|
Low risk investment advice
05-18-2020, 02:39 PM
|
#1
|
Thinks s/he gets paid by the post
Join Date: Jul 2008
Location: Weatherford, Texas
Posts: 1,213
|
Low risk investment advice
I am self directed and have two large corporate bond funds I am considering exchanging for something with less risk. I am considering the ETF "SHY"..Is there anything else that safe that pays more? Thanks
__________________
Life is good. Then you die.
|
|
|
|
Join the #1 Early Retirement and Financial Independence Forum Today - It's Totally Free!
Are you planning to be financially independent as early as possible so you can live life on your own terms? Discuss successful investing strategies, asset allocation models, tax strategies and other related topics in our online forum community. Our members range from young folks just starting their journey to financial independence, military retirees and even multimillionaires. No matter where you fit in you'll find that Early-Retirement.org is a great community to join. Best of all it's totally FREE!
You are currently viewing our boards as a guest so you have limited access to our community. Please take the time to register and you will gain a lot of great new features including; the ability to participate in discussions, network with our members, see fewer ads, upload photographs, create a retirement blog, send private messages and so much, much more!
|
05-18-2020, 03:21 PM
|
#2
|
Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Nov 2010
Location: Sarasota, FL & Vermont
Posts: 36,376
|
I just opened a Capital One online savings account that pays 1.5% and is FDIC insured and no interest rate risk. The cherry on top is a 1% bonus ($100 for each $10,000 up to $50,000) so if the 1.5% rate holds then my yield for a year will be 2.5%.
__________________
If something cannot endure laughter.... it cannot endure.
Patience is the art of concealing your impatience.
Slow and steady wins the race.
Retired Jan 2012 at age 56
|
|
|
05-18-2020, 03:35 PM
|
#3
|
Thinks s/he gets paid by the post
Join Date: Jul 2008
Location: Weatherford, Texas
Posts: 1,213
|
That sounds like a pretty good deal
__________________
Life is good. Then you die.
|
|
|
05-18-2020, 03:40 PM
|
#4
|
Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Mar 2003
Posts: 18,085
|
I hold two merger arbitrage funds as a low risk fixed income alternative, namely merfx and arbfx.
__________________
"All animals are equal, but some animals are more equal than others."
- George Orwell
Ezekiel 23:20
|
|
|
05-18-2020, 03:41 PM
|
#5
|
Recycles dryer sheets
Join Date: Jun 2010
Location: Southwest Florida
Posts: 470
|
You are exchanging corporates for US Treasuries and it doesn't get any safer than that. However, are you sure you want to take such an extreme position? Except for TIPS and I-Bonds, my entire fixed income portfolio is corporates and I'm quite comfortable with that.
Gill
|
|
|
05-18-2020, 04:01 PM
|
#6
|
Thinks s/he gets paid by the post
Join Date: Jul 2008
Location: Weatherford, Texas
Posts: 1,213
|
Quote:
Originally Posted by Gill
You are exchanging corporates for US Treasuries and it doesn't get any safer than that. However, are you sure you want to take such an extreme position? Except for TIPS and I-Bonds, my entire fixed income portfolio is corporates and I'm quite comfortable with that.
Gill
|
I too have I-Bonds that have done well the past 20 years..I have the aggressive part of my portfolio in equities that I don't ever plan to sell unless I lost my pensions and S.S... I fear the default risk of my bond mutual funds even though it is Vanguard corporate investment grade fund..The other bond fund is higher risk but only holds about 10% junk.. I want to be reasonably sure I can maintain my lifestyle in the event of real financial economic catastrophe..
__________________
Life is good. Then you die.
|
|
|
05-18-2020, 04:22 PM
|
#7
|
Thinks s/he gets paid by the post
Join Date: Jul 2008
Location: Weatherford, Texas
Posts: 1,213
|
On a side note I also need to get my taxable income down to avoid higher Medicare premiums..What is safe fund or ETF that is federally tax exempt?
