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acidx posted:hello vanguard, i would like one vtsax minus gamestop asap, tia AMC is the new meme stonk anyways.
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Jan 27, 2021 17:12
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I’ve got my Roth IRA and rollover IRA on Vanguard 2055. I hear talk about target date funds being suboptimal for taxed accounts. Should I not be using the fund for my IRAs? Also, I’m watching the GameStop hilarity and [laughs in long-term investment]
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Jan 27, 2021 19:09
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Target-date funds are ideal for IRAs since you don't have to pay taxes on anything that happens in an IRA. They usually aren't recommended for taxable accounts because they can have more taxable stuff happening internally.
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Jan 27, 2021 19:30
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The Vikings posted:She's trying to find success in the arts right now, she has a graduate degree already so does not plan to get any additional education. She lives/works in Manhattan, so buying a house/apartment is probably not realistic even with this money. Sounds like both of you have a good head on your shoulders. She can start paying in for her retirement, start easy - $12k into her Roth IRA for 2020 and 2021. Buy a target date retirement index fund. Next up, think about it for 3 months. Leave it in an FDIC insured bank account. If she wants to use it to augment her long term income for day to day living then something like a total market fund in a taxable account where she draws down some % of it a year into her budget.
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Jan 27, 2021 22:27
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Refinance to 30yr 2.75% fixed is complete. Thanks for the advice, thread. Now with the monthly savings from the refi, put it into long term savings or meme stonk of the week?
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Jan 27, 2021 23:54
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congrats! and get ready for your loan to get passed around every 3 weeks so you have to continually update your banking payees!
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Jan 28, 2021 00:00
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Today I learned about roll-ins, which is when a 401k plan lets you roll an IRA into it. Normally this is weird to do, but I think I'm going to use it for one particular useful purpose: I have a past 401k with both pre-tax and Roth components. I can roll it out into IRAs (one traditional, one Roth) and then roll the tIRA into my current 401k. This way I get the greater IRA control of the Roth portion without running afoul of the pro-rata rule when backdoor Rothing in the future. Do I have this right? Are there gotchas I'm not anticipating?
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Jan 28, 2021 00:39
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raminasi posted:Today I learned about roll-ins, which is when a 401k plan lets you roll an IRA into it. Normally this is weird to do, but I think I'm going to use it for one particular useful purpose: I have a past 401k with both pre-tax and Roth components. I can roll it out into IRAs (one traditional, one Roth) and then roll the tIRA into my current 401k. This way I get the greater IRA control of the Roth portion without running afoul of the pro-rata rule when backdoor Rothing in the future. Do I have this right? Are there gotchas I'm not anticipating? I have no answers/advice for you, but curious what your decision is. My current 401k has some pre-tax and Roth components. I started off doing the Roth 401k and switched it up. I've just left it as-is. So I guess when I leave this employer I'll be in a similar situation, by that I mean simply referring to having "a past 401k with both pre-tax and Roth components" and wondering what options I'll have. I doubt I'll ever have to consider backdoor Rothing.
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Jan 28, 2021 05:47
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This article seems to indicate that all the index fund/entire market funds/etc. are indeed mostly safe from meme stonking unless Financial /b/ can stonks all of capitalism at once for the lulz: https://www.reuters.com/article/us-retail-trading-funds-idUSKBN29X0LZ Goddamn, so much of this ties back to a goon in the first place. Long, strange trip.
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Jan 28, 2021 14:30
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MJP posted:Goddamn, so much of this ties back to a goon in the first place. Long, strange trip. Which goon?
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Jan 28, 2021 14:32
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i will lol if GME makes it in to the S&P 500
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Jan 28, 2021 14:38
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This is why I don’t gently caress with individual stocks. This GME poo poo is rear end in a top hat Nerd Hot Potato.
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Jan 28, 2021 15:14
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KYOON GRIFFEY JR posted:i will lol if GME makes it in to the S&P 500 If that happened, would some index funds perform a reallocation and automatically buy them? Because LMAO.
