author
Buglady
Posts: 11
Joined: Mon Jan 17, 2022 5:47 pm

Re: Portfolio advise/no experience in investing

Post by Buglady »

Wiggums wrote: Tue Jan 18, 2022 9:07 am I’m glad that you are on this forum. I feel like it’s important for you to be able to ask questions directly and get clarifications when advice or concepts are not clear.

The balance index fund that you already have is good. I also like that you have some cash. Maybe a little too much cash while you are working. Overall, I think that you are in good shape and that you received very good advice from your ex.
Thanks Wiggums,



Thanks for confirming the advice was good.

I am sure I will come back with more questions and doubts later.
User avatar
retiredjg
Posts: 54082
Joined: Thu Jan 10, 2008 11:56 am

Re: Portfolio advise/no experience in investing

Post by retiredjg »

Buglady wrote: Tue Jan 18, 2022 8:14 pm
retiredjg wrote: Tue Jan 18, 2022 8:41 am Welcome to the forum. :happy

I don't think you need to be worried about your finances. You have a nice nest egg and it is somewhat larger than needed to sustain your low living expenses....assuming you don't leave so much of it in cash and money market.

Your ex-husband's suggestions are all reasonable. People will have suggested changes here and there.

My suggestion is that a portfolio at 60% stock may be a little too aggressive for your nature after you retire. On the other hand, you may gain enough knowledge in the next 10 years that you will feel perfectly fine with it when that time comes.

Other than getting your cash invested sooner rather than later, many of these decisions can be put off until a later date. There is no need to decide everything right now. You have options, good ones, and you will become more confident about these decisions as you learn more.

The nature of your post and your situation indicates that you may not have a lot of financial experience at this point. This may be scary, but it can easily be changed by just learning a little bit at a time. In a year, you will look back and be amazed at how much progress you have made.

I would suggest that you start with two things. First, get very familiar with the Getting Started area of the Wiki and then move on to other areas of the Wiki as you run into questions. For example, if you wonder how an IRA works, look up IRA in the Wiki. And ask questions here on the forums.

https://www.bogleheads.org/wiki/Getting_started Be sure you don't miss the videos.

Second, a good book to get started learning about finances and investing can be found here. There are many other books as well, I'm just suggesting this one first. https://www.amazon.com/Only-Investment- ... 0544781937 The 2016 edition seems to be the last one available.

After that, tackle one of the Bogleheads' books.

I'm suggesting these books first because they are written in a way that people with little to no experience can easily understand.

If I have mis-judged your situation or experience, please forgive and just consider these are good suggestions for more experienced people as well. :happy
Thanks retiredjg,



My ex also mentioned that I should not leave that much cash just sitting in the bank. He said this is the most important decision I need to make.
I agree.

I don’t know what to say about the 60% stock. Looks like my TIAA was invested 50% in stocks. My ex said I can have options with other Vanguard funds like Lifestyle or target date (with more or less equity) but they all involve international investments. I am not sure I want anything outside the US. Any thoughts on this ?
There is little agreement here about how much international stock to hold. The recommendations run from 0% to 50% of your stocks. Nobody knows which of these many choices will do the best. I do not think it is likely that any of the choices will make or break your portfolio either way.

The 60% stock fund suggested is a very good choice for now. I just thought that 60% stock overall might be a little aggressive after you retire, but that does not mean you have to change funds. You could just hold a little bit extra in bonds or cash to bring the ratio down a touch.

I will follow on your recommendation on getting informed through the wiki and the books. My ex said he learned a lot through those basic books, the wiki and posts on this site. He insisted for me to seek feedback before making any decision.
This is a wise suggestion on his part. The more you know and the more you make your own choices and are comfortable with those choices, the less likely it is that he will be unfairly blamed when the market does badly (which it will do).

I really do think you are in fine shape. This portfolio idea is a good solid idea. You also sound like someone who can get this investing stuff figured out - it does not have to be complex or hard. Good investing can be very simple.

Let us know how we can help you make your decisions and implement your plans.
HomeStretch
Posts: 11419
Joined: Thu Dec 27, 2018 2:06 pm

Re: Portfolio advise/no experience in investing

Post by HomeStretch »

Welcome to the forum!

While I use/like Vanguard, consider using Fidelity (or Schwab) instead if there is a local office. If you need to transfer account(s) now or in the future and signature guarantees are required on the transfer form(s), Fidelity (or Schwab) can provide this for you. Additionally, they offer additional services that can make them more of a one-stop shop. For example:
- Fidelity and Schwab offer Cash Management Accounts with free wires and no-fee ATM/debit cards which can substitute for a checking account.
- Fidelity also offers a 2% (on every purchase) cash back credit card with the rewards auto-deposited into a Fidelity account. Schwab has a 1.5% card.

