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Gold and a Pager posted:I'm 27 now, finally finished with school, working my first real job and I want to start saving for retirement. I work for a German company in Germany (as an American) and so 10% of my salary is put into the public pension scheme (and matched by my employer). I won't be able to pull a pension unless I contribute for 5 years (and I am not sure if I can get the money back if I don't). I have a professor who did his PhD in Germany, and was there several years teaching at a university. He moved back to the states last year and was able to get all of his money back from his 'rentensversicherungkonto'. There is a mechanism to do that, but I don't know any of the details.
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Apr 4, 2012 01:08
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Well the wife is completely unmotivated to open a Roth account so we can deposit money into it for last tax year, so I guess I have to do all the work for her.  It's been so long since I opened my account. I'm with Ameritrade now. I'm wondering if I should just open her account with them since I am familiar with it and can link accounts, or if there is any benefit of doing something like Vanguard which I see praised so regularly in this thread.
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Apr 6, 2012 06:59
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Zeitgueist posted:Are Fidelity and Vanguard essentially interchangeable for someone looking to park their money for a while? You can click my post history in the thread for details, but I'm essentially looking to put my fiancees money into a low risk mid-term bond fund to beat inflation(if possible) for a few years, and she already has a retirement account through Fidelity. From a management standpoint, they are interchangeable. I have an account at both and they are equally easy to use. Fidelity has a little better customer support and a better app, but that's only if you're looking for that type of stuff. As for funds, Vanguard typically has lower expense ratios (although not by much). However, Fidelity seems to have more options overall if you're looking to get detailed in your allocation. Most of the funds have a similar counterpart on the other side. So I would go through the funds at either place, find what you want, then find the alternative at the other and see how they compare. For instance, VBIIX at Vanguard would be similar to FIBIX at Fidelity. Most are similar enough that you can stay at the place you feel comfortable with. So if your fiance has a retirement account at Fidelity, he/she can stay there and manage it all in one place.
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Apr 6, 2012 08:28
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Astro7x posted:Well the wife is completely unmotivated to open a Roth account so we can deposit money into it for last tax year, so I guess I have to do all the work for her. If you're just using the target retirement accounts, the advantage is that Vanguard would have a .5% lower expense ratio. That can end up being a nice chunk of change over the next 30-40 years. Better off just starting it at Vanguard if she doesn't have one anywhere yet.
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Apr 6, 2012 08:31
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I've been maxing out my Vanguard account for the past 3-4 years and I've been putting money into my 401k up to the employer match for the past 4 years. Now I seem to have a bit of money in my savings account. I'm wondering what is the next step aside from placing *more* money into my 401k.
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Apr 6, 2012 08:38
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obi_ant posted:I've been maxing out my Vanguard account for the past 3-4 years and I've been putting money into my 401k up to the employer match for the past 4 years. Now I seem to have a bit of money in my savings account. I'm wondering what is the next step aside from placing *more* money into my 401k. I'm in the exact same position, and have no idea. My cash holdings are swelling and I don't know what to do with it. I could raise my 401k contributions, but I'm pretty sure that it should be done gradually if at all, and between my 401k and Roth I'm already putting 20% of my income in tax-advantaged accounts. Now what?
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Apr 6, 2012 14:58
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Well you could buy something, or just throw them in another ETF.
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Apr 6, 2012 14:59
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bam thwok posted:I'm in the exact same position, and have no idea. My cash holdings are swelling and I don't know what to do with it. I could raise my 401k contributions, but I'm pretty sure that it should be done gradually if at all, and between my 401k and Roth I'm already putting 20% of my income in tax-advantaged accounts. Now what? I'd look at what you do for a living and how you could potentially make the jump from employee to someone with a stake.
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Apr 6, 2012 15:18
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sanchez posted:I'd look at what you do for a living and how you could potentially make the jump from employee to someone with a stake. Management consulting at a publicly-traded, non-partnership-based firm. Maybe I should finally jump on our employee stock purchase plan, I guess? Our stock is up two-fold since I started in '09, so I worry that I've pretty much missed the boat on it.
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Apr 6, 2012 15:37
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bam thwok posted:Management consulting at a publicly-traded, non-partnership-based firm. Maybe I should finally jump on our employee stock purchase plan, I guess? Our stock is up two-fold since I started in '09, so I worry that I've pretty much missed the boat on it. why do any different in a taxable account? more than half our money is in taxable accounts under the same investment plan (low cost diversified portfolio of index funds). Just pay attention to tax issues. Saving beyond what is available in tax sheltered space is a good place to be.
