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1. Since you have a fixed, known time of wanting to buy, you should either keep them in a savings account or buy a CD that expires at the time you're aiming for. I don't know where to find lists of CD yields but I'm sure someone here can help you. 2. No, because you don't get the opportunity to make up that tax-advantaged space in a future year, and you really want to maximize use of tax-advantaged space.
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Oct 15, 2020 18:05
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seiferguy posted:I'm starting a new job on Monday, that's gonna give me a higher base salary and also equity / RSUs as a part of my total comp. My main goal is probably to buy a house in a couple of years, and my strategy had been saving roughly $2500 a month (so, $30k a year), and on top of that I have roughly $30k saved, so in 2 years I should have $90k in savings plus I can sell some / all of the equity I'll have as necessary plus any money from my girlfriend / partner that she gets as part of her comp. I'll probably house hunting in the south bay area and looking at houses they're around $1mil, so it'd be easy to have at least 10% for a down payment provided housing prices don't get even crazier. I have a plan to max my yearly roth contribution and I'll be contributing 10% of my salary (this won't get me to the 18k max but close) to my 401k while my employer will match around 4%. My questions: 1. Leave it. FDIC insurance is what you're buying. Consider that hmbradley account people are pimping here. 2. Eh, your choice, at $170k/year comp though a $1M house is going to be a painful payment, at least to me. Also the 401k max is $19,500. I would max this and likely save a little longer to make up the difference. Hopefully your new higher salary and equity can make this up. 3. Money for a legal contract with your unmarried house buying partner. You must do this (or get married) if she is going to be having an equity interest in the house. Otherwise, just charge rent and don't have her put up capital for the downpayment. Or have it be a bona fide gift she does not want paid back.
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Oct 15, 2020 18:09
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Agreed with previous posters about saving and 401k, and H110Hawk raises a really good point: do not buy a house with someone unless you're married, or have an equally well-defined legal contract between the two parties about how the equity is managed. There are different legal approaches but the important part is that you pick one and define it all in a legally-binding contract before closing, drafted and reviewed by a real lawyer.
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Oct 15, 2020 18:19
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Maxed out my 401k early for the first time ever. Hoping my company will come through with the True-Up.
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Oct 15, 2020 18:22
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H110Hawk posted:3. Money for a legal contract with your unmarried house buying partner. You must do this (or get married) if she is going to be having an equity interest in the house. Otherwise, just charge rent and don't have her put up capital for the downpayment. Or have it be a bona fide gift she does not want paid back. This cost me about $2000 to have a reputable law firm review and draft up the document here in Colorado. Very worth it if my partner and I split. It is super well defined. We keep a google sheet to track payments, upgrades, etc. I think our favorite part is that we technically have to put our break up in writing now. ha. E: Getting that sweet 1% on the HMBradley account, 3% here I come.
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Oct 15, 2020 19:17
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H110Hawk posted:1. Leave it. FDIC insurance is what you're buying. Consider that hmbradley account people are pimping here. 1. That HMBradley account looks good. If I just set up my direct deposit to have most of it go to my regular checking, and then part of it to an HMBradley account, that'd qualify as the monthly check and also since I wouldn't really be touching it, I'd qualify for the 3%, right? 2. Yeah, upon looking at the numbers it would probably be better to get a 20% down payment to reduce the overall payment as well as avoid PMI. It depends on my total comp and how it fluctuates / how the value of my RSUs respond. 3. Good point, we'll likely be married (or be planning for it then) but regardless I'll make sure I'm covered legally with a contract if that doesn't end up being the case for whatever reason.
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Oct 15, 2020 19:23
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seiferguy posted:1. That HMBradley account looks good. If I just set up my direct deposit to have most of it go to my regular checking, and then part of it to an HMBradley account, that'd qualify as the monthly check and also since I wouldn't really be touching it, I'd qualify for the 3%, right? That is right. I just dumped my E-Fund over there and set up a $150/pay check DD with the rest of my paycheck going to my normal checking. You start at 1% until it recalculates at the end of the quarter where it should be 3%.
