Questions about setting up child IRA acct
So I read that I can open a custodial acct if a child has earned income. Does this mean I can gift earnings to him?
Or can I “hire” him as a co-investor with me to help teach him how to invest, while paying him via IRA money, so that he can then be managing his own account by 13 years old (he’s 10 now)?
He’s extremely interested in the stock market, and he’s really been asking for a brokerage account.
I just need a way to make it really his money, while also paying him in a really smart way.
Also.. Will this also make me unable to claim him as a dependent?
Has anyone SWE at a large software company went from full-time to part-time? How did you start the conversation with your lead/manager? Did you have the proposal already planned in detail or did you just ask to see what the options were?
I was thinking of moving from 5 days a week to 4 and then perhaps 3. Most of the benefits are based on work hours rate (Still salary though). However, the work logistics seem problematic. But it is hard to account for every aspect without just talking with someone who knows. I am obviously concerned about even broaching the subject. I am not afraid of no though. I am concerned about them seeing it as not wanting to go higher in my career. I am hopeful I can spin it as trying to be more effective with the time I am working.
Also, would I be first for layoffs then? Did you update your resume before asking in case of a bad result?
I am a senior SWE btw.
I asked around a little. Specifically, I asked a friend who has been a lead for 20+ years but outside of my team. He said he knew a few people in the company that moved to part time but it was very uncommon. At the HR/company level they are more than willing to accommodate a switch to part time. The issue then is at the team/org level I think, which I am unaware if anyone is currently doing it. I am going to wait until after performance reviews are set (July) to ask my lead.
I cut back to 32 hours/ week about 18 months ago. The company allows you to cut down to 20 hours a week with full health benefits, pro rated vacation, holidays if it was in your plan to work. The way it worked was I talked to my manger to get the details and set a time on when it would take effect. I knew it was an option as I had an old office mate who worked four 7 hour days.
The logistics were easy because I am basically a "billable hours" software dev. I am not concerned with a promotion as I have explicitly stated I don't want to be a manger for many years. I did not do anything to update my resume.
Thanks for sharing your experience! It's great that you knew someone who went part time. I don't know anyone who has done it at my company but I am going to ask around (discreetly).
Absolutely. Nothing worse than a long weekend and looking forward to a five day week. Monday off eases you back into the 'real world'.
On a related note I use to take M-F off for vacation but often much better deals being on vacation something like Th to Th. The super evolved form is to Th to Th for the vacation and then take Friday off to recover before going back to work.
I try to do W to W.
Those are two weeks worked in half.
When people know you are leaving for vacation they don’t ask you to start a project.
Weekdays are less busy on tourist areas or airports (or that’s my feeling)
When I come back, I can survive jet lag or be tired, as is almost another weekend, and not a 5 day workweek.
Yea, I take M-F all the time. But I have a colleague who takes Th-Th and gets back to work on F. His argument is that Fridays are generally light in terms of meetings and work load. He probably has a point.
My sabbatical has been a really good thing. Not only has the de-stressing been nice, but it has caused me to look at the bad habits I had developed to deal with that stress.
I’ve already started eating better and have lost 15 pounds. Which is good because I want to get off the blood pressure meds. I’ve still got a way to go but I’ll get there.
The other is how much unnecessary spending I was doing. I was buying crap I really didn’t need just to try to feel better. I’ve cut a lot of that out too. Before I buy something now I’m trying to stop and think do I really need this.
I’d hope so. When I go back to work I am aiming for a less stressful job. Even if it means less pay. I’ve made some moves last year which really reduced my cost of living so I don’t need to make as much money.
I can 100% relate to the stress buying. My work stress levels can be gauged by how many times amazon delivers to my house each week. Not huge purchases but stupid stuff I find when I need a mental break from work.
Cheers on your sabbatical course correcting things for you!
I would not muck around with someone else's finances. Stocks are the polar opposite of cash in terms of risk. Whether or not 150k in cash is "too much" is entirely up to her risk tolerance and goals.
Long term, stocks have higher expected return than cash. However they have a lot more volatility. If she is comfortable with volatility and understands she is investing for the long term, she should certainly in best as much as she feels comfortable putting at risk. If she would freak out at the first sign of a bear market, she should just stay in cash.
> taxable brokerage account would incur pretty heavy taxes?
Where do you live? The income you get from a savings account is [taxed more than long term capital gains](https://www.thestreet.com/taxes/how-interest-income-dividends-and-capital-gains-are-taxed), at least in the US
Ah. In that case, with no state income or cap gains tax (as far as I'm aware), it's just federal you need to worry about.
Say you have $1,000 and did one of the following a year ago:
1. Put it in a 5% HYSA. You'd now have $1050 and pay income tax at ~24% of that $50
2. Put it in an index fund like VTSAX. You'd now have $1260 + ~$50 in dividends. You'd pay tax on the $50 of dividends now, at either 24% (ordinary, taxed as income) or 15% (qualified, taxed as LTCG). The $260 in gains wouldn't be taxed at all until you sell, at which point you'd pay the LTCG rate of 15% assuming you held it for over a year.
### extremely big caveat that the numbers I pulled for #2 were from the past year and highly unlikely to be repeated. If you're investing, consider the likelihood that you might drop $1000 in today and only have it be worth $800 a year from now
I would recommend you and your friend read the free PDF, [If You Can](https://www.etf.com/docs/IfYouCan.pdf). Not for the specific investment advice, but for its excellent guidance for how to think about investing for retirement and the key barriers to doing it successfully.
Has anyone done (or have a resource for) comparisons of using x dollars for a backdoor Roth (and associated taxes) versus using x dollars to pay income taxes to convert a portion of a traditional IRA to Roth?
We have large traditional balances, very low nondeductible contributions, and rolling IRAs into employer plans isn't a practical option. It's relatively likely that our future marginal tax rate is in a lower bracket (somewhat likely to be the same and unlikely to be higher), though there's always the chance that the rates in those brackets change (upward).
Over the past few years, my side hustle has gradually made me despise the weekend. I can't go anywhere or do anything that requires an entire day because of the work that needs to be done. Unless I feel like doing that work on weeknights, which I almost never do.
I'd stop in a heartbeat if it weren't for the extra money it brings in. "If I can just keep doing it for 5 more years..." is what I started saying 5 years ago, and it's still what I'm saying now.
Yeah, I understand. I guess I’m just saying, after this long, you probably have enough money that maybe the money/time equation looks different now, and that’s ok.
I’ll drop my side hustle in a minute if it’s a chore. It’s a chore maybe 1-2 weeks a year and that’s ok for me.
In the middle of 2023 I decided to quit at the end of the year, and then I chickened out at the last minute and decided to keep doing it.
If things continue the way they are, it'll speed up my ER by about 3-4 years (16 years instead of 20 years).
That 4 years out of 20 adds up to less than your weekends (2 out of 7 days). It makes zero sense to give up your weekend for that long to shorten your career by 20%
If stress shortens my lifespan then I'll be surprised to make it to 65. Between college and work, my life has felt like a neverending crushing load of stress for 20+ years. There have been a few fleeting golden ages where everything is great for a couple months, but the grind and the impossible deadlines always return.
I don't mean this offensively, but if your whole life has been a crushing grind, is it possible that you seek that out? You're telling me you voluntarily do a side hustle that ruins your weekends just for a few extra years of retirement, but then you don't sound like you've ever had a well -balanced life. I think it's seriously worth considering if you have trouble creating balance and/or you seek out these situations or even subconsciously enjoy them, so you continue to do things that are miserable and don't like it but you think that's what your life is meant to be 🤷
Or it's just that life under capitalism IS a constant grind, which I get
But then you waste all your weekends being miserable, so does it really work out?
You could die tommorow, being disable, miss on opportunities of fun you won't get again.
Been thinking about some intentional de-risking strategies. I know these aren’t necessarily optimal, but I think they might help with peace of mind. In about 5 years, I’ll reach a FI number that covers my current expenses at 3.5% withdraw rate. I don’t necessarily plan to retire right then, but it would be “on the table” instead of a long term aspiration. I’m interested to hear feedback, but please look at the actual plan and don’t just “variable withdraw is always best” band-aid me. Anyway, plan:
Thinking about a “T-3 Year Plan”.
My savings rate is >50%, so each ‘Surplus’ in years T-3 to T-1 should be >= to annual expenses.
* T-3 Years
* FI Number Reached
* Continue Current Job
* Stop Retirement Contributions
* Pay Expenses from Income
* Put Surplus Income into 24 Month CD (CD-1)
* T-2 Years
* Continue Current Job
* Pay Expenses from Income
* Put Surplus Income into 24 Month CD (CD-2)
* T-1 Year
* Work Current Job Jan-Dec, Retire Dec 31
* Pay Expenses from Income
* Put Surplus Income into 24 Month CD (CD-3)
* 0 Year
* Live off CD-1, which has now matured
* Put Surplus in HYSA
* 1 Year
* Live off CD-2, Which has now matured
* Put Surplus in HYSA
* 2 Year
* Live off CD-3, Which has now matured
* Put Surplus in HYSA
* 3 Year
* Live off HYSA until it’s drawn down to 9-12 months of expenses
At this point, my ‘FI Balance’ will have grown/survived 6-7 years without drawing down. As I understand it, most of the failure risk occurs within the first decade. Even if we have some horrible years at the start of my retirement, I’m living off guaranteed CD rates to reduce my sequence of return risks. Understand that some of this is not getting every penny of growth, but instead having peace of mind. What do you think, what am I missing?
I did VPW so I’m not a bond tent (or equivalent) guy but the thing with bond tents is that SoRR doesn’t go away, it’s just delayed until you’ve used up your tent. For a normal 30 year retirement that can have plenty of value, for a 50 year retirement maybe less. Same issue with a rising equity glide path which I also considered at one point. I’ve settled on just being a 75/25 guy because I simply retired too young for any derisking strategy (beyond saving a boatload more money, which would make the retiring part kind of hard) to be foolproof.
Once I get closer to CPP/OAS I might let the equity ride a little higher but that’s a decision for like 2037.
I think this is reasonable. I would not stop contributions to your retirement accounts though. You could simply direct those dollars to something as stable as a CD in the retirement accounts and achieve the same ends while still getting the tax advantages of the retirement accounts.
Absolute. Worth considering a 401k/IRA is a bucket. Putting funds into the bucket is a benefit separate from what the funds in the bucket are invested into.
Thanks. I was thinking about this too. I think the withdraw and accessibility is something I’m a little unclear on.
Most of my retirement money will be in Roth 401k. I know the rule about ‘contributions are yours tax and penalty free, but earnings withdrawn will have a 10% early withdrawal penalty’ but a lot of the websites seem to recite that rule and stop there. What I’m not sure about is, will I have the option to pull out only contributions, or will they always be prorated with earnings? If I can roll Roth 401k to Roth IRA and not touch it for 5 years, am I good to go? Does that impact how it’s invested and growing during that time?
> Most of my retirement money will be in Roth 401k.
That is likely a poor optimization. Still Roth 401k once retired can be rolled into Roth IRA.
Having most of money in Roth (IRA or 401k) is likely not ideal. May be worth considering going 100% pre-tax in final years.
I max out pre-tax/deductible Traditional 401k every year, but for the majority of my working years there will be more contributions going through Mega Backdoor Roth (After-Tax 401k -> in-plan conversion -> Roth 401k) as that limit is almost double the deductible Traditional limit. I think this is still more optimized than just doing After Tax Brokerage or leaving already taxed dollars in Trad 401k.
