On 5/11/2021 7:45 PM, DerbyDad03 wrote:
On Tuesday, May 11, 2021 at 7:54:31 PM UTC-4, dpb wrote:
On 5/11/2021 5:39 PM, Leon wrote:
...
I learned a few days ago that RMD can be rolled over in to a ROTH IRA
with no RMD from those IRA's
Not exactly "rolled over"; you can convert, but it's not painless by any
stretch for most.

I've converted some, but it ain't a no-brainer it's agonna' be a win in
any short time.

You pay tax on it first at ordinary marginal income rates unless you
have post-tax contributions inside the ordinary IRA.

Plus, RMDs are not eligible to be rolled over and you must take the RMD,
anyway. Thus, whatever you convert will first be ordinary income above
and beyond that of the RMD for the year. And, that extra can be enough
extra to kick in the AMT bite to make the pain even more.

If you can stand that immediate pain, then remember that a distribution
from a Roth is tax- and penalty-free after a five-year aging period.

Sort of...distribution of funds from contributions/conversions is allowed at
any time. It's the *growth* that can't be withdrawn tax/penalty free prior
to 59 1/2 or before 5 years, whichever is longer. There are also exceptions
to that rule. IRS Publication 590-B can be a fun read. ;-)


Medial costs can offset distribution taxes. My dad was in a memory care
canter for about 4 years. I was able to liquidate his IRA's enough to
offset the medical cost and not pay additional taxes.

This may have or might disappear.





If you're of an age that you debate buying green bananas, ...

I shoulda' done starting 30 years ago; now it's pretty painful first
bite to undergo.

--

On 5/11/2021 7:18 PM, DerbyDad03 wrote:
On Tuesday, May 11, 2021 at 6:39:29 PM UTC-4, Leon wrote:
On 5/11/2021 4:01 PM, dpb wrote:
On 5/11/2021 3:54 PM, dpb wrote:
On 5/11/2021 2:18 PM, Scott Lurndal wrote:
dpb writes:

My overall mix is closer to 60:40 when I categorize my dividend-paying
stocks portfolio as "fixed income" which purpose it serves at present
despite being equities. Being long-time continuous-dividend-paying
stocks, as a group they don't appreciate at the same rate as those held
solely/mostly for growth

Although if you enroll them in a DRIP, they do compound over time...

They are...and have at an annualized rate of about 7-8%.

OTOH, a portfolio concentrating on growth stocks may have doubled that
over the same time frame (with much higher volatility, too).

These are not serving that purpose, however, however tempting it is to
always go for the gains!

I have considered letting the dividends go to cash for the income stream
to satisfy the RMD, yes, but there are other places/ways in the overall
portfolio to do that, so, so far, I've just let them grow in situ in
order to keep roughly same balance.

Since they haven't done quite as well as the overall portfolio, they
have slipped some in the overall mix percentage; I did buy into one here
in the recent downturn to boost the overall up a little and also was a
real opportunity to raise the effective dividend rate by bringing down
the average cost/share a little.

--
I learned a few days ago that RMD can be rolled over in to a ROTH IRA
with no RMD from those IRA's

Another option...

If you donate to charities, you may be able to do the donations directly
from your IRA and not pay any taxes on the RMD. They are called Qualified
Charitable Donations. You just can't take possession of the funds. You
have to have them sent directly to the charity(s).

Plus side: Even though the RMD age has been raised to 72, they still
allow QCD's starting at age 70-1/2. They would have screwed a lot of
charities out of donations if they didn't make that exception.

So, all you "kids" out there...donate!



But 100% of that donation is gone...vs. only the taxable amount of a non
donation.

But if making donations anyway that would be helpful. I donate my time,
and a lot of it.

On 5/12/2021 9:05 AM, Scott Lurndal wrote:
Leon [email protected] writes:
On 5/11/2021 4:01 PM, dpb wrote:
On 5/11/2021 3:54 PM, dpb wrote:
On 5/11/2021 2:18 PM, Scott Lurndal wrote:
dpb writes:

My overall mix is closer to 60:40 when I categorize my dividend-paying
stocks portfolio as "fixed income" which purpose it serves at present
despite being equities.Â* Being long-time continuous-dividend-paying
stocks, as a group they don't appreciate at the same rate as those held
solely/mostly for growth

Although if you enroll them in a DRIP, they do compound over time...

They are...and have at an annualized rate of about 7-8%.

