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FIFA Financials

R Quinn  |  Jul 19, 2026

"Me, too. Prices not outlandish."
- Jeff Bond
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Before Someone Else Decides

Kathleen Rehl  |  Aug 2, 2026

"What a difficult and unsettling situation for all of you. You’ve described one of the hardest parts of planning ahead: family members can clearly see that living alone is becoming unsafe, yet the older adult is still entitled to make his own choices—even choices that others find baffling, like adopting a puppy while recovering from surgery. Your words, “we’re living some of it in real time” really struck me. This is precisely the narrow window when candid conversations and acceptable choices may still be possible, before a medical crisis forces the decision. I hope his upcoming surgery goes well and that your family can help him accept some form of support, whether in his home or closer to one of you, while he can still have a meaningful voice in what happens next. Thank you for sharing such a vivid, honest example of why these conversations matter."
- Kathleen Rehl
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Roth Conversions and Taxes

ArticleJohn Urban  |  Aug 8, 2026

EVERY ARTICLE ABOUT Roth conversions says the same thing: pay the tax from taxable money, not from the IRA. That is good advice if you have taxable money. Plenty of retirees do not. Their savings sit almost entirely in a traditional IRA, built from years of 401(k) contributions and a rollover at retirement, with little brokerage money and no cash reserve worth naming. For them, “pay from outside money” is not advice. It is a condition they do not meet. Their real choice is a self-funded conversion or no conversion at all. The familiar warning is that self-funding requires a gross-up. You withdraw money to pay the conversion tax, that withdrawal is itself taxable, so you have to withdraw a little more. Less discussed is what else that withdrawal sets off. It makes more of your Social Security taxable, it raises your Medicare premiums two years later, and in a high-tax state it enlarges the amount that has to leave the IRA. Here is what those three cost, on one household. A cautious conversion Meet Dianne, a composite rather than a real person. She is 66, single, retired to Florida, with $1 million in a traditional IRA and nothing outside it. Social Security pays her $28,000 a year. She is past 59 and a half and already on Medicare. Florida keeps state income tax out of the arithmetic for now. She converts $40,000. Careful, modest, the size people choose when they are trying not to do anything dramatic. The tax on that conversion, paid from a checking account she does not have, would be $4,234. Funding it from the IRA instead, the withdrawal that covers it is $5,125, and her tax rises to match. That extra $891 is 17.4% of the $5,125 she withdrew. Her ordinary-income bracket is 12%. Twelve of those points are the tax on the withdrawal itself, which is the gross-up everybody expects. The other 5.4 points come from $2,300 of her Social Security being pulled into taxable income by that same withdrawal. Paying from cash, $21,500 of her benefit would be taxable. Self-funding, $23,800 is. The difference is caused by how she paid, not by what she converted, and nothing on her return will label it. Not a smaller version of a large one The effect is not linear. Run the same woman at $150,000 and 85% of her benefit, the statutory maximum, is already taxable before she funds the tax. The funding withdrawal drags in nothing further, and this particular cost is zero. That is not an argument for converting more. It is an argument against assuming a small conversion is simply a smaller version of a large one. The one that looks cautious can carry the higher marginal rate. What self-funding actually costs Give Dianne the $150,000 conversion, still with no outside cash, and add the state question. Still in Florida, $195,469 has to leave the traditional IRA to put $150,000 into the Roth. Move her to California, changing nothing else, and it is $219,751. That is $1.30 of IRA spent for every dollar reaching the Roth, against $1.47, and the gap is California income tax compounded through the gross-up. If a move across state lines is anywhere in your plan, the order of operations may matter more than the size of the conversion. But $1.47 invites a conclusion it does not support, and I would rather correct that myself than let it travel. A conversion is taxable whichever pocket pays. Of the $69,751 Dianne withdraws in California, roughly $44,639 replaces cash she would have spent anyway. The incremental cost of self-funding, in wealth given up, is $25,111. About 17% of the conversion, not 47. The bill that arrives in 2028 At that $150,000 conversion, self-funding also costs Dianne $1,735 in higher Medicare premiums, a surcharge of $6,355 rather than $4,620, charged on top of the standard premium, for one year, and hers alone as a single filer. The bill arrives two years late. Medicare sets her 2028 premiums from her 2026 income, so the cost is invisible at the moment she is deciding how to pay the 2026 tax. When it can still make sense Doing nothing is not free either. Money left in a traditional IRA comes out eventually, under required distributions, at whatever rates apply then, possibly to a survivor filing single, possibly to heirs facing a 10-year deadline. Where self-funding still holds up, a few things tend to be true. The rate gap is durable rather than a one-year accident. Whether it repays a cost this size depends on time, future tax rates and investment returns. A temporary dip in income is a thin foundation. A structural window, after retirement and before Social Security or required distributions begin, is more compelling. There is runway, because shrinking the portfolio to change its tax character needs years of tax-free growth to earn back. Age 59 and a half is cleanly behind you. The converted amount is not subject to the 10% additional tax on early distributions. A separate distribution taken to pay the tax generally is, unless an exception applies. And enough is left afterward. Check the balance after the funding withdrawal, not after the conversion. Dianne’s California IRA drops to $780,249, and whether that funds the next 30 years matters more than whether the conversion was tax-efficient. A practical warning about withholding Withholding from the conversion is not a cheaper way to pay the tax. It reduces what reaches the Roth. Elect 24% on Dianne’s $40,000 conversion, as this illustration does rather than as any custodian requires, and $9,600 goes to the IRS while $30,400 lands in the Roth, against $4,234 actually owed. The cash comes back next spring as a refund. The Roth room does not come back at all. Restating the rule Pay the conversion tax from outside cash if you have it. That remains the best answer. It is not an answer for the retiree whose savings are almost entirely in a traditional IRA. For that person, “never pay from the IRA” skips the actual decision, which is whether a self-funded conversion, with its full marginal cost, beats leaving the money where it is. Before deciding, count the gross-up, the Social Security effect, state tax and the Medicare bill two years later. Sometimes that arithmetic still says no. It beats applying a rule written for somebody with a different balance sheet. ________________________________________________________________________________ John Urban is the founder of RetireSmartIRA, a retirement tax-planning app. Earlier, he founded GT Nexus, a supply-chain software company acquired by Infor in 2015. He lives in Northern California with his wife, Kathy, and enjoys time with family, travel, reading, Bay Area sports, and the occasional deep dive into the fine print of the tax code.
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“Gerontocracy” in America