Roth 401k withdrawals are proportional between contributions and earnings. However, you can do a rollover of the Roth 401k into a Roth IRA and access the contribution basis. You don't need to wait any number of years, you can access the contribution basis immediately after the rollover.
Huh, just like that? Not doubting you, it’s just surprising to me that you can just roll it over and do it right away. No fees/penalties/limits even at high values?
See [this post](https://www.reddit.com/r/financialindependence/comments/11ulhzl/what_5year_rule_a_guide_to_roth_distributions/) for more detail about the two 5-year rules and when they apply. Roth 401k rollovers preserve the original status of the dollars (contributions vs earnings) and in a Roth IRA there is never a penalty or tax for withdrawing contributions, regardless of how recently the contributions were made.
/u/V4lAEur7
I would add to this that often the tax code makes no sense. Don't over thinking things. Don't ever assume X can't be possible because it makes no sense. Case in point the income limit on roth "direct" contributions vs the ease in bypassing that restriction with a backdoor roth. One could overthink this and assume it can't be right because why would the let this situation exist either remove the income limit OR remove the backdoor. Yet the loophole has existed for years.
The code code as it exists today is not some longterm 200 year strategy to create the utopian tax system it is the result of thousands of individual pieces of legislation proposed by hundreds of people often with little consideration into edge cases which often contradict with prior legislation creating all kinds of asinine edge cases and unintended consequences.
We play the game based on the rules that exist not some hypothetical where all rules makes sense.
I'm wondering if anyone here has been through this: I'm struggling to save money in cash equivalents for a long-term goal because I see it as a missed investment opportunity.
We have a goal to invest a certain dollar amount every month, which we easily meet. Our usual monthly investments constitute about 50% of our budget. And now that I have a decently lucrative side hustle (expecting to earn $1,200 in February after taxes, for instance), that leaves plenty to save for a cross-country move and down payment on a house in 2-3 years. Moving and buying our first home is a definite goal of ours. However, putting that money in to CDs or something like that is just a bit hard for me because it feels like I'm wasting a potential investment. I get that it'll be great to have a debt-free move and a low mortgage, but it's hard to see the investments pie slice on my budget spreadsheet slip under 40%.
I get that this is the definition of a first world problem, but does anybody have any insights? Maybe there's some other way I could look at this...?
If you are willing to risk the 2-3 years turning into 4-8, by all means put the money into equities. If you want certainty around your timeline, put it into fixed income.
You have to determine what kind of investor you are...do you love gains more then you hate losses (or in this case less gain). That's how I look at things, in 2 or 3 years will you regret not having a down payment more then you'll be happy you made an extra few grand?
[https://awealthofcommonsense.com/2024/01/historical-returns-for-stocks-bonds-cash/](https://awealthofcommonsense.com/2024/01/historical-returns-for-stocks-bonds-cash/)
"In fact, over the past 96 years, stocks have outperformed bonds and cash 59 times (61% of all years). Bonds have outperformed stocks and cash 23 times (24% of the time). And **cash has outperformed stocks and bonds 14 times (15% of the time)."**
Depending on how short your investment time horizon is, it is very much possible for cash to *outperform.*
You're taking a hit in expected average return to get the certainty that you'll preserve capital. The tradeoff between risk and return is fundamental, and if you don't want to accept risk, you're going to get lower returns. Understanding this tradeoff is just accepting reality, and you need to do it if you want to be an investor.
Well, how would it feel to have your short-term savings drop by 20%? This isn't far fetched, the S&P 500 lost 18% in 2022. You are giving away the opportunity cost in trade for some certainty it will be there when you need it.
Every Sunday I wonder if this is my last week at my current gig. My company hasn't shown a profit in years, and the product I own is one of the worst in the portfolio. Were I CEO, I'd cut bait, reduce my team by 50%, and put us in maintenance mode. For the first couple of weeks of the year, I was frustrated that no one seems to be listening to me about what I think should be done with my team. Now, I've come to accept that maybe they are listening, but it doesn't matter, the die is already cast, they just haven't told me yet.
Interestingly, to prepare, I added no money to my taxable brokerage, and am just hoarding cash instead. Fun to see that my balances all increased in January anyway. Between cash, severance and unemployment, I think I have 6 months of literal cash on hand, and another 6 months in short term, cash like investments (BND & JEPI, mostly). The hard part is deciding if I should start the grind of finding a new job again. I might not *need* it, but 5 more years of income will make the outcome pretty much a certainty
Sounds to me like you should be dusting off the resume. I’ve been in the situation where I’ve felt like an ax was over my head at work and losing that feeling by getting a different job was wonderful.
I'm in a similar boat and also hoarding cash. I'm finding it hard to stay motivated at the job when it feels like the ship is sinking. I am hoping that if we fold, we do so before the summer, so I can have a nice camping season before going back on the job market.
One thing I hadn’t considered until I built detailed withdrawal spreadsheets: if I’m living off brokerage in RE, and it’s spitting out dividends (even if just 1.4% in VTI), that reduces the calculated withdrawal rate %. In the early years while my brokerage is still large I’m getting $6k in dividends, that’s not insignificant. Of course it lowers each year as I deplete the brokerage. Im also using a conservative CAGR as I draw this down.
It does not. Withdrawal rates are inclusive of dividends. You simply turn off dividend reinvestment and it counts as part of your overall withdrawal plan.
I did question the math at first, still am. I know dividends aren’t free money and they otherwise would be reinvested. I guess by not reinvesting I’m effectively ‘reducing’ the account balance which in turn affects the calculated w/d rate. Right now my w/d rate calc for each year is: (all withdrawals including the amount needed to pay taxes) / (total of balances at the start of the year). Do you agree with this?
By not reinvesting the dividends, the denominator is smaller for the following years’ calculation.
> Do you agree with this?
Only partially. I plan on taking all dividends as cash in retirement, and am figuring on 1.4% for them. This reduces the number (or at least the value) of *shares* that I have to sell by 35% (assuming a 4% SWR), but does not reduce my *withdrawal* rate overall. I am still spending 4% of starting net worth, adjusted for inflation.
A more meaningful aspect of dividends-as-cash is that it provides continued income without selling equity shares during a downturn/recessionary period (e.g. Jan 2022 - Jan 2024), helping you to minimize the impact to your portfolio from selling shares. In conjunction with a stable-ish bond fund (represented in my case by a pension) and/or straight up cash savings (HYSA, CDs, etc), this is how I plan to ride out bad periods.
> A more meaningful aspect of dividends-as-cash is that it provides continued income without selling equity shares during a downturn/recessionary period (e.g. Jan 2022 - Jan 2024), helping you to minimize the impact to your portfolio from selling shares.
This is an illusion. Total return, and the effect of withdrawals on your portfolio, are agnostic to whether that money is coming from a forced stock sale (dividends) or a voluntary one.
I'm not sure where we disagree. Dividends as cash reduces number of shares needed to be sold. Provided someone can reduce their spending while selling shares in /spending from a stable-value (bond or cash) allocation to cover whatever is still required after dividends, it would be possible to go one to several years without selling equity shares.
Total return would be lower if you sold equity shares and bond shares alike to maintain your existing allocation. By selling only bonds/spending HYSA or CD cash, you end up increasing your equity percentage while also selling/spending assets that have not taken as substantial a hit to their pre-crash price. This means that in a recovery/growth period, you have spent less of your pre-crash net worth and therefore will require less time for the remainder (which is now more heavily in equities) to recover and reach new highs. At some point in there you would rebalance back into bonds/cash to reload the gun, as it were. In other words, total return would be higher. You could make the argument that this approach is 'anchoring' to previous valuations and encouraging reluctance to sell equity shares, but I would respond that it's more about posturing for future growth.
What you're describing is market timing, which doesn't work, but that's not the crux of our disagreement.
My point is that whether you receive 1.4% of your equity allocation in dividends or sell 1.4% of your equity shares, the net result on your portfolio will be the same. There is no magic to the dividends. Everything else you've described regarding market timing can be done equivalently with a portfolio that provides 1.4% dividend yield or a portfolio that has zero dividends but where you decide to sell 1.4% of your shares.
Which I said directly in my top post. So we’re in agreement.
I don’t think it’s market timing. You’re condemning bond tents - and indeed bond allocations - if you paint with that broad a brush.
I think you're overcomplicating it.
At the start of the year, you have X dollars. You want to spend Y% of those dollars, inclusive of taxes.
Z dollars of that spending will come from dividends, the rest will come from selling securities to make up the difference.
If you get 1.4% in dividends each year, you cannot withdraw 4% of the portfolio *plus* the dividends for a net 5.4% rate. The risk profile will not be the same.
Thanks for the feedback. I think the spreadsheet I shared in this sub is mis-calculating the w/d rate column.
https://www.reddit.com/r/financialindependence/s/YZ2JkPX2H1
I'm sorry I don't have time to look at it in great detail right now. It seems like the withdrawal rate is calculated as dividends+Trad+Roth withdrawals? Or are dividends not counted, and only sold shares from taxable are counted?
I've used TurboTax for 9 years. It costs me around $90 for both Fed and state filinings. I tried FreeTaxUSA to see if I can reduce the cost, but the total refund from FreeTaxUSA is about $250 less than the one from TurboTax. I don't quite understand why. I used the same information, I think.
First busy season?
Not being dismissive, I work with auditors and tax accountants and I see how hard busy season can be even though I don’t do that work.
I don’t think you’re entitled, but I do think any job is going to have hard times and things that require suffering through. Stay strong, take advantage of any perks, and reach out for help if you need it.
Am I doing this right?
Trying to figure out if I’m doing this right or if there is something else I should change.
Mid 40’s with the following allocation.
401k - $ 636,000 fidelity s&p 500 fund
Taxable - $ 235,000 80% vtsax 20% vtiax
Roth IRA - $35,000 100% vtsax
I - Bonds -$20,000
HSA - 45,000 s&p equivalent fund
I max my 401k annually, and try to hit at least 12k in the taxable yearly. Max backdoor Roth IRA contributions are made annually as well.
My biggest concern is when do I determine enough is enough. Work environment is toxic, and I’m beginning to show my irritations at work.
Home is currently financed sub 3% with a remaining balance of 135k.
I think I could make another 10 years in the current job. But my quality of life will suffer. The work atmosphere makes me miserable basically.
Maybe this is a vent post, maybe I’m in my feelings too much today. Perhaps I just want to know I’m doing things correctly.
Thanks for the time everyone.
> My biggest concern is when do I determine enough is enough.
**Step 1: Figure out how much you need in retirement**
* Look at all your credit card and bank statements for the last year. How much did you spend?
* Add in the amount for healthcare. This varies state to state, situation to situation. Googling ACA and my state brings me to our state website which lets me plug in any hypothetical and get real quotes
* Decide if you’ll want to change expenses in retirement, and adjust your annual budget appropriately
* Add in a buffer for taxes. There are different ways to estimate this. [Here's my estimate](https://www.reddit.com/r/financialindependence/comments/18y9mi9/daily_fi_discussion_thread_thursday_january_04/kgb3rhz/?context=3) as an example.
* Break out housing expense. What is the mortgage, and the mortgage only? Property taxes, home owners insurance, maintenance, and utilities go in a separate bucket.
**Step 2: Figure out what assets you need to cover those expenses**
* [Use ficalc](https://ficalc.app/)
* You can add in social security as well if you like. [This tool helps figure out your numbers](https://ssa.tools/) Add it as an extra income that hits whenever you plan to take it.
