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Dreadite posted:Have we already covered bond funds in taxable accounts? Is it really a bad idea to hold something like VTB or should I be looking at a tax advantaged bond fund? Does it matter that much if it's purely buy and hold? It depends on your tax bracket. If you're in the 25% and below then it's probably ok to have VTB. If you're above 25 then you should get a muni bond/tax managed bond.
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Oct 22, 2017 21:47
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Dreadite posted:Have we already covered bond funds in taxable accounts? Is it really a bad idea to hold something like VTB or should I be looking at a tax advantaged bond fund? Does it matter that much if it's purely buy and hold? For instance, if you had a top marginal tax rate Fed+State of 33%, BND's SEC yield of 2.41% would be 1.59% return after tax. VTEB's SEC yield is 1.93% (tax exempt). Risk is pretty similar between the two but would make more sense holding VTEB in this case. (Calculations are not really correct, but just an illustrative example). Generally, I would say don't bother too much worrying about ~tax efficiency~, the most important factor is still what risk-reward you're willing to accept for them, but it's still worth doing some simple calculations based on expected return and tax to compare some differing funds. Like I don't hold corporate bonds even though I'd get more return, even after taxes, from holding them vs my holding of muni bonds, but that's because I don't accept the risk associated with them as I already hold corporate equities (VOO/VTI) and want something decoupled from corporate performance. Xaris fucked around with this message at 04:48 on Oct 23, 2017 |
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Oct 23, 2017 04:08
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Thanks, that's a great explanation.
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Oct 23, 2017 16:20
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https://twitter.com/realDonaldTrump/status/922428118685581313 very trustworthy man assures us it'll be fine
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Oct 23, 2017 16:54
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InfrastructureWeek posted:https://twitter.com/realDonaldTrump/status/922428118685581313 Okay NOW I'm worried.
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Oct 23, 2017 16:54
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InfrastructureWeek posted:https://twitter.com/realDonaldTrump/status/922428118685581313 Good thing I have a 457b! 
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Oct 23, 2017 18:52
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I’m going to be changing jobs soon. Assuming Trump and company don’t facefuck the standard retirement strategy (big if), what do I do with the 401k that my current company has been keeping? Do I just roll it into my Vanguard Roth IRA? Will I still have access to my 401k after I leave, or should I roll it in before my tenure at the company ends?
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Oct 23, 2017 19:57
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InfrastructureWeek posted:https://twitter.com/realDonaldTrump/status/922428118685581313 While I don't trust him, this puts a spotlight on the issue. It seems like the GOP was trying to do this as quietly as possible. This is going to piss the gently caress out of their base if they keep trying it, and they can't be happy that the Cheetoh undermined both their position and their subterfuge.
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Oct 23, 2017 20:02
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Pollyanna posted:I’m going to be changing jobs soon. Assuming Trump and company don’t facefuck the standard retirement strategy (big if), what do I do with the 401k that my current company has been keeping? Do I just roll it into my Vanguard Roth IRA? Will I still have access to my 401k after I leave, or should I roll it in before my tenure at the company ends? What you probably want to do is, is roll your 401k over to an individual IRA account (which you will open if you don't have one, not a roth one) at place of your choosing like Vanguard or etrade or whatever. You should be able to keep access to your current 401k after you leave, and you can usually leave your money there as long as you like, even forever (I think some places will force you move your money, most won't). You probably don't want to leave your money there though because 1) it's easier to manage and keep track of it if you have all your money in one place (plus you'll have better investment choices) 2) sometimes after you aren't an employee the 401k company will say 'hey thanks for sticking with us, now we're gonna charge you 8$ a month management fee since your employer used to pay us that'.
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Oct 23, 2017 20:02
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Nail Rat posted:While I don't trust him, this puts a spotlight on the issue. It seems like the GOP was trying to do this as quietly as possible. This is going to piss the gently caress out of their base if they keep trying it, and they can't be happy that the Cheetoh undermined both their position and their subterfuge. Especially since it's an utterly unreliable denial - there's absolutely zero chance that Trump vetoes the first major piece of Republican-led legislation to actually make it to his desk. If Congress cuts 401(k)s in a tax reform bill, Trump is 100% signing it no matter what, and then he's going to loudly and repeatedly take (steal) credit for it forever. He'll openly and blatantly lie about its contents while doing so, too. And everyone involved knows it. So yeah, this tweet accomplishes absolutely nothing good for him, his party, or congress. It doesn't even really speak to his base.
