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cheese eats mouse posted:Did everyone abandon this thread for discord?
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Jun 26, 2020 17:04
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You probably also want someone with a more specific specialization in whatever you need advice on, unless the advice needed is quite generic.
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Jun 26, 2020 17:09
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Edit to protect my jerb
cheese eats mouse fucked around with this message at 17:18 on Jun 26, 2020 |
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Jun 26, 2020 17:14
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you definitely want someone familiar with that specific scenario, which fortunately is not super uncommon
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Jun 26, 2020 17:16
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Awesome. TY! I'll do more research this weekend.
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Jun 26, 2020 17:19
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Also I think you're probably safe to ask general questions if nobody knows who you are or where you work.
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Jun 26, 2020 17:21
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yeah what was posted has been discussed in general terms by mad equity holding goons before. i understand being cautious but this seems to be verging in to paranoia
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Jun 26, 2020 17:26
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I've been trying to help goons get jobs at my company currently so it's easy to figure that out.  Thank you though. I have some local resources through my partner too.Not trying to be paranoid, just don't know where I'm crossing a line y'know?
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Jun 26, 2020 17:26
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H110Hawk posted:One thing I would worry about with that 80% concentration with 0 leverage is how do you fund "tenant smoked and pissed on the walls and stole all the copper then skipped town. Also has no money now." style repairs? Or 6 month vacancy and its impact on your insurance and cashflow for life? Do you have a line of credit you can draw down? I'm unfamiliar with EU laws - are they inside of a "company" of any sort? How are you personally shielded from liability? I used to have 2 or 3-month vacancies during summer sometimes but then I wisened up, started offering fixed-term contracts instead of flexible and since then vacancies are just not an issue. If a fire broke out it or something similar happened being incorporated would not help. How does it work in US? Each property is owned by different LLC and mortgaged so when it gets sued one just declares bankrupcy on that given LLC, let the bank foreclose and move on? H110Hawk posted:Or [unexpected event] and its impact on your insurance and cashflow for life?
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Jun 26, 2020 18:52
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Maurice I think the issue is less about what your market is like today, and more about what your market might become in the unknowable future. Diversification is a proven method for reducing exposure to a couple of different kinds of risk, because sometimes there are events that strongly affect an entire asset class but don't strongly negatively affect other asset classes. To be clearer: it could happen that in five years there is a sudden downturn in the real estate or rental markets. Or perhaps they could have a slow slide downward for 20 years. Japan is usually pointed-to for examples of what is, in theory, possible. You could reduce the degree of your losses by moving some of your assets into uncorrelated or less-correlated asset classes. You haven't said, but an additional risk would exist if most or all of your real estate investments are in a concentrated geographical area. A single city, or region, or even country, could have a real estate crisis (natural disaster, regulatory change, political crisis, etc.) that doesn't affect other cities/regions/countries. Even if you're determined to stay mostly in real estate, it would be to your advantage to diversify geographically in order to hedge against those kinds of risk. I would suggest that a target for your research in the next period would be to learn about and understand the principles of asset diversification.