OTOH, a portfolio concentrating on growth stocks may have doubled that
over the same time frame (with much higher volatility, too).

These are not serving that purpose, however, however tempting it is to
always go for the gains!

I have considered letting the dividends go to cash for the income stream
to satisfy the RMD, yes, but there are other places/ways in the overall
portfolio to do that, so, so far, I've just let them grow in situ in
order to keep roughly same balance.

Since they haven't done quite as well as the overall portfolio, they
have slipped some in the overall mix percentage; I did buy into one here
in the recent downturn to boost the overall up a little and also was a
real opportunity to raise the effective dividend rate by bringing down
the average cost/share a little.

--

I learned a few days ago that RMD can be rolled over in to a ROTH IRA
with no RMD from those IRA's

Yes, at a cost. You pay the taxes on the rollover. The ROTH grows
tax free from that point forward, but you still need to pay the taxes
deferred by the 401k/IRA.



Yes, I left that out. I was just was not clear if you could reinvest
in a ROTH IRA after the 70.5 age.

On Wednesday, May 12, 2021 at 11:17:10 AM UTC-4, Leon wrote:
On 5/12/2021 9:05 AM, Scott Lurndal wrote:
Leon [email protected] writes:
On 5/11/2021 4:01 PM, dpb wrote:
On 5/11/2021 3:54 PM, dpb wrote:
On 5/11/2021 2:18 PM, Scott Lurndal wrote:
dpb writes:

My overall mix is closer to 60:40 when I categorize my dividend-paying
stocks portfolio as "fixed income" which purpose it serves at present
despite being equities. Being long-time continuous-dividend-paying
stocks, as a group they don't appreciate at the same rate as those held
solely/mostly for growth

Although if you enroll them in a DRIP, they do compound over time...

They are...and have at an annualized rate of about 7-8%.

OTOH, a portfolio concentrating on growth stocks may have doubled that
over the same time frame (with much higher volatility, too).

These are not serving that purpose, however, however tempting it is to
always go for the gains!

I have considered letting the dividends go to cash for the income stream
to satisfy the RMD, yes, but there are other places/ways in the overall
portfolio to do that, so, so far, I've just let them grow in situ in
order to keep roughly same balance.

Since they haven't done quite as well as the overall portfolio, they
have slipped some in the overall mix percentage; I did buy into one here
in the recent downturn to boost the overall up a little and also was a
real opportunity to raise the effective dividend rate by bringing down
the average cost/share a little.

--

I learned a few days ago that RMD can be rolled over in to a ROTH IRA
with no RMD from those IRA's

Yes, at a cost. You pay the taxes on the rollover. The ROTH grows
tax free from that point forward, but you still need to pay the taxes
deferred by the 401k/IRA.

Yes, I left that out. I was just was not clear if you could reinvest
in a ROTH IRA after the 70.5 age.

You can if you have earned income.

On 5/12/2021 10:06 AM, Leon wrote:
On 5/11/2021 6:54 PM, dpb wrote:
On 5/11/2021 5:39 PM, Leon wrote:
...

I learned a few days ago that RMD can be rolled over in to a ROTH IRA
with no RMD from those IRA's

Not exactly "rolled over"; you can convert, but it's not painless by
any stretch for most.

Yes, distributed, taxed, and then moved into a ROTH IRA.

And distributed ABOVE THE RMD, IF ANY is a big 'un cuz the RMD isn't
eligible and you have to take it anyways.

AND IIRC there is a limit that can be reinvested in the ROTH each year.
$7K?

That's on new contributions that have to come from current earned
income; you can convert as much as you have stomach to pay the taxes on
to do so.

....


If you're of an age that you debate buying green bananas, ...

I shoulda' done starting 30 years ago; now it's pretty painful first
bite to undergo.

--

I first IRA's were in the 80's, first ROTH, 2009 IIRC.

Hyperbole, you get the drift/intent.

On Wednesday, May 12, 2021 at 9:28:37 AM UTC-4, Leon wrote:
On 5/11/2021 10:35 PM, DerbyDad03 wrote:
On Tuesday, May 11, 2021 at 4:59:51 PM UTC-4, Leon wrote:
On 5/11/2021 1:20 PM, dpb wrote:
On 5/11/2021 9:29 AM, Leon wrote:
On 5/10/2021 3:07 PM, dpb wrote:
Snip

When conditions change (as they will, eventually) to a more historical
pattern, I'll adjust the mix to match; meanwhile I see no reason not to
ride the rocket as long as can...

