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[cubicle47b]

I really think financial management should have been taught at some point in high school or college. So many people have no idea what they're doing and many could have learned a lot sooner. Having someone else completely prepare your taxes for you doesn't help either.

 

[Piecake]

I really think financial management should have been taught at some point in high school or college. So many people have no idea what they're doing and many could have learned a lot sooner. Having someone else completely prepare your taxes for you doesn't help either.

There is actually a good bit of data that shows that financial literacy classes are not effective. I have no idea what they teach in those classes, but I have a feeling that the main problem is that high school students just don't care enough to listen and learn because the vast majority of them still have no concept of money ( I know I didnt at that time).

 

[Walter White Walker]

Well, just got the notice that my company is moving their 401k over to Schwab. I really like the funds my current 401k offers so I am a bit wary. Call me pessimistic and jaded, but I think the only way a company would move 401k providers is to save money, and them saving money has an okay chance of fucking me over.

Obviously I have no idea what funds specifically will be available to you, but Schwab is fine as far as I'm concerned. I have a Roth IRA and a brokerage account with them split between SCHB, SCHF, and SCHZ (and also an HSA with the funds in SWPPX). Using Morningstar X-ray my total overall fee is .05%. If you get fucked it's because of the company you work for, not Schwab, I think.

 

[giga]

I always had my Roth as a monthly budget item, where I'd transfer Max/12 on the first of the month and invest it immediately. Don't think it's a big issue to do that instead of stretching to dump the max amount in at the start of the year.

I'm probably going to start doing this. This lump sum purchase I'm doing now for my Roth is hurting.

 

[Piecake]

Obviously I have no idea what funds specifically will be available to you, but Schwab is fine as far as I'm concerned. I have a Roth IRA and a brokerage account with them split between SCHB, SCHF, and SCHZ (and also an HSA with the funds in SWPPX). Using Morningstar X-ray my total overall fee is .05%. If you get fucked it's because of the company you work for, not Schwab, I think.

Oh, I wasnt trying to imply that Schwab is terrible. I am just pessimistic that the retirement package will be filled with crap and my company will save a lot of money because of it.

 

[Randolph Freelander]

Oh, I wasnt trying to imply that Schwab is terrible. I am just pessimistic that the retirement package will be filled with crap and my company will save a lot of money because of it.

You'll get a money market fund and a target 2020 fund with a 1.1% expense ratio.

 

[iamblades]

You'll get a money market fund and a target 2020 fund with a 1.1% expense ratio.

This is probably pretty accurate, depressingly.. Probably a few shitty bond funds and a 'strategic' fund as well.

I've always wondered what kind of sketchy bullshit is going on behind the scenes that leads to only the worst investment products making it into 401(k) plans and company retirement programs. At this point there is no excuse for those programs not having at least a coupld of index fund options.

 

[Randolph Freelander]

^ I'd like to believe it's just low information decision making. People running businesses might be good at what they do, but finance isn't necessarily it. They hear a presentation, hear catch phrases like "beats the Lipper average" and sign up.

 

[GhaleonEB]

^ I'd like to believe it's just low information decision making. People running businesses might be good at what they do, but finance isn't necessarily it. They hear a presentation, hear catch phrases like "beats the Lipper average" and sign up.

This is probably the case quite often, especially for smaller companies. My employer is a Fortune 100 company with enormous HR and finance departments. We were trapped in a horrific fund until this year. I'm sure there is lots of ignorance / poor decisions out there, but we finance folks were shouting from the rooftops for years. Something else was up.

 

[Zolf]

This is probably pretty accurate, depressingly.. Probably a few shitty bond funds and a 'strategic' fund as well.

I've always wondered what kind of sketchy bullshit is going on behind the scenes that leads to only the worst investment products making it into 401(k) plans and company retirement programs. At this point there is no excuse for those programs not having at least a coupld of index fund options.

If it's anything like my employer's 401k, it will definitely have index funds... they'll just have 1% expense ratios like everything else in the plan.

 

[Makai]

There is actually a good bit of data that shows that financial literacy classes are not effective. I have no idea what they teach in those classes, but I have a feeling that the main problem is that high school students just don't care enough to listen and learn because the vast majority of them still have no concept of money ( I know I didnt at that time).