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Oct 15, 2020 19:32
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seiferguy posted:2. Yeah, upon looking at the numbers it would probably be better to get a 20% down payment to reduce the overall payment as well as avoid PMI. It depends on my total comp and how it fluctuates / how the value of my RSUs respond. If you're married then you can also count your household income more readily, which should make the $1MM house more in reach, assuming your spouse has a similar bay area salary. I would not county equity towards your monthly obligation, only stuff you have cashed out into the down payment. A hedge against repairs and stuff is OK, but not great. If in the run up to actually buying the house you are engaged and making plans for a wedding I would seriously consider just signing paper at the courthouse to make it legally official, then hold a sham wedding later. You don't have to tell anyone if you don't want to, especially if you're worried your parents will freak out. It will save you a bunch of time and effort with an attorney, showing your lenders this stuff, convincing their underwriting staff, etc. Plus once you get married you will want to update the title anyways. Spend the money instead on the estate planning package you will need immediately after buying the house regardless, then toss the house, employer equity, etc, in the trust.
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Oct 15, 2020 19:41
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index chat Etsy is in the S&P 500, and thus Vanguard's VOO ETF (holding ~#325 by weight). Etsy is also in Vanguard's small-cap ETFs, such as VBK (small cap growth) and VB. A "small-cap" S&P 500 stock. The relevant CRSP index and methodology seems weird: http://www.crsp.org/files/crspscg1_quarterly_report-september2020.pdf http://www.crsp.org/files/Equity-Indexes-Methodology-Guide_0.pdf I don't have all the data they do, but if their methods don't have ETSY in at least the mid-cap fund if not split across lrg/small or mid/small, this seems wack. There are alternatives to CRSP indexing: https://advisors.vanguard.com/VGApp/iip/advisor/csa/investments/benchmark/benchmarkcomparison/ S&P seems like the best alternative, and ETSY is in their mid-cap indexes. Anyone partial to a particular index provider? Russell vs. CRSP vs. S&P vs. others?
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Oct 15, 2020 20:23
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Loan Dusty Road posted:If all your money was in cash right now, what would you buy / make your allocation be? literally this big posted:Yes, bite the bullet and got back to your pre-COVID allocation IMO. You're so far away from retirement that it won't matter if the market drops or not, from COVID, or election troubles, or whatever. You're young, so time is on your side like that. Perhaps re-consider your stock:bond ratio if you still feel unsure. Thanks, both of you. I just placed an order to move the funds out of the PIMCO bonds and back into BKTSK, to get myself back in line w/ my long-term strategy of mirroring VFIFX.
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Oct 16, 2020 03:15
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Animal posted:Maxed out my 401k early for the first time ever. Hoping my company will come through with the True-Up. Congrats. *edit* Nevermind I googled. Ok, so yeah you hope your company will continue their employer matching through the rest of the year. Hope so for your sake but if they don't, it's your error. Why not just set 401k to contribute evenly throughout the year to hit the max in December? zaurg fucked around with this message at 03:51 on Oct 16, 2020 |
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Oct 16, 2020 03:48
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Time in the market beats....
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Oct 16, 2020 04:33
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zaurg posted:Congrats. because our system only allows contribution based on %. However, my pay can vary wildly between pay periods. I had some good pay periods and hit the max. We have a contract that says they’ll make a lump sum deposit of the True-Up in the beginning of the next year.
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Oct 16, 2020 06:24
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Animal posted:because our system only allows contribution based on %. However, my pay can vary wildly between pay periods. I had some good pay periods and hit the max. Set it to 100% gently caress it. 
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Oct 16, 2020 06:27
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H110Hawk posted:Set it to 100% gently caress it. I get my match once a year in February so I basically do this. I think we can put it at 30% max in the system, I have it somewhere around 20-22%. I usually max out in July or August, then get my 4% match in February.
