Financial advice

#51
#51
If you have money sitting around that you don’t know wha to do with, very general advice is to check off the list below. Sounds like your most of the way through it, but prioritizing tax savings using 401k’s and IRA’s (HSA also if available) should be priority if you don’t anticipate needing the funds. If for whatever reason you do need the funds, it’s also good to know that you can pull out any contributions to a Roth IRA’s penalty free. You can also save medical receipts and reimburse yourself from an HSA for expenses you previously paid out of pocket.

1. Emergency fund (typically 3-6 months expenses, but varies person to person).
2. Invest in 401k up to employer match %/amount
3. Pay down high interest debt. Start with highest % first.
4. Contribute to IRA. Can contribute to current year and previous year up until tax filing. Roth vs traditional depends primarily on income levels and time horizon.
5. Max 401k
6. Invest anything leftover in personal brokerage account.
 
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#52
#52
Thunder Good-Oil said:
Everybody has a different situation. Medicare Supplementa covers 100 days of hospital stays IIRC. But nursing home and rehab is where you can get hit. But in home care is covered pretty well for those with somebody to provide enough basic care. Then hospice benefits get more generous.

A good CFP should know all of the scenarios and best approach.

Hospitals aren’t there for extended care. They treat ailments and keep you alive. But ship patients off to rehab or nursing care facilities once they’re stable. So 100 days is enough hospital coverage in most situations.

It’s the years long nursing home stays that can wipe you out financially.
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Top end nursing home prices in my area are around $10-12K monthly with more affordable options if you want and that’s all inclusive. Is your total retirement budget really much less than that? If your scrapping by on $5K a month then yea I can see LTC wiping out your savings but is that really the type budgets for the folks discussing investing and RMD’s in this forum?
 
#53
#53
ndubvols said:
(snip). If for whatever reason you do need the funds, it’s also good to know that you can pull out any contributions to a Roth IRA’s penalty free. (Snip)
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Before you tap into a Roth, make sure you read up on it:

investor.vanguard.com

IRA withdrawal rules explained | Vanguard

Vanguard explains the rules for withdrawing from a traditional or Roth IRA, including age requirements, penalties, and exceptions.
investor.vanguard.com
 
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#56
#56
ndubvols said:
If you have money sitting around that you don’t know wha to do with, very general advice is to check off the list below. Sounds like your most of the way through it, but prioritizing tax savings using 401k’s and IRA’s (HSA also if available) should be priority if you don’t anticipate needing the funds. If for whatever reason you do need the funds, it’s also good to know that you can pull out any contributions to a Roth IRA’s penalty free. You can also save medical receipts and reimburse yourself from an HSA for expenses you previously paid out of pocket.

1. Emergency fund (typically 3-6 months expenses, but varies person to person).
2. Invest in 401k up to employer match %/amount
3. Pay down high interest debt. Start with highest % first.
4. Contribute to IRA. Can contribute to current year and previous year up until tax filing. Roth vs traditional depends primarily on income levels and time horizon.
5. Max 401k
6. Invest anything leftover in personal brokerage account.
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This is the correct course of action.

To OP - yes, you are a bit behind.. good news is you have plenty of time to catch up. When it comes time to invest, there is no need to be fancy - go all in on index fund type ETFs (SPY, etc). Later on you can take a small percentage of your portfolio for more risky investments but now is not that time, build your foundation.
 
#57
#57
$10,000 needs to double 6-7 times to become a million.

A return of 10% doubles in about 7.2 years. 12% doubles in 6 years.
 
#59
#59
JFreak said:
This is the correct course of action.

To OP - yes, you are a bit behind.. good news is you have plenty of time to catch up. When it comes time to invest, there is no need to be fancy - go all in on index fund type ETFs (SPY, etc). Later on you can take a small percentage of your portfolio for more risky investments but now is not that time, build your foundation.
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We are fixing to find out. Moved cd to checking account yesterday evening. Trying to figure out what I want to leave in checking for E fund
 
#60
#60
This pullback is creating a buying opportunity. But be patient.

VTI vs. VOO: Which ETF Should You Buy? - 24/7 Wall St.