My high school civics class had a day where people were paired into couples. Each couple was given a random number of kids and a random salary. I think I had to budget a full year of expenses with two kids, a stay-at-home mom, and a minimum wage salary. We had to go into debt. I bet we would have been in the black if we were allowed to consider government benefits.

 

[Anno]

My employer started a profit sharing program last year paid directly into our 401k. We had a decent year and last week was our first payout, which amounted to about a months worth of my contributions/match. It's only another drop in the bucket but it sure feels good to see. I also like that those who don't have a 401k will basically be forced to open one to benefit; if they don't choose a fund it'll just go straight into VWENX, which seems like a good compromise all told.

 

[acksman]

Did quite a bit of reading over the past couple of weeks. Looks like I will be putting in a buy on these this week. If anyone has any feedback if they have any of these holdings I would appreciate it.

30% VTI 0.05 Vanguard Total Stock Market ETF https://personal.vanguard.com/us/funds/snapshot?FundId=0970&FundIntExt=INT
20% VO 0.09 Vanguard Mid-Cap ETF https://personal.vanguard.com/us/funds/snapshot?FundId=0939&FundIntExt=INT
15% BND 0.08 Vanguard Total Bond Market ETF https://personal.vanguard.com/us/funds/snapshot?FundId=0928&FundIntExt=INT
15% VEA 0.09 Vanguard FTSE Developed Markets ETF https://personal.vanguard.com/us/funds/snapshot?FundId=0936&FundIntExt=INT
10% VNQ 0.1 Vanguard REIT ETF https://personal.vanguard.com/us/funds/snapshot?FundId=0986&FundIntExt=INT
10% VXUS 0.14 Vanguard Total International Stock ETF https://personal.vanguard.com/us/funds/snapshot?FundId=3369&FundIntExt=INT

 

[PflargBlarg]

Curious why you would buy the Vanguard Mid-Cap when you already have the Total Stock Market?

 

[acksman]

Curious why you would buy the Vanguard Mid-Cap when you already have the Total Stock Market?

Good question and maybe I am overthinking this. By holding both VO and VTI I would be tiltiing my portfolio towards specific asset classes. As seen below in the graphs you would be leaning more on Tech top stocks in VTI while you would have more diversifed selection in VO. VO is a bit higher in ratio and more risk as well.

VTI

VO

 

[vehn]

So which investment option here is better:

Option A)
* Max out my Roth 401K contributions coming out from my paycheck (18k) a year (but this would have access to a limited # of funds to contribute to, and those funds have a 0.98% expense ratio)
* Max out Roth IRA contributions externally (5.5k)

or

Option B)
* Only put a small amount into Roth 401K, and putting a bunch of other money into a personal account with the VTSMX / VGTSX indexes
* Max out Roth IRA contributions externally (5.5k)


I'm seeing with (A), none of that money would be taxed when I take it out for retirement, but I have to pay high-ish fees plus not have the best investment choices. And with (B), I have to pay taxes on the gains, but its lower fees and better investment choices.

 

[Cyan]

Missing info there. What kind of match do you get, if any?

 

[vehn]

Missing info there. What kind of match do you get, if any?

I get a 5% match to the Roth 401k, so I would keep on putting at least 5% in the Roth 401k in either option

 

[Randolph Freelander]

So which investment option here is better:

Option A)
* Max out my Roth 401K contributions coming out from my paycheck (18k) a year (but this would have access to a limited # of funds to contribute to, and those funds have a 0.98% expense ratio)
* Max out Roth IRA contributions externally (5.5k)

or

Option B)
* Only put a small amount into Roth 401K, and putting a bunch of other money into a personal account with the VTSMX / VGTSX indexes
* Max out Roth IRA contributions externally (5.5k)


I'm seeing with (A), none of that money would be taxed when I take it out for retirement, but I have to pay high-ish fees plus not have the best investment choices. And with (B), I have to pay taxes on the gains, but its lower fees and better investment choices.