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Oct 16, 2020 16:13
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spwrozek posted:I get my match once a year in February so I basically do this. I think we can put it at 30% max in the system, I have it somewhere around 20-22%. I usually max out in July or August, then get my 4% match in February. I set it to 85% (our max.) Plus our espp to 21250/10 (Nov-may). Then we get our true up in June or so, which is really long but our other benefits are pretty killer. There are months where my paycheck is $0 net. I basically ride on previous espp purchases and rsu sales. I couldn't do it that crazy my first year but I caught up and did it whole hog in 2019 due to the espp.
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Oct 16, 2020 16:28
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I'm thinking about a newer car next year. I can put $3000 with maybe $200/month to start in order to set aside towards the down payment or cash purchase. If I'm OK with higher risk, is VFIAX the best option or is there a different Vanguard fund/ETF?
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Oct 16, 2020 21:01
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Don't put money in the market if you need it inside of 10 years, in all honesty. Put your $3,000 and recurring $200/month in an online savings account. That is, if this is really "money for buying a car next year". If this is "money to invest, and if it does well I will buy a car next year" then sure, why not. VTSAX over VFIAX in my opinion to get that small/midcap exposure.
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Oct 16, 2020 21:05
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H110Hawk posted:I set it to 85% (our max.) Plus our espp to 21250/10 (Nov-may). Then we get our true up in June or so, which is really long but our other benefits are pretty killer. There are months where my paycheck is $0 net. I basically ride on previous espp purchases and rsu sales. I couldn't do it that crazy my first year but I caught up and did it whole hog in 2019 due to the espp. That’s loving awesome
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Oct 17, 2020 15:47
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KYOON GRIFFEY JR posted:529 has to be used for ed vs something like an UGMA / UTMA can be used for other purposes, might be worth keeping in mind if you think there's a chance that college is not for them. I agree that with GI bill you probably don't need to focus too hard on funding 529 right now especially if you (realistically) project that income picture will change for the better significantly in the next couple years. Or you could do what my parents did and pay for a bunch of my tuition with a credit card and then fall behind on payments, ruining your credit and forcing you to do a 30-year refi on your house 15 years into owning it because "student loans are bad". Or don't do that. That's been my financial guiding light since becoming an adult and realizing how shitfuck terrible my parents are with money: "What would Mom and Dad do? Ok, do the opposite."
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Oct 17, 2020 21:05
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Can we make fun of boomers ITT? I want to make fun of boomers. Boomers are the worst.
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Oct 18, 2020 01:09
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literally this big posted:Can we make fun of boomers ITT? I want to make fun of boomers. Boomers are the worst. By all means! but FYI if that’s your jam we already have a thread for that https://forums.somethingawful.com/showthread.php?threadid=3878671
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Oct 18, 2020 01:19
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I request that we not let this thread turn into a comedy thread. There are other threads, and indeed other entire forums, dedicated to that. Let this thread stay focused on practical questions, advice, information sharing, etc.
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Oct 18, 2020 02:44
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Long term investing is pretty boring to be fair
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Oct 18, 2020 03:03
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My family has an HVAC business (60 employees) and I work there part time doing computer-related stuff. They currently don't offer any retirement benefits. Based on what I've seen on Indeed, pretty much every other company in our area is offering a 401K (or similar). I want to convince them to do a SIMPLE IRA program with Vanguard (the 3% match option). Does anyone have any experience from the employer side of these? I've looked into it and it seems pretty straightforward, but I only have experience in my own IRAs. If I can get them on board I'd love to get it set up for the start of 2021. My biggest challenge is actually selling the idea to them. I've brought it up a few times over the past few years and I always get a very apathetic response ("Oh, your cousin went to a seminar for that once..." or something). I really want them to do this since I think it would be good for the employees and if they do it on their own they'll probably get some grifty high-priced garbage plan (since they already moved their own retirement to a financial advisor, over my very strong objections  ).
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Oct 18, 2020 04:14
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Harveygod posted:My family has an HVAC business (60 employees) and I work there part time doing computer-related stuff. They currently don't offer any retirement benefits. Based on what I've seen on Indeed, pretty much every other company in our area is offering a 401K (or similar). How's the turn over for a company like that? Are there any other benefits working at your parent's place aside from getting a paycheck? I assume healthcare would be part of the package, but what is that looking like?
