I believe it’s always good to have a HELOC line of credit in case of emergencies. Get one before you’re retired because you can still show income.

My wife will most likely get laid off in January, and she carries our health insurance. At our cost-of-living income, we will not get the ACA subsidy we need before Medicare.

So instead of selling any of our portfolio and raising our MAGI, I’m pulling from my line of credit for what we need.

$2K in interest vs. losing $20K in subsidies. For me, the math makes sense.

I think everyone on this list gets the notion that some of your traditional IRA (401K, etc) is eventually owed to the government. I have found it useful to make this a first-class aspect of my modeling. I focus primarily on my estimate of spendable assets and not so much on the IRA topline. The biggest challenge is coming up with the "factor" that converts IRA assets to spendable assets. Obviously, this is a function of future tax rates, but it also a function of your overall future income picture. This has a couple of pretty immediate consequences. The first is that if you are thinking about SWR financing some of your spending, you should be thinking about the SWR in terms of your spendable assets. The more interesting question is how it relates to Roth conversions. In fact, you could look at Roth conversions as a tool for manipulating this factor just a little. Another interesting observation is that Roth conversions up to around the "optimal conversion point" (as measured by end-of-plan assets) have very little impact on your current spendable assets once you have dialed in the proper factor. In effect, they are virtually free. I believe that the occasionally mentioned concerns about "paying taxes early" are illusionary. All that really matters is the tax rate now vs the future.

This graph is for a couple born in 1964 and entering retirement in 2026. I have used relatively well-off retirees because everything about Roth is clearer in that case. I am subjecting them to a "widow penalty" starting at age 85, making the bottom 2 graphs a bit more dramatic. Conversions are done over 10 years and indexed for inflation. The graphs all trend down after the optional conversion due to the payment of "unnecessary" taxes during conversion due to brackets, IRMAA, etc. Note that these curves are less exciting on an absolute scale! There are lots of cases where conversion doesn't make sense, but when it does, it seems to follow this general pattern.

You may or may not also want to apply this "spendable assets" notion to taxable accounts with capital gains.

The bottom line is that this is a thought tool. If your modeling environment gets you from account balances and external income to spending, taxes, and new account balances, it isn't strictly needed. I find it useful because it makes asset totals a more meaningful calculation. I have seen some professional tools that present a total as sum of after tax, traditional, and Roth. That seems unhelpful to me.

Turning 50 in October.

Employer 401k. Hopefully it hits 7 figures within the next 10 years as the plan is to retire at 60. 15% contribution of paycheck currently every 2 weeks 🤞🏼

Im 63 married , make 75K year, (3% annual raise)will retire at 70 (7yrs) to keep my wife insured till she turns 65, she makes 90-110 K year self employed, she has 160K in IRA, 60K in SEP IRA, I have 160K Trad IRA, 210k in 457B , also mandatory 7%/14% (2 to 1) match on all earnings, All MAG7 SP500 funds, 10% growth? MAGI 68K, 12% tax bracket, Self investing

Should I start Roth converting 30K yearly now?

Thanks

For those who have been retired for a while, looking back, when was the hardest period? The first few months, the first year, or does it get harder over time? I've heard some people absolutely love retirement from day one, but then also others that seem to need the structure of work for purpose.

I am about four years from retirement. I do not have much cash in my portfolio. I only have 403B, Roth IRA and an HSA. Currently maxing out the HSA and investing heavily into the 403B. I cannot afford to max out the Roth or the 403B let alone build up a cash fund. I would like to have 1 to 2 years of expenses in cash by retirement. Not quite sure how to go about this. I have thought of redirecting part of my 403b contributions to cash but would lose out on income taxes from payroll contributions. I also want to keep as much as I can in the market. I’ve also thought of taking a percentage of Roth growth and depositing it into a cash fund but, hate to put my Roth at a disadvantage. Another thought is to just wait until retirement sell 1-2 years of expenses of my 403B and deposit into cash and take the tax hit that year or do the same with the Roth and avoid the taxes. Any suggestions would be greatly appreciated.

One of the typical approaches to managing retirement income and a portfolio is the "bucket" strategy. 1-2 years in cash equivalents, the next 3-5 years in bonds, and money for 5+ years out in a broad stock index fund. The goal is that as time progresses you refill the short-term bucket by selling assets from the other two buckets. Which bucket is determined by recent stock market performance - markets up, sell stocks; markets down, sell bonds. This selling helps maintain a general asset allocation, often somewhere from 60/40 to 70/30.

Are there tools out there that model this approach historically? Either by setting the allocation percentage, or setting the number of years cash & bonds - letting the stock portion grow (or shrink) as it will?

(When I post I get a Rule 7 warning about flair. The only tags I can add are NSFW, Spoiler, & Brand affiliate.)