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Jun 26, 2020 19:13
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cheese eats mouse posted:tech person chat Sounds like you want general advice on what other goons do with company shares should they have a liquidity event. The answer is sell them. You will pay mountains of taxes but that's OK. If said goon is a 10% holder/director/executive (as in, checked on the SEC filings) then said goon lives and dies by their 10b5-1 plan and corporate counsel will help you out. If you cannot be loaned money for cashless exercise due to corporate governance then call up your local megabank and tell them you're about to become rich and need to talk to their private bank department. They will help you with a loan collateralized on the sale of the stock. Some of my coworkers have held and sold in tranches over time to get LTCG treatment and to hedge on the price going up. They have made a LOT more money than me. They could have made less if the stock went down. That is a risk you have to evaluate for yourself. I would buy in to any ESPP program that comes of this. I would at a minimum sell off enough to give yourself a healthy cushion in your life. I would have grossed literally a million more dollars if I held everything to the most recent trading window but I do not regret selling as I went along. Even just doing LTCG I would have netted an extra few hundred thousand through increased sale price and lowered tax burden. Share prices can go down just as readily as they go up though. This is all general advice regardless of where you work and when or if they ever have a liquidity event. Maurice Augustus posted:If a fire broke out it or something similar happened being incorporated would not help. How does it work in US? Each property is owned by different LLC and mortgaged so when it gets sued one just declares bankrupcy on that given LLC, let the bank foreclose and move on? Markets can turn. Leverage doesn't have to be dangerous, just want to ensure that your non-real estate savings can help you weather a real estate storm, and leverage can help. One way to do that is with a revolving line of credit. It's also why I suggest a much more modest % of leverage. In the USA you could with standard paperwork leverage all of this to 75% at ~3.5% interest for 30 years, but that isn't what you want, nor do I think it's prudent. For the USA I'm thinking liability in the event of negligence. This is an extreme example that uses hyperbole to make its point so please take it with a grain of salt, limits and values are all made up to illustrate a point. Your tenant tells you several times that the locks on your doors are faulty and the stairs are slippery when wet. Their child escapes because the door cannot be locked, falls down the stairs, and dies. They take out another child on their way down the stairs and they also die. You are sued, lose, and owe them $1 Million/head for the pile of dead children at the bottom of your slippery stares, you monster. You have liability insurance that covers $1MM, and you sell the apartment for $500k, leaving you with $500k in liability. If you own these houses directly then the rest of your assets attach to the judgement, you sell your second apartment for $500k and now you are settled. If everything is owned correctly by LLC's the $500k is dissolved in bankruptcy, you monster. If you haven't I would check with an attorney (solicitor? barrister? whatever they call them in your country) to make sure you understand your liability. How do owners of large apartment complexes keep their fortunes from being tapped beyond the insurance value of the building should the building be made with flammable paint and balsawood and burn down taking everyone inside with them? In both examples you lose assets and income, but one you lose 1/Nth the income, where N=number of apartments you have on average paying rents. Leperflesh has much better general examples and prose than I do, but I think it would make sense for a certain amount of diversification here. If I were in your shoes I would try to have a 1 year warchest amassed - living expenses, all business expenses (maintenance, advertising, taxes, etc, on these apartments) - to help you weather the storm. Maybe you have that today. That part is a bit ambiguous in your posts. H110Hawk fucked around with this message at 20:06 on Jun 26, 2020 |
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Jun 26, 2020 20:01
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H110Hawk posted:Sounds like you want general advice on what other goons do with company shares should they have a liquidity event. The answer is sell them. You will pay mountains of taxes but that's OK. If said goon is a 10% holder/director/executive (as in, checked on the SEC filings) then said goon lives and dies by their 10b5-1 plan and corporate counsel will help you out. If you cannot be loaned money for cashless exercise due to corporate governance then call up your local megabank and tell them you're about to become rich and need to talk to their private bank department. They will help you with a loan collateralized on the sale of the stock. Every time you post about this, the specifics you mention basically 100% line up with mine. Right down to the literally grossing a million more dollars if I waited to sell. I regret nothing. I made a plan that fit my risk profile and I followed it. I'm continuing to follow it.
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Jun 26, 2020 20:25
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What’s the simplest way to start a traditional IRA? I am a freelancer, and I think traditional is what I want so I can discount the amount from my yearly taxes. True? I have a stash account but I’m not sure if they do IRA
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Jun 26, 2020 20:39
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cheese eats mouse posted:I legit need a fiduciary financial advisor that can help me with some tax consequences. I had some confidential stuff at work come up yesterday and really am not sure how to proceed. Would rather hire a goon.