How long do you plan to be there? If it's 30 years, the answer is different than if it's 5. The shorter your duration, the more you stand to gain by just utilizing the employer plan because of the tax avoidance. The longer, the more those fees eat away at your returns and negate any tax benefits. Just run some numbers on a series of payments growing at, say, 9% vs. 8% for any length of time, with the difference basically representing your plan's fees.

 

[Cyan]

How long do you plan to be there? If it's 30 years, the answer is different than if it's 5. The shorter your duration, the more you stand to gain by just utilizing the employer plan because of the tax avoidance. The longer, the more those fees eat away at your returns and negate any tax benefits. Just run some numbers on a series of payments growing at, say, 9% vs. 8% for any length of time, with the difference basically representing your plan's fees.

Once he maxes out the Roth 401k match, the tax consequences should be the same either way.

 

[Randolph Freelander]

Once he maxes out the Roth 401k match, the tax consequences should be the same either way.

Those gains grow tax free in the Roth, not in the independent investment option. He's talking about going into the market, which brings capital gains into play for long term gains and, of course, regular marginal rates for short gains.

 

[Cyan]

Those gains grow tax free in the Roth, not in the independent investment option. He's talking about going into the market, which brings capital gains into play for long term gains and, of course, regular marginal rates for short gains.

Oh, I misread it as a choice between a Roth 401k and a Roth IRA.

 

[Randolph Freelander]

Oh, I misread it as a choice between a Roth 401k and a Roth IRA.

I figured that might have been the case.

Returning to vehn, I ran some numbers because I get interested like that.

Payment	Return	Years	Ending Value	Percent	Total Gains	Percent
18000	8%	30	$2,039,097.80 	83%	$1,499,097.80 	78%
18000	9%	30	$2,453,535.69 	100%	$1,913,535.69 	100%				
						
18000	8%	5	$105,598.82 	98%	$15,598.82 	88%
18000	9%	5	$107,724.79 	100%	$17,724.79 	100%
											
18000	8%	15	$488,738.05 	92%	$218,738.05 	85%
18000	9%	15	$528,496.49 	100%	$258,496.49 	100%

Kind of think about what the expectation for tax would be. Focusing on the gains, is the tax going to be more or less than the difference? More or less than 22% after 30 years? More or less than 12% after 5? If it's more, go with the 401K plan. If it's less, go with independent investments (after getting all of your match).

If this is a short duration stop in your career, the 401K appears to me to be the more attractive option, because after you leave the company, you can roll those funds into a Roth IRA and get the higher level of returns you desire, tax free. (Even if it's not a short duration stop, there's always the chance the company could get more attractive options in your plans, and you might be the one to help facilitate that change.)

 

[vehn]

Thanks for the help, will definitely be investing it for 30 years, though not sure how long I'll be staying at this company.

My long term capital gain tax set at 15% (so its less than 22% at 30 yrs, meaning individual is better), though I should probably go try and max out the Roth 401k anyway in the case I leave the company and can roll it over to better options.

 

[Piecake]

Good question and maybe I am overthinking this. By holding both VO and VTI I would be tiltiing my portfolio towards specific asset classes. As seen below in the graphs you would be leaning more on Tech top stocks in VTI while you would have more diversifed selection in VO. VO is a bit higher in ratio and more risk as well.

VTI

VO

Interesting take. Usually when people tilt a cap they choose small caps.

I would just stress one thing. Total stock market is more diverse than mid cap since total includes all American companies while mid cap only includes mid cap. Total stock simply reflects the current state of our economy, which is the reason why some sectors have a greater percentage than others. Mid cap currently reflects the middle business portion of our economy. Obviously, that can change. So if you go through with this strategy, you need to make sure that you keep up on those funds and monitor those percentages.

Honestly, I haven't seen any research on a sector balance approach to indexing, but instead of using mid cap to try to get a bit more sector balance, I would imagine that there are some sector funds out there that you can invest in. That might be a bit easier than trying to balance Total and mid together and simply use sector funds to balance out the total. Personally, I am not a huge fan of tilting since I just look at that as a bet, but if you are comfortable with it and think it is the correct choice, then go for it.

 

[PflargBlarg]

This may not be exactly the right place to post about this but it's been weighing on my mind.