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Apr 6, 2012 17:31
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80k posted:why do any different in a taxable account? more than half our money is in taxable accounts under the same investment plan (low cost diversified portfolio of index funds). Just pay attention to tax issues. Saving beyond what is available in tax sheltered space is a good place to be. There are some additional useful ideas as far as balancing between taxable/tax-deferred, right? Holding a total-market fund like VTSMX (or its ETF: VTI) is a good choice in a taxable account since there will be very little buying/selling within the fund thus minimizing cap gain distributions. Also holding international funds is taxable accounts is a good choice since then you may be able to take advantage of the foreign income tax credit. There are also some funds aimed specifically as tax-managed funds. A good example is VTMGX. If you need more bonds and you can't fit them into tax-advantaged accounts, then go with municipals. There is a pretty good synopsis of all this on the bogleheads wiki: http://www.bogleheads.org/wiki/Principles_of_Tax-Efficient_Fund_Placement
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Apr 6, 2012 18:00
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flowinprose posted:There are some additional useful ideas as far as balancing between taxable/tax-deferred, right? that pretty much covers it. I prioritize broad market US and international stocks in taxable. I also trade very infrequently to make taxtime easier. I also tax loss harvest when I can.
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Apr 6, 2012 18:03
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obi_ant posted:I've been maxing out my Vanguard account for the past 3-4 years and I've been putting money into my 401k up to the employer match for the past 4 years. Now I seem to have a bit of money in my savings account. I'm wondering what is the next step aside from placing *more* money into my 401k. bam thwok posted:I'm in the exact same position, and have no idea. My cash holdings are swelling and I don't know what to do with it. I could raise my 401k contributions, but I'm pretty sure that it should be done gradually if at all, and between my 401k and Roth I'm already putting 20% of my income in tax-advantaged accounts. Now what?
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Apr 6, 2012 18:24
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gvibes posted:Max out 401k. I'm not sure why you would want to do that gradually. Yeah, me neither. I've maxed my Roth, my 401k and my HSA. I also have a growing hatred of the fact that the Federal Reserve has more control over what the stock market will do than the companies in it. These low interest rates are a killer for investing. You can lock in low rates in fixed investments or gamble that the stock market and/or other assets aren't in a bubble.
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Apr 7, 2012 00:31
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Investing/401K noob here, since I've never really paid any attention to this stuff: Back in 08' I landed my first job that actually allowed me to start putting money into a 401K with Fidelity. Long story short, I worked there for a year before being laid off. My 401K just sat there for two years while I bounced around to two other jobs (neither of which I stayed at long enough to get a 401K (laid off both times *sigh*), and my former employer moved all of my 401K money to a Fidelity Advisor Rollover IRA account. I'm at a new job now which is once again letting me put money into a Fidelity NetBenefits 401K. Would there be any advantage to me moving the existing funds from the Rollover IRA account to my new employers 401K? Also what exactly is a Rollover IRA account and what can I do with it? Can I take any of that money and invest it myself?
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Apr 9, 2012 14:57
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I just started paying attention to my retirement funds and have been thinking of adjusting my allocations. Right now all of it is in American Balanced R4. Since I'm pretty young, my thought right now is 40% Vanguard Targeted 2050, 30% Vanguard small cap Growth(VANG SM GR IDX INST) and 30% Foreign Growth(AF EUROPAC GRTH R4). I'm not sure about the foreign growth one since it has a pretty high management fee and expense ratio (.42% and .85%). Thoughts?
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Apr 9, 2012 18:13
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nelson posted:You can lock in low rates in fixed investments or gamble that the stock market and/or other assets aren't in a bubble. That is pretty much always true, whether rates are at 0 or 15%. Those rates are ultimately set by auction based on people's expectation of future returns. So when you're getting 5, 10 or 15% on fixed investments, it's because people expect returns/inflation/whatever to return that much more on risky investments.
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Apr 9, 2012 20:04
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How easy is it to switch the company your Roth IRA account is with? You know, if you're not digging them...
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Apr 9, 2012 23:25
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Astro7x posted:How easy is it to switch the company your Roth IRA account is with? You know, if you're not digging them... Depends on who you are moving to and are with. Most of the major companies make it incredibly easy. For instance, both Vanguard and Fidelity will walk you through the steps and practically do all the work for you. If you're not happy, make the switch.
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Apr 10, 2012 01:11
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Last year I started my Roth IRA and put my initial 5k into a T. Rowe Price Target 2050 account. I'm about to make my 5k contribution for the tax year and I'm debating what I want to put it into. 10k doesn't really seem to be enough to really diversify my investments myself because of the minimums required to buy the funds. Should I look into buying another already diversified fund or should I just put another 5k into the T. Rowe Price fund for now?
