Financial Independence Economist article: "Returns on stocks in 2018 were down across the board. For long-term investors that is good news." |
- Economist article: "Returns on stocks in 2018 were down across the board. For long-term investors that is good news."
- What does healthcare realistically look like after Medicare?
- Daily FI discussion thread - January 04, 2019
- How to value Pension accrual?
- Strategy for FIRE with own/parental assets (plus tax avoidance if you're up for it)?
- I have access to an After-Tax 401k option, but not using it because of nerves
- Weekly FI Frugal Friday thread - January 04, 2019
- How do you work out your coast FIRE numbers?
- Does anyone have any experience with Justworks/Slavic401k for their 401(k)?
- After accumulation, the end, or is it? Paperwork, records, audits, etc
- Good alternative to VTSAX if I don't have 3K minimum?
- My method for calculating savings rate: please set me straight
- Consolidating Accounts?
- What finance, investing, stocks or financial news subreddits would you recommend?
- Net Worth by Age (percentile)
- The Coming Retirement Crisis
| Posted: 04 Jan 2019 12:10 AM PST The writer covers the differing psychological reactions to falling stock prices between short-term and long-term investors. I liked the analogy to "landlords" and "tenants" in terms of housing prices. For those at the beginning of their FI journey, cheering rising stock prices is like "a commuter who rejoices after the price of gas increases, simply because his tank contains a day's supply". Good to keep in mind. [link] [comments]  |
| What does healthcare realistically look like after Medicare? Posted: 04 Jan 2019 10:13 AM PST I'm in my mid-40's and planning to early retire around the age of 52. I've already got 25x expenses saved but want to keep working for numerous reasons. Retiring at 52 gives me like 13 years until Medicare and 15 years until Social Security. I know healthcare is going to be crazy expensive for those 13 years until Medicare. I'm aware of the 4x Federal Poverty Limit ACA "hack" but who knows what the landscape will look like in 8 years? Realistically speaking, once I become eligible for Medicare, do my annual medical expenses drop significantly? I assume Medicare is a bare bones thing and I'll want some type of supplemental plan(s)? [link] [comments]  |
| Daily FI discussion thread - January 04, 2019 Posted: 04 Jan 2019 03:08 AM PST Please use this thread to have discussions which you don't feel warrant a new post to the sub. While the Rules for posting questions on the basics of personal finance/investing topics are relaxed a little bit here, the rules against memes/spam/self-promotion/excessive rudeness/politics still apply! Have a look at the FAQ for this subreddit before posting to see if your question is frequently asked. Since this post does tend to get busy, consider sorting the comments by "new" (instead of "best" or "top") to see the newest posts. [link] [comments]  |
| Posted: 04 Jan 2019 11:42 AM PST Hi All - Perhaps an ignorant question but I would like your take on how to value my pension in a total compensation calculation. I'm one of the lucky few whose current employer both pays for a 5% 401(k) match and also a pension. The pension accrues as follows: 1% of your highest pay multiplied by total years of employment. Ex. Highest Salary during tenure is $300k, then $3,000 times the years of service. Pays out at age 65. 3% annual increase. How would I compare this benefit against another job with higher salary but does not offer a pension? Would you just calculate the net present value of the yearly accrual? Thanks [link] [comments]  |
| Strategy for FIRE with own/parental assets (plus tax avoidance if you're up for it)? Posted: 04 Jan 2019 12:59 PM PST Hello everyone! Posting from throwaway for obvious reasons. My main account is over 11k karma so I don't want to make this public to those who know me. I've been reading and thinking about FIRE for a while now and this is the best resource so far. Your advice and posts are always very thoughtful and informational. I want to join the fray but need some advice as I haven't seen a similar situation yet. I'm not sure where to start so let me layout our sitch and have you guys/gals advise if possible. My elderly mother (still of sound mind) just got divorced and moved here from another state. I'm her sole heir and she's begun gifting my family $15k/ea - total of $45k/yr. She wants to do this consistently going forward. This has us thinking of having my wife cut back on her corporate job (she makes around $110k/yr) to spend more time with me and my daughter who is 10 right now. I run a business that hasn't yet paid me anything but does support some of our household expenses and provides other benefits and is starting to show decent profits. Mom has significant assets and wants to share as long as there's enough for her to live on. Her income including SS, inherited IRA RMD, traditional IRA RMD, and trust RMD is around $175k/yr and she rents in an independent living facility so there's literally zero tax writeoffs. We would like to find some, or at least keep some of that money "in the family" rather than in the gov't's hands. We are early 40s and have thus far saved up around $900k (this is after all the recent losses) in investments. Our home is probably worth $750k and we carry a $300k balance. We have $2M in life insurance so our daughter will be well situated if we die. We receive around $700-900/mo in income from real estate my grandfather owned and passed down. Our utilities and living expenses are quite low - including mortgage, taxes, insurance, etc we can easily live on $4k/mo or so all in - probably less but we aren't "hard core" to where we never eat out, etc. I almost died in a car wreck in my 20s and we realize life can be short and want to enjoy now and not be misers now for a wealthy life later. Mom's assets include a $1.6M trust (she can't touch the corpus - that is mine once she passes according to the docs) where she gets $75k/yr from for living expenses. Her income from the same properties I have is 4.5x as much or $38-48k/yr. This goes into the $1.6M before the $75k is paid out so the $1.6M has been growing. She has another $1M or so in IRAs where she has to take min. distributions each year and $2k/mo in SS so her income is very high. She's gifting $45k/yr but even after that she has plenty left so that goes into a trust she set up for my benefit, currently at around $250k balance and growing steadily. She has also mentioned paying for my daughter's college outright which would be a big help. Lastly my wife's parents are leaving her some unknown amount of cash (let's call it zero) and two properties, together worth around $800k. We could rent them out later or sell - but that's later and not considered here. Sorry so long but my questions are: 1) How to maximize FAMILY income and assets for lowest taxes and also possible FIRE or partial FIRE (I enjoy working and would continue part time as I do now and my wife would probably like to keep doing something also)? If my wife goes half time that would be $50-60k/yr, plus whatever I make, plus the minimal property income, plus the $45k/yr gift (more if there are other ways) - we could forseeably maintain this for a long time. 2) Suggestions for wealth transfer before death for mom to help us achieve FIRE and/or help her reduce taxes? I've seen 529 contributions, paying for my daughter's private school tuition and our medical expenses directly, and gifting over the exclusion amount with a gift tax form filled out - early inheritance is what they call this. 3) What else am I missing here? Our financial advisor thinks medical expenses and college costs (my wife wants to prepare for the most expensive schools in the USA) are the two biggest things keeping us from FIRE right now but if mom is willing to help with those, maybe we're ready now? I guess I'm feeling like I have a decent grasp of things but want the group to reassure and assess to help avoid "oops" type situations. I'm sure I forgot tons of details so please ask if anything is unclear. [link] [comments]  |
| I have access to an After-Tax 401k option, but not using it because of nerves Posted: 04 Jan 2019 01:23 PM PST Between my husband and I we are fully funding 2 roth IRAs and my traditional 401k (his job does not offer one). This is the first year that I feel comfortable contributing more than the (now) max $31000 we are eligible for and debating between a normal brokerage account or signing up for the After-Tax portion of my 401k to do a mega backdoor roth. I understand that for the tax savings it would be better to do the After-Tax, but it just seems much more intimidating. I need to ask the right questions of my provider, and make sure I roll everything over correctly and in the right time-frame, etc. My investing strategy has been very much a "set-it-and-forget-it" so it all just seems like more work than I'm comfortable with. Is the tax savings worth it? Am I making a mountain out of a mole-hill? What have your experiences been with this type of account? [link] [comments]  |
| Weekly FI Frugal Friday thread - January 04, 2019 Posted: 04 Jan 2019 03:08 AM PST Please use this thread to discuss how amazingly cheap you are. How do you keep your costs low? How do become frugal without taking it to the extremes of frupidity? What costs have you realized could be cut from your life without pain? Use this weekly post to discuss Frugality in general. While the Rules for posting questions on the basics of personal finance/investing topics are more relaxed here, the rules against memes/spam/self-promotion/excessive rudeness/politics still apply! Since this post does tend to get busy, consider sorting the comments by "new" (instead of "best" or "top") to see the newest posts. [link] [comments]  |
| How do you work out your coast FIRE numbers? Posted: 04 Jan 2019 03:14 PM PST So my understanding is coast fire number is the amount you need at which with no new funds added will achieve your retirement goals when you get there at say 60. What's the best way to calculate this and with what assumptions (eg inflation, return etc). So say I'm 35, I want to retire at 60 with 20k a year adjusted for inflation. What amount would I need right now to achieve this. [link] [comments]  |
| Does anyone have any experience with Justworks/Slavic401k for their 401(k)? Posted: 04 Jan 2019 02:21 PM PST I may be switching from Schwab to Justworks in the near future and am wondering how good an administrator they are. According to some of their literature, the 401(k) is affiliated with Slavic401k--I'm not sure I totally understand the nature of that relationship. My main question is whether or not either of these providers allow for in-service after-tax withdrawals. My current provider (Schwab) allows this and it's been a blessing, allowing me to do a mega-backdoor Roth over the last few years. I'm hesitant to give this up, but I may have no choice. Thanks in advance for any insight. [link] [comments]  |