When I was younger and stupid I bought a condo which I was renting to my parents while they were looking for a new house after they sold their previous one. They've now found a new house and are just about locked in to purchasing it.

I'm not really sure what to do.

I bought it for 268,800 and I've got 223,905 left on the principal at a 3.09% interest rate. Monthly cost is 962 plus 217 in strata fees. I've been looking around on Padmapper at similar stuff and I feel like it may be difficult to find someone at a monthly rate that will cover that. I mean, I may be wrong since my condo is brand new in comparison to all the older buildings that I'm comparing it to and it's quite nice.

And on the other hand I'm probably going to lose a significant amount of money if I sell it.

I guess the issue is finding renters and the fact that I can't sustain it for long with it being empty. I'm quite sure I could do it with cutting spending but I wouldn't really be able to save and I've got a wedding coming up next year. Would you guys say that I should do my best to find a renter that can cover my costs and if that doesn't work just undercut myself in order to get at least some money? I can lose 200-300 on the rent without it being a problem.

I dunno. I feel like an idiot.

 

[TangoAlphaLima]

This may not be exactly the right place to post about this but it's been weighing on my mind.

When I was younger and stupid I bought a condo which I was renting to my parents while they were looking for a new house after they sold their previous one. They've now found a new house and are just about locked in to purchasing it.

I'm not really sure what to do.

I bought it for 268,800 and I've got 223,905 left on the principal at a 3.09% interest rate. Monthly cost is 962 plus 217 in strata fees. I've been looking around on Padmapper at similar stuff and I feel like it may be difficult to find someone at a monthly rate that will cover that. I mean, I may be wrong since my condo is brand new in comparison to all the older buildings that I'm comparing it to and it's quite nice.

And on the other hand I'm probably going to lose a significant amount of money if I sell it.

I guess the issue is finding renters and the fact that I can't sustain it for long with it being empty. I'm quite sure I could do it with cutting spending but I wouldn't really be able to save and I've got a wedding coming up next year. Would you guys say that I should do my best to find a renter that can cover my costs and if that doesn't work just undercut myself in order to get at least some money? I can lose 200-300 on the rent without it being a problem.

I dunno. I feel like an idiot.

Do you have a rough estimate for how much you could sell it for after realtor fees?

 

[PflargBlarg]

It's a tough call. I'd guess that my money in pocket after selling would range somewhere between 250000 - 255000? Potentially lower. There's apparently not a lot of demand for the units as there's still a couple unsold ones left in the 2 buildings that have units for sale. I'm not convinced that I could currently sell it for as much as I bought it for.

Plus the difficulty of finding a buyer is likely higher than the difficulty of finding a renter.

 

[Wellington]

Refresh my memory, who did you use? Vanguard and Fidelity both offer a wide variety of no load mutual funds, which means you don't pay commission as long as you can buy the minimum investment and you don't sell too quickly (something like 90 days). I think you can also avoid fees if you sign up for automatic investments, but check to be sure.

Find a fund you like and invest. VTSMX (if with Vanguard) or FSTMX (if with Fidelity) might be a good starting place. Those are their total stock market funds, which are going to get you exposure to the full US economy at about at 8:2:1 ratio of large caps to mid to small, including both growth and value stocks. As your portfolio grows, you can add international, bonds, etc., to suit your particular diversification strategy and risk tolerance.

Why VTSMX over VTI?

 

[Randolph Freelander]

Why VTSMX over VTI?

No dollar left behind. He can convert over to VTSAX once he has enough to cover the 10K minimum. If the expense ratio difference (0.17% to 0.05%) gives you heartburn, then feel free to act differently.

-------

Just to put some numbers to it, since I like doing it and really also for my own education, VTI closed at 108.70 today, so $5500 (current IRA limit) can get you 50 shares for a total of $5435, which leaves $65 on the table. You could instead invest the full $5500 in VTSMX. If we hold market returns for a year at 10% and factor in the expense ratios, how would each investment perform?

