Sand
Footballguy
I think we can safely add April to this list.January, February, and March would like to have a word with you.
I think we can safely add April to this list.January, February, and March would like to have a word with you.
Last year our total portfolio was positive every month until august. This year might be the opposite.I think we can safely add April to this list.
You already won. Most of us are still playing the game.I own 15-20 properties free and clear, absolutely 0 debt, wife and I have IRAs, HSAs, 403b, 401K, and iBonds, as well as college savings. Should I cash out refi all my properties just to possibly eek out a few more points? No, once you cross the finish line, you dont restart the rat race.
Absolutely positively don't #### this up. Unless you can clearly say what you have isn't enough. Once enough is achieved the utility of debt goes way way down. Like negative.I own 15-20 properties free and clear, absolutely 0 debt, wife and I have IRAs, HSAs, 403b, 401K, and iBonds, as well as college savings. Should I cash out refi all my properties just to possibly eek out a few more points? No, once you cross the finish line, you dont restart the rat race.
Can you start a hedge fund so I can invest?I own 15-20 properties free and clear, absolutely 0 debt, wife and I have IRAs, HSAs, 403b, 401K, and iBonds, as well as college savings. Should I cash out refi all my properties just to possibly eek out a few more points? No, once you cross the finish line, you dont restart the rat race.
Did you lose track?I own 15-20 properties free and clear, absolutely 0 debt, wife and I have IRAs, HSAs, 403b, 401K, and iBonds, as well as college savings. Should I cash out refi all my properties just to possibly eek out a few more points? No, once you cross the finish line, you dont restart the rat race.
Rentals - 10sfh 5 doubles.Chadstroma said:Did you lose track?
Really not liking the looks of our accounts right now.Last year our total portfolio was positive every month until august. This year might be the opposite.
Definitely. Looks like VTI is down like 20% since November. Brutal, but not totally unexpected.I think we can safely add April to this list.
This is my rule. If it starts bothering me, I stop looking. It'll be better at some point.-OZ- said:Really not liking the looks of our accounts right now.
so I’ll stop looking.
Definitely. Looks like VTI is down like 20% since November. Brutal, but not totally unexpected.
Would buying a vacation home be considered ####### up? Semi serious question. This is the only thing I could seriously see us going into debt for.Absolutely positively don't #### this up. Unless you can clearly say what you have isn't enough. Once enough is achieved the utility of debt goes way way down. Like negative.
Probably not. The point was that you've largely won the game so why dive back in? If you're buying a 2M property on 75k rental income, that's a problem. If it's a 300k property on 200k rental income then sure, no big deal. You're a RE guy, so you know this stuff way better than I do. Keep debt load down and stay within the "FU, I won" zone and all is well.Would buying a vacation home be considered ####### up? Semi serious question. This is the only thing I could seriously see us going into debt for.
Even if you cash in early and lose 3 months interest you're way ahead of a bank or CD. I've stuffed the box and bought through 2025. If that ends up being 4-5% 5 years down the line that's a great investment on a risk adjusted basis.Took the plunge and bought I Bonds with some of my cash reserve fund, which are paying 9.62% right now for the first six months. I'd prefer to be more liquid with that money, but there's very little chance I'll need it and my bank is paying virtually 0% in interest right now. Making nearly nothing from the bank is irritating.
Right, with the additional limitation that you can't sell within 1 year, so it's got some drawbacks as a way to invest one's rainy day fund.Even if you cash in early and lose 3 months interest you're way ahead of a bank or CD. I've stuffed the box and bought through 2025. If that ends up being 4-5% 5 years down the line that's a great investment on a risk adjusted basis.
Thinking I might buy and gift to each of us, and sell next June if the rate is low, as we look to buy a vehicle next year. That’s just $20k extra, with $50k already in hand. But I’m not willing to sell stock to do it and any loan will be at 2.25%. So I’m not completely sold on the plan.Even if you cash in early and lose 3 months interest you're way ahead of a bank or CD. I've stuffed the box and bought through 2025. If that ends up being 4-5% 5 years down the line that's a great investment on a risk adjusted basis.
And 6 days in, May as well.I think we can safely add April to this list.
You can withdraw any time after 1 year. If you withdraw before 5 years, you forfeit the last 3 months of interest. I've heard some people advocate that if the interest rates turn to crap--you should leave it there for the 3 months so you forfeit 3 months of bad interest instead of your 5+%. Obviously opportunity cost--3 months to get 5% when you could be using the money other things, but I do like a safe 5%.So I bonds as a college savings vehicle - making sure I get the mechanics here. My wife and I can both buy $10k worth if I bonds, with a current rate of 9.something, which resets each May and October. Assuming inflation stays high to moderate and the rate is 5%+ we’ll leave it there and use basis and (tax free) interest for our 6 year olds college.
