quote:

Originally posted by 2PAK:
I like Vanguard investments but don't like their UI.

I get that. Their website UI does kinda suck.

However, for "hands off" investors like me, it's just fine.

Fidelity and Vanguard are both good.
Roth, IRA 401K etc. are tax treatments, not types of investments.
Those two are the best, but watch out, there are a bunch of snake oil salesman in that market. Your best insurance is to read up and develop a basic understanding of how investments work. You don't have to become an expert but you want to know if someones blowing smoke up your behind and there's no other way besides doing some homework.
If anyone mentions the word annuity, run.

Be aware of this:
Public-sector employees subject to GPO rules will see their Social Security benefits reduced by two-thirds of the non-Social Security retirement benefit.
For me, I am eligible for zero

quote:

Originally posted by ArtieS:
The other kind of broker charges a fee, typically 1% of investment (paid .25% quarterly) on the value of the invested money at the start or end of the quarter. This fee is paid on total assets, and is paid whether the value of your investments went up or went down.
...

If you can find a smart, reliable guy I think that the asset based fee broker is CLEARLY the smart way to go.

This is the way we went, based on a recommendation from a friend who'd been with our guy for quite a few years. We've been with him and his team for four years and have averaged a return of +-13%, year-to-year.

quote:

Originally posted by mrvmax:
...If you have never managed your own accounts I would put some money into one and start doing it now to see how it goes. FYI if you retire earlier than 59 1/2 you can pull money from a company sponsored IRA penalty free at 55 (but is is taxable).

I’ve done some very minimal self management over the years, state system has a few different fund options. That is my idea with starting Roth IRA soon using savings. Will let whoever I go with mange some and I will “play” with some to get a feel of the process.

My understanding is so long as I roll it over, no taxes if I retire before 59.5. If not, not a problem to just leave in the state system until that point. Can actually just leave it there if I choose, but my understanding is they are limited in flexibility of disbursements and expect you to just have the same amount each month.

My preference is to draw when needed and leave when not, with the amount varying monthly.


We have a new boss at work who is making things cumbersome. I have planned for a number of years to retire with 30 years service and that happens just a few months after the magic age of 59.5.

The way things are looking, I could possibly pull the plug a year earlier if I get fed up with their shit, but it would cost me right about $1000 a month in the defined benefit portion and I would be starting with a lower balance than expected in the defined contribution portion.

Trump economy however did accelerate the defined contribution amount, so it is already ahead of what I had expected it to be at now. Don’t want to leave the $1000 a month on the table and I would have to get REALLY pissed to pull the pin early but as of this month I am 18 months away from 59.5 so need to start figuring this stuff out.

quote:

Originally posted by 220-9er:
Fidelity and Vanguard are both good.
Roth, IRA 401K etc. are tax treatments, not types of investments.
Those two are the best, but watch out, there are a bunch of snake oil salesman in that market. Your best insurance is to read up and develop a basic understanding of how investments work. You don't have to become an expert but you want to know if someones blowing smoke up your behind and there's no other way besides doing some homework.
If anyone mentions the word annuity, run.

I understand IRA’s are just a type of account and it is the wheeling and dealing with the money in those accounts that makes them grow.

I’ve already learned that “annuity” is a long 4-letter word and to stay away

quote:

Originally posted by Mikus36:
Be aware of this: Public-sector employees subject to GPO rules will see their Social Security benefits reduced by two-thirds of the non-Social Security retirement benefit.
For me, I am eligible for zero

My gubberment job suffers no SS reduction as I have paid in the entire time. WA state DRS (Dept of Retirement Systems) is an addition to SS. They cover most State and local government jobs.

quote:

Originally posted by ensigmatic:
...

If you can find a smart, reliable guy I think that the asset based fee broker is CLEARLY the smart way to go.

This is the way we went, based on a recommendation from a friend who'd been with our guy for quite a few years. We've been with him and his team for four years and have averaged a return of +-13%, year-to-year.[/QUOTE]

+/- 13%, as in -13% to +13% or 13% +/- as in 10%-15%? Hoping it is the latter.

A comment about a Roth ... yes you should have one. Yea you should have ones one long ago. The markets are at all time highs... with a complete idiot in the White House ... expect a market correction in the next six months. Don’t expect 7% returns. You can expect to lose quite a bit of money if you choose the wrong place to put your money.

I have Vanguard and fidelity accounts and both are good companies and easy to work with in my experience.

Have you tried Monte Carlo simulators?

quote:

Originally posted by 911Boss:
A little more info on my situation...

When I retire from my employer I will be retired, if all goes as planned I’ll be 59.5 years old and starting to collect immediately.

