|
An older gent asked me for a handsfree portfolio allocation, I suggested: 40% AGG - Diversified Bonds 15% Something International 55% RSP - S&P 500 Equal Weighted What do you think?
|
#
?
Nov 29, 2013 04:46
|
|
|
|
| # ? May 16, 2024 05:13 |
|
|
I think those percentages add up to more than 100.
|
|
#
?
Nov 29, 2013 22:52
|
|
|
If you don't want to read the the thread's recommended books try this http://www.asx.com.au/education/investor-update-newsletter/201211-how-to-build-a-low-cost-diversified-portfolio.htm
|
|
#
?
Nov 29, 2013 22:59
|
|
|
Sorry I meant 35% AGG, 15% International 50% RSP So on the whole ETFs are the way to go? I'm not seeing the benefits of a mutual fund unless you like how they adjust the allocation over time, and even so, you can do it yourself.
|
|
#
?
Nov 29, 2013 23:51
|
|
|
I'm going to be starting a new job soon at a place that doesn't have a 401k set up yet. I'll be employee #12. With a company that small, I'm not sure dealing directly with Vanguard is the best option. Are there any recommended firms that would offer Vanguard funds (or similar), and are suited to a company of our size?
|
|
#
?
Nov 30, 2013 21:34
|
|
|
Adding a middleman: an intuitive and sensible way to minimize costs.
|
|
#
?
Nov 30, 2013 23:21
|
|
|
Guy Axlerod posted:I'm going to be starting a new job soon at a place that doesn't have a 401k set up yet. I'll be employee #12. You mean to administer the 401k plan? Try Employee Fiduciary. They should be lower cost and more suitable for a small company than dealing directly with Vanguard, and you can set it up to use all Vanguard funds.
|
|
#
?
Dec 1, 2013 01:06
|
|
|
For investing in Vanguard (or where ever else), I want to invest towards more than one medium term goal. Is there an easy way to do this?
|
|
#
?
Dec 1, 2013 02:11
|
|
|
Small White Dragon posted:For investing in Vanguard (or where ever else), I want to invest towards more than one medium term goal. Is there an easy way to do this?
|
|
#
?
Dec 1, 2013 23:01
|
|
|
Continuing on from my TSP questions... As of October 2013, The TSP opened up a Roth option with the same $17.5 limit as a normal 401(k). Question - what is the difference between a Roth IRA and a Roth TSP? How are they not exactly identical? fougera posted:Sorry I meant 35% AGG, 15% International 50% RSP ETFs are relatively new, and are gaining popularity for their relatively low expenses. I like mutual funds because of the auto reinvest without paying for more trades.
|
|
#
?
Dec 2, 2013 06:33
|
|
|
xaarman posted:As of October 2013, The TSP opened up a Roth option with the same $17.5 limit as a normal 401(k). Question - what is the difference between a Roth IRA and a Roth TSP? How are they not exactly identical? The Roth TSP follows the same rules as a Roth 401k option. That is, 17.5k limit, sponsored by employer, and you are restricted to investing specifically in funds in the TSP plan itself. In addition to the TSP, you can potentially put 5.5k into a Roth IRA as well, which you would open with any brokerage of your choosing.
|
|
#
?
Dec 2, 2013 07:04
|
|
|
So... the Roth IRA and Roth TSP are exactly the same except for the company/fund and contribution limits?
|
|
#
?
Dec 3, 2013 05:14
|
|
|
Yup. (Just got done checking my TSP/IRA's before logging on SA tonite through Vanguard's Financial Engine.)
|
|
#
?
Dec 3, 2013 07:23
|
|
|
I finished the YNAB email investing course. The content is a pretty good primer. It covers the different types of taxed-advantaged accounts pretty well, and also explains the advantages of ETFs. The big downside to it is that it doesn't really get into asset allocation beyond "X% stocks (100-X)% bonds" because Jesse thinks it's too complicated, and he really pushes the Betterment management service to handle it for you instead. Betterment probably is the least terrible management service out there, because they don't actually do a whole lot of managing; their portfolios are just a defined mix of core Vanguard and iShares ETFs and all they do is adjust the ratio of stocks to bonds based on an assessment of your risk tolerance. Still, their management fees start at 0.35% annually, which seems like a lot for what you actually get (though the lower ERs and waived commission fees offset that a bit I suppose). For what it's worth, he does mention the Vanguard Target Retirement date funds as a good lazy option as well. Overall, it really isn't a bad primer, it sells the need to start saving for retirement as young as possible, it's just that it seems like Jesse a little more is willing to spend a bit more to keep things simple for him than the posters in this thread. Not sure if it's something worth adding to the OP or not. For anyone that's interested: http://www.youneedabudget.com/courses/investing
|
|
#
?