Chris Rush  |  Aug 6, 2026

"From ChatGPT... "Gerontocracy in America by Samuel Moyn argues that the United States has developed a deeply entrenched system where the oldest generations control the majority of political and economic power, creating significant inequality for younger people. To combat this, Moyn proposes "intergenerational equity" through reforms such as age limits, campaign finance changes, and encouraging a "socialist way of aging" to encourage older leaders to cede power. Learn more about the arguments and proposed solutions at Macmillan Publishers.  Core Arguments:
  • Wealth and Power Hoarding: Older Americans control a disproportionate share of financial assets, housing, and institutional leadership roles in legislatures, businesses, and courts. 
  • Structural Bias: Economic policies, tax codes, and political campaign financing are heavily skewed to protect and benefit older demographics. 
  • Generational Stagnation: The concentration of power blocks younger generations from starting their careers, buying homes, and attaining civic influence.
Proposed Solutions
  • Mandatory Retirement: Setting enforced retirement or age caps for prominent leadership positions, including political offices, corporate executives, and academia.
  • Intergenerational Transfers: Encouraging earlier asset and wealth sharing between older and younger generations.
  • Democratic Reforms: Empowering young voters and rebalancing political representation to break the systemic grip of elder rule. 
Interestingly, this 54-year-old author berating today's seniors benefited from a Harvard and Yale education... most likely funded by his "Boomer Parents." Also, based on his fields of study and education, stereotypically he is most likely a liberal Democrat politically, so I am not surprised that his solutions sound like they were written by AOC, Bernie Sanders, and Mamdani. But...that's just my opinion."
- Mike Lynch
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What is the right percentage?

R Quinn  |  Aug 9, 2026

"I tend to agree with Brother Quinn! It's sort of funny, but I am actually recieivng more income now that I am retired than I did the last years I was working. My last 3-year contract as an academic was $105,000 annually. From that amount, I was maxing out my 403 (b) and paying income taxes as well. My "additional Income" from SS added $45,000, taxed at the maximum SS rate. As a retired person, our SS is @73,000 annually, and our Annuity Income is $36,562... totaling $109,562. However, we are no longer contributing to a 403(b), and our taxes went from the 22% to the 10% bracket on much smaller taxable income. (72% of the annuity income is income tax-free.) Our additional income these days comes from 4% withdrawals from our Portfolio, totaling $1,956 monthly. Those are LTCGs, which are taxed at the 0% capital gains rate. So, all in all, we are making $133,034 annually... after Medicare Part B is deducted from our SS. Our RMDs are QCDs, and life on earth is good!"
- Mike Lynch
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Looking Back On My Hard Luck Days

DAN SMITH  |  Aug 7, 2026

"Jerry, we have a Bible study (church-sponsored) that meets in our home. There are 13 of us, six couples and a single. The oldest couple turned 70 last year. The youngest member will turn 60 next March. All of us have adult children. We started meeting in 2020, and in the 6+ years we've been together, six members have lost a parent, three couples have become first-time grandparents, and another couple and the single have added new grandchildren. All of us except one couple had COVID, several of us multiple times. There have been two cancer diagnoses, one heart attack, and myriad other health issues around the group. Plenty of worries/events with our kids--car accidents/injuries (that was our daughter, twice), prison time/mental illness, unemployment, estrangement--oh, and three weddings, too. Part of this is the natural consequence of the stage of life we're all in together, but it certainly makes it all a bit easier to take when you have friends who will pray for you, bring you meals when you're sick or lost a loved one, provide gifts for a new grandbaby, and so on."
- DrLefty
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For most retirees, the greatest fear is not death—it is running out of money before they die.

Matt Halperin  |  Aug 6, 2026

"re: but more likely you’ll find a sad story of those actually running out as a result of dementia related fraud/romance cons etc if this is true, (and i am not saying yes or no) it could equally apply to retirees with very large portfolios, and therefore not really be due to a portfolio “failing”. "
- Mark Bergman
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Short term and long term Social Security planning

William Perry  |  Aug 4, 2026

"Interesting question Robert that sent me down a rabbit hole. Using the CMS 271 page report with a transmittal letter of June 9, 2026 titled "THE 2026 ANNUAL REPORT OF THE BOARDS OF TRUSTEES OF THE FEDERAL HOSPITAL INSURANCE AND FEDERAL SUPPLEMENTARY MEDICAL INSURANCE (SMI) TRUST FUNDS" the best answer I can find appears to be that the IRMAA contributions are not broken out from the approximate 22% of total revenues that come from beneficiary premiums. Page 13 reads in part - For SMI, government contributions represent the largest source of income. These contributions covered about 75 percent of program costs in 2025. Also, beneficiaries pay monthly premiums for Parts B and D. Those premiums financed roughly 22 percent of the total cost in 2025... "
- William Perry
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Risk and Taxes

