<p>How old are you?</p>
<p>I used 3% for inflation and 6% for rate of return. I think itās best to be conservative.
Regarding the stock market, Iām glad I closed out on all of my multiple PE stocks. I have my husband to thank for. He spends more time at home and listens to cnbc more often.</p>
<p>@dstark, this comes from <a href=āA Look Inside Vanguardās International Bond Funds ā Oblivious Investorā>http://www.obliviousinvestor.com/a-look-inside-vanguards-international-bond-funds/</a></p>
<p>EDIT: just realized this is old data. I will look it up later on Vanguard proper; I think the only difference is the SEC Yield (which I think is. Ow 1.25%). Taking wife on errands, so will post later.
The expense ratio is somewhat higher than Iād like, but Iām spoiled :-)</p>
<p>Expense ratio: 0.20% for Admiral shares (with a $10,000 minimum), 0.23% for Investor shares.</p>
<p>Average duration: 6.7 years, meaning this fund should be slightly more volatile than Vanguardās Total Bond Market Index Fund (with its average duration of 5.5 years).</p>
<p>SEC yield: 1.66%, which is slightly lower than the current SEC yield of 2.00% on Vanguard Total Bond Market Index Fund.</p>
<p>Credit risk: Slightly higher than Vanguardās Total Bond Market Index Fund, with the largest part of its holdings being AA-rated bonds rather than U.S. Treasury bonds.</p>
<p>Currency risk and inflation risk: Because the fund will be currency-hedged, currency risk should be minimal, and inflation risk should be comparable to that of any dollar-denominated nominal intermediate-term bond fund.</p>
<p>IxnayBob, </p>
<p>Soā¦the yield is 1.66% and my inflation rate is 3%. I am locking in a loss unless I go for short term cap gains which is risky. </p>
<p>The duration does keep interest rate risk down a bit which is good. </p>
<p>The Vanguard total bond market index fund has a better yield and the duration is shorter. Still locking in a loss.</p>
<p>Of course, cash is a loser.</p>
<p>Lots of losersā¦which should I pick? I am kind of joking and kind of not joking. Tough times for fixed income
investors.</p>
<p>When the djia was down over 100 points todayā¦I was thinkingā¦why dont I just buy an apartment? :)</p>
<p>DrGoogle, that 6 percent is a before tax or after tax return?</p>
<p>Do you own any bonds?</p>
<p>IxnayBob, 1.25%? :). Have fun.</p>
<p>I used it on your calculator, I assume itās before tax because it has the tax input somewhere in that calculator.
I have straight cash, no bonds. A few years back I had purchased bonds from Ford directly and got 5% interest rate but it expired after so many years. If I were to buy bonds it has to be directly like that, no bond mutual funds. </p>
<p>Yeahā¦</p>
<p>Editā¦I have to look again but I think that is after taxā¦</p>
<p>I didnt see anything about deducting taxes in that calculator.</p>
<p>I buy individual bonds except for one fundā¦</p>
<p>There is a tax bracket input, why would it ask for it?</p>
<p>I forgot. You are right. I just do the taxes myself, reducing my return, and leave that box at zero.</p>
<p>@thumper1 I just got back from HS reunion, and friend who is a teacher in IL for 34 years and will continue to work probably until 65+, also does not pay into SS. She will probably get a minimal amount like you did for having enough little jobs before with paying into SS. Her pension situation concerns me, but hopefully things will be OK - she is divorced after 22 years (sounds like H hid a lot from her and maybe personality disorder), has two kids 13 and 15. Ex sounds pretty bad - one daughter upset because ex wouldnāt let dog go back and forth with kids. Her parents are still alive, but who knows if they will need care and drain down assets.</p>
<p>Tks for all who shared links on discussions/articles etc. Our LTC insurance policies give us peace of mind. If I get the job I interviewed for, we will build up assets very well over next 10 years. H lost a pension plan when his company was sold, so asset build up will help for that loss.</p>
<p>Iām not sure this is the case everywhere but teachers in MA cannot collect SS even a little. We cannot collect our spouseās either if he or she dies.</p>
<p>Most of texas teachers are in similar circumstances. I am lucky (or unlucky, depending on your perspective) in that my old school district is one of the few where teachers pay into both Texas Teacherās Retirement System and Social Security. I will collect both. Some might have preferred to not participate in SS, and have more money up front, but I am glad that I was not given the option to participate or not.</p>