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Oct 23, 2017 20:13
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tax capital gains as regular income qtiyd
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Oct 23, 2017 21:19
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no but you see if captains of industry had to pay as much tax as us normal scrubs, why, they wouldn't even bother with investing, and then where would we be e. something something grandma's house death tax regulations small business
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Oct 23, 2017 21:26
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Pollyanna posted:I’m going to be changing jobs soon. Assuming Trump and company don’t facefuck the standard retirement strategy (big if), what do I do with the 401k that my current company has been keeping? Do I just roll it into my Vanguard Roth IRA? Will I still have access to my 401k after I leave, or should I roll it in before my tenure at the company ends? You roll the money into an IRA with the same tax treatment as your 401k money. Trad to Trad, Roth to Roth. If you have a mix of both, then you need that in the destination as well. It's easy to do and means you are no longer at the whims of your old companies asset and fee strategy. It's really easy to do, it cannot be done until you're no longer active at the old company, and if you have questions the receiving institution will gladly help you out. There is only one reason I can see to keep it at your old job: Access to institutional class funds. (Mutual fund classes tend to go ~$2.5k, $10k, $1MM to invest with fee structures eroding as you go up.) You can easily see this for yourself by punching in your ticker symbol(s) to google and looking at their "Fees & Minimums" or whatever it's call on the site you choose.
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Oct 23, 2017 21:44
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H110Hawk posted:You roll the money into an IRA with the same tax treatment as your 401k money. Trad to Trad, Roth to Roth. If you have a mix of both, then you need that in the destination as well. It's easy to do and means you are no longer at the whims of your old companies asset and fee strategy. It's really easy to do, it cannot be done until you're no longer active at the old company, and if you have questions the receiving institution will gladly help you out. Does this mean you can no longer do the backdoor Roth manuever? If I roll $30,000 of traditional 401k money into a traditional IRA, next year I can't contribute $5,500 to the traditional IRA and then transfer it to a Roth, correct?
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Oct 23, 2017 22:29
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Kylaer posted:Does this mean you can no longer do the backdoor Roth manuever? If I roll $30,000 of traditional 401k money into a traditional IRA, next year I can't contribute $5,500 to the traditional IRA and then transfer it to a Roth, correct?
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Oct 23, 2017 22:51
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Hoodwinker posted:Somebody correct me if I'm wrong but you can open more than one IRA of each type. You could just open a different Traditional IRA for this purpose, I believe. Nope. The relevant entity is the IRS, not the IRA provider. The IRS only cares about the sum of all your IRAs. Kylaer, you're essentially correct (you can still do it, but you'll be paying lots of taxes). That's the other good reason to keep money in a 401k, if you anticipate making enough money that you'll want to use the backdoor Roth IRA.
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Oct 23, 2017 23:16
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He won't be paying taxes if he roles from a 401k to a traditional IRA (both pretax).
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Oct 23, 2017 23:28
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simble posted:He won't be paying taxes if he roles from a 401k to a traditional IRA (both pretax). That's true, but a significant traditional IRA balance will make future taxes on the backdoor Roth IRA conversion much higher. The backdoor Roth strategy is really only feasible for people who have small-to-zero traditional IRA balances, or who actively want to pay income taxes to get the conversion done (which is arguably a decent strategy if you're capped out on both 401(k) and IRA individual contributions and want to squeeze a few more effective dollars into tax-advantaged space).
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Oct 24, 2017 02:21
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Good-Natured Filth posted:I started a new job yesterday and during the orientation, the HR person told me that I'd be auto-enrolled to our 401k with a 5% contribution if I don't make a custom election within 60 days. She wanted to "warn" me because a lot of employees get upset when the company "starts taking more money" from them. People really don't want to save for retirement. Auto-enroll is a public service. It's amazing how many people who out there who don't understand the concept of an employer match. Free money isn't attractive to some if it can't be spent immediately.
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Oct 24, 2017 02:30
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Alhireth-Hotep posted:Nope. The relevant entity is the IRS, not the IRA provider. The IRS only cares about the sum of all your IRAs.
