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Old 12-19-2016, 09:34 AM   #41
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Again, then why does the statement below appear on their website? Vanguard can't provide something like I-ORP? I well understand the uncertainties, so I wouldn't expect Vanguard to guarantee anything. They already have plenty of disclaimers like 'past performance is no guarantee of future results' and I'd be happy to sign a waiver if needed. They recommend funds, how is developing a straightforward distribution plan more risky for them?


https://investor.vanguard.com/financ...ncial-planning
If I am reading correctly that's about PAS. A service that you pay for, and sign an agreement written by Vanguard attorneys.

Sure Vanguard has developers and IT expertise, but developing an I-ORP is not the same as the knowledge Vanguard has on staff. I know you say no gaurentee is fine, from my time in the industry, that's not what Vanguard's attorneys would say!

Of course then you might have a piece of software telling you different answers than a human advisor. How would Vanguard answer those type of questions? Then if the software was "free" how might Vanguard justify the PAS offering?

From my time in the fund industry one of the biggest costs of maintaining software was the ever changing tax laws. There wasn't a choice, you had to provide the information to the IRS and the clients. I could imagine going to the CIO and suggest another high maintenance software project that takes revenue off the table!
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Old 12-19-2016, 09:59 AM   #42
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If I am reading correctly that's about PAS. A service that you pay for, and sign an agreement written by Vanguard attorneys....
That's how I see it also - not part of the free service.

On the Vanguard site the link Midpack gave:

https://investor.vanguard.com/financ...ncial-planning

and that page has a line/link:

Find out how you can benefit from low-cost advice

https://investor.vanguard.com/financ...ncial-planning


that shows:

Quote:
Keep more with our low financial advisor fee of only 0.30%

You'll get the benefit of a Vanguard advisor, a customized financial plan, ongoing investment advice, and more for an annual cost of 0.30% of your assets under management. That's less than one-third the industry average of 1.02%.*
Seems like a misunderstanding - maybe time to undo the rant?

I was also in the camp with others - how could they give a detailed tax plan for free, w/o a LOT of time and info understanding the entire situation. It is complex, and I bet with the PAS, you sign contracts to clarify all the limits.

-ERD50
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Old 12-19-2016, 10:06 AM   #43
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I did the I-orp thing once and it confused me; however IIRC it made recommendation that I convert almost all my sizable IRA which I simply won't do.
I-orp (its author Welch) has responded to this criticism nicely and made some changes to the calculator, and more importantly, to the notes that go with the calculator.
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Old 12-19-2016, 10:19 AM   #44
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The 15% bracket for a joint return tops out at $75,300 for 2016. But that is for 'taxable' income, which does not count the deduction and exemptions.

So, you do not subtract but add the Standard Deduction (unless your itemized deduction is higher) and Exemption to the 15% bracket. For 2016, a couple filing a joint return with no dependents will have a Standard Deduction of $12,600 and 2 personal exemptions of $4,050 x 2 = $8,100.

This means the top of the 15% bracket for joint filers is really at $75,300 + $12,600 + $8,100 = $96,000.

You then subtract out other incomes. The left-over is what you can convert for the 15% tax rate.
Thanks for correcting that, NW. As far as a rough estimate goes......that would get you in the right ballpark. The killer here is the deadline of 12/30/2016 rather than April 2017. I receive a lot of 1099 income which doesn't get mailed to me until late January -- tough to accurately estimate the total.

As usual, they didn't make it easy for us.
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Old 12-19-2016, 10:31 AM   #45
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One does not have to squeeze the last dollar out of this. If one gets within $1K to $2K of the mark, it's OK. I can log into my brokerage accounts to see what divvies the MFs pay late in December. Or I can guesstimate it.

Then, one click of the mouse and my transfer between the IRA and Roth at the same brokerage is done.

I think I am going to do it soon, lest I forget. Old age memory, you know?
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Old 12-19-2016, 10:42 AM   #46
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I couldn't do an accurate estimate of reportable income until the 1099's come in (or don't come , as the case may be). I suppose I could guesstimate it now, and then re-characterize.....but that would be a SWAG at best.
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Old 12-19-2016, 10:50 AM   #47
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My brokerage can show me a tally of the realized cap gain/loss YTD, plus all the stock dividends on the Web. The distributions of the MFs can vary wildly, but mine usually are through with paying out before Christmas. By logging into my accounts after Christmas, I can get an accurate number without the 1099.
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Old 12-19-2016, 11:07 AM   #48
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Originally Posted by ERD50 View Post
That's how I see it also - not part of the free service.

