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401k: 32k Roth: 5k Sellable Company stock: 38k Wife: No invesents Tax bracket: 28% which could go into 33% next year. I'm putting about 13k + 4k match into 401k (I only need I contribute 8k to hit Max match), 21k into company a stock each year and it's growing + I get a 15% discount and 1yr look back (current stock is from 20k investment in 2013). 2 questions: 1. I know I need to diversify the company a stock but I have to pay income tax on it unless I hold for a year. I'm also using it as a pseudo home downpayment fund. Once a year passes, where should I put it? 2. At my income bracket, should I try to Max out a Roth before I can no longer contribute? I don't think that we will be able to contribute next year and I have a good bonus coming in feb that I could max mine and my wife's out for 2013. Should I?
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Jan 20, 2014 14:36
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MasterColin posted:401k: 32k 1. How soon are you buying your house? If the time horizon is less than ~8 years or so, my answer is "cash." 2. That's not a bad idea, but don't use money that you intend to use for your down payment.
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Jan 20, 2014 19:29
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Is Vanguard's website notorious for being godawful, or is it just me? I've just been trying to register a user account on their personal investor website for more than a month, and I keep getting an error message after the first step, telling me that the registration process is currently down. This is absolutely ridiculous.
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Jan 20, 2014 22:37
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Yes it is loving bad and I am reminded why I switched to Fidelity in the first place.
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Jan 20, 2014 23:04
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surf rock posted:Is Vanguard's website notorious for being godawful, or is it just me? I've just been trying to register a user account on their personal investor website for more than a month, and I keep getting an error message after the first step, telling me that the registration process is currently down. This is absolutely ridiculous.
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Jan 20, 2014 23:27
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surf rock posted:Is Vanguard's website notorious for being godawful, or is it just me? I've just been trying to register a user account on their personal investor website for more than a month, and I keep getting an error message after the first step, telling me that the registration process is currently down. This is absolutely ridiculous. I've never had any problems with the website, been using them for 6+ years now.
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Jan 21, 2014 04:01
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Dakha posted:I'm way too new at this to be able to say much. Looks pretty reasonable to my eye though. Have you seen https://www.monevator.com ? It's the best UK-specific site I've seen.
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Jan 21, 2014 14:19
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surf rock posted:Is Vanguard's website notorious for being godawful, or is it just me? I've just been trying to register a user account on their personal investor website for more than a month, and I keep getting an error message after the first step, telling me that the registration process is currently down. This is absolutely ridiculous. I have had no problems in about 10 years of use. Maybe sign up was better a decade ago?
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Jan 21, 2014 15:28
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quote:1) Contribute to 401(k) up to employer match My employer automatically contributes 3%, whether we contribute or not. Should I then contribute 0% and focus on step 2 (Roth)?
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Jan 21, 2014 16:55
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Suave Fedora posted:My employer automatically contributes 3%, whether we contribute or not. Should I then contribute 0% and focus on step 2 (Roth)? Yes.
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Jan 21, 2014 17:19
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I started investing in Vanguard when I was 13 and when I was a junior in college, I applied to an internship there and didn't get it, so I said "gently caress you, I'm moving all my money somewhere else" Since they had a physical office near where I lived, and it was before the days of doing mobile deposits, I started an account with etrade. Since then, their trading fees have skyrocketed, they dropped most of their in house low fee ETFs, their chart tech didn't improve with the rest of the industry, and I haven't been pleased with their customer service. Since I wound up getting an even better internship that led me on a different, much more lucrative career path after getting rejected from Vanguard, the sour grapes no longer exist. So they're not off the table. What I want: mobile deposits (pretty sure this is standard now) low/zero fee index funds (I know Vanguard rocks at this) low comissions on securities trades (I don't have the 250k that Vanguard requires invested to get these) a decent futures trading platform (I'm not aware if Vanguard does this) Maybe forex too? I've been educating myself about it, and I'm aware of the pitfalls, but I want the option when it comes time E: Yeah the post below reminded me of the 10 day wait for funds transfers which is a big minus in my eyes for Vanguard So what are my best options? Bloody Queef fucked around with this message at 18:26 on Jan 21, 2014 |
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Jan 21, 2014 18:18
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surf rock posted:Is Vanguard's website notorious for being godawful, or is it just me? I've just been trying to register a user account on their personal investor website for more than a month, and I keep getting an error message after the first step, telling me that the registration process is currently down. This is absolutely ridiculous. I just signed up for a new Roth IRA and Roth IRA brokerage account through their website a couple weeks ago. Other than the money transfer process taking forrreeeevvverrrr (10 days for initial funding, 5 days for an ETF purchase to settle and show up... are you kidding me?) it went smoothly for me. Although Vanguard is not the most intuitive site. I've been using Sharebuilder for the past few years and their site is way nicer and transfers and trades and all that happen a lot quicker, too. I guess that's the price you pay for cheap mutual funds.
