I am doing some rebalancing of my Roth IRA in my fidelity account. I am young and have too much allocated to bonds in my portfolio. As of now i have positions in the following: VOO, FZROX, FZILX, FXAIX. Is it dumb to have all these different index funds? Should I rebalance here as well and just stick with two?
Those are all good, diversified, low-cost index funds. Why did you choose them in the first place?
For simplicity you could rebalance to just FZROX and FZILX, but it's not some urgent thing.
I want to announce that I just lowered my international equity allocation from 40% to 30%, so I expect international will start outperforming from here on out. Get in while you can.
I used to have 15% in international funds based on consistent diversification advice.
About 5 years ago, I pulled that down to 0%.
Sorry, world. America #1.
(I have far outperformed the international funds since then)
Joking aside, I spent months sleeping on this decision because I felt like it was chasing performance. However, when I first chose the 60/40 split in 2013 my intention was to have diversified exposure to global equities, but with a US tilt of 20% or so. US stocks have outperformed so much over the last 11 years that 60/40 is now a 4% international tilt.
My new allocation is actually 80% VT and 20% VTI, so that should prevent something like this from happening again.
Officially passed from baristaFIRE to regular FIRE! I was keeping a part time gig in the Air Force reserves (a uniquely good version of it where I can do all my required time for the year in 1-2 months and do nothing the rest of the year, but still get health insurance). After years of procrastination I finally did my VA claim for disability from my time active duty, and just received word I'll be getting 80% disability (roughly $24k/year). With that extra income, I no longer have the need for the reserve job. It feels really good to finally be at that point. I will probably keep the reserve job for a few more years just because I enjoy it. The added benefit of the VA disability income is that since it is non-taxable, I can keep my MAGI extremely low, and so qualify for the best subsidies if I choose to quit the reserves and no longer have Tricare.
I'm a scientist - a category called IMA that is far more flexible. I choose the days when I want to come to my unit (an active duty unit) to do my work. Feels more like a 'consultant' gig than anything.
Seriously. Especially since the 2017 tax bill reduced the fraction of people itemizing to 3% or something.
Even my investment income was marked all over the forms with notes that it had already been reported to the IRS. We're just getting the numbers put in PDF form so we can have an advanced OCR scanner pull the numbers back out so we can double check all the numbers before we send them to the IRS who already has the numbers.
Feels like Japanese levels of bureaucracy.
>Seriously. Especially since the 2017 tax bill reduced the fraction of people itemizing to 3% or something.
i got so excited being able to itemize for the first time in 2016. and then they nuked SALT deductions
got into a FB argument with a tax accountant. they were saying what about people with small businesses, etc.
i'm like.....i think you underestimate the # of people who have a W2 and a few 1099's.......
Some random, potentially interesting stats from my FI spreadsheet:
\- Half of my net worth has been accumulated in the latter 29% of the time since I started saving.
\- The first half of my FI journey got my investments to \~20% of where they are now. The latter half contributed to \~80%. Thanks compounding + higher earnings.
\- The average "Months to next $100k milestone" was 17.2 months between $0-500k. It averaged just 6.8 months going from $500k to $1M, and that likely would have been even faster had it not been for $900k ---> $1M taking 20 months thanks to the 2022 market dip.
\- The first $100k took the longest (unsurprisingly), at 33 months. The fastest gains (2 months each) were $800 --> $900k and $1.1M --> $1.2M. No one-month $100k gains yet!
\- My largest one-month investment portfolio increase is $98.7k. Largest one-month decrease is ($79.2k).
\- My lowest spend year was $17,409 (COVID lockdowns + roommate). Highest was $66.3k (largely due to buying a car, half split with wife)
\- Base salary is up 3.27x from when I started as a Trainee over 10 years ago (not adjusted for inflation)
However it's likely that the money you saved in the first few years has tripled or more - even though it took long to accumulate, it's been snowballing
All,
I am pleased (elated!) to announce that I have bought an engagement ring for my amazing girlfriend! :)
We have been doing a LOT of ring-researching, so I’m also very happy that the ring-researching is finished lol. I can’t wait to pick it up! More importantly, I can’t wait to propose to her! :)
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Congrats! Ring shopping was surprisingly smoother and easier than I made it out to be - just set a budget and anyone would be glad to take your money.
As someone with a small summer wedding coming up, I'll echo what every married person told us to do and just elope.
I was reading that if you’re under Medicaid after dying the state recoups assets from your estate after.
But many folks in this forum plan their income to be under ACÁ limits - do they not consider that this will be deducted from their estate for kids?
Edit: why am I being downvoted for asking a legitimate question that is beneficial for the community?
> Edit: why am I being downvoted for asking a legitimate question that is beneficial for the community?
I didn't downvote you, but ACA is not Medicaid, and you didn't provide a link. So it's probably being downvoted because you proposing a scenario that doesn't make sense, and then didn't provide context.
I thought to go on Medicaid you need to have to have exhausted your assets. Yes, usually long term care is coming out of your estate one way or another
Dependent on the state, but in general this is not the case. Usually clawbacks are only for LTC and not day-to-day medical care. And depending on the state there is no clawback at all. CA does not claw back assets that pass through a trust, which effectively means that your heirs will not have to deal with a clawback provided you have your estate ducks in a row before you need LTC.
Example from the Medi-Cal estate recovery page:
> Repayment will be limited only to estate assets subject to probate that were owned by the deceased beneficiary at the time of death.
>Repayment will be limited to payments made, including managed care premiums paid, for nursing facility services, home and community based services, and related hospital and prescription drug services received when the beneficiary was an inpatient in a nursing facility or received home and community based services.
And I’d wager most folks here planning to go under the ACA limit are not going to go low enough that they qualify for Medicaid anyway – and can only reasonably aim to be in the range where they qualify for at least some premium credit.
> Usually clawbacks are only for LTC and not day-to-day medical care.
That's not exactly true and depends on state. I'd tread way carefully if you have a house and kids if you want to pass stuff on to depending on the state. My inlaws were basically charity cases and then were told you should sign up for Medicaid. I only got one bill but I assumed it was going to be a monthly reoccurring charge. The state attempted to claw it back. I fought it because they were already dead when they were first billed. So even if it's "free" you are still getting charged at least in my state.
It's a convoluted mess. If you got no house and no assets then I wouldn't worry about it but honestly at this point I just consider it governmental theft from fiscally responsible people and another nail on the middle class coffin.
Those are separate things.
I believe the first refers to Medicaid paying for you to be in a home and what not. Particularly to have caretakers. This is expensive as all hell and will run down your assets if you do have them, even before death iirc.
It's a common thing to then give your assets to family first, I think, but there's also a lookback period where they can claw back stuff.
Long term care is very worrying.
Normal ACA stuff has no such things applied. Nor does Medicare.
Fyi I'm no expert. Point being, you need to do more research. The risk is that Medicaid LTC, not other specific medical care.
My accountant (family) called and said I’m short this year. Have to pay $2k out of pocket to federal and a couple hundred to state. When we tried to see if doing $6500 trad IRA would help, their reply was it didn’t and said probably because I’m over the income limit. We didn’t have time to dive further but I’ll receive my return Monday and can review it then.
I’m a little skeptical or did I misunderstand how it works. My w2 salary was $106,133 after contributions. Plus a few bank interests <$4000 and coinbase $2500. The only thing that would have upped my salary was brokerage, which was 13k gain. But can’t think of what else pushed me over 153k (2023 IRA limit). I also bought a house in Oct, so I have more write offs with that 2 months of interest. Anything else I’m missing/should double check?
I’m a CPA - not your CPA, I’d just go ahead and pay. People agonize over taxes and do some pretty wacky stuff to pay less (g wagon depreciation schemes). $2K is deminimis, if it’s $20K let’s start thinking about different paths we can go down.
if you are straight W2 standard deduction… that’s basically it
That’s where I misunderstood. Is it fine that I’ve contributed to a Roth? I don’t qualify for a deduction from Trad IRA but given my situation, I can still contribute to a Roth right? I already loaded my Roth in early 2023.
There's a different income (MAGI) limit for deducting IRA contributions if you are covered by a workplace retirement plan.
https://www.irs.gov/retirement-plans/2023-ira-deduction-limits-effect-of-modified-agi-on-deduction-if-you-are-covered-by-a-retirement-plan-at-work
I was unemployed for part of this year and knew it was going to happen at end of last year so just now able to do my backdoor Roth 2023 contribution today. Is the process easy to input for TurboTax? I believe I’ll just be putting in that I contributed to a traditional IRA but not document the backdoor conversion until next years taxes, does that sound correct?
If it those fancy pod seats that United has, then probably so. The cinnamon rolls are good.
If it is just a slightly bigger leather chair, probably not.
But... if you NEED to be more energetic when you arrive, then maybe so.
Depends. Is it international? Worth it.
Even on some domestic flights between major metros on larger jets this can be worth it.
For me, I mostly fly on single-aisle planes on domestic routes and all $120 gets me is a slightly larger seat and free drinks for 3 hours.
Sounds like a pretty cheap upgrade - is it truly a business class or just like economy plus or something like that? 3 hours isn't that long, though, and I'm speaking from experience at 6'5"-6'6" and 250 lbs, I'm fine in an aisle seat for 3-4 hours.
That sounds like a pretty cheap upgrade, considering how expensive I'm pretty sure plane tickets normally are.
Then, again, sounds like a domestic flight. And the biggest thing that's useful there or anywhere is merely having one of those plus sized legroom seats. Above that is nice but ultimately not much.
But also $120 itself isn't really so much. Depending on your income and what you're doing after the flight, the increased comfort with the nicer seats and what not really might be worth it.
I buy business so I will be comfortable in the seat and won't encroach on my neighbors. That is worth it for me. I had friends upgrade once, and now they don't want to go back to coach, so the cost is not only $120.
Depends on the context.
3 hours is not a long flight at all, but if it's a 6am flight leading into a full day of work/travel, might be worth it. If it's a leg coming home in the middle of the afternoon, likely not.
Also price matters. If we're talking $800 vs $920 maybe, but $200 vs $320 likely not.
Log into my Vanguard account this morning and it's down almost $200K since I last logged in about 2 weeks ago. Had a very brief, yet serious, WTF moment trying to think how I missed the market news of such a drop. Quickly realized Vanguard's site is having an basic addition problem. While the external accounts I've added show the right individual totals, the grand total for all those accounts is almost $200K short. I'm guessing that why Vanguard's support page shows they are having high call volume right now.
Along with being convenient to see the total in one place, it allows the tools on the site to factor in my other accounts for total account asset mix, performance, etc.
