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31

Taxes / Re: Estimating Roth Conversions - How close to get?

« Last post by SeattleCPA on Today at 03:27:21 PM »

Specifically on the top tier IRMAA adjustment number, since that's one that I specifically wonder about:  I am compounding $384.30 + $74.2 = $458.50 per month for IRMAA Part B and Part D at 7.7% annually for 40 years which gives me a result of $8,911.84 per month.  I'd appreciate anyone checking my math.  Again, my understanding is that the IRMAA brackets are adjusted by CPI or similar, but IRMAA premiums are adjusted by Medicare costs.

So first know (or hear again) that I have a ton of respect for your tax skills and financial analytical skills. You've displayed those a ton over the years. Or longer. :-)

But to address the issue of adjusting the IRMAA bump for inflation--and I don't have your spreadsheet's formulas--but it seems like you'd want to check your inflation adjustments on the tax brackets too. I.e., at some point, if one assumes that medical costs just continue to increase at a rate two or three times the general inflation rate, it seems like they become such a big component of everybody's spending that the overall inflation rate should be adjusted by a way higher number too. I.e., that medicare inflation and general price level information should converge. Practically, not sure how you address that in a spreadsheet. But it seems like you need to model either a lower IRMAA "inflation rate" or a higher tax-bracket "inflation rate."

FWIW I do think (and this is another tricky issue) that it makes sense to assume the current tax laws apply. Mostly because it's so hard to predict what'll happen. And that means assuming the current rates expire in 2026 and return to the pre-2018 rates... but with inflation adjustments so all of those amounts move steadily higher.

I won't keep drawing out my commenting in this thread, but I think I think Roth-style accounts work more poorly than many here do because:
1. I'm assuming low-ish real rates of return going forward. E.g., like Vanguard's forecasts.
2. I think one has other good ways to avoid RMD troubles. (Tax efficient taxable accounts work really well for some people.)
3. I worry more about other things (sequence of returns risk) than I do about RMDs or paying IRMAAs.

32

Ask a Mustachian / Re: How do you know how much car?

« Last post by Sibley on Today at 03:15:26 PM »

Well first, there's an argument to be made that you shouldn't be paying off the mortgage. I'm not paying mine off beyond required payments because I can earn more money on just about anything else.

You need a vehicle, and one that the door is going to fall off while you're driving is not ok. I do not want your door to hit me! So, you find a vehicle that fits your needs, you can afford, and just accept that this is the reality of needing a vehicle. A $35k vehicle doesn't seem terribly unreasonable to me, though I have no idea what your used car market is like.

And remember, if you pay cash for a vehicle that means you didn't add to the debt.

33

Welcome and General Discussion / Re: I think I want to be a stay at home dad

« Last post by Tass on Today at 03:11:50 PM »

Have you considered how your taxes will change? You will likely be keeping much more of your wife's income if you quit working (assuming MFJ).

Looks like, before considering tax changes, you expect quitting to save you $43k. Would you do your current job for a salary of $42k? ($85k salary - $43k work-related expenses = $42k actual pay.)

I can't comment on the social aspects as I don't have kids yet, but my partner being a SAHD is one possibility for us too. Interested to follow.

34

Welcome and General Discussion / Re: $10m dollars--more than enough?

« Last post by Morning Glory on Today at 03:00:25 PM »

If I won, I'd call Trump and ask if he wanted to borrow money, then come up with increasingly humiliating conditions, then tell him to f off.

Now here's a billionaire dream, that doesn't cost you anything in the end.  Brilliant!

He has better odds of being struck by lightning :)

35

Ask a Mustachian / Re: GRRRRR! Where can I get free clip art?

« Last post by Tass on Today at 02:56:45 PM »

Here's another one if you're determined to show a row of books (stacks seem to be more common in clipart): https://openclipart.org/detail/314007/vintage-bookshelf-by-revzack-cleaned-up

I like this one, too! Same question.

There are download buttons to the right on the webpage. Unless you're going to edit the image (when having the SVG format would be useful), I would select the "Large" PNG for downloading.

36

Welcome and General Discussion / I think I want to be a stay at home dad

« Last post by poetdereves on Today at 02:56:14 PM »

DW and I have considered me being a SAHD starting in 2025. Current income and expenses:

CURRENT INCOME:
DW: $159k
DH: $85k
Rentals: $9k
Total: $~250k

CURRENT EXPENSES (past 12 months averaged):
$129k

2025 INCOME:
DW: $159k
Rentals: $9k
Total: ~$170k

2025 EXPENSES:
$86k

I can break this down more into a case study if people want to see, but I am not necessarily looking to have the budget combed through for places to decrease expenses. I am open to it, but it isn’t necessary to keep the option to stay home available.

The biggest changes financially will be losing my income (~$80k), but we would stop paying our in-home nanny ($400/wk) and a few other things that we hire out that I would do myself. We’d also lose the ability to contribute to my 401k at work, which I currently max out. We will still have enough income to continue saving quite a bit, so I am wondering what other options are out there for tax advantaged investing.

