Good luck! I took it right before Covid hit as I was looking to switch jobs but Covid has put that on hold for now. Hopefully late this year or next year.I’m studying for the SIE exam, gateway to becoming a financial advisor. I may leave teaching altogether and jump in feet first, or do part-time financial stuff while keeping my day job. Happy to accept advice from the wise folks here.
I don't think there's a way to do this. The good news: No state or local taxes.I have some EE bonds that will be reaching final maturity (no more interest) each month this year. They are $100 bonds (bought them for 50) and I am wondering what to do once they mature?
Can they be somehow rolled into something that I do not have to pay tax on them? I worried about cashing them in and then owing some taxes on them?
Any advice?
Sounds incredibly illiquid. Not as much as collectibles or land but won't appreciate like those could. Hard pass for me.Any of you guys on EE Bonds?
I think they're potentially useful.
If you leave your money in the bonds for 20 years, the treasury guarantees the bond value to double at year 20. Up until that point, you get 0.1% on it. Which sucks. But if you are in a situation to leave it parked for the full 20 years, then it works out to about 3.5x%. Which is better than a lot of bond funds today.
Yeah, the more I’ve researched it, the less I love it.Sounds incredibly illiquid. Not as much as collectibles or land but won't appreciate like those could. Hard pass for me.
I'd probably move it into the 401K. Though if it's possible--it would be good to figure out what options are available in their 401K.My wife’s previous company got bought out and her 403b got moved into a fixed asset IRA as the default. Our options seem to be....
1. Take a check. No.
2. Move it into the 401k of her new job
3. Open some other kind of IRA account and dump it in there so we can actually invest it.
4. Leave it as is. Probably dumb
If it matters, 35 yo and it’s about 100k in the account in question.
Any thoughts?
It really depends on the funds in the 401k and whether you want to manage 3 retirement accounts.My wife’s previous company got bought out and her 403b got moved into a fixed asset IRA as the default. Our options seem to be....
1. Take a check. No.
2. Move it into the 401k of her new job
3. Open some other kind of IRA account and dump it in there so we can actually invest it.
4. Leave it as is. Probably dumb
If it matters, 35 yo and it’s about 100k in the account in question.
Any thoughts?
My wife’s previous company got bought out and her 403b got moved into a fixed asset IRA as the default. Our options seem to be....
1. Take a check. No.
2. Move it into the 401k of her new job
3. Open some other kind of IRA account and dump it in there so we can actually invest it.
4. Leave it as is. Probably dumb
If it matters, 35 yo and it’s about 100k in the account in question.
Any thoughts?
First, consider the funds in the 401k, including the fees. If there's a low cost broad market fund available, that's probably a good option.I'd probably move it into the 401K. Though if it's possible--it would be good to figure out what options are available in their 401K.
My job uses Schwab, which I can tell you things I don't like about--but I'm overall very happy with it. Tons of options.
Wife's job uses Prudential: There are like 4 index fund options to invest in and a bunch of target date set ups you can choose from. I hate it.
The fees should be readily available in the plan literature. Look for "expense ratio". Good low cost funds have E.R. well under 0.1%, and ones that track an index can get under 0.05%.Thanks for the responses. I don’t have a good handle on the fees, but the funds to choose from look fine to use the 401k. They have about 20 funds similar to what I’m used to from mine and the exact target date options you described.
CD is good. High yield savings account is also good. As long as they are FDIC insured you're good.I need to park 200k somewhere safe for a year or until the housing market cools off. It’s currently sitting in my checking account and giving me anxiety. CD a good option?
Buy another property?Sooooo I have sold a rental house. Prices are really, really good now and somebody bit on the price tag we put on it. So now I'm playing the game of "hide the cheese" from the IRS. Legally. I've thought about maxing retirement accounts, HSA, charity, tax loss harvesting in the stock accounts. What else am I missing?
Anything but that. The idea is to simplify life at this point.Buy another property?
