In case you are not following the comments, reader dan23 and I had fun doing algebra. The circular reference comes down to solving something like this:
d = (30000 – d) * (4% + (30000 – d – 15510 * 1.5) / (15510 * (2 – 1.5)) * (6.3% – 4%))
Can you solve this by hand? Is 8th grade math fair game for our citizens?
These articles caught my attention this week:
2014 Tax Brackets, Standard Deduction, and Other Changes by Mike Piper at Oblivious Investor
Low inflation means very small changes.
Do you max? by Maria Bruno and Stephen Weber at Vanguard Blog
The IRA contribution, that is. If you contribute the maximum to your IRA, don’t think you are exceptional just yet. You have good company. Half of those who contribute to an IRA contribute the max. Of course you want to know what percentage of people contribute to an IRA to begin with. The article doesn’t say.
Breakthrough: The Accidental Discovery That Revolutionized American Energy by Gregory Zuckerman at The Atlantic
This is a fascinating story. I’m surprised the guys who persisted at making a breakthrough got so little in compensation. I’m going to get the book The Frackers.
Adjusting payroll withholding is a key tax move to make now by Kay Bell at Don’t Mess With Taxes
It’s time to take a look at my tax withholding to make sure I fall into a safe harbor. I don’t want to pay a penalty again as I did last year.
PenFed Raises 3-Year and 4-Year CD Rates and Hot 19-Month CD Special at Money One Federal Credit Union by Ken Tumin at DepositAccounts.com
Although bond yields fell from their recent highs, some banks and credit unions are catching up in raising their CD rates. These CDs represent a preferable alternative to bond funds that are subject to the whims of any resurrection of Fed tapering.
Redeem Older I-Bonds to Buy New Ones? by Michael at Financial Ramblings
The Treasury Department surprised everyone with a 0.2% increase in the fixed rate. I’m hanging on to my bonds with 0% fixed rate for now. Maybe another increase is coming next year?
More evidence: Why I Bonds are a no-brainer buy by David Enna at TIPS Watch
I Bonds are a good option if you have a lot of money. Otherwise many other options are much better: Mango, Union Plus, Build My Savings, reward checking account, just to name a few. These pay from 3% to 6% interest guaranteed.
Why can’t I add to my HSA with my new health insurance plan? by Nancy Metcalf at Consumer Reports
Not all insurance plans with a high deductible are HSA-qualified High Deductible Health Plan.
Good riddance to useless mini-med health insurance plans by Nancy Metcalf at Consumer Reports
I heard the hoopla about those cancelations. Nancy correctly pointed out the canceled policies aren’t worth keeping anyway.
Why should a childless man have to buy maternity coverage? by Nancy Metcalf at Consumer Reports
Another gripe busted. Great job, Nancy Metcalf!
Stocks as a Long-Term Hedge for Inflation by Wade Pfau at Wade Pfau’s Retirement Researcher Blog
No offense to Professor Pfau but you should be weary of articles that praise stocks when the stock market is doing well. One’s risk tolerance naturally gets higher when the stock market is going up all the time.
The Dangers of a Stock Market Melt-Up by Jeff Sommer at New York Times
Should I Buy Twitter Stock? The Official Flowchart for Every Retail Investor by Derek Thompson at The Atlantic
Everybody knows you shouldn’t buy Twitter stock, right? Yet if you bought it at the open at $45, you could sell it for $50 in 30 minutes. 10% return in one day. I’m always amazed by the disconnect between strategy and outcome.
Will Social Security run out of money? by Steve Vernon at CBS MoneyWatch
Not literally, but that’s not what people mean when they say Social Security will run out of money.