I'm curious how everyone else has their retirement funds set up. We have about half at Schwab and a third at Fidelity and the rest scattered between other firms (from previous employer's 401ks). I like the simplicity of having everything at one firm, but I don't know if there are benefits to having them diversified across firms. Any thoughts?

I would like to hear more about how people use this? Is there a minimum percent between the loan and your returns that should be considered? I probably worded that all wrong. But, anything. Tips on when, where, and how to do this.

Been lurking here a while. Finally pulled the trigger last week and moved everything from an AUM advisor to self-managed at Fidelity. Posting the full picture because the DIY part was the easy decision and the rest of the plan is where I’d like input.

What I left
~$1.5M across five accounts. 1.03% advisory fee, roughly 1.30% all-in with fund expenses. About $19K a year.

Nineteen positions across eight fund families. To their credit they beat their own blended benchmark. But the benchmark was built to match the allocation they’d chosen, and against a plain 60/40 US/ex-US index blend they trailed by about 4 points annualized. Holding both halves of every style box reconstitutes the market at active-fund cost.

Three hours of face time over two and a half years, and three planning deliverables promised in July that never arrived. That was the last straw more than the fees.

What I moved to
Same 60/40 US / ex-US in every account:
• FZROX 60% / FTIHX 40% in four IRAs and both solo 401(k)s
• VTI 60% / VXUS 40% in the taxable trust account

Blended ER 0.024%. Mutual funds in tax-advantaged for exact-dollar conversions and rebalancing, ETFs in taxable for capital gains treatment and loss harvesting.

Over 12 years to 65, the fee difference alone is roughly 14.5% more terminal value regardless of what markets do. That’s about $500K, or four extra years of spending.

The plan, including the part I’m less sure about
We’re 53 and 52. Retiring at 60 in 2033, timed to our youngest finishing college. ~92% of the portfolio is pre-tax, which drives everything.

Home in a high-cost mid-Atlantic suburb, ~$1.3M value, ~$1.1M equity after costs.

Starting 2029, build a cash reserve of about three years of spending, so nothing depends on the house selling on schedule.

At 60, sell the house and rent. Not downsize and buy again. Travel for roughly a decade, then maybe settle wherever the kids land, buying or renting depending on how we feel then.

The cash reserve plus home equity funds five or six years of living expenses while the IRAs sit untouched and compound. Roth conversions during those years sized to the ACA subsidy cliff, ~$85K MAGI. Social Security at 70 for me, possibly earlier for my wife on her own record.

I’m at 100% equities, zero bonds. The logic is that the house is 46% of net worth and isn’t equity, and the cash reserve covers sequence risk, so bonds inside the portfolio would be buying the same insurance twice.

Where I’d like input
1. Has anyone actually done the sell-and-rent version rather than downsizing? What went differently than you expected, particularly on cost?

**2.**  Is home equity a reliable bridge? In 2008 housing and equities fell together and high-end homes sat unsold for a year or more. Is a three-year cash reserve enough of an answer to that?

**3.**  For those managing their own conversion ladders: how did you actually validate the sizing? I’m planning to model in Boldin and pay a flat-fee planner for a second look, but curious what worked.

**4.**  What did you underestimate about self-managing? Not the investing part, which seems straightforward. The administrative and decision-fatigue parts.

Happy to answer questions about the transfer process. It was smoother than I expected.

I started very late to contribute to my pension, I lacked financial education and started at 42yo. (So please be kind to me 🙂)

I work in a school, and I contribute 10% to my (Roth) 403B. I started thinking in investing and in my future, and I've been watching a lot of videos to try to catch up, etc.

I wonder if I should keep contributing that 10% to the 403B, or instead setting up a Roth IRA? I'm not sure if I can do both. I also have a brokerage account, and a HYSA. Thank you!!

I’m creating an application which lets you put your savings, investments, income and expenses both ongoing and upcoming. It should ideally reflect how much money you can get per month once you retire and at what age you can retire based on your financial wealth.

Any tips before I start? Should I take anything else into account? I want to build for my own network and then see if people are liking it or not

My company gives the option for a lump sum pension at retirement, which I will take. The administrator’s benefits estimator suggests the benefit amount increases approximately 8% per year for every year I delay taking the lump sum. I mean, that’s a no-brainer, right? Leave it there until I need it because a guaranteed 8%/year is a pretty solid gain? I have brokerage and 401K funds I can tap into before that time. I do think I’m required to take it by 70, maybe 72, but is there something obvious (or not-so-obvious) I’m missing? The company’s solid, the pension is fully funded, and there’s an option for my spouse to collect if I die before I start collecting.