I'll pm you my PayPal.I need to park 200k somewhere safe for a year or until the housing market cools off. It’s currently sitting in my checking account and giving me anxiety. CD a good option?
Help my understanding. Just to clarify, you've sold the property and we're trying to minimize taxes on the gains?Sooooo I have sold a rental house. Prices are really, really good now and somebody bit on the price tag we put on it. So now I'm playing the game of "hide the cheese" from the IRS. Legally. I've thought about maxing retirement accounts, HSA, charity, tax loss harvesting in the stock accounts. What else am I missing?
Yes, minimizing taxes on a LTCG of reasonable size.Help my understanding. Just to clarify, you've sold the property and we're trying to minimize taxes on the gains?
I'm not sure how retirement accounts/HSA prevent taxes on your capital gains here. I'm sure there's some mechanism in which they get notified, alerted to the existence of the transaction. But I'm sure there's something I'm missing or don't know about. Feel free to clarify for me.
My gut reaction is to say tax loss harvest.
Don't forget--you can deduct the cost of repairs/fix-ups and any costs involved in selling it.
The ideas Sand mentioned lower his total taxable income for the year. Using the proceeds of a LT capital gain transaction to reduce ordinary income should result in a larger tax savings than reducing the gain itself. Of course that is assuming he wasn't already maxing those accounts.Help my understanding. Just to clarify, you've sold the property and we're trying to minimize taxes on the gains?
I'm not sure how retirement accounts/HSA prevent taxes on your capital gains here. I'm sure there's some mechanism in which they get notified, alerted to the existence of the transaction. But I'm sure there's something I'm missing or don't know about. Feel free to clarify for me.
My gut reaction is to say tax loss harvest.
Don't forget--you can deduct the cost of repairs/fix-ups and any costs involved in selling it.
I gotcha.Yes, minimizing taxes on a LTCG of reasonable size.
Unless I misunderstand the tax laws my income + LTCG pushes me into the 20% range (+ the 3.8% NIIT addon, as well). I think.
Not sure how it will turn out. I have managed to carry tax losses from tax loss harvesting since 2008, and added a ton of paper losses in 2020. This will help a lot and I will be adding to those as I can this year.
HSA - maxed out. 401k - maxed out. tIRA - can't do that one, sadly.I gotcha.
You CAN put the money in a traditional IRA and deduct it--but I think you're typically better off going the Roth route.
If you're in a situation to do HSA, I'm very pro HSA. I always favor maxing these.
I didn't even think about charity.HSA - maxed out. 401k - maxed out. tIRA - can't do that one, sadly.
Tax loss harvested the crap out of my gambooling account this morning, so that will help. We'll see how those issues do in the next 31 days.
Doing charity stuff in a big way this year. Gonna gather up old clothes, itemize those, and donate.
After that I think I'm just writing a check...
You are way overthinking the taxes. Let’s say you had 100 shares. You bought them at $10 and sold 50 shares at $20 and kept 50 shares. You aren’t really free rolling. You made $500 in gains on those 50 shares that you bought for $500 and sold for $1000. You still have another $500 in unrealized gains in the 50 shares you kept. When you sell the second 50, you’ll figure out the gains based on that sales price.io got crushed on taxes last year.
Have a small bu=iz and wrote off tons of things but thegamblingstocks got me big time.
MY question is...
If I buy $1000 in stock and it doubles....
And then I sell $1000 of it and free roll the rest. Is my taxable $0? until I sell the freeroll of course
I guess in my personal circumstance, Id like to... Purchase a stock, only sell what I put in, and let the rest ride, therefore having no taxes. I just want to make sure Im thinking correctly.You are way overthinking the taxes. Let’s say you had 100 shares. You bought them at $10 and sold 50 shares at $20 and kept 50 shares. You aren’t really free rolling. You made $500 in gains on those 50 shares that you bought for $500 and sold for $1000. You still have another $500 in unrealized gains in the 50 shares you kept. When you sell the second 50, you’ll figure out the gains based on that sales price.
