An Investment Thread

[Nater Potater]

Reminds me of when I first dipped my toes into the stock market. I was clueless, to be honest. But then a friend introduced me to prop trading firms like Black Eagle FG..

Me and my big mouth. I had to be the one giving crap to the bots about either no or bogus boat/engine info, and they took that and ran with it. Let's try this: "Hey bots. If you want us to believe you're real, post something noteworthy in the bikini thread."

 

[Stray Current]

Me am not smart with money, me hide money under rock…

Following and going to go back and read

 

[ttmott]

Here is another thought - If you have a qualified retirement plan (IRA for example) and it is under your management, consider this -
When you turn 73 you will have to take required minimum distributions (RMD). Those distributions are based upon a factor from the tax tables; essentially years in life expectancy. The RMD is taxable income. That income also determines your taxable percentage of your Social Security and Medicare IRMAA (the added monthly contribution to Medicare based upon reported income two years prior).

So let's say you have $500K in an IRA and are turning 73 - your RMD will be around $25K which will likely move you into a higher tax bracket as well as raise the taxable amount of your SS and raise your IRMAA two years down the road. A bad situation.

On top of all this our national tax obligation will not go down in the future - things look to be getting worse for those that saved pre-tax.

So, consider converting a portion of your IRA to a post-tax ROTH and pay the taxes now on the conversion. You'll pay the tax any way you look at it and, no doubt, more tax later. Consider where you are in your tax bracket and convert at least to the top of that bracket or even the next. Remember a ROTH is exempt from capital gains tax.

There are no limits (depending upon age) on how much you convert to a post-tax ROTH and it can be converted "in kind". In Kind means you can move Vanguard Index over to the ROTH for example.

I'll be 70 this year and for the next three years I'm chunking large amounts to a ROTH in order to limit exposure at 73 and later.

 

[highslice]

Here is another thought - If you have a qualified retirement plan (IRA for example) and it is under your management, consider this -
When you turn 73 you will have to take required minimum distributions (RMD). Those distributions are based upon a factor from the tax tables; essentially years in life expectancy. The RMD is taxable income. That income also determines your taxable percentage of your Social Security and Medicare IRMAA (the added monthly contribution to Medicare).

So let's say you have $500K in an IRA and are turning 73 - your RMD will be around $25K which will likely move you into a higher tax bracket as well as raise the taxable amount of your SS and raise your IRMAA two years down the road. A bad situation.

On top of all this our national tax obligation will not go down in the future - things look to be getting worse for those that saved.

So, consider converting a portion of your IRA to a post-tax ROTH and pay the taxes now on the conversion. You'll pay the tax any way you look at it and, no doubt, more tax later). Consider where you are in your tax bracket and convert at least to the top of that bracket or even the next. Remember a ROTH is exempt from capital gains tax.

There are no limits (depending upon age) on how much you convert to a post-tax ROTH and it can be converted "in kind". In Kind means you can move Vanguard Index over to the ROTH for example.

I'll be 70 this year and for the next three years I'm chunking large amounts to a ROTH in order to limit exposure at 73 and later.

This was a real eye opener for me managing my Mom's finances after my Dad died in 2009. He left my Mom a substantial IRA, more than she could spend in a lifetime at that point in her life. Unfortunately my siblings got to the statements before I did so they knew exactly how much was there. As time went on and they lost jobs but didn't want to sacrifice their standards of living they would go to the bank of Mom. She couldn't say no and would go into hysterics if I did. There were years when they would each hit her up for 6 figures and between state and federal she was paying 40%+ taxes on those funds. I put my foot down and ended that crap. She predictably went into hysterics again, but I threatened to quit as trustee and have one of my siblings take over. That ended that. But the damage was done. Long story short, I shouldn't have been, but I was shocked at the tax bill. My wife and I are in the process of converting to Roth.

