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KillHour posted:
Certainly feel free to poke around to the different target date funds from various platforms and see how they are breaking down their ratios. They all honestly have a pretty similar performance, so you're probably not going to go wrong if you follow them or even do an average of their investment splits.
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Feb 24, 2023 15:17
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I've decided this year is time to get my retirement accounts off the ground. Almost all of my banking is done through Chase, does that make it worth it to use them for my Roth IRA? I understand that many brokers offer effectively equivalent investment products except for things outside my risk knowledge like margin and options. Is there a reason for me not to use the same people I bank with?
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Feb 24, 2023 15:58
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TheLawinator posted:I've decided this year is time to get my retirement accounts off the ground. Almost all of my banking is done through Chase, does that make it worth it to use them for my Roth IRA? I understand that many brokers offer effectively equivalent investment products except for things outside my risk knowledge like margin and options. Is there a reason for me not to use the same people I bank with? Their IRA looks like it has an annual fee. Just go with one of the free ones in the OP: Vanguard, Fidelity, or Schwab.
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Feb 24, 2023 16:13
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Banking and investing serve different purposes, and the best place for one role will basically never be the best at the other task. Same goes for credit cards. People so often just get whatever the bank who holds their money offers, because they imagine it will be easier somehow. But it isn't, for either investment accounts or CCs. The process for moving money around is exactly the same regardless of who your hub bank is. Siloing everything in one place just means you get worse products in exchange for... no gain that I can think of, honestly. Even if it's a seemingly small amount, don't throw away money out of loyalty to financial companies. They sure as poo poo won't be loyal to you. And if you're online enough to be on these forums, then you're online enough that one extra site to log into shouldn't be a big deal in TYOOL 2023. If it is, get a password manager.  (I like 1Password)
Unsinkabear fucked around with this message at 17:26 on Feb 24, 2023 |
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Feb 24, 2023 17:24
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raminasi posted:Their IRA looks like it has an annual fee. Just go with one of the free ones in the OP: Vanguard, Fidelity, or Schwab. Well, if I had a couple hundred grand in an account already that wouldn't be a problem, but it's my first year contributing so chucking a quarter of the interest I would get in a year is obviously dumb. Thanks for picking that out immediately. Vanguard is basically the only folks I've heard of in regular conversation so I might as well max out their target fund for the year. Besides that I might set up another account to mimic the same thing unless I can convince my company that a 401k even without matching for the first year or two is a good idea. It's a family business and we're still recovering from the pandemic. Getting the setup out of the way now would pave the way for matching later.
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Feb 24, 2023 17:24
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TheLawinator posted:I've decided this year is time to get my retirement accounts off the ground. Almost all of my banking is done through Chase, does that make it worth it to use them for my Roth IRA? I understand that many brokers offer effectively equivalent investment products except for things outside my risk knowledge like margin and options. Is there a reason for me not to use the same people I bank with? I'd also look at another bank like Ally for a high yield savings account and checking. Chase has, quite frankly, really piss poor interest rates. I only keep an account there open because it's a joint account that was opened with my parents when I was a kid, and it makes it easy to transfer funds in the family. Other than that and my mortgage I left Chase behind long ago.
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Feb 24, 2023 17:29
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Nitrousoxide posted:I'd also look at another bank like Ally for a high yield savings account and checking. Chase has, quite frankly, really piss poor interest rates. I only keep an account there open because it's a joint account that was opened with my parents when I was a kid, and it makes it easy to transfer funds in the family. Other than that and my mortgage I left Chase behind long ago. Chase has my CC, direct deposit account, and mortgage. My intention for this year is to have most of my reserves in a CD at around 4.5-4.75 until I figure out what to do with it long term. Looking at HYSAs, I already have a CC with Discover and they've got 3.5% with a bonus of up to 200$, has anyone around here used them? Ooh Ally has an 18 month CD at 5%, that's nice. Edit: UFB has a savings rate of 4.55. They're a part of Axos bank, is that a good thing or a bad thing? 4.55 with no lock in or fees is hard to say no territory. TheLawinator fucked around with this message at 17:51 on Feb 24, 2023 |
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Feb 24, 2023 17:45
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Subvisual Haze posted:Conventional Wisdom for Maximum Aggression: For the last 20 years, I have only done 10% to Bonds because I felt the whole "Bonds are safer" conventional wisdom no longer made sense given how low interest rates have been. I might change that if rates go higher, but I still can't justify a bond fund in a rising interest rate environment.
