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Useful info on TIPS vs I-Bonds here: https://www.treasurydirect.gov/indiv/products/prod_tipsvsibonds.htm
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Jul 30, 2021 21:35
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KYOON GRIFFEY JR posted:Useful info on TIPS vs I-Bonds here: So basically I-Bonds are fully tax deferred and TIPS are more like regular bonds where you'll pay regular taxes on the interest payments?
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Jul 30, 2021 22:24
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I've been meaning to make a TreasuryDirect account to start buying I-Bonds, so I tried to just now. They were unable to verify my info and need me to print and mail in a form. Probably not gonna put in the effort... I vaguely remember this happening several years ago on their old site. Bet I gave up for the same reason back then.
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Jul 30, 2021 22:32
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Treasury Direct has the worst website I've ever used
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Jul 30, 2021 23:17
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Ur Getting Fatter posted:So basically I-Bonds are fully tax deferred and TIPS are more like regular bonds where you'll pay regular taxes on the interest payments? Yea, and TIPS also get you on the inflation adjustment to principal, which you owe taxes on every year in addition to the yield. But at least they are state tax exempt, so they are slightly better than regular bonds.
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Jul 30, 2021 23:17
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I just made an account and also have to mail in a form. So maybe VIPSX is the right move.
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Jul 30, 2021 23:17
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Are I-Bond really inflation tracking instruments if they update the yield semiannually?
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Jul 30, 2021 23:43
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I mean that's the best you're gonna get.
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Jul 31, 2021 00:12
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If you are just comparing paying a mortgage vs investing the market for 30 years, do you use the inflation adjusted 7% return or nominal 10% since the mortgage rate is fixed?
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Jul 31, 2021 11:18
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FateFree posted:If you are just comparing paying a mortgage vs investing the market for 30 years, do you use the inflation adjusted 7% return or nominal 10% since the mortgage rate is fixed? Short answer: I use a super-conservative rate like 5-6% because I like to bullet-proof my planning scenarios as best I can, regardless of actual returns, inflation, etc. for all of my decisions. Therefore, I'm investing as much as I can and will look to pay off my mortgage around the time I stop working full time with whatever proceeds happen to be at that time. I already have a 15 year mortgage so there is no rush for me. There's more than one way to look at this, as you've hinted at. If you're looking at the factors that influence your return on the investment side, then you probably should look at the factors that influence the debt side: length of loan (leverage risk), and possible tax deduction (which may be meaningless if you use the standard deduction). I'll admit that I'm not consistent in how I view this question. Since this is specifically about a fixed rate 30-year debt that has no meaningful "call" clause, then it is really more like being on the opposite side of a 30 year bond. Those 30-year treausury bond rates are super-low right now. So, paying off a mortgage is a decent return at a fixed rate. The downside is that the money is illiquid until you sell the house (and who knows when that'll be if you're planning on living there for a long time), and there is no cash flow benefit until the whole mortgage is paid off. If the comparison is to stocks, then the question becomes, why not leverage more? Mathematically it's the "smart thing to do" because of the interest rate arbitrage...until a down year. The minute that returns go negative, many people get a visceral feeling that this strategy is not as smooth as they'd like it to be. As long as you don't sell your portfolio and ride it out, then everything is likely to be fine. Unfortunantely, I do know a few "refi until I die" tpyes that were looking to change their lifestyle in 2008, and when everything crashed, they had to delay their plans for another decade!
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Jul 31, 2021 14:17
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I heard HMBradly is now invite-only for their 3% account. Any goon wanna send one my way?
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Aug 1, 2021 00:17
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PM'd you
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Aug 1, 2021 00:42
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FateFree posted:If you are just comparing paying a mortgage vs investing the market for 30 years, do you use the inflation adjusted 7% return or nominal 10% since the mortgage rate is fixed? You should be using the nominal rate because all the other factors are nominal. The mortgage costs are going to be in nominal dollars, the house appreciation is going to use a nominal rate as will the rent increase.
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Aug 1, 2021 02:59
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What's the right amount of umbrella liability insurance to have, as a factor relative to net worth? I'm fortunate to have a NW that increasingly exceeds my umbrella policy coverage. Should I think about upping it? I obviously don't trust an insurance agent to give me a reasonable answer. But some cursory boglehead and FI advice seems to suggest keeping the umbrella policy in line with your NW, at least up to the $3-5m range. I don't know if that sounds reasonable or not? Guinness fucked around with this message at 21:47 on Aug 2, 2021 |
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Aug 2, 2021 21:40
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Decent discussion here: https://www.bogleheads.org/forum/viewtopic.php?t=191913 Net worth is not the only factor to consider, but even having $1M in coverage will cover the vast majority of lawsuits.
