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For this article, his staff pulls tidbits that might be true in some situations, and then generalizes them to always true in order to create some sensationalism.
With so much good and reliable information available, just ignore Kiyosaki.
Bingo.......he was only rich for selling books to suckers.
401k plan is a horrible plan because it has so much limitations. It is essentially like long term CD.
Incorrect.
Quote:
Originally Posted by MKTwet
What's really bad about it is that you may get locked into a really bad fund and they are eating your portfolio away with fees ...
OR -- stay with me here -- your plan administrator provides superior funds with expenses below those available at retail, outstanding administrative performance, and whose administration fees are de minimis.
Now think about this. Why are people assuming that their income in retirement is going to be higher than when they're working?
I'm retired (no RMDs yet) and in the top marginal income tax bracket. The final twenty years prior to retirement, I also was in the top marginal income tax bracket.
Quote:
Originally Posted by RayHammer
I'm planning on my waged income bracket to be zero in retirement
In retirement, I no longer have a paycheck and hence have no "waged income" and I am still in the top marginal income tax bracket.
How do you know the matching isn't negated by fees and bad fund selection?
Because I have a calculator and know how to use it.
Also I sat on the Investment Policy Committee and we negotiated with plan administrators.
Quote:
Originally Posted by MKTwet
401ks are all bad.
Incorrect.
Look, a famous economist once said, "Nothing is either good or bad save the alternatives make it look that way." As with all investment decisions, it is important to do your homework and, with your eyes wide open, make an informed decision.
Last edited by moguldreamer; 12-06-2023 at 08:32 AM..
Any amount over 0% allocated to bonds is way, way too much..
Incorrect.
One of the first lessons of modern portfolio theory is that determination of how much risk to incur, and the optimal portfolio of risky assets for the chosen level of risk are two independent questions.
And any graduate student of finance, with a few white boards and some not terribly advanced mathematics, can show a zero-bond portfolio does not lie on the efficient frontier in that it is trivial to construct a portfolio that for the same level of risk provides a higher expected return and similarly it is trivial to construct a portfolio for that level of expected return that has lower risk.
A zero-bond portfolio, just like its cousin a 100% equity portfolio, is rarely (if ever) on the efficient frontier. If these concepts are foreign to you, spend a moment googling & reading modern portfolio theory, efficient frontier, optimal portfolio construction and asset allocation.
And any graduate student of finance, with a few white boards and some not terribly advanced mathematics, can show a zero-bond portfolio does not lie on the efficient frontier in that it is trivial to construct a portfolio that for the same level of risk provides a higher expected return and similarly it is trivial to construct a portfolio for that level of expected return that has lower risk.
A zero-bond portfolio, just like its cousin a 100% equity portfolio, is rarely (if ever) on the efficient frontier. If these concepts are foreign to you, spend a moment googling & reading modern portfolio theory, efficient frontier, optimal portfolio construction and asset allocation.
Is that true? If you just use two asset classes, I would think a 100% equities position would be on one end of the efficient frontier, and 100% bonds on the other. Can you create a lower-volatility equivalent return portfolio with a mix of equities and bonds than with just 100% equities?
with better tax planning and delaying socal security , a couple can draw out 27,700 a year tax free from ira money with the standard deduction alone as a minimum for up to 8 years and more if over 65 .
one could set a side a few years cash , some roth accounts ,as well as over fund a life insurance policy and borrow it out and have very low income while delaying ss .
had i planned better we could have had a 100k income while delaying ss and taken hundreds of thousands of dollars out tax free over 8 years
but all those years before retirement i thought i knew all i needed to know because i was doing well as an investor AND DIDNT NEED PROFESSIONAL HELP
wrong
up to now our taxable income was in the 12% bracket but with all the interest now generated and me working a bit that will likely change .
however only the portion above the 12% bracket will be taxed higher .
we will definitely take a jump in two years when my rmds start
Wow! Thanks for acknowledging that taking SS later can be a good strategy
Wow! Thanks for acknowledging that taking SS later can be a good strategy
depends .
the problem is most americans can not afford to delay and retire earlier .
even fewer with such low incomes and little taxable income would have tax planned with a mix of roths , over funded life policies and had enough cash to lay out to live on in advance for years as well as use the zero capital gains bracket for income .
this is wealthier people planning
so whole different scenario here
Last edited by mathjak107; 12-06-2023 at 10:15 AM..
Location: Was Midvalley Oregon; Now Eastside Seattle area
13,072 posts, read 7,511,991 times
Reputation: 9798
Quote:
Originally Posted by mathjak107
while rmds can exceed 4% that doesn’t mean you can spend all of it either .
our rmds as of now go right back in the same fund they came out of in our taxable account , preserving the income generation ability of the portfolio
I know don't have that much self discipline.
Or as much wealth.
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