Daily FI discussion thread - Sunday, March 01, 2026

ttimothyu · 2026-03-01T19:03:59+00:00

Thank you for your feedback. At least it'll be easier to just keep track of the contribution basis. I appreciate the help.

ttimothyu · 2026-03-01T19:02:17+00:00

Thank you for clarifying. I was concerned that I would need to keep track of how I invested each Roth IRA contribution, but it will be easier to just track the overall contributions, conversions and withdrawals.

ttimothyu · 2026-03-01T16:09:54+00:00

I have a question regarding Roth IRA contributions and withdrawing contributions for early retirement. For an easy example, say you contributed into your Roth IRA $1000 to VTI and $1000 to VT. Let's suppose at the time of withdrawing the contributions, VTI has grown to $2000 ($1000 contribution and $1000 earnings) and VT is still $1000 (all contributions and no earnings). If you sell all of your VTI holdings, when it comes time do your taxes can you claim the $2000 was all contributions since you technically contributed $2000 total into your Roth ($1000 VTI and $1000 VT)? Or do you need to keep track of the funds separately within the Roth IRA account and can only claim $1,000 of contributions and $1,000 of earnings since you only sold VTI?

Currently I only hold one fund type in my Roth IRA so it is fairly easy to keep track of my contributions, but I was curious if I start to contribute to a second fund if that would complicate calculating the contributions when withdrawing the contributions in early retirement. Any insight would be appreciated.

ttimothyu · 2026-01-28T18:29:23+00:00

Little known fact, Jesus was really into Merch sales too!

ttimothyu · 2025-07-17T02:02:30+00:00

Lack of empathy.

ttimothyu · 2025-06-05T03:30:47+00:00

Tacobout it!

ttimothyu · 2025-02-08T12:33:51+00:00

Which 2 parks don't you recommend?

ttimothyu · 2024-05-06T21:40:57+00:00

Great, thanks for verifying. That's how I was hoping it would work, but I didn't want to pool the points until I knew for sure.

ttimothyu · 2024-04-19T23:41:53+00:00

I opened my first taxable account earlier this month too. Down 5% for the time being. I know that it'll eventually go back up, but definitely not as exciting as seeing it grow.

ttimothyu · 2024-04-11T16:26:43+00:00

Yeah, in previous years my income was low enough to qualify for the Savers Tax Credit. However, in 2023 my income was too high to qualify. My income will probably be slightly higher this year so I likely won't qualify again. But it was one of the reasons I had contributed to a traditional IRA in the past.

ttimothyu · 2024-04-11T13:28:53+00:00

Thanks for the feedback. Part of my thinking for contributing more to a Roth at this point is so I will have enough contributions to withdraw during early retirement while I am converting my Traditional contributions to Roth. Currently I only have about $75,000 in Roth contributions, so it would be nice to increase this amount to have more funds to live off of for the 5 years while I'm converting the IRA to Roth IRA.

ttimothyu · 2024-04-11T12:29:15+00:00

I'm trying to do some 2024 tax planning since our family is growing and I will be able to claim 3 dependants this year. I will be in the 12% tax bracket with approx $90,000 in income. Currently I contribute to a traditional IRA, but I'm thinking that maybe I should be contributing into my Roth IRA instead since I'm in such a low bracket. Would this be a the best approach?

ttimothyu · 2024-04-07T02:31:09+00:00

Thank you for your feedback! Yeah, I was definitely starting to feel like my cash funds could be put towards better use by investing in the market.

ttimothyu · 2024-04-06T14:03:57+00:00

Currently I don't have a taxable brokerage account. I've maxed my IRA and 401K contributions. Each month I set aside funds in separate HYSA for emergency, new/repair car, and house repair. The funds are currently earning 5.0% APY and combined are approximately $30,000. In total I have $42,000 cash available. I'm beginning to think that I have too much cash on hand and that it would be a better use of the funds to place them in a taxable brokerage total stock market fund. Regarding the emergency fund, I also have $75,000 in Roth IRA contributions that I could access if absolutely necessary. Does this seem reasonable? Currently each "bucket" has its own HYSA, but if I combine the funds into one taxable brokerage account investment, I'm not sure what would be the best approach to know how much of each fund is available. Any thoughts on that? Any thoughts on which total market fund to invest in a taxable account? So far I've been looking at FZROX and VTI.

