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Other / Re: Investing in NTD as a Taiwanese
« Last post by KatieDarwin on April 21, 2021, 04:25:16 AM »That is, investments in the dollar depend solely on the country?
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2
Taxes / Re: Better understanding of capital gains harvesting?
« Last post by gocurrycracker on April 09, 2021, 09:28:30 PM »1. Are only the GAINS on taxed by the state, or as in this example - would the full $77k be taxed by the state?
2. With the ACA subsidies, is the $77k what's measured or only the gains?
Only the gains are taxed.
Same with ACA.
Imagine if that weren't the case - you have $100k in cash and you buy stock and then immediately sell for the same price.
e.g. Buy $100k of VTI at $200. Sell $100k of VTI at $200. You now have $100k in cash, again.
Do you have a gain of zero (and thus no tax) or are you taxed on $100k?
Definitely the former.
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Other / Re: Investing in NTD as a Taiwanese
« Last post by gocurrycracker on April 09, 2021, 09:27:22 PM »What is the logic for investing in USD?
The index philosophy says (generally) that Taiwan is roughly 2% of total world stock market valuation, and therefore you should have about 2% of your portfolio invested in Taiwan. If you are a Taiwan citizen/long-term resident you could have some (reasonable) home bias.
There are global ETFs that you can purchase in Taiwan in NTD - I don't know anything about them.
You can also hedge against the currency (hold assets in something other than NTD and/or invest in vehicles that track a different currency)
The index philosophy says (generally) that Taiwan is roughly 2% of total world stock market valuation, and therefore you should have about 2% of your portfolio invested in Taiwan. If you are a Taiwan citizen/long-term resident you could have some (reasonable) home bias.
There are global ETFs that you can purchase in Taiwan in NTD - I don't know anything about them.
You can also hedge against the currency (hold assets in something other than NTD and/or invest in vehicles that track a different currency)
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Taxes / Re: Better understanding of capital gains harvesting?
« Last post by Kate on April 09, 2021, 09:08:01 PM »Clarifying this because I live in Oregon (currently HoH but will be Single in maybe 5-6 years when teen ages up) and I'm struggling with this a bit!
1. Are only the GAINS on taxed by the state, or as in this example - would the full $77k be taxed by the state?
2. With the ACA subsidies, is the $77k what's measured or only the gains?
Quote
"This is GAINS. If your investment has doubled since you bought it, you could sell $77,200 worth... half is gain, half is basis.
These transactions will be taxed by your State, if applicable. They will also impact ACA subsidies, if applicable. "
1. Are only the GAINS on taxed by the state, or as in this example - would the full $77k be taxed by the state?
2. With the ACA subsidies, is the $77k what's measured or only the gains?
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Other / Investing in NTD as a Taiwanese
« Last post by August on April 08, 2021, 08:16:13 AM »I have seen the logic for investing in dollars. That being said, if the bulk of your income is in NTD, there are costs to switching over. Is there any Taiwanese equivalent for investing to the index fund/VTI philosophy, but in NTD? Or would the recommendation still be to change over to USD? Thanks.
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Early Retirement / Re: Can I retire? I'm so tired of this job/HCOL area!
« Last post by gocurrycracker on March 24, 2021, 08:27:47 PM »I have some thinking to do....
Please keep us updated! Best of luck!
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Early Retirement / Re: Looking for guidance
« Last post by gocurrycracker on March 24, 2021, 02:44:48 AM »Yup - don't know when your going to die. I suppose that would take all the fun out of it...
If you like the look of San Miguel de Allende but prefer fewer expats, try Guanajuato (college town), Querétaro (bigger city, has a Costco), or Dolores Hidalgo (small number of expats, nice Mexico feel.) SMA has always had a large expat population which does help expand the number and variety of restaurants, and if you prefer to see zero Canadians or Americans you can do that too just by locating yourself 10 minutes outside the city center.
For Roth conversions - yes, they can save you money. The question is how much. They have the biggest advantage when there is a substantial marginal rate delta, say you avoid paying tax at 35% by paying 12% today. Those big deltas mostly occur for people with lots of $ in their IRA.
See this financial review where I calculated the tax savings for doing a lot of Roth conversion, which could save up to $1.5 million in taxes for the Bobs. That seems like a lot.
https://www.gocurrycracker.com/reader-financial-review-scared-death-early-retirement/
But when you look at the NPV of those tax savings it amounts to something around $60k. Maybe that is also a big number, but it is only a few percent of their total portfolio value.
AND... you only pay big taxes later if you have large RMDs. And you only have large RMDs if your portfolio is large. Which happens only if you have a sustained period of strong growth post retirement.... or in other words, you are already at the stage in life where you know you have more money than you can spend.
So yes, do Roth conversions. But maybe don't make them more important than living where you want, when you want, how you want. Get the cake first, and then if you like sprinkle some Roth conversion frosting on top.
If you like the look of San Miguel de Allende but prefer fewer expats, try Guanajuato (college town), Querétaro (bigger city, has a Costco), or Dolores Hidalgo (small number of expats, nice Mexico feel.) SMA has always had a large expat population which does help expand the number and variety of restaurants, and if you prefer to see zero Canadians or Americans you can do that too just by locating yourself 10 minutes outside the city center.