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Oct 18, 2020 08:09
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obi_ant posted:How's the turn over for a company like that? Are there any other benefits working at your parent's place aside from getting a paycheck? I assume healthcare would be part of the package, but what is that looking like? I think healthcare is the only benefit (there may also be an HSA, I'm not sure). There's also typical PTO/sick time. I haven't worked been around the shop area for a while, so I'm not sure about turnover. I do know a few good guys have left over the years (I may text one of them to see what their plan is like where they went). There is one lady in the office who left specifically because she wanted a retirement plan. My uncle has lamented that some guys "leave here and become superstars at other companies." I don't know how anecdotal that is, but I think that's how I want to sell it. Even if most employees don't do it, the ones who do are exactly the people you want to stick around.
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Oct 18, 2020 16:28
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pmchem posted:Anyone partial to a particular index provider? Russell vs. CRSP vs. S&P vs. others? Have you taken a look at VXF? I ended up choosing it for my domestic non-S&P500 allocation. quote:Seeks to track the performance of a benchmark index that measures the investment return of stocks from small and midsize companies.
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Oct 19, 2020 22:45
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dox posted:Have you taken a look at VXF? I ended up choosing it for my domestic non-S&P500 allocation. yeah, VXF is a S&P 500 completion index. VOO + VXF (in proper weights) = VTI Long story short, I was basically choosing between the CRSP and S&P market-cap based indexes in order to pick which growth ETFs to use in the future (iShares S&P growth funds 500 / mid / small or Vanguard CRSP large/mid/small growth). After looking into it in more detail, I was very unhappy with how S&P categorized certain stocks are growth. CRSP is much pickier about that. So I am going to use the CRSP-indexed funds. The lrg/mid/small split is a much lesser issue in comparison. There's no VXF growth fund.
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Oct 19, 2020 22:55
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Anyone ever taken money out of a Roth IRA for a nonqualified distribution? I'm looking to take out our $12,000 of 2020 contributions temporarily to help fund the down payment on a house. The intention would be to put it back after the sale of our current home. 1. I know we're allowed to take out our contributions (but not earnings!) tax and penalty-free, but Schwab seems to classify it automatically as an early withdrawal subject to tax witholding on the transfer screen and it spooked me from doing it. 2. Will I still be able to put the funds back in for the 2020 tax year? I suppose there is a 60-day window if this was a rollover. But say it was longer than 60 days? I'm kind of floored how bad USAA and now Schwab is about keeping records of our basis. I get these accounts aren't supposed to be a piggybank, but it should be way easier to see how much is contributions vs. earnings.
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Oct 22, 2020 15:57
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Chad Sexington posted:Anyone ever taken money out of a Roth IRA for a nonqualified distribution? I'm looking to take out our $12,000 of 2020 contributions temporarily to help fund the down payment on a house. The intention would be to put it back after the sale of our current home. Are you a first time homebuyer? I think you can take up to a 10k distribution of the earning from a Roth IRA penalty free for a first time home purchase.
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Oct 22, 2020 16:05
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Chad Sexington posted:Anyone ever taken money out of a Roth IRA for a nonqualified distribution? I'm looking to take out our $12,000 of 2020 contributions temporarily to help fund the down payment on a house. The intention would be to put it back after the sale of our current home. The rules might have changed but if you redeposit the same amount as the withdrawl within 60 days there should be no tax penalty. You can do this once a year only. Im guessing they consider it early withdrawal because its software and their system is just not designed well. I dont think the calendar has any impact on the 60 day window. Its essentially similar to a rollover, so you'll have to provide proof that you repaid the distribution when you do your taxes, but not sure how to do that if the repayment happens in January, but I'm sure its not incredibly difficult because this type of stuff happens every year. CS might even provide an amended 1040A. This might have changed since I had my license though.