 

[M & L]

Here is another thought - If you have a qualified retirement plan (IRA for example) and it is under your management, consider this -
When you turn 73 you will have to take required minimum distributions (RMD). Those distributions are based upon a factor from the tax tables; essentially years in life expectancy. The RMD is taxable income. That income also determines your taxable percentage of your Social Security and Medicare IRMAA (the added monthly contribution to Medicare based upon reported income two years prior).

So let's say you have $500K in an IRA and are turning 73 - your RMD will be around $25K which will likely move you into a higher tax bracket as well as raise the taxable amount of your SS and raise your IRMAA two years down the road. A bad situation.

On top of all this our national tax obligation will not go down in the future - things look to be getting worse for those that saved pre-tax.

So, consider converting a portion of your IRA to a post-tax ROTH and pay the taxes now on the conversion. You'll pay the tax any way you look at it and, no doubt, more tax later. Consider where you are in your tax bracket and convert at least to the top of that bracket or even the next. Remember a ROTH is exempt from capital gains tax.

There are no limits (depending upon age) on how much you convert to a post-tax ROTH and it can be converted "in kind". In Kind means you can move Vanguard Index over to the ROTH for example.

I'll be 70 this year and for the next three years I'm chunking large amounts to a ROTH in order to limit exposure at 73 and later.

My accountant is not a fan of me converting to Roth. He hates taxes. He says to me, I would definitely be paying taxes when converting, not avoiding them and the future might hold a way to avoid them altogether. For example I could donate to charities near and dear to my heart.

Anyway, just another way to look at the problem.

 

[Gofirstclass]

I converted my 401K into an IRA then immediately converted it to a Roth IRA during the Bush Tax Reconciliation and Recovery Act period. That act allowed me to split the tax liability between two years.

That was years ago and well before NVIDIA, SMCH, MU and other rapid gainers. Now, if I need to take any money out it's not taxed. I also moved my entire Roth to E*Trade so any buy/sell moves I make are done without commissions.

Those were by far the best investment moves I ever made.

Thank you George W Bush.

 

[Flyer5]

Just bought some DJT stock. We will see how it goes.

 

[highslice]

My accountant is not a fan of me converting to Roth. He hates taxes. He says to me, I would definitely be paying taxes when converting, not avoiding them and the future might hold a way to avoid them altogether. For example I could donate to charities near and dear to my heart.

Anyway, just another way to look at the problem.

You have a very conservative and hopeful accountant, not that there is anything wrong with that. I have been reluctant to convert in the past, but my investment advisor is doing a cost/benefit analysis for me, so we'll see. Best of luck.

 

[M & L]

You have a very conservative and hopeful accountant, not that there is anything wrong with that. I have been reluctant to convert in the past, but my investment advisor is doing a cost/benefit analysis for me, so we'll see. Best of luck.

I'm completely parroting, my accountant and he feels taxes are always being cut. I believe the last 3 administrations, O,T, and B have cut taxes as he predicted.

The other truism he believes, paying with cheaper dollars. Just like a 1031 exchange, kicking the tax can down the road also means paying with devalued currency. So far he is correct. Although, I'm envious of Gofirstclass being able to time his tax jump into a pretty sweet deal.

 

[Creekwood]

Don’t make this political. It’s not. Anyone else thinking about shorting DJT? It’s way overvalued and it seems like the major push is from retail investors buying on emotion since the valuation would require insane growth such that the majority of the world (not just the US) would move to their platforms. I think that’s impossible or near zero probability. So once the initial flurry subsides I think when the price starts to drop, there will be a huge drop as a result of those small investors bailing out.

I’ll decide on Thursday once another couple days are past.

 

[Golfman25]

Don’t make this political. It’s not. Anyone else thinking about shorting DJT? It’s way overvalued and it seems like the major push is from retail investors buying on emotion since the valuation would require insane growth such that the majority of the world (not just the US) would move to their platforms. I think that’s impossible or near zero probability. So once the initial flurry subsides I think when the price starts to drop, there will be a huge drop as a result of those small investors bailing out.

I’ll decide on Thursday once another couple days are past.

Yeah. Go ahead. Probably not the wisest move. This thing will move based on politics. You could get your butt handed to you. Maybe do a put or something where your risk Will be limited.