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Aug 2, 2021 22:17
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moana posted:Decent discussion here: https://www.bogleheads.org/forum/viewtopic.php?t=191913 $1M should be plenty. It's overwhelmingly unlikely anyone would every get into an umbrella to begin with (which is why they are so cheap), so progressively higher amounts past $1M are VERY cheap. It was very much worth the peace of mind for me to get $2M. From memory it was maybe 30% more than the $1M policy.
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Aug 2, 2021 22:43
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Motronic posted:$1M should be plenty. It's overwhelmingly unlikely anyone would every get into an umbrella to begin with (which is why they are so cheap), so progressively higher amounts past $1M are VERY cheap. It was very much worth the peace of mind for me to get $2M. From memory it was maybe 30% more than the $1M policy. God drat it, I just priced out an umbrella through state farm a week or two ago and the agent told me 2M was 2x the quote for 1M.
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Aug 2, 2021 22:45
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If most of your net worth are in retirement accounts that are protected from creditors, would you need umbrella insurance?
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Aug 2, 2021 22:46
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Depends, lawsuits can go after future earnings as well as assets. It is a couple hundred dollars for a 1M policy, well worth the peace of mind imo.
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Aug 2, 2021 23:11
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moana posted:Depends, lawsuits can go after future earnings as well as assets. It is a couple hundred dollars for a 1M policy, well worth the peace of mind imo. Agreed. Mine is ~$300/year on top of my car and house insurance.
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Aug 2, 2021 23:15
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Adopting the mortgage adage...If I'm being sued for $1,000 then I have a problem. If I'm being sued for $1M then my insurance company has a problem.
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Aug 2, 2021 23:37
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Residency Evil posted:God drat it, I just priced out an umbrella through state farm a week or two ago and the agent told me 2M was 2x the quote for 1M.  I don't know when the breaks start, but with State Farm it's definitely above $2MM. Even their $1MM is getting spendy @ $339/yr. One of these days I will probably deal with the hassle of moving my policies out of there, but for now they get their several grand a year.
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Aug 3, 2021 00:30
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Yeah, I've always heard that Umbrella policies are more "go away or my insurance company's lawyer will spend $1M of their money and $1M of your money until we break even if you want to get to my assets" to keep frivolous lawsuits away. I need to get off my rear end and get one.
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Aug 3, 2021 01:04
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OGDanDogg posted:Yeah, I've always heard that Umbrella policies are more "go away or my insurance company's lawyer will spend $1M of their money and $1M of your money until we break even if you want to get to my assets" to keep frivolous lawsuits away. For the legitimate claims they can also be a very attractive settlement offer. $1MM right here, right now, or we do it the hard way. The opposing counsel is probably paid 33% of that and says "Yes you should definitely take that settlement." (It obviously isn't this simple, and attorney's have actual duty to you, personally, to make sure you get sound advice. It's a strong motivating factor if the pockets are otherwise not deep beyond that policy or a jury might not award you that much, etc.)
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Aug 3, 2021 01:14
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What events are these for? Somebody trips on a crack in your driveway? You rear-end someone and they claim whiplash? I always wrote them off as the kind of predatory solicitations that come with publicly viewable wealth ("let us manage your assets for 1% Let's protect you from frivolous lawsuits! Let's get you invested in European Utility Companies!!!"), but are they actually important??
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Aug 3, 2021 01:37
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You back into a supercar, someone bites themself then opens your gate and smears blood on your dog, the list goes on. It's mostly just the paranoia of "I might be worth suing now."
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Aug 3, 2021 01:45
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.....yeah, it's just great piece of mind at a low cost and I am very happy to pay Travelers $130 year for a $1M policy - in case some asshat impales themselves on one of my front yard agave plants.
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Aug 3, 2021 01:56
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GoGoGadgetChris posted:What events are these for? Somebody trips on a crack in your driveway? You rear-end someone and they claim whiplash? Go take a look at your auto policy limits. Now go get a quote on a 1M umbrella and see what auto policy limits are required to get it. Then get a quote on those auto policy limits and do the math. You may have auto policy limits that are too low. You may have them higher and are paying more than what it would cost to lower them and get an umbrella policy. Now think about multi car accidents with either or both very expensive vehicles and medical costs. Sure, it covers other things. But auto is probably the most common place anyone would be likely to exceed policy limits. Homeowner liability in freak situations I guess has happened, but it's got to be way less common. In the end, this is a policy that effectively puts the burden of the bulk of legal costs on your insurers. As it should have been in the first place. You're putting more of their skin in the game on the cheap.