$5500 * (10% - 0.17%) = 540.65
$5435 * (10% - 0.05%) = 540.78

In this example based on today's ETF price, the ETF gets you ahead by 13 cents. The calculation might change tomorrow if you're leaving more or less money on the side when you buy in. Indeed, yesterday's closing price of $108.64 would have left $68 on the side, and the return (at 10% - 0.05%) would come to $540.48, or 17 cents less than the mutual fund. (Edit: I should say that a higher rate of return than 10% favors the mutual fund more, a lower rate favors the ETF more, that's just how it works out.)

So yeah, go wherever, but by the time you can cover the minimum on VTSAX, I'd personally recommend that over the ETF so that every last dollar is working to your beneift.

 

[Scooter155]

Sooooooooo.... what reputable companies handle retirement investing? Like, after reading the OP my first step would just be to google "Index Funds" and click on the first search result, I'm guess that'd be a bad way to start...

Also, is employer sponsored 401k a beneficial thing if they don't match contributions? I work for the state of CA and we have a "relationship" with this company called Savings Plus - https://www.savingsplusnow.com/ with a few 401k plans but they don't contribute any money. Can I just get a 401k on my own through a 3rd party? Is that a terrible idea?

Just turned 30 and getting anxious about my lack of savings but don't even know where to start...

 

[TangoAlphaLima]

Sooooooooo.... what reputable companies handle retirement investing? Like, after reading the OP my first step would just be to google "Index Funds" and click on the first search result, I'm guess that'd be a bad way to start...

Also, is employer sponsored 401k a beneficial thing if they don't match contributions? I work for the state of CA and we have a "relationship" with this company called Savings Plus - https://www.savingsplusnow.com/ with a few 401k plans but they don't contribute any money. Can I just get a 401k on my own through a 3rd party? Is that a terrible idea?

Just turned 30 and getting anxious about my lack of savings but don't even know where to start...

I used to have a Vanguard account, but I now go with T. Rowe Price. Both are good options. Lots of people love Vanguard. I think Fidelity is supposed to be a good option as well, but I have zero personal experience with them.

Regarding a 401k, it really depends on how much you can save for retirement. Given your age, you should definitely be opening a Roth IRA and maxing that out before even thinking about a 401k since there's no employer match.

 

[Piecake]

Sooooooooo.... what reputable companies handle retirement investing? Like, after reading the OP my first step would just be to google "Index Funds" and click on the first search result, I'm guess that'd be a bad way to start...

Also, is employer sponsored 401k a beneficial thing if they don't match contributions? I work for the state of CA and we have a "relationship" with this company called Savings Plus - https://www.savingsplusnow.com/ with a few 401k plans but they don't contribute any money. Can I just get a 401k on my own through a 3rd party? Is that a terrible idea?

Just turned 30 and getting anxious about my lack of savings but don't even know where to start...

I use Vanguard and have no problems with it. Fidelity is another popular choice.

If there is no employer match, you should open up an IRA (either traditional or Roth depending on circumstances and preferences). A 401k is only offered through your employer. You can't individually get in on a 401k plan. An Individual Retirement Account (IRA) is what you are looking for). If you want to save more for retirement, just invest in one of those retirement vehicles that your employer offers.

I'm kinda surprised that you have such shit benefits as a government employee. Aren't all state/federal employees offered the Thrift Savings Plan?

 

[vehn]

No dollar left behind. He can convert over to VTSAX once he has enough to cover the 10K minimum. If the expense ratio difference (0.17% to 0.05%) gives you heartburn, then feel free to act differently.

-------

Just to put some numbers to it, since I like doing it and really also for my own education, VTI closed at 108.70 today, so $5500 (current IRA limit) can get you 50 shares for a total of $5435, which leaves $65 on the table. You could instead invest the full $5500 in VTSMX. If we hold market returns for a year at 10% and factor in the expense ratios, how would each investment perform?

$5500 * (10% - 0.17%) = 540.65
$5435 * (10% - 0.05%) = 540.78

In this example based on today's ETF price, the ETF gets you ahead by 13 cents. The calculation might change tomorrow if you're leaving more or less money on the side when you buy in. Indeed, yesterday's closing price of $108.64 would have left $68 on the side, and the return (at 10% - 0.05%) would come to $540.48, or 17 cents less than the mutual fund. (Edit: I should say that a higher rate of return than 10% favors the mutual fund more, a lower rate favors the ETF more, that's just how it works out.)