ArticleAdam M. Grossman  |  Aug 8, 2026

AFTER YEARS OF heady gains in the stock market, many investors are facing the same question: To manage risk, they’d like to cut back on one or more of their holdings. But because of the potentially costly tax bill that might result, they aren’t sure exactly how to do that. How can you square this circle? One easy option would be to donate appreciated assets to charity. But that would make sense only if it aligns with your charitable goals and, of course, if you don’t need those funds for other uses. How else could you strike a balance between managing risk and limiting taxes? Here’s how I would answer this question. Step 1. I’d start by estimating the potential risk level among your holdings. While there’s no single litmus test, you could ask the following questions. First, how large a portion of your assets does any single holding represent? As a rule of thumb, I’d focus first on individual stocks that top 5%. Why 5%? My operating assumption is that any individual stock could experience a 50% decline during a crisis. So if a holding is limited to 5%, then a 50% drop would result in an overall portfolio impact of just 2.5%. I see that as very manageable. To be sure, stocks can certainly decline by more than 50%, but I view this as a reasonable figure for risk management. While I worry most about the risk posed by single stocks, it’s also important to examine the overall composition of your portfolio. That’s because, counterintuitively, a portfolio of 30 stocks could end up being riskier than a group of just 10. Harry Markowitz, the father of Modern Portfolio Theory, explained why. In his initial work back in the 1950s, Markowitz used railroad company stocks to explain the concept of diversification. There’s nothing inherently wrong with railroad stocks, Markowitz explained. But if a portfolio consists of only railroad stocks, then that would be a problem—because companies in the same industry are often impacted by the same economic factors. In other words, a portfolio consisting of a large number of holdings might only appear diversified, so it’s important to look under the hood. Another risk factor to consider: Do you work for a public company and own the company’s stock? If so, that would be a reason to consider diversifying more quickly (within the permitted time windows). What if you own only mutual funds or ETFs? Diversified funds tend to be less risky than individual stocks, but that’s not always the case. The fund industry launches as many as 1,000 new funds each year, including many with very aggressive strategies. So it’s important to check each fund’s holdings. You can find that information on the fund company’s website or on a site like Morningstar (Here, for example, are the top holdings in Vanguard’s S&P 500 index fund). Step 2. Next, you’d want to estimate how much a loss might impact you. As with most questions in personal finance, there are two answers to consider: how it might affect you in dollar terms, and the degree to which a loss would simply be upsetting. Both are important. Step 3. If you determine the holding in question does represent a material risk, then you’d want to estimate the potential tax impact. Here are questions you might ask: What would the tax be if you exited the entire position? Would it push your income into the next capital gains bracket? Are there tax lots with less appreciation you could take advantage of? Do you have losses you could use to offset some of the gains? Do you expect to be in a higher or lower tax bracket next year? Step 4. If you conclude that the tax bill might be significant, what steps could you take to reduce a holding tax-efficiently? Here are strategies to consider: For starters, I suggest deciding on a target percentage for the holding. While ideally I prefer bringing any individual stock down to a 5% weighting, that figure isn’t a rule. All things being equal, the larger a portfolio, the more risk you can afford. After deciding on a target percentage, the simplest approach would be to set up a long-term sale plan—like dollar cost averaging but in reverse. Suppose you’d like to sell 1,200 shares of a given stock. You could sell 100 shares each month for twelve months. You’d do that regardless of whether the stock happens to be up or down that month. That 12-month schedule isn’t a rule. If your holding is very significant, you might opt for a longer timeframe. On the other hand, if you feel the stock has a particularly highflying valuation, you might choose a quicker pace. The key, in my view, is just to get started. As the writer Carveth Read wrote, “it’s better to be roughly right than precisely wrong.” Selling a stock down over time is the simplest way to reduce risk, but it’s hardly the most tax efficient. Another approach that’s been gaining in popularity is known as a 351 exchange fund. With a 351, the idea is that a group of investors, each with their own portfolios of appreciated securities, come together and collaborate to diversify their respective holdings. To provide a simplified illustration, imagine two investors, each with a concentrated holding, one in Microsoft and the other in Apple. Each would benefit by diversifying, and that’s what a 351 exchange fund allows. Each would contribute their respective shares into a common pool that would then hold some Apple and some Microsoft. This new investment would be structured as an ETF, and each investor would be issued shares proportional to the size of their contribution. Importantly, the initial creation of a 351 fund doesn’t entail any tax. Taxes are due only when an investor later sells shares of that ETF. This is a simplified example. In reality, a 351 exchange fund would hold many more than just two holdings. They’re actually required to meet various diversification requirements. As a result, investors in 351 funds may end up feeling sufficiently diversified and thus comfortable holding their fund shares for the long term. That would make this strategy potentially the most tax-efficient way to manage portfolio concentration risk. This is just an overview, though. If you’re interested in 351 strategies, I suggest further research. In July, The Wall Street Journal discussed these funds in some detail. In addition, a firm called Alpha Architect, the largest player in this area, has a number of helpful explanatory videos on its site.   Adam M. Grossman is the founder of Mayport, a fixed-fee wealth management firm. Sign up for Adam's Daily Ideas email, follow him on X @AdamMGrossman and check out his earlier articles.
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Taxing Social Security benefits

R Quinn  |  Aug 6, 2026

"I am going on a reading strike about Social Security. If the title says Social Security I do not read."
- Nick Politakis
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Jonathan’s Parting Thoughts: No. 8

Jonathan Clements  |  Aug 7, 2026

"Rob Berger had a YouTube video published 3 years ago titled "Avantis All Equity Market ETF (ticker: AVGE) Pros and Cons" where he discussed this fund which was new as it started in 2022 and he also made some comparisons with VT. I interpret Rod Berger's main concern about AVGE was the fact that as the fund was new that the newness alone was then disqualifying for him to include in his holdings. AVGE is also a fund of funds, is actively managed, tilts toward value, tilts towards US and uses a mathematical formula to look at past profitability to help fund management project which investments will be profitable in the future. That may parallel your investing thinking but I have gone with VT, for better or worse, which tracks the appropriate world equity index. A couple of key numbers and considerations - Expense ratios (net current) - AVGE 0.23%, VT 0.06% YTD gain per Morningstar 8/6/2025 to 8/7/2026 - AVGE +28.71%, VT +23.32% The VT fund at 6/30/2026 was about 80 times the size of AVGE The AVGE has a large Bid/Ask Spread which likely is caused because it is a "fund of funds" that trades underlying small-cap and value-tilted global equities and because of lower daily trading volume compared to a much larger fund like VT."
- William Perry
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Inflation, prices, COLAs, retirement and the last 16 years