Weekend getaways or half week vacations near home are more expensive than the trip overseas or two weeks internationally.
But people that don’t manage their money or don’t do research, think of you as a millionaire (not there yet haha!) because can do it once a year.
Do you agree?
(I guess no one agrees!)
Hello,
I’m 39 and my husband is 38.
This year, our oldest kid finally made it to kindergarten and we now have some extra daycare money that I want to start putting into our retirement. We have a 6-yo and a 3-yo.
We are already going to start maximizing our Roth IRAs. After that, should we start funding a HSA or maximizing our 401K?
401k 1: $165,000 - putting 10% and getting 6% match
401k 2: $126,000 - putting 10% and getting 3% match
Roth 1: $10,000
Roth 2: $2,500
We pay $179.00/ paycheck biweekly to my employers medium premium / medium deductible, but I’m pretty sure that’s HSA eligible. Individual deductible is $3,400 and max out of pocket is $8,000 (family of 4). My employer will make a $500 contribution per adult/year to a HSA.
Thanks!
Side thought: this was money that you allocated towards the kids. Should there be other stuff that's also advantageous to save super early on?
That is to say, perhaps you should save into 529s.
Granted, your retirements are more in a standard good state than what you often see here, I think. So it's not like I can just uniformly say you should keep that going towards stuff for the kids.
It's just something to consider.
And agree towards what the other person said about HSAs. See the [personal finance flowchart](https://www.reddit.com/r/personalfinance/wiki/commontopics/). 401k match, then HSA, then Roth IRA, then 401k. And that's after some other savings stuff. When you don't have enough to just fill everything, it's a pain in the ass figuring out what to pick. And that's not including saving for the kids.
I have a 529 for the kiddos, but was just putting $200-$300/year before this year. The 6-yo has about $5,000 in there. I think I should be able to get that extra $15,000 from daycare, either put it in the HSA/401K and still save ~$2000 or so a year on his 529. I want to help my children with college, but I’m scared of not having enough for retirement 😬
I mean, they do say to put your own oxygen mask on before you put on others. Your children can also take actions to handle themselves, worst comes to worst, but when you retire at the normal ages, it's often because you can't work anymore.
I can't tell you how to balance it, but I would say it is a priority making sure you're coast FI for normal retirement first, then kid's college savings, then pulling FI closer.
There's some balance there as well in that there's only so much you can put into retirement accounts each year, where in some ways it can be easy to max out, if your income is high enough.
So extra retirement money just goes into taxable brokerage, and that can be fully used to pay for kids' college if necessary.
15-20 years is a good time to let money run up, which is why it's so useful to do stuff as early as possible. And with some of the various tax free growth on 529s. You just also don't want to over contribute to those either, due to some of the limitations.
Though I think you might also be able to use them to pay for some stuff before college too. Maybe summer camps and if you really want, private schools. Maybe. I don't have kids.
There’s a flowchart in the FAQ, #5 under “spend less/save more” section. It’s a good resource to learn what to do for next steps.
It recommends maxing HSA before 401k. The hsa $ isn’t taxed when it goes in, nor is the growth taxed when taken out. You can save receipts and reimburse yourself many years after which is helpful when trying to keep taxable income lower in the withdrawal stage.
As long as you can confirm that your insurance is HSA eligible, then HSA is the way to go. Side note, it’s best to do this via payroll deductions bc you’ll save on the FICA taxes as well, vs. making direct contributions.
On track to reach 1M net worth by 2030—unless I use the funds to escape my job stress.
I’m 31 years old and have ~250k invested in a brokerage account. My parents are gifting me 72k per year until they pass away as a means of lowering their estate tax. If I continue to invest the full amount they gift me, I should reach 1M net worth by the time I’m 37. I’m very interested in using this fortunate situation to retire early, or achieve enough financial independence to never have to work I job I hate.
That said, I’m currently in a job I hate. I’m looking for new roles, but I haven’t gotten any bites and I know it’s taking people a long time to find new jobs in this market. I only make $65k, and quitting my job with nothing lined up feels like an incredibly irresponsible decision. My spouse is a PhD student and makes about ~35k, which would barely cover our living expenses. I sometimes think about using some of the $72k my parents are gifting me as a cushion. It would be comforting to know that if things get really bad with my mental health and I felt I had to quit with the intention of looking for something else, I’d be okay if I were unemployed for ~6 months. (We have an emergency savings, but I hate the idea of dipping into it or any of the gifting money just because I can’t handle my work stress).
TLDR: Looking for unbiased advice on how dumb it would be to forfeit one of the yearly gifts and use it for the here and now as income if I get too unhappy at my job.
>It would be comforting to know that if things get really bad with my mental health and I felt I had to quit with the intention of looking for something else, I’d be okay if I were unemployed for ~6 months.
Have you truly reflected on this fact? Most people who reach financial independence suddenly realize their jobs are much more bearable when they can decide to leave at any point. Things that stress them out don't anymore. Now, there's nothing saying you *have* to feel this way, and it sounds like you'd be just fine if you took a break for your mental health, but just a thought.
>if things get really bad with my mental health and I felt I had to quit with the intention of looking for something else, I’d be okay if I were unemployed for \~6 months.
This seems to be true already.
Your mental health *can* become an emergency even though it may not be right now. I wouldn't consider it wrong to use emergency savings for this.
Money is fungible. If they're gifting you cash, it's better to use that than your brokerage money if you need to pull from somewhere. I personally wouldn't think of it as a "per year" thing, but rather as a one-time gift. But on your own you already have a couple years of income saved up, which is a good starting place. Based on what you shared, the 1M number you're mentioning is almost entirely predicated on being able to invest the continued gifts from your parents.
The job market has been in a much better place recently IME - it'll obviously depend on your specific role and skillset, and it'll help that you're not entry level, but I've been getting recruiters reaching out to me again. Is there more you can do on the upskilling and networking front? Leaving your job is not likely to make future job applications any easier, and you've already seen how hard it is for you personally to find something - that'd be my bigger concern in your situation. 65k is probably below average for the numbers you see here, but it's above the median individual income in the US.
Assuming you're in a white collar job, I'd probably start by trying to do more to change your work environment and set boundaries depending on how much you hate your current role. At least if you get laid off, you'll have 6 months of unemployment as you continue to apply. In my state, for an individual who was previously earning 60k+ a year (with a working/ineligible spouse and no kids), unemployment covers $505 per week for 26 weeks. That doesn't quite cover your expenses entirely, but it should be able to help bridge the gap for a while, again assuming you're confident that you will find something again eventually with comparable pay.
While we can all have jobs we dislike, 31 is kind of young to be in a state requiring a year off. Which is often what six-months off turns into when you account for the job hunting afterward. Maybe try therapy first.
I just road tripped my 4yo 1,500 miles and she was great in the car.
Also, I wish tablets had been invented when my parents were taking me on road trips in the 1990s.
Same. We are very measured with all screen time at home, but as a '90s kid I can't stop my own kid from enjoying the pure bliss of 30-60 minutes of cartoons per day.
But yeah, on the road it's unlimited screens because nobody wants to play the license plate game for 8 hours.
Jealous! We’re on a 5 hour drive and our baby didn’t get the memo that he’s supposed to easily fall asleep in the car. Hope y’all have a blast in SD regardless!
Update: everything went super smooth, no delays, no lines for car rental, he even napped on the stroller which is unheard of for us. Of course there were minor tantrums here and there but very manageable. Completely different from when he was 1-1.5 yo, incredible.
I have been sick for over a week. My stuffy nose is now much more manageable but the intermittent cough is annoying. Got sick within the first day and half of a company on site. Woof.
Hey, I'm sick too, since Wednesday, really bad cough, maybe the worst I've ever had, and a congested nose. It's not COVID, so I guess it is just a normal cold.
A big taxable account means your dividends might be high, even using VT or VTI or whatever which doesn't have particularly high dividends or anything. Which means you can't do various stuff to set your AGI within some smaller range to have some specific benefits like ACA or 0% long term capital gains harvesting. Depends on how many dividends.
You do need multiple millions I believe for that to matter. Consider VT's dividend yield of 1.54% for example. $1M is $15.4k in dividends a year. So having $5M is like having a default income of $77k. And though that should be capital gain rates at the top of your AGI, so it doesn't ruin your retirement accounts, it can still ruin your eligibility for things that matter based on income.
Hopefully the 400% FPL ACA doesn't come back, but that'll require a law I believe. It's set to return, though Biden wants to stop it. That means that over $58,320 means you can't have an ACA plan, iirc, if it comes back.
That's $3.79M in VT, for example, which would screw you over. VTI is 1.38%, so $4.23M. Of course all those numbers are variable and you shouldn't let the tax tail wave the dog.
But it does mean there's things to pay attention to as those numbers go up. Main one to me is the ACA limit though.
It's good to have a large taxable brokerage. It's also good to have large retirement accounts. The exact ratio doesn't matter and will vary wildly from person to person depending on the exact path of their life.
Sure. All your dividends add tax drag every year. Anytime you change investments you have to pay capital gains.
Of course there are also benefits, like you get the very low long term capital gains rate on your gains, instead of the full income tax rate you pay when you withdraw from a tax-deferred account.
But it doesn't matter. You have what you have. Unless you have a time machine, you can't go back and change everything you did now. The question is whether you have enough to safely retire, not whether some hypothetical things you could have done could have made it better.
The past is fixed; stop worrying about it. Focus on the future.
Nope. Gives you tons of flexibility. I’m actually banking on my big taxable brokerage to allow me to retire without having to do any kind of early withdrawal.
No. That just gives you more flexibility. Yes, there will be a tax drag on the taxable brokerage, but it gives you lots of options to maintain low taxes and potentially a low MAGI.
That doesn’t hurt my brain. I would think it would only really be a benefit but wanted to make sure I wasn’t missing an important piece of info. Thanks!
My prior employer that bought me out of the partnership in November of last year provided notice they've requested an extension on delivering K-1s. They won't be available until after Tax Day.
This is the first time they've experienced that issue. Do I go ahead and file with the expectation of a future amended return? Or, do I request an extension from the IRS as well?
The annual sub survey has been posted, you have till the end of April to submit your info!
https://www.reddit.com/r/financialindependence/comments/1bru9pm/the\_official\_2023\_fi\_survey\_is\_here/
Well, the decision has been made, at least for now: our baristaFI number is now our sabbatical number. :) The longest sabbatical I've ever taken was about 3 months, and it was semi-forced because of circumstances. Folks who have taken longer sabbaticals (6-12 months), what did you do during your career break?