Do have to pay attention and be willing to "pull the plug!" when it's
time this way, though, granted, and not leave it all up to somebody else.

I certainly take broker's advice/recommendations into account, but don't
wait around for him to tell me it's time to move--he has a ticker that
gives him flags, but he's also got a bunch of other clients (as all do)
so can't rely on being the first on the call list.

--

Exactly, I have had more than one conversation with moth of my money
managers concerning the OBVIOUS.

It there is bad news on the networks. The long time awaited tech stocks
crash leading up to the first quarter in 2000. and then The Corona virus
at the first of last year.

Their answer is, it will come back. My response, why in the world ride
it to the bottom? Get back in "near the bottom. Get out until the the
stocks come back up. And I am not talking about knee jerk market
reactions.

Yes it is hard to tell when the recovery starts but some thing are obvious.

Have you ever verified that you made the correct moves? Ever tracked
where you would have been if you had followed the advice to stay in?
Yes, I pulled the plug myself after watching $70K disappear over an 8
month period. And it stayed down pretty much for several years after that.

When I decided to get back in I went with a new money manager and of all
people he said that I had timed the market well as far as getting back
in goes.

Last time around the big 3 indexes were still down compared to where I
am now as apposed to before it crashed last year. Basically when the
market came back to where it was last year I was better off.

Perhaps you did time it correctly or perhaps you just assume that you
did. Only you can determine that. Well, your advisor probably could too,
assuming he knows what moves you made and when.
Not an assumption. I track the major indexes too.

Are you invested in the indexes that you track? IOW, were you tracking
your actual investments too? Just curious, that's all.

There is often quite a dispersion between managed funds and the indexes -
both above and below, especially when there is volatility. Some fund managers
handle it quite well, some not so much.



I know you aren't talking about hard core market timing or panic moves,
but missing even a few of the market's best days can be detrimental.
This article deals more with the standard definition of market timing,
so feel free to disregard most of the text and just review the "How
much exactly?" section.

https://www.fool.com/investing/2020/...market-days-c/

Yes, I know, maybe you missed some good days but you offset it by
missing some of the bad ones too. I get it. Like I said, the only way
to really know is to go back and chart where you would be today
if you stayed in - assuming you care. If doing it your way makes you
feel better, that's fine too. My only point is that if you want an
accurate answer to your question "Why in the world ride it to the
bottom?" you'd have to actually figure it out using your numbers and
your moves.

I'm certain that I indeed did not make the perfect moves but better than
doing nothing.

My investment in the market is pretty much emergency money and or what I
plan to pass on to my son. I do not want to put myself in the position
of being at a low with the market and needing money at that point.

The market remained down for several years after the tech stock crash 20
years ago. I knew that the pandemic reaction would be temporary and I
decided to not ride it to the bottom but get back in when the fear in
the market subsided.

And the feel better factor is a big part, I sleep better at night and
that is important for me.

On Wednesday, May 12, 2021 at 8:01:45 AM UTC-4, dpb wrote:
On 5/11/2021 11:17 PM, DerbyDad03 wrote:
On Tuesday, May 11, 2021 at 8:58:40 PM UTC-4, dpb wrote:
...
It's especially easy if your IRA is set up with check-writing
privileges-- you can write the check yourself rather than have the
holder of the IRA do it for you.

Sure, you can write the check, but you better have cash in your IRA or
the ability to raise cash on your own. Some firms allow client trading
in IRA's, some don't.
Well, if you are one who doesn't keep track of and ensure the cash is
where you want it, then yes, Virginia, this option is probably not for
you...

Just pointing possible issues for the uninformed. These subtleties may be
obvious to some folks, but I'm sure you can see from this discussion that the
level of knowledge varies.

My comments weren't addressed directly at you, but your "teaching moment"
check writing comment opened the door for another teaching moment that
added some details for folks to be aware of. We're both just trying to help.

Having a checkbook associated with a basic checking account is very
different than having a checkbook associated with an IRA. The balance
shown in a basic checking account is all cash. You either have enough
cash in the account to cover the check or you don't. "The balance in my
checking account is $10K. My $5K check will be covered."