So yeah, go wherever, but by the time you can cover the minimum on VTSAX, I'd personally recommend that over the ETF so that every last dollar is working to your beneift.

So I have a bunch of $ in VTSMX / VGTSX. Should I instead switch these to the Admiral shares (VTSAX / VTIAX) for the lower expense ratio?

 

[Randolph Freelander]

So I have a bunch of $ in VTSMX / VGTSX. Should I instead switch these to the Admiral shares (VTSAX / VTIAX) for the lower expense ratio?

If you have enough to cover the minimums, there's no reason not to be in the admiral versions of funds, as it will cut down further on the already low expenses. I thought I had read that Vanguard might convert you automatically, but since I don't use Vanguard, I wouldn't know from experience.

 

[Ovid]

No dollar left behind. He can convert over to VTSAX once he has enough to cover the 10K minimum. If the expense ratio difference (0.17% to 0.05%) gives you heartburn, then feel free to act differently.

-------

Just to put some numbers to it, since I like doing it and really also for my own education, VTI closed at 108.70 today, so $5500 (current IRA limit) can get you 50 shares for a total of $5435, which leaves $65 on the table. You could instead invest the full $5500 in VTSMX. If we hold market returns for a year at 10% and factor in the expense ratios, how would each investment perform?

$5500 * (10% - 0.17%) = 540.65
$5435 * (10% - 0.05%) = 540.78

In this example based on today's ETF price, the ETF gets you ahead by 13 cents. The calculation might change tomorrow if you're leaving more or less money on the side when you buy in. Indeed, yesterday's closing price of $108.64 would have left $68 on the side, and the return (at 10% - 0.05%) would come to $540.48, or 17 cents less than the mutual fund. (Edit: I should say that a higher rate of return than 10% favors the mutual fund more, a lower rate favors the ETF more, that's just how it works out.)

So yeah, go wherever, but by the time you can cover the minimum on VTSAX, I'd personally recommend that over the ETF so that every last dollar is working to your beneift.

I bought VTSAX.

Speaking of Wellington, what do you think of the Wellington fund? I remember Bogyle talking about on the a podcast (Econtalk) a few years ago.

 

[yggdrasill]

I would like to change index funds. Is it best to transfer the whole amount or just change where your paycheck contributions go? Or it doesn't matter?

 

[anonymous_abc]

I would like to change index funds. Is it best to transfer the whole amount or just change where your paycheck contributions go? Or it doesn't matter?

Well you will likely have fees for selling the old and buying the new. So depending on the TER and distribution of your old index funds it might not be so bad to just keep hold of them and add all new contributions to new indexes.
It all really depends on your desired asset allocation though.

When I changed strategies after a few months I just kept everything from the first few months, this led to major overweighting of certain assets which I have been gradually reducing with my new contributions. I am now making strides to get the distribution close to my desired allocation. I am purely on a buy and hold strategy though, so selling isn't really high on my list of options.

 

[GhaleonEB]

I would like to change index funds. Is it best to transfer the whole amount or just change where your paycheck contributions go? Or it doesn't matter?

The two things to consider are the fees (primarily the expense ratio) on your current funds, and, if the funds are outside of retirement, the cost of selling them and moving into index funds due to the realization of capital gains. If they're in retirement accounts you don't have to worry about that.

The higher expense ratio in most non-index funds will absolutely eat into a large proportion of your returns over the long haul. I'd advise moving out of them sooner rather than later. If they are in a retirement account, there's nothing to lose with doing so quickly.

I transitioned our retirement funds to all index funds in 2013, and split shifting our funds that were outside retirement accounts across 2013 and 2014 to soften the capital gains hits.

 

[hipbabboom]

So this upswing over the past three weeks more of the normal behavior of the index after two months of pretty lethargic performance or should we expect to see more bad days ahead?

 

[anonymous_abc]

So this upswing over the past three weeks more of the normal behavior of the index after two months of pretty lethargic performance or should we expect to see more bad days ahead?

There are always bad days ahead.

Spoiler

Good ones too mind.

