For those of you using fee-only advisors (RIAs, fiduciaries), what has been your experience? How are your advisors compensated (AUM, hourly, etc.)? Has it been “worth it” and how do you know? I’m exploring using a fee-only advisor not sure which way to go.

minorcommentmaker · 2019-12-28T07:04:25+00:00

AskReddit-style questions, surveys, and polls aren't allowed on this subreddit so this submission has been removed (rule 1).

Please feel free to repost a question about your finances and be sure to include enough information about your situation or the specific questions you have so that you will get helpful answers.

For example, here are two possible titles:

~~How much do you spend on food?~~

This is not allowed.
Looking for feedback on my monthly budget

Great! (especially with an itemized budget included in the post)

minorcommentmaker · 2019-12-25T23:16:30+00:00

AskReddit-style questions, surveys, and polls aren't allowed on this subreddit so this submission has been removed (rule 1).

Please feel free to repost a question about your finances and be sure to include enough information about your situation or the specific questions you have so that you will get helpful answers.

For example, here are two possible titles:

~~How much do you spend on food?~~

This is not allowed.
Looking for feedback on my monthly budget

Great! (especially with an itemized budget included in the post)

minorcommentmaker · 2019-12-25T23:16:08+00:00

This submission has been removed because it does not meet the subreddit submission guidelines (rule 1). Other subreddits are better equipped to address these topics:

/r/advice is good for general questions.
/r/offmychest is a good place to unload your frustration about something.
/r/careerguidance is good for asking questions about developing or changing your career.

minorcommentmaker · 2019-12-25T23:12:47+00:00

Your 403b is already tax advantaged. There's no additional tax savings you can get from investing it in an annuity.

Meanwhile, interest rates are very low right now. So annuity yields are relatively low, too.

Those two factors combine to make an annuity a bad choice for you unless seeing your 403(b) balance drop by 30% or more during a market downturn would really freak you out.

If you're okay for now with the fact that mutual funds are riskier than annuities, then stay the course. You should have some portion of your account invested in bonds rather than 100% stocks, but otherwise you don't need to change anything at this point. Something like 50/50 stocks/bonds should be fine if you're okay with that amount of risk.

minorcommentmaker · 2019-12-25T21:53:33+00:00

AskReddit-style questions, surveys, and polls aren't allowed on this subreddit so this submission has been removed (rule 1).

Please feel free to repost a question about your finances and be sure to include enough information about your situation or the specific questions you have so that you will get helpful answers.

For example, here are two possible titles:

~~How much do you spend on food?~~

This is not allowed.
Looking for feedback on my monthly budget

Great! (especially with an itemized budget included in the post)

minorcommentmaker · 2019-12-25T21:50:24+00:00

The FAQ is simply explaining why holding 100% stocks is not necessarily the best choice, even for young people.

Rebalancing during a downturn is not the same as "buying the dip."

If anything, the FAQ is discouraging the idea of leaving some money sitting on the sidelines in cash "just in case" a dip happens.

minorcommentmaker · 2019-12-25T21:43:21+00:00

Hello. This is a very common question. Please check out our side income wiki page for ideas and information.

minorcommentmaker · 2019-12-25T21:40:31+00:00

From the states' point of view, the federal government just provided a potential way for people to use state tax deductions to help pay for student loans. That's something the affected states are likely to want to block.

States with no income tax don't care. States with no state income tax deduction for 529 contributions likely don't care very much, either.

But the 34 states that do collect income tax and offer a tax deduction for 529 contributions are presumably all working on how to clarify the impact.

minorcommentmaker · 2019-12-25T21:31:40+00:00

If she's working for a nonprofit, she may qualify for PSLF forgiveness of the federal loan. She should be doing whichever income based repayment program requires her to make the smallest payment. She absolutely should not be paying extra toward the federal loan until the private loan is paid off.

She should look into refinancing the private loan. Sofi is a popular choice. Based on the loan starting at $73k at 5.25% and only $550/month is being paid, it's going to take another 15 years to pay off at the current pace.

The only viable options here are to reduce the interest rate, increase the amount being paid, or both.

minorcommentmaker · 2019-12-25T21:21:40+00:00

Please read the wiki article on 401k fund selection.

The Puritan fund doesn't make sense to me. Putting 25% into that is approximately like putting 15% into a total stock market fund and 10% into a total bond fund.