R Quinn  |  Jul 27, 2026

"I suspect the posts you read from seniors are those that do not really have adequate funds built up in IRAs (or other investment orientated savings) to act as the buffer on top of SS. The world has however changed and anyone who has retired in the past 10 years (or is coming up to retirement) should be aware of the utility in maintaining equity market exposure as a key part of managing inflation (and other life event) risks. As has been discussed before SWR is only a tool not the entire answer. If you're asking how much can I draw from $1m capital then 40k pa (rising with inflation) is a reasonable answer for a 30 year lifespan etc. That does nothing to tell you whether $40k will support your lifestyle and/or leave enough surplus for unexpected needs. Hence why you also need a budget or alternately the discipline to live within the income. I'd suggest it is wise to at least think about financial strategy in weathering unexpected needs. But it doesn't need to negate the overall drawdown strategy - for some it might be drawing at only 3.5%, for others maintaining a cash-like emergency fund or being prepared to sell a second home or whatever. My approach is to have a notional "when it's gone, it's gone" pot to cover lumpy one-off spend. Then I top it up from excess from my planned drawings or if it goes, replenish by paring back lifestyle spending a bit. Some people might need to see that as a physically separate fund/account. That's personal choice (possibly for those allergic to spreadsheets/budgeting ;) ) and largely just accounting presentation."
- bbbobbins
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FIFA Financials

R Quinn  |  Jul 19, 2026

"Me, too. Prices not outlandish."
- Jeff Bond
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Before Someone Else Decides

Kathleen Rehl  |  Aug 2, 2026

"What a difficult and unsettling situation for all of you. You’ve described one of the hardest parts of planning ahead: family members can clearly see that living alone is becoming unsafe, yet the older adult is still entitled to make his own choices—even choices that others find baffling, like adopting a puppy while recovering from surgery. Your words, “we’re living some of it in real time” really struck me. This is precisely the narrow window when candid conversations and acceptable choices may still be possible, before a medical crisis forces the decision. I hope his upcoming surgery goes well and that your family can help him accept some form of support, whether in his home or closer to one of you, while he can still have a meaningful voice in what happens next. Thank you for sharing such a vivid, honest example of why these conversations matter."
- Kathleen Rehl
Read more »

Roth Conversions and Taxes

ArticleJohn Urban  |  Aug 8, 2026

EVERY ARTICLE ABOUT Roth conversions says the same thing: pay the tax from taxable money, not from the IRA. That is good advice if you have taxable money. Plenty of retirees do not. Their savings sit almost entirely in a traditional IRA, built from years of 401(k) contributions and a rollover at retirement, with little brokerage money and no cash reserve worth naming. For them, “pay from outside money” is not advice. It is a condition they do not meet. Their real choice is a self-funded conversion or no conversion at all. The familiar warning is that self-funding requires a gross-up. You withdraw money to pay the conversion tax, that withdrawal is itself taxable, so you have to withdraw a little more. Less discussed is what else that withdrawal sets off. It makes more of your Social Security taxable, it raises your Medicare premiums two years later, and in a high-tax state it enlarges the amount that has to leave the IRA. Here is what those three cost, on one household. A cautious conversion Meet Dianne, a composite rather than a real person. She is 66, single, retired to Florida, with $1 million in a traditional IRA and nothing outside it. Social Security pays her $28,000 a year. She is past 59 and a half and already on Medicare. Florida keeps state income tax out of the arithmetic for now. She converts $40,000. Careful, modest, the size people choose when they are trying not to do anything dramatic. The tax on that conversion, paid from a checking account she does not have, would be $4,234. Funding it from the IRA instead, the withdrawal that covers it is $5,125, and her tax rises to match. That extra $891 is 17.4% of the $5,125 she withdrew. Her ordinary-income bracket is 12%. Twelve of those points are the tax on the withdrawal itself, which is the gross-up everybody expects. The other 5.4 points come from $2,300 of her Social Security being pulled into taxable income by that same withdrawal. Paying from cash, $21,500 of her benefit would be taxable. Self-funding, $23,800 is. The difference is caused by how she paid, not by what she converted, and nothing on her return will label it. Not a smaller version of a large one The effect is not linear. Run the same woman at $150,000 and 85% of her benefit, the statutory maximum, is already taxable before she funds the tax. The funding withdrawal drags in nothing further, and this particular cost is zero. That is not an argument for converting more. It is an argument against assuming a small conversion is simply a smaller version of a large one. The one that looks cautious can carry the higher marginal rate. What self-funding actually costs Give Dianne the $150,000 conversion, still with no outside cash, and add the state question. Still in Florida, $195,469 has to leave the traditional IRA to put $150,000 into the Roth. Move her to California, changing nothing else, and it is $219,751. That is $1.30 of IRA spent for every dollar reaching the Roth, against $1.47, and the gap is California income tax compounded through the gross-up. If a move across state lines is anywhere in your plan, the order of operations may matter more than the size of the conversion. But $1.47 invites a conclusion it does not support, and I would rather correct that myself than let it travel. A conversion is taxable whichever pocket pays. Of the $69,751 Dianne withdraws in California, roughly $44,639 replaces cash she would have spent anyway. The incremental cost of self-funding, in wealth given up, is $25,111. About 17% of the conversion, not 47. The bill that arrives in 2028 At that $150,000 conversion, self-funding also costs Dianne $1,735 in higher Medicare premiums, a surcharge of $6,355 rather than $4,620, charged on top of the standard premium, for one year, and hers alone as a single filer. The bill arrives two years late. Medicare sets her 2028 premiums from her 2026 income, so the cost is invisible at the moment she is deciding how to pay the 2026 tax. When it can still make sense Doing nothing is not free either. Money left in a traditional IRA comes out eventually, under required distributions, at whatever rates apply then, possibly to a survivor filing single, possibly to heirs facing a 10-year deadline. Where self-funding still holds up, a few things tend to be true. The rate gap is durable rather than a one-year accident. Whether it repays a cost this size depends on time, future tax rates and investment returns. A temporary dip in income is a thin foundation. A structural window, after retirement and before Social Security or required distributions begin, is more compelling. There is runway, because shrinking the portfolio to change its tax character needs years of tax-free growth to earn back. Age 59 and a half is cleanly behind you. The converted amount is not subject to the 10% additional tax on early distributions. A separate distribution taken to pay the tax generally is, unless an exception applies. And enough is left afterward. Check the balance after the funding withdrawal, not after the conversion. Dianne’s California IRA drops to $780,249, and whether that funds the next 30 years matters more than whether the conversion was tax-efficient. A practical warning about withholding Withholding from the conversion is not a cheaper way to pay the tax. It reduces what reaches the Roth. Elect 24% on Dianne’s $40,000 conversion, as this illustration does rather than as any custodian requires, and $9,600 goes to the IRS while $30,400 lands in the Roth, against $4,234 actually owed. The cash comes back next spring as a refund. The Roth room does not come back at all. Restating the rule Pay the conversion tax from outside cash if you have it. That remains the best answer. It is not an answer for the retiree whose savings are almost entirely in a traditional IRA. For that person, “never pay from the IRA” skips the actual decision, which is whether a self-funded conversion, with its full marginal cost, beats leaving the money where it is. Before deciding, count the gross-up, the Social Security effect, state tax and the Medicare bill two years later. Sometimes that arithmetic still says no. It beats applying a rule written for somebody with a different balance sheet. ________________________________________________________________________________ John Urban is the founder of RetireSmartIRA, a retirement tax-planning app. Earlier, he founded GT Nexus, a supply-chain software company acquired by Infor in 2015. He lives in Northern California with his wife, Kathy, and enjoys time with family, travel, reading, Bay Area sports, and the occasional deep dive into the fine print of the tax code.
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“Gerontocracy” in America

