• Journey to Financial Independence

    The path to financial independence has a few distinct milestones that can help you determine where you are in your journey. With the benefit of hindsight I take a look at how I might have done things differently if I could do it all over again. Additionally, I propose a better rule-of-thumb for how much to invest in bonds. ... more
  • To Roth or Not to Roth - Part 3, Retiring at Age 70

    In this article, we continue to analyze how much money should be allocated to Roth vs non-Roth contributions in a retirement account. Specifically we look at the case of delaying taking distributions until age 70 which corresponds to the age when distributions are required. ... more
  • Super-Simple Virtual-Buffer Withdrawal Strategy - Revisited

    While the concept of this withdrawal strategy is simple, the original presentation of it was overly complex. In this rewriting, I attempt to show that it really is a simple strategy that anybody can implement. ... more
  • To Roth or Not to Roth? - Part 2, Reframing the Question

    In Part 1, I discussed a hypothetical construct for figuring out how much to contribute to a Roth that was more academic than practical. In this article, instead of looking at how much to put into a Roth, I want to reframe the discussion as one of determining the maximum amount you should put into a Traditional account. ... more
  • How Social Security Messes With Your Tax Brackets

    Social Security is a great source of basic income for many retired people. But most people probably don't understand how Social Security income affects their taxes which could influence their decisions regarding the use of tax-deferred investment vehicles such as traditional IRAs. ... more
  • To Roth or Not to Roth? - Part 1, The Ideal World

    In the financial blog world there are conflicting opinions on whether to use a Roth over Traditional option in for qualified investments. This post explores a simple way on how to think about whether you should use the Roth option in your 401k/403b/IRA investments and gives some insights on how much to allocate to each. ... more
  • Radioactive Half-Life of Expenses

    Expenses eat away at your portfolio value over time, much like the decay of a radioactive isotope. ... more
  • Super-Simple Virtual-Buffer Withdrawal Strategy

    While the 30-30 Withdrawal Strategy is a pretty simple way to withdraw your money from your portfolio at a rate of 3.33%, it does require a little bit of bookkeeping and is limited to a single withdrawal rate. In this article, I look at simplifying that withdrawal strategy even further. ... more
  • Affordable Care Act May Increase Your Marginal Tax Rate

    While doing my taxes this year and playing with possible income changes in the tax software, I noticed a curious phenomenon. Instead of my taxes changing by my marginal tax rate for any change in income, it was changing by almost 10% more than I expected. After doing a little research, I narrowed down this unexpected increase of my marginal tax rate to the Affordable Care Act insurance premium credits and how these credits are phased out with increased income. ... more
  • HSA Tax Advantages

    Health Savings Accounts have many tax-related benefits. Here's a short list of some well-known plus a few lesser known benefits to owning an HSA. ... more
  • Vanguard Managed Payout Quacks Like a Buffered Withdrawal

    Vanguard has a fund called the Managed Payout Fund that is "designed to give you regular monthly payouts". The way that this fund calculates the monthly payouts happens to be remarkably similar to the buffered withdrawal strategy discussed in previous articles on this blog. ... more
  • The 30-30 Withdrawal Strategy

    If you want to implement a simple safe withdrawal plan that buffers the volatility of the market then here's a plan that might work for you. ... more
  • Two Types of Income

    At the most basic level, any income stream you will have in retirement has one of two possible types. ... more
  • Comparing Target-Date Fund Glide Paths

    While all target-date funds implement the concept of a glide path for asset allocation, they all have differing ideas on what the ideal path should be. In this article we will compare glide paths for some of the biggest and least expensive target-date funds. ... more
  • Estimating Your Social Security Benefit for an Early Retirement

    How much will your Social Security benefit be if you retire before your full retirement age? ... more
  • Building a Bridge to Social Security

    You may be able to retire earlier than you think if you factor in how much social security or pension income you will receive in the future. ... more
  • Buffer Withdrawals to Stabilize Income

    Withdrawing money from your portfolio using a fixed percentage can guarantee that you'll never run out of money but it also ties the the volatility of your income the returns of your portfolio. Buffering the withdrawals can reduce that volatility to a more tolerable level. ... more
  • Safe Withdrawal Rates for Vampires

    If you're going to live forever, will a 4% withdrawal rate sustain you? This article explores the withdrawal rate that will help you keep up with inflation for the really long term. ... more
  • Maximize Your Employer Match before Using a Roth 401(k)

    If you are contributing to a Roth 401(k), are you getting the full employer match? If not, you are probably leaving money on the table. ... more
  • How to Take Early IRA Withdrawals without Penalty

    The Substantially Equal Periodic Payments (SEPP) rule, also known as Internal Revenue Code section 72(t), is one way to legally withdraw your traditional IRA funds without incurring the early-withdrawal penalty. This article describes how to calculate your SEPP payments and how to determine the size of the account from which you will be taking your payments. ... more
  • A Penny Saved Is Four Dollars Earned

    What is the true impact of spending relative to how much you need to save to support that spending in retirement? ... more