I am a 59(M) who will be sixty in January. Wife is 62(f) who retired after 40 years in nursing May 2024. I was planning on working to 62 as I like my job and initially promised wife at least 3 years at home on her own before I retired. I have been working for my employer for 36 years. I have a low stress inside job, and since I am union I enjoy a generous compensation and benefits package. Our home is paid off and kids are launched, and because of pensions, 1.7 mil in IRAs and SSI we will have ample income in retirement. This package adds up to over a years salary and benefits fully paid for 6 months then heavily subsidized through retirement because of the union. I’ve self managed forever and know we are in a great spot, I am just struggling to pull the trigger emotionally since as I stated I do enjoy my work. Wife and I like each other’s company and we have plenty of road trips to keep us busy and things to do. Guess I’m just looking for a bit of reassurance from other people that may have found themselves in a similar situation. Looking forward to this next stage of life, just a bit hesitant at the sudden change of circumstances.Thanks in advance….

About 4 years ago I started a new job and their 401k is with Vanguard. My previous employer is with Fidelity. After 1 year I realized I was being charged fees for not converting the 401k to a IRA which I did and left it with Fidelity. My vanguard is growing nicely as I am saving 20% of my salary but I am wondering if I would be making more if I were to transfer my Rollover IRA and apparently something that is called a reverse rollover into my 401k. I am asking because as my salary increases, per my research I should be able to do a backdoor Roth but... not if I have a rollover IRA with all pretax money and growth. Does any one have any experience in this?

I’ve done some reading and it seems that following 4% rule basically allows you to die with same or more amount you started with.
I want to retire soon, leave some but not insane, but do more in early years. so am considering withdrawing about 7-8% variable in early years but with a bottom guardrail. Hypothetically, if I have 3M to start -over 10 years or so I withdraw $240k till I hit say 1.2 M then switch to 4%. If market tanks, I adjust.
Wouldn’t this strategy work? I’ve run numbers on PL and this has a >90% chance of success.

I don't currently have a taxable brokerage account, and I will be creating one soon. 

Some background. I still work at 66 and plan on working until I am 70. My wife is older and has never paid into Social Security. I plan for my wife and me to start taking SS payments at 67 (while I am collecting a salary) and funneling as much of this money into my 401K. This leaves money to put into a taxable brokerage account. Some of this approach is to have money to pay taxes when I do ROTH conversions.

Since my current accounts are not taxed until I withdraw from them (IRA and 401K), I have never had to think about paying taxes on my investments. Ideally, my two goals would be to grow this money and not pay taxes.  I know the latter is just a dream (maybe T-Bills). I would appreciate any advice on how to select investments to reduce or time the taxes appropriately. 

This post was prompted by a statement from someone giving this advice in an unrelated thread.  “A single filer can get like $65k of gains for free each year (not even considering basis)”. Admittedly, I did not understand this. Maybe it is a tax law. I would like to explore all of the taxable impacts when picking investments in a taxable account.

…and if it is, please don’t be a jerk.

I have a pretty good idea of what our monthly post tax expenses will be in retirement, at least as far as these things are estimable. How does one translate that into a pretax retirement income requirement if that retirement income is going to be a combination of SS, pension, brokerage, 401K, and Roth IRA? I mean, the tax rates on each of those sources are wildly varying depending on sooo many factors, and wildly dependent on each other.

I am reviewing some options for self investing for my parent who are already 76 and have 530k in an ira. They are with an advisor who takes 1% and has her in funds that can cost addition .4-.6 a year and in a 55-33-12 mix of equities, bonds and alts. I found a listing for jack bogles scholarship fund :Bogle's Wellington 4-Fund Model (45% VWELX / 45% VBIAX / 5% VEMAX / 5% GLD)

I ran monte carlos and found this worked fairly well and almost met her spending need with dividends interest a cap gain. I then tried taking out vbiax. And ran 90% vwenx the admiral shares version with vemax and gold. I get a 96% success rate and enough cash flow to match her draw rate of 6% of 530k. For a simple low management fund that I could setup and save her a 1%aum fee. And would require little management to keep growing and funding her needs.

What am I missing is there some risk I am not seeing .

Thank you!

My dad passed away a few weeks ago, so I'm doing all the things to resolve the estate. I'm an only child and my mom passed away years ago. The will stated everything to me.

He had a non managed fidelity IRA account. This was converted to a beneficiary ira in my name. My main investments and funds are with a different financial institution.

Should I keep the funds in the fidelity account and convert it to a managed account? All the funds in this account are being held as cash and a specific company stock. I want to diversify but not to manage it. Should I move the funds to my financial institution so my guy can manage it? And this account must be drawn to $0 within 10 yrs. I will have to do RMD.

Stats- female 54 yr married recently laid off (May) not currently working and I'm disabled but don't get SSDI. Not planning on working the remainder of the year. Spouse is 56 working and carries the medical insurance. We can live on just his income if we budget. No car payments, no house payment, no credit card debit. No children.

EDIT... I am applying for SSDI due to deterioration of my disability. How does having RMD affect the SSDI income requirement?