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Adiabatic posted:I'm here to see if my custom whole life policy is the best place to be putting money on the advice of user slap me silly. Better bet is put away $60/mo in a low cost market ETF or mutual fund, so you break even day 1 and 14 years later end up with a nice pile of money. Use investments for investing and insurance for insurance.
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Nov 25, 2013 19:24
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moana posted:I just opened a solo 401k at Vanguard. From the research I did, it was almost identical to a SEP except she can also contribute money as the "employer" if she's self-employed (20% of profits) and also you can take loans out against the balance of the 401k (up to 50%). As an independent contractor, you can contribute as the employer to a SEP IRA as well.
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Nov 25, 2013 19:27
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Adiabatic posted:I'm here to see if my custom whole life policy is the best place to be putting money on the advice of user slap me silly.
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Nov 25, 2013 19:52
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Kilty Monroe posted:Not sure I'm understanding you correctly. CapOne is dinging you for $7 every time you put money in your IRA? There's no reason to put up with that at all, roll it over to Vanguard. Roger, thanks. I was buying SPY which is S&P 500 ETF.. every time I make a transaction is 7$ or whatever. Assuming I'm putting in 5k / year and doing it on a monthly basis to buy SPY (or lets say I read 4 pillars and bought SPY, a bond ETF, and something else), that would be 3 trades per month, for 21$/transactions fees per month. So I guess I'm asking, is it best to buy quarterly or monthly if you are paying 7$/trade and buying 1-3 funds per month. Note: I'm buying SPY only right now because I have a 401k that is appropriately balanced based on some other feedback I got in this thread. I'm trying to figure out what to do with the Roth money and SPY seemed liked a good idea.
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Nov 26, 2013 17:52
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SPY is great for a fat piece of your portfolio. Just buy once per year - that's still frequent and regular in the long-term picture that is your IRA. There's no need to micro-analyze dollar cost averaging beyond that. And just when I was thinking about starting to use ETFs myself, Vanguard switched my institution's 401k total market index fund to admiral class shares, at 0.05% ER. Nice slap me silly fucked around with this message at 18:06 on Nov 26, 2013 |
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Nov 26, 2013 18:04
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dhrusis posted:Roger, thanks. I was buying SPY which is S&P 500 ETF.. every time I make a transaction is 7$ or whatever. Assuming I'm putting in 5k / year and doing it on a monthly basis to buy SPY (or lets say I read 4 pillars and bought SPY, a bond ETF, and something else), that would be 3 trades per month, for 21$/transactions fees per month. Gotcha, so the fee is just because you're buying ETFs? I would still roll over your IRA to elsewhere. Think of commission fees as a load. Vanguard and Fidelity both waive transaction fees on their own ETFs in an account held with them, and Fidelity also waives transaction fees on a bunch of iShares ETFs too. Then you can go as far to set up automatic paycheck contributions to your IRA without fees taking a huge bite out of it. I doubt you'll have liquidity issues with any of those 500 index ETFs, even if they're not as popular as SPY.
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Nov 26, 2013 18:44
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Kilty Monroe posted:Gotcha, so the fee is just because you're buying ETFs? I would still roll over your IRA to elsewhere. Think of commission fees as a load. Good advise, thanks... one more thing.. for Vanguard accounts, do they not have a set of 20$ fees for account maintenance / servicing? I seemed to read that one of the 20$ fees was waived if you did electronic statements, but I think there still was a "servicing fee" or something..
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Nov 26, 2013 20:03
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dhrusis posted:Good advise, thanks... one more thing.. for Vanguard accounts, do they not have a set of 20$ fees for account maintenance / servicing? I seemed to read that one of the 20$ fees was waived if you did electronic statements, but I think there still was a "servicing fee" or something.. You can see what fees, if any, apply to a Vanguard fund by going to the funds profile. Here's the one for VASGX. https://personal.vanguard.com/us/funds/snapshot?FundId=0122&FundIntExt=INT#tab=3 Edit: Looking again certain account types are charged a service fee quote:or SIMPLE IRAs: Yaos fucked around with this message at 20:15 on Nov 26, 2013 |
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Nov 26, 2013 20:08
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Does anyone know about working in America as a Canadian? Should I be funneling my money back into my Canadian Tax Free Savings? Or should I open a discount brokerage account in America?
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Nov 26, 2013 22:56
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Right. I'm 23 and need to get my poo poo together. I'm a keen budgeter and I do save, but I have no idea what to do with my savings. (It's festering at the bottom of my current account.) Where do I start with investing in the UK? I've tried to look online at the different types of accounts/investment options and it looks all a bit complicated. Can somebody push me in the right direction?