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Jun 26, 2020 20:50
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H110Hawk posted:Sounds like you want general advice on what other goons do with company shares should they have a liquidity event. The answer is sell them. You will pay mountains of taxes but that's OK. I was thinking this too since I have some high-interest debt I could pay down with it for the instant return (or help max my roth this year not sure) and it's monopoly money until there is another event. I'm still limited about what I can sell and will still be holding some monopoly money. It's really not much, but still cash I wouldn't have without this event. I've only been with my company for a year so I'm not sure if it short or long term but in our mtg they said it would be ordinary income. I know what most of this means, dexter6 posted:Might be able to find someone here: https://www.napfa.org/find-an-advisor Thanks! cheese eats mouse fucked around with this message at 22:19 on Jun 26, 2020 |
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Jun 26, 2020 22:01
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cheese eats mouse posted:I was thinking this too since I have some high-interest debt I could pay down with it for the instant return (or help max my roth this year not sure) and it's monopoly money until there is another event. I'm still limited about what I can sell and will still be holding some monopoly money. It's really not much, but still cash I wouldn't have without this event. I've only been with my company for a year so I'm not sure if it short or long term but in our mtg they said it would be ordinary income. I know what most of this means, but would still like someone to help guide me through the tax side of it all since they're not withholding taxes. Ordinary income is the exact same as w-2 income. Add it to your income for the year, look at the tax tables. Multiply the amount by the various bracket(s) that new income traverses. Save it until next year and pay the taxes on April 15th. It is not capital gains so short and long term don't matter. I forget the numbers but let's say it goes from 15% to 20% at $100k. (it doesn't, play along.) you have a $90k salary, no bonus, and are going to get $20k in hookers and blow money. $10k * 15% + $10k * 20% = federal taxes owed. Do the same with the state income taxes as well. You can be more exact by computing in things like your 401k ($90k - traditional 401k withholdings), etc etc etc. But because you probably don't already owe quarterly taxes you can just wait to see how it shakes out. Edit: if this isn't going to make you a several hundred thousands-aire overnight we can help you once you have public news and real numbers. Even if it does we can but up to you. You have until April 15th 2021 to get it right. H110Hawk fucked around with this message at 22:27 on Jun 26, 2020 |
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Jun 26, 2020 22:25
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My company gives bonuses in both RSUs and S-SARs. (It’s already public.) The RSUs I plan to immediately exercise and sell upon vesting, but I’m not sure how to think about the SARs. I get how they work but I’m having trouble mapping that to my own risk profile. For example, if I also exercise and sell them immediately upon vesting, they’re effectively crappier RSUs. It might just be that that’s the case and it sucks, but nobody writes “How to best utilize SARs” guides.
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Jun 27, 2020 00:51
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raminasi posted:My company gives bonuses in both RSUs and S-SARs. (It’s already public.) The RSUs I plan to immediately exercise and sell upon vesting, but I’m not sure how to think about the SARs. I get how they work but I’m having trouble mapping that to my own risk profile. For example, if I also exercise and sell them immediately upon vesting, they’re effectively crappier RSUs. It might just be that that’s the case and it sucks, but nobody writes “How to best utilize SARs” guides. The WHOLE loving WORLD is trying not to get SARS-CoV-2 right now and here your company is spreading it intentionally? RSU's are not "exercised" - they are real units which you own, and as you "vest" the "Restriction" (Restricted Stock Unit) is removed leaving you with just the underlying equity and a taxable event. If you vest 1 RSU worth $100 you owe $100*Tax_Rate in taxes immediately and now own 1 share of the company stock. Which you should then sell. Having googled and read several sentences on what a S-SAR is it sounds like an option with different complications in that they just give you the upside in compensation. Sounds like money to me, but you don't have the option to hold them longer to make more money. It's basically a profit sharing plan. Cash them out like you would any other equity in the company. https://www.investopedia.com/terms/s/sar.asp tl;dr Always Be Selling.
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Jun 27, 2020 01:39
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tumblr hype man posted:Your current efforts are the best solution to this problem, otherwise you are exposed to massive losses related to your short. H110Hawk posted:Don't. You have a great solution already. Betting on the downfall of your competitors is betting on the success of your company or the destruction of your industry. That's just reconcentrating your risk back into your industry. Thank you both.
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Jun 27, 2020 02:12
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Man I got the shaft with my ESPP this round. My company was in the process of being bought and going private, so the selling was restricted until the merger was completed. But then they backed out of the merger and the stock tanked! Now Im sort of forced to decide to eat a loss or wait and see if the lawsuit forces the merger to happen.
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Jun 27, 2020 07:09
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Leperflesh, H110Hawk thanks for involved replies. Gonna take a better look at my liability.