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Oct 22, 2020 16:14
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Nitrousoxide posted:Are you a first time homebuyer? I think you can take up to a 10k distribution of the earning from a Roth IRA penalty free for a first time home purchase. Nope, trying to sell our first home and buy another. The D.C. market is insane, so to avoid having a home sale contingency that will make our offers look less attractive in a competitive market, we're trying to buy first with cash on hand. We should be able to swing 10% down, but I want to have a bigger cash buffer in case something goes wrong with the sale and we're trying to get poo poo done while paying two mortgages for a month or two.
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Oct 22, 2020 16:26
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Interesting interview with the guy who did the research and came up with the 4% rule. He says there's a lot of misconceptions and he personally uses 5% as his figure. https://www.marketwatch.com/story/the-inventor-of-the-4-rule-just-changed-it-11603380557?mod=home-page
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Oct 23, 2020 02:06
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So, I learned something today. Some mutual funds can be converted into their ETF equivalents by your broker while retaining the original cost basis (including date of buy for capital gains calculations). I just placed an order to convert a bunch of VIGAX that I bought on 3/27/2020 into VUG. It will simplify my life since my other holdings in that account are primarily ETFs. If anyone else is looking to use ETFs more, you might check out whether your mutual funds can be converted by your broker. Saves some effort on your end and prevents taxable events (if that matters for the account). The conversion happens post-close at NAV. edit: answering a question from discord -- I had to call in and talk to a human to do this conversion pmchem fucked around with this message at 16:09 on Oct 23, 2020 |
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Oct 23, 2020 16:05
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also, a question regarding taxable accounts: is there any TAX advantage (in a taxable account) to using an all-in-one fund such as the VT (all-world stock) ETF or a target date fund, versus just owning the components (in the case of VT, it would be VTI and VXUS; in the case of a target date fund, it would be a couple stock index funds and a couple of bond index funds)? For this thought experiment, assume that you would be rebalancing the ratio of component funds quarterly to match the all-in-one fund percentages. Basically; does owning an all-in-one or balanced fund let you somehow get an advantage in not paying some capital gains tax vs. owning the individual funds? How big is this difference, if any?
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Oct 26, 2020 01:59
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I have been trying to figure out the answer to this, as I understand it one of the benefits of holding international in a taxable, is that there is the foreign tax credit. But I haven't been able to work out the precise rules about whether part of your VT holdings qualify for it. If they don't then that would be an argument for going VTI + VXUS.
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Oct 26, 2020 02:13
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The opposite- there is a tax advantage to slice and dice in a taxable account. You can much more easily control your realized gains with separate funds that don't track together. You can also tax loss harvest if, say, your US tanks but your international doesn't. The foreign tax credit would be the same either way I believe.
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Oct 26, 2020 02:51
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I don't know if this is the right thread for it, but I need advice on life insurance. Some background. I'm pretty healthy, if a little unfit (normal Goon with dad bod). Non smoker, occasional drinker. No underlying health conditions that I am aware of. I'll be 39 in June, spouse is same age, and we had a baby in 2020 (what a year). I maxed out all of my tax advantaged accounts in 2020, and am set to do so again in 2021. My income is low six figures. No significant debt. I am currently life insured through my company's benefits for a total of $700k for "normal" death, and $800k for accidental death and dismemberment. I don't feel like this is enough. I wanna set up my wife and daughter so that they don't have to struggle financially for the foreseeable future, so I think I'd like to leave them at least $1,500,000 total and instruct my wife to withdraw no more than 6% of that until she is able to get back in the workforce, then 4% of that a year in perpetuity. I can get additional Whole Life through my company but it maxes out at $200k and is $80 a month, which makes that $200k more expensive than all my other life insurance combined. Not good enough. I bank with Alliant Credit Union and they seem to have both Term and Whole life insurance policies. Any guidelines and rules of thumbs I should be following? Is there such a thing as the Vanguard of the life insurance world? Animal fucked around with this message at 03:28 on Oct 26, 2020 |
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Oct 26, 2020 03:16
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Never get whole life insurance. Someone can point you towards an optimal term life insurance provider, I don't have any knowledge there, but I know as indisputable fact that whole life is a pure scam.
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Oct 26, 2020 03:45
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