Chris Rush  |  Aug 6, 2026

"From ChatGPT... "Gerontocracy in America by Samuel Moyn argues that the United States has developed a deeply entrenched system where the oldest generations control the majority of political and economic power, creating significant inequality for younger people. To combat this, Moyn proposes "intergenerational equity" through reforms such as age limits, campaign finance changes, and encouraging a "socialist way of aging" to encourage older leaders to cede power. Learn more about the arguments and proposed solutions at Macmillan Publishers.  Core Arguments:
  • Wealth and Power Hoarding: Older Americans control a disproportionate share of financial assets, housing, and institutional leadership roles in legislatures, businesses, and courts. 
  • Structural Bias: Economic policies, tax codes, and political campaign financing are heavily skewed to protect and benefit older demographics. 
  • Generational Stagnation: The concentration of power blocks younger generations from starting their careers, buying homes, and attaining civic influence.
Proposed Solutions
  • Mandatory Retirement: Setting enforced retirement or age caps for prominent leadership positions, including political offices, corporate executives, and academia.
  • Intergenerational Transfers: Encouraging earlier asset and wealth sharing between older and younger generations.
  • Democratic Reforms: Empowering young voters and rebalancing political representation to break the systemic grip of elder rule. 
Interestingly, this 54-year-old author berating today's seniors benefited from a Harvard and Yale education... most likely funded by his "Boomer Parents." Also, based on his fields of study and education, stereotypically he is most likely a liberal Democrat politically, so I am not surprised that his solutions sound like they were written by AOC, Bernie Sanders, and Mamdani. But...that's just my opinion."
- Mike Lynch
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What is the right percentage?

R Quinn  |  Aug 9, 2026

"I tend to agree with Brother Quinn! It's sort of funny, but I am actually recieivng more income now that I am retired than I did the last years I was working. My last 3-year contract as an academic was $105,000 annually. From that amount, I was maxing out my 403 (b) and paying income taxes as well. My "additional Income" from SS added $45,000, taxed at the maximum SS rate. As a retired person, our SS is @73,000 annually, and our Annuity Income is $36,562... totaling $109,562. However, we are no longer contributing to a 403(b), and our taxes went from the 22% to the 10% bracket on much smaller taxable income. (72% of the annuity income is income tax-free.) Our additional income these days comes from 4% withdrawals from our Portfolio, totaling $1,956 monthly. Those are LTCGs, which are taxed at the 0% capital gains rate. So, all in all, we are making $133,034 annually... after Medicare Part B is deducted from our SS. Our RMDs are QCDs, and life on earth is good!"
- Mike Lynch
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Looking Back On My Hard Luck Days

DAN SMITH  |  Aug 7, 2026

"Jerry, we have a Bible study (church-sponsored) that meets in our home. There are 13 of us, six couples and a single. The oldest couple turned 70 last year. The youngest member will turn 60 next March. All of us have adult children. We started meeting in 2020, and in the 6+ years we've been together, six members have lost a parent, three couples have become first-time grandparents, and another couple and the single have added new grandchildren. All of us except one couple had COVID, several of us multiple times. There have been two cancer diagnoses, one heart attack, and myriad other health issues around the group. Plenty of worries/events with our kids--car accidents/injuries (that was our daughter, twice), prison time/mental illness, unemployment, estrangement--oh, and three weddings, too. Part of this is the natural consequence of the stage of life we're all in together, but it certainly makes it all a bit easier to take when you have friends who will pray for you, bring you meals when you're sick or lost a loved one, provide gifts for a new grandbaby, and so on."
- DrLefty
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For most retirees, the greatest fear is not death—it is running out of money before they die.

Matt Halperin  |  Aug 6, 2026

"re: but more likely you’ll find a sad story of those actually running out as a result of dementia related fraud/romance cons etc if this is true, (and i am not saying yes or no) it could equally apply to retirees with very large portfolios, and therefore not really be due to a portfolio “failing”. "
- Mark Bergman
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Short term and long term Social Security planning

William Perry  |  Aug 4, 2026

"Interesting question Robert that sent me down a rabbit hole. Using the CMS 271 page report with a transmittal letter of June 9, 2026 titled "THE 2026 ANNUAL REPORT OF THE BOARDS OF TRUSTEES OF THE FEDERAL HOSPITAL INSURANCE AND FEDERAL SUPPLEMENTARY MEDICAL INSURANCE (SMI) TRUST FUNDS" the best answer I can find appears to be that the IRMAA contributions are not broken out from the approximate 22% of total revenues that come from beneficiary premiums. Page 13 reads in part - For SMI, government contributions represent the largest source of income. These contributions covered about 75 percent of program costs in 2025. Also, beneficiaries pay monthly premiums for Parts B and D. Those premiums financed roughly 22 percent of the total cost in 2025... "
- William Perry
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Risk and Taxes

