Retiring Early: Effect On Social Security Benefits

Social Security has a flat 6.2% tax rate, up to the maximum wages covered by Social Security ($117k in 2014). Social Security benefits bear some positive relationship with your covered wages and the amount of taxes you paid on those wages. The higher your covered wages, and the higher the 6.2% Social Security taxes you paid, the higher your benefits. Social Security calculates benefits using your average earnings over 35 years. If you work less than 35 years, the rest of the years will be filled [...]

2015 401k 403b IRA Contribution Limits

The government released the Consumer Price Index for July 2014. Inflation is higher this year but still low by historical standard. Although we don't have all the necessary numbers yet, because the way rounding works, I'm able to comfortably project [...]

Stop Using Vanguard Money Market Fund

The SEC released news rules on money market funds last week. Money market funds for retail investors will still keep the $1 fixed NAV. They can impose fees and restrictions when they face liquidity problems. I don't think Vanguard's money market [...]

Social Security Claiming Strategy Calculators Compared

Financial Engines was founded by Nobel laureate William Sharpe. It offers investment advice primarily through workplace retirement plans. Recently Financial Engines launched a free Social Security planner. I test-drove it with some hypothetical [...]

Bonds Had Good Returns: Wrong In CDs?

Both stocks and bonds did well in the first half of 2014, especially bonds. Vanguard Total Bond Market Index Fund returned 3.9% in six months ended on June 30 whereas Vanguard Total Stock Market Index Fund returned 7% in the same period. If we get a [...]

Insights From How America Saves 2014

Vanguard produces a comprehensive study every year of the 401k-type plans it administers. The study includes 3 million people. The large sample makes it reflective of the population as a whole. I'm noting down the bits I found interesting in the [...]