If you haven’t already done so, prioritize updating your estate documents (will, durable power of attorney for financial matters, healthcare rep/directives). Your account/insurance beneficiaries may need to be updated. Update your HIPAA documents with your healthcare providers to name your healthcare representative.
Topic Author
Buglady
Posts: 11
Joined: Mon Jan 17, 2022 5:47 pm

Re: Portfolio advise/no experience in investing

Post by Buglady »

HomeStretch wrote: Wed Jan 19, 2022 8:51 am Welcome to the forum!

While I use/like Vanguard, consider using Fidelity (or Schwab) instead if there is a local office. If you need to transfer account(s) now or in the future and signature guarantees are required on the transfer form(s), Fidelity (or Schwab) can provide this for you. Additionally, they offer additional services that can make them more of a one-stop shop. For example:
- Fidelity and Schwab offer Cash Management Accounts with free wires and no-fee ATM/debit cards which can substitute for a checking account.
- Fidelity also offers a 2% (on every purchase) cash back credit card with the rewards auto-deposited into a Fidelity account. Schwab has a 1.5% card.

If you haven’t already done so, prioritize updating your estate documents (will, durable power of attorney for financial matters, healthcare rep/directives). Your account/insurance beneficiaries may need to be updated. Update your HIPAA documents with your healthcare providers to name your healthcare representative.
Hi Homestrecch,
Thanks for your feedback.
I've already had the benefits you mentioned through my local bank. I will double check whether or not there is a local Fidelity office here in town.
Also, I will finalize my estate planning documents.
Topic Author
Buglady
Posts: 11
Joined: Mon Jan 17, 2022 5:47 pm

Re: Portfolio advise/no experience in investing

Post by Buglady »

retiredjg wrote: Wed Jan 19, 2022 6:53 am
Buglady wrote: Tue Jan 18, 2022 8:14 pm
retiredjg wrote: Tue Jan 18, 2022 8:41 am Welcome to the forum. :happy

I don't think you need to be worried about your finances. You have a nice nest egg and it is somewhat larger than needed to sustain your low living expenses....assuming you don't leave so much of it in cash and money market.

Your ex-husband's suggestions are all reasonable. People will have suggested changes here and there.

My suggestion is that a portfolio at 60% stock may be a little too aggressive for your nature after you retire. On the other hand, you may gain enough knowledge in the next 10 years that you will feel perfectly fine with it when that time comes.

Other than getting your cash invested sooner rather than later, many of these decisions can be put off until a later date. There is no need to decide everything right now. You have options, good ones, and you will become more confident about these decisions as you learn more.

The nature of your post and your situation indicates that you may not have a lot of financial experience at this point. This may be scary, but it can easily be changed by just learning a little bit at a time. In a year, you will look back and be amazed at how much progress you have made.

I would suggest that you start with two things. First, get very familiar with the Getting Started area of the Wiki and then move on to other areas of the Wiki as you run into questions. For example, if you wonder how an IRA works, look up IRA in the Wiki. And ask questions here on the forums.

https://www.bogleheads.org/wiki/Getting_started Be sure you don't miss the videos.

Second, a good book to get started learning about finances and investing can be found here. There are many other books as well, I'm just suggesting this one first. https://www.amazon.com/Only-Investment- ... 0544781937 The 2016 edition seems to be the last one available.

After that, tackle one of the Bogleheads' books.

I'm suggesting these books first because they are written in a way that people with little to no experience can easily understand.

If I have mis-judged your situation or experience, please forgive and just consider these are good suggestions for more experienced people as well. :happy
Thanks retiredjg,



My ex also mentioned that I should not leave that much cash just sitting in the bank. He said this is the most important decision I need to make.
I agree.

I don’t know what to say about the 60% stock. Looks like my TIAA was invested 50% in stocks. My ex said I can have options with other Vanguard funds like Lifestyle or target date (with more or less equity) but they all involve international investments. I am not sure I want anything outside the US. Any thoughts on this ?
There is little agreement here about how much international stock to hold. The recommendations run from 0% to 50% of your stocks. Nobody knows which of these many choices will do the best. I do not think it is likely that any of the choices will make or break your portfolio either way.

The 60% stock fund suggested is a very good choice for now. I just thought that 60% stock overall might be a little aggressive after you retire, but that does not mean you have to change funds. You could just hold a little bit extra in bonds or cash to bring the ratio down a touch.

I will follow on your recommendation on getting informed through the wiki and the books. My ex said he learned a lot through those basic books, the wiki and posts on this site. He insisted for me to seek feedback before making any decision.
This is a wise suggestion on his part. The more you know and the more you make your own choices and are comfortable with those choices, the less likely it is that he will be unfairly blamed when the market does badly (which it will do).

I really do think you are in fine shape. This portfolio idea is a good solid idea. You also sound like someone who can get this investing stuff figured out - it does not have to be complex or hard. Good investing can be very simple.

Let us know how we can help you make your decisions and implement your plans.