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Oct 24, 2017 05:48
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Pollyanna posted:I’m going to be changing jobs soon. Assuming Trump and company don’t facefuck the standard retirement strategy (big if), what do I do with the 401k that my current company has been keeping? Do I just roll it into my Vanguard Roth IRA? Will I still have access to my 401k after I leave, or should I roll it in before my tenure at the company ends? You have to wait until you leave to roll over. You can't roll over while you'e working there. As far as where it goes, it's personal preference. For me, when I left my previous job, I was excited to be able to roll it all into Vanguard. The pre-tax rolls into a Trad IRA, any post tax 401k rolls into your Roth. I also didn't like my pre-tax/post-tax split. Since I was maxing out my 401k pre-tax, plus getting a pre-tax match, and Roth is limited to $550, I had a lot more pre-tax money than post tax money, so I took it as an opportunity to backdoor a chunk. I still have about a 4:1 ratio of pre-tax/post-tax, but that's fine. It's just not realistic for me to ever get it where I'd like it, around 2:1, just due to matching and my contributions having little impact overall to my balance. Of course, once I transferred it all into Vanguard, I found it a pain in the rear end and I hate it, and when I started my new job, I rolled all of my pre-tax into my employer 401k. I prefer having it all in one place so I can just balance it on swoop. My Roth that is in Vanguard is in a target retirement, just because I hate Vanguard's website, and doing rebalancing is a pain in the rear end with them. My employers website is much easier. I click one button and it all reallocates to my desired allocations.
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Oct 24, 2017 13:52
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Hoodwinker posted:Sorry I misunderstood the previous goon's question. Rolling over won't affect the contribution limit, that much I know, but in order to do a backdoor Roth generally requires rolling Traditional contributions that haven't acquired gains yet, hence my comment about opening a new account. paternity suitor posted:Of course, once I transferred it all into Vanguard, I found it a pain in the rear end and I hate it, and when I started my new job, I rolled all of my pre-tax into my employer 401k. I prefer having it all in one place so I can just balance it on swoop. My Roth that is in Vanguard is in a target retirement, just because I hate Vanguard's website, and doing rebalancing is a pain in the rear end with them. My employers website is much easier. I click one button and it all reallocates to my desired allocations.
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Oct 25, 2017 00:33
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Ralith posted:What do people have against Vanguard's website? It always struck me as rather nice. I don't get this beef, either. It's not flashy or sexy but who cares. It is clean, clear, and shows you all the information you need to know without a bunch of obnoxious garbage or advertisements. I think Fidelity's site (at least for 401k) is way more of a mess than Vanguard's. Guinness fucked around with this message at 00:38 on Oct 25, 2017 |
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Oct 25, 2017 00:35
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Ralith posted:The IRS does not care which IRA the money comes from.
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Oct 25, 2017 00:47
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Ralith posted:What do people have against Vanguard's website? It always struck me as rather nice. It's sparse and functional. I like it. It's totally not web 2.<whatever we're on now>. I'm completely fine with that. It looks positively barbaric compared to the bling of the eTrade Pro app, where you can feel like a Real Trader (TM) for free with $500k in your accounts (which I recently lost access to because I mostly only use Etrade because it's my company's stock plan choice). I don't feel like I need any of those things as a passive investor. Vanguard is fine (web site). And very very good where it counts the most.
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Oct 25, 2017 01:18
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If you want a garbage website look no further than Fidelity. That place is a total mess
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Oct 25, 2017 02:01
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Rex-Goliath posted:If you want a garbage website look no further than Fidelity. That place is a total mess Their trading site is just as bad as the 401(k) plan administrator site? I guess I shouldn't be surprised. I can still find the poo poo I need on there, but it is a dumpster fire.
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Oct 25, 2017 14:51
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Rex-Goliath posted:If you want a garbage website look no further than Fidelity. That place is a total mess Schwab. Their ESPP site has an entire "This is our fancy new look and feel!" front end, but in order to actually do anything you've got to click a link at the top that takes you back to their old web page because they haven't actually built in any functionality yet. It's really annoying.
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Oct 25, 2017 16:12
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Now that I work for a company with a real 401k and matching options, I'm curious. The standard rule is 401k up to the match, Roth IRA, then finish the 401k, right? My company also has a match eligible Roth 401k option. So would I be doing 401k up to the match, max out my Roth 401k contribution, then max out my 401k?