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Apr 10, 2012 14:24
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rockcity posted:Last year I started my Roth IRA and put my initial 5k into a T. Rowe Price Target 2050 account. I'm about to make my 5k contribution for the tax year and I'm debating what I want to put it into. 10k doesn't really seem to be enough to really diversify my investments myself because of the minimums required to buy the funds. Should I look into buying another already diversified fund or should I just put another 5k into the T. Rowe Price fund for now? Target retirement accounts are already hugely diversified internally. You should just be able to load all your money into it without issue. The 2050 fund itself holds a broadly diversified set of other funds, in a decent stock/bond ratio for someone targeting 2050 for retirement. http://www3.troweprice.com/fb2/fbkweb/composition.do?ticker=TRRMX http://individual.troweprice.com/staticFiles/gcFiles/pdf/phrplq1.pdf
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Apr 10, 2012 15:10
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Unormal posted:Target retirement accounts are already hugely diversified internally. You should just be able to load all your money into it without issue. The 2050 fund itself holds a broadly diversified set of other funds, in a decent stock/bond ratio for someone targeting 2050 for retirement. Yeah, I guess my question was more of should I move the just over 5k from that in addition to the new 5k and try to diversify myself or continue to add to the T. Rowe 2050 until I have more available to do my own diversifying.
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Apr 10, 2012 17:41
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rockcity posted:Yeah, I guess my question was more of should I move the just over 5k from that in addition to the new 5k and try to diversify myself or continue to add to the T. Rowe 2050 until I have more available to do my own diversifying. There's not really a compelling reason to do your own diversification unless you're talking about hundreds of thousands of dollars, and even then it's of marginal value, and you'd still be fine 100% in a TR fund, and even then it's more for personal control over rebalancing, and other marginal activities like tax-loss harvesting, than additional diversification. You're completely and utterly diversified even though you own only a single fund. Successful investing is incredibly boring, seek thrill elsewhere. Unormal fucked around with this message at 18:06 on Apr 10, 2012 |
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Apr 10, 2012 18:01
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I've finally looked at my 401(k) plan after nine months at my first job. Right now, I contribute 3% of my salary towards the plan, which is the Fidelity Freedom 2050. In a few months, my employer will contribute "40% of the first 6% of the employee's contributions." I feel like I should start a Roth IRA as well because I think I can afford it, but I'm a little leery. However, I do have a wedding in the near future and low six figures of student loan debt which I'm projected to pay in eight years. I also started budgeting towards a down payment of a modest house in two years. I'm thinking of holding off for now and possibly start the Roth IRA when my fiancee gets a job. My plan right now is to maximize my contributions towards my 401(k) since it's pre-tax income. Should I seriously look into starting a Roth IRA if I can afford it or am I right in being a tad conservative? Also, should I continue with the Fidelity Freedom 2050 or switch plans?
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Apr 11, 2012 03:57
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You can contribute to the Roth IRA, and then just withdraw the principle tax/penalty free. If you have the $5000 sitting around, it doesn't hurt to just contribute now, withdraw, and then fill it up again when you have the funds.
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Apr 11, 2012 04:18
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Harry posted:You can contribute to the Roth IRA, and then just withdraw the principle tax/penalty free. If you have the $5000 sitting around, it doesn't hurt to just contribute now, withdraw, and then fill it up again when you have the funds. Maybe I missed something, but what would the point be of opening a Roth IRA and immediately withdrawing the funds? DTaeKim posted:I've finally looked at my 401(k) plan after nine months at my first job. Right now, I contribute 3% of my salary towards the plan, which is the Fidelity Freedom 2050. In a few months, my employer will contribute "40% of the first 6% of the employee's contributions." I'd at least contribute 6% to get the most of your employer match.
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Apr 11, 2012 22:57
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Even if it doesn't max my contribution?
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Apr 12, 2012 00:47
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Guy Axlerod posted:Maybe I missed something, but what would the point be of opening a Roth IRA and immediately withdrawing the funds? Because, if you open up a roth ira now, and deposit in $5000 for 2011 and withdraw it, you can put the $5000 back in later as opposed to never.
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Apr 12, 2012 00:58
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Harry posted:Because, if you open up a roth ira now, and deposit in $5000 for 2011 and withdraw it, you can put the $5000 back in later as opposed to never. I thought you could only replace contributions in the tax year you took them out?
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Apr 12, 2012 01:28
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Yond Cassius posted:I thought you could only replace contributions in the tax year you took them out? I don't believe so, you might be thinking of if you take an unqualified distribution of earnings you can deposit it back before the tax year and not have to pay any taxes on it.