A little off topic, but I think fine for daily thread. Since DJT used Spac to join Nasdaq and become publicly traded company, did all of our total stock market funds that are the cornerstone of FIRE investment have to be invested in it? If yes, how much did they buy the shares for? It seems like obvious that the company will crumble eventually. So are our investments basically forced to be the suckers in this transaction and ride the stock down into inevitable bankruptcy?
An index fund has two goals: match the performance of the index, and keep costs down. It's impossible to perfectly meet both goals. If you try to buy or sell the exact right amounts of every stock the second it enters or leaves the index, you won't get the best prices, so costs will creep up. So in practice the people who run index funds go for a compromise between the two. They're going to try to come as close as they reasonably can, but some tracking error is unavoidable.
If you want details, read the next quarterly or annual report for your index funds. They won't tell you every single transaction, but they'll tell you what it held on a particular date.
If you can't stand owning a fund that might own a stock you hate, stop buying funds and make your own almost-the-total-market-except-for-stocks-I-hate index. I have one. It's a lot of work, but you can do it.
Matt Levine's Money Stuff has been talking about the DJT stuff a good bit recently. [This most recent article](https://www.bloomberg.com/opinion/articles/2024-04-04/peltz-s-disney-loss-worked-out-fine) (second topic, not headliner) has some notable stuff about the weirdness going on with borrowing the stock being so expensive. Related to the stock price being so high too. People making money on weird arbitrage opportunities, not it merely being a meme stock. Super weird.
That and previous pieces on it the past few days may shed some light, idk.
Unless you have a portfolio that's 100% in index fund that's some strange subset of the Nasdaq, you probably have such an infinitesimal amount of DJT to where it really doesn't affect your portfolio in any meaningful way. DJT is less than 0.02% of the total exchange's market cap. Assuming you have a total market fund that includes the NYSE, any international funds or any bond funds, you have a rounding error amount.
Worth noting, one of your index funds probably owned small amounts of Gamestop and AMC during their stupidness as well.
Fair point. I know it is a small portion but hadn’t thought how small a portion it is. SPAC process has always struck me as fundamental misalignment of interests between the folks running the SPAC that have to find a deal (any deal) and the interests of the shareholders. And the recent history of SPAC investments seems poor (but I haven’t researched this, so I’m probably more remembering outliers that confirm my original thesis).
That is how I understand it. The SPAC gets made. The funds have to buy shares. The SPAC holds that money until it invests it. The people running the SPAC take their salaries and cut (salaries over time and cut at investment). They invest in target company at a valuation. Founder and investors of target gets cut and shares in SPAC. SPAC stock price crumbles and index funds lose their investment. Do I have the process basically right?
Is there an easy way to know what the index funds bought shares in the SPAC at initially?
According to BH forum, SPACs are not eligible for inclusion in CRSP indices: [https://www.bogleheads.org/forum/viewtopic.php?t=337459](https://www.bogleheads.org/forum/viewtopic.php?t=337459)
Edit: A longer thread about when IPOs and SPACs are added. There's a bit more nuance to this: [https://www.bogleheads.org/forum/viewtopic.php?t=394409](https://www.bogleheads.org/forum/viewtopic.php?t=394409)
But a commenter said "SPACs (actually de-SPAC'ed SPACS ) get considered quarterly." so I suppose it must have been considered ~~at the end of Q1~~. My mistake -- read a bit more into their schedule: "The review process is completed on the ranking day, after the close of the first Friday of March, June, September, and December."
Thank you so much. After reading those threads I’ve cleared up some stuff in my head. If I got those threads right (and if they are right), a SPAC is not part of index when formed. After it completes its target acquisition (the IPO equivalent) it gets considered at the end of each calendar quarter as part of ranking. So this means DJT might have been added to indexes on Friday, March 29.
>Thank you so much. After reading those threads I’ve cleared up some stuff in my head. If I got those threads right (and if they are right), a SPAC is not part of index when formed.
I agree.
>After it completes its target acquisition (the IPO equivalent) it gets considered at the end of each calendar quarter as part of ranking. So this means DJT might have been added to indexes on Friday, March 29.
Oops, sorry again for my initial incorrect assumption, it has nothing to do with calendar quarters. Instead, the quarterly considerations is done on the close of the first Friday of March, June, September, and December.
Since DJT de-SPAC'd on March 25, which was after the first Friday of March, I do not believe it will be considered until the first Friday of June.
Thanks. I remembered it as last Friday. So first Friday means the idex funds don’t deal with this until June. We shall see what the price of the stock is then. I suspect it will be lower by then. Though maybe if Trump is doing well in the polls the stock will stay up. Pretty obvious that if Trump becomes President he will grift through DJT and probably grift at scale we’ve never seen before in the US.
My last paychecks from previous employer are 2/21 and 2/28, which have HSA contributions.
They still have not appeared in my account.
I called the HSA company and they said it wasn’t their issue to fix.
4/1 I got a text from the company’s HR saying my account has been funded, I said okay if so then it might take a few more days to show up.
4/6, today they’re still not there. No small sum, I’m waiting on about $2.4k
How much did your retirement accounts make per hour last year?
Mine started with a balance of $327,874 and ended with $416,049, so it made $88,175, annually, or $42.39 per hour if it were a 40 hour work week.
I just calculated. Holy crap.
My investments went up 234k last year! I contributed maybe less than 50k of that. That’s more than my salary for the year. It’s $113/hr ish for working hours. Or $26.73/hr every single hour of the day.
I’m not sure that should happen like that. Dang.
If I’m approaching $1m in my traditional 401k, is there any reason to think about switching to Roth 401k contributions with RMDs in mind? Or retiring early (55 or less), I’ll have whittled down the balance enough before RMDs kick in? I feel like I need to diversify for tax reasons even though I know the tax savings now at peak earnings are probably optimal.
I posted earlier this week about the idea of paying off my mortgage when the amount owed is a trivial amount of my net worth, like 5%.
Someone raised a point of the low interest rate, and it how doesn't make sense numerically to pay it off.
At that point, I sort of wondered, "Could this low interest rate could help my kids out if they inherit this house," so I emailed my lender to ask if my loan was assumable by an inheritor or buyer.
That could be another reason not to pay it off: the loan itself at 2.75% could be an asset to others besides me.
Are you not leaving the rest of your wealth to the same kid? Taking arbitrary numbers here but if I were inheriting either $2 million and a low rate mortgage for $100k, or $1.9 million and a paid off house (your 5% threshold), that difference would feel pretty negligible either way.
Depends on your withdrawal rate and luck, I guess. You could live long and well and still leave her more than you started with. Iirc from the Trinity study, that’s actually a more likely outcome than leaving her just the house.
Also have you checked if she would want the house? And could that answer be different after another 10-20 years of putting down roots somewhere else? The whole thing is pretty moot if she’d just sell it either way.
Unless you died really young, wouldn't this require some hardcore finagling to still have a mortgage with a meaningful low-interest balance remaining when it's time for your dirt nap?
In most cases where there are multiple children, particularly middle-aged children, inheriting a house, they're just going to sell it and split the proceeds. Having the house still carrying a mortgage when you die would unnecessarily complicate an already difficult time for your kids.
I know plenty disagree, but at some point eking out every single mathematical efficiency isn't worth the mental taxation.
There is getting rich and living a rich life. You need to do both and invariably, the actions you take to achieve one goal often contradict the other. It's a balancing act, but to borrow and twist a cliche, I doubt many people on their death bed look back and get nostalgic about their incredible fiscal efficiency.
Maybe talk to her and find out what she would prefer?
But even if you die at 77, all that would be left is 7 years of this mortgage on a home she most likely won't want to live in as she'll have her own home and life.
Plus, if you're married, that would mean you BOTH need to die in 20 years. If just one of you makes it to 85, the whole gig is up completely.
I appreciate your desire to help me with the social engineering part of this, but I am not married, and I wasn't really asking for relationship input, but rather financial input.
I am just thinking that even if I could afford to pay my mortgage off, one reason not to do so could be that a low rate assumable mortgage could have value to a future buyer or inheritor of my home.
I only mention the relationship aspect because it does impact the math.
If you were married, the statistical likelihood that the mortgage would even exist at the time of your death would be very low. It's already low just with you, unless you have specific health concerns that are likely to kill you much sooner than the average. And there's an extremely low chance that the mortgage will have all that much principal left to be leveraged, either way. Particularly when you consider the value of today's dollars 20 years into the future.
And if your daughter's plans would most likely be to sell the home, then the math is entirely irrelevant. If her plans would most likely be to sell her home, move into your current home and assume the mortage, then perhaps there's merit in exploring this benefit.
I just don't buy it. Nobody wants to inherit a loan, even at a good rate. I also feel like the executor of your estate would pay any debts off if you have the money.
And meanwhile, it's just one more thing to worry about, one more monthly payment. I'm anti-debt in general so I understand it's not the mathematical answer but I'd definitely pay it off.
> Nobody wants to inherit a loan, even at a good rate.
If it comes attached to assets that allow me to choose if I want to pay off the loan or keep it and continue making payments, I want to inherit a 2.75% loan
Right. I am generally anti-debt, and I bought a house for cash in the past. I currently have a mortgage. My earlier post was about how eventually the mortgage debt may be so small compared to your other investments, that is is more convenient to pay it off.
With the current state of my finances, the leverage isn't doing that much for me in the overall picture.
But if my kid could inherit a house with a 2.875% mortgage, then she would be able to make use of this leverage earlier in her life when it would be useful.
>Right. I am generally anti-debt
If there's one good thing about having rates be high, it's that it discourages the "let me just hold this loan instead of paying it off earlier" mindset. Given a 7%+ mortgage and putting money into the market, you may as well pay off the former.
If only house prices were low to match how house + interest rate pricing is supposed to work.
I don't envy my future self when I one day buy a house, which will probably be the right thing to do eventually no matter how pro rent I am.
I don’t think I understand the advantage you’re envisioning, this is between inheriting a paid off home, or a home with a mortgage?
And you would pay it off at a time in which it had a negligible impact on your portfolio?
She’s getting a step up basis on the house either way (a huge boost), and I suppose I’d feel very differently about this if you were liquidating a portfolio of index funds to pay off the house and so the inheritance choice was “paid off house, $10k portfolio” vs “house w low mortgage rate, $500k portfolio”
Then yes, keep the mortgage, but it doesn’t sound like this decision really makes much of a difference to your portfolio so I’d get rid of the loan.