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Feb 24, 2023 18:07
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TheLawinator posted:Chase has my CC, direct deposit account, and mortgage. My intention for this year is to have most of my reserves in a CD at around 4.5-4.75 until I figure out what to do with it long term. Looking at HYSAs, I already have a CC with Discover and they've got 3.5% with a bonus of up to 200$, has anyone around here used them? I believe Ally also has no penalty CD withdrawals too (though you have to withdraw the entire chunk if you need to do even a small portion). This should make that 18 month CD a low risk of locking your money up when you might need it.
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Feb 24, 2023 18:09
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TheLawinator posted:Chase has my CC, direct deposit account, and mortgage. My intention for this year is to have most of my reserves in a CD at around 4.5-4.75 until I figure out what to do with it long term. Looking at HYSAs, I already have a CC with Discover and they've got 3.5% with a bonus of up to 200$, has anyone around here used them? * Taps It may be also worth looking into $SGOV for your emergency funds if you are willing to go a little less liquid to max them gains. If you fully lock your reserves up in a CD, they aren't your reserves anymore. Doesn't seem worth it when there are good middle of the road options like SGOV or money markets. E: forgot about withdrawal exceptions like the Ally one, that might be fine. Do you forfeit all interest when you do that, though, or does it prorate? Unsinkabear fucked around with this message at 18:24 on Feb 24, 2023 |
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Feb 24, 2023 18:16
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Nitrousoxide posted:I believe Ally also has no penalty CD withdrawals too (though you have to withdraw the entire chunk if you need to do even a small portion). This should make that 18 month CD a low risk of locking your money up when you might need it. The no penalty version is 4% at 11 months, the penalty for the 5% 18 months is 2 months of interest, which isn't bad if you need it. I'm feeling like 5% is the best offer out there for a CD unless things get weirder. I'll still maintain a full emergency fund in a savings account though. That UFB savings account at 4.55 will get an extra look.
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Feb 24, 2023 18:36
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daslog posted:For the last 20 years, I have only done 10% to Bonds because I felt the whole "Bonds are safer" conventional wisdom no longer made sense given how low interest rates have been. I might change that if rates go higher, but I still can't justify a bond fund in a rising interest rate environment. This suggests you think can predict interest rates better than the market can. Rising rates are *good* for bond fund holders, if you hold the funds for the appropriate amount of time (as long or longer than the duration of the fund). Decreases in price in the short term are more than offset by the increased dividends over the longer term. Here's an example from this Bogleheads thread  Black = no change in rates, green = 2% increase in rates, red = 4% increase in rates
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Feb 24, 2023 18:42
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I read the thread. Does this page reflect the returns of the fund they are discussing? If it does, I don't need how these returns could justify any investment. https://investor.vanguard.com/investment-products/mutual-funds/profile/vbtlx#performance-fees
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Feb 24, 2023 19:26
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The Bogleheads thread is about a theoretical bond fund similar to VBTLX, yes. If you are focusing in on the 1 year losses, sure, that fund has had a bad year. But, it is currently yielding 4.23%, which is above its 22 year return since inception of 3.33%. If you were trying to time the market for maximum long term returns, it seems like now would be the time to get in, not some hypothetical future date where prices have already risen and yields have fallen (and bond yields will almost certainly fall before any fed rate cuts, you cant just wait until then to buy). Bond funds aren't for everyone though - if you dont want to invest in one, dont. 100% equity is a valid option, though it involves more risk drk fucked around with this message at 21:05 on Feb 24, 2023 |
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Feb 24, 2023 20:17