VOO (Vanguard S&P 500 ETF) and VTI (Vanguard Total Stock Market ETF) are both excellent, low-cost (0.03% expense ratio) Vanguard funds for U.S. equity exposure. VOO tracks 500 large-cap, established companies, while VTI offers broader diversification by including over 3,700 companies of all sizes, including mid- and small-caps. VOO often slightly outperforms in tech-heavy markets, while VTI provides more comprehensive U.S. market coverage.

Key Comparisons:
Holdings: VOO focuses on ~500 large-cap stocks. VTI includes these same stocks (comprising ~82% of its weight) plus thousands of smaller, mid-cap, and small-cap companies.

Performance: Recently, VOO has slightly outperformed due to the dominance of large-cap tech. Historically, over very long periods, smaller companies in VTI have sometimes outperformed.

Volatility: VTI can be slightly more volatile due to its exposure to smaller companies, though both are highly correlated.

Best For: VOO is ideal for those favoring large-cap, stable,, and high-cash-flow companies. VTI is better for investors seeking the broadest possible exposure to the entire U.S. economy.

Which one to choose?
Because VTI is about 87% VOO, the performance difference is often minor. Both are excellent for building long-term wealth, and in many cases, investors choose based on whether they want just the "industry leaders" (VOO) or the "entire market" (VTI).
 
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#61
#61
Thunder Good-Oil said:
This pullback is creating a buying opportunity. But be patient.

VTI vs. VOO: Which ETF Should You Buy? - 24/7 Wall St.

VOO (Vanguard S&P 500 ETF) and VTI (Vanguard Total Stock Market ETF) are both excellent, low-cost (0.03% expense ratio) Vanguard funds for U.S. equity exposure. VOO tracks 500 large-cap, established companies, while VTI offers broader diversification by including over 3,700 companies of all sizes, including mid- and small-caps. VOO often slightly outperforms in tech-heavy markets, while VTI provides more comprehensive U.S. market coverage.

Key Comparisons:
Holdings: VOO focuses on ~500 large-cap stocks. VTI includes these same stocks (comprising ~82% of its weight) plus thousands of smaller, mid-cap, and small-cap companies.

Performance: Recently, VOO has slightly outperformed due to the dominance of large-cap tech. Historically, over very long periods, smaller companies in VTI have sometimes outperformed.

Volatility: VTI can be slightly more volatile due to its exposure to smaller companies, though both are highly correlated.

Best For: VOO is ideal for those favoring large-cap, stable,, and high-cash-flow companies. VTI is better for investors seeking the broadest possible exposure to the entire U.S. economy.

Which one to choose?
Because VTI is about 87% VOO, the performance difference is often minor. Both are excellent for building long-term wealth, and in many cases, investors choose based on whether they want just the "industry leaders" (VOO) or the "entire market" (VTI).
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The performance is not materially different. So, the thing to consider is do you want the diversification and simplicity of one fund in VTI or do you want to buy VOO and then also buy another small cap fund with the weighting of your choice?
 
#62
#62
Ernest T. Vol said:
The performance is not materially different. So, the thing to consider is do you want the diversification and simplicity of one fund in VTI or do you want to buy VOO and then also buy another small cap fund with the weighting of your choice?
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That’s the big questio. Which one do you step into since VTI does have a lot of what VOO has but at a discount price vs VOO
 
#63
#63
allvol90 said:
That’s the big questio. Which one do you step into since VTI does have a lot of what VOO has but at a discount price vs VOO
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To me, it has to be VTI over VOO because there have been times (and could be times) when other parts of the market have outperformed the S&P. The S&P has been around, as some sort of index, since 1957. What was in it? What was left out then and is the data thus tainted in its measurement? I don't know, but it doesn't include any small or mid caps. There is legit disagreement within the investment advisor community about whether one should "tilt" their portfolio even more toward mid and small cap from VTI. But, the primary consideration is the overall allocation of stocks and fixed income (bonds). That first allocation decision is the driver for a lifetime of returns and critical for young folks. After you determine your overall allocation cake of stocks and bonds, consider the icing of how much mid and small cap.
 
