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Messages - lascott

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1
15-20% is insane.  Its time has come and gone. Big players involved now.  Invest elsewhere. Stock market and other divesting.

2
Off Topic / Re: Cash Parking
« on: January 25, 2020, 12:01:34 AM »
I use Ally online savings too and am a very happy camper. Their interest rate is always a bit lower than others but I think they can get away with it since they provide an exceptionally good online experience and service. Free next day transfers is one example. You can even name and change your primary and contingent beneficiaries online (up to 10). That's pretty rare.

So, I online opened a Kasasa checking account at TAB. Smooth sailing. After about a week someone called, verified some security questions and enabled my online account with zero balance. The website seems to have almost everything I'd like and the phone app likewise. However, beneficiaries can't be named online. ...
The only place I cannot do my beneficiaries online is my Chase brick-n-mortar via their website. They want you to come in. My nearest branch just had all the tellers removed but I'm sure there are others there to do this if I walk. They have the nerve to bug me about becoming a Chase Private Client (https://www.creditdonkey.com/chase-private-client-review.html) where they want $250K of my money.   

3
Investors - LC / Re: Worst Month Yet
« on: January 24, 2020, 11:52:58 PM »
STRATA contains a ROTH IRA for me that is comprised of
a) the remaining $5K of LC notes and
b) Wunder Capital "notes" [which have turned out excellent but they no longer offer retail anymore as they got bigger and obtains $ from big investors]. 
This means I'll keep it open for several years.

I have a regular (1099-OID) LC account still too. Not sure that was worth it as takes took too much of the profit.

If I had a do-over I'd probably never bought 5 year LC notes and just stuck with 3 year so the unwinding was quicker.

Was fun and entertaining overall tho.

4
Off Topic / Re: Cash Parking
« on: January 21, 2020, 09:49:16 PM »
Does anyone use a Kasasa free reward checking account? TAB bank has one of these that offers 4.0% APY on up to $50k. The catch is that you must make at lest 15 debit card purchases per month or the interest rate drops to 0.25%. Other banks have similar Kasasa accounts with lower APR, lower max deposit and fewer required debit card purchases.

https://www.depositaccounts.com/banks/tab-bank.html
https://www.tabbank.com/kasasa-cash-checking/

I'm so fed up with Wells Fargo I decided to look into checking accounts and discovered these things. I'll probably give the TAB Bank account a try.
Looks legit.  Looks like there are a couple requirements tho. See graphic below.

I currently use Ally online savings (1.6% down from highest of 2.2% I think). Everything I've done with them has been smooth and their interaction with my brick&mortor longtime bank is quick.  I've been looking into a better location for 'bucket 1' retirement money recently. I haven't see where it would be worth the hassle tho. (Recently looking at: VWSTX Vanguard Short-Term Tax-Exempt Fund & VWITX Vanguard Intermediate-Term Tax-Exempt Fund Investor Shares)

Via: https://smartasset.com/checking-account/tab-bank-banking-review

5
A *very* well known and respected site provided a good overview.

SECURE Act And Tax Extenders Creates Retirement Planning Opportunities And Challenges
DECEMBER 23, 2019 07:35 AM
https://www.kitces.com/blog/secure-act-2019-stretch-ira-rmd-effective-date-mep-auto-enrollment

6
Well as of 12/20/2019 the SECURE act was passed and signed. By eliminating the Stretch IRA congress has imposed a huge "death tax" on savers with Traditional IRA's and have stolen much of our children's inheritances. Don't you just love Christmas surprises. Another case of changing the rules in the middle (or actually near the end) of the game. Unprecedented bipartisan support. Gee, wonder why. They don't need to be greedy now since they just print the money and spend it anyway.

https://www.wsj.com/articles/congress-is-coming-for-your-ira-11562713559
Eek.  Will have to read up on any techniques for dealing with this.   Staying under the gift tax exclusion amount and giving earlier is one things we started and will increase at 59.5. [Gift Splitting - both spouses give: https://www.investopedia.com/terms/g/gift-splitting.asp )

https://www.investopedia.com/secure-act-4688468
Understanding the SECURE Act

BTW, I haven't seen it explicitly said (and haven't read the act) but I'm pretty sure the new RMD rule for inherited Roth IRA's extends the withdrawal period from the current 5 years to 10 years. Beneficiaries will have an added 5 years in which their inherited money is able to grow tax free before it must all be withdrawn (there is no "annual" minimum withdrawal). There's gonna be a lot of Roth conversions now through 2025 when the TCJA expires and tax rates go back up.