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daslog posted:For the last 20 years, I have only done 10% to Bonds because I felt the whole "Bonds are safer" conventional wisdom no longer made sense given how low interest rates have been. I might change that if rates go higher, but I still can't justify a bond fund in a rising interest rate environment. William Bernstein kind of convinced me that long and intermediate bonds are a fairly speculative asset, more "stock like" in their behavior due to the long length to expiration. As such their resale value in the secondary market can vary substantially as rates change, and this is turn will be reflected in NAV of bond funds holding those assets. Thus they're really a gamble on future changes in interest rates (if rates go up, previously purchased long bond at lower rates is now less valuable compared to new issues etc), which are challenging/impossible to predict. I do think that at this moment longer bonds are a more attractive buy than they were in the weird 2008-2021 stretch of near zero rates. Bernstein gives the example that if you held long term treasuries between the years 1940-1980 you would have lost 2/3 of the value, a brutal prospect. However if you timed the peak of Volker Shock rates right (horror at timing) and bought long term bonds in 1982 you would have had an exceptional return as rates kept consistently dropping for the next several decades. A big issue is that we use "bond" as kind of a grab bag for several very different types of fixed income. Quality corporate, junk corporate, Munis, Treasuries, TIPS, i-bonds. And then all of the above of different durations. And then you need to consider the difference between buying individual bonds vs. a bond fund. I'm not sure the thesis behind a total bond index fund is quite as proven or easy to execute as stock market index. A lot of individual bonds are lightly traded, and thus there might be a long term advantage in an actively managed bond fund assuming the manager knows what they're doing and keeps expenses low (of which even Vanguard offers many). That said, there is certainly an argument to be made for simple simplicity in buying a total bond index.
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Feb 24, 2023 20:21
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drk posted:Bond funds aren't for everyone though - if you dont want to invest in one, dont. 100% equity is a valid option, though it involves more risk - the bond market is down over the last year, but the stock market is down even more. bolded part not actually true (unless talking only 'short term' bonds). really bad 1-year total return for bonds: https://stockcharts.com/freecharts/perf.php?SPY,VTI,VT,VXUS,BND,BNDX,TLT,GOVT,LQD&n=252&O=011000
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Feb 24, 2023 20:26
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pmchem posted:bolded part not actually true (unless talking only 'short term' bonds). really bad 1-year total return for bonds: Yes, you are right, apparently I cant read graphs today. Either way, my point was that the stock market is more volatile than the bond market. There certainly are years when fixed income does better than equity. 
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Feb 24, 2023 21:11
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yeah. btw blackrock has their own interactive, monthly updated version of that chart you may like: https://www.blackrock.com/corporate/insights/blackrock-investment-institute/interactive-charts/return-map
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Feb 25, 2023 07:25
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Is it typical that the target date funds for a 401K at a Fortune 500 company would have 0.3-0.4% fees? Feels like someone is making a lot of money just to rebalance since the underlying index funds are like 0.02-0.04%.
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Feb 25, 2023 14:46
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smackfu posted:Is it typical that the target date funds for a 401K at a Fortune 500 company would have 0.3-0.4% fees? Feels like someone is making a lot of money just to rebalance since the underlying index funds are like 0.02-0.04%. The target dates at my (large) company 401k are all 0.6% lol. Thankfully they have small, large and international index funds cap with a 0.04% ratio , so I can use those. To add to it: it’s run by Fidelity, and they def have 2 of each of the small cap, large cap, etc. one is the index fund, and the other one is a Fidelity managed fund that is 0.7%. And the inline setup and wording def attempts to push you to go with the expensive target date or managed funds. Smh.
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Feb 25, 2023 15:17
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The 401k plan at my Fortune 500 employer offers BlackRock LifePath Index target date funds and they only charge 0.083%. Vanguard charges 0.08% for their TDFs to retail investors so that's pretty good. I haven't worked at another Fortune 500 company before so have no other points of comparison.