Thank again for you feedback.
Topic Author
Buglady
Posts: 11
Joined: Mon Jan 17, 2022 5:47 pm

Re: Portfolio advise/no experience in investing

Post by Buglady »

This is an update of what I have done in the past few weeks.

My ex-husband helped me to set up an account at Vanguard, to transfer and invest the cash.

Current situation:



Vanguard Taxable account: 290K in VBIAX

TIAA IRA: 7K in a variety of mutual funds

TIAA Retirement: 320K in a variety of mutual funds

Local Bank CD: 35K

Local Bank Checking and Money Market: 15K



My ex-husband set the VBIAX cost basis to be specID (he says it may give me flexibility later) and automatic reinvestment of dividends and capital gains (he said this can be changed later too).

According to him this is a hand-free approach, but that VBIAX generates capital gains that are taxable but, in his opinion, I may never pay taxes on dividends.

He thinks this is the best hands-free without international for my situation.



Next steps:

Rollover IRA to Vanguard (he recommended first to reduce the number of funds I currently hold). Invest in VBIAX at Vanguard after transfer.
See what investments are available in the TIAA retirement account and simplify.
Decide what to do with CD in December.
Finalize estate planning documents


Any suggestions/ comments would be highly appreciated .
Thank you.
Last edited by Buglady on Fri Feb 11, 2022 10:49 am, edited 1 time in total.
User avatar
retiredjg
Posts: 54082
Joined: Thu Jan 10, 2008 11:56 am

Re: Portfolio advise/no experience in investing

Post by retiredjg »

You are doing a great job. Keep it up.
Topic Author
Buglady
Posts: 11
Joined: Mon Jan 17, 2022 5:47 pm

Re: Portfolio advise/no experience in investing

Post by Buglady »

retiredjg wrote: Fri Feb 11, 2022 10:44 am You are doing a great job. Keep it up.
Thank you for the support.\

What about the cost basis and VBIAX capital gains comments from my ex?
HomeStretch
Posts: 11419
Joined: Thu Dec 27, 2018 2:06 pm

Re: Portfolio advise/no experience in investing

Post by HomeStretch »

Great progress!

In a Vanguard Taxable account, I agree with using “Specific Cost” as your cost basis method and automatically reinvesting dividends and capital gain distributions. You can always change your settings in the future to not reinvest dividends if/when you need the cash from the dividend (for example, for spending in retirement).

If you haven’t already done so, you can establish a link in your Vanguard online account between your Vanguard account(s) and your bank account to allow you to transfer funds electronically.

As part of your estate planning with your estate attorney you should receive advice on how to set your beneficiaries for each account at your bank, Vanguard and TIAA as well as any life insurance policy. If you name a beneficiary on a financial account, the account is considered POD (payable on death) or TOD (transfer on death). POD/TOD accounts and TOD car/house titles pass outside of your Will.

Unless something has changed, Vanguard will not recognize your attorney-prepared power-of-attorney even if your state law requires them to. You will need to complete Vanguard’s agent authorization form (available in your online account) and have the form notarized (which you can do with your attorney at the same time you execute your estate documents). Try to get the Vanguard IRA set up soon so you have an account # for the agent form so you can do the Vanguard agent authorization paperwork just once.

Yes, VBIAX will generate annual dividends and perhaps capital gains distributions. You will receive a Form 1099 each year that must be reported on your income tax return(s). How much tax you pay, if any, will depend on your taxable income. No way to avoid this.

Do you prepare your own tax return(s) or do you use a tax preparer?
User avatar
retiredjg
Posts: 54082
Joined: Thu Jan 10, 2008 11:56 am

Re: Portfolio advise/no experience in investing

Post by retiredjg »

Buglady wrote: Fri Feb 11, 2022 11:25 am
retiredjg wrote: Fri Feb 11, 2022 10:44 am You are doing a great job. Keep it up.
Thank you for the support.\

What about the cost basis and VBIAX capital gains comments from my ex?
I think he has given you the right guidance on these things.
Topic Author
Buglady
Posts: 11
Joined: Mon Jan 17, 2022 5:47 pm

Re: Portfolio advise/no experience in investing

Post by Buglady »

retiredjg wrote: Sat Feb 12, 2022 7:50 am
Buglady wrote: Fri Feb 11, 2022 11:25 am
retiredjg wrote: Fri Feb 11, 2022 10:44 am You are doing a great job. Keep it up.
Thank you for the support.\

What about the cost basis and VBIAX capital gains comments from my ex?
I think he has given you the right guidance on these things.
Thank you for your feedback.
Topic Author
Buglady
Posts: 11
Joined: Mon Jan 17, 2022 5:47 pm

Re: Portfolio advise/no experience in investing

Post by Buglady »

retiredjg wrote: Fri Feb 11, 2022 10:44 am You are doing a great job. Keep it up.
Thank you .
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