Dec 3, 2013 11:57
|
|
|
Kilty Monroe posted:Betterment probably is the least terrible management service out there, because they don't actually do a whole lot of managing; their portfolios are just a defined mix of core Vanguard and iShares ETFs and all they do is adjust the ratio of stocks to bonds based on an assessment of your risk tolerance. Still, their management fees start at 0.35% annually, which seems like a lot for what you actually get (though the lower ERs and waived commission fees offset that a bit I suppose). Ew, 0.35% for something that I can easily do myself? No thanks. It sounds like they're just doing more or less the same thing as the Vanguard Target Retirement funds anyway, and Vanguard charges much less.
|
|
#
?
Dec 3, 2013 15:24
|
|
|
Kilty Monroe posted:I finished the YNAB email investing course. The content is a pretty good primer. It covers the different types of taxed-advantaged accounts pretty well, and also explains the advantages of ETFs. The big downside to it is that it doesn't really get into asset allocation beyond "X% stocks (100-X)% bonds" because Jesse thinks it's too complicated, and he really pushes the Betterment management service to handle it for you instead. On another note, I get to pick fund allocations with my new employer woo! My fund options aren't horrid but the selection with an ER under 0.40% are limited. I'm pretty sure I can do the needful for a reasonable ER though. We shall see shortly.
|
|
#
?
Dec 3, 2013 19:46
|
|
|
Alright, so I've received a bit of a windfall recently and I have some questions. I'm in my early twenties, and meeting my expenses/savings goals pretty well so far since graduating college. I really don't expect to need this money any time soon, and have already maxed out a Vanguard Roth IRA for this year. There's $20,000 left over. My current employer doesn't offer any benefits, and as I am applying to grad school, I don't expect to be able to contribute to an employer-matched 401k any time within the next 2-6 years.* At the same time though, my plans could very well change if I don't get in, decide not to go, or drop out. In that case I would probably eventually find a job with 401k benefits. What should I do with this money? Save it and max out the IRA for a few more years as it lasts? If I were to put it into mutual funds or something, could I move it into the IRA without getting penalized? I'm using vanguard, if that's relevant. *Any grad students here that could comment on this? Do schools ever offer investment benefits?
|
|
#
?
Dec 3, 2013 22:29
|
|
|
If you've got an established emergency fund, all your debts paid off, and your IRA for 2013 fully funded, then some other things to consider: - Hold on to $5500 of it until Jan 1 when you can fully fund your 2014 IRA. - Are you on an HDHP? If yes, have you fully funded your HSA for 2013? If yes and yes, hold on to another $3100 to fully fund your HSA for 2014 on Jan 1. - Open a taxable brokerage account (through either Vanguard or wherever) to invest with - Online savings account/CD through Ally, CapitalOne, etc. The rates still kind of sucks (0.6-0.8% APR typically) but a heck of a lot better than your checking account if you are extremely risk-averse and want to sit on it as cash/near-cash. If you put funds in a taxable account and then later move them into an IRA, you will be assessed on the gains/losses when you move the money but since it's an ordinary taxable account there is no penalty to selling and transferring.
|
|
#
?
Dec 3, 2013 22:35
|
|
|
Echo 3 posted:Ew, 0.35% for something that I can easily do myself? No thanks. It sounds like they're just doing more or less the same thing as the Vanguard Target Retirement funds anyway, and Vanguard charges much less. In fairness, it drops down to 0.25% once you break a $10k balance and 0.15% when you finally hit $100k, and it's a little more flexible than a TR fund because they'll customize a glidepath for your goals, but I agree: still not worth it. I also think their bond basket is way too conservative, it's always 50/50 TIPS and short-term T-notes. ronny posted:Alright, so I've received a bit of a windfall recently and I have some questions. I'm in my early twenties, and meeting my expenses/savings goals pretty well so far since graduating college. I really don't expect to need this money any time soon, and have already maxed out a Vanguard Roth IRA for this year. There's $20,000 left over. You could put it in a 529 plan for yourself, then use it to help pay for grad school. If you end up not going, though, you'll have to either let it sit there until you can contribute it to a qualifying family member's education instead or eat a penalty. If you actually are employed by the school as a TA or something, it's possible that you might be able to access some kind of plan, but your actual earned income that you could contribute to it will likely be pitiful anyways.
|
|
#
?
