|
ntan1 posted:I max out my HSA as well. I don't really have amazing investment options for my HSA, but the tax advantaged status is useful. Because my employer pays for a good portion of the deductible in the high deductible plan, my insurance over the past two years has effectively costed me -$700 per year. I'm 35. More importantly, I have about 3 or 4 times this amount in tax deferred accounts. So I could conceivably put all of this Schwab money in one or two asset classes and use my tax deferred accounts to complete a diversified portfolio So maybe I'm over-thinking this. What options for taxable investments have the lowest total overhead (taxes and fees) for long term investments? I don't know individual stocks that well, so I was hoping for passive ETFs or maybe mutual funds at this stage. I was assuming an eventual ratio of something like 35% large cap domestic stock (value/dividend oriented) 10% mid cap stock 5% Small value stock 10% foreign large cap 5% foreign small cap 5% emerging markets 15% bonds 5-10% REIT 5-10% other
|
#
?
Sep 26, 2013 21:20
|
|
|
|
| # ? May 15, 2024 06:35 |
|
|
It's sounding like you have more money than the average person in this forum if you have a Taxable investment account. http://www.bogleheads.org/wiki/Principles_of_tax-efficient_fund_placement Place the REIT/bonds in your tax-deferred accounts. Use the Taxable account for us/international stocks. Your eventual ratio looks fine to me. (Here, when I say stocks, I am talking about mutual funds or ETFs that contain stock)
|
|
#
?
Sep 26, 2013 21:57
|
|
|
Folly posted:I'm 35. More importantly, I have about 3 or 4 times this amount in tax deferred accounts. So I could conceivably put all of this Schwab money in one or two asset classes and use my tax deferred accounts to complete a diversified portfolio http://www.bogleheads.org/wiki/Principles_of_tax-efficient_fund_placement That's a pretty good overview of how to split out your investments. The principals are pretty simple, you put tax-inefficient stuff (usually bonds and bond-like instruments who's returns are mostly taxable dividends) in your IRA/401k/other protected accounts, and put tax more efficient vehicles (stocks and stock-like instruments who's returns are mostly price appreciation) in your taxable accounts. Personally my taxable accounts are mostly low-cost stock indices and municipal bonds, with taxable bonds and REITs in my tax-protected accounts.
|
|
#
?
Sep 26, 2013 22:25
|
|
|
Thanks goons. This is a fairly concise guide. I've seen this site mentioned before but I've never actually visited it. The taxable account is kind of an accident, which is why I'm not prepared for it. When I moved to the new house, I managed to lock in an interest rate of 3.625% after I put as much down as I could to get the lowest rate. I still had some left over, so I'm placing a bet my portfolio will return a 3.625% real return over the next 30 years. (It can actually return slightly less due to my primary mortgage tax deduction.) In a few years I should be able to pay off the mortgage, so I can bail if this turns into a bad bet. Generally, I don't like the idea of investing with borrowed money. But this seems safe enough even with my level of risk aversion.
|
|
#
?
Sep 27, 2013 13:08
|
|
|
When I see this:code:I'm thinking of moving from a targeted retirement fund (FA FREEDOM 2050) to setting up my own ratios after reading 4 Pillars. Anything stand out, good or bad, with my following options? code:
|
|
#
?
Sep 27, 2013 18:30
|
|
|
Nail Rat posted:I've seen a couple references to putting a lot in an HSA - is there a particular reason for that? Another benefit worth mentioning: HSA contributions made directly from a paycheck avoid Social Security and Medicare taxes which are currently 7.65% (SS: 6.2%, Medicare: 1.45%). Earnings deferred into a 401k are still subject to this tax and are paid in the pay period: Gross - Medical - HSA contribution = FICA taxable FICA taxable - 401k contributions = Taxable Income
|
|
#
?
Sep 27, 2013 18:36
|
|
|
BnT posted:Another benefit worth mentioning: HSA contributions made directly from a paycheck avoid Social Security and Medicare taxes which are currently 7.65% (SS: 6.2%, Medicare: 1.45%). Earnings deferred into a 401k are still subject to this tax and are paid in the pay period: If you make the contributions after you recieve your paycheck is there a way to receive those taxes back?
|
|
#
?