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#64
#64
You really can’t go wrong with VOO or VTI. Vanguard is a very good organization. A mutual company owned by its “customers”.
 
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#65
#65
Scott Bessent (oddly the Treasury Secretary in a Republican administration AND a disciple of George Soros) owns QQQ, SPY, and RSP (Invesco Equal Weight S&AP 500 ETF).
 
#67
#67
allvol90 said:
How do you guys feel about dividend stock. Like VYM or VIG
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Those two are of course funds rather than stocks. But they are good for generating income when you own shares. Better in a tax deferred or tax exempt account than giving a cut to the IRS when inside of an after tax account.

I’d maybe look at their top holdings and owning a few of those stocks instead. ETFs include many names - including the bad ones.

But Vanguard is very efficient with their fees. Many individual investors aren’t aware of how much they lose in ETF fees since they are paid out of the fund’s investments rather than directly from the customer (investor) writing a check payable to the fund manager.
 
#69
#69
Looking for ideas on aging parents checking account. Background - 2 living parents. Father is much more likely to pass before mother. Mother suffers from aging mental decline and has been declared as such by her doctor with appropriate paperwork. Mother unable to write checks and will either move into managed care or have full time in home care when father passes. What options are available for their joint checking account when father passes so that mother’s expenses can be paid? Brokerage accounts are also joint and have the beneficiary set up to be distributed per their will. If I have financial POA, is there any advisable correspondence with the brokerage company prior to father’s passing? Still got time God willing, but looking to have all the bases covered before the time comes.
 
#71
#71
allvol90 said:
My number 1 question would beis their assets in a trust?
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No trust - a valid will and all financial accounts have appropriate beneficiaries assigned. Parent’s home will likely be sold if mother enters managed care facility prior to her passing. I haven’t read anything yet to lead me to believe a trust is needed for their estate, but I could be convinced otherwise if it makes sense. Also, 3 children all in their 60’s that all get along fine and the split of assets are 1/3rd to each.
 
#72
#72
These are questions for a CFP or attorney, but an irrevocable trust might be needed for their assets (if it’s not too late). The elderly indivuduals can be designated as beneficiaries of the trust to receive the dividend, interest, and capital gains INCOME while they’re alive.

Transfers on death (TOD) designations are good for avoiding probate. But that doesn’t protect the assets.

The financial power of attorney ends IMMEDIATELY upon the death of the person that needed the POA.

The managed care facility will take every asset until they are paid in full. Therefore an irrevocable trust is worth investigating to hold all of the assets.

A revocable trust will only help make the probate process easier. They’re good if there are young children that might not do very well managing newly acquired wealth and for complementing a will. But assets will not be shielded from creditors.

IIRC. Hire or consult with a professional succession planner instead of relying on advice from message boards.
 
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#74
#74
Brokerages and banks will work with you on the poa's, depending on wording. Most poa's wont give you the power to change beneficiaries. Brokerages and banks will want the "official" poa that has been recorded at your courthouse. Check with the attorney that drafted them to make sure it is recorded and ready. Keep several copies on hand to deliver. Local banks where you have a relationship and they know you work better on these things. If you pay electronically, you'll have to set up your own portal and passwords. Even with the poa, some brokerage functions may not be available to you online.
 
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#75
#75
Flogballs said:
It’s only money. You can’t take it with you
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He's not asking for financial advice to transport his money to the afterlife. He's specifically asking for advice as to how best set up things for the future for his children.

The "it's only money, you can't take it with you" mindset is very old and outdated and is unfortunately how millions of our population suffer from debt and have absolutely no savings and either are or will be nearly completely dependent upon the federal government through social security only. This is just simply not a healthy way to live, mentally, as a society.

But for the sake of argument sure you can't take it with you. You know what you can do? You can bless others by living more disciplined and less selfish while you're on this planet. If a person doesn't have children, you can leave it to a cause or a Church that you believe in, or anyone or anything for that matter. It's more of a legacy thing and helping others after your time here is done. Not to mention it's just a more responsible way to live and be.
 
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