Dec 4, 2013 07:36
|
|
|
I've got a question re: 403(b) and 401(k). I left my last job in April of this year. It was for a university, so I had a 403(b) through TIAA-CREF I was contributing towards for over three years. I started my current job in June, and starting at the start of January, I'll be eligible for the 401(k). Is it possible to get the money that's in that 403(b) account into my 401(k)?
|
|
#
?
Dec 4, 2013 19:12
|
|
|
DrBouvenstein posted:Is it possible to get the money that's in that 403(b) account into my 401(k)? This is possible, but consider whether or not you should roll over the 403b to an IRA instead. Rolling over to an IRA is probably preferred, unless your new 401k has amazing investment options.
|
|
#
?
Dec 4, 2013 19:21
|
|
|
Rolling over to an IRA is near-universally the better option than rolling into another 401k/403b. Way more control and flexibility as well as almost always having better investment options and lower fees if you choose a not-poo poo broker. With IRAs the world is your oyster while 401k/403b plans tend to be very limited and often have sub-optimal or even downright terrible investment options.
|
|
#
?
Dec 4, 2013 19:28
|
|
|
Ok, IRA is it. I don't know much about any of this, so thanks for the help. Is the Roth IRA still the "go to" one over the traditional? Who's a good investor to go with?
|
|
#
?
Dec 4, 2013 19:45
|
|
|
DrBouvenstein posted:Ok, IRA is it. The thread is going to tell you Vanguard. Probably with Fidelity second. Really anywhere with multiple options, no or little transaction fees, and low expense ratios so you can keep more of your money ... So Vanguard.
|
|
#
?
Dec 4, 2013 19:56
|
|
|
DrBouvenstein posted:Ok, IRA is it. For a 401k/403b rollover you probably want to rollover to a traditional. If you rollover to a Roth you'll owe various taxes on the money since it is all currently tax-deferred. Moving it to a traditional IRA will maintain its tax-deferred status and should cost you nothing tax-wise.
|
|
#
?
Dec 4, 2013 20:01
|
|
|
Anyone here proficient in life insurance investment products? I have someone trying to sell a family member an "Equity Indexed Universal Life policy" as an investment, and I would like to have a better understanding of why this is an expensive horrible product before I talk this person out of it. So far I had a call with this sales guy to try and call out his BS but he is sticking to his guns, and this is apparently the greatest investment ever. Based on questioning the selling agent he said: 1. It will pay 0 (floor) - 10% (cap) based on performance of SP 500 and the principle will not decline, the principle starting point is reset year to year (S&P dividends not included) 2. It will participate 100% with the market (It would have made sense if they would kept some % or the first 2-3%) 3. There are no limitations on liquidity or surrender charges (This seems impossible to me) 4. Annual fee will be between approximately 1% (Seems very low) 5. His upfront commission from the insurance company is 10% (massive commission, doesn't seem to match up to a 1% annual fee) 6. No upfront load or deduction from principle (If $10k is put in $10k is the basis for the return) 7. No prospectus is available since this is not a registered security (Another non-comforting fact) 8. The Issuing insurance Co. is well rated (Moody's Investor Service Aa3 ) As it stands now I am waiting for him to send me the legal contract because there just has to be something I am missing. So what am I missing, what other question do I need to ask? Or is this guy just a plain liar and I will see some liquidity limitation or additional fees in the contract? Thank you for the help.
|
|
#
?
Dec 4, 2013 20:33
|
|
|
I am not proficient in life insurance investment products beyond knowing that they've historically been an effective way for companies to obscure how much money they are screwing out of their clients, but . . . The S&P 500 annual return has been as high as 30% in recent memory, so that is locking you out of a hell of a lot of upside. Missing the dividends is also important over time. An annual fee of 1% is 20 times higher than Vanguard's fee for a $10k S&P 500 indexed investment. And that's just the obvious stuff - I'm not sure I believe everything you're saying about the structure of it. Is the guaranteed minimum applied annually or over a longer period? Finally, what parts of the arrangement can the company change unilaterally in the future? All together these are the reasons I dismissed these kinds of products when I first heard about them a few years back. The commission is so high because the company will take these payments from people, put the money in the market themselves, and capture the resulting gigantic difference between the returns and their obligations to clients over the next 15 years. There is no "??", it is straight to "Profit". To persuade your friend, do the math to compare this product directly to Vanguard's S&P500 index VFIAX over a few recent time periods (10-15 years, whatever period he intends to leave the money in). Or even compare to a less risky portfolio that includes 30% bonds or something. Don't forget to account for the annual fees. I think the answer will become crystal clear.
|
|
#
?