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Oct 25, 2017 16:22
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1. Even though your company offers a Roth 401k, I’m 99% sure they don’t match into it. Company matches will be deposited into a pretax 401k even if you contribute to Roth 401k. 2. You should max Roth IRA before maxing your 401k (of any flavor). Roth IRAs are superior because they offer better fund choice, are personally controlled, and allow you a simple early-withdrawal option. 401k to match max Roth IRA Max 401k Roth vs Traditional 401k is pretty much a wash. I’m a fan of traditional 401k because I like the income tax reduction now and I plan on taking low amounts (30-50k/yr) out in retirement that will be taxed less than I get taxed now. Roth vs Traditional IRAs are handled differently by the IRS, and Roth IRAs are superior for several reasons.
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Oct 25, 2017 16:37
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The wording in the plan info makes the think the Roth match is possible, but it's really not worth pressing on. As for the rest, I guess I'll stick to the original plan.
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Oct 25, 2017 16:42
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Fhqwhgads posted:The wording in the plan info makes the think the Roth match is possible, but it's really not worth pressing on. As for the rest, I guess I'll stick to the original plan. If it's more money you can get matched, yes it's worth pressing on. Ask your HR.
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Oct 25, 2017 18:31
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Thrift savings plan question as my Google fu is weak. With the new 18.5k TSP limit, that's 712 per pay period assuming biweekly pay?
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Oct 25, 2017 18:53
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Evil SpongeBob posted:Thrift savings plan question as my Google fu is weak. With the new 18.5k TSP limit, that's 712 per pay period assuming biweekly pay? Twice a month (1st/15th for example) 12 * 2 = 24 Bi-weekly (every other week) 52 / 2 = 26. $18,500 / 26 = 711.5384615385, so $712 should cap you out and your last paycheck will be slightly larger by a few dollars.
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Oct 25, 2017 19:32
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Yeah, but it gets wierd because December's 2017 last pay hits accounts in January. I don't know if that counts as the 27th PP.
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Oct 25, 2017 19:50
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Evil SpongeBob posted:Yeah, but it gets wierd because December's 2017 last pay hits accounts in January. I don't know if that counts as the 27th PP. Nah, they do it by calendar year so it's always the Tuesday after payday (usually Monday.) As long as that Tuesday falls in that calendar year, it could be 27 PP but doubtful.
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Oct 25, 2017 20:09
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Okay, so let me get this straight: I have a pre-tax 401k that I’m contributing to at work. After I leave and am no longer at the company, I log onto Vanguard or whatever site my company uses for 401k management, and roll it into a a new IRA. This IRA has to be traditional, since I’m going from a pre-tax 401k to an IRA that is also pre-tax and therefore much be traditional and not Roth. So now I have two IRAs: my Roth, and my traditional. I contribute $5.5k post-tax (i.e. directly from my bank account) yearly to my Roth IRA, and leave my trad IRA alone while rolling whatever employer’s pre-tax 401ks I get into it if/when I move on. Would I do the same for any post-tax 401ks from an employer? Roll it into the Roth IRA after I leave? Do I roll it into a new IRA every time, or just roll it into what’s already available? What I mean is, do I need more than just one Roth IRA and one traditional IRA? Or will only those two be sufficient?
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Oct 26, 2017 15:38
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Pollyanna posted:Do I roll it into a new IRA every time, or just roll it into what’s already available? What I mean is, do I need more than just one Roth IRA and one traditional IRA? Or will only those two be sufficient? One of each is fine, but once you have mixed 401k money and regular ira contributions in a single account you can never roll it into another 401k. If you want to keep your options open then open a distinct ira for 401k rollovers. This maxes you out at 4. Personally I have 2 and have comingled (mixed) the money.
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Oct 26, 2017 15:42
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My 403b plan through TIAA-CREF was recently changed dumping the old funds in favor of "ones with better long-term performance" and even the index funds have expense ratios of like 0.60% now. When I asked them about it our "retirement consultant" sent me a couple paragraphs about how "costs should be secondary to performance" which... okay. Is everything that performed unusually well over the last 5 years going to continue performing unusually well for the next 30 years? Is that the way it works
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Oct 26, 2017 17:00
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secret volcano lair posted:My 403b plan through TIAA-CREF was recently changed dumping the old funds in favor of "ones with better long-term performance" and even the index funds have expense ratios of like 0.60% now. No, it isn't. There's a pending whistleblower complaint against TIAA for trying to convert people to higher-fee managed accounts, which doesn't sound like what's happening in your case but does make me wonder what's going on with the management there.
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Oct 26, 2017 17:23
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