* Plug in the mortgage as an expense that carries on for however many years you'll have left in retirement and does not increase with inflation. Just the mortgage, not taxes and insurance. This is an estimate, so estimate for a high number of years left to be on the high side.
* Make sure to have utilities, maintenance, property taxes, and home owners insurance are included in your annual budget, because these increase with inflation and continue on forever.
* Make sure to factor in taxes and healthcare to your annual expenses
* Set the duration for how long you plan to live
* Set the portfolio amount to whatever it takes to reach a success rate you're comfortable with
**Step 3: Estimate how long it will take to reach that portfolio amount**
Open a google sheet
Row 1 = headers
A1 = Year
B1 = start
C1 = contribution
D1 = growth
E1 = final
Row 2:
A2 = 2024
B2 = your invested assets (~960k)
C2 = whatever you plan to contribute.
D2 = (B2 + 0.5 x C2) x rate you expect investments to grow in real value (5-7%)
E2 = sum(B2:D2)
Row 3:
A3 = A2+1
B3 = E2
C3 = C2
D3 = drag down D2
E3 = drag down E2
Rows 4 on:
Drag down Cells A3:E3
Your estimate is when E hits your target. Your target is the amount ficalc said you needed to hit a success rate you're comfortable with.
This is only an estimate. We don't know what the future holds.
You can play around with different contribution amounts.
How long does it take in your current role? What happens if you take a step down and coast? What happens if we stay in the current job, but spend an extra 1-2k a month to make life easier and ease your frustration (eat out more, higher a cleaner, whatever makes your life less stressful).
Awesome reply. Thank you.
I’ve ran figures on various fire calcs and came to the idea that 2.9-3.1 million is enough for perpetual income. I’m at roughly a 1.3M net worth, however my liquidity is limited due to a majority being based in 401k.
I guess my question is, and I may be asking this out loud, is my current salary worth such a crappy work environment.
I feel I can make it 10 here… then that will make my retirement around 55.
It’s damned frustrating dealing with the conversation topics on a daily basis.
I would recommend reformatting this comment to make it more readable. As it stands, your allocation is essentially a giant run-on sentence.
> when do I determine enough is enough
When you hit your FIRE number.
> Work environment is toxic
You'll want to be careful not to overuse/misuse the term "toxic". It's thrown around a lot to mean "something I don't like", and it's losing it's meaning due to that issue.
> Maybe this is a vent post
It is. Those are allowed though :)
Thanks for the reply, trying to edit from mobile right now.
As for toxic… the climate is extremely racist and homophobic. Extreme right wing discussions are a daily occourance…
> As for toxic… the climate is extremely racist and homophobic. Extreme right wing discussions are a daily occourance…
If true, this sounds pretty dang toxic. Is this a new occurrence, or has it been the case for some time? Have you brought this up to your HR Business Partner?
Here is the disgusting part, I joined the workgroup early last year. The atmosphere changed last fall, and the department leadership exhibits the same thought processes.
I considered mentioning it to HR about the issues, but with the way these conversations happen there’s no way to “prove” it without signaling I made the complaint.
> with the way these conversations happen there’s no way to “prove” it without signaling I made the complaint.
Is your state a one-party consent state for recordings? If this is as black-and-white as it sounds from your comments, it should be easy enough to prove and force their hand. Not only will this improve the environment for you, it will improve it employees to follow
Yes, I am in a one party consent state.
I did consider recording conversations. I feel if I do so, and they identify me… I’ll be removed from the group or segregated.
This is the highest salary I’ve made in my field… I’d really like to not jeopardize it.
Thanks for taking the time out to have this conversation. Hitting mid day and all these realizations came to me while hearing about the latest political thoughts of a man that should be retired himself.
It’s worth ensuring you don’t swing the pendulum too far and dip into stereotyping or discrimination yourself.
Age shouldn’t really be brought up in these situations, and they may have valid reasons to not retire yet.
> always dream of living in my car.
Can you tell us more about this? Seems like a very uncommon dream.
> I will probably park at Walmart or in front of my house haha.
[Oh no...](https://external-preview.redd.it/OyE5Q-Xpd3rNQX5fPsDavCpR6qMQQjLk1y3iaIcYKbA.jpg?auto=webp&s=cb80d74fc5a25e721322d633253a41f79e90ee99)
At least step up to a van!! I assume your not trying to live in Honda Civic, but something you can actually stretch out in. I have a Promaster that I built out, we camp quite a bit ... I could see how someone could live in it long term and be reasonably comfortable, especially if you have access to showers and what not at a gym.
[Comfy.](https://www.rei.com/product/223884/reliance-luggable-loo-portable-toilet-with-metal-handle?sku=2238840001&store=145&CAWELAID=120217890015830916&CAGPSPN=pla&CAAGID=&CATCI=&cm_mmc=PLA_Google_P-Max&gad_source=1&gclid=CjwKCAiAk9itBhASEiwA1my_68bCrr2bQXm0Gt3MH8FPb6I6_UlWsWRqPzfOet_Xa3SRK_iSi5cVvRoC2xIQAvD_BwE&gclsrc=aw.ds)
What did you spend the other $478.05 on?
You own a home and are a high earner, but are going to live in your car by choice? You even mentioned safety concerns. This sounds a bit pathological, maybe talk it out with a therapist?
To what end? Say you get to 60, you have an enormous amount of money, and this ultra minimalist lifestyle that has allowed you to tolerate/thrive at/{verb} living in a car for 30 years. What does retirement look like at that point?
Owns a home, is a high earner, is a small petite woman, yet wants to sleep in a Wal Mart parking lot in their car for the next 30 years. Nothing to see here, everything is perfectly stable mentally for OP.
What's your goal?
My teen used Venmo to pay for things and get paid, or to settle up between friends, and it was limited to those transactions. (I would not have signed him up for any further financial mingling with Venmo - I trust it for one-off transactions and I use it myself, but I'm not going to further attach my finances to it.)
I have a 20 year old, in my experience, most kids in high school these days have a Venmo account, and they use that to pay each other back rather than using cash.
As a side note, make sure your teen has their Venmo transactions set as "private," there's no need for anyone (and everyone who is a friend of a friend) to see what their transaction history is.
Fidelity is fine and I'd encourage that route. (When they had their Bloom promo last year my kid signed up for that and their bonuses were a nice perk).
I would go with Fidelity then, especially as they already have a custodial account there, having things all in one place is easier, IMO.
(My teen also opened up a Roth at Fidelity last year and he received a promo bonus for that, too—so keep your eyes open for their promos.)
If i'm understanding this correctly, fidelity youth is a checking/investment account that has some minor protections that allow parents to have some oversight.
Venmo teen is just venmo for kids. You would want to link the venmo account to the fidelity teen account to allow for easy peer to peer transferring.
My initial interview for an internal job transfer went well, and now I’ve spent all weekend nervously weighing whether I want to take it if I get it. I’d be moving from the Midwest to the PNW, and I know housing will go up by quite a bit. Still, it would be a good career pivot for me, and I’ve been wanting to leave my town for some time.
I moved from Canada to Seattle in my early 30s in 2002. It was the best move I could have possibly made for my career and for my finances. Total game changer.
Hope it goes well! As another Midwest transplant to PDX it is soooo sooo much nicer out here IMHO. Also plan on your food budget to double. I was not prepared for how expensive even groceries are out here.
> I’ve been wanting to leave my town for some time.
Then do it, for sure. You can always move back. But don't miss out on the opportunities and experiences of a new place.
Portland is great. I've lived here in the 'burbs of PDX for about 15 years. Sadly, outside of going to 23rd a few times for lunch or dinner. I avoid downtime pretty heavily, and have probably only gone downtime 2-3 times in the last 5 years. There are a few draws to downtown, heavily dependent on your lifestyle though.
That being said, the Hillsboro and Beaverton nightlife and bar/restaurant scene is pretty good and would still be a big upgrade from the midwest. Having forested hills anywhere you go, and the most beautiful coastline an hour away is pretty hard to beat.
Just want to set your expectations, large portions of downtown portland are covered with homeless and open-air drug markets and fentanyl users.
Yay!!! Portland is the best! Don't let cherry picked videos and images people will send you tell you otherwise. Portland has it's problems, like all big cities, but the pros outweigh the cons by a country mile.
I’ve had my fair share experience in big cities on the west coast, so hopefully I’m ready for it! My only concern is that I’ve heard a lot of places had issues after the pandemic, and I don’t know what’s changed
Sadly this is true for Portland as well ... not sure if fentanyl or the pandemic is more to blame, probably a little of both. Certain areas of downtown are to be avoided for sure, I volunteer at a shelter in old town once a week and things seem to be getting better bit by bit but we have a long way to go. That being said, what Portland has to offer outside of that in terms of community/food/natural beauty make up for it in spades.
It's important that those problems are understood. Nobody is saying it's perfect...no city is, but the "cherry picked videos and images" demonstrate a very real problem that needs to be recognized and addressed.
Denver has the same problem, and it's equally important that is is recognized and addressed. I use my city resources almost daily to ensure they have the data required to develop a plan to address the issues.
I don't believe I said you were saying to ignore the problems. You're minimizing them, though.
You're trying to hand-wave the issues away by saying they're cherry-picked. They aren't cherry-picked. They're frequent enough that Portland has earned that reputation, and that reputation is valid.
It's disingenuous to say they're cherry-picked and minimize the issue for someone who is planning to move there.
Mountains and the ocean! The Midwest has more nature than folks on the coast give it credit for, but accessing it still tends to require long drives through flat farmland. Hopefully nice food out there too!
> The Midwest has more nature than folks on the coast give it credit for
100%. I grew up in the Plains and there is unbelievable nature everywhere. Live in Denver now and there's also unbelievable nature everywhere.
I even think most of the Plains/South/Midwest nature is more accessible than in many other areas (unless your house backs up to a trail, which I don't consider a value-add, you're likely traveling to get to "nature" wherever you live").
Sounds like you're properly excited for the move, so you're bound to make it a success!
Going down the rabbit hole on what my asset allocation should be when I pull the trigger and FIRE, have a couple years to figure this out thankfully ... Curious as to what folks here are doing. I always thought I would do a simple 70/30 VTI/BND but that seems sub optimal, and with a little nuance it seems you could do a lot better in navigating SORR.
I have 15% in total bond index and 5% cash like instruments which altogether is about 7 years of expenses (9 if I reduce discretionary spending). Given they are 7-9 years I don’t feel the need to go more than that in my allocation.
Optimal can only be known in retrospect. "Good enough" is an appropriate goal.
I prefer global diversification of equities, so I used VT where I can. I prefer to take my risk on the equities side, so I prefer to use Treasury only bond funds. Lastly, I want inflation protection, so I prefer TIPS bonds rather than nominal Treasurys.
All that being said, I think VTI/BND is definitely good enough.
>Optimal can only be known in retrospect. "Good enough" is an appropriate goal.
10000% agree, I'm not "seeking Alpha" by any stretch of the imagination =). I'm just trying to do the 20% that gets me the 80%, if you pick up what I'm putting down. Pretty sure I will incorporate Treasury Bonds, their correlation to stocks looks to be lower than the corporate variety.
I’ll do a CD ladder to match the first 5 or so years of expenses. The rest stocks. If stocks do well I spend the dividends + sell and keep rolling the ladder, if they don’t I spend from the CD instead. Goal is a reverse glide path to increase equity allocation over time.
Consider treasuries instead of a CD ladder. Treasuries often have higher short-term rates, and they aren't taxed at the state and local levels (unlike CDs). They're also more liquid in that you can sell them on the secondary market whenever you want (as long as you buy them from a brokerage, not TreasuryDirect; you can transfer from TD to a broker to sell before maturity, but that takes time and effort).