Currently our combined income from two sources is “X” and I figure to be comfortable I need about 85% of X at the start of retirement, adding in a “cushion” I would like to plan on 90%.

Source 1, my current pay is 72% of “X”
Source 2 is 28% and won’t be changing.

At start of retirement, I will have four sources:
1- Defined Benefit Pension which should be approx 29% of current “X”
2- Same as above, 28%
3- Defined Contribution (money being rolled into IRA), planning for disbursements to provide 33% of “X” initially, but will reduce as time goes on at 62, 65, and 66ish
4- Current savings, some potentially being moved into Roth IRA -reserve not touched initially.


I plan to take early SS at 62, adding a 5th source that should be approx 25% of current “X”. This will allow me to reduce IRA disbursements to 8%.

At age 65 when we both qualify for Medicare, monthly expenses should drop to allow 80-85% of X to be sufficient, and sometime shortly after that the sale of our house and moving out of WA state will further reduce budget hopefully allowing for 70-75% of “X” to be sufficient.

Initially, the annual disbursement from the IRA would be about 8% of the expected starting balance. At 62 it would drop to an estimated 5%, then would not be any regular disbursements from age 66 or so on.

At that point:
1- 29%
2- 28%
3-
4-
5- 25%
Total = 82%

Should no longer need regular IRA disbursements so those can grow to be reserves to cover unexpected expenses, inflation, travel, etc.


I’ve done a couple of Excel “what if” spreadsheets and basically as long as the employer rollover account averages 4.5-5% or better, That combined with current savings at no appreciable interest, I should only need to draw on the IRA for the first 8-10 years and then no longer. Would still have a savings cushion and the IRA would be growing from that point on.

I stopped my spreadsheet at age 90 as it seemed pointless to continue watching balances increase and I don’t expect to live that long anyway.

Fidelity had my employer's 401K investment plan, and when I retired I stuck with Fidelity.

Most of what I have with them, I employ them to manage, two IRA's and a managed asset account with all three accounts basically reinvesting all earnings.

I am more than pleased with the performance Fidelity has achieved. The account managers are professional and yet personable, plus I like their website much more than Vanguard's from the standpoint of usability, and information provided.

I have nothing against Vanguard as they are obviously a great company.

This message has been edited. Last edited by: BigWhup,

quote:

Originally posted by smlsig:
I started out investing with Fidelity in the mid 80’s, went through the crash of ‘87 where I sold my Magellan (big mistake). Then I went to Vangaurd for several years but felt that the depth of their research teams wasn’t as good as Fidelity’s so in the 90’s I went back and have been with them ever since.

I retired from my primary company 2 years ago and at that time sliced off a portion of our portfolio to their managed accounts. Their returns have been fair but my own accounts have faired better but my Beta is also higher and therefore riskier than what they have managed. For some reason they like bond funds which I have never been convinced make any sense but I’m OK with them making the choices in that sub account.

There were a couple of comments above about just putting your money in a low fee index fund and letting it ride which is not a bad idea in and of itself but, for me anyway, there are better options out there. Would you pay a higher fee of say 1 to 1.5% if your return was 5 or more percent higher over the long term? That is my philosophy and what I’ve done with quite a bit of success...

I’ll give you 3 different funds that have consistently over performed in the long run...

1. Fidelity Blue Chip Growth. FBGRX
It has a 10 year average of 19.32%/year and a lifetime (since 12/87) average annual return of 13.32%

2. Fidelity Contrafund. FCNTX
It has a 10 year average of 15.2%/ year and a lifetime (since 5/67) average annual return of 12.8%

3. Fidelity Select Semi Conductor FSELX.
It has a 10 year average of 20.8% / year and a lifetime (since 7/85) average annual return of 13.64%.

These 3 funds along with a few others make up the bulk of our portfolio. It is hard to argue that these are some of the best long term managed funds in the whole investment market. Averaging 7% over the long term with funds like these is a strong possibility but as stated above I would not, and do not, plan on pulling out that much each year...

Smlsig,

For your listed funds, are they in an IRA style account, our straight investments with after tax dollars? I've been playing with Fidelity mutual funds, specifically IALAX and ACFOX, in non-IRA funds, funded by after tax paycheck dollars. My rationale is to not be hit with a penalty if I need the money back for an emergency. According to Fidelity, "A distribution from a Roth IRA is tax-free and penalty-free, provided the 5-year aging requirement has been satisfied and one of the following conditions is met: age 59½, disability, qualified first-time home purchase, or death."

My feeling is that one way or another, I'll be taxed on it in the future and I'm merely eliminating the penalty if I need the money within 5 years. In your opinion, is what I'm doing tax wise? I'm 47 years old.