<p>When will you have the āmoney talkā with your kids? There have been threads on whether your college-age kids know what your income and assets are, but this is a different topic. Once you are retired and living on whatever pensions/SS/savings/annuities you have, when will you put together a list of all your financial assets and let your kids know what you are living on and what to do if you and/or your spouse become unable to manage your affairs?</p>
<p>When will you add your kids to your checking account so they can act on your behalf in an emergency? When will you give them DPOA on all your accounts. </p>
<p>If you follow the Parents Caring for Parents thread, or if you have or had elderly parents, you know this is a big issue. Most of our parents never planned to need to rely on us, and just put off āthe conversationā as long as possible, maybe forever. I donāt want to make the same mistake, and it seems like the best way to avoid it is to set a date for the show and tell. Our kids eyes would glaze over if we tried to go over this with them now, but Iām thinking my 70th birthday, when I start collecting SS, is the time. We have wills and trusts and a folder in the file cabinet, but on my 70th weāll make them pay attention to it, or at least try.</p>
<p>There is an offset provision for teachers in states where they donāt contribute to SS. The SS benefit is reduced using some formula and the pension amount received. My SS was reduced by 2/3ā¦to that rousing $166 a month. I also can never collect on my husbandās earnings recordā¦ever.</p>
<p>SOSā¦why are you concerned about your friend in Illinois? Is it because she hasnāt worked long enough for a teacherās pension that will support her? I sure hope she addressed her retirement future during her divorce. </p>
<p>My only issue is the reduction I have. I mean reallyā¦I did contribute to SS for a number of years. And Iām not allowed to collect my. $460 a month because I collect a pension from a state where teachers do not contribute to SS. I just think I should be able to collect full SS based on what I contributed. What does that have to do with my state not collecting SS from teachers?</p>
<p>momofJ&L- My kids will be too young for this at 70, maybe 80? DPOA- maybe when one of us is not competant then there is only one left. My father did this at 85 when he had a terminal illness for him and my mother.</p>
<p>Thumper, I donāt think it is on a state by state basisā¦ it depends if you paid into SS. I remember that when my MIL retired, she was able to work just one day for a school district that paid into SS and then she got to receive benefits. The IRS got rid of that loophole after they saw how many folks were taking advantage of it.</p>
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<p>You could if your pension was small enough. If you taught for perhaps 9 years, you might not have reduced your spousal benefit to zero . I have run the numbers.</p>
<p>I am curious about the teacherās pension issue. I always thought that teachers got a very good pension, but I assumed that they got social security also. Plus it sounds like they have to contribute a percentage to their pension. Has anyone run the numbers, as far as----if they were not a teacher, and were getting the same salary in another job, how would it compare? If they got social security instead of a pension, and instead of contributing to the pension system, they put that money into their own personal account. Does what Iām asking make any sense?! </p>
<p>I think most of us would do better taking our social security contributions over our lifetimes and putting that money into our own investments-especially the self employed and couples where both people work. Just look at how the contribution percentage doesnāt change up to the limit but the payment from Social security barely increases over a certain amount. Add to that the reality that certain people and their descendants never collect a penny of their social security. The system is designed to collect a lot of money from working people and support a large percentage of the population not to necessarily pay what your fair share is necessarily. Most of us are not given the choice. Many government workers including teachers donāt have to be in the SS system and this alone is a huge benefit.</p>