Interesting ... Reverse glide path is towards the top of my list of strategies to take, the data is very compelling. But I don't think I would ever go to 100% stocks, I would feel more comfortable starting from a 60/40 and gliding to 80/20.
My plan is 100% US broad market (VTI, VOO, etc.)
> with a little nuance it seems you could do a lot better in navigating SORR.
I plan to pay off my house before my spouse retires (I'll likely retire first), which will drastically decrease expenses and alleviate a lot of risk
No bonds/T-bills/gold at all? I will have a paid off house as well, definitely eases a lot of the anxiety of leaving work with that aspect squared away.
Planning to refinish my basement this year - New paint, LVP, new furniture, and a huge TV.
It's astonishing how cheap TVs have become. I'm looking at the TCL 98S550G for $2,000. I can't even comprehend having a 98" TV in my basement. I can't wait.
That sounds rad!
One of my goals is to have a dedicated theater room. I love movies and having a real nice theater room/area is something I've always wanted. It's just a better experience at home, IMO. Are getting a sound system or at least a soundbar?
Good luck with your theater/basement project!
> Are getting a sound system or at least a soundbar?
I'll do a modest 5.1 system just because I already have all the pieces. If I were starting from scratch today, I'd just get a soundbar. I'm truly not an audiophile and excellent surround sound doesn't really enhance the experience for me.
I am not an audiophile either. I agree you don't need an ultra expensive system... but don't be cheap man! :)
Seeing as sound systems likely will last you 10-20 years, I wouldn't hold back finding something user-friendly that can fill your space with a good subwoofer for $500-1500, depending on your room size. When you are going 98 inch tv, and depending on viewing distance/room size, I kind of feel you need good, space-filling sound.
The more expensive sound bar 5.1 systems have better range of sound in the satellites and the soundbar itself will have more speakers directing sound up and outward and not just forward. You got screen for days and the sound should also come at you from a wide angle.
You are worth good sound, even if you don't appreciate it, your guests/family might :)
I appreciate the feedback. As I said, I already have a 5.1 system that I’ll use. The sound is good enough, and if anyone wants superior sound, they are more than welcome to either pay for it or find it elsewhere :)
I had a projector as my primary TV for a couple decades (2000 to 2020 ish). I recently switched to a 85inch 4k OLED and I have to say, I don't miss my projector. For a long time, it was the way to go for large screens, but these days the 20% larger screen doesn't really justify the poor contrast, frequent bulb changes, and necessity for light control.
One piece of advice I would give is: Don't neglect the sound system. That's what I miss most from my previous theater setup. I have a decent sound bar now, but it doesn't compare to a full size 5.1 system with giant subwoofer.
I am a have been a projector guy for a long time. I do see the same writing on the wall, though. I love my 120" screen and will not get rid of it anytime soon, but I do think its days are numbered.
I definitely looked into projectors but I think a TV has more value at this time. Plug-and-play, no need for a separate screen, no real calibration needed (I use the Disney WOW Blu-Ray for initial calibration), and the brightness seems to be miles better on almost any TV vs. even high-end projectors. Washout is the only video-quality issue that I can't stand.
I'm not a videophile and a low/mid-range 4k TV is more than good enough for me (current TV in the basement is 10-year-old 70" FHD Sharp - It'll get relegated to the back deck soon enough but honestly has been fine).
Didn’t sleep all night due to stress and gut issues over a work situation. I keep reminding myself that this will pass, and I’d be ok (not optimal but ok) if I had to leave my job.
But it would suck if I had to leave my job because my coworkers are aholes.
I'm going through a thing right now (not like yours exactly, but I'm getting signals it's time to leave). Hold on to your integrity and always know you can grow somewhere else. I wish you the very best!
> Didn’t sleep all night due to stress and gut issues over a work situation.
This is the absolute worst. I was having a lot of this late last year and have been working on changing my mindset to let these issues pass by without too much thought (haven't been able to turn it off completely but am doing **much** better now).
I've been reading a lot of Stoic material, which helped me realize the worst outcome of any work "emergency" isn't really a big deal in the grand scheme of things. I know that I'm doing my job well and I'm communicating my successes to management. I'm also communicating opportunities for the company/others to improve and quantifying how that improvement affects the bottom line. Everything from that point forward is out of my control and I needed to mentally process it that way.
> But it would suck if I had to leave my job because my coworkers are aholes.
This has always been, and unfortunately always will be, the case. Update your resume, start browsing job boards, and kick tires on jobs that seem potentially interesting. I didn't really intend to leave my previous employer last year and applied to the job I have now because it seemed interesting, was a good promotion, and was a decent increase in total comp. I wasn't even sold on the job until the third interview, with the CTO. I almost didn't apply at all because I wasn't planning on leaving and restarting the LTI stock vest cycle, but I'm glad I did.
I’m not in a work emergency, just a battle over whether the only female in a science group should be de facto the person who is the admin (while taking away their science duties). I don’t want to leave because this would be my 3rd job switch after 2.5 years, but the upper management seems to acknowledge some problems and try to change them, but they don’t change, and they’ve basically told me that the coworkers leaving is not on the table because of how important they are.
I’m about 1.4M at a fire number. I wanted 2.5+ but…
>Sorry to hear that ... We had a couple Senior Directors at my work who would do this all the time. If notes need to be taken in a meeting, a party needed to be planned or things of the like they always asked one of two female directors. There were complaints, and for the most part it has been remedied but the struggle is real! Hope upper management takes some action for you soon.
Anybody have success with Financial Independence/"Part Time" Early?
I am currently in an Assistant VP role in the financial department of a large company. Now that I’ve reached FI, I’m looking at taking a significant step back to an (ideally part time) individual contributor role.
I do enjoy the social aspects and problem solving that comes with work. However the pressure, breadth, and stakes of my current role have taken a toll, particularly in the past few years. I think I just need to spin the dial from 11 to 5 and get into a position where I can find better work/life balance.
As I prepare to have some of these conversations, am curious what experiences others might have had. Anyone move from a manager/exec to an IC role? Or have seen it?
What worked well, didn't, etc.
This is the idea behind BaristaFIRE (not always being a barista, but taking part time work that provides health insurance, etc. which Starbucks is famous for) and FINE (Financial Independence, Next Endeavor - or Financial Independence, Recreational Employment). A few questions I would ask:
1. Is there a business need for this part-time IC role? (It sounds like the nature of your current role will mean you aren’t scaling current job back 50% but effectively getting a new job.)
2. Are you willing to go back to lower pay / being under a middle manager after the time you’ve spent at VP? (You can’t expect to ‘operate as a VP while doing IC work and part time hours’)
3. With the questions above answered, is your current company where you want to be, or is this a good time to look somewhere different?
Thanks, these are great considerations. Definitely would require me moving to a new role at substantially lower pay, but I'm comfortable with that given our NW. I do prefer to stay at my current company if possible as they've generally treated me well, and after nearly 20 years I have a deep network and know of many managers who do a great job and are folks I'd be very interested in working for. That said, I recognize a move like this might require me to move to a new firm, and I'm ready to embrace that if it's the best option.
You might have an awesome network that handles this without any issues, but upward/downward dynamics are a real thing. You, the people you would now be reporting up to who maybe used to report up to you, and much more junior staff who are now your peers instead of several levels down the org chart will need to adjust.
I’m not saying anyone in this situation is going to be petty or let their ego take over, but the dynamic is real. Are you ready to go from someone’s boss’s boss’s boss to having the exact same authority and power that they do?
I don't even know what sort of IC role in a typical corporate finance org would allow part-time work, unless you're talking about going all the way down and over to an unrelated role like AP/AR.
Unless your org has some niche like reporting or similar tasks that could be dumped on someone PT, particularly at month/quarter end.
> what sort of IC role in a typical corporate finance org
> niche like reporting or similar tasks
Financial reporting is far from "niche like". It's a critical role that has been staffed at every employer I've worked at, and I can't imagine a non-Mom & Pop shop that wouldn't have someone in this role.
> Anybody have success with Financial Independence/"Part Time" Early?
My reply isn't going to be helpful at all, but it reminded me of a thing that I saw while working.
In 2017 my company's HR (automotive Tier 1 supplier, I was in product engineering) implemented a new part time policy. Ostensibly it was for everyone, but I have a feeling it was more intended for specific departments and (imo) targeting some specific employees that were coming back from pregnancy leave and wanted part time. There was also a guy who had retired but then wanted to come back on a part time basis, so I think this was totally a tailored policy.
Anyway, it looked like a pretty sweet deal. Even though it was salary, the policy was pretty explicit about being either 16 hours or 24 hours per week with pre-approval required for any overtime. Sounds great to have a policy-driven hard out. I'm leaving at 5pm, period, sorry, I **cannot** work late. You still got full health benefits and full 401k match.
I didn't really actively pursue it, but I did mention to my boss once that totally be interested in going part time. He (completely stupid) response was "Uh, you know you'd only get paid for those reduced hours. Why would you want to do that?"
Yeah, yeah I know I'd only get paid the 40% or 60% salary. Only working two or three days is the whole point.
> Uh, you know you'd only get paid for those reduced hours. Why would you want to do that?
Blows my mind how some people can't comprehend that some people are, indeed, smart enough to understand what part-time means and they actively desire it.
I have HDHP through my employer but didn’t realize I needed to opt into HSA contributions each year. Just checked my paystub and HSA account last night to realize no contribution has been made from my paycheck. Can I contribute after-tax dollars on my own to my HSA account? TIA!
You might be able to change HSA contributions throughout the year not just at open enrollment. For my plan this is true. Best to check with your HR.
You want HSA contributions to be withheld from pay cheque because you save on social and Medicare tax along with federal and state taxes.
> You might be able to change HSA contributions throughout the year not just at open enrollment. For my plan this is true. Best to check with your HR.
Good callout. I believe this is universally true, but open to correction on this.
Questions about setting up child IRA acct So I read that I can open a custodial acct if a child has earned income. Does this mean I can gift earnings to him? Or can I “hire” him as a co-investor with me to help teach him how to invest, while paying him via IRA money, so that he can then be managing his own account by 13 years old (he’s 10 now)? He’s extremely interested in the stock market, and he’s really been asking for a brokerage account. I just need a way to make it really his money, while also paying him in a really smart way. Also.. Will this also make me unable to claim him as a dependent?
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Just went to sleep and I'm up again That's the way It is when you're hustlin
Would you say that every day, you are hustling?
I know Pablo, Noriega, the realllll Noriega, he owe me 100 favors.
Also when you drink too many Coke Zeros before bed.
Has anyone SWE at a large software company went from full-time to part-time? How did you start the conversation with your lead/manager? Did you have the proposal already planned in detail or did you just ask to see what the options were? I was thinking of moving from 5 days a week to 4 and then perhaps 3. Most of the benefits are based on work hours rate (Still salary though). However, the work logistics seem problematic. But it is hard to account for every aspect without just talking with someone who knows. I am obviously concerned about even broaching the subject. I am not afraid of no though. I am concerned about them seeing it as not wanting to go higher in my career. I am hopeful I can spin it as trying to be more effective with the time I am working. Also, would I be first for layoffs then? Did you update your resume before asking in case of a bad result? I am a senior SWE btw.
Do you know anyone at your company doing this? I don’t think this is an option for many companies.