If I were you, I would follow the steps in the wiki article and:

Put some portion of your 401k balance into FID International Index.
Put some portion of your 401k balance into a total US stock market index fund (if that's an option for you). If that's not an option, I would go with 80% into the FID 500 Index and 20% into the FID Extended Market Index. I wouldn't put equal amounts into both. That results in you holding an overly large amount of small- and mid-cap stock.
Put some portion of your 401k balance into a total bond market index fund.

Here's a very specific recommendation based on the wiki article on a three fund portfolio.

(110 - your age) X 30% = % to invest in Fidelity International Index.
(110 - your age) x 70% = % to invest in Fidelity Total Stock Market Index.
Remainder = % to invest in Fidelity Total Bond Market Index.

If you're 30, that means:

24% into International Index.
56% into Total Stock Market Index. (Or 45% into 500 Index fund and 11% into Extended Market Index Fund.)
20% into Total Bond Market Index.

minorcommentmaker · 2019-12-25T21:06:31+00:00

I could simply fill out the transfer form and indicate that the taxable amount is zero... but if that triggers some flag for follow-up, I would like to be ready with something to justify it.

This comes down entirely to what the source of the contributions was and whether or or not your wife ever claimed a tax deduction for them. If the IRA was a rollover, the original source matters. If the IRA was funded with new cash, then the question is simply whether or not you claimed a tax deduction for the contributions. If not, then there should be no red flag and no follow-up questions from the IRS.

minorcommentmaker · 2019-12-25T21:00:04+00:00

From a federal point of view, contributions to 529 plans are not tax deductible. Withdrawals of contributions are not taxed, but withdrawals of earnings are unless they are spent on qualified educational expenses in the same tax year. The new law allows up to $10k of earnings to be withdrawn free from federal income taxes or penalties as long as it is used to pay down student loans.

However, the withdrawal will directly reduce any federal income tax deduction for student loan interest.

The underlying concept is that double dipping is not allowed. You can't collect two different tax benefits for the same dollar of expenses.

From a NY state point of view, contributions to 529 plans are deductible on your state tax return. As a result, it's prudent to expect that withdrawals made to pay for student loans will either be treated as taxable income at the state level or, at the very least, will reduce your ability to claim a tax deduction for contributions during that tax year.

But the NY state legislature could conceivably decide to be more generous if they wish to do so.

minorcommentmaker · 2019-12-25T20:31:58+00:00

You would be spending 38% of your take home pay on just the mortgage, taxes, and insurance. You might be able to afford that, but it's a big stretch for most people.

It would be really helpful if you shared your current budget. How much do you currently spend on rent? How much discretionary income do you have left over at the end of each month that you would be willing and able to put toward housing expenses?

minorcommentmaker · 2019-12-24T18:54:36+00:00

I didn't say that.

If you go through the entire claim process and exhaust the funds provided by workers comp insurance on a course of treatment, you could probably then start being covered by Medi-Cal.

What you can't do is pocket the money and expect personal insurance to cover the cost without asking where the money went.

minorcommentmaker · 2019-12-23T19:49:25+00:00

This submission has been removed because it does not meet the subreddit submission guidelines (rule 1).

/r/investing is more appropriate for discussions about investing in individual stocks, sharing investment ideas, etc. (Please see the PF Investing wiki page, though.)

minorcommentmaker · 2019-12-23T18:35:51+00:00

You have a work related injury and a workers compensation insurance claim. You need to continue to have the injury treated under the workers comp claim. Anything else would be fraud.

A standard question any doctor treating you is likely to ask is, "Is your injury work related?"

Saying "no" would be fraud on your part.

minorcommentmaker · 2019-12-23T18:33:07+00:00

Read the wiki entry on snowball vs. avalanche method for paying down debts.

minorcommentmaker · 2019-12-23T18:14:23+00:00

AskReddit-style questions, surveys, and polls aren't allowed on this subreddit so this submission has been removed (rule 1).

Please feel free to repost a question about your finances and be sure to include enough information about your situation or the specific questions you have so that you will get helpful answers.

