How the hell are we supposed to retire?

rick81721

Lothar

w_b

Well-Known Member
I just went thru it again last night, when my 12 YOs told me they needed jobs (LOL):
  1. work hard and long
  2. live within your means
  3. take care of your stuff
  4. invest what you can for the future, consistently
  5. get 10% a year average return
THAT's HTH we are supposed to retire!

My Dad did 1 thru 4, didn't quite get #5 all the way, but he's doing OK so far; after 16 years of retirement (and turning 82 next week)
Go Dad!
 

w_b

Well-Known Member
And doing it still in NJ right? Very impressive!
The whole "lower your cost of living in retirement" thing never occurred to him.
Now he's not as spry as he was, so he's not MTB'ing with me anytime soon, but he figured it out.

Few more years, my kids outta collage, then feet up.
 

Bike N Gear

Shop: Bike N Gear
Shop Keep
Anyone familiar with Blackrock's separately managed accounts? Advisor is recommending moving our muni bonds to a Blackrock Municipal Fixed Income fund managed by Blackrock for increased diversification.
 

Patrick

Overthinking the draft from the basement already
Staff member
Anyone familiar with Blackrock's separately managed accounts? Advisor is recommending moving our muni bonds to a Blackrock Municipal Fixed Income fund managed by Blackrock for increased diversification.

is diversification in govt backed bonds a thing?
They should be able to post a historical record of winning against what you are doing now, otherwise it seems like a commission grab.

I'm just buying/reinvesting VNJUX for tax exempt incl NJ. Took a little hit with the interest rate rise,
but there is a delay effect as new bonds paying more are issued.

The only reason to be in munis is tax efficiency - otherwise corporate paper makes significantly more.
 

Bike N Gear

Shop: Bike N Gear
Shop Keep
is diversification in govt backed bonds a thing?
They should be able to post a historical record of winning against what you are doing now, otherwise it seems like a commission grab.

I'm just buying/reinvesting VNJUX for tax exempt incl NJ. Took a little hit with the interest rate rise,
but there is a delay effect as new bonds paying more are issued.

The only reason to be in munis is tax efficiency - otherwise corporate paper makes significantly more.
Expenses are lower for the Blackrock account than VNJUX. We were told .07 total. .03 to our advisor and .04 to BR. Or visa versa.
 

Bike N Gear

Shop: Bike N Gear
Shop Keep
is diversification in govt backed bonds a thing?
They should be able to post a historical record of winning against what you are doing now, otherwise it seems like a commission grab.

I'm just buying/reinvesting VNJUX for tax exempt incl NJ. Took a little hit with the interest rate rise,
but there is a delay effect as new bonds paying more are issued.

The only reason to be in munis is tax efficiency - otherwise corporate paper makes significantly more.
Forgot to mention. With this account it's managed by BR, but we own the assets.
 

Carson

Sport Bacon
Team MTBNJ Halter's
I'm in a few different brokered CDs at Vanguard. 3 months, 5.15% APY. Waiting for the bottom to drop... but it's not.
 

Patrick

Overthinking the draft from the basement already
Staff member
Good question. Our CFP talked about municipal bond funds for our post-tax house sale proceeds. Will have to decide soon what we are going to do. I suggested to wifey put it all on black on roulette but she was nor amused.

They work best when there is state and local tax, since they would be triple tax free. Is cfp recommending a fund or actual bonds?
 

Fire Lord Jim

Well-Known Member
If you think interest rates are at a peak, CDs make a lot of sense. If you think interest rates have more to go, money market funds make a lot of sense. When the CDs I bought in January (4.3%) matured, I just put the proceeds in money market accounts. I'm getting better than 5% with no lock-in. You can also get that with a brokered CD. However, when rates increase, the brokered CD value decreases while the money market rate increases, so it makes for a nice set it and forget it plan.

One reason to do a CD rather than money market: if you are targeting your income to fall below some cap, a CD maturing after December will defer the interest to 2024 whereas the money market will continue to create 2023 interest income.
 
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