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Jan 28, 2021 16:13
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KillHour posted:If that happened, would some index funds perform a reallocation and automatically buy them? Because LMAO. Absolutely; that's how index funds work. They can't be bargained with. They can't be reasoned with. They don't feel pity, or remorse, or fear. And they absolutely will not stop, ever, until their assets match the underlying index within acceptable tolerance. (Standard and Poor's isn't going to put GME in the index, though)
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Jan 28, 2021 16:18
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Space Gopher posted:Absolutely; that's how index funds work. I'm already overexposed to TSLA. Don't do this to me, S&P!
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Jan 28, 2021 16:20
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Gamestop is probably in the top 10 stonks of my smallcap fund right now. Hope this valuation blows up before buying time next week, would feel bad buying even 1 usd of poop.
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Jan 28, 2021 16:23
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KillHour posted:If that happened, would some index funds perform a reallocation and automatically buy them? Because LMAO. Yes. I don't think Standard and Poors has too much of a choice if GME continues at a high share price, it's a cap-weighted index and GME is already bigger by cap than a bunch of the existing S&P 500 list. However, I think it's really unlikely that GME maintains a high share price for long enough to make this a real consideration.
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Jan 28, 2021 16:30
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KYOON GRIFFEY JR posted:Yes. It's a cap-weighted index, but there's a degree of active management of the index involved, too. "This company's market cap is stratospheric but it's clearly only due to market fuckery" wouldn't get them on the list. https://www.fool.com/investing/2019/02/09/how-are-sp-500-stocks-chosen.aspx quote:Meeting all the basic requirements isn't enough; companies must get the approval of the index committee to get into the S&P 500, making it more of an "active" index than other indexes that simply use mechanical rules to pick stocks. For example, the Russell 1000 doesn't have a committee. Either a company meets the mechanical rules or it doesn't.
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Jan 28, 2021 16:34
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Ah, I didn't realize they had such a degree of discretion.
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Jan 28, 2021 16:47
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Space Gopher posted:the committee feared that removing AIG might have negatively affected the company Ah, so that's the invisible hand of the market that I've heard so much about.
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Jan 28, 2021 16:48
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KYOON GRIFFEY JR posted:Ah, I didn't realize they had such a degree of discretion. it is part of the reason it took so long for Tesla to get in there.
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Jan 28, 2021 16:48
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spwrozek posted:it is part of the reason it took so long for Tesla to get in there. And if it was an auto-triggered thing the indices would be horribly tax inefficient as the bottom of the index churned on a regular basis.
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Jan 28, 2021 16:52
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KYOON GRIFFEY JR posted:Ah, I didn't realize they had such a degree of discretion. What's weird is that it's such a widely-cited benchmark. Also gives new meaning to "passive index fund" when your index is a list of stocks chosen by committee.
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Jan 28, 2021 17:42
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pokeyman posted:What's weird is that it's such a widely-cited benchmark. Also gives new meaning to "passive index fund" when your index is a list of stocks chosen by committee. They have never claimed to be completely passive. There has always been a bit of stress test / gut feeling to make sure it's not a flash in the pan sorta rise. They've generally been decent about it with that one index.
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Jan 28, 2021 18:00
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[IQ 10,00 Genius Troll] Ah the fund is managed by people, and you buy it on January 2nd every year? So much for passive investing and not market timing 
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Jan 28, 2021 18:02
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Space Gopher posted:It's a cap-weighted index, but there's a degree of active management of the index involved, too. "This company's market cap is stratospheric but it's clearly only due to market fuckery" wouldn't get them on the list. But Tesla?