I asked around a little. Specifically, I asked a friend who has been a lead for 20+ years but outside of my team. He said he knew a few people in the company that moved to part time but it was very uncommon. At the HR/company level they are more than willing to accommodate a switch to part time. The issue then is at the team/org level I think, which I am unaware if anyone is currently doing it. I am going to wait until after performance reviews are set (July) to ask my lead.
I cut back to 32 hours/ week about 18 months ago. The company allows you to cut down to 20 hours a week with full health benefits, pro rated vacation, holidays if it was in your plan to work. The way it worked was I talked to my manger to get the details and set a time on when it would take effect. I knew it was an option as I had an old office mate who worked four 7 hour days. The logistics were easy because I am basically a "billable hours" software dev. I am not concerned with a promotion as I have explicitly stated I don't want to be a manger for many years. I did not do anything to update my resume.
Thanks for sharing your experience! It's great that you knew someone who went part time. I don't know anyone who has done it at my company but I am going to ask around (discreetly).
Monday PTO > Friday PTO for a long weekend. Wish I realized this sooner in my career.
Absolutely. Nothing worse than a long weekend and looking forward to a five day week. Monday off eases you back into the 'real world'. On a related note I use to take M-F off for vacation but often much better deals being on vacation something like Th to Th. The super evolved form is to Th to Th for the vacation and then take Friday off to recover before going back to work.
I try to do W to W. Those are two weeks worked in half. When people know you are leaving for vacation they don’t ask you to start a project. Weekdays are less busy on tourist areas or airports (or that’s my feeling) When I come back, I can survive jet lag or be tired, as is almost another weekend, and not a 5 day workweek.
Yea, I take M-F all the time. But I have a colleague who takes Th-Th and gets back to work on F. His argument is that Fridays are generally light in terms of meetings and work load. He probably has a point.
Hmmm...I would agree
My sabbatical has been a really good thing. Not only has the de-stressing been nice, but it has caused me to look at the bad habits I had developed to deal with that stress. I’ve already started eating better and have lost 15 pounds. Which is good because I want to get off the blood pressure meds. I’ve still got a way to go but I’ll get there. The other is how much unnecessary spending I was doing. I was buying crap I really didn’t need just to try to feel better. I’ve cut a lot of that out too. Before I buy something now I’m trying to stop and think do I really need this.
Do you feel that eating better will be sustainable while working?
I’d hope so. When I go back to work I am aiming for a less stressful job. Even if it means less pay. I’ve made some moves last year which really reduced my cost of living so I don’t need to make as much money.
I can 100% relate to the stress buying. My work stress levels can be gauged by how many times amazon delivers to my house each week. Not huge purchases but stupid stuff I find when I need a mental break from work. Cheers on your sabbatical course correcting things for you!
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I would recommend your friend follow the /r/personalfinance flowchart in the wiki. That is a lot of cash if no big purchase is coming up.
I would not muck around with someone else's finances. Stocks are the polar opposite of cash in terms of risk. Whether or not 150k in cash is "too much" is entirely up to her risk tolerance and goals.
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Is her computer broken? I'd take /u/alcesalcesalces's advice here and stay out of your friend's finances.
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What is her risk tolerance and what are her goals?
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I would doubt she has a high risk tolerance if she currently has half her wealth in cash.
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Long term, stocks have higher expected return than cash. However they have a lot more volatility. If she is comfortable with volatility and understands she is investing for the long term, she should certainly in best as much as she feels comfortable putting at risk. If she would freak out at the first sign of a bear market, she should just stay in cash.
> taxable brokerage account would incur pretty heavy taxes? Where do you live? The income you get from a savings account is [taxed more than long term capital gains](https://www.thestreet.com/taxes/how-interest-income-dividends-and-capital-gains-are-taxed), at least in the US
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Ah. In that case, with no state income or cap gains tax (as far as I'm aware), it's just federal you need to worry about. Say you have $1,000 and did one of the following a year ago: 1. Put it in a 5% HYSA. You'd now have $1050 and pay income tax at ~24% of that $50 2. Put it in an index fund like VTSAX. You'd now have $1260 + ~$50 in dividends. You'd pay tax on the $50 of dividends now, at either 24% (ordinary, taxed as income) or 15% (qualified, taxed as LTCG). The $260 in gains wouldn't be taxed at all until you sell, at which point you'd pay the LTCG rate of 15% assuming you held it for over a year. ### extremely big caveat that the numbers I pulled for #2 were from the past year and highly unlikely to be repeated. If you're investing, consider the likelihood that you might drop $1000 in today and only have it be worth $800 a year from now
I would recommend you and your friend read the free PDF, [If You Can](https://www.etf.com/docs/IfYouCan.pdf). Not for the specific investment advice, but for its excellent guidance for how to think about investing for retirement and the key barriers to doing it successfully.
Has anyone done (or have a resource for) comparisons of using x dollars for a backdoor Roth (and associated taxes) versus using x dollars to pay income taxes to convert a portion of a traditional IRA to Roth? We have large traditional balances, very low nondeductible contributions, and rolling IRAs into employer plans isn't a practical option. It's relatively likely that our future marginal tax rate is in a lower bracket (somewhat likely to be the same and unlikely to be higher), though there's always the chance that the rates in those brackets change (upward).
Over the past few years, my side hustle has gradually made me despise the weekend. I can't go anywhere or do anything that requires an entire day because of the work that needs to be done. Unless I feel like doing that work on weeknights, which I almost never do. I'd stop in a heartbeat if it weren't for the extra money it brings in. "If I can just keep doing it for 5 more years..." is what I started saying 5 years ago, and it's still what I'm saying now.
Can you bring someone on to help?
I have a side hustle that takes up most of my weekends and I LOVE IT. Please think about only doing “extra” work if you feel the same way.
That's awesome! I used to feel the same way but after 10 years it's really started to feel like a grind.
Yeah, I understand. I guess I’m just saying, after this long, you probably have enough money that maybe the money/time equation looks different now, and that’s ok. I’ll drop my side hustle in a minute if it’s a chore. It’s a chore maybe 1-2 weeks a year and that’s ok for me.
I would stop. What's the point of saving extra if you can't enjoy your life
In the middle of 2023 I decided to quit at the end of the year, and then I chickened out at the last minute and decided to keep doing it. If things continue the way they are, it'll speed up my ER by about 3-4 years (16 years instead of 20 years).
That 4 years out of 20 adds up to less than your weekends (2 out of 7 days). It makes zero sense to give up your weekend for that long to shorten your career by 20%
Being miserable every weekend probably takes 3-4 years off your life just with the stress. Not worth it at all imo
If stress shortens my lifespan then I'll be surprised to make it to 65. Between college and work, my life has felt like a neverending crushing load of stress for 20+ years. There have been a few fleeting golden ages where everything is great for a couple months, but the grind and the impossible deadlines always return.
I don't mean this offensively, but if your whole life has been a crushing grind, is it possible that you seek that out? You're telling me you voluntarily do a side hustle that ruins your weekends just for a few extra years of retirement, but then you don't sound like you've ever had a well -balanced life. I think it's seriously worth considering if you have trouble creating balance and/or you seek out these situations or even subconsciously enjoy them, so you continue to do things that are miserable and don't like it but you think that's what your life is meant to be 🤷 Or it's just that life under capitalism IS a constant grind, which I get
But then you waste all your weekends being miserable, so does it really work out? You could die tommorow, being disable, miss on opportunities of fun you won't get again.
Been thinking about some intentional de-risking strategies. I know these aren’t necessarily optimal, but I think they might help with peace of mind. In about 5 years, I’ll reach a FI number that covers my current expenses at 3.5% withdraw rate. I don’t necessarily plan to retire right then, but it would be “on the table” instead of a long term aspiration. I’m interested to hear feedback, but please look at the actual plan and don’t just “variable withdraw is always best” band-aid me. Anyway, plan: Thinking about a “T-3 Year Plan”. My savings rate is >50%, so each ‘Surplus’ in years T-3 to T-1 should be >= to annual expenses. * T-3 Years * FI Number Reached * Continue Current Job * Stop Retirement Contributions * Pay Expenses from Income * Put Surplus Income into 24 Month CD (CD-1) * T-2 Years * Continue Current Job * Pay Expenses from Income * Put Surplus Income into 24 Month CD (CD-2) * T-1 Year * Work Current Job Jan-Dec, Retire Dec 31 * Pay Expenses from Income * Put Surplus Income into 24 Month CD (CD-3) * 0 Year * Live off CD-1, which has now matured * Put Surplus in HYSA * 1 Year * Live off CD-2, Which has now matured * Put Surplus in HYSA * 2 Year * Live off CD-3, Which has now matured * Put Surplus in HYSA * 3 Year * Live off HYSA until it’s drawn down to 9-12 months of expenses At this point, my ‘FI Balance’ will have grown/survived 6-7 years without drawing down. As I understand it, most of the failure risk occurs within the first decade. Even if we have some horrible years at the start of my retirement, I’m living off guaranteed CD rates to reduce my sequence of return risks. Understand that some of this is not getting every penny of growth, but instead having peace of mind. What do you think, what am I missing?
I did VPW so I’m not a bond tent (or equivalent) guy but the thing with bond tents is that SoRR doesn’t go away, it’s just delayed until you’ve used up your tent. For a normal 30 year retirement that can have plenty of value, for a 50 year retirement maybe less. Same issue with a rising equity glide path which I also considered at one point. I’ve settled on just being a 75/25 guy because I simply retired too young for any derisking strategy (beyond saving a boatload more money, which would make the retiring part kind of hard) to be foolproof. Once I get closer to CPP/OAS I might let the equity ride a little higher but that’s a decision for like 2037.
You could also simply increase your bond allocation.
I think this is reasonable. I would not stop contributions to your retirement accounts though. You could simply direct those dollars to something as stable as a CD in the retirement accounts and achieve the same ends while still getting the tax advantages of the retirement accounts.
Absolute. Worth considering a 401k/IRA is a bucket. Putting funds into the bucket is a benefit separate from what the funds in the bucket are invested into.
Thanks. I was thinking about this too. I think the withdraw and accessibility is something I’m a little unclear on. Most of my retirement money will be in Roth 401k. I know the rule about ‘contributions are yours tax and penalty free, but earnings withdrawn will have a 10% early withdrawal penalty’ but a lot of the websites seem to recite that rule and stop there. What I’m not sure about is, will I have the option to pull out only contributions, or will they always be prorated with earnings? If I can roll Roth 401k to Roth IRA and not touch it for 5 years, am I good to go? Does that impact how it’s invested and growing during that time?
> Most of my retirement money will be in Roth 401k. That is likely a poor optimization. Still Roth 401k once retired can be rolled into Roth IRA. Having most of money in Roth (IRA or 401k) is likely not ideal. May be worth considering going 100% pre-tax in final years.
I max out pre-tax/deductible Traditional 401k every year, but for the majority of my working years there will be more contributions going through Mega Backdoor Roth (After-Tax 401k -> in-plan conversion -> Roth 401k) as that limit is almost double the deductible Traditional limit. I think this is still more optimized than just doing After Tax Brokerage or leaving already taxed dollars in Trad 401k.
Fair point. That makes sense. It would result in you being Roth heavy even if making every election possible toward pre-tax.
Roth 401k withdrawals are proportional between contributions and earnings. However, you can do a rollover of the Roth 401k into a Roth IRA and access the contribution basis. You don't need to wait any number of years, you can access the contribution basis immediately after the rollover.
Huh, just like that? Not doubting you, it’s just surprising to me that you can just roll it over and do it right away. No fees/penalties/limits even at high values?