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Nov 27, 2013 10:06
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J4Gently posted:Better bet is put away $60/mo in a low cost market ETF or mutual fund, so you break even day 1 and 14 years later end up with a nice pile of money. I like the sound of this! I'm 29 and getting married in April, we have no kids and don't plan on having any. Currently I have no retirement and my wife to be has very little though she has started her 401k to the match this year. We do have our 6-8 month emergency fund setup already for both us. Right now I'm saving 1K a month liquid and become eligible for my company's 401k in January. They match 50% up to 6% so doing the full 6% to get 3% matched there would be roughly $225/check for me. My plan is to also open a Roth for 2013 and to fund that every year to the max it would cost me about $211 per check. This leaves me $565ish left a month to do whatever with. Am I best served to save the remaining balance for rainy days? Saving for a place of our own sounds great but I'm living in southern California so that will be very difficult and we're getting an incredible deal on rent right now. Do I put the entire or partial difference back into the 401k? Perhaps $60-$100/month into something like the Vanguard Total Stock Market (VTI) as mentioned? I like the idea of having a pile of cash in my early 40s. Thanks!
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Nov 27, 2013 10:07
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Since you already have an emergency fund, a 401k, and will be opening an IRA I'd say save that extra money as a rainy day fund. This will let you buy large ticket items without financing and without dipping into your emergency fund. What you put it in and how much you save depends on how quick you'll think you'll spend the money. If you think you'll be spending the money constantly a savings account would be best, but if you're okay with it sitting for a few years or more a fund is good for you. You could also grow your emergency fund. There's really an endless number of things you could do with your money. You have to decide if this is money you want to spend now, money you want to save in case you need to buy something expensive, or money you want to save for the future. Here's a question for you, do you have a non-emergency fund? If you want to buy a $1000 item do you have a way to do that without waiting for your next paycheck or dipping into your emergency fund? Yaos fucked around with this message at 16:41 on Nov 27, 2013 |
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Nov 27, 2013 16:10
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Just popping in here to get some general advice. I think I'm doing ok (could do better) with my finances, but looking for any thoughts. A simple breakdown of what I have right now: Simple IRA: I have this maxed out get 100% of my employers contribution, I add $300 per month Roth IRA: maxed out yearly contributions Savings: add $400 per month I also have ~3K in a brokerage account for speculative investing. I have a massive $250 in lendingclub which is really just an experiment (going pretty well though). So here's my thing...I am living pretty well, I treat myself to most things I want and I have excess money left over per month thanks to being a tightwad about other things, varies between 800-1300 depending on how much of a SloMo balla lifestyle I've been living. I'd like to tame that in and invest more of it, primarily in long term stuff as I'm behind on my retirement for my age. My feeling is to contribute more to the Simple IRA, I guess I'm hesitant because it's with American Funds who seem to slap on a poo poo load of fees which generally annoys me. My Roth IRA is with Vanguard who I frequently gush over, I wish I could put more money with them ideally. So what say you BFC...should I suck it up and deal with AF awful fees and lovely service or do something else?
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Nov 27, 2013 16:49
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Does anyone know of any statistical data on how much money a person saved at each age? Liquid or otherwise? I have a 401k and I've been maxing out my Roth for about six years or so, but I'm looking at this thread and there are people saving up 100k and other absurd amounts at like 25. I'm worried I'll be homeless by the time I retire.
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Nov 27, 2013 17:21
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Good data on this I don't have at my fingertips. But for example, Average savings of a 50 year old, $43,797 Percentage of Americans who don’t save anything for retirement, 36% http://www.statisticbrain.com/retirement-statistics/ So I think if you have been doing 401k plus maxing out your Roth from age 20 to age 25, you are way the hell out on the edge of the curve. Some people just have shitloads more money than you, it happens. As for me personally, I've been a pretty responsible saver and my retirement accounts got to around $100k in my mid thirties, for what that's worth.
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Nov 27, 2013 18:04
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YeahDavidLeeRoth posted:So what say you BFC...should I suck it up and deal with AF awful fees and lovely service or do something else? What are the funds available in your Simple IRA?
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Nov 27, 2013 18:47
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ntan1 posted:What are the funds available in your Simple IRA? Just American Funds ones, https://www.americanfunds.com/funds/returns/alphabetically.html
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Nov 27, 2013 18:56
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YeahDavidLeeRoth posted:Just American Funds ones, https://www.americanfunds.com/funds/returns/alphabetically.html 0.79% ER for most of their funds isn't completely horrible, but nor great either. What other fees are there for having your IRA with them?