Sep 27, 2013 18:51
|
|
|
asur posted:If you make the contributions after you recieve your paycheck is there a way to receive those taxes back? I'm nearly sure the answer is no unless you're already capping Social Security tax. There are no caps for Medicare tax, so pre-tax is better (if possible).
|
|
#
?
Sep 27, 2013 20:23
|
|
|
You get to claim post-tax HSA contributions on your tax return as a reduction to your AGI. Does that not affect SS/Medicare taxes?
|
|
#
?
Sep 27, 2013 20:30
|
|
|
kingcrimbud posted:The management fee is part of the expense ratio, correct? It's on top of the expense ratio. In other words, they're ripping you off even more  Really, the S&P500 fund is the only decent fund that you have in your account.
|
|
#
?
Sep 27, 2013 21:36
|
|
|
ntan1 posted:It's on top of the expense ratio. In other words, they're ripping you off even more I might as well just stick with my FA FREEDOM 2050 then huh?
|
|
#
?
Sep 27, 2013 22:28
|
|
|
kingcrimbud posted:I might as well just stick with my FA FREEDOM 2050 then huh? No, you lose .66% doing that. Get the S&P500 index and diversify in other accounts with better fund options.
|
|
#
?
Sep 27, 2013 23:50
|
|
|
Hey guys, I'm 29 (single, no intentions of ever having kids), and I just now got a 401k (managed by Fidelity) through my job. I set it to 4% which is the maximum my employer will match. I wanted to ask about my plan options. Currently, I am on the '1985 birth year fund' with an annual fee of 0.52%. The allocation is as follows. HP INT'L EQUITY FUND 30.10% HP US LARGE CAP EQTY 29.20% Emerging Mkt Eqty Coll Trust - Class C 9.60% HP SM/MID-CAP EQUITY 7.41% PIMCO High Yield Instl 5.82% GLB REAL ESTATE FUND 5.09% HP COMMODITY-LINKED 4.83% HP CORE BOND FUND 4.00% HP LONG TERM BOND 3.93% If I wanted to change the allocations by myself, I have the following options. HP US LARGE CAP EQTY HP SM/MID-CAP EQUITY HP INT'L EQUITY FUND US LARGE CAP EQ INDX US SM/MID CAP EQ IDX HP INTL EQUITY INDEX HP SHORT TERM BOND HP CORE BOND FUND HP CORE BOND INDEX HP PRIME MONEY MKT Having started reading '4 Pillars' and watched PBS Frontline's 'Retirement Gamble' I am inclined to do the following. 1. Move to an index fund (killing fees). 2. Stay away from bonds (too little return). So I'm guessing 50%/50% between large and small/med Cap EQ index? Or am I talking out of my rear end? Aside form this, I am also moving another 10% of my income to my savings account each month, and another 10% towards a student loan which should be paid off by mid next year. Once I have 6 months worth of living expenses saved up in my savings account, I'll open an IRA with Vanguard. When I finish paying off my student loan I think I can move ~20% of my income to the IRA on a regular basis. I'll probably be asking questions about the IRA once the time arrives. I appreciate any input. I would be even more grateful if in your suggestions you could include a reference (book or link). Thanks,
|
|
#
?
Sep 28, 2013 05:42
|
|
|
1) Yes to index funds. 2) No. It's not quite as simple. Modern portfolio theory states that adding a small amount of bonds to your portfolio will significantly decrease your risk while only slightly affecting your portfolio's total return. In other words, it's not a linear relationship between %bonds and %return. The actual math is complicated is based on co-variances. But basically, adding 10-30% bonds is a good idea even for the most aggressive portfolio. Similarly , adding 10-30% stock will increase the return of an all-bond portfolio without increasing risk. The fact that all assets are not perfectly correlated is why owning diverse asset classes (intl/domestic, large/small cap, stock/bonds) and regular rebalancing works to increase returns and decrease risk. It's one of the only "free lunches" available. I recommend reading "The Intelligent Asset Allocator" for more details. INTJ Mastermind fucked around with this message at 18:01 on Sep 28, 2013 |
|
#
?
Sep 28, 2013 17:43
|
|
|
Quote not edit
INTJ Mastermind fucked around with this message at 18:01 on Sep 28, 2013 |
|
#
?