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Jan 28, 2021 18:52
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Apologies if this is long, I am trying to get my head around a couple of things at once. Wife and I are DINK, both academic jobs so that means we were in grad school forever with no earnings, savings but also no debt. So now we both have real jobs that pay quite well. IMO our biggest flaw is that we were unable to save for retirement for a long time (39 and 41 y/o). Our employer's plan is through TIAA-CREF and we are both vested with 5% of our income into the plan and a 9% match by the employer. We just refinanced a 30 yr mortgage on the home into a fixed 20yr and are easily paying down at about a 15-17 yr rate. We've also just hit savings goals of several months of emergency funds etc and no other outstanding debt besides the mortgage. So, now we are saving extra money (finally) and am looking at best ways to approach things. I would like to contribute more towards retirement, but also don't want all of that to be tied up in quite long term holdings as we have some family members who we may need to help out financially due to their types of employment. We are both willing to prioritize that over our retirement if need be. So what is unclear to me is whether or not I should just take a portion of excess income and shunt it into the retirement fund I'm already putting 5% into or put it elsewhere. We are married, file jointly and joint income is ~190k USD/yr before taxes. Is there any concerns there in regards to Roth IRA contributions? Should I just dump some into the plan I already have and the rest into a Vanguard mutual for a few years etc? Sorry if this is vague, just trying to get the lay of the land to figure out where to spend more time reading up on it. We have access to financial advisors at work through TIAA-CREF, but I assume they will just try to get us to push more money towards them and not sure if that is actually ideal.
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Jan 28, 2021 18:53
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You're fine in terms of being able to contribute to a Roth IRA until you make $206k/year MAGI as MFJ. Before you start getting in to how to do it, you have to decide what you want to do. I think one thing you want to do is figure out how much money you are going to need in retirement and make sure you are going to hit that number. If you plan to support family members, you should figure out what that is likely to cost you and plan accordingly. "we are going to support Person X" is not really a requirement you can plan around.
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Jan 28, 2021 19:06
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KYOON GRIFFEY JR posted:You're fine in terms of being able to contribute to a Roth IRA until you make $206k/year MAGI as MFJ. Thanks. I should have been more clear, on the Roth IRA this coming year we might be over 206k, or at least very close as some of this is bonus contingent but let's assume that we end up at like 210k, what happens if we contributed to a Roth IRA In that same year? Separately, yeah agreed on the "what". For the purposes of other family member I think that would just be "have an expanded emergency fund" because it's unlikely to ever be a situation where they become our de facto dependent indefinitely. It's more that they work in an industry prone to downturn (arts). That's partly why I was thinking of wanting to have some investment in shorter term bins vs just fixed to my own retirement age. For our own retirement, assuming we stay in our current home or retire in one paid off, we're already "on track" (according to TIAA estimates) for our target monthly income at our retirement age (we are going to revisit / refine this as well but am comfortable that we're not in a terrible position at present). I'm interested in expanding that a bit alongside trying to grow some excess income in a shorter term more liquid fashion I guess.
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Jan 28, 2021 19:24
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In that case I'd just stick some money in HYSA or similar relatively low risk stuff for family member, as any downturn in their income is likely to coincide with a downturn in the broader economy. The IRA thing just came up - you can contribute to trad IRA and backdoor without issue. What type of retirement benefit do you have through your employer?
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Jan 28, 2021 19:31
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H110Hawk posted:They have never claimed to be completely passive. There has always been a bit of stress test / gut feeling to make sure it's not a flash in the pan sorta rise. They've generally been decent about it with that one index. I don't think S&P is the problem, more that people choose dumb benchmarks. GoGoGadgetChris posted:[IQ 10,00 Genius Troll] Ah the fund is managed by people, and you buy it on January 2nd every year? So much for passive investing and not market timing I mean, you can clearly be much more active in your investing than buying a fund targeting the S&P 500. But for me at least, it was easy to start equating "passive" with "good", and there's lots of ways "passive" funds can incorporate active decisions. Surprisingly, it turns out reducing several axes of decision-making to one of two words loses some nuance! But yeah, not trying to make the argument that some broad mechanically-balanced index fund is the same as picking 5 stocks.