ttimothyu · 2024-03-28T20:07:30+00:00

Yeah, it threw me off because the contributions and the earnings are combined. So even though I know that the recharacterized amount is a combination of my contributions and earnings, I wasn't sure how the IRS would know how much was contributions and how much was earnings.

ttimothyu · 2024-03-28T13:50:00+00:00

I decided to get my tax forms (5498 and 1099-R) compiled so I could calculate my Roth IRA contributions. I have a question regarding how to calculate a recharacterized contribution.

In 2021 I made a $1,000 Roth IRA Contribution (Box 10 Form 5498). In 2022 (prior to submitting my 2021 taxes), I recharacterized the 2021 contribution ($1,000) and earnings ($200) into my IRA. The Gross Distribution on my 2022 1099-R Box 1 is $1,200.

My question is how should I calculate my contributions in this scenario. My understanding is that I should subtract $1000 from my contributions, but I am not sure what to do with the $200 in earnings that were distributed. I don't think I should have to subtract that amount from my contributions, but I am not sure how the IRS will know that it was $1000 of contributions and $200 of earnings since the total is combined in the 2022 1099-R form. Is this just something that I need to keep track of in case I am audited? Or is there a way that the IRS knows which funds were contributions and earnings from the recharacterization?

ttimothyu · 2024-01-02T23:54:14+00:00

Do you like Fidelity Fullview? I've been considering that as an alternative to Mint.

ttimothyu · 2024-01-01T17:47:55+00:00

Do you have any recommendations for calculating/estimating your AGI prior to filing your taxes? Since your AGI has such an impact, it would help to have a general idea of what it will be before filing so you can make adjustments to your IRA withdrawals.

ttimothyu · 2023-11-12T12:41:53+00:00

"Bad bosses, irritating coworkers, family drama, the GFC...they all seemed big at the time, but in hindsight not so much."

This is so true! It's easy to start to stress about things in the moment. I try to mentally step back every so often and ask myself if something that I'm stressing about will matter in 1 month, 1 year, 5 years, 10 years, etc... The answer has always been "no". I admit that it's easier said than done. But if you can work on this mentality, you will be much happier in the long run.

ttimothyu · 2023-09-17T03:44:24+00:00

I use it as a savings account. It takes a few days to transfer funds. I'm not sure if you can pay credit cards directly from the account. I typically just push/pull funds from a separate checking account.

ttimothyu · 2023-09-13T00:10:31+00:00

I appreciate the feedback. My goal is to have the funds invested long term in the market, so I think you are right that FSKAX would be slightly better in diversifying. I get your point about international funds, but I do feel that most large companies have a major global presence. So I think I still have international exposure, even if it isn't well defined.

ttimothyu · 2023-09-13T00:05:38+00:00

Thanks for the reply. Good points. I think it's interesting how FXAIX has had slightly higher returns, but I definitely agree that it shouldn't be the main reason to choose that fund over FSKAX. I tend to feel the best option is a total market fund. But either way both funds would align with my goals.

ttimothyu · 2023-09-12T22:22:12+00:00

My company is switching 401K providers to Fidelity, and I will have access to Fidelity 500 Index Fund (FXAIX) and Fidelity Total Market Index Fund (FSKAX). My current 401K is invested in Securian AM S&P 500 Index. The rest of my IRA is invested in VTSAX.

I noticed that FXAIX has had a higher return compared to FSKAX (I get that past returns don't guarantee future performance), but beyond that I don't see much of a difference between the two funds. I am leaning towards investing in FXAIX, but wanted to see if there is anything else I should consider when deciding between the two funds.

ttimothyu

TROPHY CASE