Alt right protests
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17-10-2017, 11:16 AM
RE: Alt right protests
(17-10-2017 10:52 AM)Dom Wrote:  
(17-10-2017 10:33 AM)Stefan Mayerschoff Wrote:  10m from retirement you should be in 70% G fund, and then split the other 30% however you like between C, S and I. Once retired, you should consider moving a portion of it to something like an equity indexed annuity for protection and better than inflation level returns (depending on your need for income obviously - if you need income a variable annuity with a GMIB rider might be the way to go)

Just my professional opinion as a financial planner Smartass

I googled this and came up with that: http://www.pathfinderfs.com/2008/07/bewa...ib-riders/

LOL a little knowledge is such a dangerous thing. I counted 4 errors in the first 2 paragraphs of that piece.

VAs are a very specific product designed for a very specific need, basically to create your own pension from a lump sum asset. The author is dead wrong that you have to annuitize in order to utilize the MGIB rider; the whole point of the rider is so you don't have to annuitize and lose control of your principle amount. I mean, you can annuitize any contract - fixed, equity indexed, whatever, but then you can no longer take any lump sum withdrawals from the principle amount. So if you need more than you annuitized income, you have to call JG Wentworth or some other company that can pay you a lump sum based on a present discounted value of a future income stream.

Anyway, not to sidetrack the thread. Just thought I would throw my 2 cents in.
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17-10-2017, 11:19 AM
RE: Alt right protests
(17-10-2017 11:16 AM)Stefan Mayerschoff Wrote:  
(17-10-2017 10:52 AM)Dom Wrote:  I googled this and came up with that: http://www.pathfinderfs.com/2008/07/bewa...ib-riders/

LOL a little knowledge is such a dangerous thing. I counted 4 errors in the first 2 paragraphs of that piece.

VAs are a very specific product designed for a very specific need, basically to create your own pension from a lump sum asset. The author is dead wrong that you have to annuitize in order to utilize the MGIB rider; the whole point of the rider is so you don't have to annuitize and lose control of your principle amount. I mean, you can annuitize any contract - fixed, equity indexed, whatever, but then you can no longer take any lump sum withdrawals from the principle amount. So if you need more than you annuitized income, you have to call JG Wentworth or some other company that can pay you a lump sum based on a present discounted value of a future income stream.

Anyway, not to sidetrack the thread. Just thought I would throw my 2 cents in.

Why would I ever take my money out of the TSP? I mean that as a serious question. Why would I?

#sigh
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17-10-2017, 11:19 AM
RE: Alt right protests
(17-10-2017 11:05 AM)GirlyMan Wrote:  
(17-10-2017 10:33 AM)Stefan Mayerschoff Wrote:  10m from retirement you should be in 70% G fund, and then split the other 30% however you like between C, S and I. Once retired, you should consider moving a portion of it to something like an equity indexed annuity for protection and better than inflation level returns (depending on your need for income obviously - if you need income a variable annuity with a GMIB rider might be the way to go)

Just my professional opinion as a financial planner Smartass

pffft .. L-funds brother. And annuities are for fools. Tongue

Well, if you're in the 2015 or 2020 L fund, you're just about where I suggested for your asset allocation, so that's good! Your previous comment made it sound like you were altering your allocation manually instead of on the predetermined L fund rebalancing schedule.

I talk with a ton of clients who poo poo annuities all the time LOL - usually it's because they don't understand the first thing about them and just heard or read something somewhere that said "annuities are BAD"

When I ask them why, they have no idea.
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17-10-2017, 11:21 AM
RE: Alt right protests
(17-10-2017 11:19 AM)Stefan Mayerschoff Wrote:  
(17-10-2017 11:05 AM)GirlyMan Wrote:  pffft .. L-funds brother. And annuities are for fools. Tongue

Well, if you're in the 2015 or 2020 L fund, you're just about where I suggested for your asset allocation, so that's good! Your previous comment made it sound like you were altering your allocation manually instead of on the predetermined L fund rebalancing schedule.

I talk with a ton of clients who poo poo annuities all the time LOL - usually it's because they don't understand the first thing about them and just heard or read something somewhere that said "annuities are BAD"

When I ask them why, they have no idea.

Because I want control over the principal if I need it, like you said. That and the ROI pretty much sucks.

#sigh
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17-10-2017, 11:25 AM
RE: Alt right protests
(17-10-2017 11:19 AM)GirlyMan Wrote:  
(17-10-2017 11:16 AM)Stefan Mayerschoff Wrote:  LOL a little knowledge is such a dangerous thing. I counted 4 errors in the first 2 paragraphs of that piece.

VAs are a very specific product designed for a very specific need, basically to create your own pension from a lump sum asset. The author is dead wrong that you have to annuitize in order to utilize the MGIB rider; the whole point of the rider is so you don't have to annuitize and lose control of your principle amount. I mean, you can annuitize any contract - fixed, equity indexed, whatever, but then you can no longer take any lump sum withdrawals from the principle amount. So if you need more than you annuitized income, you have to call JG Wentworth or some other company that can pay you a lump sum based on a present discounted value of a future income stream.

Anyway, not to sidetrack the thread. Just thought I would throw my 2 cents in.

Why would I ever take my money out of the TSP? I mean that as a serious question. Why would I?

