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  • My Roth Conversion Odyssey (Part 2) [View article]
    "But why would you take a 72T distribution out of an account (your Roth IRA) that's growing tax-free for the rest of your life." - horowitzcpa

    One case might be for someone who wishes to retire before reaching age 59 1/2 (assuming they have 'enough' in a Roth retirement account to support themselves off its earnings).

    By using SEPP they can withdraw a steady stream of income from the Roth without incurring the 10% penalty. At 59 1/2, or 5 years later, (whichever is longer) they can stop the SEPP and withdraw any amount from the Roth without penalty.

    The SEPP allows you to avoid the 10% penalty and use the Roth proceeds before reaching age 59 1/2.
    Jan 26, 2015. 07:58 PM | 1 Like Like |Link to Comment
  • My Roth Conversion Odyssey (Part 2) [View article]
    "Also, remember that taxes are due "as you go" so you may be assessed a penalty for not making estimated payments earlier in the tax year." - KKing

    True as far as it goes. However if you withhold (via payroll and equal estimated payments) more than the prior year's tax liability there is no penalty.


    Say your final tax liability for 2014 was $10,000 and you expect 2015 payroll withholding to be $8,000. If you make four $500+ quarterly estimated withholding payments there will be no penalty on your 2015 taxes.

    You may wish to withhold more depending on how large your Roth conversion is (to minimize your tax due with your 2015 return), but you don't have to worry about the penalty applying.
    Jan 25, 2015. 05:25 PM | 2 Likes Like |Link to Comment
  • My Roth Conversion Odyssey (Part 2) [View article]
    Thanks for spelling out the details of your conversion journey David. Articles like this one helped me recognize an opportunity in my own IRA/Roth planning back in December.

    The largest holding in my IRA dropped significantly in price just before the holidays. I was able to convert everything to my Roth account at the lowest IRA valuation my account has ever seen. Since then my stock has recovered significantly and I feel my retirement savings tax planning is now greatly simplified.

    I still have the conversion value to pay tax on, but I felt that the future valuation will only continue to grow so I am better off paying the "minimum" tax now than to continue paying tax on larger values later. That may not be the case for everyone, but it was in mine. In addition, the local business I own shares in experienced a rough year in 2014 so there are losses there to partially offset the conversion 'income'. If I'm lucky the tax I pay will be minimal and the tax benefits will be forever.

    Without articles like this one I would never have been aware of the opportunity to convert when it appeared.
    Jan 25, 2015. 01:19 PM | 2 Likes Like |Link to Comment
  • My Roth Conversion Odyssey (Part 2) [View article]
    "I am taking advantage of 72T distributions from my ROTH before age 59 1/2 which are tax free too." - Brucejfern

    A semantic clarification:

    The 72T distributions avoid the 10% penalty for early withdrawals. I believe that 72T distributions from a ROTH are always tax free.

    The IRS calls 72T distributions SEPP (Substantially Equal Periodic Payments):
    Jan 25, 2015. 12:55 PM | 3 Likes Like |Link to Comment
  • The Swiss National Bank's Move And What It Means For Gold Investors [View article]
    "And gold just got a lot cheaper in Swiss franc terms... " - Gene Jaquet

    Which might lead one to wonder if the SNB will be buying more gold any time soon, while the opportunity presents itself?
    Jan 19, 2015. 11:19 AM | 6 Likes Like |Link to Comment
  • Using MPT Factor Tilts In Stock Selection [View article]
    "I was trying to construct a Modern Dividend Theory to contrast to Modern Portfolio Theory. Step one was to get around the dividend-irrelevance theorem. It is hard to build a theory about something that you first dismiss as irrelevant." - DVK

    It is indeed a sad thing to witness those whose chief limitations are due to self-imposed unquestionable beliefs. To each his own though, I guess.
    Jan 17, 2015. 12:18 PM | 3 Likes Like |Link to Comment
  • Dividend Contenders: 48 Increases Expected In The Next 11 Weeks [View article]
    "Bought DLR just over a year ago ... this make me look like a genius." Dividend Nut

    I also got my DLR in late 2013 / early 2014 for an average price of ~$49.30, but it's due to Brad Thomas' genius, not my own. I was simply willing to buy what appeared to be a well run business at a time when the market could only see its faults and priced it accordingly.

    I must admit I'm pleased with the results so far. :-)
    Jan 17, 2015. 10:56 AM | 4 Likes Like |Link to Comment
  • Update: Gold Resource Reports Outstanding High-Grade Drill Results At Alta-Gracia [View article]
    Thanks for the timely update. I'm pleased as punch that I backed up the truck when GORO dipped down to $3.00 per share. I'm DRIP'ing the monthly 4% dividends and so far the shares are up over 20% (before the drill results were released).