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Jun 27, 2020 09:23
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H110Hawk posted:Having googled and read several sentences on what a S-SAR is it sounds like an option with different complications in that they just give you the upside in compensation. Sounds like money to me, but you don't have the option to hold them longer to make more money. It's basically a profit sharing plan. Cash them out like you would any other equity in the company. Here’s where this falls down for me: Say they’re underwater when they vest. Obviously I wouldn’t exercise them then, because it’d be throwing them away for nothing. But how much of a gain do I wait for? They take ten years to expire.
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Jun 27, 2020 16:28
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devilmonk posted:What’s the simplest way to start a traditional IRA? I am a freelancer, and I think traditional is what I want so I can discount the amount from my yearly taxes. True? I have a stash account but I’m not sure if they do IRA Sorry to quote my own post; not sure if it’s a dumb question or if it just got missed 😔
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Jun 27, 2020 17:23
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devilmonk posted:Sorry to quote my own post; not sure if it’s a dumb question or if it just got missed 😔 https://investor.vanguard.com/ira/iras
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Jun 27, 2020 17:41
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devilmonk posted:What’s the simplest way to start a traditional IRA? I am a freelancer, and I think traditional is what I want so I can discount the amount from my yearly taxes. True? I have a stash account but I’m not sure if they do IRA
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Jun 27, 2020 18:07
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raminasi posted:Here’s where this falls down for me: Say they’re underwater when they vest. Obviously I wouldn’t exercise them then, because it’d be throwing them away for nothing. But how much of a gain do I wait for? They take ten years to expire. If they're spending a bunch of time being in and out of the money it becomes more ambiguous as to when to exercise them. If you get $100 worth of profit and make $160k/year I would let it ride. If it's enough to add a paycheck? Maybe sell em. If it's suddenly enough to add a few months salary? Sell sell sell!
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Jun 27, 2020 18:23
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So I opened babby's first Roth IRA through Vanguard. I have $4k in it right now, some excess savings that I had. Right now it's sitting in a "Vanguard Federal Money Market Fund" which (correct me if I'm wrong, I'm new at this) I think means it isn't doing anything for me. If I want to sit on this for a few years and let it grow with moderate risk, where should I put it?
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Jun 29, 2020 15:05
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CornHolio posted:So I opened babby's first Roth IRA through Vanguard. I have $4k in it right now, some excess savings that I had. Since you’ve opened a Roth IRA, I’m assuming you intend to use this for retirement. And if that’s so, your investment should be based on a long-term horizon. But, since you’ve also mentioned “sit for a few years”, I’m wondering what your plan for the money is. General wisdom is that, if you have a specific use for the money in the next 5-10 years, it should not be invested in volatile things like the stock market. So - is this long-term/retirement money or short-term/“down payment” money?
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Jun 29, 2020 15:24
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Taking money out of an IRA before retirement is complicated, if you need this money before retirement then it shouldn't have gone in an IRA. Anyway, invest it in an index fund targeted at whatever year you will need it (hopefully retirement).
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Jun 29, 2020 15:26
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dexter6 posted:Yep, you’re correct so far! it's money I could use in the next few years, though supplementing my retirement is what I probably should use it for. My retirement is underfunded at the moment (70kish right before the coronavirus stuff hit, I don't know how much it's bounced back) and I'm 38. withak posted:Taking money out of an IRA before retirement is complicated, if you need this money before retirement then it shouldn't have gone in an IRA. Why would it be complicated? I've already paid taxes on it. I don't think I'm planning on taking it out but but I'd like to know what the penalty would be. CornHolio fucked around with this message at 16:39 on Jun 29, 2020 |
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Jun 29, 2020 15:48
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CornHolio posted:Why would it be complicated? I've already paid taxes on it. I don't think I'm planning on taking it out but but I'd like to know what the penalty would be. quote:KEY TAKEAWAYS
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Jun 29, 2020 17:01
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CornHolio posted:
That fund does pay interest, it fluctuates but will generally be in the vicinity of what a high-yield online savings account will pay (very little, with today's interest rates). Unlike a savings account, it is not FDIC insured, although if Vanguard goes bust the whole economy has probably imploded.