ArticleAdam M. Grossman  |  Aug 8, 2026

AFTER YEARS OF heady gains in the stock market, many investors are facing the same question: To manage risk, they’d like to cut back on one or more of their holdings. But because of the potentially costly tax bill that might result, they aren’t sure exactly how to do that. How can you square this circle? One easy option would be to donate appreciated assets to charity. But that would make sense only if it aligns with your charitable goals and, of course, if you don’t need those funds for other uses. How else could you strike a balance between managing risk and limiting taxes? Here’s how I would answer this question. Step 1. I’d start by estimating the potential risk level among your holdings. While there’s no single litmus test, you could ask the following questions. First, how large a portion of your assets does any single holding represent? As a rule of thumb, I’d focus first on individual stocks that top 5%. Why 5%? My operating assumption is that any individual stock could experience a 50% decline during a crisis. So if a holding is limited to 5%, then a 50% drop would result in an overall portfolio impact of just 2.5%. I see that as very manageable. To be sure, stocks can certainly decline by more than 50%, but I view this as a reasonable figure for risk management. While I worry most about the risk posed by single stocks, it’s also important to examine the overall composition of your portfolio. That’s because, counterintuitively, a portfolio of 30 stocks could end up being riskier than a group of just 10. Harry Markowitz, the father of Modern Portfolio Theory, explained why. In his initial work back in the 1950s, Markowitz used railroad company stocks to explain the concept of diversification. There’s nothing inherently wrong with railroad stocks, Markowitz explained. But if a portfolio consists of only railroad stocks, then that would be a problem—because companies in the same industry are often impacted by the same economic factors. In other words, a portfolio consisting of a large number of holdings might only appear diversified, so it’s important to look under the hood. Another risk factor to consider: Do you work for a public company and own the company’s stock? If so, that would be a reason to consider diversifying more quickly (within the permitted time windows). What if you own only mutual funds or ETFs? Diversified funds tend to be less risky than individual stocks, but that’s not always the case. The fund industry launches as many as 1,000 new funds each year, including many with very aggressive strategies. So it’s important to check each fund’s holdings. You can find that information on the fund company’s website or on a site like Morningstar (Here, for example, are the top holdings in Vanguard’s S&P 500 index fund). Step 2. Next, you’d want to estimate how much a loss might impact you. As with most questions in personal finance, there are two answers to consider: how it might affect you in dollar terms, and the degree to which a loss would simply be upsetting. Both are important. Step 3. If you determine the holding in question does represent a material risk, then you’d want to estimate the potential tax impact. Here are questions you might ask: What would the tax be if you exited the entire position? Would it push your income into the next capital gains bracket? Are there tax lots with less appreciation you could take advantage of? Do you have losses you could use to offset some of the gains? Do you expect to be in a higher or lower tax bracket next year? Step 4. If you conclude that the tax bill might be significant, what steps could you take to reduce a holding tax-efficiently? Here are strategies to consider: For starters, I suggest deciding on a target percentage for the holding. While ideally I prefer bringing any individual stock down to a 5% weighting, that figure isn’t a rule. All things being equal, the larger a portfolio, the more risk you can afford. After deciding on a target percentage, the simplest approach would be to set up a long-term sale plan—like dollar cost averaging but in reverse. Suppose you’d like to sell 1,200 shares of a given stock. You could sell 100 shares each month for twelve months. You’d do that regardless of whether the stock happens to be up or down that month. That 12-month schedule isn’t a rule. If your holding is very significant, you might opt for a longer timeframe. On the other hand, if you feel the stock has a particularly highflying valuation, you might choose a quicker pace. The key, in my view, is just to get started. As the writer Carveth Read wrote, “it’s better to be roughly right than precisely wrong.” Selling a stock down over time is the simplest way to reduce risk, but it’s hardly the most tax efficient. Another approach that’s been gaining in popularity is known as a 351 exchange fund. With a 351, the idea is that a group of investors, each with their own portfolios of appreciated securities, come together and collaborate to diversify their respective holdings. To provide a simplified illustration, imagine two investors, each with a concentrated holding, one in Microsoft and the other in Apple. Each would benefit by diversifying, and that’s what a 351 exchange fund allows. Each would contribute their respective shares into a common pool that would then hold some Apple and some Microsoft. This new investment would be structured as an ETF, and each investor would be issued shares proportional to the size of their contribution. Importantly, the initial creation of a 351 fund doesn’t entail any tax. Taxes are due only when an investor later sells shares of that ETF. This is a simplified example. In reality, a 351 exchange fund would hold many more than just two holdings. They’re actually required to meet various diversification requirements. As a result, investors in 351 funds may end up feeling sufficiently diversified and thus comfortable holding their fund shares for the long term. That would make this strategy potentially the most tax-efficient way to manage portfolio concentration risk. This is just an overview, though. If you’re interested in 351 strategies, I suggest further research. In July, The Wall Street Journal discussed these funds in some detail. In addition, a firm called Alpha Architect, the largest player in this area, has a number of helpful explanatory videos on its site.   Adam M. Grossman is the founder of Mayport, a fixed-fee wealth management firm. Sign up for Adam's Daily Ideas email, follow him on X @AdamMGrossman and check out his earlier articles.
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Manifesto

Aug 9, 2026

NO. 71: WE SHOULD take a broad view of our bond holdings—and include our paycheck, Social Security and other bond-like income streams. Result? We may find we have too much in bonds.

Truths

Aug 11, 2026

NO. 33: MOST INVESTORS trail the market averages. That’s true whether a market is considered efficient or inefficient. Before investment costs, we collectively earn the results of the market averages. After costs, we must inevitably earn less. In fact, investors—as a group—will trail the market by a sum equal to the investment costs they incur.

act

Aug 10, 2026

KEEP ENOUGH in cash investments to give yourself a sense of security. It’s tempting to invest as much as possible for long-term growth. But research suggests putting perhaps $5,000 in a savings account or a money market fund can greatly improve our sense of financial wellbeing. If your emergency fund isn’t that large, consider stockpiling some cash.

think

Aug 10, 2026

ENDOWMENT EFFECT. We prize the items we own. We might believe our homes are worth more than they really are and our investments have performed better than they have, making us reluctant to sell. We might also hang on to investments we inherited from our parents, because we endow them with meaning beyond their actual value.