Sep 28, 2013 17:47
|
|
|
INTJ Mastermind posted:1) Yes to index funds. Thanks. After finishing Ch. 2 of "4 Pillars" (after making the post last night) I now understand that bonds are not bad. I changed my distribution to: US LARGE CAP EQ INDX 37% US SM/MID CAP EQ IDX 38% CORE BOND INDEX 25% and I'll redistribute as I learn more. I'll diversity more with my IRA as I'm sure I'll have loads of options there. I'll also read "The Intelligent Asset Allocator" once I'm done with "4 Pillars". All this investment stuff is making me fall behind on my "1984" reading.  Thanks again.
|
|
#
?
Sep 28, 2013 18:58
|
|
|
My company is switching 401(k) plans from Vanguard to Merrill Lynch on the first of the year. How much of a fee increase should I expect?
|
|
#
?
Sep 28, 2013 19:14
|
|
|
PIPBoy 2000 posted:My company is switching 401(k) plans from Vanguard to Merrill Lynch on the first of the year. How much of a fee increase should I expect? Ugh, See what is being offered and compare fees. Take a snap shot of your fund options and fees now, and ask them what the new options will be. Perhaps you can suggest they either A don't switch (not likely) or B have them include some low cost index funds. Sorry for your loss of vanguard
|
|
#
?
Sep 28, 2013 20:26
|
|
|
theHUNGERian posted:After finishing Ch. 2 of "4 Pillars" (after making the post last night) I now understand that bonds are not bad. I changed my distribution to: After finishing reading the 4 Pillars you'll probably put more money back into Stock :P. (a 10% allocation into bonds is usually what is average your age)
|
|
#
?
Sep 28, 2013 20:30
|
|
|
theHUNGERian posted:Thanks.
|
|
#
?
Sep 28, 2013 20:37
|
|
|
Cranbe posted:Why not just wait the week and a half until you finish the book to buy anything? Then you don't have to worry about brokerage fees or time limits on trading after you change your mind. Good point. But given that my 401(k) options are limited, I didn't want to spend too much of my time optimizing it. I'd rather get my IRA diversification bang on. ntan1 posted:After finishing reading the 4 Pillars you'll probably put more money back into Stock :P. (a 10% allocation into bonds is usually what is average your age). Ch. 2 finishes with "... even the most aggressive investor should not have more than 80% of their savings in stock." Or am I wrong in applying all this knowledge to a 401(k)? theHUNGERian fucked around with this message at 21:28 on Sep 28, 2013 |
|
#
?
Sep 28, 2013 21:22
|
|
|
PIPBoy 2000 posted:My company is switching 401(k) plans from Vanguard to Merrill Lynch on the first of the year. How much of a fee increase should I expect?
|
|
#
?
Sep 29, 2013 15:16
|
|
|
Ok, here's a question that I haven't found a good answer for. I am fully vested in a pension from my former employer. It is cash-based and valued at about 15% of my total investment assets. The company that has it is very solid and I feel fairly secure that it will not default. Every year, the company sets an interest rate for it and it grows. The rate is typically a fair bit better than the best CD I could get with the same amount of money. (I think it usually competes with the company's own 7 year bond rates.) I believe that I can roll it into a traditional IRA without a penalty. Assuming that's true, is there any reason not to? I mean, for diversification purposes, this is probably the only way I'll be able to get an asset like this. I guess it is mostly a corporate bond in terms of asset class?
|
|
#
?
Sep 30, 2013 17:48
|
|
|
Thank you for whomever it was that posted about that PBS Frontline 'Retirement Gamble' episode, I had never seen it before. If you're like me and never watched it, take the 50 mins to do so, as it was certainly eye-opening. ( http://video.pbs.org/video/2365000843/ ). I found it depressing, though not surprising, that the majority of the firms were full of crap. It did help to reaffirm how awesome Bogle is though, he seemed to be the only one telling it how it is. Now to wait for amazon to ship my first batch of reading/educational material. I picked up the 4 Pillars, The Clash of Cultures, and The House that Bogle Built. I figure that's a good start as I get my feet wet into all of this.
|
|
#
?