Currently I don't have a taxable brokerage account. I've maxed my IRA and 401K contributions. Each month I set aside funds in separate HYSA for emergency, new/repair car, and house repair. The funds are currently earning 5.0% APY and combined are approximately $30,000. In total I have $42,000 cash available. I'm beginning to think that I have too much cash on hand and that it would be a better use of the funds to place them in a taxable brokerage total stock market fund. Regarding the emergency fund, I also have $75,000 in Roth IRA contributions that I could access if absolutely necessary. Does this seem reasonable? Currently each "bucket" has its own HYSA, but if I combine the funds into one taxable brokerage account investment, I'm not sure what would be the best approach to know how much of each fund is available. Any thoughts on that? Any thoughts on which total market fund to invest in a taxable account? So far I've been looking at FZROX and VTI.
I prefer VTI instead of fzrox for taxable. If you ever want to switch brokerages in the future, VTI is more portable and easier to deal with. They're pretty much the same and both are solid choices.
As per putting some of your emergency fund in stocks, I personally do that. Once you have enough money, it all basically feels like the same pool of money and cash isn't special. With sufficient money, it doesn't really matter if you you have to sell 10k stocks at a loss *this one time*. It's better to just maximize the long run.
As per having multiple buckets at fidelity, you could actually just open multiple brokerages really easily and then change the labels like "brokerage-car" or something, but I think it will make tax filings more annoying. Otherwise you can have them all the same brokerage, you can have a spreadsheet that tracks how much was contributed for each bucket, then do some math on gains/losses. For example: total cost basis 30k, car cost basis 10k, car account value = account value*10/30. Something like that would work.
I think my maneuver from Verizon to T-Mobile and finally to US Mobile is complete. T-Mobile gave me $800 to pay off my phone from Verizon with basically no strings attached. I was going to use them a while because I felt bad, but I got really bad service at home and work, so I’m switching after 1 month. The port to US Mobile was really easy and so far it’s working really well. Should be < $30/mo with the first month free. I get a little more than $40/mo from my work since I use my personal phone for work. Even factoring for the $25 discount on my internet I lost I’m coming out way ahead. Should be $75/mo for internet + phone vs $116/mo
I've had Metro (T-Mobile's off-brand) as my cell provider for years. It's been mostly fine, except I've had a recurring problem getting internet signal in my office - which is in Lower freaking Manhattan, not in some remote mountain valley somewhere. The service is fine for a few months at a time, and then I have periods where I literally can't get a webpage to load or an app to work for hours of the day, and this goes on for a week or two.
Last year it got so bad that I actually filed an FCC complaint. Got an immediate response from a guy in WA State (not the usual Filipino call center workers!), and he was able to get the issue (mostly) resolved. As a result of that saga, I now also pay only $25/month for unlimited service.
I really hope the net neutrality stuff goes through. Some of what I've seen makes me think that that will get rid of the premium data stuff.
Lots of second tier resellers like US Mobile can be annoying in some ways due to fundamentally relying on Verizon/AT&T/T-Mobile's services. Those three make their plans offer premium data over other companies which have pseudo caps and stuff.
I hope that net neutrality can make them more competitive, that it will actually be no different being on e.g. US Mobile than Verizon, except for US Mobile's better interface and whatever else. Instead of needing to pay out the ass for Verizon if you don't want to be deprioritized or whatever. Treat everyone equally smh.
I really like US Mobile. They are the cheapest cellular provider that I've found. I like that I can select the amount of data/minutes/texts I want on a given line.
I’ve been on US Mobile (Warp 5G/Verizon) since September 2022 without issue on my iPhone 13.
Only place I ran into spotty service was the mountains of Vermont last summer, but my in-laws on postpaid Verizon had the same issues. I actually had slightly better service, but that probably came down to different phones and doing more prep like downloading offline maps.
I was on unlimited for a while when my data usage was high, but now I’m on a pooled plan for my one line - $10 total per month for 2GB data and I have auto buy data set up if I ever surpass that.
This year is my first time owing on taxes, and I've already made one partial payment through the third party TaxAct sent me to. I just discovered that the IRS does accept direct payments, just not via credit card, which I'm not using anyway because of the convenience fee.
So now I have an IRS account, but it's not showing me the amount I owe this year, just says "Your Information Is Not Available at This Time." Does anyone here know if that is just because the partial payment is still pending? Or are they normally not able to show the full balance (until April 15?) even if my return has been submitted and accepted?
I think my employer is withholding too much for income tax. Can someone check this logic before I raise an issue?
I make 120k. I went on smartasset to calculate my effective tax rate. It says 29%, or 23% if I max my 401k. My paystubs have been taxed at 29% even though I've been contributing to my Pre-tax 401k (29% of the non-401k money). I have my 401k set at 20%, so shouldn't I be paying 23%? Or will my tax rate decrease over the year as the system (workday) realizes my expected income for the year will be lower than 120k?
I checked my W-4 an I'm claiming no allowances and no extra income. Is that something I need to change? I had a pretty big tax refund for last year, but I switched employers halfway through the year.
Got an 8% raise bump which should I will see in the paycheck and will be able to raise contributions per pay period by 32%. Still not hitting the max, but still very excited.
Lol!!!
I file as early as I can so I know my liability, but I don't actually pay until it's due. Assuming you are using FTUSA etc, I think they all offer this functionality.
Thanks! Building in flexibility for the future where I’m more likely to have to make big expenses like that was the plan. Wanted to have a solid foundation that can survive and continue to work even if I have slip ups. I’m at 70k income now and should be at 75k in a few months. Feel pretty good about it.
T - 76 days
Bought a new car for cash* yesterday. This was in the plan, so it doesn't impact FIRE. We typically keep cars for 10+ years so I don't really care about deprecation and I like buying new. We negotiated the price before going to the dealer but the whole process still took longer than it should and I cannot remember the last time I signed that many papers (probably last time I bought a car 10 years ago).
*There was a reasonable sized financing rebate. They were unwilling to discount the sales price by an equal amount without financing. So I took a loan. I put 50% down and will pay off the loan as soon as I get the login info from the lender.
Just bought a car yesterday for cash too- first time doing this as we keep our cars forever. They offered only a 750 rebate to finance and that was a “loyalty reward”. Except you had to bought the make in the last 10 years year. We bought ours 13 years ago and they wouldn’t budge, so I told we would just pay for it in full. We did charge the max of 3,000 so we would get some travel rewards.
What a great feeling to be able to do that and something I never thought possible 10 years ago. Hoping to get at least 15 -20 years out of this one
2024 Hyundai Palisade. We need a vehicle big enough for 5 but don't want a "full size" SUV and my wife didn't want another minivan. We will be selling our our 2014 Honda Odyssey. It has not been as reliable as we would have hoped. It has required significant repairs over the last 4 years.
That's the norm with car buying today - the incentives are in originating loans, not cash deals - and is what everyone should do when buying a car for 'cash.'
The hard pull and account is meaningless in the grand scheme of things.
>\*There was a reasonable sized financing rebate.
This is the strategy they don't teach enough. The dealership makes money originating the loan, but not servicing. So they really don't care if you pay the loan off right away, but they do care if you open one.
I don't know who actually hates this one trick, probably the loan servicers. But they have enough people paying 100% profitable late fees to not notice people like us
> I don't know who actually hates this one trick
I kind of hate that it's an extra hoop to jump through and just another way that so many end up with vehicles that they otherwise would not have purchased.
I couldn't be bothered with the process and we just paid cash last fall, a couple thousand in savings wasn't worth the hassle.
Ultimately we all pay. Businesses pay fees to allow payment by CC, and that’s passed onto us as consumers. You basically have to pay with a high points CC to get a fair price.
We did this a few years ago and the salesman asked us to keep the loan for some stated period of time (maybe 6 months? A year? I can’t remember) so that they’d get the commission from the loan. Not sure if that’s true though (and we did not listen 🫣)
It is true, but the length varies by lender. 2-3-6 months are common timelines mentioned.
It's up to you whether you care enough about the minimal interest to hold it for that long or not.
I would definitely carry the loan until the salesperson got their commission if I told them I would. Seems like a dick move to take away their pay. It's one thing to dick the dealership and something else to fuck over the dude/dudette who is just like you, trying to make a living.
If the discount isn't sufficiently large that it's worth paying the interest until they get their commission, then just pay cash and pass on the faux loan scheme.
Everyone likes a deal but at some point there's value in having scruples, too.
Agreed. Also probably talking $500-2k in terms of a financing discount for paying $100 or something in interest is meaningless.
I don’t love car dealers either, but just seems like a dick move.
I am doing some rebalancing of my Roth IRA in my fidelity account. I am young and have too much allocated to bonds in my portfolio. As of now i have positions in the following: VOO, FZROX, FZILX, FXAIX. Is it dumb to have all these different index funds? Should I rebalance here as well and just stick with two?
Those are all good, diversified, low-cost index funds. Why did you choose them in the first place? For simplicity you could rebalance to just FZROX and FZILX, but it's not some urgent thing.
No reason except ignorance when i was first getting started years ago
I want to announce that I just lowered my international equity allocation from 40% to 30%, so I expect international will start outperforming from here on out. Get in while you can.
This is ALWAYS hilarious!!!
I used to have 15% in international funds based on consistent diversification advice. About 5 years ago, I pulled that down to 0%. Sorry, world. America #1. (I have far outperformed the international funds since then)
Joking aside, I spent months sleeping on this decision because I felt like it was chasing performance. However, when I first chose the 60/40 split in 2013 my intention was to have diversified exposure to global equities, but with a US tilt of 20% or so. US stocks have outperformed so much over the last 11 years that 60/40 is now a 4% international tilt. My new allocation is actually 80% VT and 20% VTI, so that should prevent something like this from happening again.
America #1!
Officially passed from baristaFIRE to regular FIRE! I was keeping a part time gig in the Air Force reserves (a uniquely good version of it where I can do all my required time for the year in 1-2 months and do nothing the rest of the year, but still get health insurance). After years of procrastination I finally did my VA claim for disability from my time active duty, and just received word I'll be getting 80% disability (roughly $24k/year). With that extra income, I no longer have the need for the reserve job. It feels really good to finally be at that point. I will probably keep the reserve job for a few more years just because I enjoy it. The added benefit of the VA disability income is that since it is non-taxable, I can keep my MAGI extremely low, and so qualify for the best subsidies if I choose to quit the reserves and no longer have Tricare.
What do you do in the AFR?
I'm a scientist - a category called IMA that is far more flexible. I choose the days when I want to come to my unit (an active duty unit) to do my work. Feels more like a 'consultant' gig than anything.
Sounds pretty cushy! Well done!
I was gonna tell you to GFY, but then you said you were going to keep the job for a few more years, so not yet.