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Jan 21, 2014 18:25
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Here we go: I have a decent amount of money in a lovely 401k plan my employer offers. They don't match anything. I started investing a while ago just to reduce my taxable income, and thanks to auto contribution increases, I ended up saving much more than I realized. Now, our division in the process of being sold off, which means that 401k plan is about to die. I know I can rollover the money to our new 401k, but I fear the same problem, namely ridiculous fund expenses. The truth is, I don't actively like managing my retirement, so I don't want to do things like pick stocks. I also don't really trust mutual fund managers (bad experience losing my college fund that was out of my control.) I know rolling over into an IRA is an option, but what will that mean for future contributions? Is it still pre-tax? Will it be automatically withdrawn from my paycheck? If I change jobs, I assume it's better, since it's an account I control? Vanguard index funds seem pretty cool, since they're cheap and don't require a whole lot of management.
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Jan 21, 2014 20:56
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Rolling over your 401k is probably not going to be an option. (Until you quit or retire.) Funds in a 401k are generally trapped while you are working for that employer. An IRA is still an option for on-going contributions. If your employer and your IRA company cooperate, you can have part of your paycheck direct-deposited into your IRA. As far as your employer knows, it's just another checking account. IRA contributions (but not Roth IRA) are tax deductible, but your employer will still withhold taxes. You'll either have to adjust your withholding, or get it back as part of your refund. If you change jobs, you will be able to roll over your 401k into your IRA. My employer was bought out, and they combined the 401ks into a new plan. There was no opportunity to cash out, or roll over into a IRA.
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Jan 21, 2014 21:30
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Bloody Queef posted:What I want:
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Jan 21, 2014 21:31
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UndyingShadow posted:Here we go: Lazy solution: roll over to a Vanguard IRA, put everything in a Target Retirement date fund. As long as you roll over to a traditional IRA everything is still pre-tax. You may or may not be able to set up direct deposit to it, but I think you can at least set up automatic contributions from your checking account. Not 100% on that though, I use Fidelity and they do that but their website is also better than Vanguard's. Either way, it will affect your tax withholding, so possibly adjust your W-4 allowances. Guy Axlerod posted:Rolling over your 401k is probably not going to be an option. (Until you quit or retire.) Funds in a 401k are generally trapped while you are working for that employer. If his division is being sold to new ownership that he'll be working for, I think that's a qualifying event where they have to give you the option to rollover.
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Jan 21, 2014 22:58
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Kilty Monroe posted:Lazy solution: roll over to a Vanguard IRA, put everything in a Target Retirement date fund. As long as you roll over to a traditional IRA everything is still pre-tax. You may or may not be able to set up direct deposit to it, but I think you can at least set up automatic contributions from your checking account. Not 100% on that though, I use Fidelity and they do that but their website is also better than Vanguard's. Either way, it will affect your tax withholding, so possibly adjust your W-4 allowances. Our division is likely being sold off to some investors, we're being turned into our own corp.
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Jan 21, 2014 23:03
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Kilty Monroe posted:If his division is being sold to new ownership that he'll be working for, I think that's a qualifying event where they have to give you the option to rollover. I think that only applies if the plan is being terminated without a replacement. It sounds like there is a new 401k.
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Jan 21, 2014 23:23
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I'm finally making enough money to be putting some away now. I currently have: Checking/Savings with Wells Fargo Credit Card with Chase HSA with Chase on a different account because it was created through my employer. 401k through employer's paycheck service. I was going to start up a Roth IRA with Wells Fargo but I've also been considering off and on to switch to Chase which has been recommended by friends. Does one have lower fees or something that would be recommendable over the other?