Sep 30, 2013 18:13
|
|
|
I'm filling out a Vanguard form to basically abandon ship from an Ameriprise inherited IRA and transferring it all to a Vanguard inherited IRA (the form is creating the Vanguard account). The form has some checkbox options of "Check this box if your assets include Vanguard mutual funds to be transferred in-kind" and "Liquidate and transfer all assets (mutual funds) in this account (Ameriprise)" The guy on the phone at Vanguard warned me to ask Ameriprise what kinds of fees, if any, I'd be looking at to liquidate the assets before I decide to do that. I'm wondering what you guys would consider "reasonable" fees and if they charge something deemed unreasonable, what should I do? Does the first checkbox I mentioned mean that I can transfer what I have in-kind, fee-free, and now Vanguard simply handles the shares I just transferred, or does it mean something specific by saying "Vanguard mutual funds" that I can't necessarily check that box? I'm a finance dunce newbie so any handholding explanations supplementing advice would be great. I have a phone call appointment with my Ameriprise guy tomorrow that I will need to "break up" with them during. I will find out about the fees then, but I'd like to have my decisions made and ready for whatever answer he gives me.
|
|
#
?
Oct 1, 2013 00:08
|
|
|
drat Bananas posted:I'm filling out a Vanguard form to basically abandon ship from an Ameriprise inherited IRA and transferring it all to a Vanguard inherited IRA (the form is creating the Vanguard account). The form has some checkbox options of "Check this box if your assets include Vanguard mutual funds to be transferred in-kind" and "Liquidate and transfer all assets (mutual funds) in this account (Ameriprise)" The guy on the phone at Vanguard warned me to ask Ameriprise what kinds of fees, if any, I'd be looking at to liquidate the assets before I decide to do that. I'm wondering what you guys would consider "reasonable" fees and if they charge something deemed unreasonable, what should I do? Does the first checkbox I mentioned mean that I can transfer what I have in-kind, fee-free, and now Vanguard simply handles the shares I just transferred, or does it mean something specific by saying "Vanguard mutual funds" that I can't necessarily check that box? Ameriprise might have a fee to sell them. Just like selling shares of stock you would pay a commission/fee for the transaction. I think most of the time, this is a fixed fee per sale, so if it cost $10 per trade and your Ameriprise portfolio consisted of 8 mutual funds you would pay $80 in fees to sell all of it. Calling Ameriprise to find out the fees if any is the way to go, even though you'll probably have to suck it up and pay them no matter what the fees are. This is my understanding of these issues, in which I have about 95% confidence. So double check everything with another source.
|
|
#
?
Oct 1, 2013 00:35
|
|
|
You may have a deferred sales charge if you have any class B or C shares. If you are working with a Ameriprise franchise advisor the advisor will pay the transaction charge, if applicable.
|
|
#
?
Oct 1, 2013 02:35
|
|
|
Madbullogna posted:Thank you for whomever it was that posted about that PBS Frontline 'Retirement Gamble' episode, I had never seen it before. If you're like me and never watched it, take the 50 mins to do so, as it was certainly eye-opening. ( http://video.pbs.org/video/2365000843/ ). I found it depressing, though not surprising, that the majority of the firms were full of crap. It did help to reaffirm how awesome Bogle is though, he seemed to be the only one telling it how it is. I'll take (at least partial) credit for bringing it up - I'm glad I was not the only one who got something out of it. I think that documentary could have been a good deal better had they extended it by another 30 min showing data, explaining more background material, and not focus on 'investment advisers are bad'. If you are anything like I am, you'll find the first 3 chapters of '4 Pillars' far more eye opening as it shows data in a very readable format.
|
|
#
?
Oct 1, 2013 03:47
|
|
|
theHUNGERian posted:I'll take (at least partial) credit for bringing it up - I'm glad I was not the only one who got something out of it. I think that documentary could have been a good deal better had they extended it by another 30 min showing data, explaining more background material, and not focus on 'investment advisers are bad'. Yeah, but having a pretty interesting documentary is a great way to open people's eyes enough that they start becoming interested in finding out more and go read a book like 4 Pillars or Bogle's little book of investing. Having a bit of human element to it (the interviewee's sharing their experience losing their livlihoods) really helps plant the seed in a person's mind that they could very easily end up in the same situation. Alot of people find the task of opening a book like that to be daunting unless they already have a sense that what they're going to be reading will be useful. They are pretty much ground-level books, and well written (particularly 4 Pillars), but it seems like your average person just finds investing to be so boring or complicated that they just don't even want to put forth the effort to start reading a book on it. For that purpose, I thought it was extremely effective.
|
|
#
?