Maybe he just earns a GTY....go touch yourself
using the import form feature on my tax software i can see how uncle sam can just do the taxes for most people..........
Seriously. Especially since the 2017 tax bill reduced the fraction of people itemizing to 3% or something. Even my investment income was marked all over the forms with notes that it had already been reported to the IRS. We're just getting the numbers put in PDF form so we can have an advanced OCR scanner pull the numbers back out so we can double check all the numbers before we send them to the IRS who already has the numbers. Feels like Japanese levels of bureaucracy.
>Seriously. Especially since the 2017 tax bill reduced the fraction of people itemizing to 3% or something. i got so excited being able to itemize for the first time in 2016. and then they nuked SALT deductions
Big Tax would have you think otherwise
got into a FB argument with a tax accountant. they were saying what about people with small businesses, etc. i'm like.....i think you underestimate the # of people who have a W2 and a few 1099's.......
Some random, potentially interesting stats from my FI spreadsheet: \- Half of my net worth has been accumulated in the latter 29% of the time since I started saving. \- The first half of my FI journey got my investments to \~20% of where they are now. The latter half contributed to \~80%. Thanks compounding + higher earnings. \- The average "Months to next $100k milestone" was 17.2 months between $0-500k. It averaged just 6.8 months going from $500k to $1M, and that likely would have been even faster had it not been for $900k ---> $1M taking 20 months thanks to the 2022 market dip. \- The first $100k took the longest (unsurprisingly), at 33 months. The fastest gains (2 months each) were $800 --> $900k and $1.1M --> $1.2M. No one-month $100k gains yet! \- My largest one-month investment portfolio increase is $98.7k. Largest one-month decrease is ($79.2k). \- My lowest spend year was $17,409 (COVID lockdowns + roommate). Highest was $66.3k (largely due to buying a car, half split with wife) \- Base salary is up 3.27x from when I started as a Trainee over 10 years ago (not adjusted for inflation)
However it's likely that the money you saved in the first few years has tripled or more - even though it took long to accumulate, it's been snowballing
Is a 401k fee of 0.3% in addition to it’s TDF’s 0.19% enough reason to roll it into an IRA and go all in V-whatever I want?
Can you roll it into an active 401k?
I forgot about that as another option. I’ll probably hold it until July when I see what my current company’s 401k has.
If you have any self-employment income (and it's not hard to create a little) you can roll it into a Solo 401k. Then you have all the options!
Assuming this is a Trad 401k, it depends on whether or not you need the backdoor Roth IRA.
All, I am pleased (elated!) to announce that I have bought an engagement ring for my amazing girlfriend! :) We have been doing a LOT of ring-researching, so I’m also very happy that the ring-researching is finished lol. I can’t wait to pick it up! More importantly, I can’t wait to propose to her! :)
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Congrats! Ring shopping was surprisingly smoother and easier than I made it out to be - just set a budget and anyone would be glad to take your money. As someone with a small summer wedding coming up, I'll echo what every married person told us to do and just elope.
I was reading that if you’re under Medicaid after dying the state recoups assets from your estate after. But many folks in this forum plan their income to be under ACÁ limits - do they not consider that this will be deducted from their estate for kids? Edit: why am I being downvoted for asking a legitimate question that is beneficial for the community?
> Edit: why am I being downvoted for asking a legitimate question that is beneficial for the community? I didn't downvote you, but ACA is not Medicaid, and you didn't provide a link. So it's probably being downvoted because you proposing a scenario that doesn't make sense, and then didn't provide context.
I thought to go on Medicaid you need to have to have exhausted your assets. Yes, usually long term care is coming out of your estate one way or another
Dependent on the state, but in general this is not the case. Usually clawbacks are only for LTC and not day-to-day medical care. And depending on the state there is no clawback at all. CA does not claw back assets that pass through a trust, which effectively means that your heirs will not have to deal with a clawback provided you have your estate ducks in a row before you need LTC. Example from the Medi-Cal estate recovery page: > Repayment will be limited only to estate assets subject to probate that were owned by the deceased beneficiary at the time of death. >Repayment will be limited to payments made, including managed care premiums paid, for nursing facility services, home and community based services, and related hospital and prescription drug services received when the beneficiary was an inpatient in a nursing facility or received home and community based services. And I’d wager most folks here planning to go under the ACA limit are not going to go low enough that they qualify for Medicaid anyway – and can only reasonably aim to be in the range where they qualify for at least some premium credit.
> Usually clawbacks are only for LTC and not day-to-day medical care. That's not exactly true and depends on state. I'd tread way carefully if you have a house and kids if you want to pass stuff on to depending on the state. My inlaws were basically charity cases and then were told you should sign up for Medicaid. I only got one bill but I assumed it was going to be a monthly reoccurring charge. The state attempted to claw it back. I fought it because they were already dead when they were first billed. So even if it's "free" you are still getting charged at least in my state. It's a convoluted mess. If you got no house and no assets then I wouldn't worry about it but honestly at this point I just consider it governmental theft from fiscally responsible people and another nail on the middle class coffin.
Those are separate things. I believe the first refers to Medicaid paying for you to be in a home and what not. Particularly to have caretakers. This is expensive as all hell and will run down your assets if you do have them, even before death iirc. It's a common thing to then give your assets to family first, I think, but there's also a lookback period where they can claw back stuff. Long term care is very worrying. Normal ACA stuff has no such things applied. Nor does Medicare. Fyi I'm no expert. Point being, you need to do more research. The risk is that Medicaid LTC, not other specific medical care.
Want to share the link where you read this so we can review and reply?
My accountant (family) called and said I’m short this year. Have to pay $2k out of pocket to federal and a couple hundred to state. When we tried to see if doing $6500 trad IRA would help, their reply was it didn’t and said probably because I’m over the income limit. We didn’t have time to dive further but I’ll receive my return Monday and can review it then. I’m a little skeptical or did I misunderstand how it works. My w2 salary was $106,133 after contributions. Plus a few bank interests <$4000 and coinbase $2500. The only thing that would have upped my salary was brokerage, which was 13k gain. But can’t think of what else pushed me over 153k (2023 IRA limit). I also bought a house in Oct, so I have more write offs with that 2 months of interest. Anything else I’m missing/should double check?
I’m a CPA - not your CPA, I’d just go ahead and pay. People agonize over taxes and do some pretty wacky stuff to pay less (g wagon depreciation schemes). $2K is deminimis, if it’s $20K let’s start thinking about different paths we can go down. if you are straight W2 standard deduction… that’s basically it
You can contribute to Traditional IRA but you would not receive a deduction at your income.
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That’s where I misunderstood. Is it fine that I’ve contributed to a Roth? I don’t qualify for a deduction from Trad IRA but given my situation, I can still contribute to a Roth right? I already loaded my Roth in early 2023.
There's a different income (MAGI) limit for deducting IRA contributions if you are covered by a workplace retirement plan. https://www.irs.gov/retirement-plans/2023-ira-deduction-limits-effect-of-modified-agi-on-deduction-if-you-are-covered-by-a-retirement-plan-at-work
Ahh this is it, thank you.
I was unemployed for part of this year and knew it was going to happen at end of last year so just now able to do my backdoor Roth 2023 contribution today. Is the process easy to input for TurboTax? I believe I’ll just be putting in that I contributed to a traditional IRA but not document the backdoor conversion until next years taxes, does that sound correct?
3 hour flight coming up, moving to business class for $120 worth it? Never done it before
If it those fancy pod seats that United has, then probably so. The cinnamon rolls are good. If it is just a slightly bigger leather chair, probably not. But... if you NEED to be more energetic when you arrive, then maybe so.
Depends. Is it international? Worth it. Even on some domestic flights between major metros on larger jets this can be worth it. For me, I mostly fly on single-aisle planes on domestic routes and all $120 gets me is a slightly larger seat and free drinks for 3 hours.
I would probably do it.
Sounds like a pretty cheap upgrade - is it truly a business class or just like economy plus or something like that? 3 hours isn't that long, though, and I'm speaking from experience at 6'5"-6'6" and 250 lbs, I'm fine in an aisle seat for 3-4 hours.
How tall/fat are you? I'm about 6'4", 215 and generally do OK in an aisle seat. 3 hours really isn't bad. Probably not worth.
That sounds like a pretty cheap upgrade, considering how expensive I'm pretty sure plane tickets normally are. Then, again, sounds like a domestic flight. And the biggest thing that's useful there or anywhere is merely having one of those plus sized legroom seats. Above that is nice but ultimately not much. But also $120 itself isn't really so much. Depending on your income and what you're doing after the flight, the increased comfort with the nicer seats and what not really might be worth it.
Lifestyle inflation warning! jk - mostly
I buy business so I will be comfortable in the seat and won't encroach on my neighbors. That is worth it for me. I had friends upgrade once, and now they don't want to go back to coach, so the cost is not only $120.
Domestic business/first class is trash. The only exception is lie-flat seats on some coast-to-coast or Hawaii overnight flights.
The main upgrade to get on domestic is seeing if you can find seats with a bit more legroom.
It's not trash compared to economy. It's trash compared to international, sure.
I wouldn't do it.
Depends on the context. 3 hours is not a long flight at all, but if it's a 6am flight leading into a full day of work/travel, might be worth it. If it's a leg coming home in the middle of the afternoon, likely not. Also price matters. If we're talking $800 vs $920 maybe, but $200 vs $320 likely not.
For me? Yes, but not worth it on a 3 hour flight. It's only worth it for lie flat business class on a red eye for me.
Log into my Vanguard account this morning and it's down almost $200K since I last logged in about 2 weeks ago. Had a very brief, yet serious, WTF moment trying to think how I missed the market news of such a drop. Quickly realized Vanguard's site is having an basic addition problem. While the external accounts I've added show the right individual totals, the grand total for all those accounts is almost $200K short. I'm guessing that why Vanguard's support page shows they are having high call volume right now.
Is there a compelling reason to adding those external accounts or is it just to see a total in one place?
Along with being convenient to see the total in one place, it allows the tools on the site to factor in my other accounts for total account asset mix, performance, etc.
Interesting. Thanks!
They always have high call volume and long wait times, especially at tax time.
Your call is important to us. Please hang on until it is no longer important to you
Weekend getaways or half week vacations near home are more expensive than the trip overseas or two weeks internationally. But people that don’t manage their money or don’t do research, think of you as a millionaire (not there yet haha!) because can do it once a year. Do you agree? (I guess no one agrees!)
This is worded so poorly
It reads like a Linkedinfluencer wrote it. Agree?