In the IRA situation, I can certainly see a certain segment of IRA's owners
saying "The balance in my IRA is $50K. My $5K check will be covered."
Unless $5K of the $50K is in cash, the check will bounce. The writing of
the check is not (at least in my experience) going to trigger a trade to cover
it. Some folks might not make that distinction.

I'd wager that if you asked a bunch of random IRA owners if they are allowed
to have a checkbook for their IRA account, many, if not most, wouldn't be sure.
Then ask them if they know how it would work with regard to having cash
available, how withholding taxes are handled, on what date the distribution
is recorded, etc. and I'd wager that most would not be able to answer those
questions.

The main drawback is the inability to control when the cash is withdrawn.
The distribution doesn't happen until the "personal" check is deposited by
the charity. If the custodian issues the check, the distribution occurs on
the day the check is issued.

Worst case is you decide to do a QCD as your RMD late in the year and the
charity holds your check until January. Technically you would be on the hook
for a IRS penalty of 50% of the RMD because you never really took your RMD
for the previous year. You could probably get out of it, but it would take some
work. I'm just saying that letting the custodian issue the check eliminates that
issue.
...

Find a better-managed charity to which to donate and/or don't wait until
the last minute...


By the time you find out that your check wasn't cashed in what you might
consider a timely manner, it's a little late to find a "better-managed charity",
at least for that year. By that time, the harm has been done.

Or, the check writer might think that the distribution is recorded based
on the date that they put on the check or maybe the postmark date on the
envelope. Those are not unreasonable assumptions to make, but it's not
how it works in the QCD world.

Assuming that you deal one-on-one with donors in your capacity as
President of the local community college foundation, I'm sure that you
have had to hold their hands on occasion as they navigate the complexity
of the chartable donation arena. Even the richest, most knowledgeable
business people often need some help. That's all I'm trying to do for those
following this thread.

On 5/12/2021 12:00 PM, DerbyDad03 wrote:
On Wednesday, May 12, 2021 at 9:28:37 AM UTC-4, Leon wrote:
On 5/11/2021 10:35 PM, DerbyDad03 wrote:
On Tuesday, May 11, 2021 at 4:59:51 PM UTC-4, Leon wrote:
On 5/11/2021 1:20 PM, dpb wrote:
On 5/11/2021 9:29 AM, Leon wrote:
On 5/10/2021 3:07 PM, dpb wrote:
Snip

When conditions change (as they will, eventually) to a more historical
pattern, I'll adjust the mix to match; meanwhile I see no reason not to
ride the rocket as long as can...

Do have to pay attention and be willing to "pull the plug!" when it's
time this way, though, granted, and not leave it all up to somebody else.

I certainly take broker's advice/recommendations into account, but don't
wait around for him to tell me it's time to move--he has a ticker that
gives him flags, but he's also got a bunch of other clients (as all do)
so can't rely on being the first on the call list.

--

Exactly, I have had more than one conversation with moth of my money
managers concerning the OBVIOUS.

It there is bad news on the networks. The long time awaited tech stocks
crash leading up to the first quarter in 2000. and then The Corona virus
at the first of last year.

Their answer is, it will come back. My response, why in the world ride
it to the bottom? Get back in "near the bottom. Get out until the the
stocks come back up. And I am not talking about knee jerk market
reactions.

Yes it is hard to tell when the recovery starts but some thing are obvious.

Have you ever verified that you made the correct moves? Ever tracked
where you would have been if you had followed the advice to stay in?
Yes, I pulled the plug myself after watching $70K disappear over an 8
month period. And it stayed down pretty much for several years after that.

When I decided to get back in I went with a new money manager and of all
people he said that I had timed the market well as far as getting back
in goes.

Last time around the big 3 indexes were still down compared to where I
am now as apposed to before it crashed last year. Basically when the
market came back to where it was last year I was better off.

Perhaps you did time it correctly or perhaps you just assume that you
did. Only you can determine that. Well, your advisor probably could too,
assuming he knows what moves you made and when.
Not an assumption. I track the major indexes too.

Are you invested in the indexes that you track? IOW, were you tracking
your actual investments too? Just curious, that's all.

Yes. I use https://www.fundmanagersoftware.com/



There is often quite a dispersion between managed funds and the indexes -
both above and below, especially when there is volatility. Some fund managers
handle it quite well, some not so much.


Yes but the major indexes typically predict the temper of the markets.

My money manager is continuously buying and selling so it can be a
challenge to keep up with it.