For Roth conversions - yes, they can save you money. The question is how much. They have the biggest advantage when there is a substantial marginal rate delta, say you avoid paying tax at 35% by paying 12% today. Those big deltas mostly occur for people with lots of $ in their IRA.
See this financial review where I calculated the tax savings for doing a lot of Roth conversion, which could save up to $1.5 million in taxes for the Bobs. That seems like a lot.
https://www.gocurrycracker.com/reader-financial-review-scared-death-early-retirement/
But when you look at the NPV of those tax savings it amounts to something around $60k. Maybe that is also a big number, but it is only a few percent of their total portfolio value.
AND... you only pay big taxes later if you have large RMDs. And you only have large RMDs if your portfolio is large. Which happens only if you have a sustained period of strong growth post retirement.... or in other words, you are already at the stage in life where you know you have more money than you can spend.
So yes, do Roth conversions. But maybe don't make them more important than living where you want, when you want, how you want. Get the cake first, and then if you like sprinkle some Roth conversion frosting on top.
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Early Retirement / Re: Looking for guidance
« Last post by almost_there on March 23, 2021, 07:54:35 AM »You're right about inflation outside the U.S. Point well taken.
The challenge with delaying SS is... you don't know when you'll die. Actuarial assumptions are age 92, I believe. I like your thinking though: delay on a good market, take it early on a down market. In other words, treat as a fixed income element of my portfolio.
re. Roth conversions: when I run my numbers on i-orp (a cfiresim companion) it recommends some pretty aggressive early conversions. Pay a bunch of taxes early and little to none later. Thoughts?
Agreed on Mexico. Not sure about health coverage: fly back home for serious conditions? BTW, I loved your place in San Miguel de Allende. I hear it's become overcrowded with expats... and I'm trying to steer clear of that.
Thanks again.
The challenge with delaying SS is... you don't know when you'll die. Actuarial assumptions are age 92, I believe. I like your thinking though: delay on a good market, take it early on a down market. In other words, treat as a fixed income element of my portfolio.
re. Roth conversions: when I run my numbers on i-orp (a cfiresim companion) it recommends some pretty aggressive early conversions. Pay a bunch of taxes early and little to none later. Thoughts?
Agreed on Mexico. Not sure about health coverage: fly back home for serious conditions? BTW, I loved your place in San Miguel de Allende. I hear it's become overcrowded with expats... and I'm trying to steer clear of that.
Thanks again.
9
Early Retirement / Re: Can I retire? I'm so tired of this job/HCOL area!
« Last post by El Gran_Jamon on March 23, 2021, 07:31:31 AM »I'll give what advice I can. I retired, walked away, whatever from a politically charged job in education. I'm out at 52. My pension when it comes will be 30k less or more than if I stayed to 55 or longer. Also gave up lifetime location specific medical care. Don't care. When I'm done, I'm done. I am different from others on this site tho. I believe and invested in rental real estate. I'm not a big stocks guy but recently learned a lot. Fun.To me, full cost medical is a year's rent increases.
Here's the thing, eave a bad job and free your mind. I did. I learned how to make even more money. Things I couldn't see in front of me because I had my nose to the grind stone. You sound like you're a person of some capacity if you can survive, climb to a position of some import in a rough and tumble high cost state. (Similar here, Los Angeles ) What makes you think you can't make a go of it in Podunk Tennessee if you wanted to work a bit there? Maybe a hybrid midel, some work, some not. When you free your mind you will be amazed at what you missed before.
I would caution you tho on quality of Healthcare in Tennessee vs NYC. Do your due diligence. As we get older, we get health problems in some cases never knew existing. A surgeon I had for such an issue cautioned me rather stridently not to have this or any complex medical problems in a rural area. Reason? Doctors, surgeons and specialists are competitive and flock to where they make the most money.
Here's the thing, eave a bad job and free your mind. I did. I learned how to make even more money. Things I couldn't see in front of me because I had my nose to the grind stone. You sound like you're a person of some capacity if you can survive, climb to a position of some import in a rough and tumble high cost state. (Similar here, Los Angeles ) What makes you think you can't make a go of it in Podunk Tennessee if you wanted to work a bit there? Maybe a hybrid midel, some work, some not. When you free your mind you will be amazed at what you missed before.
I would caution you tho on quality of Healthcare in Tennessee vs NYC. Do your due diligence. As we get older, we get health problems in some cases never knew existing. A surgeon I had for such an issue cautioned me rather stridently not to have this or any complex medical problems in a rural area. Reason? Doctors, surgeons and specialists are competitive and flock to where they make the most money.
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Early Retirement / Re: Can I retire? I'm so tired of this job/HCOL area!
« Last post by Que1999 on March 22, 2021, 04:36:33 PM »Thank you Jeremy, and ychuck for the perspective from the other side. It's greatly appreciated! I have some thinking to do.... I suspect I will suck up the next 4 years, and in the meantime take a vacation or two to the area to check it. Just need to put the job/location into the big picture of life I guess and realize it's not that bad... and look forward to 2025.
Thanks!
Thanks!