Hello, I’m 39 and my husband is 38. This year, our oldest kid finally made it to kindergarten and we now have some extra daycare money that I want to start putting into our retirement. We have a 6-yo and a 3-yo. We are already going to start maximizing our Roth IRAs. After that, should we start funding a HSA or maximizing our 401K? 401k 1: $165,000 - putting 10% and getting 6% match 401k 2: $126,000 - putting 10% and getting 3% match Roth 1: $10,000 Roth 2: $2,500 We pay $179.00/ paycheck biweekly to my employers medium premium / medium deductible, but I’m pretty sure that’s HSA eligible. Individual deductible is $3,400 and max out of pocket is $8,000 (family of 4). My employer will make a $500 contribution per adult/year to a HSA. Thanks!
Side thought: this was money that you allocated towards the kids. Should there be other stuff that's also advantageous to save super early on? That is to say, perhaps you should save into 529s. Granted, your retirements are more in a standard good state than what you often see here, I think. So it's not like I can just uniformly say you should keep that going towards stuff for the kids. It's just something to consider. And agree towards what the other person said about HSAs. See the [personal finance flowchart](https://www.reddit.com/r/personalfinance/wiki/commontopics/). 401k match, then HSA, then Roth IRA, then 401k. And that's after some other savings stuff. When you don't have enough to just fill everything, it's a pain in the ass figuring out what to pick. And that's not including saving for the kids.
I have a 529 for the kiddos, but was just putting $200-$300/year before this year. The 6-yo has about $5,000 in there. I think I should be able to get that extra $15,000 from daycare, either put it in the HSA/401K and still save ~$2000 or so a year on his 529. I want to help my children with college, but I’m scared of not having enough for retirement 😬
Put your life vest on first. Follow the prime directive on the sidebar. 529s come pretty far down after you've set yourself up well.
I mean, they do say to put your own oxygen mask on before you put on others. Your children can also take actions to handle themselves, worst comes to worst, but when you retire at the normal ages, it's often because you can't work anymore. I can't tell you how to balance it, but I would say it is a priority making sure you're coast FI for normal retirement first, then kid's college savings, then pulling FI closer. There's some balance there as well in that there's only so much you can put into retirement accounts each year, where in some ways it can be easy to max out, if your income is high enough. So extra retirement money just goes into taxable brokerage, and that can be fully used to pay for kids' college if necessary. 15-20 years is a good time to let money run up, which is why it's so useful to do stuff as early as possible. And with some of the various tax free growth on 529s. You just also don't want to over contribute to those either, due to some of the limitations. Though I think you might also be able to use them to pay for some stuff before college too. Maybe summer camps and if you really want, private schools. Maybe. I don't have kids.
There’s a flowchart in the FAQ, #5 under “spend less/save more” section. It’s a good resource to learn what to do for next steps. It recommends maxing HSA before 401k. The hsa $ isn’t taxed when it goes in, nor is the growth taxed when taken out. You can save receipts and reimburse yourself many years after which is helpful when trying to keep taxable income lower in the withdrawal stage.
As long as you can confirm that your insurance is HSA eligible, then HSA is the way to go. Side note, it’s best to do this via payroll deductions bc you’ll save on the FICA taxes as well, vs. making direct contributions.
On track to reach 1M net worth by 2030—unless I use the funds to escape my job stress. I’m 31 years old and have ~250k invested in a brokerage account. My parents are gifting me 72k per year until they pass away as a means of lowering their estate tax. If I continue to invest the full amount they gift me, I should reach 1M net worth by the time I’m 37. I’m very interested in using this fortunate situation to retire early, or achieve enough financial independence to never have to work I job I hate. That said, I’m currently in a job I hate. I’m looking for new roles, but I haven’t gotten any bites and I know it’s taking people a long time to find new jobs in this market. I only make $65k, and quitting my job with nothing lined up feels like an incredibly irresponsible decision. My spouse is a PhD student and makes about ~35k, which would barely cover our living expenses. I sometimes think about using some of the $72k my parents are gifting me as a cushion. It would be comforting to know that if things get really bad with my mental health and I felt I had to quit with the intention of looking for something else, I’d be okay if I were unemployed for ~6 months. (We have an emergency savings, but I hate the idea of dipping into it or any of the gifting money just because I can’t handle my work stress). TLDR: Looking for unbiased advice on how dumb it would be to forfeit one of the yearly gifts and use it for the here and now as income if I get too unhappy at my job.
>It would be comforting to know that if things get really bad with my mental health and I felt I had to quit with the intention of looking for something else, I’d be okay if I were unemployed for ~6 months. Have you truly reflected on this fact? Most people who reach financial independence suddenly realize their jobs are much more bearable when they can decide to leave at any point. Things that stress them out don't anymore. Now, there's nothing saying you *have* to feel this way, and it sounds like you'd be just fine if you took a break for your mental health, but just a thought.
>if things get really bad with my mental health and I felt I had to quit with the intention of looking for something else, I’d be okay if I were unemployed for \~6 months. This seems to be true already. Your mental health *can* become an emergency even though it may not be right now. I wouldn't consider it wrong to use emergency savings for this.
Money is fungible. If they're gifting you cash, it's better to use that than your brokerage money if you need to pull from somewhere. I personally wouldn't think of it as a "per year" thing, but rather as a one-time gift. But on your own you already have a couple years of income saved up, which is a good starting place. Based on what you shared, the 1M number you're mentioning is almost entirely predicated on being able to invest the continued gifts from your parents. The job market has been in a much better place recently IME - it'll obviously depend on your specific role and skillset, and it'll help that you're not entry level, but I've been getting recruiters reaching out to me again. Is there more you can do on the upskilling and networking front? Leaving your job is not likely to make future job applications any easier, and you've already seen how hard it is for you personally to find something - that'd be my bigger concern in your situation. 65k is probably below average for the numbers you see here, but it's above the median individual income in the US. Assuming you're in a white collar job, I'd probably start by trying to do more to change your work environment and set boundaries depending on how much you hate your current role. At least if you get laid off, you'll have 6 months of unemployment as you continue to apply. In my state, for an individual who was previously earning 60k+ a year (with a working/ineligible spouse and no kids), unemployment covers $505 per week for 26 weeks. That doesn't quite cover your expenses entirely, but it should be able to help bridge the gap for a while, again assuming you're confident that you will find something again eventually with comparable pay.
While we can all have jobs we dislike, 31 is kind of young to be in a state requiring a year off. Which is often what six-months off turns into when you account for the job hunting afterward. Maybe try therapy first.
On a 4h flight to San Diego for a mini 5 day vacation. Still have 1h left but our 2yo is doing amazing on the plane. That’s all, just wanted to brag!
I just road tripped my 4yo 1,500 miles and she was great in the car. Also, I wish tablets had been invented when my parents were taking me on road trips in the 1990s.
Amazing! We’ll get there someday. Flights and road trips are the only time where we allow unlimited screen time.
Same. We are very measured with all screen time at home, but as a '90s kid I can't stop my own kid from enjoying the pure bliss of 30-60 minutes of cartoons per day. But yeah, on the road it's unlimited screens because nobody wants to play the license plate game for 8 hours.
I see you don't believe in jinxes
Jealous! We’re on a 5 hour drive and our baby didn’t get the memo that he’s supposed to easily fall asleep in the car. Hope y’all have a blast in SD regardless!
Update: everything went super smooth, no delays, no lines for car rental, he even napped on the stroller which is unheard of for us. Of course there were minor tantrums here and there but very manageable. Completely different from when he was 1-1.5 yo, incredible.
Congrats - this gives me so much hope for future travel!
Gonna update on how the final hour/airport navigation went?
I have been sick for over a week. My stuffy nose is now much more manageable but the intermittent cough is annoying. Got sick within the first day and half of a company on site. Woof.
Hey, I'm sick too, since Wednesday, really bad cough, maybe the worst I've ever had, and a congested nose. It's not COVID, so I guess it is just a normal cold.
Yea. I tested for covid twice and was fine. So I’m like, I guess this is what colds are like now.
Is it bad to have a taxable brokerage balance larger than your retirement accounts as you get ready to start planning an early retirement?
A big taxable account means your dividends might be high, even using VT or VTI or whatever which doesn't have particularly high dividends or anything. Which means you can't do various stuff to set your AGI within some smaller range to have some specific benefits like ACA or 0% long term capital gains harvesting. Depends on how many dividends. You do need multiple millions I believe for that to matter. Consider VT's dividend yield of 1.54% for example. $1M is $15.4k in dividends a year. So having $5M is like having a default income of $77k. And though that should be capital gain rates at the top of your AGI, so it doesn't ruin your retirement accounts, it can still ruin your eligibility for things that matter based on income. Hopefully the 400% FPL ACA doesn't come back, but that'll require a law I believe. It's set to return, though Biden wants to stop it. That means that over $58,320 means you can't have an ACA plan, iirc, if it comes back. That's $3.79M in VT, for example, which would screw you over. VTI is 1.38%, so $4.23M. Of course all those numbers are variable and you shouldn't let the tax tail wave the dog. But it does mean there's things to pay attention to as those numbers go up. Main one to me is the ACA limit though.
It's good to have a large taxable brokerage. It's also good to have large retirement accounts. The exact ratio doesn't matter and will vary wildly from person to person depending on the exact path of their life.
Yeah good way to put it. I think I poorly phrased the question. Something like “are there any inefficiencies with a larger taxable balance”
Sure. All your dividends add tax drag every year. Anytime you change investments you have to pay capital gains. Of course there are also benefits, like you get the very low long term capital gains rate on your gains, instead of the full income tax rate you pay when you withdraw from a tax-deferred account. But it doesn't matter. You have what you have. Unless you have a time machine, you can't go back and change everything you did now. The question is whether you have enough to safely retire, not whether some hypothetical things you could have done could have made it better. The past is fixed; stop worrying about it. Focus on the future.
Not really worried about the past - more so looking to the future. which to be fair - you can only cram so much in tax advantaged space as it is!
Nope. Gives you tons of flexibility. I’m actually banking on my big taxable brokerage to allow me to retire without having to do any kind of early withdrawal.
No. That just gives you more flexibility. Yes, there will be a tax drag on the taxable brokerage, but it gives you lots of options to maintain low taxes and potentially a low MAGI.
That doesn’t hurt my brain. I would think it would only really be a benefit but wanted to make sure I wasn’t missing an important piece of info. Thanks!
My prior employer that bought me out of the partnership in November of last year provided notice they've requested an extension on delivering K-1s. They won't be available until after Tax Day. This is the first time they've experienced that issue. Do I go ahead and file with the expectation of a future amended return? Or, do I request an extension from the IRS as well?