On the Vanguard site the link Midpack gave:

https://investor.vanguard.com/financ...ncial-planning

and that page has a line/link:

Find out how you can benefit from low-cost advice

https://investor.vanguard.com/financ...ncial-planning


that shows:



Seems like a misunderstanding - maybe time to undo the rant?

I was also in the camp with others - how could they give a detailed tax plan for free, w/o a LOT of time and info understanding the entire situation. It is complex, and I bet with the PAS, you sign contracts to clarify all the limits.

-ERD50
We attempted to deal with two different advisors at Vanguard they both worked within a very limited box and they will not get outside of it! For 0.30% they are going to rebalance your portfolio on a quarterly basis i.e. 0.075% each quarter. Also, they will make all changes overnight when you execute the advisory agreement; regardless of tax consequences etc. My wife and I ended up interviewing several independent CFPs and hired one to create a plan based upon our input and interviews. Also, the wife trusts him. Cost was reasonable, he can monitor the plan, but at this time we handle the transactions. Meet quarterly by phone to review and see if any changes are needed. If there is a tax related question based on a possible transaction we contact our CPA for tax advice. Everything is on an hourly basis and as needed.

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Old 12-19-2016, 11:09 AM   #49
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I couldn't do an accurate estimate of reportable income until the 1099's come in (or don't come , as the case may be). I suppose I could guesstimate it now, and then re-characterize.....but that would be a SWAG at best.
I think FiveDriver is talking about earned income from customers that is reported on a 1099, not divs/CGs from investment accounts shown on a 1099-(INT?).
FiveDriver--you really can't predict within a few K how much the 1099 will be? I suppose one problem would be a big payment that might occur 31 Dec or 2 Jan.
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Old 12-19-2016, 11:25 AM   #50
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For those on the fence about doing a 2016 Roth Conversion with 1) the unknown anticipated tax policy changes or 2) not having your 1099's, consider this.

You can do a 2016 Roth Conversion (must do before year end) and you can 1) wait and see what happens to policy and/or 2) collect your 1099's and do your taxes. Then you can Recharacterize (undo) all or part of the 2016 Conversion before Oct 2017.

It is what I did in for my 2015 Roth Conversion. I recharacterized the excess to be at the top of the 15% bracket.
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Old 12-19-2016, 11:52 AM   #51
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I think FiveDriver is talking about earned income from customers that is reported on a 1099, not divs/CGs from investment accounts shown on a 1099-(INT?).
FiveDriver--you really can't predict within a few K how much the 1099 will be? I suppose one problem would be a big payment that might occur 31 Dec or 2 Jan.
OK. It can be tough, although I would think the payor would let you know.

One time, I did work for a close friend, and he could not pay me. A couple of years later, I received a surprise deposit in my bank of a sum around $50K. I guess he wanted to surprise me. I thought his business was going under, but he apparently got some good contracts and thrived.

At the same time, I was doing great that year with other works. So, I was faced with, you guess it, AMT for that year! No IRA allowed, no Roth, not even a stingy $500 after-tax money into my children Coverdell accounts. And I am not even rich. The year earlier, I was living off my savings, and now I was paying mucho tax.
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Old 12-19-2016, 11:56 AM   #52
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Originally Posted by Midpack View Post
Again, then why does the statement below appear on their website? Vanguard can't provide something like I-ORP? I well understand the uncertainties, so I wouldn't expect Vanguard to guarantee anything. They already have plenty of disclaimers like 'past performance is no guarantee of future results' and I'd be happy to sign a waiver if needed. They recommend funds, how is developing a straightforward distribution plan more risky for them?


https://investor.vanguard.com/financ...ncial-planning

I will bite....

Because you failed to highlight the important part of that sentence.... put in the extra words and it has a different meaning...
when the time comes to withdraw money, such as for retirement, by developing a tax-smart distribution plan.