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Nov 27, 2013 19:01
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obi_ant posted:......there are people saving up 100k and other absurd amounts at like 25. I'm worried I'll be homeless by the time I retire. As SMS posted, the simple fact that you have been saving puts you ahead of plenty of folks. Also, savings as well as final needs during retirement depend on your individual situation, (obviously). If you live off 35k/year gross, you're most likely not going to be maxing a 401k and a Roth. But your standard of living in retirement is also likely to be less than/different than the person that manages to max out all their accounts, simply because of how you live while working. Not sure if that made any sense.....
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Nov 27, 2013 19:04
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ETB posted:0.79% ER for most of their funds isn't completely horrible, but nor great either. What other fees are there for having your IRA with them? That is the ER for the A class shares that have a front load. I bet he can only get the B/C shares, which have no sales charges (as long as he keeps them 6 years) but higher ER. SIMPLE IRA AMPBX, 1.5% ER $5000 contribution, pre-tax $30112 after 30 years assuming 6% growth VFINX, 0.2% ER $3750 contribution, post-tax $33285 after 30 years assuming 7.3% growth Did I do that right? Then the tax implications of withdrawal are different, too. For the IRA you pay income tax on the distributions, for the taxable account you pay capital gains tax on the realized gains. Or something like that. Basically I have no idea how to decide which is better.
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Nov 27, 2013 19:19
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I have three funds with AF. The expenses are: New World Fund - 1.07% SMALLCAP World Fund - 1.14% New Perspective Fund - 0.8% They also charge a sales fee of 1.49% for every contribution I make, bi-monthly on each of those 3 funds. The New Perspective fund has a $10 annual fee.
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Nov 27, 2013 19:50
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YeahDavidLeeRoth posted:I have three funds with AF. The expenses are: That is... pretty terrible. I'm so sorry.
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Nov 27, 2013 20:34
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obi_ant posted:Does anyone know of any statistical data on how much money a person saved at each age? Liquid or otherwise? I have a 401k and I've been maxing out my Roth for about six years or so, but I'm looking at this thread and there are people saving up 100k and other absurd amounts at like 25. I'm worried I'll be homeless by the time I retire. If you want to see some more realistic results take a look at the finance section in Yahoo Answers. For some perspective, take a look at this thread from the Boggleheads forum. http://www.bogleheads.org/forum/viewtopic.php?f=2&t=127118 They make $250k a year, have a net worth of $1.7 million, they are 32 and 33 years old, and they are worried about retirement.
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Nov 27, 2013 20:46
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Yaos posted:I asked a similar question a while back, the people posting in this thread don't match up with what's expected based on what's happening in the world. You don't see people posting "I'm on minimum wage for the rest of my life, how should I invest for retirement?" simply because those people are not posting here. The people that do post here have enough money to care about long term investing. Honestly, it's a function based on your income and where you live (your expenses). The people who are making 200k of income probably live in extremely expensive areas. https://www.fidelity.com/viewpoints/personal-finance/8X-retirement-savings Making a comparison against the 'average' Americans probably isn't a good idea, as you already know your own circumstances.
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Nov 27, 2013 21:02
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The http://www.bogleheads.org/forum/index.php forums definately have some good info, but holy crap. There are indeed a lot of high earners that can't decide where to save their money after they've already maxed their 401k, 529s for 3 kids, and have high six digit figures already in taxable accounts. Sigh, to have those problems.....
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Nov 27, 2013 21:07
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And here's "the average net worth for the above average person" which I thought was interesting, since I'm on the "low end" of the scale and I'm not concerned about my financial situation. http://www.financialsamurai.com/2012/05/14/the-average-net-worth-for-the-above-average-person/
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Nov 27, 2013 21:21
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Any reason not to go with TD Ameritrade as a discount brokerage?
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Nov 27, 2013 22:02
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Not really. I dislike their web interface though.
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Nov 27, 2013 22:12
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moana posted:And here's "the average net worth for the above average person" which I thought was interesting, since I'm on the "low end" of the scale and I'm not concerned about my financial situation. His numbers aren't based on data but rather his construction of what he thinks the 'above average' person should be saving. His own definition of the 'above average' person is inaccurate and should really just be 'person that is able to find an above average paying job'. His couples one is even worse, so I wouldn't use it for anything. This one is fine as a guideline of where you should reach for if you qualify as having had an above average paying job for that period of working time. Honestly, he sounds insufferable after just reading two articles and we're above his 'high end'.
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Nov 27, 2013 22:14
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Well you need to keep in mind he advocates maxing your 401k before anything else, so that's going to skew his 401k numbers quite a bit.
