#256
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2003 CSi / Legend Ti / Seven 622 SLX |
#257
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huzzah! |
#258
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Congrats....you're better off than ~90% of the folks out there. Didn't mean to sound preachy on my post....just forgot the "smiley face".. Cheers.
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2003 CSi / Legend Ti / Seven 622 SLX |
#259
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#260
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also happy to learn from others' strategies and see what has worked for you/them. |
#261
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Assume income of 105k after FICA taxes (doing this b/c it removes effect of going to lower marginal rate), analyze the following: -maxing 401(k) to 18.5k means tax saving of 4.44k, which is $1060 short of maximal annual Roth contribution. In effect, $18.5k of pre-tax money gives you: $18.5k of 401(k) and $4.44k to Roth IRA. In total, $18,500 of pre-tax gives you $18,500 of 401(k) and $4,440 of Roth IRA. -maxing Roth IRA of 5.5k from $18,500 pre-tax money, whatever left going to 401(k). If my math is correct, you can do this by contributing $16,473 to 401(k) and the remaining $2,027 to Roth. That $2,027 becomes $1540 after tax, while the tax benefit of $16,473 is $3953, for total of ~$5,500. However, compare the following, -In the first case, you have $18,500 in 401(k) and $4,440 in Roth; in the second case, $16473 and $5,500. The first case has $2027 more in pre-tax money and $1060 less in post-tax. Except, $2027 pre-tax is worth more than $1060 post-tax at the 24% rate, as the former is worth $1540. That said, you are right that Roth offers greater flexibility, as not only are you allowed $11k in gains for home purchase, you are also allowed to take out your contributions without penalty after five years. Last edited by echappist; 10-25-2018 at 02:37 PM. |
#262
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Besides IRAs and 401k accounts, an important savings vehicle that may be overlooked is the Health Savings Account if you're in a high-deductible health insurance plan.
This has triple tax savings: pre-tax contributions, tax free earnings and tax-free withdrawals (for qualified medical/health expenses). I contribute the maximum and plan to use it as a long-term care/medicare gap policy when I'm retired. One of the analyses that we're revising is the sustainability of the US government with regards to social security, Medicare, pensions and student debt (this could be a large write-off if folks can't repay). The govt safety net is very thin and should not be counted on to fund your future needs. It is uncertain how the govt will handle Social Security and Medicare when the trust funds are depleted (2033 and 2026, respectively and assuming no recession in the mean time). Either benefits need to be trimmed and/or taxes will need to increase.
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My Bikes Last edited by veloduffer; 10-25-2018 at 02:52 PM. |
#263
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It is ridiculous (but not surprising) Social Security has not been dealt with already....it is just a simple math problem. It get complicated only because of the huge (voting) population who receiving or soon to receive it. Raise taxes (rate or tax all wages) Raise full benefits age - just give affected group 20+ yrs to plan Reduce payments - again, give affected group time to plan Allow individuals to "opt out" - a la Warren Buffet just sayin'
__________________
2003 CSi / Legend Ti / Seven 622 SLX |
#264
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Alot of good stuff above. Basically,
Reduce taxable income with 401k/etc, fund ROTH vehicles, fund HSA if you can, and get a high yield checking account or cash back credit card if you can afford to pay it off monthly. Pretty much live within your means, but also remember to live life. You can't spend your whole life saving and scraping by, do what makes you happy along the way. You don't want to be 80 and rich and never have any fun. Enjoy it along the way. |
#265
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Amazon up almost 118 during the regular session and giving it all away after hours.
Jeff |
#266
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What a roller coaster. Amazing that profitability takes a backseat to revenue.
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#267
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Alas the world in which we live.
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#268
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Jeff |
#269
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it's kinda laughable.
the headlines say earning disappoint, shares tanking. everything is still up staggering % and $'s in absolute terms. but when it's trading at such a frothy multiple, it doesn't take much to push momentum downward. their "disappointing" earnings growth rate is still the envy of many a corporation. |
#270
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It does seem that earnings reports in the last two months, if they are not absolutely stellar, result in over reactions from investors, especially in retail. True, or business as usual? |
Tags |
economy, freemoneyhouse, stonks, vertdoug for fed chair, wealth, yen carry trade |
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