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Apr 12, 2012 03:19
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Harry posted:I don't believe so, you might be thinking of if you take an unqualified distribution of earnings you can deposit it back before the tax year and not have to pay any taxes on it. Now that I do some poking around, I think it's even stricter than I thought. RothIRA.com has some examples of withdrawing and returning Roth IRA contributions. RothIRA.com posted:3. Same situation, but this time I withdraw $10,000. I've withdrawn my $5,000 in contributions from this tax year as well as $5,000 from the past. I cannot re-contribute the full $10,000 this year. I can only contribute up to my maximum of $5,000. There is no way to put the entire $10,000 back into the Roth IRA other than contributing the remaining $5,000 back to my Roth IRA in the next tax year. However, Investopedia says you have 60 days to return a distribution, provided that your Roth IRA hasn't been involved in a rollover in the 12 months prior, so that's an exception that RothIRA.com didn't catch.
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Apr 12, 2012 03:49
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Didn't see that in the Roth IRA pamphlet on the IRS website, interesting. Either way though, his main worry was either short term expenses that he should be able to pay back quickly or a down payment on a home which is a qualified distribution anyway,
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Apr 12, 2012 04:31
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Is there anywhere that I can test-drive a mutual fund portfolio? I have been meeting with a financial advisor and I want to see how his picks would have done in the same time period as my own picks (I have been managing my own RRSP with qtrade for the last 18 months). I realize that the past can't necessarily predict the future but I would like to see how my own intuition holds up or would have held up... for science! 
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Apr 12, 2012 19:48
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Guitarchitect posted:Is there anywhere that I can test-drive a mutual fund portfolio? I was just playing around with https://www.kapitall.com today, they let you create a "Mirror Portfolio" where you can enter transactions over the past 13 years or so and see how it would have done. It only goes back to 1999 so I don't know if that's sufficient, but it seems to work. I'm still not sure if I like the interface, but it makes pretty graphs. Someone posted this in the Early Retirement Extreme forums about how a Permanent Portfolio would have done over the past year: http://dl.dropbox.com/u/91156/PP_return.jpg
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Apr 12, 2012 22:19
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I just became eligible to enroll in my company's 401k plan. I just signed into the site and took a look at the funds and not a single one of them has an expense ratio under 2%. Coming from my IRA with Vanguard with their incredible ER's this just makes me sick. There's no employer matching so it's only whatever I put in. I already max my IRA contribution and have a decent amount invested in a non-tax advantaged account. With expense ratios that high, is it really worth investing in my 401k? In my opinion, with the world right now asking for a 2% return is a lot, and with an expense ratio over 2% I'm pretty much guaranteed to lose money for a while until things turn around. I'm not trying to time the market or anything, but that 2% stopped me dead in my tracks when I saw it.
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Apr 13, 2012 01:24
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SeaWolf posted:I just became eligible to enroll in my company's 401k plan. I just signed into the site and took a look at the funds and not a single one of them has an expense ratio under 2%. But yeah, that's pretty brutal. I would probably skip.
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Apr 13, 2012 02:01
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gvibes posted:How long are you planning on working there? Keep in mind you can roll it over when you leave. Sure I could roll it over when I leave and then it would get to grow on sweet sweet Vanguard funds, but I'd have to let it lose money as long as I'm working there and contributing. I don't see myself working here for more than 5 years. They pinch pennies wherever they can, very little room for growth, and NYC is a poo poo place to live unless you're making a good amount of money -- which I am not. So I think it's in my better interest to skip it.
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Apr 13, 2012 02:21
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SeaWolf posted:I just became eligible to enroll in my company's 401k plan.... I'm in a similar boat. The 401k through my company doesn't have any employer match, and the available funds are pretty underwhelming. I've been skipping it for now, maxing out my Roth IRA, investing in a non-tax-advantaged account, and paying down my student loans (most at 6.6%). Once my student loans are paid off (less than 3k to go, so a couple of months), I'll revisit the 401k plans and crunch some numbers again.
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Apr 13, 2012 03:07
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One more question: Friend of mine at work enrolled in our 401k the week before I did and was curious about why all of a sudden I was backing out of enrolling. I showed her the expense ratios and explained my reasoning and she's of the same mind as me, but she's already contributed some money from her last paycheck. She's going to change her contribution to 0 now, but she wants to know if she can withdraw the contribution she just made without penalty. I know you can do that with an IRA if it's a same year contribution but I don't know how it works with a 401k and a quick googling didn't reveal anything.
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Apr 13, 2012 17:45
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So I have a quick question regarding parking some money in a low risk bond fund with Fidelity or Vanguard. Is it very hard to take your money out, should you need it for a down-payment on a house or whatnot?
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Apr 15, 2012 02:56
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