In an extraordinary coincidence we have a conference scheduled with our estate planning attorney on 12/26. Way past due for an major update. The appointment was made a couple of weeks ago; well before I ever heard of the SECURE act. We have a lot more to talk about than I imagined! Go figure.

I did a search for articles/changes in the past week using: RMD  "inherited Roth" IRA withdrawal period "5 years" to "10 years"
and found the below quickly.

https://www.forbes.com/sites/leonlabrecque/2019/12/22/the-roth-charity-offset-getting-more-bang-out-of-a-roth-conversion/#78b139db6fbf
"IRA: they can grow tax-free, they are not subject to Required Minimum Distributions (RMDs), and they can pass tax-free to a spouse or heir. The new SECURE Act adds an important advantage for many heirs. Under SECURE, heirs have the opportunity to grow their inherited Roth IRA’s tax-free for 10 years past the death of the IRA owner."

7
Well as of 12/20/2019 the SECURE act was passed and signed. By eliminating the Stretch IRA congress has imposed a huge "death tax" on savers with Traditional IRA's and have stolen much of our children's inheritances. Don't you just love Christmas surprises. Another case of changing the rules in the middle (or actually near the end) of the game. Unprecedented bipartisan support. Gee, wonder why. They don't need to be greedy now since they just print the money and spend it anyway.

https://www.wsj.com/articles/congress-is-coming-for-your-ira-11562713559
Eek.  Will have to read up on any techniques for dealing with this.   Staying under the gift tax exclusion amount and giving earlier is one things we started and will increase at 59.5. [Gift Splitting - both spouses give: https://www.investopedia.com/terms/g/gift-splitting.asp )

https://www.investopedia.com/secure-act-4688468
Understanding the SECURE Act
The SECURE Act is designed to ease the looming retirement savings crisis by:

  • Making it easier for small businesses to offer their employees 401(k) plans by providing tax credits and protections on collective Multiple Employer Plans
  • Allowing retirement benefits for long-term, part-time employees
  • Removing maximum age limits on retirement contributions, formerly capped at age 70 1/2
  • Raising the required minimum distribution (RMD) age to 72 from 70 1/2
  • Allowing penalty-free withdrawals up to $5,000 from retirement plans for the birth or adoption of a child
  • Relaxing rules on employers offering annuities through sponsored retirement plans
  • Allowing penalty-free withdrawals of up to $10,000 from 529 education-savings plans for the repayment of certain student loans
  • Revising components of the Tax Cuts and Jobs Act that raised taxes on benefits received by family members of deceased veterans, as well as students and some Native Americans.
  • And to raise an estimated $15.7 billion to pay for these changes: removing the stretch IRA estate-planning strategy that permits non-spouse beneficiaries of IRAs to spread disbursements from the inherited money over their lifetime. The new limit will be within 10 years of the death of the original account holder.

8
Investors - LC / Re: Other Investment Options at Strata
« on: August 21, 2019, 03:20:41 PM »
Hi,
Yeah I think I read your post about wunder capital. Yeah their website only mentions institutional investors now.
The withdraws from Strata are charged at $100 a pop though right?
No charge for ACH withdrawal.  Fees: https://www.stratatrust.com/resource-center/fees/  FYI old fee documents explicitly said ACH monthly or quarterly. No longer. I was not charged anything recently. I had called and verified. Handy to fill it out online and electronically sign it.

Oh I'm sorry you were taking out contributions. I was thinking about IRA to IRA transfer. Which I think in the form you linked is categorized as a partial termination ($100).
While I think it is simpler/safer to do a direct custodian to custodian transfer it would seem you could ACH withdraw the money and within 60 days put it in another IRA.


9
Investors - LC / Re: Other Investment Options at Strata
« on: August 19, 2019, 07:42:15 PM »
Hi,
Yeah I think I read your post about wunder capital. Yeah their website only mentions institutional investors now.
The withdraws from Strata are charged at $100 a pop though right?
No charge for ACH withdrawal.  Fees: https://www.stratatrust.com/resource-center/fees/  FYI old fee documents explicitly said ACH monthly or quarterly. No longer. I was not charged anything recently. I had called and verified. Handy to fill it out online and electronically sign it.