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Jun 29, 2020 18:49
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Okay so generally speaking if I put $4k in I can always take $4k out with no penalties or limitations, I just can't take anything that $4k has earned out. Correct?
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Jun 29, 2020 19:06
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CornHolio posted:Okay so generally speaking if I put $4k in I can always take $4k out with no penalties or limitations, I just can't take anything that $4k has earned out. Correct? I had a similar question on Discord, and the answer is yes. However, anything you take out you can not add back in after the fact. You will lose that contribution space permanently. There is also the risk, if you invest the funds, that you will actually lose money.
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Jun 29, 2020 19:34
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drive me nuts to school posted:However, anything you take out you can not add back in after the fact. You will lose that contribution space permanently.* * You have 60 days to put it back in! This is considered a "rollover", just happens to be from an account to the same account. You can only do this once Cassius Belli fucked around with this message at 20:57 on Jun 29, 2020 |
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Jun 29, 2020 20:23
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Also as you said, you're considerably behind on retirement investing. The tax advantage of the IRA gives you the biggest benefit by leaving the money in there for the longest amount of time (because you'll pay no capital gains taxes or distribution/dividend taxes while the money grows). You should max your IRA contributions ($6k per year), and so should your wife (another $6k per year, which can come from your income if need be), maximize other tax advantaged space (such as a 401(k)), etc. as much as you can. And if you have shorter-term needs, OK, save for those too, but with the clear understanding that taking a thousand dollars out of your retirement funds today, is like taking double or triple that out of the hands of future retired-you. So the standard recommendation from this thread is to invest in some variety of the classic three-fund portfolio for your retirement money. Your "portfolio" is all of your retirement money, so if you have an IRA and also a 401(k) for example, consider all of the money together. The three funds represent your investments in the US stock market, the US bond market, and then international stock markets. You can expand that into four funds if you want to add an investment in REITs or something, but three funds is a good place to start. And, if you're not sure right now what proportion to put in each of the three funds? You can pay a very small increase in expense ratio and just put all the money into a single target date retirement fund, such as https://investor.vanguard.com/mutual-funds/profile/VFIFX which is a 2050 target date (they're available in 5-year increments, just choose the date closest to when you anticipate retiring). This fund is a fund-of-funds that creates a balance appropriate for your age, and gradually shifts that balance as you get older and closer to the target date. So tl;dr, until you think you know better, feel free to put 100% of your IRA money into VFIFX or its equivalent. Then, grab some of the reading material from the first post, and follow the thread for a while, and eventually you can pick a different balance/portfolio when you're more confident about how to do that. Right now you have so little money in there that it doesn't really matter if you get the allocation "wrong" - it's far more important to pile up money in contributions. The asset allocation will matter more when you have like $100k+ in there and differences of a few percent in performance vs. higher volatility due to risk will actually significantly affect how much money you'll retire with.
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Jun 29, 2020 20:32
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Leperflesh posted:Also as you said, you're considerably behind on retirement investing. good useful post but let's give him a little credit: he's actively involved in his retirement planning now and seeking help from a useful place. and lots of people have zero in retirement savings. bravo to anyone putting money away and learning about this stuff.
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Jun 29, 2020 20:43
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I was there at the beginning of the CornHolio Saga, and I hope he knows I give him loads of credit. He's a BFC success story! I'm very proud.
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Jun 29, 2020 20:48
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Leperflesh posted:I was there at the beginning of the CornHolio Saga, and I hope he knows I give him loads of credit. He's a BFC success story! I'm very proud. Yeah I wouldn't be asking these kinds of questions if I hadn't literally been saved from financial ruin by this very forum. I also have about $16k in savings and a whole life policy (my dad took it out a long time ago for me) worth $7k that I'm trying to figure out what I want to do with... at the same time though, I want to start remodeling parts of my house and am trying to determine how much I can safely afford. I refinanced my house last year, pulling $20k out for windows and taking advantage of a better rate, so I can't use that option again right now. Leperflesh posted:
I think all of my 401(k) stuff has been in a 2050 target date fund. I only recently learned how it worked, though.
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Jun 29, 2020 21:21
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$16K sounds light for an emergency fund - how many months of expenses does that cover?
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Jun 29, 2020 21:54
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