Question is what happens if rate drops and I want to get my basis out. Can I do that or is any withdrawal considered interest first? Anything else to consider with these?
I’ve read that interest is tax free if used for college. We’ll also be doing a 529, but you’re limited to the tax write off each year (and it’s only a state tax deduction on deposits). With I bond so long as it’s used for college the interest is fed tax free (and it’s state tax free regardless).You can withdraw any time after 1 year. If you withdraw before 5 years, you forfeit the last 3 months of interest. I've heard some people advocate that if the interest rates turn to crap--you should leave it there for the 3 months so you forfeit 3 months of bad interest instead of your 5+%. Obviously opportunity cost--3 months to get 5% when you could be using the money other things, but I do like a safe 5%.
The other thing I would consider with these as college savings vehicles is taxes. You'll be taxed on your gains with this. Whereas a 529 is typically tax free if I'm not mistaken. If college is 12 years out, you may start out a little more risky (more stocks) in a 529, and then start trending more towards bonds as college grows near.
I did not realize that about education. You're correct.I’ve read that interest is tax free if used for college. We’ll also be doing a 529, but you’re limited to the tax write off each year (and it’s only a state tax deduction on deposits). With I bond so long as it’s used for college the interest is fed tax free (and it’s state tax free regardless).
My question, which I doubt, is if I can withdrawal my basis in a few years if rates drop but leave interest there for college down the road. Or would I have to take principal and interest upon redemption.
You can cash a minimum of $25 or any amount above that in 1-cent increments. If you cash only a portion of the bond's value, you must leave at least $25 in the TreasuryDirect account. Redemptions are comprised of principal and interest. (In a partial redemption, we pay interest only on the partial amount you cash.)
Dang, that’s worst case scenario if using this for college as any redemption before college would be fully taxable. So I’d be locking in all deposits for ~12 years given my son is in kindergarten if I want interest to be tax free. I guess if rates go down considerably I’ll just withdrawal and put funds somewhere that’s earring something and that would counter the tax bill on gains.
Thank you for assuming I’m a true FBG. I am not.Pretty sure there are income limits to this as well, once above that the tax-free treatment goes away.
Not sure on that one, but did run across this relevant topic on BG: https://www.bogleheads.org/forum/viewtopic.php?t=375783I’ve read that interest is tax free if used for college. We’ll also be doing a 529, but you’re limited to the tax write off each year (and it’s only a state tax deduction on deposits). With I bond so long as it’s used for college the interest is fed tax free (and it’s state tax free regardless).
My question, which I doubt, is if I can withdrawal my basis in a few years if rates drop but leave interest there for college down the road. Or would I have to take principal and interest upon redemption.
What are you unsure of?Not sure on that one, but did run across this relevant topic on BG: https://www.bogleheads.org/forum/viewtopic.php?t=375783
Maybe it helps, maybe not.
Really the gains won’t be that huge anyway. and easily offset by losses.matttyl said:Dang, that’s worst case scenario if using this for college as any redemption before college would be fully taxable. So I’d be locking in all deposits for ~12 years given my son is in kindergarten if I want interest to be tax free. I guess if rates go down considerably I’ll just withdrawal and put funds somewhere that’s earring something and that would counter the tax bill on gains.
I wish I could get locked out of my brokerage account.So caution about i-bonds. The customer support is the worst I've ever seen. I managed to lock my account and I've been trying to call for three days. I've been on hold for 6 hours and yet to speak with anyone. You email them and they direct you to call them.
YepSo caution about i-bonds. The customer support is the worst I've ever seen. I managed to lock my account and I've been trying to call for three days. I've been on hold for 6 hours and yet to speak with anyone. You email them and they direct you to call them.
Well, that settles that then…I’m just going to continue to lose 10% in BND. THE CUSTOMER SERVICE IS GREAT!So caution about i-bonds. The customer support is the worst I've ever seen. I managed to lock my account and I've been trying to call for three days. I've been on hold for 6 hours and yet to speak with anyone. You email them and they direct you to call them.
You are not use to dealing with any government agency, are you?So caution about i-bonds. The customer support is the worst I've ever seen. I managed to lock my account and I've been trying to call for three days. I've been on hold for 6 hours and yet to speak with anyone. You email them and they direct you to call them.