Oct 1, 2013 04:32
|
|
|
I have a 401k question: Back before gas prices really started spiking, we had some bad storms here in Georgia and I had to dip into my 401k for a loan to get my roof replaced (Allstate denied my claim and I didn't have the ability to lawyer-up and fight them at the time). Then gas prices spiked like crazy and I was put in the position where I had to basically default on the loan to afford to drive to work, so I got a 1099 with the loan listed as a distribution and ended up paying the IRS for the next three years every time I filed (an amount that was basically half of the original loan by the time all was said and done). While all this was going on, my employer changed 401k companies from Fidelity to John Hancock. Fidelity issued the 1099, but John Hancock still shows the loan as outstanding and unpaid and is constantly accruing interest (the balance was $7k when the 1099 was issued, now it's nearing $10k). I've argued with John Hancock reps about this since 2011, but have never got anywhere and have basically been told "tough poo poo, you're hosed unless you can repay it all at once". Do I have any recourse or argument to make here, or am I well and truly hosed like they tell me? Some Pinko Commie fucked around with this message at 19:57 on Oct 1, 2013 |
|
#
?
Oct 1, 2013 19:49
|
|
|
I guess I will just pose a question and hope a European goon (or someone else who has some experience or knowledge) will be able provide some insight. I just started my first full-time position in Germany (or really at all) as a graduate trainee and I have been looking at what options are available for me in terms of investing and my pension and am unsure as to how to really proceed. First off, I have received some conflicting information concerning whether or not I can participate in my company's pension program while abroad since I am American. Additionally, I have had trouble finding a sort of "investment platform" wherein I can set up via online or whatnot monthly withdrawals for investments in funds or what have you as well as seeing how my investments are doing. To be honest, I don't even know if these exist in the States although I did have for awhile a Franklin Templeton account with money in their Franklin Income Fund Class A (FKINX). Is there any goons out there with any knowledge of how things work in Europe to offer me advice?
|
|
#
?
Oct 1, 2013 20:47
|
|
|
Wade Wilson posted:I have a 401k question: I think you need to have a new hobby and call them every day until it's fixed. Even better if you can get someones name and always ask for them. You don't need to be mean about it, but get to know them enough that they recgonize your voice every time you call. "Hey, it's me again, any updates yet". Also, I think you need to evaluate your budget, get on a written budget, and see if you can afford your life and this house. Gas prices spiking to $4.00 a gallon should have not thrown you over the edge of a financial cliff. The fact it did tells me that you metaphorically speaking you had already slipped off and you were hanging on to the edge with your fingernails. People, this is why we have emergency funds!!! But this still shouldn't mean you pay back a loan that shouldn't exist anymore, especially once you already paid taxes and penalties on it.
|
|
#
?
Oct 1, 2013 21:34
|
|
|
Zeta Taskforce posted:I think you need to have a new hobby and call them every day until it's fixed. Even better if you can get someones name and always ask for them. You don't need to be mean about it, but get to know them enough that they recgonize your voice every time you call. "Hey, it's me again, any updates yet". A 120 mile round-trip daily commute and gas spiking up to $5.50 for a whole month will royally gently caress you over, no matter how much you make (that's nearly three tanks of gas for most cars every work week). Things were pretty hosed budget-wise back then, I'll grant you that, but since then the house has been paid off and the only non-monthly-utility bill I have now is my car note. It's just this horribly fast growing "loan" balance that is bugging me. Also, I did speak with them again this afternoon and their position is that it's a requirement somehow through some IRS regulation that it stays on there like that, complete with claims that I'll never actually have to pay it since I already have the 1099 for it, etc. I asked them for some written proof of this, or a specific reference to the IRS regulation itself so I can go look it up and verify this for myself and they said they'd have to look it up and then email it to me, so it'll definitely be my new hobby to keep bugging them for it.
|
|
#
?