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Manifesto

Aug 9, 2026

NO. 71: WE SHOULD take a broad view of our bond holdings—and include our paycheck, Social Security and other bond-like income streams. Result? We may find we have too much in bonds.

Spotlight: Saving

IRS 2026 Updates

Bogdan Sheremeta   |  Nov 15, 2025

SECTION 415(D) OF the IRC requires the Secretary of the Treasury (IRS) to annually adjust limitations for cost-of-living increases. So, let’s dive into some of the changes:
 
401(k), 403(b), and Most 457 Plans:

For 2026, the 401(k)/403(b)/457(b) amount you can contribute is increasing from $23,500 to $24,500. If you are in a 24% marginal tax rate, that’s an additional $240 of federal taxes you can defer. If you are over age 50, the catch-up contributions are also increasing by $500,

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Trump Accounts

Adam M. Grossman   |  Jul 11, 2026

INNOVATION IN THE world of retirement plans is decidedly slow moving. But as of July 4th, investors now have a new savings option known as a Trump account. In short, these are retirement accounts designed specifically for children.
Trump accounts share some similarities with traditional individual retirement accounts (IRAs), but there are also key differences. If you have children, grandchildren, nieces or nephews, this new option may be worth exploring.
Who is eligible for a Trump account?

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Change is good – and profitable

R Quinn   |  Apr 12, 2025

For more years than I remember I have saved my pocket change. Every day I put it in a tray on my dresser. When it overflows, Connie bags it and eventually rolls it for deposit. That happens at around $80.00.
I never pass a penny on the ground. In fact, on occasion I dig one out of the soft tar. Some coins are so mangled it’s hard to tell what they are at first. Sometimes people stare at me,

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No Time Left for Calculating My Net Worth

Dan Smith   |  Jun 14, 2025

Oh my, I’m beginning to think that some of the articles I find on the internet aren’t really news at all. Below is one I clicked on today. It reminds me of those free dinners that Mike Flack recently posted about. I also think it ties in well with Dave Lancaster’s post about calculating net worth. 
The article didn’t define how it calculated net worth. I assume it includes checking and savings, IRAs and similar accounts,

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Planting Bad Seeds

Ken Cutler   |  Jul 31, 2023

WHEN I WAS A YOUNG engineer, I supervised a charismatic worker named Neil, who was a sort of pied piper to the younger engineers and technicians in our group. He was about 20 years older than us and loved to dispense advice like a guru.
His quirky advice usually had a financial component. For example, he recommended that we single guys marry women with curly hair, as that would save tens of thousands of dollars over the course of the marriage,

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Social Security

Adam M. Grossman   |  Aug 1, 2026

AT FIRST GLANCE, Social Security appears straightforward. During our working years, we pay into it, and in retirement, it sends us a monthly check, guaranteed for life. Unfortunately, it isn’t always so simple. Below are five aspects of the system that are frequently misunderstood.
Benefits estimates. Look at a Social Security statement, and an easy-to-read chart provides estimates of the benefits available at various ages. The heading above the chart reads, “Personalized Monthly Retirement Benefit Estimates Depending on the Age You Start.” That seems clear.

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Spotlight: Grossman

A World of Problems

Adam M. Grossman   |  May 17, 2020

WITH EVERYTHING that’s been going on recently, one story that’s received less attention is the ongoing spat between the White House and the board of the Thrift Savings Plan (TSP). As of a few days ago, there had been a ceasefire in the debate, but it isn’t over. It’s worth understanding what’s at stake—because the underlying issue has been a recurring theme in the investment industry. If you aren’t familiar with the TSP, it’s one of the retirement plans available to federal government workers. In lots of ways, it's similar to a private sector 401(k). It allows employees to contribute part of each paycheck. The government also makes contributions. Employees can choose from a menu of investment options. The current debate centers on a proposed change to one of those investment options, called the I Fund, which—as you might guess—invests in international stocks. Currently, the I Fund tracks the MSCI Europe, Australasia and Far East index. But a few years ago, the TSP proposed shifting to a new index called MSCI ACWI ex USA Investable Market index. While these names might sound similar, there’s a big difference: The old index was limited to major developed economies, including France, Germany, Japan and Australia. Meanwhile, the new index also includes stocks from 26 emerging markets countries, including Russia, Indonesia and China. To implement this change, the I Fund would have to sell a substantial share of its existing developed markets holdings so it could purchase these new emerging markets holdings. As you might imagine, it’s the addition of China that the administration opposes. But from an investor’s perspective, this is about more than politics. To be sure, I don't love the Beijing government and that’s a valid reason to oppose this change. Opposition, in fact, has been bipartisan. But the concern I want to address here…
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Leaving on Bad Terms

Adam M. Grossman   |  Sep 12, 2021

I HAVE A RELATIVE—let’s call her Jane. Last year, in the early days of the pandemic, Jane had the foresight to buy shares in vaccine maker Moderna. With the benefit of hindsight, it was a smart decision. But it wasn’t a difficult one, in Jane's view. It was no secret that the company was working on a COVID-19 vaccine. It was also clear that vaccines would be in high demand. That made the investment case clear. Jane was right. Since then, Moderna’s shares have risen tenfold. This year, it’s been the single best-performing stock in the S&P 500. Jane is a happy investor—but she also has a problem: Deciding when to sell has turned out to be much tougher than deciding to buy. She could, of course, sell now and declare victory. Who wouldn’t be happy with a tenfold gain? But then again, that might be premature. Moderna has lots of other drugs in its pipeline and might be just getting started. To be sure, this is a good problem to have. Still, it isn’t an easy decision—and it turns out that Jane isn’t alone. According to a recent paper titled “Selling Fast and Buying Slow,” professional investors struggle with the same issue. That is, they struggle more with selling than buying. The paper’s researchers selected a group of more than 700 large, professionally managed portfolios, each averaging nearly $600 million. These included pensions, university endowments and the like. Then they examined the trades in these portfolios over a 16-year period. What they found was surprising. First, despite the mantra—and the data—that “active management underperforms,” the data revealed that active managers actually display significant skill when buying. The average stock they purchased went on to outperform by more than one percentage point over the next year. While that might not sound like a lot, consistent…
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Say No to Mo