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Nov 27, 2013 22:23
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Harry posted:Well you need to keep in mind he advocates maxing your 401k before anything else, so that's going to skew his 401k numbers quite a bit. Heh, I was actually misreading it and thought he meant non-retirement savings for his post tax. Either way, I have no issue with how he made up his numbers as a very rough estimate for the above average income individual. edit moved my reply down to an actual new post... Rurutia fucked around with this message at 22:35 on Nov 27, 2013 |
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Nov 27, 2013 22:28
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Rurutia posted:I think that's pretty standard long term investment 101. Not really, it's up to match then do IRAs, HSAs, other things.
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Nov 27, 2013 22:28
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Harry posted:Not really, it's up to match then do IRAs, HSAs, other things. Yeah I edited right after because I realized in my mind I was lumping in all IRA's together. (we max both Roth 401k and Roth IRA, so it's all the same for us) The HSA stuff before maxing 401k is debatable, as investment 101, I still think it is 401k match -> roth ira -> max 401k?
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Nov 27, 2013 22:32
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I guess the most basic investing 101 says max 401k before since it is a bad deal if you easily hit your deductible every year. If you don't though, it just acts as like another IRA at whatever the set age is.
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Nov 27, 2013 22:37
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Harry posted:I guess the most basic investing 101 says max 401k before since it is a bad deal if you easily hit your deductible every year. If you don't though, it just acts as like another IRA at whatever the set age is. I'm aware of this. I'm just not sure what it has to do with the article.
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Nov 27, 2013 22:40
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Rurutia posted:I'm aware of this. I'm just not sure what it has to do with the article. Because we're talking about an article that has ideal 401k amounts written by someone who prioritizes them above everything else.
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Nov 27, 2013 22:46
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Harry posted:Because we're talking about an article that has ideal 401k amounts written by someone who prioritizes them above everything else. He assumes you max them out entirely after 2 years of working so the effects are pretty minimal. I honestly ignored the actual breakdown because it's all made up numbers anyways. Edit: I don't mean that it's not a valid criticism, just that it doesn't really account the fact that it's still bullshit numbers. The way you replied I'd assumed you were saying that it did. Rurutia fucked around with this message at 23:00 on Nov 27, 2013 |
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Nov 27, 2013 22:49
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It seems to me that in any major city, a pretty darn good life can be had for less than $50k after tax. If you remove the super-high outliers like NYC and SF, $40k is really on the high end. In low cost of living areas, $30k is more than enough. This is assuming no kids and no crazy medical expenses. There may be other assumptions I don't even realize I'm assuming. I'm able to live in a really nice apartment in Chicago with my wife for roughly $36k a year, and that's buying plenty of miscellaneous stuff a month, having fancy meat every night, eating out at a nice restaurant once a week, fast food once a week. Our rough budget: 200 - transportation 320 - utilities, including internet/cable/cell/gas/electric 60 - alcohol 50 - fast food 350 - groceries 180 - restaurants 1300 - rent 600 - everything else If we had to, we could cut our expenses instantly down another $500 a month, or $800 if we wanted to make it hurt. We're saving $6k a month and looking to increase that. If you're a professional making $50k or more, and can find another similar person to share expenses with, there's no reason you can't max out your 401k's and IRAs, and start looking at post-tax investments.
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Nov 28, 2013 03:23
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baquerd posted:It seems to me that in any major city, a pretty darn good life can be had for less than $50k after tax. If you remove the super-high outliers like NYC and SF, $40k is really on the high end. In low cost of living areas, $30k is more than enough. This is assuming no kids and no crazy medical expenses. There may be other assumptions I don't even realize I'm assuming. I'm able to live in a really nice apartment in Chicago with my wife for roughly $36k a year, and that's buying plenty of miscellaneous stuff a month, having fancy meat every night, eating out at a nice restaurant once a week, fast food once a week. Your point is correct, sharing expenses is probably the best way to stretch your budget. However, maxing the 401k is 17.5k, maxing the Roth is 5.5k. That nearly halves a 50k salary and brings you into "graduate student stipend" territory, which in a major city is generally regarded as "poor." You are obviously living at your comfort level, and that is awesome. Your budget very closely mirrors mine, but I imagine neither of our priorities involves squeezing every ounce of fun out of our respective cities. If I were near the 50k mark in a major city, I'd probably still have a maxed 401k but you bet your rear end I'd also be scrambling for ways to improve my take home. When margins are that close, a sick cat or a car repair can trash your emergency fund and set your retirement on the back burner. Forget kids.
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Nov 28, 2013 05:08
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I know there was some HSA talk a while ago, but I can't seem to find it. I am looking to transfer my account to either HSA Bank or HSA Admin. From what I can tell HSA bank seems to be a bit better as far as fees are concerned. Does anyone have thoughts one way or the other. Most of the articles I've found are a year or more old.
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Nov 28, 2013 20:10
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