Oct 1, 2013 22:48
|
|
|
Wade Wilson posted:A 120 mile round-trip daily commute and gas spiking up to $5.50 for a whole month will royally gently caress you over, no matter how much you make (that's nearly three tanks of gas for most cars every work week). No, it really doesn't. It sucks a lot and is a big drain on cash, yes, but "royally gently caress you over" it should not do. Let's assume a below-average car that gets 20mpg commuting. That's 6 gallons of gas a day. At $5.50/gal that's $33/day. At $3.50/gal that's $21/day. Ignoring the fact that that is an insanely time and money consuming commute in the first place, if an extra $12/day for one month (we'll call it $300 for the month assuming a few days off) royally fucks you then you are living on the financial edge. A $300 unexpected expense is pretty trivial in the grand scheme of unexpected/emergency expenses. It sucks, but your emergency fund should be able to take a $300 hit no problem. It should be able to take a hit 10x that, at least. What if the car that you depend on moving you 120 miles per day blows its head gasket or transmission? That's a $1000+ expense. Or what if your home furnace goes out in the winter? Or your sewer lines burst and start flooding your house? If $300 royally fucks you, what does $1500 do? What about $5000? And that's all assuming that the rest of your budget didn't adjust at all to account for the increased spending on commuting. Edit: I don't mean to attack you personally, but this is a really good example why budgeting and ample emergency funds (that are not retirement accounts) are so important, doubly so if you are a homeowner that is on the hook for huge unexpected expenses like a new roof. If someone is living paycheck to paycheck, or even nearly so, it doesn't take much to really make a mess of things. Guinness fucked around with this message at 23:32 on Oct 1, 2013 |
|
#
?
Oct 1, 2013 23:11
|
|
|
Wade Wilson posted:A 120 mile round-trip daily commute This is an insane commute. What if you lived within really, really, easy biking distance (<4 miles) from work? Would your rent/mortgage go up more than $800/month? That's what you're spending on gas assuming you stay in on the weekends and never go anywhere else. If you were making $50k a year, 20% of your pre-tax income is gas! I'll just mention the stress and hassle of 3-4 hours in the car every day and leave that there too.
|
|
#
?
Oct 2, 2013 00:56
|
|
|
I invested some into the stock market (standard taxable account) during the downturn (2009) and in 2011 I had enough extra savings from maxing my 401 that I opened a Roth IRA, but at the time I did it very haphazardly. I've been looking into righting myself and getting my Roth back up to speed since I now have enough stability to start putting back into it. I'm not afraid to admit I'm lazy as all hell and take the easy way out on everything, to include retirement saving. I also have absolutely zero desire to do any form of short-term trading or management. To that end I've been focusing on what options I have for well established stable stocks with dividends or low expense ratio ETFs/Index Funds/Mutual Funds for diversity with the goal of dumping money into the Roth once a quarter, putting it into a small set of stocks/funds, and ignoring the entire thing until the next quarter for a brief influx of new cash. Although I do like the SigFigs interface, so I'll probably end up checking that once a week or so to make sure the world isn't falling on one of my stocks. That being said, my reason for posting this is there is one thing I've yet to be able to figure out on my own that I'm hoping someone here can clear up, Targeted Retirement Funds. I do understand the base concept of a Mutual Fund designed around earning gains early through risky investments before switching to lower yield but more reliable (as much as anything can be) stocks/bonds as the target date gets closer. They came on my radar because of the whole idea of a one-shop stop for a fully diversified portfolio is appealing. My question is, are they actually worth it (assuming you can find one without a inflated expense ratio)? In my limited experience and knowledge, and even with the desire to keep investing as simple as possible, they don't seem to offer any advantage to doing a bit more diversification and management yourself even on a quarterly basis. It could be because I'm only focused on the performance of the past five years through the problems experienced over that period, but it the history of the funds I've looked at just paint a picture of slow response and adherence to rigid standards that left most targeted funds hit much worse off by comparison to a more DIY approach.
|
|
#
?
