Schwab's Advice For Retirees Unprepared For Market Downturns

you can believe other wise but a drop in portfolio value is a drop in value ,period .

if you have a 100k and fall 40k and dont sell all you still have is 60k left for markets to comound on

if you have a 100k in a s&p fund and it falls 40k and you sell and buy a total market fund , you have the same 60k left for markets to compound on .

you are down 40k in value regardless

if all you ever had was 60k and bought in after markets fell , you have 60k left for markets to comound on .

all 3 are exactly the same effect .

if anyone here disputes that then i can’t explain it to you any better DOWN IS DOWN .

in all cases we only hope we have a ride up to higher values.

there really is nothing else to say except believe what you like but the math says you are just as down as except for taxes cost basis no longer plays a roll as far as what you have to live on.

can anyone here tell us your cost basis on a retirement account spanning decades of time with multiple employers and iras mixed ?

i higly doubt that nor does cost basis mean a thing . only our value has any meaning in retirement accounts and whether we are up or down over what ever time frame you use .

most of us use a past high or just measure year over year balance changes
 

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mathjak107 said:
they are fools if they chase yield .

no matter what the yield is if your share value falls more you lost money .

in the case of jepi you lost 6% over just one week and 5% over the last month and that is counting all that interest .

a money market was a better investment so far this year . you would have over 6% more with interest from the money market

if you don’t understand this and the fact that fund is now losing money you shouldn’t be telling people what is good
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I like DNP, especially in the Roth.
 
You make some good points @mathjak107 but when I spoke of doing Roth Conversions at the dip I'm not sure you understand me.

I'm not wishing for dips, just assuming they're inevitable. And given that, such Conversions at the dip cost me less cash to pay the taxes on them when I do. The idea being that as the dip is exited the (new) Roth money will catch the wave just like anything remaining in my tax-deferred account(s) will.
 
prepaying the taxes up front or at the end assuming same brackets is a wash mathematically in a conversion .

so unless brackets will change or iirma charges are hit , which one is ridden back is irrelevant .

in your case it may work better because of brackets changing or surcharges, in my case nope…

this is another area people tend to not calculate properly.
lthey just assume converting and riding back tax free is better .

but mathematically paying the same tax rate up front works out the same as paying it later on , on the bigger balance growing more money on the tax money they prepaid.

so assuming iirma surcharges are not an issue of brackets changing then balances are the same at the end because even though one paid lower taxes on the dip , that money they used to pay the taxes now lost all future compounding .

so as my example demonstrated there was nothing gained or lost by converting at the dip unless other factors are involved , which in your case you said there were
 
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mathjak107 said:
which in your case you said there were
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Yes, I expect my taxable income to double next year and push me into higher brackets and IRMAA cliffs. A few years later RMDs kick in, but at least that date has been pushed out a few years.

But everyone's situation is different and we still don't know what might happen with things like SS taxes. In my case a State pension tax has started to roll back as well.
 
yeah , they first have to solve the underfunded trust .

about 5-6% of what is paid out in social security comes from the income taxes paid on ss that is credited to the trust.


about half of ss recipients pay at least some income taxes.

another 5-6% comes from interest on the bonds .

so there is a lot of funding needed before there is any serious consideration of dropping the taxes on ss
 

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