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Jan 23, 2014 01:20
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KoB posted:I'm finally making enough money to be putting some away now. I currently have: It sounds like you're not able to evaluate the different offerings yourself. Start up your Roth IRA with Vanguard and use their target date funds.
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Jan 23, 2014 01:31
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Yeah, I've been with Vanguard a few years now and I've been extremely happy with them. I would also recommend choosing a target date fund until (if you want) you become more knowledgeable about long-term investing. edit: Vanguard 2055 Fund: https://personal.vanguard.com/us/funds/snapshot?FundId=1487&FundIntExt=INT Fees: 0.18% Vs Wells Fargo 2055 Fund: http://www.wellsfargoadvantagefunds.com/wfweb/wf/funds/profiles/profile.jsp?fundNo=3261&BV_UseBVCookie=yes Net Expense Ratio 0.93% Gross Expense Ratio 1.66% Someone correct me if I did this wrong, I just used a calculator online and substituted inflation for the expense ratio: With Wells Fargo assuming a 10% real return over 30 years: end balance $174,494.02 after 1% expense ratio adjustment: $129,461.11 total principal $10,000.00 total interest $164,494.02 With Vanguard assuming a 10% real return over 30 years. end balance $174,494.02 after 0.18% expense ratio adjustment: $165,329.26 total principal $10,000.00 total interest $164,494.02 Difference: $35,868.15 Sephiroth_IRA fucked around with this message at 15:26 on Jan 23, 2014 |
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Jan 23, 2014 14:42
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baquerd posted:It sounds like you're not able to evaluate the different offerings yourself. Start up your Roth IRA with Vanguard and use their target date funds. Do this and read the Four Pillars. After that you'll be able to easily understand Vanguard's offerings and probably have a better idea for your 401k. I picked random crap when I started my 401k, after The Four Pillars I started to understand how poo poo its offerings were but also how I could make a better effort to mix assets with what it does have, until I can finally roll it over into an IRA someday.
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Jan 23, 2014 15:01
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Orange_Lazarus posted:Yeah, I've been with Vanguard a few years now and I've been extremely happy with them. I would also recommend choosing a target date fund until (if you want) you become more knowledgeable about long-term investing. Doing this in Excel, I got these values using compound interest formula: 10,000 * (1 + [0.1 - 0.0018])^30 = $166,128.13 for Vanguard 10,000 * (1 + [0.1 - 0.01])^30 = $132,676.78 for Wells Fargo Slightly off from yours, but not sure why.
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Jan 23, 2014 15:46
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I'm not sure if this is more a tax question or an investment question, hopefully this is the right place. I want to retire early. Let's say I have made $300k in contributions to my traditional 401(k) at that point. Could I convert $60k/year of those contributions over to a Roth IRA (paying whatever income taxes are due at the time), and then withdraw them as contributions (avoiding penalty) for five years until my pension kicks in? If not, is there some other way of doing things that'll let me withdrawal more than the maximum 72(t) distribution amount for those five years without paying a shitload of taxes and/or penalties?
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Jan 23, 2014 17:29
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That was basically my plan as well. You can also take "substantially equal periodic payments" from an IRA but once you start taking them, you can not stop or change the amount until you are 59.5 years old and you have been taking the distributions for 5 years. I haven't really looked into it much myself, decided rolling from a 401(k) to a Roth then withdrawing the contributions would be easier. e: Rereading your post, I think you have to first roll it all to an IRA then convert to a Roth IRA (which is a taxable event so you'd want to roll only so much per year to avoid the majority of the taxes). You can then withdraw those conversions 5 years later. So you'd need to plan on having 5 years worth of expenses covered while you wait for your conversions to be eligible for withdrawal. spf3million fucked around with this message at 17:40 on Jan 23, 2014 |
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Jan 23, 2014 17:37
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Welp, that's no good if I wouldn't need the money any more after five years. I guess Roth IRA contributions + SEPP distributions will come pretty close to meeting my target.