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Jan 28, 2021 19:31
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KYOON GRIFFEY JR posted:In that case I'd just stick some money in HYSA or similar relatively low risk stuff for family member, as any downturn in their income is likely to coincide with a downturn in the broader economy. Thanks this is very helpful. It's a 403b
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Jan 28, 2021 19:40
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pokeyman posted:I don't think S&P is the problem, more that people choose dumb benchmarks. I agree with you. I think if S&P 500 tried to update the list with daily or even monthly market swings it would be nuts. I'm curious how this is impacting the "Total Market" (VTSAX) sorta funds.
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Jan 28, 2021 19:40
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COINCEL PRO posted:Thanks this is very helpful. So assuming no increases and constant 14% savings rate in 403(b) compounding at 5% over 25 years, you all should be sitting on about 1.5 million at age 65. Up to you if you think that's enough. Personally, I think it's just a little bit light but I'm pretty risk averse in the long run. Add in another 12k a year at the same rate and you'll be around or over 2 mil. Contributing more money to the 403(b) will reduce your tax obligations, so that might be useful to you, but investing in a Roth IRA will help you hedge against future tax policies. You're in a good spot due to no debt and with a lot of flexibility due to income. There aren't many downsides to the decisions you have in front of you, but you should definitely consider your goals and priorities for life, not just retirement!
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Jan 28, 2021 20:06
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I have about 300k in various IRA, 401k, and post-taxed accounts, and apparently without further contributions it will grow to like 300% of its initial state assuming 3% yoy until 2055. I’m considering lightening up on the non-401k/IRA contributions so I can get a nicer apartments. 401k and IRA contribs have to continue tho, cause that’s apparently a pretty light amount of money without the additional contributions.
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Jan 28, 2021 20:31
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CompeAnansi posted:Which goon? moot, my dude No moot making 4chan based on ADTRW stuff -> no /b/ -> no hivemindified internet consciousness to the same degree -> no memes -> no anonymous internet hiveminding -> no stonks I mean, yeah, this is drastically over-simplified and more of a "know your history" thing than personal finance, but it's still quite a trip. MJP posted:I have access to a GUL cash accumulation fund thanks to life insurance provided by my employer. I've been treating it as just a fun money fund - sock away like $40 per paycheck. It accumulates at 4%. Should I treat this thing as just another savings account, a la one with higher interest and taxable withdrawals? Throwing it out for another shot. Am I just kinda putting stuff into a savings account with a GUL cash accumulation fund?
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Jan 28, 2021 21:07
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Pollyanna posted:I have about 300k in various IRA, 401k, and post-taxed accounts, and apparently without further contributions it will grow to like 300% of its initial state assuming 3% yoy until 2055. I’m considering lightening up on the non-401k/IRA contributions so I can get a nicer apartments. 401k and IRA contribs have to continue tho, cause that’s apparently a pretty light amount of money without the additional contributions. Very nice. How long has this taken you, and has it been at a fairly consistent annual investment amount?
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Jan 28, 2021 22:06
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H110Hawk posted:I agree with you. I think if S&P 500 tried to update the list with daily or even monthly market swings it would be nuts. I'm curious how this is impacting the "Total Market" (VTSAX) sorta funds. For reference, at 12/31/2020 gamestop was 0.0026% of VTSAX's holdings. At the peak price as of this writing, the GME bubble would have increased the value of the fund by 0.06%. I dont see a reason why VTSAX would have to change their holdings as a result of this activity, it's one of the beautiful consequences of cap-weighted indices that changes in underlying prices don't require the funds to do anything at all.
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Jan 28, 2021 22:10
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I finally set up a Roth IRA thru vanguard last year. I don’t know what the gently caress I am doing- all I’ve done so far is choose 2055 target retirement mutual fund, and max out my contributions last and this year. Before I find time to actually educate myself on the Roth IRA, anyone think I’m missing anything? Also, Vanguard app question, what does this 0% mean? 
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Jan 28, 2021 22:49
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| # ? Jun 6, 2024 00:42 |
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It looks like you haven't actually invested your cash in your target date fund if your performance is 0% since October 2020 What are your positions in the account, if you look at your holdings?
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Jan 28, 2021 22:59
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