Personal finance

[Baron S]

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I'm not sure if this would be better off in the private forum but it could certainly be moved if needed.

I wanted to make a thread to discuss personal finance issues. Retirement, investing, real estate, etc. Hopefully our shared knowledge and experiences can benefit one another and help us reach our goals.

 

[Baron S]

I've been reading a fair amount about Municipal Bond Funds. Common adage is to carry at least some bonds and build on them as we get closer and closer to retirement. I'm starting to get more grey hairs so am looking at diversifying my equity-heavy portfolio.

I carry some corporate bonds in tax advantaged accounts but feel it's time to add some to my general investing brokerage account. One appealing option is municipal bond funds.

The big advantage is that, in exchange for lower yields, dividends are exempt from federal tax (and sometimes state) income tax. This tax savings can sometimes make the tax equivalent yield higher than corporate bonds.

Anyone have any experience with these types of investments?

 

[mdo1738]

I've been reading a fair amount about Municipal Bond Funds. Common adage is to carry at least some bonds and build on them as we get closer and closer to retirement. I'm starting to get more grey hairs so am looking at diversifying my equity-heavy portfolio.

I carry some corporate bonds in tax advantaged accounts but feel it's time to add some to my general investing brokerage account. One appealing option is municipal bond funds.

The big advantage is that, in exchange for lower yields, dividends are exempt from federal tax (and sometimes state) income tax. This tax savings can sometimes make the tax equivalent yield higher than corporate bonds.

Anyone have any experience with these types of investments?

Yeah I kept a big chunk in MBFs and plain municipal bonds for a year a couple years ago. I forget the exact numbers, but it did ok, and the tax advantage was nice. For those who are at the point where adding bonds makes sense, they’re a great option. It is certainly a lower ceiling investment, but very low risk, with a minuscule rate of defaults.

 

[Baron S]

Yeah I kept a big chunk in MBFs and plain municipal bonds for a year a couple years ago. I forget the exact numbers, but it did ok, and the tax advantage was nice. For those who are at the point where adding bonds makes sense, they’re a great option. It is certainly a lower ceiling investment, but very low risk, with a minuscule rate of defaults.

Did you find any advantage of doing individual munis over the MBF other than being able to shop for a higher coupon rate?

 

[pastafan]

This is useful when evaluation munis Tax-Equivalent Yield Calculator | Eaton Vance

I am moving from a non-income tax state to one with tax I will be looking into munis more. My reading recommends individual bonds vs a fund due to management charges. I have been advised by an attorney who manages hundreds of millions that AA rated or better are safe investments.

 

[SpineandWine]

I think two things will likely help finances the most
- avoiding divorce
- saving a percentage of your income - like ~20%

 

[clubdeac]

Just sock away 2-300k/yr and put 70% in stocks and the rest in bonds and or high yield savings accounts or money market accounts

 

[BobBarker]

that is a lot of saving. Your estate would be huge. No way to spend that amount in retirement.

 

[CleanUp]

that is a lot of saving. Your estate would be huge. No way to spend that amount in retirement.

Don’t tempt me like that, Bob.

 

[BobBarker]

Hey the math is the math. It gives $8m in a taxable account and would generate $520,000 or so in annual dividends and growth. You would never touch the principal in retirement.

 

[hyperalgesia]

Remember to cultivate other interests for enjoyment and eventual retirement. It's not all about money.

 

[cowboydoc]

Remember to cultivate other interests for enjoyment and eventual retirement. It's not all about money.

Truth! Treated a 73 yo FP today headed back to the clinic 2-3 days a week because he doesn’t have anything else to do. Don’t think financially he has any need to, just bored.

 

[cowboydoc]

that is a lot of saving. Your estate would be huge. No way to spend that amount in retirement.

Spoken like a guy that was never introduced to hookers and blow.

 

[Baron S]

What are our moves? Concerning CPI report out.

 

[SSdoc33]

View attachment 398743

What are our moves? Concerning CPI report out.

interest rates now being cut anytime soon. probably more likely to go back up

 

[Baron S]

interest rates now being cut anytime soon. probably more likely to go back up

Yeah, quite disappointed as I was hoping for a mortgage refinance.

 

[SSdoc33]

Yeah, quite disappointed as I was hoping for a mortgage refinance.

no, you can still refinance. in 2029. maybe

 

[pastafan]

I've been reading a fair amount about Municipal Bond Funds. Common adage is to carry at least some bonds and build on them as we get closer and closer to retirement. I'm starting to get more grey hairs so am looking at diversifying my equity-heavy portfolio.

I carry some corporate bonds in tax advantaged accounts but feel it's time to add some to my general investing brokerage account. One appealing option is municipal bond funds.

The big advantage is that, in exchange for lower yields, dividends are exempt from federal tax (and sometimes state) income tax. This tax savings can sometimes make the tax equivalent yield higher than corporate bonds.

Anyone have any experience with these types of investments?

View attachment 398743

What are our moves? Concerning CPI report out.

This is why I've stayed in money market and not purchased T bills in a while.

 

[LaminaV]

Buys TSLA at $350 and sit on it …
Made a lot on Tesla since 2020.

 

[Baron S]

Buys TSLA at $350 and sit on it …
Made a lot on Tesla since 2020.

I'll never short TSLA, but it's really hard to justify it's valuation. Any company that's one MI from tanking is a no-buy for me.

 

[BobBarker]

If you own your own practice you have to, have to, have to set up a cash balance pension plan. I put over $200k a year in mine.

 

[rexed]

If you own your own practice you have to, have to, have to set up a cash balance pension plan. I put over $200k a year in mine.

Same. As much as I hate paying the additional fees for maintaining the plans, it's a must.

 

[SpineandWine]

Same. As much as I hate paying the additional fees for maintaining the plans, it's a must.

We got rid of ours because they were taking 15k per participant.
15kx20 weee our fees…. 300k for the plan for 20 docs.
Not worth it. Now that we got rid of it, I wonder if I can convince them to instill it again with different vendor

 

[BobBarker]

The fees are a huge scam. They are just using actuarial life expectancy tables and then looking at the plans performance to tell you how much to put in. Our plans goal is to be maximally funded the day we retire. Only two employees, myself and my wife.

 

[lobelsteve]

SOS. Thx.
457
403
Pension

 

[strike5858]

The fees are a huge scam. They are just using actuarial life expectancy tables and then looking at the plans performance to tell you how much to put in. Our plans goal is to be maximally funded the day we retire. Only two employees, myself and my wife.

Who are you using to set this up?

 

[BobBarker]

we used futureplan and switched to LRS.

 

[Status Sciaticus]

If you own your own practice you have to, have to, have to set up a cash balance pension plan. I put over $200k a year in mine.

Same. As much as I hate paying the additional fees for maintaining the plans, it's a must.

what are the fees yall are paying?

 

[strike5858]

obviously it must pencil out since you guys are doing it but just wanted to get an idea of what kinda premium I should expect to pay a company to lease my employees from them and also the costs/fees associated with setting up the CBP.

 

[BobBarker]

I don’t know. We are to small to offer benefits otherwise so I didn’t have much of a choice.

 

[BobBarker]

The fees on the CB plan are incessant. Probably about $5000 a year.

 

[rexed]

what are the fees yall are paying?

I think the last time I checked it was around 10-12k (+ fees increase as the plan grows).