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Jan 23, 2014 18:37
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Uh is there any good portfolio management software you guys could recommend, that's hopefully easy to use? I just want something that will graph how I've diversified my investments and perhaps make suggestions (not necessary at all) of how I could further diversify.
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Jan 23, 2014 19:04
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Orange_Lazarus posted:Uh is there any good portfolio management software you guys could recommend, that's hopefully easy to use? I just want something that will graph how I've diversified my investments and perhaps make suggestions (not necessary at all) of how I could further diversify. I've been happy with http://www.sigfig.com recently, especially their advice section which gave me some good advice on fees i was paying. It may not be as comprehensive as what you want though. Sample (not me): 
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Jan 23, 2014 19:09
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I work for a state and have 3% of my income mandatorily going into the state retirement fund. In addition, they offer a pre-tax and Roth 457(b) that's optional. I've been utilizing this but haven't really been paying much attention to it until recently. I've been using the pre-tax option up until now, but after reading, I'm not sure if the Roth option would be better. My employer doesn't offer any matching. My understanding, after reading this thread, is that I would be better served by moving my contributions from pre-tax to Roth for the 457(b) and then any remainder should go to the pre-tax 457(b). Is this correct? I'm 28 so retirement is not anywhere near.
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Jan 23, 2014 20:12
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Since there's no matching on the 457 I'd say worry about that only if you're maxing an IRA of your own.
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Jan 23, 2014 20:38
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Nail Rat posted:Since there's no matching on the 457 I'd say worry about that only if you're maxing an IRA of your own. No I don't currently have a Roth IRA at all. Ok thanks, I guess I'll open one and start that and put anything leftover in the 457. Vanguard is the recommended company?
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Jan 23, 2014 20:56
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dantae posted:I work for a state and have 3% of my income mandatorily going into the state retirement fund. ... This is like a state pension? That's kinda neat although I always hear about companies and governments having unfunded pensions, which makes no sense to me. What do they offer?
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Jan 23, 2014 20:59
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bathhouse posted:I've been happy with http://www.sigfig.com recently, especially their advice section which gave me some good advice on fees i was paying. It may not be as comprehensive as what you want though. I like the premise of SigFig, and it is certainly better than Mint when it comes to investment tracking, but I've been having nothing but problems with it lately. For one, it randomly decided to stop including my manually entered holdings in my performance, so it caused a huge ~10k drop in all my graphs and stats as if I had suddenly lost 10k. Also for some reason it just cannot seem to connect to my Vanguard accounts, and periodically has a hard time connecting to my Fidelity 401k accounts. It seems to work pretty well with ShareBuilder, though, so I guess at least it has that going for it.
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Jan 23, 2014 21:03
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Orange_Lazarus posted:... This is like a state pension? That's kinda neat although I always hear about companies and governments having unfunded pensions, which makes no sense to me. What do they offer? In the past, at least in my state, the employees were only contributing that 3% (or whatever it was) for a certain # of years before they didn't have to contribute anything at all. Even with interest, I'd imagine that doesn't always cover retirement benefits when you pay 3% of your starting salary and then retire 40 years later at a much higher salary. Newer state employees (like me) have to pay that 3% the entire time we're working. This is my not very financially intelligent guess though, could be entirely wrong. The benefits are dependent upon how many years you worked and your final salary when you retire. You get a percentage of that final salary based upon how many years you worked for the state.