They are not saying when the time comes to start converting tIRA money to ROTH.... that is a huge leap from a withdrawal plan for retirement....
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Old 12-19-2016, 01:09 PM   #53
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You can do a 2016 Roth Conversion (must do before year end) and you can 1) wait and see what happens to policy and/or 2) collect your 1099's and do your taxes. Then you can Recharacterize (undo) all or part of the 2016 Conversion before Oct 2017.
Provided the recharacterization policy does not change as well, of course. I have not heard any plans to change it during 2017.
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Old 12-19-2016, 02:26 PM   #54
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I didn't read all of the posts in this thread, but, there is a division at Vanguard that handles these questions.

Call the Retail Retirement/Complex IRA Questions team at 800 205 6189.

They were helpful when I had questions about doing TIRA to ROTH conversions (when and why type stuff).

Good Luck
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Old 12-19-2016, 03:08 PM   #55
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Originally Posted by ERD50 View Post
That's how I see it also - not part of the free service.

On the Vanguard site the link Midpack gave:

https://investor.vanguard.com/financ...ncial-planning

and that page has a line/link:

Find out how you can benefit from low-cost advice

https://investor.vanguard.com/financ...ncial-planning


that shows:



Seems like a misunderstanding - maybe time to undo the rant?

I was also in the camp with others - how could they give a detailed tax plan for free, w/o a LOT of time and info understanding the entire situation. It is complex, and I bet with the PAS, you sign contracts to clarify all the limits.

-ERD50
Please show where I ever said I was looking for free.
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Old 12-19-2016, 04:07 PM   #56
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Originally Posted by Midpack View Post
Again, then why does the statement below appear on their website? Vanguard can't provide something like I-ORP? I well understand the uncertainties, so I wouldn't expect Vanguard to guarantee anything. They already have plenty of disclaimers like 'past performance is no guarantee of future results' and I'd be happy to sign a waiver if needed. They recommend funds, how is developing a straightforward distribution plan more risky for them?


https://investor.vanguard.com/financ...ncial-planning
Suggest this to Vanguard? Maybe they have such software? Just holding it for high-networth clients?

The link you supplied is part of this suite of pages. It is about the paid vanguard advisor service, I believe.
https://investor.vanguard.com/financ...ancial-planner
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Old 12-19-2016, 05:18 PM   #57
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Please show where I ever said I was looking for free.
Well, the word 'free' was scattered in your post, you made one parenthetical comment about previous free reviews that "(I would have paid a small fee for the exercise)"

And even though you are complaining about the service, you never said anything about not getting your money's worth or anything like that. So I was led to believe this was part of the free services from Vanguard.

Was I incorrect to think that? Are you signed up for the PAS, or other fee-based service from Vanguard? That would have been worth mentioning, I think.


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I will bite....

Because you failed to highlight the important part of that sentence.... put in the extra words and it has a different meaning...
when the time comes to withdraw money, such as for retirement, by developing a tax-smart distribution plan.

They are not saying when the time comes to start converting tIRA money to ROTH.... that is a huge leap from a withdrawal plan for retirement....
Good point - planning a distribution for the year is different from planning for future withdrawals across an entire remaining lifetime. Maybe that is all they meant?

-ERD50
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Old 12-20-2016, 05:18 PM   #58
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Well.... I logged on Vanguard today and guess what... they have a link to a page talking about ROTH conversion...


https://investor.vanguard.com/ira/ro...ady:Roth:SO:XX


Has a link for calculation even though I did not take a look at it....


SOOOO, seems they do 'do' it...
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Old 12-20-2016, 05:29 PM   #59
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Well.... I logged on Vanguard today and guess what... they have a link to a page talking about ROTH conversion...


https://investor.vanguard.com/ira/ro...ady:Roth:SO:XX


Has a link for calculation even though I did not take a look at it....


SOOOO, seems they do 'do' it...
Any other links? This one won't resolve for me.
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Old 12-21-2016, 01:39 PM   #60
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That's how I see it also - not part of the free service.

On the Vanguard site the link Midpack gave:

https://investor.vanguard.com/financ...ncial-planning

and that page has a line/link:

Find out how you can benefit from low-cost advice

https://investor.vanguard.com/financ...ncial-planning

-ERD50
Does Vanguard offers any decumulation services? Mutual fund companies and their reps make there money selling funds, not cashing them in.
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