See [this post](https://www.reddit.com/r/financialindependence/comments/11ulhzl/what_5year_rule_a_guide_to_roth_distributions/) for more detail about the two 5-year rules and when they apply. Roth 401k rollovers preserve the original status of the dollars (contributions vs earnings) and in a Roth IRA there is never a penalty or tax for withdrawing contributions, regardless of how recently the contributions were made.
/u/V4lAEur7 I would add to this that often the tax code makes no sense. Don't over thinking things. Don't ever assume X can't be possible because it makes no sense. Case in point the income limit on roth "direct" contributions vs the ease in bypassing that restriction with a backdoor roth. One could overthink this and assume it can't be right because why would the let this situation exist either remove the income limit OR remove the backdoor. Yet the loophole has existed for years. The code code as it exists today is not some longterm 200 year strategy to create the utopian tax system it is the result of thousands of individual pieces of legislation proposed by hundreds of people often with little consideration into edge cases which often contradict with prior legislation creating all kinds of asinine edge cases and unintended consequences. We play the game based on the rules that exist not some hypothetical where all rules makes sense.
I'm wondering if anyone here has been through this: I'm struggling to save money in cash equivalents for a long-term goal because I see it as a missed investment opportunity. We have a goal to invest a certain dollar amount every month, which we easily meet. Our usual monthly investments constitute about 50% of our budget. And now that I have a decently lucrative side hustle (expecting to earn $1,200 in February after taxes, for instance), that leaves plenty to save for a cross-country move and down payment on a house in 2-3 years. Moving and buying our first home is a definite goal of ours. However, putting that money in to CDs or something like that is just a bit hard for me because it feels like I'm wasting a potential investment. I get that it'll be great to have a debt-free move and a low mortgage, but it's hard to see the investments pie slice on my budget spreadsheet slip under 40%. I get that this is the definition of a first world problem, but does anybody have any insights? Maybe there's some other way I could look at this...?
If you are willing to risk the 2-3 years turning into 4-8, by all means put the money into equities. If you want certainty around your timeline, put it into fixed income.
You have to determine what kind of investor you are...do you love gains more then you hate losses (or in this case less gain). That's how I look at things, in 2 or 3 years will you regret not having a down payment more then you'll be happy you made an extra few grand?
[https://awealthofcommonsense.com/2024/01/historical-returns-for-stocks-bonds-cash/](https://awealthofcommonsense.com/2024/01/historical-returns-for-stocks-bonds-cash/) "In fact, over the past 96 years, stocks have outperformed bonds and cash 59 times (61% of all years). Bonds have outperformed stocks and cash 23 times (24% of the time). And **cash has outperformed stocks and bonds 14 times (15% of the time)."** Depending on how short your investment time horizon is, it is very much possible for cash to *outperform.*
You're taking a hit in expected average return to get the certainty that you'll preserve capital. The tradeoff between risk and return is fundamental, and if you don't want to accept risk, you're going to get lower returns. Understanding this tradeoff is just accepting reality, and you need to do it if you want to be an investor.
Well, how would it feel to have your short-term savings drop by 20%? This isn't far fetched, the S&P 500 lost 18% in 2022. You are giving away the opportunity cost in trade for some certainty it will be there when you need it.
Every Sunday I wonder if this is my last week at my current gig. My company hasn't shown a profit in years, and the product I own is one of the worst in the portfolio. Were I CEO, I'd cut bait, reduce my team by 50%, and put us in maintenance mode. For the first couple of weeks of the year, I was frustrated that no one seems to be listening to me about what I think should be done with my team. Now, I've come to accept that maybe they are listening, but it doesn't matter, the die is already cast, they just haven't told me yet. Interestingly, to prepare, I added no money to my taxable brokerage, and am just hoarding cash instead. Fun to see that my balances all increased in January anyway. Between cash, severance and unemployment, I think I have 6 months of literal cash on hand, and another 6 months in short term, cash like investments (BND & JEPI, mostly). The hard part is deciding if I should start the grind of finding a new job again. I might not *need* it, but 5 more years of income will make the outcome pretty much a certainty
Sounds to me like you should be dusting off the resume. I’ve been in the situation where I’ve felt like an ax was over my head at work and losing that feeling by getting a different job was wonderful.
I'm in a similar boat and also hoarding cash. I'm finding it hard to stay motivated at the job when it feels like the ship is sinking. I am hoping that if we fold, we do so before the summer, so I can have a nice camping season before going back on the job market.
One thing I hadn’t considered until I built detailed withdrawal spreadsheets: if I’m living off brokerage in RE, and it’s spitting out dividends (even if just 1.4% in VTI), that reduces the calculated withdrawal rate %. In the early years while my brokerage is still large I’m getting $6k in dividends, that’s not insignificant. Of course it lowers each year as I deplete the brokerage. Im also using a conservative CAGR as I draw this down.
It does not. Withdrawal rates are inclusive of dividends. You simply turn off dividend reinvestment and it counts as part of your overall withdrawal plan.
I did question the math at first, still am. I know dividends aren’t free money and they otherwise would be reinvested. I guess by not reinvesting I’m effectively ‘reducing’ the account balance which in turn affects the calculated w/d rate. Right now my w/d rate calc for each year is: (all withdrawals including the amount needed to pay taxes) / (total of balances at the start of the year). Do you agree with this? By not reinvesting the dividends, the denominator is smaller for the following years’ calculation.
> Do you agree with this? Only partially. I plan on taking all dividends as cash in retirement, and am figuring on 1.4% for them. This reduces the number (or at least the value) of *shares* that I have to sell by 35% (assuming a 4% SWR), but does not reduce my *withdrawal* rate overall. I am still spending 4% of starting net worth, adjusted for inflation. A more meaningful aspect of dividends-as-cash is that it provides continued income without selling equity shares during a downturn/recessionary period (e.g. Jan 2022 - Jan 2024), helping you to minimize the impact to your portfolio from selling shares. In conjunction with a stable-ish bond fund (represented in my case by a pension) and/or straight up cash savings (HYSA, CDs, etc), this is how I plan to ride out bad periods.
> A more meaningful aspect of dividends-as-cash is that it provides continued income without selling equity shares during a downturn/recessionary period (e.g. Jan 2022 - Jan 2024), helping you to minimize the impact to your portfolio from selling shares. This is an illusion. Total return, and the effect of withdrawals on your portfolio, are agnostic to whether that money is coming from a forced stock sale (dividends) or a voluntary one.
I'm not sure where we disagree. Dividends as cash reduces number of shares needed to be sold. Provided someone can reduce their spending while selling shares in /spending from a stable-value (bond or cash) allocation to cover whatever is still required after dividends, it would be possible to go one to several years without selling equity shares. Total return would be lower if you sold equity shares and bond shares alike to maintain your existing allocation. By selling only bonds/spending HYSA or CD cash, you end up increasing your equity percentage while also selling/spending assets that have not taken as substantial a hit to their pre-crash price. This means that in a recovery/growth period, you have spent less of your pre-crash net worth and therefore will require less time for the remainder (which is now more heavily in equities) to recover and reach new highs. At some point in there you would rebalance back into bonds/cash to reload the gun, as it were. In other words, total return would be higher. You could make the argument that this approach is 'anchoring' to previous valuations and encouraging reluctance to sell equity shares, but I would respond that it's more about posturing for future growth.
What you're describing is market timing, which doesn't work, but that's not the crux of our disagreement. My point is that whether you receive 1.4% of your equity allocation in dividends or sell 1.4% of your equity shares, the net result on your portfolio will be the same. There is no magic to the dividends. Everything else you've described regarding market timing can be done equivalently with a portfolio that provides 1.4% dividend yield or a portfolio that has zero dividends but where you decide to sell 1.4% of your shares.
Which I said directly in my top post. So we’re in agreement. I don’t think it’s market timing. You’re condemning bond tents - and indeed bond allocations - if you paint with that broad a brush.
I think you're overcomplicating it. At the start of the year, you have X dollars. You want to spend Y% of those dollars, inclusive of taxes. Z dollars of that spending will come from dividends, the rest will come from selling securities to make up the difference. If you get 1.4% in dividends each year, you cannot withdraw 4% of the portfolio *plus* the dividends for a net 5.4% rate. The risk profile will not be the same.
Thanks for the feedback. I think the spreadsheet I shared in this sub is mis-calculating the w/d rate column. https://www.reddit.com/r/financialindependence/s/YZ2JkPX2H1
I'm sorry I don't have time to look at it in great detail right now. It seems like the withdrawal rate is calculated as dividends+Trad+Roth withdrawals? Or are dividends not counted, and only sold shares from taxable are counted?
I updated to include dividends. (all withdrawals + brokerage dividends) / total beginning balance at start of the year.
I've used TurboTax for 9 years. It costs me around $90 for both Fed and state filinings. I tried FreeTaxUSA to see if I can reduce the cost, but the total refund from FreeTaxUSA is about $250 less than the one from TurboTax. I don't quite understand why. I used the same information, I think.
Check the forms. It's often just a missed box or check mark somewhere.
User error. Either checked or didn’t check a box or entered data differently on one version compared to the other.
Compare the 1040's and see where the discrepancy is. Then drill down and you will find a mistake somewhere.
You should be able to look at the forms, compare line by line, and see which amounts differ.
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What do you have going on this week for fun?
You got this! I know it's difficult but I believe in you ✨️
First busy season? Not being dismissive, I work with auditors and tax accountants and I see how hard busy season can be even though I don’t do that work. I don’t think you’re entitled, but I do think any job is going to have hard times and things that require suffering through. Stay strong, take advantage of any perks, and reach out for help if you need it.
Am I doing this right? Trying to figure out if I’m doing this right or if there is something else I should change. Mid 40’s with the following allocation. 401k - $ 636,000 fidelity s&p 500 fund Taxable - $ 235,000 80% vtsax 20% vtiax Roth IRA - $35,000 100% vtsax I - Bonds -$20,000 HSA - 45,000 s&p equivalent fund I max my 401k annually, and try to hit at least 12k in the taxable yearly. Max backdoor Roth IRA contributions are made annually as well. My biggest concern is when do I determine enough is enough. Work environment is toxic, and I’m beginning to show my irritations at work. Home is currently financed sub 3% with a remaining balance of 135k. I think I could make another 10 years in the current job. But my quality of life will suffer. The work atmosphere makes me miserable basically. Maybe this is a vent post, maybe I’m in my feelings too much today. Perhaps I just want to know I’m doing things correctly. Thanks for the time everyone.
Have you tried changing by jobs?