10
Investors - LC / Re: Other Investment Options at Strata
« on: August 16, 2019, 04:42:57 PM »
I'm using it with Wunder Capital (7.5%) but they are no longer allowing retail investors in (like LC scaled-back retail investors indirectly by limiting avail notes and info).

I have a ROTH IRA and was very disappointed in the low low interest that STRATA was giving for that cash. They didn't enlighten me with good options they know of besides TD.

However, they did point out that you can do the withdrawal electronically (fill out and sign). Since I was getting ready to take out some 'ROTH contributions' (not gains) anyway that worked perfectly.
https://www.stratatrust.com/resource-center/forms/ and then 'IRA Distribution Request'.

11
Very sorry to hear about the medical issues; both emotionally and financially challenging.
It does sound like your situation is pretty unique. Only 1% retire in their early 50's. I have no idea how that's done but I assume a lot of hard work and an exceptional amount of planning were required. I'd never heard of the 72t/SEPP and ACA 400% FPL until you mentioned them so I looked them up. Your plan is working very well. That 6.57% is terrific!
Hey thanks. Medical issues are under good control but just regular (quarterly) doctor and specialist visits. Just makes you think about the future and additional cost.
It was quite a mixture of things that got us to this point. Mosting doing the recommended things of maximizing 401Ks (before & after tax -- after tax then convertible to ROTH IRAs ** via 2014-54) as well as IRAs each year regardless of what the market is doing. Doing that for 25 years.  Of course, we both had to have decent jobs to be able to do that. Lot of hours during early years. One of the best things I can do for the kids is teach them, guide them, and help them take advantage of the savings plans. ROTH type accounts are one of the best things going now. Makes tax planning simple! :)

UPDATE: ** IRS Tax Notice 2014-54 -- https://www.irs.gov/pub/irs-drop/n-14-54.pdf

12
Borrowers - P / Re: Attn: Loan ID: 10165805
« on: August 09, 2019, 02:43:45 PM »
All sounds very reasonable on the surface. I don't invest in P2P anymore but good luck.

Paying interest is throwing money out the window as most know. With both your income you can snowball this debt yourselves of course.  Minimum payments to lowest interest debt. As much as you can to in a payment to your highest interest debt.  https://www.google.com/search?q=debt+snowball

https://www.youneedabudget.com/


13
Think you hit a typo selecting Married Filing Separately. We're MFJ.
<snip>
Additionally I think that only 85% of Social Security income being taxed (as in my case) makes a difference. A fair amount of my income is S Corp profits that qualify for the TCJA QBI deduction and our Long Term Care insurance premiums are paid by the company and are deductible on the front page. Everybody's a bit different every year. Take $15k off the $115k total income for these reasons and tax as a percent of income is 8.74% and the tax bracket is 12% according to the on-line calculator. The chart is pretty close to that.
Doh! My bad.  That is outstanding all things considered. Nice job!
Our situation is odd because we are in our early 50s so it is more complicated for tIRA withdrawals and healthcare. Until we are 59.5, we are dipping into our ROTH IRAs for half of our income and tIRAs via 72t/SEPP for the other half. Good for taxes and ACA 400 FPL%. One of us has health issues so it gets expensive quick. Also helping kids with tax-free gifting to boast their retirement ROTH IRA/401K investing while they are young for a few years.  Our effective rate is about 6.57%.

14
After 2019 I will have to take an RMD each year. A rollover from a tIRA to a rIRA does not count as a RMD so I'm thinking my regular income plus RMD will make the amount I can convert to a rIRA and keep my tax bill down will be pretty small. That's my gut feel but I will run the numbers in December each year to see if I can convert at least a small amount into my rIRA and keep my total effective tax rate on target. It is my plan to pay taxes from regular savings and not pre-tax dollars. We will leave the Roth dollars the last to spend to give them the max time to grow.

I don't really see how you are getting that low of effective tax rate in your chart? RMDs from a tIRA and addition income from a tIRA to rIRA conversion seem like it be a much higher effective tax rate.



I've used several planners but ended up paying for the professional one mentioned above (and yearly maint).  Gives me a lot more confidence in the planning and it is known to be accurate with taxes.

15
@Rob L, Did you try out B or C?

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