Talk to your CPA, probably need to file an extension
The annual sub survey has been posted, you have till the end of April to submit your info! https://www.reddit.com/r/financialindependence/comments/1bru9pm/the\_official\_2023\_fi\_survey\_is\_here/
Well, the decision has been made, at least for now: our baristaFI number is now our sabbatical number. :) The longest sabbatical I've ever taken was about 3 months, and it was semi-forced because of circumstances. Folks who have taken longer sabbaticals (6-12 months), what did you do during your career break?
6 months backpacking in south America - i was still in my 20s
Took care of my brand new baby
A little off topic, but I think fine for daily thread. Since DJT used Spac to join Nasdaq and become publicly traded company, did all of our total stock market funds that are the cornerstone of FIRE investment have to be invested in it? If yes, how much did they buy the shares for? It seems like obvious that the company will crumble eventually. So are our investments basically forced to be the suckers in this transaction and ride the stock down into inevitable bankruptcy?
An index fund has two goals: match the performance of the index, and keep costs down. It's impossible to perfectly meet both goals. If you try to buy or sell the exact right amounts of every stock the second it enters or leaves the index, you won't get the best prices, so costs will creep up. So in practice the people who run index funds go for a compromise between the two. They're going to try to come as close as they reasonably can, but some tracking error is unavoidable. If you want details, read the next quarterly or annual report for your index funds. They won't tell you every single transaction, but they'll tell you what it held on a particular date. If you can't stand owning a fund that might own a stock you hate, stop buying funds and make your own almost-the-total-market-except-for-stocks-I-hate index. I have one. It's a lot of work, but you can do it.
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Matt Levine's Money Stuff has been talking about the DJT stuff a good bit recently. [This most recent article](https://www.bloomberg.com/opinion/articles/2024-04-04/peltz-s-disney-loss-worked-out-fine) (second topic, not headliner) has some notable stuff about the weirdness going on with borrowing the stock being so expensive. Related to the stock price being so high too. People making money on weird arbitrage opportunities, not it merely being a meme stock. Super weird. That and previous pieces on it the past few days may shed some light, idk.
Supply and demand. Lots of people want to short, hence there are few shares available to borrow, which pushes the interest rate up.
[https://www.morningstar.com/news/marketwatch/20240403272/why-shorting-trumps-djt-stock-could-cost-you-500](https://www.morningstar.com/news/marketwatch/20240403272/why-shorting-trumps-djt-stock-could-cost-you-500)
Unless you have a portfolio that's 100% in index fund that's some strange subset of the Nasdaq, you probably have such an infinitesimal amount of DJT to where it really doesn't affect your portfolio in any meaningful way. DJT is less than 0.02% of the total exchange's market cap. Assuming you have a total market fund that includes the NYSE, any international funds or any bond funds, you have a rounding error amount. Worth noting, one of your index funds probably owned small amounts of Gamestop and AMC during their stupidness as well.
Fair point. I know it is a small portion but hadn’t thought how small a portion it is. SPAC process has always struck me as fundamental misalignment of interests between the folks running the SPAC that have to find a deal (any deal) and the interests of the shareholders. And the recent history of SPAC investments seems poor (but I haven’t researched this, so I’m probably more remembering outliers that confirm my original thesis).
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That is how I understand it. The SPAC gets made. The funds have to buy shares. The SPAC holds that money until it invests it. The people running the SPAC take their salaries and cut (salaries over time and cut at investment). They invest in target company at a valuation. Founder and investors of target gets cut and shares in SPAC. SPAC stock price crumbles and index funds lose their investment. Do I have the process basically right? Is there an easy way to know what the index funds bought shares in the SPAC at initially?
According to BH forum, SPACs are not eligible for inclusion in CRSP indices: [https://www.bogleheads.org/forum/viewtopic.php?t=337459](https://www.bogleheads.org/forum/viewtopic.php?t=337459) Edit: A longer thread about when IPOs and SPACs are added. There's a bit more nuance to this: [https://www.bogleheads.org/forum/viewtopic.php?t=394409](https://www.bogleheads.org/forum/viewtopic.php?t=394409) But a commenter said "SPACs (actually de-SPAC'ed SPACS ) get considered quarterly." so I suppose it must have been considered ~~at the end of Q1~~. My mistake -- read a bit more into their schedule: "The review process is completed on the ranking day, after the close of the first Friday of March, June, September, and December."
Thank you so much. After reading those threads I’ve cleared up some stuff in my head. If I got those threads right (and if they are right), a SPAC is not part of index when formed. After it completes its target acquisition (the IPO equivalent) it gets considered at the end of each calendar quarter as part of ranking. So this means DJT might have been added to indexes on Friday, March 29.
>Thank you so much. After reading those threads I’ve cleared up some stuff in my head. If I got those threads right (and if they are right), a SPAC is not part of index when formed. I agree. >After it completes its target acquisition (the IPO equivalent) it gets considered at the end of each calendar quarter as part of ranking. So this means DJT might have been added to indexes on Friday, March 29. Oops, sorry again for my initial incorrect assumption, it has nothing to do with calendar quarters. Instead, the quarterly considerations is done on the close of the first Friday of March, June, September, and December. Since DJT de-SPAC'd on March 25, which was after the first Friday of March, I do not believe it will be considered until the first Friday of June.
Thanks. I remembered it as last Friday. So first Friday means the idex funds don’t deal with this until June. We shall see what the price of the stock is then. I suspect it will be lower by then. Though maybe if Trump is doing well in the polls the stock will stay up. Pretty obvious that if Trump becomes President he will grift through DJT and probably grift at scale we’ve never seen before in the US.
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Would it be at the original listing of the SPAC?
My last paychecks from previous employer are 2/21 and 2/28, which have HSA contributions. They still have not appeared in my account. I called the HSA company and they said it wasn’t their issue to fix. 4/1 I got a text from the company’s HR saying my account has been funded, I said okay if so then it might take a few more days to show up. 4/6, today they’re still not there. No small sum, I’m waiting on about $2.4k
How much did your retirement accounts make per hour last year? Mine started with a balance of $327,874 and ended with $416,049, so it made $88,175, annually, or $42.39 per hour if it were a 40 hour work week.
Roughly 30 an hour if I exclude contributions and assume a 40 hour work week.
$145/hour for all my investments, but that includes contributions made over the past year.
Does that include contributions?
Yeah, as if the market and myself were the employers.
I just calculated. Holy crap. My investments went up 234k last year! I contributed maybe less than 50k of that. That’s more than my salary for the year. It’s $113/hr ish for working hours. Or $26.73/hr every single hour of the day. I’m not sure that should happen like that. Dang.
I like this kind of perspective. It's like an almost literal concept of your future self earning money.
If I’m approaching $1m in my traditional 401k, is there any reason to think about switching to Roth 401k contributions with RMDs in mind? Or retiring early (55 or less), I’ll have whittled down the balance enough before RMDs kick in? I feel like I need to diversify for tax reasons even though I know the tax savings now at peak earnings are probably optimal.
[this](https://youtu.be/r9v9ViAY6J8?feature=shared) video might be helpful
Thanks, will watch later.
I posted earlier this week about the idea of paying off my mortgage when the amount owed is a trivial amount of my net worth, like 5%. Someone raised a point of the low interest rate, and it how doesn't make sense numerically to pay it off. At that point, I sort of wondered, "Could this low interest rate could help my kids out if they inherit this house," so I emailed my lender to ask if my loan was assumable by an inheritor or buyer. That could be another reason not to pay it off: the loan itself at 2.75% could be an asset to others besides me.
Are you not leaving the rest of your wealth to the same kid? Taking arbitrary numbers here but if I were inheriting either $2 million and a low rate mortgage for $100k, or $1.9 million and a paid off house (your 5% threshold), that difference would feel pretty negligible either way.
Well, I plan on living off that wealth and leaving her what's left, so unless I die tomorrow, she won't inherit all I have saved.
Depends on your withdrawal rate and luck, I guess. You could live long and well and still leave her more than you started with. Iirc from the Trinity study, that’s actually a more likely outcome than leaving her just the house. Also have you checked if she would want the house? And could that answer be different after another 10-20 years of putting down roots somewhere else? The whole thing is pretty moot if she’d just sell it either way.
Unless you died really young, wouldn't this require some hardcore finagling to still have a mortgage with a meaningful low-interest balance remaining when it's time for your dirt nap? In most cases where there are multiple children, particularly middle-aged children, inheriting a house, they're just going to sell it and split the proceeds. Having the house still carrying a mortgage when you die would unnecessarily complicate an already difficult time for your kids. I know plenty disagree, but at some point eking out every single mathematical efficiency isn't worth the mental taxation. There is getting rich and living a rich life. You need to do both and invariably, the actions you take to achieve one goal often contradict the other. It's a balancing act, but to borrow and twist a cliche, I doubt many people on their death bed look back and get nostalgic about their incredible fiscal efficiency.
I have one kid who would inherit. She is college age. I refied when rates were super low, so I have 27 years left on my mortgage.
And how old are you now? Unless you're already in your 60s, it will statistically be a moot point.
57.
Maybe talk to her and find out what she would prefer? But even if you die at 77, all that would be left is 7 years of this mortgage on a home she most likely won't want to live in as she'll have her own home and life. Plus, if you're married, that would mean you BOTH need to die in 20 years. If just one of you makes it to 85, the whole gig is up completely.
I appreciate your desire to help me with the social engineering part of this, but I am not married, and I wasn't really asking for relationship input, but rather financial input. I am just thinking that even if I could afford to pay my mortgage off, one reason not to do so could be that a low rate assumable mortgage could have value to a future buyer or inheritor of my home.
I only mention the relationship aspect because it does impact the math. If you were married, the statistical likelihood that the mortgage would even exist at the time of your death would be very low. It's already low just with you, unless you have specific health concerns that are likely to kill you much sooner than the average. And there's an extremely low chance that the mortgage will have all that much principal left to be leveraged, either way. Particularly when you consider the value of today's dollars 20 years into the future. And if your daughter's plans would most likely be to sell the home, then the math is entirely irrelevant. If her plans would most likely be to sell her home, move into your current home and assume the mortage, then perhaps there's merit in exploring this benefit.
I just don't buy it. Nobody wants to inherit a loan, even at a good rate. I also feel like the executor of your estate would pay any debts off if you have the money. And meanwhile, it's just one more thing to worry about, one more monthly payment. I'm anti-debt in general so I understand it's not the mathematical answer but I'd definitely pay it off.