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Aug 3, 2021 01:59
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GoGoGadgetChris posted:What events are these for? Somebody trips on a crack in your driveway? You rear-end someone and they claim whiplash? It seems to be pretty commonly recommended on financial sites that also tend to recommend low cost index funds and against buying whole life insurance. It also seems like a pretty great way to stop my mind from running wild with hypothetical scenarios the next time I get a call from my wife after rear ending someone in a rental car in Columbus, Ohio.
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Aug 3, 2021 02:01
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Dang, solid points. I think I have a learned aversion to anything that's pitched as "if you have money, you need this" but this sounds like a good benefit. $130 later and State Farm has $4M in coverage for me I'm having an open house week after next so this is probably a very good idea...
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Aug 3, 2021 02:28
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Thanks for the info ya'll. I may give my insurance company (SF) a call and see what the cost would be to bump up to a $2m policy and make a judgement call from there. It's drat unlikely to ever need it but it's cheap peace of mind. My $1m is $190/yr through SF, on top of my home and autos. drat $4m for $130 is a steal. Guinness fucked around with this message at 02:46 on Aug 3, 2021 |
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Aug 3, 2021 02:42
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moana posted:Depends, lawsuits can go after future earnings as well as assets. It is a couple hundred dollars for a 1M policy, well worth the peace of mind imo. I’ve never thought about umbrella insurance at all. Is there something it doesn’t cover ? Does it cover medical (probably not)? And is that like, $130 a year ?
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Aug 3, 2021 02:58
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GoGoGadgetChris posted:Dang, solid points. I think I have a learned aversion to anything that's pitched as "if you have money, you need this" but this sounds like a good benefit. $130 later and State Farm has $4M in coverage for me Guinness posted:My $1m is $190/yr through SF, on top of my home and autos. drat $4m for $130 is a steal. Dang, wtf. How are yours so cheap and mine is $330. (Albeit less "net" from lowering my car liability coverage to umbrella minimums, but still.) 
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Aug 3, 2021 03:25
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H110Hawk posted:Dang, wtf. How are yours so cheap and mine is $330. (Albeit less "net" from lowering my car liability coverage to umbrella minimums, but still.) It reflects every discount under the sun, including physical precious metals. On an annual basis I'm definitely on the receiving end of the steal!
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Aug 3, 2021 03:31
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Do the major companies seriously not have online quote forms for this? I'm curious, but not curious enough to bother chatting with an actual person and that's the only option offered for my ZIP code. Edit: lol, USAA does, except their form requires the addition of a vehicle. And my ebike doesn't count as a vehicle 
Cugel the Clever fucked around with this message at 04:00 on Aug 3, 2021 |
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Aug 3, 2021 03:48
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I don't have a car (or car insurance) anymore, but have called insurance companies in the past to ask about getting an umbrella policy for car rentals (along with anything else I could get sued for). They all said no. I could probably get one if I kept a non-owner car insurance policy all the time, but that adds up to a whole lot of money every year for like a couple weeks of rentals.
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Aug 3, 2021 05:24
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Your net worth isn't particularly relevant here. If you have $1M in liquid assets (outside of 401k and primary home), sure, you can't reasonably be sued for much more than $1M without the plaintiff going after future earnings or squeezing blood from a stone. But that doesn't translate to needing $1M of umbrella limit: once you have that limit, they are now able to wring $2M out of you. Like the other poster said, it's more about having enough coverage to withstand the biggest lawsuit you're likely to face.
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Aug 3, 2021 05:33
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Duckman2008 posted:I’ve never thought about umbrella insurance at all. Is there something it doesn’t cover ? Does it cover medical (probably not)? And yes, a couple hundred a year. It's super rare and you probably won't use it, is why it's so cheap.
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Aug 3, 2021 05:48
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Just because it hasn't been mentioned yet as a benefit, the umbrella policies are good to get if you have teenage drivers in the house. And echoing others, from what I've seen it's commonly regarded as pretty good value for peace of mind especially of you're a high earner.
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Aug 3, 2021 13:43
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moana posted:It's strict liability on top of whatever other insurance you have. So if you hit someone and your auto only goes to $500k medical, then the 1M policy would stack on top if they sued you for more than 500k. It won't pay for your own medical if that's what you're asking, just if other ppl sue you. Makes sense, so covers most legal stuff, but not medical bills. So, would this be a reason to get say, a lower car insurance bill and just have umbrella cover the difference ?
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Aug 3, 2021 13:52
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