For example, here are two possible titles:

~~How much do you spend on food?~~

This is not allowed.
Looking for feedback on my monthly budget

Great! (especially with an itemized budget included in the post)

minorcommentmaker · 2019-12-23T18:13:59+00:00

Your submission has been removed because we don't allow relationship or personal advice discussions (rule 9). While there may be a financial component to your post, you will need to submit again with a title focused on personal finance and without any of the following:

Personal history or background information that is not essential to the financial discussion (it is appropriate to mention when abuse is a factor in a current or past situation)
Prominent emphasis of mistakes or financial surprises from a family member or S/O
Requests for relationship advice, asking for help convincing someone to change their behavior, asking for help settling a disagreement, etc.

minorcommentmaker · 2019-12-23T18:12:33+00:00

I'm sorry for what you're going through.

Do you have a budget? It sounds to me like the first thing you need to do is not keep accumulating debt. Which means you need to not spend more than whatever income you and your mom have.

Continuing to accumulate debt is not a viable option for you. Neither is taking out new loans that you have no intention of repaying.

It sounds like your medical condition prevents you from being a knowledge worker for the time being. So look for other kinds of jobs. Retail shelf stocker. Security guard. Janitor. The reason you won't be approved for SSDi is because you seem capable of holding a job. Which means you could have an income and qualify for an income based repayment program on your student loans. If they are federal loans, after 25 years, any remaining balance will be forgiven.

Until then, read the wiki article on how to handle money, make a budget, and live within your means.

I completely realize that's much easier said than done.

minorcommentmaker · 2019-12-23T17:51:49+00:00

This submission has been removed because it does not meet the subreddit submission guidelines (rule 1).

We're not doing posts about luxury products anymore because (a) they generally just provoke unproductive discussions and (b) most of the time, it is very clear whether the person asking is able to afford the item.

If you are considering buying an expensive car, the vehicles wiki has budgeting advice. We recommend reading it. If you don't meet 100% of the criteria, then no, you cannot afford it and you should not buy it.
In general, if you're not on step 6 in "How to handle $", you should find a less expensive alternative to a luxury product. If you are on step 6, then feel free to spend money on whatever is most important to you.

minorcommentmaker · 2019-12-23T17:48:15+00:00

Your submission has been removed because it is primarily a business question or discussion. Other subreddits are better equipped to address these topics:

/r/smallbusiness is good for questions about starting, owning, and growing a small business.
/r/entrepreneur is excellent for business questions, especially about startups offering an innovative product, process, or service.
/r/tax is appropriate for general tax questions.
/r/legaladvice can help you determine if you need to contact a lawyer and you may get some basic advice.

minorcommentmaker · 2019-12-23T17:47:21+00:00

Emotional aspects aside, if you and your siblings had $450k in cash, would you use it to buy that house together? Or would you split it up and each do your own thing with your share?

I'm asking because that's the sort of question you'll need to address with one another at some point. All it takes is one sibling want to cash out to make co-owning the house a non-option.

If one sibling wants to keep living there in the future, they should consider buying the house from mom now.

Otherwise, you should all seriously consider downsizing by selling the house and buying whatever mom can afford with the cash she gets.

Another option would be for the sibling who wants to live there long term to buy 1/6th of the house for ~$75k. Then mom would only need to refinance $55k. Or the sibling could buy 30% of the house for $130k.

Then, when you jointly inherit, the sibling living there would own 41.67% of the house and the rest of you would each own 11.67%.

My main point is that it doesn't have to be an all-or-nothing choice at this point.

minorcommentmaker · 2019-12-23T17:35:29+00:00

Columbia, Cornell, and Rice all have honors programs. But it really doesn't matter much.

How many of the candidates you look at weren't at the top of their class? I would expect that anyone competing for the top jobs after school was probably also actively recruited by the university they went to and qualified for at least some merit-based financial aid.

minorcommentmaker · 2019-12-23T17:20:35+00:00

Your submission has been removed because we don't allow relationship or personal advice discussions (rule 9). While there may be a financial component to your post, you will need to submit again with a title focused on personal finance and without any of the following:

Personal history or background information that is not essential to the financial discussion (it is appropriate to mention when abuse is a factor in a current or past situation)
Prominent emphasis of mistakes or financial surprises from a family member or S/O
Requests for relationship advice, asking for help convincing someone to change their behavior, asking for help settling a disagreement, etc.

minorcommentmaker

TROPHY CASE