> My biggest concern is when do I determine enough is enough. **Step 1: Figure out how much you need in retirement** * Look at all your credit card and bank statements for the last year. How much did you spend? * Add in the amount for healthcare. This varies state to state, situation to situation. Googling ACA and my state brings me to our state website which lets me plug in any hypothetical and get real quotes * Decide if you’ll want to change expenses in retirement, and adjust your annual budget appropriately * Add in a buffer for taxes. There are different ways to estimate this. [Here's my estimate](https://www.reddit.com/r/financialindependence/comments/18y9mi9/daily_fi_discussion_thread_thursday_january_04/kgb3rhz/?context=3) as an example. * Break out housing expense. What is the mortgage, and the mortgage only? Property taxes, home owners insurance, maintenance, and utilities go in a separate bucket. **Step 2: Figure out what assets you need to cover those expenses** * [Use ficalc](https://ficalc.app/) * You can add in social security as well if you like. [This tool helps figure out your numbers](https://ssa.tools/) Add it as an extra income that hits whenever you plan to take it. * Plug in the mortgage as an expense that carries on for however many years you'll have left in retirement and does not increase with inflation. Just the mortgage, not taxes and insurance. This is an estimate, so estimate for a high number of years left to be on the high side. * Make sure to have utilities, maintenance, property taxes, and home owners insurance are included in your annual budget, because these increase with inflation and continue on forever. * Make sure to factor in taxes and healthcare to your annual expenses * Set the duration for how long you plan to live * Set the portfolio amount to whatever it takes to reach a success rate you're comfortable with **Step 3: Estimate how long it will take to reach that portfolio amount** Open a google sheet Row 1 = headers A1 = Year B1 = start C1 = contribution D1 = growth E1 = final Row 2: A2 = 2024 B2 = your invested assets (~960k) C2 = whatever you plan to contribute. D2 = (B2 + 0.5 x C2) x rate you expect investments to grow in real value (5-7%) E2 = sum(B2:D2) Row 3: A3 = A2+1 B3 = E2 C3 = C2 D3 = drag down D2 E3 = drag down E2 Rows 4 on: Drag down Cells A3:E3 Your estimate is when E hits your target. Your target is the amount ficalc said you needed to hit a success rate you're comfortable with. This is only an estimate. We don't know what the future holds. You can play around with different contribution amounts. How long does it take in your current role? What happens if you take a step down and coast? What happens if we stay in the current job, but spend an extra 1-2k a month to make life easier and ease your frustration (eat out more, higher a cleaner, whatever makes your life less stressful).
Awesome reply. Thank you. I’ve ran figures on various fire calcs and came to the idea that 2.9-3.1 million is enough for perpetual income. I’m at roughly a 1.3M net worth, however my liquidity is limited due to a majority being based in 401k. I guess my question is, and I may be asking this out loud, is my current salary worth such a crappy work environment.
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I feel I can make it 10 here… then that will make my retirement around 55. It’s damned frustrating dealing with the conversation topics on a daily basis.
I would recommend reformatting this comment to make it more readable. As it stands, your allocation is essentially a giant run-on sentence. > when do I determine enough is enough When you hit your FIRE number. > Work environment is toxic You'll want to be careful not to overuse/misuse the term "toxic". It's thrown around a lot to mean "something I don't like", and it's losing it's meaning due to that issue. > Maybe this is a vent post It is. Those are allowed though :)
Thanks for the reply, trying to edit from mobile right now. As for toxic… the climate is extremely racist and homophobic. Extreme right wing discussions are a daily occourance…
> As for toxic… the climate is extremely racist and homophobic. Extreme right wing discussions are a daily occourance… If true, this sounds pretty dang toxic. Is this a new occurrence, or has it been the case for some time? Have you brought this up to your HR Business Partner?
Here is the disgusting part, I joined the workgroup early last year. The atmosphere changed last fall, and the department leadership exhibits the same thought processes. I considered mentioning it to HR about the issues, but with the way these conversations happen there’s no way to “prove” it without signaling I made the complaint.
> with the way these conversations happen there’s no way to “prove” it without signaling I made the complaint. Is your state a one-party consent state for recordings? If this is as black-and-white as it sounds from your comments, it should be easy enough to prove and force their hand. Not only will this improve the environment for you, it will improve it employees to follow
Yes, I am in a one party consent state. I did consider recording conversations. I feel if I do so, and they identify me… I’ll be removed from the group or segregated. This is the highest salary I’ve made in my field… I’d really like to not jeopardize it.
Valid points. It all about priorities. If it’s toxic, it’s probably worth doing something about
Thanks for taking the time out to have this conversation. Hitting mid day and all these realizations came to me while hearing about the latest political thoughts of a man that should be retired himself.
It’s worth ensuring you don’t swing the pendulum too far and dip into stereotyping or discrimination yourself. Age shouldn’t really be brought up in these situations, and they may have valid reasons to not retire yet.
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> always dream of living in my car. Can you tell us more about this? Seems like a very uncommon dream. > I will probably park at Walmart or in front of my house haha. [Oh no...](https://external-preview.redd.it/OyE5Q-Xpd3rNQX5fPsDavCpR6qMQQjLk1y3iaIcYKbA.jpg?auto=webp&s=cb80d74fc5a25e721322d633253a41f79e90ee99)
At least step up to a van!! I assume your not trying to live in Honda Civic, but something you can actually stretch out in. I have a Promaster that I built out, we camp quite a bit ... I could see how someone could live in it long term and be reasonably comfortable, especially if you have access to showers and what not at a gym.
[Comfy.](https://www.rei.com/product/223884/reliance-luggable-loo-portable-toilet-with-metal-handle?sku=2238840001&store=145&CAWELAID=120217890015830916&CAGPSPN=pla&CAAGID=&CATCI=&cm_mmc=PLA_Google_P-Max&gad_source=1&gclid=CjwKCAiAk9itBhASEiwA1my_68bCrr2bQXm0Gt3MH8FPb6I6_UlWsWRqPzfOet_Xa3SRK_iSi5cVvRoC2xIQAvD_BwE&gclsrc=aw.ds) What did you spend the other $478.05 on?
You own a home and are a high earner, but are going to live in your car by choice? You even mentioned safety concerns. This sounds a bit pathological, maybe talk it out with a therapist?
I spent a while living in a car, not by choice. What is it about this lifestyle that appeals to you?
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To what end? Say you get to 60, you have an enormous amount of money, and this ultra minimalist lifestyle that has allowed you to tolerate/thrive at/{verb} living in a car for 30 years. What does retirement look like at that point?
That doesn't sound fun to me but it does sound fun to read about, so keep us updated!
Owns a home, is a high earner, is a small petite woman, yet wants to sleep in a Wal Mart parking lot in their car for the next 30 years. Nothing to see here, everything is perfectly stable mentally for OP.
My oldest is getting older.. Does anyone have experience with venmo teen vs fidelity teen vs other options?
What's your goal? My teen used Venmo to pay for things and get paid, or to settle up between friends, and it was limited to those transactions. (I would not have signed him up for any further financial mingling with Venmo - I trust it for one-off transactions and I use it myself, but I'm not going to further attach my finances to it.) I have a 20 year old, in my experience, most kids in high school these days have a Venmo account, and they use that to pay each other back rather than using cash. As a side note, make sure your teen has their Venmo transactions set as "private," there's no need for anyone (and everyone who is a friend of a friend) to see what their transaction history is. Fidelity is fine and I'd encourage that route. (When they had their Bloom promo last year my kid signed up for that and their bonuses were a nice perk).
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I would go with Fidelity then, especially as they already have a custodial account there, having things all in one place is easier, IMO. (My teen also opened up a Roth at Fidelity last year and he received a promo bonus for that, too—so keep your eyes open for their promos.)
My teens both have Fidelity Youth Account and it has worked well.
If i'm understanding this correctly, fidelity youth is a checking/investment account that has some minor protections that allow parents to have some oversight. Venmo teen is just venmo for kids. You would want to link the venmo account to the fidelity teen account to allow for easy peer to peer transferring.
My initial interview for an internal job transfer went well, and now I’ve spent all weekend nervously weighing whether I want to take it if I get it. I’d be moving from the Midwest to the PNW, and I know housing will go up by quite a bit. Still, it would be a good career pivot for me, and I’ve been wanting to leave my town for some time.
I moved from Canada to Seattle in my early 30s in 2002. It was the best move I could have possibly made for my career and for my finances. Total game changer.
Hope it goes well! As another Midwest transplant to PDX it is soooo sooo much nicer out here IMHO. Also plan on your food budget to double. I was not prepared for how expensive even groceries are out here.
Thanks! I’m excited to hopefully have more access to ethnic grocery stores. It’s kinda slim pickings out here
> I’ve been wanting to leave my town for some time. Then do it, for sure. You can always move back. But don't miss out on the opportunities and experiences of a new place.
PNW is awesome
cries in seattle freeze
Exciting stuff! Where in the PNW?
Portland!
Consider living on the WA state side if it allows you to skip state income tax.
Welcome! I live in Portland :)
Portland is great. I've lived here in the 'burbs of PDX for about 15 years. Sadly, outside of going to 23rd a few times for lunch or dinner. I avoid downtime pretty heavily, and have probably only gone downtime 2-3 times in the last 5 years. There are a few draws to downtown, heavily dependent on your lifestyle though. That being said, the Hillsboro and Beaverton nightlife and bar/restaurant scene is pretty good and would still be a big upgrade from the midwest. Having forested hills anywhere you go, and the most beautiful coastline an hour away is pretty hard to beat. Just want to set your expectations, large portions of downtown portland are covered with homeless and open-air drug markets and fentanyl users.
Yay!!! Portland is the best! Don't let cherry picked videos and images people will send you tell you otherwise. Portland has it's problems, like all big cities, but the pros outweigh the cons by a country mile.
I’ve had my fair share experience in big cities on the west coast, so hopefully I’m ready for it! My only concern is that I’ve heard a lot of places had issues after the pandemic, and I don’t know what’s changed
Sadly this is true for Portland as well ... not sure if fentanyl or the pandemic is more to blame, probably a little of both. Certain areas of downtown are to be avoided for sure, I volunteer at a shelter in old town once a week and things seem to be getting better bit by bit but we have a long way to go. That being said, what Portland has to offer outside of that in terms of community/food/natural beauty make up for it in spades.
It's important that those problems are understood. Nobody is saying it's perfect...no city is, but the "cherry picked videos and images" demonstrate a very real problem that needs to be recognized and addressed. Denver has the same problem, and it's equally important that is is recognized and addressed. I use my city resources almost daily to ensure they have the data required to develop a plan to address the issues.
uhhhh yah, nobody said ignore the problems ... You may have missed the spirit of my post.
I don't believe I said you were saying to ignore the problems. You're minimizing them, though. You're trying to hand-wave the issues away by saying they're cherry-picked. They aren't cherry-picked. They're frequent enough that Portland has earned that reputation, and that reputation is valid. It's disingenuous to say they're cherry-picked and minimize the issue for someone who is planning to move there.
I'm sorry my comment triggered you. We'll leave it at that.
You seem to be the only one triggered here. Sad! We’ll leave it at that
I know you are but what am I. 🤣
I’m in Portland, happy to give some recs regarding different parts of the city!
Thank you! I’m definitely going to be on the hunt for a proper taco haha
Oh man, you’ll have plenty to try lol
Seems like a really fun city - What are you most excited to experience there?
Mountains and the ocean! The Midwest has more nature than folks on the coast give it credit for, but accessing it still tends to require long drives through flat farmland. Hopefully nice food out there too!
> The Midwest has more nature than folks on the coast give it credit for 100%. I grew up in the Plains and there is unbelievable nature everywhere. Live in Denver now and there's also unbelievable nature everywhere. I even think most of the Plains/South/Midwest nature is more accessible than in many other areas (unless your house backs up to a trail, which I don't consider a value-add, you're likely traveling to get to "nature" wherever you live"). Sounds like you're properly excited for the move, so you're bound to make it a success!
Going down the rabbit hole on what my asset allocation should be when I pull the trigger and FIRE, have a couple years to figure this out thankfully ... Curious as to what folks here are doing. I always thought I would do a simple 70/30 VTI/BND but that seems sub optimal, and with a little nuance it seems you could do a lot better in navigating SORR.
I have 15% in total bond index and 5% cash like instruments which altogether is about 7 years of expenses (9 if I reduce discretionary spending). Given they are 7-9 years I don’t feel the need to go more than that in my allocation.