Anyone else just like “F it. I didn’t want to retire any time soon anyway.”
I'm 15 years out. It can keep going down for all I care. I'll keep buying. Hope those newly retired folks have some cash reserves to tap into.
She should be fine. You just need an empty traditional IRA.Question. My wife never opened a ROTH IRA and now that we're married our income is past the phase out limit.
Can she still open ROTH IRA and do a back door? Or is she screwed because she didn't have a ROTH IRA prior to exceeding the income limit?
The difference between the two dates is so small I'd just take it now - I can't see any mathematical reason not to take it. Take the 75% and not look back. Use the money to make memories.Looking for advice on a pension situation.
Some basics:
I ran two calculations on the pension web site today:
- I am 53 and working.
- Currently in the 24% tax bracket.
- My wife is disabled; though she is covered by Medicare, it is secondary to my employer insurance, and I perceive the benefit of the employer insurance + Medicare to be substantial enough that I expect to work to age 65 or later, assuming she lives that long.
- We do not have children.
- As things stand today, we don't really need to rely on this pension in our retirement.
Choices include:
- July 1, 2022 - soonest I can access any benefit
- Dec 1, 2033 - latest I can access any benefit (month after I turn 65)
- Lump sum - "a single lump sum payment of [amount], calculated as of [date], which represents your entire interest under the plan"
- Various monthly annuities
Single life annuity - monthly benefit for my lifetime
- 5 year certain and life - lower monthly benefit than previous, with 5 years of payments guaranteed; lump sum remainder goes to beneficiary in event of my death
- 50% joint and contingent annuity - lower monthly benefit than previous; beneficiary gets 50% of the amount for the remainder of her life in the event of my death
- 66 2/3% joint and contingent annuity - lower monthly benefit than previous; beneficiary gets 66 2/3% of the amount for the remainder of her life in the event of my death
- 75% joint and contingent annuity - lower monthly benefit than previous; beneficiary gets 75% of the amount for the remainder of her life in the event of my death
- 100% joint and contingent annuity - lower monthly benefit than previous; beneficiary gets 100% of the amount for the remainder of her life in the event of my death
Here are the benefits available on July 1, 2022:
Here are the benefits available on Dec 1, 2033:
- Lump sum payout - $52,469
- 50% joint and contingent annuity - $200.87 per month
- 75% joint and contingent annuity - $194.83 per month
I can evaluate starting the annuities sooner, but even 1 year earlier, it drops to from $281 to $248/month. Almost 12%.
- Lump sum payout - $53,192
- Single life annuity - $281.24 per month
- 5 year certain and life - $279.50 per month
- 50% joint and contingent annuity - $255.08 per month
- 66 2/3% joint and contingent annuity - $247.41 per month
- 75% joint and contingent annuity - $243.75 per month
- 100% joint and contingent annuity - $233.37 per month
Until rechecking this, I didn't remember that I could actually take a lump sum benefit now. It surprised me that the lump sum 11+ years from now is less than $1K more than if I take it next month. The fact that the amounts differ seems to show these amounts are accounting for estimated growth that would occur by waiting. It isn't much, but it makes sense that pension funds wouldn't be invested in growth assets.
Obviously, if I take a lump sum next month, it would be taxable, so I would probably lose 1/3 of it or so. But then I would have $33K or so to invest in the market. I expect it could grow back to 50K by Dec 2023, assuming I didn't lose much to capital gains taxes. That is a fairly conservative annualized return (~4%).
Of course, I might not be alive in 2033, and my wife might not be either. In that case, taking lump sum now is a win, since there won't be anyone to receive the benefit.
If she and I are both alive in Dec 2033, I will probably still be working at 65, as stated above. So I can't necessarily count on my tax rate to be much reduced. In fact, there is probably as good a chance of me being in a higher tax bracket as a lower one, whether due only to my (hopefully) increasing income by then and/or tax bracket changes implemented by our Government. So I might actually get paid out (if I took lump sum) a lower amount 11 years from now than I would next month. That scenario seems to make taking lump sum now a win.
If I am not alive but my wife is, I am uncertain what benefits she gets if we have not started one of the annuities by the time I pass away. She would certainly be in a lower tax bracket. Though, honestly, I am skeptical she will outlive me by much. So this scenario may not matter much.
If I were alive but she is not, it is conceivable that I could retire early, and thus taking a lump sum then could generate lower taxes, but I'm still not sure that would end up as more than taking it next month and investing.