On a side note, I spoke with my tax preparing guy as to his opinion for wise retirement investments. His take was to invest in something that didn't take a substantial hit in 2008 and remains relatively consistent through the years. The problem I have with that is far less earnings. For example, a mutual fund lost 4% in the 2008 crash, but came back beautifully the next year and has made consistent gains over easily 10% each year. I'd rather invest in that fund than something that can withstand a bear year, but only has low average return.

Thank you,

Lonnie

quote:

Originally posted by 911Boss:

quote:

Originally posted by ensigmatic:

quote:

Originally posted by ArtieS:
If you can find a smart, reliable guy I think that the asset based fee broker is CLEARLY the smart way to go.

This is the way we went, based on a recommendation from a friend who'd been with our guy for quite a few years. We've been with him and his team for four years and have averaged a return of +-13%, year-to-year.

+/- 13%, as in -13% to +13% or 13% +/- as in 10%-15%? Hoping it is the latter.

±13%. Tablet doesn't have the "±' keyboard/character encoding.

I have had a Fidelity 401K for about 23 years even though I left the employer I had it through 6 years ago. The company recently went belly up and I had to do something with the money.

I was always happy with Fidelity so chose to stick with them. I rolled it into an IRA and then had to decide to either just pick a plan or have it fully managed. I chose to let Fidelity fully manage it and I could not be happier. I wish I had done this a long time ago. My account has been making way more money than it ever has!

I made the change in November 2020 and as of 1/31/21 my rate of return is 8.86%.

Been with Fidelity for 30+ plus years. I like their website which includes a lot of tools to analyze and help you make informed decisions. You can also buy funds from other investment firm like Vanguard with no fees and keep them in your Fidelity account.

Their fees are among the lowest I've found. Here's a comparison.
Fidelity Fees

I went with an Independent Finaicial Manager when I no longer had the time needed to fully investigate and manage all my investments. I wanted someone who's hands on all the time and had a proven track record.

Been with him around 25 years at this point and he does a great job, makes me a lot of money.

Update-

Opened two Fidelity Roth IRA accounts today, one for me and one for my wife.

Put equal amounts in each account and am letting Fidelity manage one while I play with the other by picking Fidelity mutual funds.

Will see what happens over the next couple of months and adjust as appropriate. 6-8% and I will be happy, anything more is gravy. Anything less, absent market tragedy striking, it still has to do better than the .01% the money was earning in a savings account.

Good for you, you're on your way. Let me mention though, most diversified mutual funds move slowly. Like turning the Queen Marry. So a couple of months may not be a good gauge of longer term performance. Fidelity does have some very good research tools on their website, and they do not hide or misrepresent poor preforming funds, be it their own or third party funds.

quote:

Originally posted by 911Boss:
it still has to do better than the .01% the money was earning in a savings account.

Word.

quote:

Originally posted by NavyGuy:
So a couple of months may not be a good gauge of longer term performance.

Especially considering it looks like we're currently headed into a bit of a short term dip.

Diversified funds (like index funds) are about long-term performance.

quote:

Originally posted by NavyGuy:
Good for you, you're on your way. Let me mention though, most diversified mutual funds move slowly. Like turning the Queen Marry. So a couple of months may not be a good gauge of longer term performance. Fidelity does have some very good research tools on their website, and they do not hide or misrepresent poor preforming funds, be it their own or third party funds.

I get that, just starting so want to go slow and see what happens as I learn. I split the account I am “managing” into three funds to start. FSKAX, FFIDX, and FCPEX. Two of them are 4/5 Morningstar ratings, the third is 2/5.

I am hoping it will give me something to compare against the account Fidelity will be managing and watching/comparing the two together over time will help me learn.

Slightly above avg earnings, slightly above avg risk. All were recommend by various web resources, as are a bunch of others, but at some point you have to pick something.


This is all money out of savings, and while a considerable amount, it is pretty small compared to the bulk of my retirement savings. I can spend the next 18 month learning the ropes and then when it comes time to retire and roll over my work 401, I hope to be in a position of better understanding.

quote:

Originally posted by RogueJSK:

quote:

Originally posted by 911Boss:
it still has to do better than the .01% the money was earning in a savings account.

Word.

quote:

Originally posted by NavyGuy:
So a couple of months may not be a good gauge of longer term performance.

Especially considering it looks like we're currently headed into a bit of a short term dip.

Diversified funds (like index funds) are about long-term performance.

This is definitely long term. I imagine I will check in every week or two to start, but as time goes by that interval will increase. I won’t be chasing daily changes or moving stuff around with any frequency.

All three have acceptable (to me) 5-10 year return rate in low double digits. As long as at the end of the year the ups and downs stay in the black, I’ll be satisfied.


Now once I get the hang of things I might start playing around with a few dollars on individual stocks, but that is a ways out.