Dec 4, 2013 21:44
|
|
|
There's like a million discussions on this and the only time whole life is a good idea is when you're rich and wanting to use it as inheritance tax avoidance (or something like that).
|
|
#
?
Dec 4, 2013 21:55
|
|
|
slap me silly posted:I am not proficient in life insurance investment products beyond knowing that they've historically been an effective way for companies to obscure how much money they are screwing out of their clients, but . . . I 100% agree, as described above it doesn't seem believable, and I suspect when I see the actual contract there will be some adjustments to the conditions. He said performance is calculated every year, and the principle balance is set to that new value annually. Since the historic CAGR of the S&P is 9.94% I don't see how capturing all of the upside above 10% makes up for eating all of the down year losses (2008 -39% for S&P). Perhaps the dividend yield makes up for it (currently SP yields 1.92%, historical mean 4.4%). So Fee + dividends ends up costing 3-5% which is a pretty heavy load. ^^ I know that whole life is a poor investment choice due to high fees, but I am looking for specifics on this particular type of Life insurance investment. I fear there must be other landmines to look out for in these types of deals and maybe someone else here has come across. them. J4Gently fucked around with this message at 22:12 on Dec 4, 2013 |
|
#
?
Dec 4, 2013 22:08
|
|
|
My company has pretty sparse 401k and HSA fund options, but we do have the following highlights (all from Vanguard): 401k: Total US Stock Market HSA: Total International Stock Market, Total Bond Market (US) I can contribute to these accounts with my intended allocation, but my question is, how can I reallocate and maintain my goal allocation if the funds are spread across different accounts?
|
|
#
?
Dec 4, 2013 23:27
|
|
|
You just gotta do your best... Don't forget that an IRA is an option too.
|
|
#
?
Dec 4, 2013 23:33
|
|
|
GoGoGadgetChris posted:My company has pretty sparse 401k and HSA fund options, but we do have the following highlights (all from Vanguard): I'd suggest using a site like PersonalCapital to track all your different accounts and compile your total allocations. Everything will get out of whack over time since you'll be contributing at different rates, but if you rebalance every year you should be able to keep on top of it. You might even be pretty good just going 100% total us stock in the 401k, then splitting the HSA 50/50 between the international stocks and total bonds. If it's still out of whack, open up a Roth IRA with Vanguard and offset the balances there.
|
|
#
?
Dec 4, 2013 23:44
|
|
|
I am a little stumped on what I should do here. I recently changed jobs and I still have my money in my old company's 401k account. I want to start contributing into my new company's 401k since they do 6% matching (my old company did not). I will like to also start to contributing to a Roth IRA as well. Should I: A. Rollover my old 401k to the new company and contribute 6% per paycheck, then open a Roth IRA and initially fund it from savings with the maximum amount for 2013 ($5,500). B. Rollover my old 401k to a traditional IRA and contribute the maximum amount for 2013 ($5,500), open a 401k with my new company and contribute 6% per paycheck. C. Rollover my old 401k to a Roth IRA and pay a boatload of taxes and contribute the maximum amount for 2013 ($5,500), open a 401k with my new company and contribute 6% paycheck. The easiest thing would be to go with A, but I am intrigued by the wide variety of investment options if I open an IRA. Since I am eligible for my company's 401k, I won't be able to deduct contributions to a traditional IRA so it makes more sense to open a Roth IRA. It would be nice to start the IRA with more than $5,500. Is it possible to have both the tax free money from my old 401k and be able to make Roth IRA contributions in the same IRA account? I know with my old 401k I could elect both 401k and Roth contributions.
|
|
#
?
Dec 5, 2013 00:32
|
|
|
Conversions don't count towards your contribution for the year. Your rollover has basically nothing to do with your 2013/2014 IRA/Roth.
|
|
#
?
Dec 5, 2013 00:36
|
|
|
Yeah, you are looking for option D, roll over the 401k to a traditional IRA and then start a separate Roth IRA with this year's $5500. It's probably what I would do. You can have a hundred IRAs, you just have to keep the total contributions under the limit. Additionally, your 401k contribution doesn't affect your IRA contribution limit. If you want to identify a "best" choice here, you have to make some assumptions about your tax situation and calculate things out.
|
|
#
?