I'm having trouble seeing a scenario where it makes more sense to wait than to take the lump sum next month.
It seems likely I am I missing something. Thoughts? I appreciate any help any of you have to offer.
I'm no financial advisor, but lump sum now seems to make sense.Looking for advice on a pension situation.
Some basics:
I ran two calculations on the pension web site today:
- I am 53 and working.
- Currently in the 24% tax bracket.
- My wife is disabled; though she is covered by Medicare, it is secondary to my employer insurance, and I perceive the benefit of the employer insurance + Medicare to be substantial enough that I expect to work to age 65 or later, assuming she lives that long.
- We do not have children.
- As things stand today, we don't really need to rely on this pension in our retirement.
Choices include:
- July 1, 2022 - soonest I can access any benefit
- Dec 1, 2033 - latest I can access any benefit (month after I turn 65)
- Lump sum - "a single lump sum payment of [amount], calculated as of [date], which represents your entire interest under the plan"
- Various monthly annuities
Single life annuity - monthly benefit for my lifetime
- 5 year certain and life - lower monthly benefit than previous, with 5 years of payments guaranteed; lump sum remainder goes to beneficiary in event of my death
- 50% joint and contingent annuity - lower monthly benefit than previous; beneficiary gets 50% of the amount for the remainder of her life in the event of my death
- 66 2/3% joint and contingent annuity - lower monthly benefit than previous; beneficiary gets 66 2/3% of the amount for the remainder of her life in the event of my death
- 75% joint and contingent annuity - lower monthly benefit than previous; beneficiary gets 75% of the amount for the remainder of her life in the event of my death
- 100% joint and contingent annuity - lower monthly benefit than previous; beneficiary gets 100% of the amount for the remainder of her life in the event of my death
Here are the benefits available on July 1, 2022:
Here are the benefits available on Dec 1, 2033:
- Lump sum payout - $52,469
- 50% joint and contingent annuity - $200.87 per month
- 75% joint and contingent annuity - $194.83 per month
I can evaluate starting the annuities sooner, but even 1 year earlier, it drops to from $281 to $248/month. Almost 12%.
- Lump sum payout - $53,192
- Single life annuity - $281.24 per month
- 5 year certain and life - $279.50 per month
- 50% joint and contingent annuity - $255.08 per month
- 66 2/3% joint and contingent annuity - $247.41 per month
- 75% joint and contingent annuity - $243.75 per month
- 100% joint and contingent annuity - $233.37 per month
Until rechecking this, I didn't remember that I could actually take a lump sum benefit now. It surprised me that the lump sum 11+ years from now is less than $1K more than if I take it next month. The fact that the amounts differ seems to show these amounts are accounting for estimated growth that would occur by waiting. It isn't much, but it makes sense that pension funds wouldn't be invested in growth assets.
Obviously, if I take a lump sum next month, it would be taxable, so I would probably lose 1/3 of it or so. But then I would have $33K or so to invest in the market. I expect it could grow back to 50K by Dec 2023, assuming I didn't lose much to capital gains taxes. That is a fairly conservative annualized return (~4%).
Of course, I might not be alive in 2033, and my wife might not be either. In that case, taking lump sum now is a win, since there won't be anyone to receive the benefit.
If she and I are both alive in Dec 2033, I will probably still be working at 65, as stated above. So I can't necessarily count on my tax rate to be much reduced. In fact, there is probably as good a chance of me being in a higher tax bracket as a lower one, whether due only to my (hopefully) increasing income by then and/or tax bracket changes implemented by our Government. So I might actually get paid out (if I took lump sum) a lower amount 11 years from now than I would next month. That scenario seems to make taking lump sum now a win.
If I am not alive but my wife is, I am uncertain what benefits she gets if we have not started one of the annuities by the time I pass away. She would certainly be in a lower tax bracket. Though, honestly, I am skeptical she will outlive me by much. So this scenario may not matter much.
If I were alive but she is not, it is conceivable that I could retire early, and thus taking a lump sum then could generate lower taxes, but I'm still not sure that would end up as more than taking it next month and investing.
I'm having trouble seeing a scenario where it makes more sense to wait than to take the lump sum next month.
It seems likely I am I missing something. Thoughts? I appreciate any help any of you have to offer.
Are you certain the lump sum would not be eligible for a rollover to an IRA? You may have a qualifying event based on the plan rules. I would check with the plan administrator.Looking for advice on a pension situation.