 

[ttmott]

I'm completely parroting, my accountant and he feels taxes are always being cut. I believe the last 3 administrations, O,T, and B have cut taxes as he predicted.

The other truism he believes, paying with cheaper dollars. Just like a 1031 exchange, kicking the tax can down the road also means paying with devalued currency. So far he is correct. Although, I'm envious of Gofirstclass being able to time his tax jump into a pretty sweet deal.

The cost of money now is cheaper than money later - always.
There is a lot of angst in the current administration to get into investments (unrealized capital gains) and savings to fund the un-fundable. The last several administrations and congress' have grossly overspent with the current exceeding all. I don't see an end to the quest to obtain tax revenue regardless how sacred. I even see the possibility the Gov will terminate ROTH investments at some point.

Everyone's investment portfolio and income strategy are different and unique. I expressed a strategy that will reduce tax risk in the future for me and laid out the rationale. Your comments don't seem to make much sense for future value and risk in my opinion especially if you have a reasonably sizeable portfolio with significant pretax holdings.

Additionally, if I lived in NY, CA, Il, or other wacky doodle states, I'd be very spooked on how they plan to fund and recover their deficits and plans.

 

[Creekwood]

Yeah. Go ahead. Probably not the wisest move. This thing will move based on politics. You could get your butt handed to you. Maybe do a put or something where your risk Will be limited.

This would be a higher risk / reward investment. I’m not looking for a blue chip value play. I have enough of that already. I do think it will run up for a while and then it will cap out and then crash to what its business fundamentals will support. Which is well below where it is now.

 

[Jaybeaux]

This would be a higher risk / reward investment. I’m not looking for a blue chip value play. I have enough of that already. I do think it will run up for a while and then it will cap out and then crash to what its business fundamentals will support. Which is well below where it is now.

Without getting political.....what high flying IPO isn't lower 6+months down the road? Especially when the insider's lock-up period ends?

 

[Golfman25]

This would be a higher risk / reward investment. I’m not looking for a blue chip value play. I have enough of that already. I do think it will run up for a while and then it will cap out and then crash to what its business fundamentals will support. Which is well below where it is now.

Sure, everything can crash at some point. But, it can go up longer than you can stay solvent. Go for it.

 

[M & L]

The cost of money now is cheaper than money later - always.
There is a lot of angst in the current administration to get into investments (unrealized capital gains) and savings to fund the un-fundable. The last several administrations and congress' have grossly overspent with the current exceeding all. I don't see an end to the quest to obtain tax revenue regardless how sacred. I even see the possibility the Gov will terminate ROTH investments at some point.

Everyone's investment portfolio and income strategy are different and unique. I expressed a strategy that will reduce tax risk in the future for me and laid out the rationale. Your comments don't seem to make much sense for future value and risk in my opinion especially if you have a reasonably sizeable portfolio with significant pretax holdings.

Additionally, if I lived in NY, CA, Il, or other wacky doodle states, I'd be very spooked on how they plan to fund and recover their deficits and plans.

I don't understand what you are trying to say, "The cost of money now is cheaper than money later - always."

As to Roth, IRA and 401k's there has been some recent analysis that says the programs are inefficient. The analysis showed that wage earners had a low adoption rate. Most of the people utilizing the programs had enough income to build a retirement fund without needing the tax break. I have no idea if this will change the programs or not.

I don't believe there is an end to overspending as, we the people, have a lot of wants and no interest in paying for them. It is easy to blame congress but who are the people clamoring for more spending.

 

[Creekwood]

Sure, everything can crash at some point. But, it can go up longer than you can stay solvent. Go for it.

Damn it. I missed the window. Didn’t think it would drop so fast. Gotta trust my instinct more.

 

[Golfman25]

Damn it. I missed the window. Didn’t think it would drop so fast. Gotta trust my instinct more.

It’s the highest shot held stock in the market. Ripe for a gamestop short squeeze. In any event it’s manipulated due to Trump.