Personal Finance Formula Assessment Request |
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614Engineer
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Personal Finance Formula Assessment Request |
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Edited as I'm passing this forum out to lots of people in my personal life LOL.
Last edited by 614Engineer on Mon Apr 11, 2016 6:14 pm; edited 1 time in total |
Thu Dec 17, 2015 9:06 pm |
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littleroc02us
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Honestly I think your plan is valid, as long as you address your home ownerships wants in the future. You'll need to save some form of DP which will eat into the equity you've acquired from the sale of your home. So be careful you don't lock up to much of the funds should you decide in a year or two you'd rather be in a house again. Capital gains on 97k can eat up 15%.
I myself am quite conservative and carry no consumer debt, max out Roth IRA's, own rental properties with lots of equity, have a lot of equity in my primary home and invest heavily in 401k's, so I do think your plan sounds great. IMO, if you plan on being single forever, then why own a home? Homes cost money to maintain and pay taxes and interest.
Last suggestion is, make sure you enjoy the next 30 years buy taking some trips if interested, enjoy boating (since you've own one) and do some things that make you happy. Life isn't all about money, although it will be nice to have a retirement where you can fulfill all of your goals, but make sure your leaving room for what moves you.
Risk comes from not knowing what you're doing. (Warren Buffet)
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Thu Dec 17, 2015 9:46 pm |
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oldguy
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Looks good !!
IMO, the correct period of life for wealth-building is the one you selected. And then back-off a bit and move into wealth-preservation. I would even dial up the risk level a bit - ie, use the 'aggressive' 11%/yr selection in your $88k 401k, that adds another $845,000.
Accommodations - a brand new condo might work, no interior maintenance for a decade or more - and the exterior care, plus snow & lawn are done by the HOA. The upside is that, after 30 years, the payment goes away - compared to a similar size/age apartment where the rent will be about 2.5X in Year 2045.
But it doesn't affect your financial plan - with a near-zero down payment and 30 years, a rent payment vs condo payment will be roughly the same. And with a near-zero down, none of your wealth-buillding capital gets pulled off-line.
Aside - On business trips to Dayton, I used to slip down to Lebanon in the evening and watch the Harness Races and have supper at the Track. A nice treat, we don't see much harness racing in the West.
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Thu Dec 17, 2015 10:09 pm |
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littleroc02us
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Old Guy, do you have your Roth money in the VFINX or VFIAX fund? The reason I ask is the VFIAX fund has an expense ration of .05%, with a minimum of 10k, but it's performance since inception (2000) has only been 4.5%, but the VFINX, which has a minimum of 3k and an expense ratio of .17% and it's performance since inception (1976) is 10.72%. I want to move some funds over to one or the other, but it appears that the Admiral fund hasn't been very successful.
Risk comes from not knowing what you're doing. (Warren Buffet)
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Thu Dec 17, 2015 10:29 pm |
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oldguy
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quote: Old Guy, do you have your Roth money in the VFINX or VFIAX fund?
Our Roths (and our other funds too) are in the VFIAX. The main difference is that the VRIAX is 'new", I remember that Vanguard sent us letters notifying us that, as "valued customers", we had been switched to a new account that they had just opened. Same holdings, just a better fee rate for larger accounts.
The VFIAX inception was 11/13/2000 and the VFINX inception was 8/31/1976. At 11/13/2000 the SP500 was close to a peak so the 2000 to 2015 period is only 4.93/yr. And the 1976 period is way better. But they are the same holdings, just looking at different windows of time.
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Fri Dec 18, 2015 12:02 am |
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littleroc02us
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quote: Originally posted by oldguy
quote: Old Guy, do you have your Roth money in the VFINX or VFIAX fund?
Our Roths (and our other funds too) are in the VFIAX. The main difference is that the VRIAX is 'new", I remember that Vanguard sent us letters notifying us that, as "valued customers", we had been switched to a new account that they had just opened. Same holdings, just a better fee rate for larger accounts.
The VFIAX inception was 11/13/2000 and the VFINX inception was 8/31/1976. At 11/13/2000 the SP500 was close to a peak so the 2000 to 2015 period is only 4.93/yr. And the 1976 period is way better. But they are the same holdings, just looking at different windows of time.
So I'm thinking I move 10k over to the VFAIX, because the expense ratio is so low. I know this thread isn't about me, but I hope it helps others.
Risk comes from not knowing what you're doing. (Warren Buffet)
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Fri Dec 18, 2015 3:19 am |
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614Engineer
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@littleroc02us I appreciate the review, all points noted and appreciated.
@oldguy Ditto to the above; and you spent time in OH? Hah.. I'll be out of here at some point, that's for sure. I'm a gear head also, I can't feel too bad about the "sell the boat" idea when I have two motorcycles and a quad still on the toy pile.
I haven''t done any Roth stuff yet, sounds like my next step is to go investigate how to most tax effectively execute this plan..
Last edited by 614Engineer on Sun Dec 27, 2015 3:04 pm; edited 1 time in total |
Fri Dec 18, 2015 8:24 pm |
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614Engineer
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Updates: I adjusted that 401k to the Aggressive model as suggested. Secondly it looks like Etrade (where my old company had it's stock sharing plans, and therefore what i've used since) doesn't offer VFIAX? I haven't yet done any math on what the fee difference impacts are to decide if this is a serious issue or not. Finally, I finally opened a RothIRA. Income could be an issue depending on year but at least it's open and available. Should have done that one 10 years ago, but at least my "shoulda" list is pretty short.
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Sun Dec 27, 2015 3:02 pm |
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oldguy
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quote: Etrade (where my old company had it's stock sharing plans, and therefore what i've used since) doesn't offer VFIAX?
The VFIAX is Vanguard's SP500 index fund, Fidelity's is FUSEX. Each fund company has their own fund symbol. If Etrade doesn't have a SP500 Fund, you can use the Exchange Traded Fund (ETF), it trades like a stock - all brokers buy/sell them. The SP500 ETF ticker symbol is SPY (sometimes referred to as Spyders).
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Sun Dec 27, 2015 5:30 pm |
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614Engineer
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@oldguy... Thanks! However I was referring to VFIAX vs VFINX. eTrade doesn't seem to offer the super low cost VFIAX you guys mentioned above....right now I have VFINX.
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Tue Dec 29, 2015 1:50 am |
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614Engineer
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Not quite two years later and this thread / forum / posts from OldGuy kicked off a whole new life vector. Thanks to the top contributors to this board, the ones who don't have absurdly unrelated agendas but rather post their wisdom simply to help others!
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Wed Sep 06, 2017 3:22 pm |
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oldguy
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Wed Sep 06, 2017 4:47 pm |
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