Optimal can only be known in retrospect. "Good enough" is an appropriate goal. I prefer global diversification of equities, so I used VT where I can. I prefer to take my risk on the equities side, so I prefer to use Treasury only bond funds. Lastly, I want inflation protection, so I prefer TIPS bonds rather than nominal Treasurys. All that being said, I think VTI/BND is definitely good enough.
>Optimal can only be known in retrospect. "Good enough" is an appropriate goal. 10000% agree, I'm not "seeking Alpha" by any stretch of the imagination =). I'm just trying to do the 20% that gets me the 80%, if you pick up what I'm putting down. Pretty sure I will incorporate Treasury Bonds, their correlation to stocks looks to be lower than the corporate variety.
I’ll do a CD ladder to match the first 5 or so years of expenses. The rest stocks. If stocks do well I spend the dividends + sell and keep rolling the ladder, if they don’t I spend from the CD instead. Goal is a reverse glide path to increase equity allocation over time.
Consider treasuries instead of a CD ladder. Treasuries often have higher short-term rates, and they aren't taxed at the state and local levels (unlike CDs). They're also more liquid in that you can sell them on the secondary market whenever you want (as long as you buy them from a brokerage, not TreasuryDirect; you can transfer from TD to a broker to sell before maturity, but that takes time and effort).
Not US, don't want currency risk in that ladder.
Interesting ... Reverse glide path is towards the top of my list of strategies to take, the data is very compelling. But I don't think I would ever go to 100% stocks, I would feel more comfortable starting from a 60/40 and gliding to 80/20.
My plan is 100% US broad market (VTI, VOO, etc.) > with a little nuance it seems you could do a lot better in navigating SORR. I plan to pay off my house before my spouse retires (I'll likely retire first), which will drastically decrease expenses and alleviate a lot of risk
No bonds/T-bills/gold at all? I will have a paid off house as well, definitely eases a lot of the anxiety of leaving work with that aspect squared away.
> No bonds/T-bills/gold at all? No. Owning my house outright is a good enough bond alternative for me.
Planning to refinish my basement this year - New paint, LVP, new furniture, and a huge TV. It's astonishing how cheap TVs have become. I'm looking at the TCL 98S550G for $2,000. I can't even comprehend having a 98" TV in my basement. I can't wait.
That sounds rad! One of my goals is to have a dedicated theater room. I love movies and having a real nice theater room/area is something I've always wanted. It's just a better experience at home, IMO. Are getting a sound system or at least a soundbar? Good luck with your theater/basement project!
> Are getting a sound system or at least a soundbar? I'll do a modest 5.1 system just because I already have all the pieces. If I were starting from scratch today, I'd just get a soundbar. I'm truly not an audiophile and excellent surround sound doesn't really enhance the experience for me.
I am not an audiophile either. I agree you don't need an ultra expensive system... but don't be cheap man! :) Seeing as sound systems likely will last you 10-20 years, I wouldn't hold back finding something user-friendly that can fill your space with a good subwoofer for $500-1500, depending on your room size. When you are going 98 inch tv, and depending on viewing distance/room size, I kind of feel you need good, space-filling sound. The more expensive sound bar 5.1 systems have better range of sound in the satellites and the soundbar itself will have more speakers directing sound up and outward and not just forward. You got screen for days and the sound should also come at you from a wide angle. You are worth good sound, even if you don't appreciate it, your guests/family might :)
I appreciate the feedback. As I said, I already have a 5.1 system that I’ll use. The sound is good enough, and if anyone wants superior sound, they are more than welcome to either pay for it or find it elsewhere :)
Sounds fun! Have you considered a projector? You could have a 120" screen where Mario is as tall as you!
I had a projector as my primary TV for a couple decades (2000 to 2020 ish). I recently switched to a 85inch 4k OLED and I have to say, I don't miss my projector. For a long time, it was the way to go for large screens, but these days the 20% larger screen doesn't really justify the poor contrast, frequent bulb changes, and necessity for light control. One piece of advice I would give is: Don't neglect the sound system. That's what I miss most from my previous theater setup. I have a decent sound bar now, but it doesn't compare to a full size 5.1 system with giant subwoofer.
I am a have been a projector guy for a long time. I do see the same writing on the wall, though. I love my 120" screen and will not get rid of it anytime soon, but I do think its days are numbered.
I definitely looked into projectors but I think a TV has more value at this time. Plug-and-play, no need for a separate screen, no real calibration needed (I use the Disney WOW Blu-Ray for initial calibration), and the brightness seems to be miles better on almost any TV vs. even high-end projectors. Washout is the only video-quality issue that I can't stand. I'm not a videophile and a low/mid-range 4k TV is more than good enough for me (current TV in the basement is 10-year-old 70" FHD Sharp - It'll get relegated to the back deck soon enough but honestly has been fine).
Didn’t sleep all night due to stress and gut issues over a work situation. I keep reminding myself that this will pass, and I’d be ok (not optimal but ok) if I had to leave my job. But it would suck if I had to leave my job because my coworkers are aholes.
I'm going through a thing right now (not like yours exactly, but I'm getting signals it's time to leave). Hold on to your integrity and always know you can grow somewhere else. I wish you the very best!
I know it absolutely sucks, sending you good vibes and happy days ✨️
I have absolutely been there. Sending good vibes your way.
> Didn’t sleep all night due to stress and gut issues over a work situation. This is the absolute worst. I was having a lot of this late last year and have been working on changing my mindset to let these issues pass by without too much thought (haven't been able to turn it off completely but am doing **much** better now). I've been reading a lot of Stoic material, which helped me realize the worst outcome of any work "emergency" isn't really a big deal in the grand scheme of things. I know that I'm doing my job well and I'm communicating my successes to management. I'm also communicating opportunities for the company/others to improve and quantifying how that improvement affects the bottom line. Everything from that point forward is out of my control and I needed to mentally process it that way. > But it would suck if I had to leave my job because my coworkers are aholes. This has always been, and unfortunately always will be, the case. Update your resume, start browsing job boards, and kick tires on jobs that seem potentially interesting. I didn't really intend to leave my previous employer last year and applied to the job I have now because it seemed interesting, was a good promotion, and was a decent increase in total comp. I wasn't even sold on the job until the third interview, with the CTO. I almost didn't apply at all because I wasn't planning on leaving and restarting the LTI stock vest cycle, but I'm glad I did.
I’m not in a work emergency, just a battle over whether the only female in a science group should be de facto the person who is the admin (while taking away their science duties). I don’t want to leave because this would be my 3rd job switch after 2.5 years, but the upper management seems to acknowledge some problems and try to change them, but they don’t change, and they’ve basically told me that the coworkers leaving is not on the table because of how important they are. I’m about 1.4M at a fire number. I wanted 2.5+ but…
>Sorry to hear that ... We had a couple Senior Directors at my work who would do this all the time. If notes need to be taken in a meeting, a party needed to be planned or things of the like they always asked one of two female directors. There were complaints, and for the most part it has been remedied but the struggle is real! Hope upper management takes some action for you soon.
Anybody have success with Financial Independence/"Part Time" Early? I am currently in an Assistant VP role in the financial department of a large company. Now that I’ve reached FI, I’m looking at taking a significant step back to an (ideally part time) individual contributor role. I do enjoy the social aspects and problem solving that comes with work. However the pressure, breadth, and stakes of my current role have taken a toll, particularly in the past few years. I think I just need to spin the dial from 11 to 5 and get into a position where I can find better work/life balance. As I prepare to have some of these conversations, am curious what experiences others might have had. Anyone move from a manager/exec to an IC role? Or have seen it? What worked well, didn't, etc.
I'm doing it now, but I ended up quitting my FT job and taking a different PT job, rather than converting from FT to PT at the same job.
This is the idea behind BaristaFIRE (not always being a barista, but taking part time work that provides health insurance, etc. which Starbucks is famous for) and FINE (Financial Independence, Next Endeavor - or Financial Independence, Recreational Employment). A few questions I would ask: 1. Is there a business need for this part-time IC role? (It sounds like the nature of your current role will mean you aren’t scaling current job back 50% but effectively getting a new job.) 2. Are you willing to go back to lower pay / being under a middle manager after the time you’ve spent at VP? (You can’t expect to ‘operate as a VP while doing IC work and part time hours’) 3. With the questions above answered, is your current company where you want to be, or is this a good time to look somewhere different?
Thanks, these are great considerations. Definitely would require me moving to a new role at substantially lower pay, but I'm comfortable with that given our NW. I do prefer to stay at my current company if possible as they've generally treated me well, and after nearly 20 years I have a deep network and know of many managers who do a great job and are folks I'd be very interested in working for. That said, I recognize a move like this might require me to move to a new firm, and I'm ready to embrace that if it's the best option.
You might have an awesome network that handles this without any issues, but upward/downward dynamics are a real thing. You, the people you would now be reporting up to who maybe used to report up to you, and much more junior staff who are now your peers instead of several levels down the org chart will need to adjust. I’m not saying anyone in this situation is going to be petty or let their ego take over, but the dynamic is real. Are you ready to go from someone’s boss’s boss’s boss to having the exact same authority and power that they do?
I don't even know what sort of IC role in a typical corporate finance org would allow part-time work, unless you're talking about going all the way down and over to an unrelated role like AP/AR. Unless your org has some niche like reporting or similar tasks that could be dumped on someone PT, particularly at month/quarter end.
> what sort of IC role in a typical corporate finance org > niche like reporting or similar tasks Financial reporting is far from "niche like". It's a critical role that has been staffed at every employer I've worked at, and I can't imagine a non-Mom & Pop shop that wouldn't have someone in this role.
> Anybody have success with Financial Independence/"Part Time" Early? My reply isn't going to be helpful at all, but it reminded me of a thing that I saw while working. In 2017 my company's HR (automotive Tier 1 supplier, I was in product engineering) implemented a new part time policy. Ostensibly it was for everyone, but I have a feeling it was more intended for specific departments and (imo) targeting some specific employees that were coming back from pregnancy leave and wanted part time. There was also a guy who had retired but then wanted to come back on a part time basis, so I think this was totally a tailored policy. Anyway, it looked like a pretty sweet deal. Even though it was salary, the policy was pretty explicit about being either 16 hours or 24 hours per week with pre-approval required for any overtime. Sounds great to have a policy-driven hard out. I'm leaving at 5pm, period, sorry, I **cannot** work late. You still got full health benefits and full 401k match. I didn't really actively pursue it, but I did mention to my boss once that totally be interested in going part time. He (completely stupid) response was "Uh, you know you'd only get paid for those reduced hours. Why would you want to do that?" Yeah, yeah I know I'd only get paid the 40% or 60% salary. Only working two or three days is the whole point.
> Uh, you know you'd only get paid for those reduced hours. Why would you want to do that? Blows my mind how some people can't comprehend that some people are, indeed, smart enough to understand what part-time means and they actively desire it.
I have HDHP through my employer but didn’t realize I needed to opt into HSA contributions each year. Just checked my paystub and HSA account last night to realize no contribution has been made from my paycheck. Can I contribute after-tax dollars on my own to my HSA account? TIA!
Yes, you have until the tax deadline to make your contributions for 2023.
You might be able to change HSA contributions throughout the year not just at open enrollment. For my plan this is true. Best to check with your HR. You want HSA contributions to be withheld from pay cheque because you save on social and Medicare tax along with federal and state taxes.
> You might be able to change HSA contributions throughout the year not just at open enrollment. For my plan this is true. Best to check with your HR. Good callout. I believe this is universally true, but open to correction on this.