Dec 5, 2013 00:38
|
|
|
SlightlyMadman posted:I'd suggest using a site like PersonalCapital to track all your different accounts and compile your total allocations. Everything will get out of whack over time since you'll be contributing at different rates, but if you rebalance every year you should be able to keep on top of it. You might even be pretty good just going 100% total us stock in the 401k, then splitting the HSA 50/50 between the international stocks and total bonds. If it's still out of whack, open up a Roth IRA with Vanguard and offset the balances there. You happy with personalcapital? I use mint religiously and I'm trying to talk myself into making the switch. I tried it once and closed my account as I'd have to redo all of my transactions again (sorting and renaming etc) and it turned me off of it.
|
|
#
?
Dec 5, 2013 01:03
|
|
|
slap me silly posted:Yeah, you are looking for option D, roll over the 401k to a traditional IRA and then start a separate Roth IRA with this year's $5500. It's probably what I would do. You can have a hundred IRAs, you just have to keep the total contributions under the limit. Additionally, your 401k contribution doesn't affect your IRA contribution limit.
|
|
#
?
Dec 5, 2013 04:10
|
|
|
Minty Swagger posted:You happy with personalcapital? I use mint religiously and I'm trying to talk myself into making the switch. I tried it once and closed my account as I'd have to redo all of my transactions again (sorting and renaming etc) and it turned me off of it. I'm using Mint for budget/expense tracking/goals and personalcapital for investments, mainly because the way Mint displays investment info isn't really useful at all. I have 3 accounts (403b and 457b with tiaa-cref, Roth IRA with Vanguard) and the view where PC shows you exactly how you are allocated overall is really nice if you have multiple accounts for planning how to re-balance.   (When you drill down, it will show you exactly what each index fund you have is holding for that segment - really nice. Also not my accounts, unfortunately...) Never added anything but investment accounts to PC because mint does what I want just fine for everything else. One word of warning, PC makes their money by assigning a "free" financial adviser to accounts with over 100k in value. Their job is basically to sell you to have them manage your allocations for a bit under 1%/year (depends on how much $ you have them manage). I've never actually answered the phone when they call because I don't pick up numbers I don't recognize, but they are *persistent*. So I guess sign up with a junk phone number (or Google voice) or actually pick up the phone and tell them to pound sand if you don't want the annoyance 
|
|
#
?
Dec 5, 2013 05:03
|
|
|
slap me silly posted:Yeah, you are looking for option D, roll over the 401k to a traditional IRA and then start a separate Roth IRA with this year's $5500. It's probably what I would do. You can have a hundred IRAs, you just have to keep the total contributions under the limit. Additionally, your 401k contribution doesn't affect your IRA contribution limit. What happens to the money in the traditional IRA? If I am making regular contributions to Roth IRA instead, wouldn't the money just set there and only gain from the investments I choose? From what I can tell, you can contribute to both as long as it is not more than $5,500/year.
|
|
#
?
Dec 5, 2013 06:19
|
|
|
|
| # ? May 16, 2024 05:13 |
|
|
slap me silly posted:Yeah, you are looking for option D, roll over the 401k to a traditional IRA and then start a separate Roth IRA with this year's $5500. It's probably what I would do. You can have a hundred IRAs, you just have to keep the total contributions under the limit. Additionally, your 401k contribution doesn't affect your IRA contribution limit. I also agree with this. Bluecobra posted:Is it possible to have both the tax free money from my old 401k and be able to make Roth IRA contributions in the same IRA account? I know with my old 401k I could elect both 401k and Roth contributions. Bluecobra posted:What happens to the money in the traditional IRA? If I am making regular contributions to Roth IRA instead, wouldn't the money just set there and only gain from the investments? From what I can tell, you can contribute to both as long as it is not more than $5,500/year. There is a cut-off for deductability for your traditional IRA. Yes, you may contribute $5,500/year, however if you make "too much money" then your traditional IRA is not tax deductible. http://www.irs.gov/Retirement-Plans/COLA-Increases-for-Dollar-Limitations-on-Benefits-and-Contributions quote:The deduction for taxpayers making contributions to a traditional IRA is phased out for singles and heads of household who are covered by a workplace retirement plan and have modified adjusted gross incomes (AGI) between $59,000 and $69,000, up from $58,000 and $68,000 in 2012. For married couples filing jointly, in which the spouse who makes the IRA contribution is covered by a workplace retirement plan, the income phase-out range is $95,000 to $115,000, up from $92,000 to $112,000. Huttan fucked around with this message at 06:35 on Dec 5, 2013 |
|
#
?
Dec 5, 2013 06:19
|
|