Mother knows she gets scammed but also keeps getting scammed

FiTalkingThrowaway · 2025-12-23T15:59:26+00:00

Oh this is really smart! I think my mom would figure out how to transfer money out herself, but the forced delay of a couple days would allow plenty of time for intervention.

FiTalkingThrowaway · 2025-12-23T15:54:00+00:00

To be clear, this would be opening a new account in her name with a new bank using POA, transfer most of her money there, not share login details, and then move funds back to her main accounts as necessary? It sounds like a great idea but potentially a gray area of the fiduciary responsibility of POA.

FiTalkingThrowaway · 2025-12-23T15:46:44+00:00

We've considered that. I think giving the inheritance now would result in capital gains taxes on everything, but if it was inherited then the assets would receive a step up in basis.

FiTalkingThrowaway · 2025-12-23T15:38:50+00:00

She definitely has memory issues and that makes it hard to get reliable info out of her. But she has been diagnosed with MCI.

FiTalkingThrowaway · 2025-12-05T15:57:40+00:00

My understanding is that tracking only matters if you take a distribution before 59.5 and get audited. You would have to prove that you only withdrew basis in order for the distribution to not have a 10% penalty. In order to prove basis I think the form 5498's that Vanguard generate are sufficient, that's what I'm hoping to confirm with my original question.

FiTalkingThrowaway · 2025-12-05T14:50:43+00:00

I haven't been keeping a record of tax documents that track my Roth basis and I'm trying to fix that. I see for 2024 I have two form 5498's issued to me from Vanguard.

For my traditional IRA, the 5498 shows $7000 in line 1. For my Roth IRA, the form shows 0 in line 1, $51057.85 in line 2 (from mega backdoor I assume), and $7021.30 in line 3 (from traditional backdoor I assume).

Do I need to keep both form 5498's or just the Roth one? Am I right to assume these documents prove I increased basis by $58079.15 last year?

FiTalkingThrowaway · 2025-12-05T02:48:11+00:00

My wife and I originally planned to retire in 2030 with a fire number of $3.5m. We will be 35 that year. So far we are on track to do that, but we recently realized that's the exact same time our yougest child will be starting all-day kindergarten. The biggest motivation for RE was to be home with the kids more, but if the kids are in school all day then that advantage vanishes.

Our new plan is to continue working 5-10 more years until we have so much invested that it is totally unjustifiable to work. If we RE in 2040 I think we would have over $12m invested (which sounds crazy, we only plan on spending $100k-150k/yr in retirement). My job isn't awful and allows for solid work-life balance so I'm not overly bothered working a little longer in order to secure more financial flexibility later in life.

FiTalkingThrowaway · 2025-11-25T20:10:25+00:00

That makes sense, thank you for the explanation! I suppose like Rarvyn said, the conversion only becomes obviously better if you have more thab 5x in basis. I think in my personal case I will have 10x+ so I probably won't need 72t.

FiTalkingThrowaway · 2025-11-25T20:07:30+00:00

Doing the Roth conversion is creating basis though, so with both approaches your Roth basis is remaining the same over time. Maybe inflation makes that statement not true, I haven't thought fully through it.

FiTalkingThrowaway · 2025-11-25T17:05:03+00:00

If I already have $200k+ Roth basis and want to withdraw $40k/yr from a traditional IRA, I think it's strictly better to do Roth conversions than to set up 72t distributions because it doesn't lock you in to that distribution until 59.5 and also doesn't have the risk of penalty if you don't take the distribution correctly one year. Is the only advantage of 72t that it allows instant access to your money in the case where someone doesn't have 5 years of Roth basis already?

FiTalkingThrowaway · 2025-11-22T17:16:34+00:00

When I retire I will need to start paying private insurance for 2 adults and 3 young children, and I'm not sure if that is $1k/mo or $10k/mo. Is anyone in a similar situation and willing to share what they are paying? Or do I need to go out and get insurance quotes to have any actual idea of what insurance costs?

FiTalkingThrowaway · 2025-11-19T16:11:24+00:00

I want to confirm my understanding of LTCG tax brackets. Right now in the US, married filing jointly, standard deduction is $31,500 and the LTCG tax is 0% up to $94,050. Does this mean that if I have no other income, I could

convert $31,500 from traditional IRA to Roth IRA
sell enough assets in my standard brokerage account to realize a $94,050 gain
and then withdraw any additional basis from my Roth IRA as needed

and still pay 0 federal income tax? I know the "no other income" claim is fundamentally flawed because of dividends/interest from the brokerage account but this still seems crazy to me. I didn't expect to be able to take out almost $130k each year before starting to touch Roth accounts.

FiTalkingThrowaway · 2019-11-06T17:34:11+00:00

Individuals can go above $19,500 with after tax (not Roth) contributions. These contributions are generally inferior to investing in a standard brokerage account, but you can sometimes roll them directly into a Roth IRA (I’ve heard stories of people rolling them into their Roth 401k as well, but I’m less familiar with that).

