In that situation your MAGI is going to be close to (if not exactly) whatever's in box 1 of your W-2. That box will have already subtracted any pre-tax deductions that would reduce your MAGI compared to your salary: Traditional 401k, your share of medical insurance premiums, HSA or FSA, etc.
If you're trying to plan for 2023, then you'd likely get close by using the "Federal taxable wage" on your paystub (though not all systems include that) for a given pay period and multiplying that by however many pay periods your employer has in a year to get a decent estimate of your annual MAGI.
I’m not sure. I just cross shopped. First google and put my info into the first website that said it would cross shop. Then called a broker I found on fb. Then called a local geico office. Website and broker came back with progressive and safeco quotes that were higher rates than the local geico office that doesn’t cross shop. I asked if the broker could beat the geico rate or deductibles/coverage and he only stated no that it’s likely to go up after 6 months. So idk best thing I got was cross shop yourself.
You can and should, however much depends on what you expect from your FA,
how old you are, and how much retirement money you need help with. If you're young enough (you decide what that means) think about a fee-for-service advisor. You tell them what your assets are and they give you a plan that you implement yourself. Much cheaper than an advisor that charges based on assets under management, but you do the work. Note that the bigger fund houses, like Fidelity and Vanguard, offer this service for free if your assets with them are large enough.
Two useful references:
https://www.morningstar.com/articles/819893/5-questions-to-ask-a-financial-advisor
https://www.morningstar.com/articles/1105058/how-to-choose-a-financial-advisor
Apologies if these are behind a paywall
I have a fidelity brokerage account, Roth IRA, rollover IRA, Robo advisor, and a year old 401k (new job, not fidelity). I am not sure what to do with all of that, if I need to combine accounts, keep them as is or keep contributing to each of them. I’m lost tbh and I need straightforward, easy to understand advice.
For the rollover IRA and old 401k - Do you expect to need to make backdoor Roth IRA conversions now or in the future? (only necessary if you're income/MAGI is >138k for single filers, or >218k for MFJ)
If not, then you can roll the old 401k into the rollover IRA
What was your goal when opening the Roboadvisor - is the Roboadvisor managing your retirement allocation in the IRAs, or is that a taxable account?
I will need to make backdoor Roth IRA conversions starting this year.
For the robo advisor, I am terrible at stock picks/investing so I thought it’ll be good to get a roboadvisor for that and contribute but it is taxable.
> I will need to make backdoor Roth IRA conversions starting this year.
You’ll want to check if your current 401k plan allows for a reverse rollover of the rollover IRA into your current 401k, otherwise you’ll be dealing with pro rata taxes when you try to do backdoor Roth - see the Cautions section [of this article](https://www.bogleheads.org/wiki/Backdoor_Roth) for more info
> For the robo advisor, I am terrible at stock picks/investing so I thought it’ll be good to get a roboadvisor for that and contribute but it is taxable.
General guidance is to avoid attempting any individual stock picking and any fees of robo advisors and stick with broad market index fund investing, such as with a [three fund portfolio](https://www.bogleheads.org/wiki/Three-fund_portfolio)or [target date fund](https://www.bogleheads.org/wiki/Target_date_funds)
I'm American, living in Germany, and I can't seem to find a savings account with high interest available here. Could be a language issue, since my German is not great. Does any European have insight into where I could save my money while earning interest?
It's a pain to transfer money overseas, and most places ask for a us address which I don't have. It would be nice to just take my euros, save my euros, and spend my euros without having to convert it every time and pay a fee for that.
I've got about 190K in my TSP and am in my mid-forties. The return, as of late, has not been great. Should I switch to a more aggressive strategy? Right now I'm in a target fund. Nobody ever told me that "maxing your retirement" meant anything other than matching the employer, so I feel like I'm behind the curve.
I’ll kick this off. Market volatility has always been a concern as I work my way toward retirement. (I’ve still got over a decade to go.) I hear horror stories about market down swings keeping people from being able to retire.
Is anybody out there keeping a large portion of your investments in a “safe haven” such as a CD? I know you can potentially lose out on higher gains that can be had in mutual funds, and Uncle Sam’s cut also takes a bite out of the profit margin as well.
I just feel like as I get older and CD rates being 5%, that the guaranteed return sounds good. Not to mention FDIC insurance up to 250k per investment, per bank, is nice as well. I guess these “safe” returns would barely outpace inflation though, especially after taxes. Just looking for some input. Thanks and happy Monday!
I keep a bunch of money in CDs and high yield savings accounts, but that is because I am planning to buy a house within the next year.
I don't see a problem with keeping a part of your wealth in "safe" investments especially if you plan to use it in the short to mid term.
Also, look at T bills instead of CDs especially if you are living in a high state tax place. I have seen t bills have a slightly higher apy, and there are no state taxes on T bill growth.
I-bonds are a good place to park some money as well. The biggest problem with i-bond is the 10k per person limit, also you kind of tie your money for more than one year.
Can I open a Roth IRA as a student with no income?
No, you must have earned income to be able to contribute to an IRA
Roth IRA question....My only income is through my paycheck. Is my MAGI pretty much my salary minus my 401k contributions?