Adam M. Grossman   |  Jul 7, 2019

A FEW WEEKS BACK, a reader—let’s call him Karl—challenged me with a question. Why, he asked, don’t I recommend momentum investment strategies? If you aren’t familiar with the term, momentum strategies seek to buy stocks that have done well in the past, with the hope that they will continue rising, while also selling stocks that have done poorly, with the expectation that they will keep falling. Karl asked why, in a recent article, I had dismissed momentum investing as the sort of thing that would turn your portfolio into an “unpredictable stew,” even though research has found that it can be profitable. It’s a fair question. Karl is right that there’s lots of evidence to support momentum strategies. The most commonly cited paper was published in 1993. Since then, many other academics and practitioners have confirmed that it does indeed pay to buy stocks that have been going up and to sell those that have been tumbling. In fact, there’s enough data to conclude that this really isn’t an open question anymore. Momentum definitely works. And it’s not limited just to stocks. Momentum also works with bonds, commodities and other types of investments. Indeed, it’s a remarkably durable feature of investment markets. One paper found evidence of momentum going all the way back to 1801. And yet, despite all this research, I still don’t recommend momentum strategies. Reason No. 1: Costs. Momentum trades don’t last forever. In the 1993 paper referenced above, the authors found that the optimal holding period was just six months. If you want to jump on the bandwagon when a stock is going up, you have to move fast. You can’t wait too long to buy—and you also can’t wait too long to sell. If you do, there’s a high price to pay: After that six-month holding period, momentum tends to reverse and you…
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Moving Target

Adam M. Grossman   |  Mar 3, 2019

LAST MONTH, The Wall Street Journal ran an article with a puzzling headline: “How China Pressured MSCI to Add Its Market to Major Benchmark.” Like a lot of market news, this arcane-sounding story came and went without much notice. But it’s worth pausing to understand what it was all about—and why it matters to you. First, let's decode the terminology in the article's headline: A “benchmark” is another word for an index. It’s simply a list of stocks or other investments. Probably the best known indexes are the Dow Jones Industrial Average and the S&P 500, but there are many others. Who is MSCI? While less known than its competitors Dow Jones and Standard & Poor’s, MSCI is a major player in the index business. They have created thousands of indexes. Last year, the business generated more than $800 million in revenue. While MSCI's name is not well known, it’s an influential company. Thousands of index funds are built on its indexes. As a result, when MSCI adds a stock to one of its indexes, some funds are compelled to buy that new stock and this often drives up the share price. Ordinarily, index providers receive little attention, instead operating quietly in the background. They move methodically and make changes to the composition of indexes only incrementally. In its most recent update, for example, the S&P 500 replaced just one stock out of 500. But every once in a while, an index provider does something surprising. In the most recent case, according to the Journal, MSCI succumbed to pressure from China's government to make sweeping changes to one of its best known indexes. China apparently requested that MSCI add more Chinese stocks to its Emerging Markets Index—an index to which trillions of dollars of index funds are linked. This “request” was accompanied by…
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Staying Rich

Adam M. Grossman   |  Jul 24, 2022

WHEN HE DIED IN 1877, Cornelius “Commodore” Vanderbilt was by far the wealthiest American, with a fortune of $100 million. In the 10 years after his death, his son William succeeded in further doubling those assets. It was an astonishing level of wealth. But that’s precisely when things began to turn. One of Cornelius’s grandsons built the 125,000-square-foot Breakers mansion in Newport. Another commissioned Biltmore in North Carolina, which is still the largest home in America. And, of course, the family endowed Vanderbilt University. The result: Just 50 years after Cornelius’s death, the family’s wealth was essentially gone. Just as lottery winners and professional athletes often end up cursed by their own wealth, so too were the Vanderbilts. Receiving a windfall, it turns out, can be a double-edged sword, no matter how large it is. If you’ve received a windfall—or are planning to leave one to your heirs—below are six recommendations to help avoid the fate of the Vanderbilts. 1. Sketch a plan. A common piece of advice for those receiving a windfall: Avoid taking action too quickly. That’s a good recommendation, but I think it’s also incomplete. It doesn’t tell you when it’s safe to take action or what to do. That’s why I would start by sketching out a plan—with the emphasis on sketching. It’s difficult to formulate the right plan on the first try. It takes time, and there’s no way to force it. Instead, the only way to zero in on the plan that’ll work best for you is to begin with some incremental actions. If you’re thinking of making gifts to charity or to family, for example, start with just a few small gifts. Whatever you have in mind, see if there’s a way to take some half-steps. This will allow you to see what works and what doesn’t, and then adjust.…
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Navigating the Unknowns of Financial Decisions

Adam M. Grossman   |  Sep 13, 2025

WHEN IT COMES to financial decisions, there are, as I've argued before, two answers to every question: what the calculator says, and how you feel about it. There’s a fly in the ointment, though: Calculator answers might appear to be based in logic, but they’re still imperfect. Why? Ian Wilson, a former executive at General Electric, explained it this way: “No amount of sophistication is going to allay the fact that all knowledge is about the past, and all decisions are about the future.” In the absence of a crystal ball, in other words, even the most seemingly rigorous answer to any question will contain a kernel, if not more, of uncertainty. Consider the question of how to establish an asset allocation. Most people’s first step would be to consult historical data, reviewing past returns for each asset class. That makes sense, and this is certainly how I approach it myself. The challenge, though, is that historical numbers will never be able to perfectly predict the future. At best, they’re a guide, suggesting where things might go.  I mentioned recently, for example, investors’ experience in Japan’s stock market. During the 1980s, Japan’s economy boomed. But after peaking in 1989, the Nikkei Index went into a multi-decade slump, recovering only last year, after a long, 34-year slump. It’s doubtful, though, that even the most pessimistic observer could have predicted that result. Such is the difficulty of using historical data. We can’t fully rely on it. And yet, despite its inherent weakness, we also can’t ignore it. Fortunately, there are ways to square this circle. To see how, we can examine four common financial questions. Budgeting Suppose you’re building a retirement plan and trying to estimate your annual expenses. You could do the math, and that’s certainly a good starting point. But…
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