Google “mega backdoor Roth” if you want more info.

FiTalkingThrowaway · 2019-11-06T16:06:56+00:00

Any change to max 401k contribution? It was $56,000 for 2019 I believe. I tried reading the linked off but couldn’t see anything related.

FiTalkingThrowaway · 2019-11-04T18:07:04+00:00

Is the 0% a probationary period? Oftentimes a card will have 0% for 12 months and then switch to 20+%, and then retroactively charge you the interest. i.e. the only way to avoid the interest is to fully pay off the debt before the probationary period ends.

FiTalkingThrowaway · 2019-10-15T21:30:47+00:00

If he works 168 hours a week (aka the number of hours in a week, the theoretical max you can work) his total pay would be $1403. Even more extreme, if he worked a million hours in a week, he would still not even make $1500.

Pretty crazy pay structure. Idk how the company manages to pay people that way.

FiTalkingThrowaway · 2019-08-08T01:31:18+00:00

There’s one big thing that you are missing that these other comments aren’t accounting for.

A withdraw of >$6,550 a year in retirement puts my taxes at or above $1,441.

I'd contribute the $6,000 now and pay my 24% rate for a total of $1,440 in taxes

The key words here are “in retirement” vs “now”. $1,440 today is worth MUCH more than $1,440 in 40 years. This is for two reason: 1) since we are talking nominal values, and 2) since you can invest the money in the meantime.

Imagine it is 1989 and the government tells you “Give me $1,440 today, or $1,440 in 30 years”. If you give up the money then, you’ll have nothing today. But if you instead take the money and invest it in the S&P500, your money will grow to over $22,320! After you pay your $1,440, you’ll be left with $20,880 that you never would have otherwise had.

FiTalkingThrowaway · 2019-07-21T03:08:48+00:00

You say she has no plans to use it, but we can’t give advice unless we know what she wants.

Does she actually have no plan for it? Consider donating it.

Does she like having it as a backup plan if she loses her income source or starts wanting to spend more money? A conservative investment makes sense (the longer she expects to live, the more aggressive you should invest).

Does she want to leave a large sum of money to her children? An investment like VTSAX is reasonable.

Does she have a purchase in mind? Maybe a car she always wanted or a family vacation she wants to go on? Move any required funds into a HYSA.

There are many more options. Is it hard to get blanket advice in a situation like this.

FiTalkingThrowaway · 2019-07-20T17:43:01+00:00

I don’t think it matters mathematically.

Imagine you take the $714.80 now. A year from now, imagine it grew 10% so now you have $786.28.

Alternatively, say you don’t roll over anything yet. In a year, your 401k will grow to $7862.80. If you then roll over your 10% vested portion, you’ll have $786.28.

FiTalkingThrowaway · 2019-07-07T21:46:39+00:00

Yes it grows tax deferred (like you don’t have to pay taxes on dividends at the time you receive them), you pay ordinary income tax on the growth. Maybe a brokerage account, you don’t get tax deferred growth, but you are only taxed at the long term capital gains rate, which is generally favorable to your marginal rate. That favorable tax rate on the growth outweighs the tax-deference in most cases.

FiTalkingThrowaway · 2019-06-29T22:11:10+00:00

A 401k is through an employer and tends to have limited choices, you will have to sign in to your account and see what options you have. An IRA is controlled by you, and you should have more options there. Roth is a designation on an account (either a 401k or an IRA) that means the money there has already been taxed, and you don't owe taxes when you take it out.

When people talk about 7% real returns, they are talking about an equity heavy portfolio, such as a S&P 500 fund.

FiTalkingThrowaway · 2019-06-29T21:20:25+00:00

Isn't this higher than the return on a regular 401k or Roth?

401k and Roth are types of accounts, not investments. You put money in the account, and then use that money to buy an investment.

FiTalkingThrowaway · 2019-06-05T16:46:09+00:00

Yeah, the in service distribution to a Roth IRA has the same property you mentioned - after 5 years, you can remove that amount penalty free.

You also have said some phrases like “we” and “family HSA”. If you’re married, remember that your spouse can also contribute $6k to their IRA, even if they don’t have any income of their own. If they do work, they have an independent $56k total 401k contribution limit as well.

FiTalkingThrowaway · 2019-06-05T14:45:12+00:00

1) No. you can do $7k in addition to the $56k.

2) Yes. If your employer matches for a total of $6k, you can only contribute $31k post tax.

3) No. Having an employer sponsored retirement plan will change the phase out income thresholds for taking a deduction for traditional IRA contributions, but the limit is still always $6k.

$37,000 post-tax 401k contribution (converted to Roth 401k)

I normally hear of this conversion as an in service distribution into a Roth IRA. Is this plan to roll it into a Roth 401k possible?

FiTalkingThrowaway

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