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Feb 25, 2023 16:22
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I just got my tax refund and have about $5k of cash sitting unallocated. I maxed my Roth IRA already, and normally I would just chuck any extra cash in the roboadvisor and forget about it. However, with inflation looking to run a bit hotter than anticipated I'm wondering if I should push the cash into those I Bonds. I've accumulated about $20k in I bonds over the past few years with the idea that I can gradually store a large share of my emergency fund in those. But any new investment would be for the sake of investment. If I bonds are a good idea now, what about timing? The rate gets adjusted in 2 months (which will be presumably higher due to better inflation data and the fed funds rate). If I were to buy now my bonds wouldn't get that new rate until September. Should I just stick this cash in a HYSA until the interest rates are adjusted in may?
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Feb 25, 2023 16:50
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sparkmaster posted:Should I just stick this cash in a HYSA until the interest rates are adjusted in may? Based on your circumstances: yes. Fingers crossed the I bond fixed rate notches upward too!
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Feb 25, 2023 16:58
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The date to wait for on I Bonds is April 12th, when the inflation component for the next period should be fully known, but the old rate is still available to purchase. The variable rate seems likely to be lower in the next period - there was zero net inflation in the first 3 months of the measurement period, so at this point, only January's inflation is contributing any return to I bond holders next period. 
drk fucked around with this message at 00:58 on Feb 26, 2023 |
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Feb 26, 2023 00:55
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smackfu posted:Is it typical that the target date funds for a 401K at a Fortune 500 company would have 0.3-0.4% fees? Feels like someone is making a lot of money just to rebalance since the underlying index funds are like 0.02-0.04%. Just for another data point, at my current F100 company the state street target date funds we have are 0.047% expense ratio. Our S&P 500 fund is 0.0145% Our 401k plan is fairly generous so I assume the company is covering most of the fees and fidelity is not marking up the fund ER’s if that’s even a thing.
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Feb 26, 2023 08:54
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We have a pretty big delta from TDFs to indices. I think it’s like 400-500 bps. The administrating company has to make money somehow. We are not F500 though.
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Feb 26, 2023 14:29
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Another data point from a F500 company - 23 investment options in total including all the TDFs. Highest gross expense ratio for a plan option is 0.995% TDFs: Vanguard, 0.065% Indices: S&P 500, 0.01% Russell 2000, 0.01% ACWI EX US, 0.035% US Bond, 0.025% ~Mid-Cap1, 0.55% ~Mid-Cap2, 0.95% The company's plan recently changed from TDFs that ranged between 0.5% - 0.6% to the lower ER Vanguard TDFs.
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Feb 26, 2023 15:23
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Subvisual Haze posted:Conventional Wisdom for Maximum Aggression: I'm in the process of rebalancing an expensive managed target date fund into separate less expensive funds. How does this sound? 70% - FID 500 INDEX (FXAIX) - ER 0.015% 20% - FID GLB EX US IDX (FSGGX) - ER 0.055% 10% - FID US BOND IDX (FXNAX) - ER 0.025%
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Feb 27, 2023 13:08
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zaurg posted:I'm in the process of rebalancing an expensive managed target date fund into separate less expensive funds. How does this sound? Tase your balls.
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Feb 27, 2023 16:29
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zaurg posted:I'm in the process of rebalancing an expensive managed target date fund into separate less expensive funds. How does this sound? assuming those ER's are correct, and you have a > 1 decade time horizon... seems fine? CubicalSucrose posted:Tase your balls. ok, now that the thread has that totally expected response out of the way, I want to point out a recent BFC rules update to people who perhaps haven't read it: https://forums.somethingawful.com/showthread.php?threadid=4021411#post529707601 pmchem posted:speaking of which... RULES UPDATE: so that boring rear end portfolio question is his BFC post for February. let's see if, perhaps, we can just treat a boring straightforward post with an equally boring straightforward response and continue on with life. if zaurg has to abide by BFC rules, responses to him (going forward...) will be met with the same standard.