There is no gain on any shares that you haven’t sold. It’s all based on the shares you did sell and the gains are the sales price minus the buy price and then multiplied by the number of shares.
You aren’t thinking correctly. Each set of shares you sell has a cost when you bought them and has a sales price. That’s how you get the gain. The length of time you hold the shares dictates the type of gain, long or short.I guess in my personal circumstance, Id like to... Purchase a stock, only sell what I put in, and let the rest ride, therefore having no taxes. I just want to make sure Im thinking correctly.
This is my betting part of my retirement, I have everything else taken care of.
Am I thinking incorrectly?
TY for the advice
Gotcha. So, If I sell 50 for 100% gain, I owe on the gain on the 50. Makes sense.You aren’t thinking correctly. Each set of shares you sell has a cost when you bought them and has a sales price. That’s how you get the gain. The length of time you hold the shares dictates the type of gain, long or short.
There is no concept of free rolling in taxes. Those shares just have a cost but no sales price. You are confusing selling half when it doubles with taxes. Free rolling means that if the second half goes to $0, you didn’t lose money and this you pay no taxes. Your second half still has value so you need to pay taxes on the first half you sold and then figure out taxes on the second half when you cell that.
Think about it, how would ever know how much the gain is on the shares you kept until you sell?
And, if you're at day 363, do go ahead and wait to sell for a profit until you are at 1 year and 1 day.Gotcha. So, If I sell 50 for 100% gain, I owe on the gain on the 50. Makes sense.
Oh well, worth an ask.
Thanks for the info
Old t-shirts appreciate, right?I didn't even think about charity.
You can donate appreciated assets to charity. That way you get the tax deduction and don't owe for the capital gains.
I’m not currently doing this but based on what you described I think it’s a great way to leave a legacy for the reasons you mentioned (no RMDs, no taxes for the benys).Craig_MiamiFL said:i've been looking into Roth 401k and Roth 457 recently. I will have other retirement sources so I'm not likely to ever touch this money and want to make as easy as possible (tax wise) to pass along when I die. From what I understand, it's more seamless to do this and then transfer to my Roth IRA down the road (and mandatory distribution not required at 70.5 or 72...whatever the age is that I can't recall off the top of my head)
Has anyone else been doing Roth 401k / Roth 457 (or perhaps doing a mix of 401k/Roth401k 457/Roth457 with their employer)? I'm pretty sure can move 401k to Roth IRA down the road regardless (I'd just have to foot the large tax bill at once) but was curious if anyone is doing the Roth 401k/Roth457 present day instead.
This. And if you regularly make charitable contributions, you can lump give this year (IE pay forward your expected giving over the next few years this year). One way to do this is through a donor advised fund. After funding the DAF, that money is no longer yours and is earmarked to give to charity but you get to decide to which charities and when. Fidelity and Vanguard both offer DAFs, which makes it easy to donate appreciated shares.I didn't even think about charity.
You can donate appreciated assets to charity. That way you get the tax deduction and don't owe for the capital gains.
I don't know if you're including Fundrise and other RE platforms, but I've been using Fundrise for a couple years now.Anybody have experience with some of the alternative asset FinTech platforms? I listen to the Animal Spirits podcast and their weekly "Talk your book" episode has exposed me to a lot of these ranging from BlockFi to Masterworks to Groundfloor. I have some cash sitting in a savings account earning nothing, and my current total portfolio is about 82% equities, 6% bonds, 12% cash, and a tiny bit of crypto, most of that in retirement accounts. I'd like to diversify a bit more, and thinking some of these, especially those not highly correlated to equities, might be a good place to put money to work. Secondary question, are there ways to incorporate any of these into an IRA?
Alert!Anyone have anything new or interesting happening?
Yup, that's another. Groundfloor was the most recent one, and it's a different kind of RE play in that they're loaning money to people buying/flipping houses. And that's about what I'm thinking for now - ease in to it and maybe build up to 5% allocation across a couple of these.I don't know if you're including Fundrise and other RE platforms, but I've been using Fundrise for a couple years now.
