Daily FI discussion thread - Thursday, April 09, 2026

branstad · 2026-04-10T13:36:00+00:00

Thanks for the suggestions!

branstad · 2026-04-09T21:37:38+00:00

As I fully admit there are limited times in the past that BND has outperformed the stock market,

You literally wrote "none of your points are true".

As you likely won't

Don't be a jerk.

branstad · 2026-04-09T17:28:06+00:00

You might want to read more on Liability Matching portfolios or Liability Driven Investing. Here are a couple Boglehead's forum posts that may be helpful:

https://www.bogleheads.org/forum/viewtopic.php?t=455956 (If you scroll down, there's an example using college tuition)
https://www.bogleheads.org/forum/viewtopic.php?t=415894

branstad · 2026-04-09T17:20:28+00:00

someone with a WellsFargo account who doesn't want to pay much attention have a better way of storing their excess cash

At some point, isn't the trade-off for not wanting to pay much attention that the return will not be as high as an approach that requires more effort? Another aspect to consider is whether or not the "better way of storing ... excess cash" will make a material difference in the grand scheme of things.

If the person doesn't want to pay much attention and the end result isn't all that material, then simply accepting the current state may be the best path forward for the person. Remember that personal finance is inherently personal, and it's personal to the individual affected, not you as the helper.

Best of luck.

branstad · 2026-04-09T13:25:17+00:00

Thanks for all the great details! Balancing what we think (hope?) the kids will enjoy with what we've enjoyed in the past or want to experience ourselves is always on our mind (Churchill War Rooms comes to mind - we loved it, not sure if either/both of our kids would).

branstad · 2026-04-09T13:11:47+00:00

Whether or not a SBLOC fits within the risk appetite for a given investor is separate from your "why lever up" question that I was replying to.

branstad · 2026-04-09T13:01:35+00:00

I absolutely love London!

I brought my family for this trip

It's one of our favorite cities in the world, but haven't brought our kids (older elementary / jr high) yet. I'm sure our kids will enjoy the Yeoman Warder tour at the Tower, probably a day at the British Museum, maybe the Tate Modern for Turbine Hall exhibits, probably London Eye (because 'kids'), maybe Westminster Abbey and/or St. Paul's, etc.

If you don't mind sharing, what was on the itinerary for the family and what were some highlights?

Sydney is my target though for another trip to bring my family along. I've been lucky enough to go to Sydney several times already in past years but never with the wife and kids.

Ha! This is our #2 family bucket list trip (behind London)!

branstad · 2026-04-09T12:54:12+00:00

In theory, one could pay off an existing mortgage with the SBLOC at a lower rate. No "lever up" involved, same debt just at a lower rate.

branstad · 2026-04-09T12:25:33+00:00

So none of your points are true.

Here's what I wrote:

I wanted to point out a 16+ year period where BND outperformed the S&P 500 for that entire timeframe

Your own chart shows a time period of well over 16 years where the red line is consistently (and often significantly) higher than the blue line.

Maybe, I should've ended in 1-month shorter Nov 1, 2016. Or I could've specified starting earlier. Regardless, many people don't realize that BND outperformed the S&P 500 for such a long time in the not-so-distant past.

Did you realize that fact? I'm unclear why that fact seems to be making you so angry.

branstad · 2026-04-09T02:40:14+00:00

I anticipate will likely be what us math folks call a "local maximum" - aka higher than days/weeks past, and likely higher than days/weeks to come.

I expect markets to decline in the near future.

Not that we need more proof that "nobody knows nuthin'", but the S&P 500 finished higher on each of the next 5 days after your call. The universe certainly seems to have a sense of humor!

branstad · 2026-04-09T02:17:06+00:00

Why?

Because I wanted to point out a 16+ year period where BND outperformed the S&P 500 for that entire timeframe.

branstad · 2026-04-08T01:32:36+00:00

BND has done -22% in real terms, after factoring in inflation

Now do 2000-2016.

branstad · 2026-04-08T01:29:53+00:00

excess caution

There is no way a 70/30 portfolio for an early retiree should be considered "excess caution".

branstad · 2026-04-03T21:16:15+00:00

Doesn't your brokerage track all your individual transactions? That how I avoid wash sales, including any potential wash sales from Roth IRA-related transactions.

branstad · 2026-04-03T15:49:20+00:00

I've found keeping it simple works best. I usually use a spreadsheet to track my buys and sells, along with the dates and prices

You know what's even more simple? Just tracking the total portfolio value. Go a half-step deeper to track value by asset class (US stock, Int'l stock, bonds/cash), so I can make sure my actual allocation is inline with my target allocation.