Some basics:
I ran two calculations on the pension web site today:
- I am 53 and working.
- Currently in the 24% tax bracket.
- My wife is disabled; though she is covered by Medicare, it is secondary to my employer insurance, and I perceive the benefit of the employer insurance + Medicare to be substantial enough that I expect to work to age 65 or later, assuming she lives that long.
- We do not have children.
- As things stand today, we don't really need to rely on this pension in our retirement.
Choices include:
- July 1, 2022 - soonest I can access any benefit
- Dec 1, 2033 - latest I can access any benefit (month after I turn 65)
- Lump sum - "a single lump sum payment of [amount], calculated as of [date], which represents your entire interest under the plan"
- Various monthly annuities
Single life annuity - monthly benefit for my lifetime
- 5 year certain and life - lower monthly benefit than previous, with 5 years of payments guaranteed; lump sum remainder goes to beneficiary in event of my death
- 50% joint and contingent annuity - lower monthly benefit than previous; beneficiary gets 50% of the amount for the remainder of her life in the event of my death
- 66 2/3% joint and contingent annuity - lower monthly benefit than previous; beneficiary gets 66 2/3% of the amount for the remainder of her life in the event of my death
- 75% joint and contingent annuity - lower monthly benefit than previous; beneficiary gets 75% of the amount for the remainder of her life in the event of my death
- 100% joint and contingent annuity - lower monthly benefit than previous; beneficiary gets 100% of the amount for the remainder of her life in the event of my death
Here are the benefits available on July 1, 2022:
Here are the benefits available on Dec 1, 2033:
- Lump sum payout - $52,469
- 50% joint and contingent annuity - $200.87 per month
- 75% joint and contingent annuity - $194.83 per month
I can evaluate starting the annuities sooner, but even 1 year earlier, it drops to from $281 to $248/month. Almost 12%.
- Lump sum payout - $53,192
- Single life annuity - $281.24 per month
- 5 year certain and life - $279.50 per month
- 50% joint and contingent annuity - $255.08 per month
- 66 2/3% joint and contingent annuity - $247.41 per month
- 75% joint and contingent annuity - $243.75 per month
- 100% joint and contingent annuity - $233.37 per month
Until rechecking this, I didn't remember that I could actually take a lump sum benefit now. It surprised me that the lump sum 11+ years from now is less than $1K more than if I take it next month. The fact that the amounts differ seems to show these amounts are accounting for estimated growth that would occur by waiting. It isn't much, but it makes sense that pension funds wouldn't be invested in growth assets.
Obviously, if I take a lump sum next month, it would be taxable, so I would probably lose 1/3 of it or so. But then I would have $33K or so to invest in the market. I expect it could grow back to 50K by Dec 2023, assuming I didn't lose much to capital gains taxes. That is a fairly conservative annualized return (~4%).
Of course, I might not be alive in 2033, and my wife might not be either. In that case, taking lump sum now is a win, since there won't be anyone to receive the benefit.
If she and I are both alive in Dec 2033, I will probably still be working at 65, as stated above. So I can't necessarily count on my tax rate to be much reduced. In fact, there is probably as good a chance of me being in a higher tax bracket as a lower one, whether due only to my (hopefully) increasing income by then and/or tax bracket changes implemented by our Government. So I might actually get paid out (if I took lump sum) a lower amount 11 years from now than I would next month. That scenario seems to make taking lump sum now a win.
If I am not alive but my wife is, I am uncertain what benefits she gets if we have not started one of the annuities by the time I pass away. She would certainly be in a lower tax bracket. Though, honestly, I am skeptical she will outlive me by much. So this scenario may not matter much.
If I were alive but she is not, it is conceivable that I could retire early, and thus taking a lump sum then could generate lower taxes, but I'm still not sure that would end up as more than taking it next month and investing.
I'm having trouble seeing a scenario where it makes more sense to wait than to take the lump sum next month.
It seems likely I am I missing something. Thoughts? I appreciate any help any of you have to offer.
When my dad retired he took the lump sum and it rolled over into an IRA.Are you certain the lump sum would not be eligible for a rollover to an IRA? You may have a qualifying event based on the plan rules. I would check with the plan administrator.
Great question, and I don't know the answer yet. If I can roll it into my Roth IRA, I will.When my dad retired he took the lump sum and it rolled over into an IRA.Are you certain the lump sum would not be eligible for a rollover to an IRA? You may have a qualifying event based on the plan rules. I would check with the plan administrator.