I currently have DS (2 years old) a couple days a week while my wife works (from home). We are having our DD in October. We have our nanny three days a week. I do have a lot of extracurriculars that I participate in and include my son in that I would like to keep doing for my own sanity.

Any other SAHDs out there that have some good-to-know info?
Any things that you wish you’d have known about being a SAHD or being married to one?
Anyone gone back to work after 3-5 years, or did it become permanent for you?
What kind of issues have you had socially as a SAHD?

37

Ask a Mustachian / Re: GRRRRR! Where can I get free clip art?

« Last post by Dicey on Today at 02:40:46 PM »

Alternate line of thought, sometimes decorative fonts/wingdings can work in a pinch, too. To that end, DaFont is useful, and you can restrict browsing to public domain/open source licensing when browsing under "more options".

In your case, I found the following font Book Ends that might be perfect for your use case, but it's marked as free for personal use only. I checked her website and the licensing terms, but there's no elaboration on where NPO/501(c)(3) or your usage case falls in that spectrum between personal and commercial. That said, she has a contact form, and it never hurts to ask if you like the font and what it does, and given the lack of broader definitions of personal and commercial in her licensing. That said, the commercial desktop license is $5, which isn't free, but not expensive for a tool you could probably reuse.

I like this! I checked her page, and it seems within bounds, but I asked for permission, just in case. Next question: How the fuck do I download and use it?

Here's another one if you're determined to show a row of books (stacks seem to be more common in clipart): https://openclipart.org/detail/314007/vintage-bookshelf-by-revzack-cleaned-up

I like this one, too! Same question.

Though I may have a shitload of posts here, I'm not actually all that computer literate, so thanks in advance. I do know what RFMS means, though ;-)

As to determined, you bet I am. Here's why I need this:

At this fundraiser, the fundraising is done downstairs, then everyone proceeds to go upstairs for dinner with the author of their choice. It has always bugged me that we stop asking for money at this point. Every fundraiser I've ever attended keeps asking, even on the way out the door.

I had the idea to strew pictures of "Banned" books of different denomination across the tabletops. (I'm in charge of centerpieces, so it's part of the decor, m'kay?) Each guest will have a old-school book pocket at their place. They can choose which books they'd like to "buy" and the envelopes will be collected at the end of dinner. The book pocket will have instructions printed on it and I want some kind of book motif in the very small space at the bottom. I like Daley's suggestion, because if I can figure how the hell to do it, the books will spell "Thank you."

It has been an uphill battle to get the Board to agree to this, so I HAVE to make it look good, with no budget and minimal skillz. Wish me luck!

Sorry if that's TMI.

P.S. Thanks for being so responsive. You guys rock!

38

Ask a Mustachian / How do you know how much car?

« Last post by ilikemusubi on Today at 02:39:57 PM »

So my partner and I are currently saving for a new vehicle.
Our 1997 Jeep's doors are literally falling off (driver's side to be exact) and we are funneling more money into than we should.

While we both ride our bikes during the summer months, we live in Wyoming and bike riding all-year round is not possible due to a variety of factors.

We are looking at a Tacoma. They tend to last a long time with proper maintenance and offer us the 4x4 capability we need during the winter to get to work.

The biggest question we keep asking ourselves is: how much is the right answer? 4 year old Tacoma's are 35K where we live. At that point, I see us just making a lump sum payment against our mortgage principal instead of buying the car, even though we need the car. For $15k, we can get a 10-12 year old Tacoma with 1xx,xxx miles. At that point, we wouldn't feel bad about not paying off more mortgage principal, but then we run the risk of getting a vehicle that wont last as long.

For our financials, we have no debt but our mortgage, which is $332k.

How did you navigate buying a vehicle and comparing it to paying off debt?

39

Ask a Mustachian / How do you know how much car?

« Last post by ilikemusubi on Today at 02:38:54 PM »

So my partner and I are currently saving for a new vehicle.
Our 1997 Jeep's doors are literally falling off (driver's side to be exact) and we are funneling more money into than we should.

While we both ride our bikes during the summer months, we live in Wyoming and bike riding all-year round is not possible due to a variety of factors.

We are looking at a Tacoma. They tend to last a long time with proper maintenance and offer us the 4x4 capability we need during the winter to get to work.

The biggest question we keep asking ourselves is: how much is the right answer? 4 year old Tacoma's are 35K where we live. At that point, I see us just making a lump sum payment against our mortgage principal instead of buying the car, even though we need the car. For $15k, we can get a 10-12 year old Tacoma with 1xx,xxx miles. At that point, we wouldn't feel bad about not paying off more mortgage principal, but then we run the risk of getting a vehicle that wont last as long.

For our financials, we have no debt but our mortgage, which is $332k.

How did you navigate buying a vehicle and comparing it to paying off debt?

40

Off Topic / Re: Life dilemma here. [hobby as a job?]

« Last post by ATtiny85 on Today at 02:15:21 PM »

@Polket 10 years later, how did this work out?

You are asking for an update, from someone who hasn't been on here in 10 years, to a thread in a forum they can't even post in? I guess we wait and see.