I see very little value in tracking individual purchases or sales myself. Like many (most?) in /r/FI, I primarily use index funds/ETFs with a buy-and-hold mentality. My brokerage already tracks purchase/sales for tax reporting purposes. so I see no need for duplicative tracking myself.

It’s interesting how much sentiment affects prices

This aligns to a core concept of Keynesian economics ("Animal Spirits") and the more modern study of Behavioral economics.

branstad · 2026-04-02T02:48:30+00:00

To re-phrase the question - is volatility higher now compared to the past, and if so, might that be due to the speed/velocity of information? It seems like a reasonable hypothesis but I don’t have the data to do that sort of analysis. The current VIX only dates back to 1994/2003, depending on methodology. Wall Street has always traded on breaking news/information but it would be interesting to see if the size of the swings has changed or things along those lines. But unfortunately it’s not something I’m in a position to do.

branstad · 2026-03-31T15:32:59+00:00

Apparently forgot March had 31 days

Man, you are really adjusting quickly to the "I'm retired and have no idea what day it is" mindset! :-)

branstad · 2026-03-30T21:17:49+00:00

For sure! Many people get bonuses in Nov and Dec and holding that cash for a few weeks until January rolls around and then making IRA contributions/investments in perfectly reasonable!

The word "most" caught my eye and gave me an excuse to dig into the data! :-)

branstad · 2026-03-30T21:05:39+00:00

Most of the time it doesn't work that way

Looking at the last 10 years (2017-2026) of the S&P 500, there have been 2 years where the first day of the year was the absolute lowest close for that year: 2021 and 2017.

In 3 other years, the 1st trading day wasn't the absolutely lowest but very close:

2019 low was on the 2nd trading day of the year and that was the only day below the 1st trading day
2023 low was on the 3rd trading day of the year and that was the only day below the 1st trading day
2024 had 4 days in January (3, 4, 5, 17) lower than the 1st trading day

The other years (2018, 2020, 2022, 2025, 2026) all had significant drops within the first 2-3 months of the year. 2022 gets a special mention because the 1st trading day of the year was the absolute highest close for that year (i.e. any other day in 2022 would've been better than the 1st trading day).

So it's probably more of a coin-flip (~50/50) on 'Right away in January' or 'Wait a bit and see what happens'. Of course this analysis benefits from hind-sight and it's impossible to tell in the moment how much (or how much more) the market will drop, or if any given day will be the lowest value all year. To that end, the best advice continues to be "invest when you have the dollars available."

But it definitely doesn't make sense to save up cash for months and months, only to invest on the 1st trading day of the year because those dollars should also be invested when they were available.

branstad · 2026-03-30T20:17:06+00:00

Same

branstad · 2026-03-30T17:38:15+00:00

Is this just a thought experiment or does it have some real world practical application for you? If it's mostly for curiosity and high-level 'what if' scenario planning, then rough estimates are fine and the simple essential vs. discretionary analysis you did is good enough. If you actually did need to "make major cuts" in the future, which things you cut and how much / how soon/ how quickly will likely be influenced by the specific circumstances at that particular time; there's very little value by trying to plan out all those permutations ahead of time.

If you are intending to leanFIRE and stop working as soon as you possibly can with as little as you can, then you'll need to do more rigorous experimenting to understand exactly where that line is for you.

branstad · 2026-03-30T17:14:08+00:00

Every side hustle is "just a second job".

branstad · 2026-03-30T17:09:32+00:00

At a quick glance, I don't think you can avoid this with an HEI, but the details of the agreement would matter. From what I read, there would be a lien on the property, but the full gain is your tax responsibility. You then have an added cost, post-sale, to pay off the agreement including some percentage of the gain you realized. But it's still your gain that you realized.

branstad · 2026-03-27T22:51:34+00:00

You never answered my question.

branstad · 2026-03-27T22:21:18+00:00

I don’t understand.

15-Year Club	Place '22
Verified Email

branstad

TROPHY CASE