| After accumulation, the end, or is it? Paperwork, records, audits, etc Posted: 04 Jan 2019 08:16 AM PST So I'm well into my accumulation phase and I was thinking about records and paperwork. I really don't do a good job looking at my accounts' paperwork, I just let them accumulate with automatic investments and occasionally rebalancing. I was thinking, what if the numbers go wrong somehow or somewhere? Or if the IRS wants to audit me in the future? All I can really do is give my login and hope everything is there. So what do you do for records management? Seems like I'm sitting on a headache waiting to happen, thinking I might want to get out in front of it before being blindsided. [link] [comments]  |
| Good alternative to VTSAX if I don't have 3K minimum? Posted: 04 Jan 2019 02:13 PM PST Would like to invest in VTSAX, but I don't have the 3K required minimum. I'm closer to $1000. What would be a good alternative for me? Thanks [link] [comments]  |
| My method for calculating savings rate: please set me straight Posted: 04 Jan 2019 12:14 PM PST I calculated total spending and savings rate for 2018, and this is my first time doing either. The formula I used for savings rate is: (Net Income - Total Spending) / Net Income I defined "Net Income" as the actual take home pay (i.e., literally what my 26 paychecks added up to in 2018). This is obviously after all taxes, health care premiums, 401K contribution, everything that gets taken out of my checks, etc... My questions:
Thanks for any insight. [link] [comments]  |
| Posted: 04 Jan 2019 09:59 AM PST Before I read more about investing in general and FIRE in particular, I opened a Roth IRA at Vanguard and put some money in it and then opened a taxable account (just cause, I guess). The taxable account has 1 share of VOO and nothing else. What are the ramifications, if any, of selling my positions in the taxable account and then using that cash to finish padding out my 2018 Roth? The taxable account was funded with money I had already paid income tax on. Additionally, the taxable account (along with all of my accounts, really) are in the negative % returns. So there should no capital gains tax to worry about right? We're talking ~$200 total and ~$21 in losses. The other thing would be wash sales, but I'm not planning on claiming the losses......so is it as simple as selling out and then moving that cash into the Roth? Also, since this is all within Vanguard, is there a better/easier way to do it than selling and transferring to my bank and then transferring back to the Roth? [link] [comments]  |
| What finance, investing, stocks or financial news subreddits would you recommend? Posted: 04 Jan 2019 02:03 AM PST TL;DR: Other subreddits are bad for gathering information and having a good mindset, what subreddit would you recommend? An important part of financial independence is to not only know the technical details of the market, but also knowing what is happening and how people are reacting to it currently. If you got a lot of money, you should know what the market is up to. This is not about trying to "time" the market, it is about having proper information about what is happening so we don't have wrong information and wrong mindsets about how to view what the market it doing. Other subreddits like /r/stocks and /r/investing have come victim to what I call the "overpopulation effect", where quantity of posts and comments have gone up, but quality of posts and comments have gone down (this effect happens everywhere in general, like FB or Instagram). It happened to /r/bitcoin, where it was an actually decent subreddits to not only get technical information about Bitcoin, but also realistic speculation, which was not all about "moonboys". It happened to /r/cryptocurrency as it became more popular a lot of manipulation, botting and shilling started happening (I can't back that up with proof, but from my experience I could really see the difference) it became another "shiller and thriller" crypto subreddit. Now as the bullmarket happened, more general subreddit like /r/stocks and /r/investing have gained a lot of popularity and with that popularity came a lot of newcomes which resulted in less quality more quantity. Would it be possible to have a discussion about what subreddits are worth subscribing/having a multi of. Or in general what good news sources would you recommend? My youtube channels which i like ATM: ThemoneyGPS, Gregory Mannarino, GoldSilver(Mike Maloney), Blackstone Intelligence Network, Ready Set Crypto. [link] [comments]  |
| Posted: 03 Jan 2019 11:39 PM PST How did your networth percentile by age change as you got older? Did it increase? Decrease? Where did it get tough to increase? Currently at 96.27% @ age 29 with $355,000 net worth From age 25-29 my percentile has gone from 30% to 96.27%... hoping to reach 99th percentile in three years, or increase 1 percentile every year. I use this calculator: https://www.shnugi.com/networth-percentile-calculator/ Cheers. [link] [comments]  |
| Posted: 03 Jan 2019 04:58 PM PST I just watched this the other day and have since watched it two more times. With what seems like an impending downturn, maybe this is more relevant than ever. I'd be curious to know what the FI/RE community thinks of his main points. [link] [comments]  |
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