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Use an escrow service to handle the transaction? You pay them, they handle paying off the lien and getting you the title... I am sure it costs something...This sounds like a great idea.

Statistics: Posted by BolderBoy — Sun Jul 11, 2021 3:17 pm

Good for them.

Don't you suppose they're just taking some of the idle cash and investing it more aggressively in equities or the like and profiting handsomely from that over recent timelines, or do regulations prevent them taking that risk?

I mean, in terms of compensation, Charles R. Schwab and the entire Johnson family are known multi-billionaires. I'm sure Vanguard rewards its executives with a competitive total package, but their frontline people are not known to be compensated any higher than industry standards, and probably lower. I predict eventual declines in service level at both Fidelity and Schwab if current trends continue. It's only an opinion. I don't see how it's sustainable. Check back in 10 years or so.

Statistics: Posted by Cheez-It Guy — Sun Jul 11, 2021 3:17 pm

What if your son gets 80/20 mortgage and only pays you back 360k in first phase? You would get paid back 40k in the second phase.I am not familiar with an 80/20 mortgage - when does second phase happen? Thank youThere is no official second phase. What I meant is that 1) buy in cash 2) get the mortgage for 80% 3) You get 80% + 10% cash (from son) back. This is logical phase one. And then whenever your son can pay back the rest of the 10% that will be second phase.

Statistics: Posted by babystep — Sun Jul 11, 2021 3:17 pm

Thanks for all the comments and replies here. They've been extremely helpful as I come closer to taking the next steps. In this response, I'll focus on discussion related to my taxable account.

As of now, I'm planning to start by heeding the following advice:
Regarding the rest of your taxable holdings, honestly, I would sell them now, take the tax hit now and have cash on hand anyway, and before you get attached to these investments. I would completely ignore what has been doing great and what hasn't been doing great and just grit your teeth (a little) and sell this stuff and buy index funds.Lose those individual stocks and high expense funds before the gains grow big and you are stuck realizing large gains (and thus large taxes). Let the gains become long term gains though, before selling (1 year from date of purchase). Stop dividend reinvestment.Selling everything in my taxable account should leave me with roughly $200K to reinvest (minus capital gains tax?), in addition to the $75K (cash in Fidelity) + $65K (in savings account), for a total of ~$340K (again, this doesn't take into account capital gains tax, which I'm not sure how to factor in). With such a large sum of money (to me), I want to make sure I get this investment right.

Again, here's what y'all suggested:
In taxable, again I'd go with VTWAX and keep things super simple. From my point of view, at least, there is a lot of value in clarity and simplicity in investing. When you have a simple plan and execute it, it is hard to make mistakes and it is easy to let your investments grow for you.With VTWAX, I like how simple this approach would be. If I'm understanding correctly, I wouldn't need to worry about rebalancing, or tracking the performance of different sectors or US vs international. Peace of mind is worth quite a lot to me, as I don't want to spend my life worrying about money.

However, I've been advised by others (such as my financial advisor at Fidelity) that in general, ETFs are more tax-efficient than mutual funds because they avoid the tax on dividends distributed by mutual funds. That said, I'm also remembering that Vanguard uses an approach to eliminate taxes on its mutual funds. So let's put ETF vs mutual fund aside for now.

My second concern has to do with advice I've received to break up the investments in my taxable accounts into different sectors (e.g. large-cap, small-cap, international). The advantage of this, I've been told, is tax efficiency that comes when tax-loss harvesting. With investments in different funds, I could sell off losses to offset gains more easily than if I was invested in just one fund. I do value simplicity, but I wonder if having the option to tax-loss harvest may come in handy down the road.

Lastly, sell everything in your taxable account and invest in VTI (or I bonds)With the advice to invest in VTI, I worry about losing out on diversification from international markets, and (similar to my points above) wonder about the advantages of breaking up VTI into large-cap and small-cap to allow for tax-loss harvesting, when/if needed.

If I were to take this, I'd lean toward a 60% large-cap, 10% small-cap, 30% international split, perhaps using these funds:

1) 60% Vanguard 500 Index Fund Admiral Shares (VFIAX) (.04%)
2) 10% Vanguard Small-Cap Index Fund Admiral Shares (VSMAX) (.05%)
3) 30% Vanguard Total International Stock Index Fund Admiral Shares (VTIAX) (.11%)

Any thoughts, feedback, and suggestions would be very much appreciated.

Statistics: Posted by jcloughesy — Sun Jul 11, 2021 3:16 pm

If the choice comes down to Roth vs 529, you need to save more money or earn more money. Sorry for being blunt, but someone needs to say it.

Statistics: Posted by Lee_WSP — Sun Jul 11, 2021 3:15 pm

I have tried a bunch of calculators. The one at Fidelity shows present and future dollars; data is shown as a graph and in table format.

You should count the pension and SS for planning purposes. If your monthly retirement expenses are very high, you will need a sizable portfolio.

I think the 25x-35x expenses works great as a high level goal. So subtract $72k from your projected retirement expenses and multiple by 30x and that is a reasonable target. You can further refine the goal by including SS at FRA which will further reduce your portfolio goal number.

Statistics: Posted by Wiggums — Sun Jul 11, 2021 3:14 pm

There's a reason why option trading is often referred to as "picking up nickels in front of a steamroller".

Statistics: Posted by JonFund — Sun Jul 11, 2021 3:14 pm

Yes, you can make money selling covered calls, but it's not easy money. I did it for several years and did ok -- met my expectations-- but it's a lot of work and all the problems with the strategey mentioned in this thread are real. As mentioned, it's not easy trying to find somebody who wants to give you good money for an option which has a very good chance of being worthess.Mostly this
Probably a strategy best executed in retirement accounts and on a small portion of your portfolio. Basically don’t sell any calls where you would be upset if your shares got called away.

Statistics: Posted by fanmail — Sun Jul 11, 2021 3:13 pm

I do this as well, but you may want to consider not reimbursing from the HSA this year or anytime soon, and taking advantage of the tax deferred growth in the HSA account.

There is a fairly big tax loophole that you can reimburse from the HSA in any year in the future, even 30+ years if you want, as long as the initial expense was after the HSA formation. If you do this, save all HSA statements and receipts for every year going forward, so you can document it when you actually take it, if audited.

More here: https://www.forbes.com/sites/davidkudla ... dc3a9744c0This is only worth doing if you are maxing out your retirement accounts. Otherwise, you are better off paying medical expenses from the HSA and contributing more to your Roth IRA for 401(k). The HSA has the biggest tax benefit, but you already got that benefit when you contributed deductible money that you could withdraw tax-free.

Statistics: Posted by grabiner — Sun Jul 11, 2021 3:10 pm

so you're saying that diversification does not matter as much if the time period is pretty large, for example 20-30 years?No, I'm saying large random variability of results means that whatever differences you find in the statistics quoted aren't of any particular practical help though the theoretical odds are improved. That is true for any time period. Also you need to believe the inputs to the model are accurate forecasts of the future statistics of the returns. Small changes could reverse any thing there now.

The result is not necessarily a diversification effect. Adding an asset, SCV, that has a higher expected return and higher expected risk will increase the returns and also increase the risk. Diversification is measured by some measure of efficiency of which none is provided nor even a standard deviation of modeled annual returns. Probably the net diversification effect in this experiment is small. Possibly the best statistic of those provided to measure that would be the small increase in SWR, which is not meaningful measured against the wide range of the distribution of possible outcomes.

Statistics: Posted by dbr — Sun Jul 11, 2021 3:10 pm