Stop worrying and start loving the bomb!

 

[GhaleonEB]

So this upswing over the past three weeks more of the normal behavior of the index after two months of pretty lethargic performance or should we expect to see more bad days ahead?

It's pretty normal. Over the long term, the trajectory is up, which is what matters.

 

[Wellington]

The two things to consider are the fees (primarily the expense ratio) on your current funds, and, if the funds are outside of retirement, the cost of selling them and moving into index funds due to the realization of capital gains. If they're in retirement accounts you don't have to worry about that.

The higher expense ratio in most non-index funds will absolutely eat into a large proportion of your returns over the long haul. I'd advise moving out of them sooner rather than later. If they are in a retirement account, there's nothing to lose with doing so quickly.

I transitioned our retirement funds to all index funds in 2013, and split shifting our funds that were outside retirement accounts across 2013 and 2014 to soften the capital gains hits.

Yea I assumed you meant capital gains taxes.

Stupid question, I have done pretty well with a number of stock picks. I bought them in the 2014 tax year (April). To avoid the heavy hit from cap gains, can I sell now that I am out of the tax year or do I have to wait for the exact 1 year mark to pass?

So this upswing over the past three weeks more of the normal behavior of the index after two months of pretty lethargic performance or should we expect to see more bad days ahead?

The market does not like January.

 

[Cyan]

Yea I assumed you meant capital gains taxes.

Stupid question, I have done pretty well with a number of stock picks. I bought them in the 2014 tax year (April). To avoid the heavy hit from cap gains, can I sell now that I am out of the tax year or do I have to wait for the exact 1 year mark to pass?

Gotta hold them for a whole year.

 

[Randolph Freelander]

Yea I assumed you meant capital gains taxes.

Stupid question, I have done pretty well with a number of stock picks. I bought them in the 2014 tax year (April). To avoid the heavy hit from cap gains, can I sell now that I am out of the tax year or do I have to wait for the exact 1 year mark to pass?

You have to hold the equity for a full year to qualify for a capital gains rate instead of counting it as ordinary income.

 

[Piecake]

America Wants to Save More. It Just Needs More Money to Do It

Shocking news. Poor people want to save for retirement and other things, but simply don't make enough money to do it.

I really think our system is rather screwy. the jobs that poor people have are usually jobs that do not have a 401k, so they do not get the benefits of an employer match. Moreover, because they earn more throughout their life they earn less in social security. They will also be in jobs more likely to result in them retiring early due to physical problems and not have the retirement savings to push off taking social security until they are 65-70, meaning they cannot increase their social security benefit by holding off on taking it.

I mean, what kind of retirement system deliberately hurts the population that needs the most help in accumulating retirement savings or having retirement security? A pretty stupid one if you ask me.

 

[GhaleonEB]

Interesting that the more money people have, the more they worry that it will run out. I wonder if that trend continues up through the income brackets. I've read that the wealthy, rather than worry less about their money, actually worry more about it the wealthier they get. That chart seems to point in that direction.

 

[Piecake]

Interesting that the more money people have, the more they worry that it will run out. I wonder if that trend continues up through the income brackets. I've read that the wealthy, rather than worry less about their money, actually worry more about it the wealthier they get. That chart seems to point in that direction.

I think its just that the poor know its going to run out so that isnt one of their major concerns. Its a certainty, not a dire possibility.

 

[Makai]

Interesting that the more money people have, the more they worry that it will run out. I wonder if that trend continues up through the income brackets. I've read that the wealthy, rather than worry less about their money, actually worry more about it the wealthier they get. That chart seems to point in that direction.

There was that study that showed that even wealthy people live paycheck to paycheck. They have a lot more to lose.

 

[Cyan]

Interesting that the more money people have, the more they worry that it will run out. I wonder if that trend continues up through the income brackets. I've read that the wealthy, rather than worry less about their money, actually worry more about it the wealthier they get. That chart seems to point in that direction.

Just looking at that chart, I'm guessing they asked which of the four things people were most worried about. So it's not that people are more worried about running out of principal as their income increases, but that they're less worried about having debt or not being able to afford daily expenses. Which makes perfect sense.