    If we're really lucky the combination of expanding proven resources, increased recovery from the new mill, recently rising precious metal prices, and a possible increase in the dividend will drive the shares much higher into the high single digits, or beyond.

    That'd be nice.
    Jan 17, 2015. 09:59 AM | 1 Like Like |Link to Comment
  • Using MPT Factor Tilts In Stock Selection [View article]
    Nice application of the always touted MPT Factors in selecting DG stocks to own individually. I don't see how the anti-DGI crowd can be against that.

    I keep thinking you should have a subtitle for this article. It reminds me of one of David Fish's Smackdown articles. I'd call it an MPT Factor Smackdown. Ha!!
    Jan 17, 2015. 09:44 AM | 5 Likes Like |Link to Comment
  • A Real Dividend Growth Machine: 2014 Review [View article]
    After reading your first article some time ago I immediately started following your writings. Every new article continues to prove that was a wise choice to make. Your investing execution is spot on too. Thanks for taking the time to share with everyone here on SA.

    In addition to being happy to see you are doing very well I must admit that it's no surprise to me. You have established a framework for investing success that few bother to attempt and it will pay off in the end. Congrats and keep it going.

    Have you laid out a series of portfolio goals (income or total value) over the years until you reach retirement age? If so comparing your results to that series of goals would probably be a positive addition to your reviews, IMHO.

    If you can continue to compound the current portfolio value at 8.8% CAGR you will reach Chowder's $3 Million goal by age 65. Getting there by age 60 would require a CAGR of 10.5%. 13.1% CAGR gets you there by age 55.

    Congratulations. You've put yourself in a quite favorable position at your age. Well done and please keep posting your reviews going forward. Lots of younger folks will be able to see it's possible that way and that can't be a bad thing.
    Jan 12, 2015. 07:17 PM | 5 Likes Like |Link to Comment
  • Year-End Review Of Dividend Growth Investing Vs Total Return Investing [View instapost]
    Thank you for posting your data. It is a rare case when anyone who is still examining the comparison between TR/indexing and DGI provides actual data to contrast.

    Your balanced approach looks to be about 5% ahead of DVK's model DGI portfolio based on the data presented, but that's not the whole story.

    To take things a step further I would point out that your two-fund approach provides a yield of around 1.5% vs DVK's yield of around 4%. That's a pretty significant difference in income generated (that might not matter to some, but it's still a difference once retirement hits).

    In addition, your two-fund approach has a blended beta around 1.15 while DVK's portfolio has a beta closer to 0.7.

    Given the large difference in beta, it is not surprising that the two-fund approach had higher TR than DVK during the strong bull market period between 2009 and 2014. The two-fund combination should have outperformed by a great deal more than 5% in order to offset the higher risk that will likely show itself in the next market downturn.

    I haven't done the math, but on a risk adjusted return basis I believe that DVK's portfolio performance would exceed the two-fund approach you show here.

    It will be interesting to see how the two approaches fare as time passes. The next significant downturn might change things somewhat.
    Jan 11, 2015. 05:57 PM | Likes Like |Link to Comment
  • My Dividend Growth Portfolio: 2014 Review And 2015 Preview [View article]
    "But then what would we do with the dividend cuts?" - rashbaugh

    Cue the Magic Pants self-repair kit....
    Jan 11, 2015. 05:02 PM | 3 Likes Like |Link to Comment
  • My Dividend Growth Portfolio: 2014 Review And 2015 Preview [View article]
    "Smarty, don't tear the magic pockets in your Magic Pants when you are buffing, or they might lose their magical quality." - DVK

    Dave ...... They're Magical!! That makes them impervious to almost everything. I think somewhere in the back pocket is a self-repair capability, just in case I run into kryptonite.
    Jan 11, 2015. 05:00 PM | 3 Likes Like |Link to Comment
  • My Dividend Growth Portfolio: 2014 Review And 2015 Preview [View article]
    "The dividend agnostic people will now call them dividents because they put a dent in a companies book value or some other such nonsensical thing." - Chowder

    Not to worry. I've got Magic Pants. I buff those dividents right out with 'em. Leaves my portfolio looking like new. ;-)
    Jan 10, 2015. 02:19 PM | 8 Likes Like |Link to Comment
  • My Dividend Growth Portfolio: 2014 Review And 2015 Preview [View article]
    "I love my dividents too, don't want to discriminate. (Sounds vaguely like teeth, or maybe a chewing gum for middle schoolers.)" - DVK

    Given it's a CNBC label, it might not be intended as a flattering term.

    I'm thinking that dividents could be the marks left when dividends 'hit' your account. After several decades of dividents any portfolio would be all nicked and dinged up. Who would possibly want that? The horror!
    Jan 10, 2015. 12:56 PM | 5 Likes Like |Link to Comment