There a few reasons to consider. Diversification beyond the 5 fund options in the TSP is primary. You could be looking for local management and easier access to your funds. You might want to do something that protects you against long term care expenses, or creates a tax free multiple benefit to your beneficiaries. You also could need the estate planning offered by a trusteed IRA, although that is most typical in second marriages where the IRA owner wants their spouse to have use of the funds during their lifetime, but still leave any remaining balance to their own biological kids.

TSP is very low cost plan, but also rather limited in its sophistication. I typically always recommend moving from your 401(k) to an IRA that you have more control over once you are no longer an active plan participant, as you lose the biggest benefits of the plan at that time, such as borrowing from yourself, reduced plan costs, etc.
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17-10-2017, 11:29 AM
RE: Alt right protests
(17-10-2017 11:21 AM)GirlyMan Wrote:  
(17-10-2017 11:19 AM)Stefan Mayerschoff Wrote:  Well, if you're in the 2015 or 2020 L fund, you're just about where I suggested for your asset allocation, so that's good! Your previous comment made it sound like you were altering your allocation manually instead of on the predetermined L fund rebalancing schedule.

I talk with a ton of clients who poo poo annuities all the time LOL - usually it's because they don't understand the first thing about them and just heard or read something somewhere that said "annuities are BAD"

When I ask them why, they have no idea.

Because I want control over the principal if I need it, like you said. That and the ROI pretty much sucks.

I'm on board with that. I never use annuities for more than a portion of my client's assets - they always need some unrestricted liquidity. But to take market risk away from a portion of your assets is typically prudent at or near retirement age, and with interest rates where they are on deposit accounts, you lose by standing still vice inflation if you go with CDs or MMs. That makes annuities an attractive option for beating inflation without risking principle loss, and you still get 10% annual liquidity without penalty. Heck, I have a 36m fixed annuity paying double what you can get in the bank for the same 36m commitment on a CD.
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17-10-2017, 11:34 AM
RE: Alt right protests
(17-10-2017 11:25 AM)Stefan Mayerschoff Wrote:  
(17-10-2017 11:19 AM)GirlyMan Wrote:  Why would I ever take my money out of the TSP? I mean that as a serious question. Why would I?

There a few reasons to consider. Diversification beyond the 5 fund options in the TSP is primary.

5 ETFs seem plenty to me and the L-funds have professional money managers balancing it daily.

(17-10-2017 11:25 AM)Stefan Mayerschoff Wrote:  You could be looking for local management and easier access to your funds.

That to me would be the primary reason, but I think they're trying to fix that somewhat.


(17-10-2017 11:25 AM)Stefan Mayerschoff Wrote:  ... or creates a tax free multiple benefit to your beneficiaries.

How can I do that? The money was tax deferred not tax exempt. The Man's gonna want his take whether I'm alive or dead isn't he?

(17-10-2017 11:25 AM)Stefan Mayerschoff Wrote:  TSP is very low cost plan, but also rather limited in its sophistication.

I was looking at firms like Fisher Investments but they want 1.5% off the top just to move it in and 1.5% every year thereafter. TSP is like 0.25%.

#sigh
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17-10-2017, 11:39 AM (This post was last modified: 17-10-2017 11:44 AM by Stefan Mayerschoff.)
RE: Alt right protests
(17-10-2017 11:34 AM)GirlyMan Wrote:  
(17-10-2017 11:25 AM)Stefan Mayerschoff Wrote:  There a few reasons to consider. Diversification beyond the 5 fund options in the TSP is primary.

5 ETFs seem plenty to me and the L-funds have professional money managers balancing it daily.

(17-10-2017 11:25 AM)Stefan Mayerschoff Wrote:  You could be looking for local management and easier access to your funds.

That to me would be the primary reason, but I think they're trying to fix that somewhat.


(17-10-2017 11:25 AM)Stefan Mayerschoff Wrote:  ... or creates a tax free multiple benefit to your beneficiaries.

How can I do that? The money was tax deferred not tax exempt. The Man's gonna want his take whether I'm alive or dead isn't he?

(17-10-2017 11:25 AM)Stefan Mayerschoff Wrote:  TSP is very low cost plan, but also rather limited in its sophistication.

I was looking at firms like Fisher Investments but they want 1.5% off the top just to move it in and 1.5% every year thereafter. TSP is like 0.25%.

Bit high on the fee. I charge 1.25% annually for professional management. For that, you get a highly diversified portfolio of between 22 and 28 funds based on your risk tolerance, tactical and strategic management, and no additional transaction costs. As I mentioned though, I wouldn't keep 100% of your TSP money in the market unless you are very comfortable with risk. So the biggest reason would be protection - and most fixed or fixed indexed annuities cost 0% to buy and maintain.

Thumbsup

ETA - sorry ignore the tax free multiple thing - you are 100% correct. Had a brain fart and forgot you can't buy single premium insurance with qualified funds. My bad. I do that a lot with NQ funds that my clients don't need during their lifetimes and just want to leave to their beneficiaries.

Got a little excited heh.
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17-10-2017, 11:50 AM
RE: Alt right protests
Stefan = super smart Bowing Respect.
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17-10-2017, 12:34 PM
RE: Alt right protests
(17-10-2017 11:50 AM)adey67 Wrote:  Stefan = super smart Bowing Respect.

Blush

You're too kind Adey!

And maybe just a bit hasty in your conclusions Laugh out load
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