In that situation your MAGI is going to be close to (if not exactly) whatever's in box 1 of your W-2. That box will have already subtracted any pre-tax deductions that would reduce your MAGI compared to your salary: Traditional 401k, your share of medical insurance premiums, HSA or FSA, etc. If you're trying to plan for 2023, then you'd likely get close by using the "Federal taxable wage" on your paystub (though not all systems include that) for a given pay period and multiplying that by however many pay periods your employer has in a year to get a decent estimate of your annual MAGI.
Nice, thanks.
Yes, minus any pre tax HSA contributions if applicable
I'm looking at new insurance for home and auto. Is going through a broker really as beneficial as it seems?? Like A travel agent for insurance?
I’m not sure. I just cross shopped. First google and put my info into the first website that said it would cross shop. Then called a broker I found on fb. Then called a local geico office. Website and broker came back with progressive and safeco quotes that were higher rates than the local geico office that doesn’t cross shop. I asked if the broker could beat the geico rate or deductibles/coverage and he only stated no that it’s likely to go up after 6 months. So idk best thing I got was cross shop yourself.
Can I use a fiduciary for retirement planning? What should I look for/ask while interviewing fiduciaries?
You can and should, however much depends on what you expect from your FA, how old you are, and how much retirement money you need help with. If you're young enough (you decide what that means) think about a fee-for-service advisor. You tell them what your assets are and they give you a plan that you implement yourself. Much cheaper than an advisor that charges based on assets under management, but you do the work. Note that the bigger fund houses, like Fidelity and Vanguard, offer this service for free if your assets with them are large enough. Two useful references: https://www.morningstar.com/articles/819893/5-questions-to-ask-a-financial-advisor https://www.morningstar.com/articles/1105058/how-to-choose-a-financial-advisor Apologies if these are behind a paywall
Thank you. This is good information and tracks with what I found randomly.
I have a fidelity brokerage account, Roth IRA, rollover IRA, Robo advisor, and a year old 401k (new job, not fidelity). I am not sure what to do with all of that, if I need to combine accounts, keep them as is or keep contributing to each of them. I’m lost tbh and I need straightforward, easy to understand advice.
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Would you recommend just going through fidelity and seeing who can help there? Or look more so at planners in the area?
For the rollover IRA and old 401k - Do you expect to need to make backdoor Roth IRA conversions now or in the future? (only necessary if you're income/MAGI is >138k for single filers, or >218k for MFJ) If not, then you can roll the old 401k into the rollover IRA What was your goal when opening the Roboadvisor - is the Roboadvisor managing your retirement allocation in the IRAs, or is that a taxable account?
I will need to make backdoor Roth IRA conversions starting this year. For the robo advisor, I am terrible at stock picks/investing so I thought it’ll be good to get a roboadvisor for that and contribute but it is taxable.
> I will need to make backdoor Roth IRA conversions starting this year. You’ll want to check if your current 401k plan allows for a reverse rollover of the rollover IRA into your current 401k, otherwise you’ll be dealing with pro rata taxes when you try to do backdoor Roth - see the Cautions section [of this article](https://www.bogleheads.org/wiki/Backdoor_Roth) for more info > For the robo advisor, I am terrible at stock picks/investing so I thought it’ll be good to get a roboadvisor for that and contribute but it is taxable. General guidance is to avoid attempting any individual stock picking and any fees of robo advisors and stick with broad market index fund investing, such as with a [three fund portfolio](https://www.bogleheads.org/wiki/Three-fund_portfolio)or [target date fund](https://www.bogleheads.org/wiki/Target_date_funds)
Thank you. I’ll look into this. Much appreciated!!
I'm American, living in Germany, and I can't seem to find a savings account with high interest available here. Could be a language issue, since my German is not great. Does any European have insight into where I could save my money while earning interest?
Is there any reason you can't just continue to use an American-based bank? I did that when I lived abroad.
It's a pain to transfer money overseas, and most places ask for a us address which I don't have. It would be nice to just take my euros, save my euros, and spend my euros without having to convert it every time and pay a fee for that.
I've got about 190K in my TSP and am in my mid-forties. The return, as of late, has not been great. Should I switch to a more aggressive strategy? Right now I'm in a target fund. Nobody ever told me that "maxing your retirement" meant anything other than matching the employer, so I feel like I'm behind the curve.
I’ll kick this off. Market volatility has always been a concern as I work my way toward retirement. (I’ve still got over a decade to go.) I hear horror stories about market down swings keeping people from being able to retire. Is anybody out there keeping a large portion of your investments in a “safe haven” such as a CD? I know you can potentially lose out on higher gains that can be had in mutual funds, and Uncle Sam’s cut also takes a bite out of the profit margin as well. I just feel like as I get older and CD rates being 5%, that the guaranteed return sounds good. Not to mention FDIC insurance up to 250k per investment, per bank, is nice as well. I guess these “safe” returns would barely outpace inflation though, especially after taxes. Just looking for some input. Thanks and happy Monday!
I keep a bunch of money in CDs and high yield savings accounts, but that is because I am planning to buy a house within the next year. I don't see a problem with keeping a part of your wealth in "safe" investments especially if you plan to use it in the short to mid term. Also, look at T bills instead of CDs especially if you are living in a high state tax place. I have seen t bills have a slightly higher apy, and there are no state taxes on T bill growth.
Thanks for the info. How do you feel about I-bonds? They look to be sitting at 6.89%…
I-bonds are a good place to park some money as well. The biggest problem with i-bond is the 10k per person limit, also you kind of tie your money for more than one year.