Oct 2, 2013 06:23
|
|
|
nessin posted:My question is, are they actually worth it (assuming you can find one without a inflated expense ratio)? They are worth it if the expense ratio is low and the asset allocation matches yours. In general, I can offer pretty much only one target fund that I think is worth it, which is the Vanguard Target Retirement fund. If you're considering a Roth, then putting all of your money into a Vanguard Retirement fund is a very good choice. nessin posted:In my limited experience and knowledge, and even with the desire to keep investing as simple as possible, they don't seem to offer any advantage to doing a bit more diversification and management yourself even on a quarterly basis. It could be because I'm only focused on the performance of the past five years through the problems experienced over that period, but it the history of the funds I've looked at just paint a picture of slow response and adherence to rigid standards that left most targeted funds hit much worse off by comparison to a more DIY approach. A five year period is almost certainly not enough time to judge a mutual fund. It's true that doing the management yourself may offer better expense ratios, but most other funds that you look at will almost certainly fall into survival bias, or be extremely risky. Basically, mutual fund companies only keep active mutual funds that seem attractive (eg. have high gains over the past few years). Ironically, these are the funds that are most likely to soon fail, and have very little long term history behind them. They're also expensive. Many people, including me, do not directly use target funds. If you decide to avoid target funds, then I strongly recommend that define your personal asset allocation, invest in index funds, and keep religiously to that asset allocation. Before that, however, I recommend that you read the 4 pillars, as listed in the OP. You can put your money into the Vanguard retirement fund until then.
|
|
#
?
Oct 2, 2013 06:32
|
|
|
29 this month and belatedly realizing I should get serious about saving for retirement  Anybody bored enough to advise me? Details: Single, renter, current income is a paltry 40k but tax-exempt (foreign resident) and zero debt. Setting 65 as my target retirement age.
As far as savings, that's all I've got. I assumed I had monthly salary deductions going into the Fidelity ORP, but apparently you have to set up an SRP (Suppplemental Retirement Program) under a Fidelity 403(b)(7) to make personal contributions, which I never did... Now I'm hoping to make up for lost time by investing heavily towards retirement, while simultaneously building a foundation for medium-term saving goals (IE house downpayment by 2020ish, kids one day, whatever). So, my tentative plan: I opened a Fidelity Roth IRA and want to deposit $5,400 to max out my 2013 contributions. In April 2014, I can submit another $5,400ish and max out that year too. That leaves me with $9,200 to invest, which I plan to put in the Fidelity 403(b). Then all I have to do is make sure the Roth IRA and 403(b) are invested in good funds, reinvest any interest, and make monthly contributions to both (although I can't contribute to the Roth until 2015). Any feedback or guidance would be hugely appreciated, since I have no idea what the gently caress I'm doing.
|
|
#
?
Oct 2, 2013 09:50
|
|
|
Suntory BOSS posted:So, my tentative plan: I opened a Fidelity Roth IRA and want to deposit $5,400 to max out my 2013 contributions. In April 2014, I can submit another $5,400ish and max out that year too. That leaves me with $9,200 to invest, which I plan to put in the Fidelity 403(b). Then all I have to do is make sure the Roth IRA and 403(b) are invested in good funds, reinvest any interest, and make monthly contributions to both (although I can't contribute to the Roth until 2015). Instead of Fidelity Roth IRA, put it in a Vanguard Roth IRA instead, in the Target 2050 retirement fund. The reason for this is because you seem like the type of person who wants to have everything easy, and Vanguard has a .18% expense ratio instead of Fidelity's .5% or so. What are the options in your 403b? if it's L plan, just stick with it as it's usually good.
|
|
#
?
Oct 2, 2013 10:06
|
|
|
|
| # ? May 15, 2024 06:35 |
|
|
Zeta Taskforce posted:I think you need to have a new hobby and call them every day until it's fixed. Even better if you can get someones name and always ask for them. You don't need to be mean about it, but get to know them enough that they recgonize your voice every time you call. "Hey, it's me again, any updates yet". Lay it all out in a letter, and email. Create a clear and concise timeline of when you took the money, when you stopped paying, when you went into default (the balance when you went into default). And the 1099 that says you took a non-qualified distribution, and the evidence of the payments you have made to the IRS. Clear out the pre-post default 401k situation and do the math to figure out what your situation should be with the new 401k company. Lay it all out and escalate until you get someone who can figure out what happened with a clear step by step account of what happened, and more important clearly understand what your end result should be (no loan, no double 1099). Then as someone above suggested call every day until both your old and new 401k providers clear up the issue, document who you talk with, and ask them for a letter when it is cleared up. Can't let these things drag on it gets messy when they cross over tax years and companies.
|
|
#
?
Oct 2, 2013 13:56
|
|