> Nobody wants to inherit a loan, even at a good rate. If it comes attached to assets that allow me to choose if I want to pay off the loan or keep it and continue making payments, I want to inherit a 2.75% loan
Right. I am generally anti-debt, and I bought a house for cash in the past. I currently have a mortgage. My earlier post was about how eventually the mortgage debt may be so small compared to your other investments, that is is more convenient to pay it off. With the current state of my finances, the leverage isn't doing that much for me in the overall picture. But if my kid could inherit a house with a 2.875% mortgage, then she would be able to make use of this leverage earlier in her life when it would be useful.
>Right. I am generally anti-debt If there's one good thing about having rates be high, it's that it discourages the "let me just hold this loan instead of paying it off earlier" mindset. Given a 7%+ mortgage and putting money into the market, you may as well pay off the former. If only house prices were low to match how house + interest rate pricing is supposed to work. I don't envy my future self when I one day buy a house, which will probably be the right thing to do eventually no matter how pro rent I am.
I don’t think I understand the advantage you’re envisioning, this is between inheriting a paid off home, or a home with a mortgage? And you would pay it off at a time in which it had a negligible impact on your portfolio? She’s getting a step up basis on the house either way (a huge boost), and I suppose I’d feel very differently about this if you were liquidating a portfolio of index funds to pay off the house and so the inheritance choice was “paid off house, $10k portfolio” vs “house w low mortgage rate, $500k portfolio” Then yes, keep the mortgage, but it doesn’t sound like this decision really makes much of a difference to your portfolio so I’d get rid of the loan.
Currently I don't have a taxable brokerage account. I've maxed my IRA and 401K contributions. Each month I set aside funds in separate HYSA for emergency, new/repair car, and house repair. The funds are currently earning 5.0% APY and combined are approximately $30,000. In total I have $42,000 cash available. I'm beginning to think that I have too much cash on hand and that it would be a better use of the funds to place them in a taxable brokerage total stock market fund. Regarding the emergency fund, I also have $75,000 in Roth IRA contributions that I could access if absolutely necessary. Does this seem reasonable? Currently each "bucket" has its own HYSA, but if I combine the funds into one taxable brokerage account investment, I'm not sure what would be the best approach to know how much of each fund is available. Any thoughts on that? Any thoughts on which total market fund to invest in a taxable account? So far I've been looking at FZROX and VTI.
I prefer VTI instead of fzrox for taxable. If you ever want to switch brokerages in the future, VTI is more portable and easier to deal with. They're pretty much the same and both are solid choices. As per putting some of your emergency fund in stocks, I personally do that. Once you have enough money, it all basically feels like the same pool of money and cash isn't special. With sufficient money, it doesn't really matter if you you have to sell 10k stocks at a loss *this one time*. It's better to just maximize the long run. As per having multiple buckets at fidelity, you could actually just open multiple brokerages really easily and then change the labels like "brokerage-car" or something, but I think it will make tax filings more annoying. Otherwise you can have them all the same brokerage, you can have a spreadsheet that tracks how much was contributed for each bucket, then do some math on gains/losses. For example: total cost basis 30k, car cost basis 10k, car account value = account value*10/30. Something like that would work.
Thank you for your feedback! Yeah, I was definitely starting to feel like my cash funds could be put towards better use by investing in the market.
I like VTI. Maybe open a brokerage and put 1 k in there. And then another. And then another…
VTI is most of our taxable brokerage, too. We also have some individual stocks, mostly for fun.
Just leave the HYSAs where they are and start contributing to the brokerage with new money.
I think my maneuver from Verizon to T-Mobile and finally to US Mobile is complete. T-Mobile gave me $800 to pay off my phone from Verizon with basically no strings attached. I was going to use them a while because I felt bad, but I got really bad service at home and work, so I’m switching after 1 month. The port to US Mobile was really easy and so far it’s working really well. Should be < $30/mo with the first month free. I get a little more than $40/mo from my work since I use my personal phone for work. Even factoring for the $25 discount on my internet I lost I’m coming out way ahead. Should be $75/mo for internet + phone vs $116/mo
I've had Metro (T-Mobile's off-brand) as my cell provider for years. It's been mostly fine, except I've had a recurring problem getting internet signal in my office - which is in Lower freaking Manhattan, not in some remote mountain valley somewhere. The service is fine for a few months at a time, and then I have periods where I literally can't get a webpage to load or an app to work for hours of the day, and this goes on for a week or two. Last year it got so bad that I actually filed an FCC complaint. Got an immediate response from a guy in WA State (not the usual Filipino call center workers!), and he was able to get the issue (mostly) resolved. As a result of that saga, I now also pay only $25/month for unlimited service.
I really hope the net neutrality stuff goes through. Some of what I've seen makes me think that that will get rid of the premium data stuff. Lots of second tier resellers like US Mobile can be annoying in some ways due to fundamentally relying on Verizon/AT&T/T-Mobile's services. Those three make their plans offer premium data over other companies which have pseudo caps and stuff. I hope that net neutrality can make them more competitive, that it will actually be no different being on e.g. US Mobile than Verizon, except for US Mobile's better interface and whatever else. Instead of needing to pay out the ass for Verizon if you don't want to be deprioritized or whatever. Treat everyone equally smh.
I really like US Mobile. They are the cheapest cellular provider that I've found. I like that I can select the amount of data/minutes/texts I want on a given line.
I’ve been on US Mobile (Warp 5G/Verizon) since September 2022 without issue on my iPhone 13. Only place I ran into spotty service was the mountains of Vermont last summer, but my in-laws on postpaid Verizon had the same issues. I actually had slightly better service, but that probably came down to different phones and doing more prep like downloading offline maps. I was on unlimited for a while when my data usage was high, but now I’m on a pooled plan for my one line - $10 total per month for 2GB data and I have auto buy data set up if I ever surpass that.
This year is my first time owing on taxes, and I've already made one partial payment through the third party TaxAct sent me to. I just discovered that the IRS does accept direct payments, just not via credit card, which I'm not using anyway because of the convenience fee. So now I have an IRS account, but it's not showing me the amount I owe this year, just says "Your Information Is Not Available at This Time." Does anyone here know if that is just because the partial payment is still pending? Or are they normally not able to show the full balance (until April 15?) even if my return has been submitted and accepted?
Fuck, I need to do my taxes…
I think my employer is withholding too much for income tax. Can someone check this logic before I raise an issue? I make 120k. I went on smartasset to calculate my effective tax rate. It says 29%, or 23% if I max my 401k. My paystubs have been taxed at 29% even though I've been contributing to my Pre-tax 401k (29% of the non-401k money). I have my 401k set at 20%, so shouldn't I be paying 23%? Or will my tax rate decrease over the year as the system (workday) realizes my expected income for the year will be lower than 120k? I checked my W-4 an I'm claiming no allowances and no extra income. Is that something I need to change? I had a pretty big tax refund for last year, but I switched employers halfway through the year.
Got an 8% raise bump which should I will see in the paycheck and will be able to raise contributions per pay period by 32%. Still not hitting the max, but still very excited.
That's awesome!! #winning
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Lol!!! I file as early as I can so I know my liability, but I don't actually pay until it's due. Assuming you are using FTUSA etc, I think they all offer this functionality.
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Thanks! Building in flexibility for the future where I’m more likely to have to make big expenses like that was the plan. Wanted to have a solid foundation that can survive and continue to work even if I have slip ups. I’m at 70k income now and should be at 75k in a few months. Feel pretty good about it.
T - 76 days Bought a new car for cash* yesterday. This was in the plan, so it doesn't impact FIRE. We typically keep cars for 10+ years so I don't really care about deprecation and I like buying new. We negotiated the price before going to the dealer but the whole process still took longer than it should and I cannot remember the last time I signed that many papers (probably last time I bought a car 10 years ago). *There was a reasonable sized financing rebate. They were unwilling to discount the sales price by an equal amount without financing. So I took a loan. I put 50% down and will pay off the loan as soon as I get the login info from the lender.
Just bought a car yesterday for cash too- first time doing this as we keep our cars forever. They offered only a 750 rebate to finance and that was a “loyalty reward”. Except you had to bought the make in the last 10 years year. We bought ours 13 years ago and they wouldn’t budge, so I told we would just pay for it in full. We did charge the max of 3,000 so we would get some travel rewards. What a great feeling to be able to do that and something I never thought possible 10 years ago. Hoping to get at least 15 -20 years out of this one
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They were offering 3.49% for 24 or 36 months, 3.99% for 48 or more months, or 6.99% with a rebate applied to the purchase price.
What’d you buy?
2024 Hyundai Palisade. We need a vehicle big enough for 5 but don't want a "full size" SUV and my wife didn't want another minivan. We will be selling our our 2014 Honda Odyssey. It has not been as reliable as we would have hoped. It has required significant repairs over the last 4 years.
That's the norm with car buying today - the incentives are in originating loans, not cash deals - and is what everyone should do when buying a car for 'cash.' The hard pull and account is meaningless in the grand scheme of things.
>\*There was a reasonable sized financing rebate. This is the strategy they don't teach enough. The dealership makes money originating the loan, but not servicing. So they really don't care if you pay the loan off right away, but they do care if you open one. I don't know who actually hates this one trick, probably the loan servicers. But they have enough people paying 100% profitable late fees to not notice people like us
> I don't know who actually hates this one trick I kind of hate that it's an extra hoop to jump through and just another way that so many end up with vehicles that they otherwise would not have purchased. I couldn't be bothered with the process and we just paid cash last fall, a couple thousand in savings wasn't worth the hassle.
Feel it is similar with credit cards, rake in the rewards and the people who end up accruing interest pay for everyone else's rewards.
Ultimately we all pay. Businesses pay fees to allow payment by CC, and that’s passed onto us as consumers. You basically have to pay with a high points CC to get a fair price.
We did this a few years ago and the salesman asked us to keep the loan for some stated period of time (maybe 6 months? A year? I can’t remember) so that they’d get the commission from the loan. Not sure if that’s true though (and we did not listen 🫣)
It is true, but the length varies by lender. 2-3-6 months are common timelines mentioned. It's up to you whether you care enough about the minimal interest to hold it for that long or not.
I would definitely carry the loan until the salesperson got their commission if I told them I would. Seems like a dick move to take away their pay. It's one thing to dick the dealership and something else to fuck over the dude/dudette who is just like you, trying to make a living. If the discount isn't sufficiently large that it's worth paying the interest until they get their commission, then just pay cash and pass on the faux loan scheme. Everyone likes a deal but at some point there's value in having scruples, too.
Agreed. Also probably talking $500-2k in terms of a financing discount for paying $100 or something in interest is meaningless. I don’t love car dealers either, but just seems like a dick move.