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Feb 27, 2023 16:36
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pmchem posted:assuming those ER's are correct, and you have a > 1 decade time horizon... seems fine? Oh good to know. zaurg posted:I'm in the process of rebalancing an expensive managed target date fund into separate less expensive funds. How does this sound? Yeah that seems reasonable I guess? Which target date fund are you looking at decomposing? Given my recollection of how old you are, seems a little heavier equity-wise than you might want, but not unreasonable assuming you're actually willing to rebalance every few years.
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Feb 27, 2023 16:45
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Double-post I wasn't intentionally trying to bait a rules-break with my question, it's legitimately what comes to mind first when considering what was asked.
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Feb 27, 2023 16:47
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CubicalSucrose posted:Double-post I wasn't intentionally trying to bait a rules-break with my question, it's legitimately what comes to mind first when considering what was asked. yeah man it's all good. keeping to the calendar restrictions is on zaurg. there's no "you can't ask him questions" or other special rules. just normal BFC rules for all (except the calendar thing for zaurg).
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Feb 27, 2023 16:50
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CubicalSucrose posted:Oh good to know. I'm guessing one of the expensive Fidelity Target date funds. Having the nearly identically named Fidelity Freedom 20XX and Fidelity Freedom Index 20XX funds with wildly different expense ratios (one is 0.12% and one is 0.75%) should be illegal. The more expensive one does the dumb thing of putting people in several dozen different assets, as if there is a real benefit to that over broader indexes. There are many, many positions at less than 1% of the overall fund, which really cant affect returns in a meaningful way, but does probably juice Fidelity's fee income on those funds if these target date funds are big buyers. 
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Feb 27, 2023 18:16
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zaurg posted:I'm in the process of rebalancing an expensive managed target date fund into separate less expensive funds. How does this sound?
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Feb 27, 2023 21:19
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pmchem posted:assuming those ER's are correct, and you have a > 1 decade time horizon... seems fine? Yeah, but on the other hand , the dude sucks (but he also can’t respond to me saying he sucks until Wednesday. Plenty of time for him to tase his balls.
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Feb 28, 2023 00:47
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Duckman2008 posted:Yeah, but on the other hand , the dude sucks (but he also can’t respond to me saying he sucks until Wednesday. Plenty of time for him to tase his balls. Personally I wanted to get a complete update on zaurgs finances and the crx payments and whatnot. But I love that he popped in here first with a completely boring, standard portfolio question. Please be chill, lol. Gonna start probating if you guys get crazy aggro for no reason on him.
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Feb 28, 2023 01:44
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drk posted:The more expensive one does the dumb thing of putting people in several dozen different assets, as if there is a real benefit to that over broader indexes. There is a real benefit to them--the fund managers benefit quite a bit in fact.
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Feb 28, 2023 07:42
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Baddog posted:Personally I wanted to get a complete update on zaurgs finances and the crx payments and whatnot. But I love that he popped in here first with a completely boring, standard portfolio question. Ok fair enough.
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Feb 28, 2023 11:51
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More Fidelity related questions but not sure where else to put this. I enrolled in Fidelity's Auto-Roll feature for T-Bills and it just rolled for the first time for something I bought a couple months ago. However there is no info about the money I got back from the T-Bill, it only shows Fidelity taking money out to put into the most recent T-Bill that matched the one it was rolling. Not saying Fidelity took my money but it seems like there's no history of it now (of the old T-Bill), anyone know where to search for that in Fidelity? Also, was trying to buy 912797FR3 and Fidelity wouldn't let me Auto-Roll it. Looked it up and turns out it's a 17-week T-Bill? Never seen that before. Is there some specific reason this exists? https://treasurydirect.gov/instit/annceresult/press/preanre/2023/A_20230228_1.pdf https://treasurydirect.gov/auctions/upcoming/
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Feb 28, 2023 21:43
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