I wouldn't put more than 5% into any platform like these. But I might be more risk averse at this point than many.
I do lump 2 years into one to get away from the standard deduction. First year of the new standard deduction I came in right on top of it. Worst place to be, BTW. With the lumping I'm way into itemized one year and way below the standard the next. That's worth a couple K a year.This. And if you regularly make charitable contributions, you can lump give this year (IE pay forward your expected giving over the next few years this year). One way to do this is through a donor advised fund. After funding the DAF, that money is no longer yours and is earmarked to give to charity but you get to decide to which charities and when. Fidelity and Vanguard both offer DAFs, which makes it easy to donate appreciated shares.
Lumping is also a good strategy to lower tax burden if you regularly give but not enough to meet the standard deduction. By lumping 2-3 years worth's of contributions into one tax year you can exceed the standard deduction and get "credit" for at least some of your giving.
DAFs probably make a lot of sense in your situation. But your point is well received. I expect to set one up in the next few years, after thing #2 goes to college and we start to see the actual expenses. Right now it seems like an extra headache, but it probably would help with taxes.I do lump 2 years into one to get away from the standard deduction. First year of the new standard deduction I came in right on top of it. Worst place to be, BTW. With the lumping I'm way into itemized one year and way below the standard the next. That's worth a couple K a year.
I'll look into DAFs. Not sure I want to plot out giving that far in advance (my wife will want me to just give it all and then give more down the road), but it's certainly something to look into. Thanks!
I moved $5K into Groundfloor (took about 24 hours) and just used their investment tool to invest $100 or $110 in 47 different loans with an expected rate of return of 9.8%. I think I'll start looking into specific projects a bit, but figured this was a good way to get in and see how it works while spreading my risk across a bunch of loans.SFBayDuck said:Yup, that's another. Groundfloor was the most recent one, and it's a different kind of RE play in that they're loaning money to people buying/flipping houses. And that's about what I'm thinking for now - ease in to it and maybe build up to 5% allocation across a couple of these.
And apparently from you spending even more time building out spread sheets. I mean, what spread sheets could we expect if you had more time on your hands?-OZ- said:Alert!
I've perfected my spread sheet to provide a few outputs after all the inputs. The outputs show what happened if I stop bringing in income, how far away from "FI" we are, and how those get impacted if I die (insurance pays but they lose the pension and my income). If we paid the mortgage off (out of FI funds) and kept living like we do, our withdrawal rate would be just under 4% (the usual goal). If I died and my wife paid off the mortgage out of insurance, her withdrawal rate would be 4.5% if she didn't work (she will, but doesn't get paid a lot).
So, really the only reason I keep working is to pay for college (5x), for satisfaction, and so we can do more fun things.
401k's can suck if the business doesn't ensure they don't. It's surprising when they don't have an inexpensive broad market fund similar to VTSAX. I think it shows laziness by management as the accounts can be not only taking better care of employees but probably help retention among those who care about these things.Haha I love a good spread sheet.
I have a spread sheet with our account values and asset allocation. It's been hard to account for the Mrs. 401K.
My wife's 401K is in a Target Date fund and the options all suck. I recently realized you can look up the investments/asset allocation within the target date fund. I set it up such that the assets are a calculation based on the percentage of each asset x the total value. So as the amount changes, I can just edit the overall amount.
Of course, it's a target date fund. So it will change. But it solves a problem for now. I plan on taking the account over from Prudential soon and just handling the future investments. The target date fund is ~30% INTL funds. And my 401K through Schwab that I've let Schwab do the things with so far at about 28% INTL. I'd like to get that down to 20-25.
Such a huge cash cow for so many investment banks.401k's can suck if the business doesn't ensure they don't. It's surprising when they don't have an inexpensive broad market fund similar to VTSAX. I think it shows laziness by management as the accounts can be not only taking better care of employees but probably help retention among those who care about these things.
My "401k" has limited options but they're good options. (TSP)