I use a Google Voice number for 2FA in all my financial accounts. Making the Google Voice number permanent puts it securely under my control. Learn the Nuts and Bolts I put everything I use to manage my money in a book. My Financial Toolbox guides you to a clear course of action. Read Reviews The post How to Keep a Google Voice Number Permanent for 2FA appeared first on The Finance Buff ..read more

Stop using banks and credit unions for cash savings. Use money market funds and Treasuries for better transparency and fairness. Learn the Nuts and Bolts I put everything I use to manage my money in a book. My Financial Toolbox guides you to a clear course of action. Read Reviews The post Ditch Banks — Go With Money Market Funds and Treasuries appeared first on The Finance Buff ..read more

I met the blogger Frugal Professor last week when he traveled to my area for a family gathering. I learned from his blog post that he earned over $5,000 tax-free by transferring a Roth IRA to Robinhood. That specific promotion has since ended. I knew about the promotion when it was active but I didn’t jump on it. I would’ve done it years ago but not anymore. I stopped chasing these bank and brokerage promotion bonuses. A bank account promotion usually asks you to deposit a minimum sum to a new or existing account and keep the money there for a minimum number of days or months. Sometimes the ac ..read more

I use the free Fidelity retirement planning tool to keep an eye on our current investments relative to our spending. Using that tool revealed two fundamental drivers of financial success in retirement. Good Returns Bad Returns Low Spending OK OK High Spending OK Not OK Although my wife said the two fundamental drivers were only too obvious, the planning tool gives us an idea of how low is low and how high is high. Table of Contents Conventional Retirement Calculator MaxiFi Base Plan and Maximized Plan Discretionary Spending as a Metric Social Security Claiming Strategy Assumptio ..read more

I received an email from Vanguard notifying me of upcoming changes to its fee schedule. The one change that stands out for me is that Vanguard may charge $100 effective July 1 if I transfer an account to another broker unless I have $5 million with Vanguard. I’ve been investing with Vanguard for over 25 years. I have had the feeling from some changes by Vanguard in recent years that I’m not as valued as before. This latest announcement finally pushed me to the inevitable. I submitted a request to transfer my account to Fidelity before the new fee takes effect. If you’re thinking along the same ..read more

I wrote in a previous post Our Experience in Building a Home Over Buying an Existing Home that I built a new home. By coincidence, the final all-in cost of this new home came to about the same as the net proceeds from selling my previous home in California four years ago. That previous home is worth a lot more now. If I take an average of the estimated value from Zillow and Redfin, it’s worth 50% more than my new home. As a house though, the previous home has nothing to compare to the new home. It was a tract house built in the 1960s with 1/3 of the living space of my new home. Successive owne ..read more

The previous post Split-Year Backdoor Roth IRA in FreeTaxUSA, 1st Year dealt with contributing to a Traditional IRA for the previous year and recharacterizing a previous year’s Roth IRA contribution as a Traditional IRA contribution. This post handles the conversion part in FreeTaxUSA. We cover two example scenarios in this post. Here’s the first: You contributed $6,000 to a Traditional IRA for 2022 in 2023. The value increased to $6,200 when you converted it to Roth in 2023. You received a 1099-R form listing this $6,200 Roth conversion. You should’ve already reported the con ..read more

The best way to do a backdoor Roth is to do it “clean” by contributing *for* and converting in the same year — contribute for 2023 in 2023 and convert in 2023, contribute for 2024 in 2024 and convert in 2024, and contribute for 2025 in 2025 and convert in 2025. Don’t split them into two years such as contributing for 2022 in 2023 and converting in 2023 or contributing for 2023 in 2024 and converting in 2024. If you did a “clean” backdoor Roth and you’re using FreeTaxUSA, please follow How to Report Backdoor Roth In FreeTaxUSA (Updated). However, many people didn’t know they shou ..read more

You may have contributed to a Roth IRA and then realized later in the year that you would exceed the income limit. You recharacterized the Roth IRA contribution as a Traditional IRA contribution and converted it to Roth again before the end of the year. Your IRA custodian sent you two 1099-R forms, one for the recharacterization and one for the conversion. This post shows you how to put them into the H&R Block tax software. If you had done the recharacterizing and converting in the following year, you would have to split the tax reporting into two years by following Split-Year Backdoo ..read more

The previous post Split-Year Backdoor Roth in H&R Block, 1st Year dealt with contributing to a Traditional IRA for the previous year and recharacterizing a previous year’s Roth IRA contribution as a Traditional IRA contribution. This post handles the conversion part. We cover two example scenarios. Here’s the first: You contributed $6,000 to a Traditional IRA for 2022 in 2023. The value increased to $6,200 when you converted it to Roth in 2023. You received a 1099-R form listing this $6,200 Roth conversion. You should’ve already reported the contribution part on your 2022 ..read more