__________________
Life is good. Then you die.
|
|
|
Avoiding medicare penalty
05-20-2020, 11:14 AM
|
#8
|
Recycles dryer sheets
Join Date: Nov 2011
Location: Beaver island, MI and St. Augustine, FL
Posts: 90
|
Avoiding medicare penalty
i'm pretty sure that you can't avoid Medicare penalty by using tax exempt bonds. Remember to count only 85% of SS income. If still close to Medicare penalty income level then why not consider an intermediate term treasury bond account: low .rate of return but very good during recessions
|
|
|
05-20-2020, 11:26 AM
|
#9
|
Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Mar 2017
Location: City
Posts: 10,351
|
Quote:
Originally Posted by lawman
... I want to be reasonably sure I can maintain my lifestyle in the event of real financial economic catastrophe..
|
IMO TIPS are the low-risk option, especially for money that will stay invested long term. You can't get that kind of inflation catastrophe protection anywhere else. Yields are a little hard to estimate because the YTM calculation is simply a lower bound, effectively assuming zero inflation. But with any reasonable inflation estimate added to the coupon rate the yield is not terrible.
|
|
|
05-20-2020, 11:40 AM
|
#10
|
Thinks s/he gets paid by the post
Join Date: Jul 2008
Location: Weatherford, Texas
Posts: 1,213
|
Quote:
Originally Posted by OldShooter
IMO TIPS are the low-risk option, especially for money that will stay invested long term. You can't get that kind of inflation catastrophe protection anywhere else. Yields are a little hard to estimate because the YTM calculation is simply a lower bound, effectively assuming zero inflation. But with any reasonable inflation estimate added to the coupon rate the yield is not terrible.
|
I love my I-Bonds..I wish I had bought more 20 years ago..
__________________
Life is good. Then you die.
|
|
|
05-20-2020, 11:57 AM
|
#11
|
Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Mar 2017
Location: City
Posts: 10,351
|
Quote:
Originally Posted by lawman
I love my I-Bonds..I wish I had bought more 20 years ago..
|
Yes. I have never done I-bonds because the annual purchase limit is so low. We just buy TIPS directly, not a TIPS mutual fund. There is not much of a yield curve, so we don't even ladder. Since 2004 we have held basically one issue, the 2s of 2026. A year or so ago I bought some that mature in 2021. Those $$s are part of the psychological bucket that we will be spending as necessary until the equity market settles down. On that shorter issue I may have done better with treasury notes but I didn't check. From many posts here it's clear that chasing basis points makes a really enjoyable and absorbing hobby, but I'm just not into it.
|
|
|
05-20-2020, 03:59 PM
|
#12
|
Dryer sheet aficionado
Join Date: Apr 2007
Posts: 32
|
Tax free bond income counts for Medicare premiums- not like for Federal income tax.
|
|
|
05-20-2020, 04:21 PM
|
#13
|
Thinks s/he gets paid by the post
Join Date: Jul 2008
Location: Weatherford, Texas
Posts: 1,213
|
Quote:
Originally Posted by joeprintz
Tax free bond income counts for Medicare premiums- not like for Federal income tax.
|
Thanks...Did not know that
__________________
Life is good. Then you die.
|
|
|
05-20-2020, 07:52 PM
|
#14
|
Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Nov 2010
Location: Sarasota, FL & Vermont
Posts: 36,376
|
Quote:
Originally Posted by lawman
On a side note I also need to get my taxable income down to avoid higher Medicare premiums..What is safe fund or ETF that is federally tax exempt?
|
As other have mentioned, muni-income is added back in. Income from a MYGA (deferred annuity... similar to a CD by issued by an insurer but not FDIC insured) wouldn't count until withdrawn or annuitized, but that is arguably just kicking the IRMAA can down the road.
__________________
If something cannot endure laughter.... it cannot endure.
Patience is the art of concealing your impatience.
Slow and steady wins the race.
Retired Jan 2012 at age 56
|
|
|
05-20-2020, 08:09 PM
|
#15
|
Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Mar 2016
Posts: 8,968
|
Quote:
Originally Posted by lawman
On a side note I also need to get my taxable income down to avoid higher Medicare premiums..What is safe fund or ETF that is federally tax exempt?
|
Really? First level IRMMA with Rx kicker is a whole $800 a year.
|
|
|
05-20-2020, 08:15 PM
|
#16
|
Thinks s/he gets paid by the post
Join Date: Jul 2008
Location: Weatherford, Texas
Posts: 1,213
|
Quote:
Originally Posted by RobbieB
Really? First level IRMMA with Rx kicker is a whole $800 a year.
|
I thought it was about $2600.00 each
__________________
Life is good. Then you die.
|
|
|
|
Currently Active Users Viewing This Thread: 1 (0 members and 1 guests)
|
|
Posting Rules
|
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts
HTML code is Off
|
|
|
|
» Recent Threads
|
|
|
|
|
|
|
|
|
|
|
|
|
» Quick Links
|
|
|