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Jan 23, 2014 21:06
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Orange_Lazarus posted:... This is like a state pension? That's kinda neat although I always hear about companies and governments having unfunded pensions, which makes no sense to me. What do they offer? What these states actually have is underfunded pension obligations. What that means is, they have a fund into which some combination of the state, and the workers, have been paying for years. The state is responsible for paying out a defined benefit to each eligible retiree. That defined benefit (which is usually some kind of guaranteed-for-life payment of monthly pension checks) might be different depending on how long the worker worked, what their maximum salary was, etc. But since it's a pre-determined (or calculatable) amount, the state can estimate what it's total annual payout obligation will be, based on actuarial tables that predict how long its retirees will live, going forward for many years (with increasing uncertainty the farther into the future they project). When the obligation for (say) the next ten years is larger than the projected ability of the funds to generate that much money in earnings, the fund is "underfunded". I'm not sure if they call it underfunded only if (in theory) the fund will have to shrink to make the payouts, or if they already assume the fund will shrink and even then, it's short. There are several reasons why a pension fund could wind up underfunded. The state may have agreed to payouts that were higher than it should have (being fiscally prudent); it may have made unwise (underperforming) investments with the pension fund; it may have over-estimated reasonable investment returns; it may have underestimated how long workers will live; or there may have been fraud or other malfeasance, in the worst cases. Fortunately for most state workers (and a lot of private workers with pension plans), there is a federal insurance program for pensions called the Pension Benefit Guarantee Corp. If a pension belongs to the PBGC, it basically bails out (or takes over, in the case of a private company closing down) underfunded or failing pension plans, to make sure that the workers (who are usually not at fault) still get the payouts they were promised. The PBGC gets its funding by charging participating pension programs a fee, so it's (mostly?) not taxpayer-funded bailouts that happen. In my opinion, nobody should agree to work for a company that has a private pension plan that isn't covered by the PBGC. Or at the very least, if you do work for such a company, you should plan for your retirement as if the money will never be there, because there's a chance it won't be. I'm most familiar with the two biggest state pension funds in California: California Public Employees' Retirement System, CalPERS, and the California State Teacher's Retirement System, CalSTRS. CalPERS has had various news articles in the past few years talking about how they're underfunded, but I think now that the stock market has recovered (and hit new highs), the state budget has recovered, and property values in California have recovered, that both CalPERS and CalSTRS are no longer considered underfunded. Edit: Or maybe they are, depending on who you ask. Leperflesh fucked around with this message at 21:24 on Jan 23, 2014 |
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Jan 23, 2014 21:14
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Guinness posted:I like the premise of SigFig, and it is certainly better than Mint when it comes to investment tracking, but I've been having nothing but problems with it lately. Yeah, right now I'm very happy with what they offer for free since I just needed something that would simply take all of my investments, (my wifes 401k, my Roth IRA, my wife's Roth IRA, taxable account, etc) combine it all into one portfolio and then graph it. What I'm not sure about is their paid service that will rebalance a portfolio automatically. I'm sure there is some definite benefits to regular rebalancing (could someone provide an example? It's been awhile since I've read The Four Pillars) as opposed to just doing it once a year or so but is it really worth it? Also I've been happier since I started taking a hands off approach and only looking at my investments every six months or so. Sephiroth_IRA fucked around with this message at 22:50 on Jan 23, 2014 |
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Jan 23, 2014 22:34
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Aside from the brokerage fees, are there any other reasons to invest in mutual funds rather than their equivalent ETFs? I don't have enough money saved to diversify if I buy into a bunch of mutual funds, due to the minimums, but I can diversify in ETFs. It basically just seems like ETFs are not ideal if you want to invest a small amount of your paycheck once a month. DONT THREAD ON ME fucked around with this message at 00:19 on Jan 24, 2014 |
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Jan 24, 2014 00:09
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Just the fees. But unless you are doing something complicated (and why would you be doing something complicated with only 5 grand?) there is probably already a pre-rolled mutual fund that's pretty much what you want. Also, you can always save up in a separate account and do it all at once at the end of the year, whichever way you go. slap me silly fucked around with this message at 00:22 on Jan 24, 2014 |
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Jan 24, 2014 00:19
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Generally, ETFs must be purchased as whole shares, and due to the bid/ask spread, you may have to purchase for over, or sell below the NAV. With a mutual fund, you can generally buy fractional shares, and will buy them at the end of day NAV.
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Jan 24, 2014 00:23
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slap me silly posted:Just the fees. But unless you are doing something complicated (and why would you be doing something complicated with only 5 grand?) there is probably already a pre-rolled mutual fund that's pretty much what you want. Yeah, but there are a lot of really high yield mutual funds that I don't have access to until I have 100k, for instance: https://personal.vanguard.com/us/funds/snapshot?FundId=0956&FundIntExt=INT#tab=0 Plus dumping what would be a majority of my savings into something that risky wouldn't be a great idea. So maybe go with a mutual fund for the most part, and then take some of that out for ETFs when I want?
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Jan 24, 2014 00:26
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