I know you aren't talking about hard core market timing or panic moves,
but missing even a few of the market's best days can be detrimental.
This article deals more with the standard definition of market timing,
so feel free to disregard most of the text and just review the "How
much exactly?" section.

https://www.fool.com/investing/2020/...market-days-c/

Yes, I know, maybe you missed some good days but you offset it by
missing some of the bad ones too. I get it. Like I said, the only way
to really know is to go back and chart where you would be today
if you stayed in - assuming you care. If doing it your way makes you
feel better, that's fine too. My only point is that if you want an
accurate answer to your question "Why in the world ride it to the
bottom?" you'd have to actually figure it out using your numbers and
your moves.

I'm certain that I indeed did not make the perfect moves but better than
doing nothing.

My investment in the market is pretty much emergency money and or what I
plan to pass on to my son. I do not want to put myself in the position
of being at a low with the market and needing money at that point.

The market remained down for several years after the tech stock crash 20
years ago. I knew that the pandemic reaction would be temporary and I
decided to not ride it to the bottom but get back in when the fear in
the market subsided.

And the feel better factor is a big part, I sleep better at night and
that is important for me.

Leon [email protected] writes:
On 5/12/2021 12:00 PM, DerbyDad03 wrote:

[huge snip]


Are you invested in the indexes that you track? IOW, were you tracking
your actual investments too? Just curious, that's all.

I think by 'invested in the indexes' Derby was asking if you
own an index fund or ETF (e.g. DIA or IVV).


Yes. I use https://www.fundmanagersoftware.com/

E*Trade Pro does most of this - it's a great java app
that tracks your full portfolio real-time, and has trading
and research capabilities.




There is often quite a dispersion between managed funds and the indexes -
both above and below, especially when there is volatility. Some fund managers
handle it quite well, some not so much.


Yes but the major indexes typically predict the temper of the markets.

The VIX (Volatility index) is probably the most accurate predictor.

It has risen from 16 to 27 in the last week.


My money manager is continuously buying and selling so it can be a
challenge to keep up with it.

And who pays the commissions for all those trades?

On Wednesday, May 12, 2021 at 6:26:10 PM UTC-4, Scott Lurndal wrote:
Leon [email protected] writes:
On 5/12/2021 12:00 PM, DerbyDad03 wrote:
[huge snip]

Are you invested in the indexes that you track? IOW, were you tracking
your actual investments too? Just curious, that's all.
I think by 'invested in the indexes' Derby was asking if you
own an index fund or ETF (e.g. DIA or IVV).

Yes. I use https://www.fundmanagersoftware.com/
E*Trade Pro does most of this - it's a great java app
that tracks your full portfolio real-time, and has trading
and research capabilities.



There is often quite a dispersion between managed funds and the indexes -
both above and below, especially when there is volatility. Some fund managers
handle it quite well, some not so much.


Yes but the major indexes typically predict the temper of the markets.
The VIX (Volatility index) is probably the most accurate predictor.

It has risen from 16 to 27 in the last week.

My money manager is continuously buying and selling so it can be a
challenge to keep up with it.
And who pays the commissions for all those trades?

Sorry...I couldn't resist. Just trying to keep it light.

https://static.wikia.nocookie.net/tw...er-Churner.jpg

On 5/12/2021 5:26 PM, Scott Lurndal wrote:
Leon [email protected] writes:
On 5/12/2021 12:00 PM, DerbyDad03 wrote:

[huge snip]


Are you invested in the indexes that you track? IOW, were you tracking
your actual investments too? Just curious, that's all.

I think by 'invested in the indexes' Derby was asking if you
own an index fund or ETF (e.g. DIA or IVV).


Not an index fund,, normally a combination of 25~35 different mutual
funds by multiple
fund managers, through my money manager and Raymond James.



Yes. I use https://www.fundmanagersoftware.com/

E*Trade Pro does most of this - it's a great java app
that tracks your full portfolio real-time, and has trading
and research capabilities.







There is often quite a dispersion between managed funds and the indexes -
both above and below, especially when there is volatility. Some fund managers
handle it quite well, some not so much.


Yes but the major indexes typically predict the temper of the markets.

The VIX (Volatility index) is probably the most accurate predictor.

It has risen from 16 to 27 in the last week.


My money manager is continuously buying and selling so it can be a
challenge to keep up with it.

And who pays the commissions for all those trades?


I pay the commissions through individual funds and or 1% annually of my
portfolio value to my money manager.