What Are You Doing With Your Money?

[Rogar]

I'm following a program similar to Iris'.

I'm slowly rewiring my brain to accept that I can actually spend money without angst. I'm no longer dithering about hiring other people or procuring equipment to simplify my life, buy-back my own time, and eliminate bother - I've only got a few decades left, and I'd rather spend my time on more engaging activities than home repair.

Basically, ditto. When I was doing my early retirement planning I did a rough forecast of expenses and income for different financial returns on investments. I actually don't know how much it helped, but since I left employment during the last big financial meltdown I've had years of frugality, but decent returns. I now have enough of a nest egg for most long term care possibilities, although that's sort of a wild card, and have enough left over after normal expenses to afford hiring people for most home repairs, etc and still make charitable donations. I'm thinking on donating all of my 2026 IRA withdrawal to a favorite non-profit or two.

Trump has cut or threatened to cut multiple environmental, water supply, social service programs and business development projects in my state as part of his revenge tour. Meantime squanders away useless billions on the military. I hope to minimize federal taxes as much as legally allowed without regret. Donating IRA withdrawals is one small way. Donating to non-political non-profits is another way to resist like the ACLU. Not mine but I do have some similar choices. Maybe it was mentioned, but you can donate to many qualified non-profits, so it could include a variety of issues.l

[Tybee]

What I am working on is looking at all of my resources as one unified portfolio, since I have had a few different sources of money and I tend to treat them very differently. So I am trying to put together the big picture as to how much is in which instrument, and how I structure things. I wonder about Roth conversions but years ago Schwab told me it didn't make sense for me, now they are telling me it makes sense, so am pondering that.

My portfolio is probably about 50% fixed and cash, 50% etfs and individual stocks but I need to look at this, too, because I have been looking at the portfolios separately, and not as one unified whole. I can't bring myself to go all in in index funds and not stocks but I am trying to simplify, and probably by the time I die, will have more in index funds and less in individual stocks. I think a lot about what my kids could inherit and try to arrange things well for that. We may sell this house and get something simpler in a better for us location, and that will exhaust some of my cash. Which I am not crazy about. I can't see us becoming renters unless it's a long term care situation like independent apartment somewhere.

I also started a DAF and love it, so that has been really successful for me. I put a certain amount in there to start and then tithe on any money I earn and spend it down to a certain number, then wait for it to get up to above that number and grant it somewhere. It really works for me.

[Tradd]

Just for context, I'm single, no kids, and 56. I have more than enough to save. I've got $17K for savings currently. I keep $5K in the savings account connected to my Chase checking account. I want easily accessible cash if needed. I have a HYSA with Vanguard (Cash Plus account) with the remaining $12K. I have a traditional IRA (rollover 401K from a job 20+ years ago) with Vanguard. I've never added anything more to it, just let it grow. It's in a target date fund. I also have a Vanguard brokerage account with a couple hundred in VOO (S&P 500). I also have a 401K with current company, also in a target date fund.

I have been stuffing 401K, but I reduced contribution a bit so I'd have more to put into savings. I feel the need for cash currently. My only debt is a car loan on my 2024 Crosstrek.

My goddaughter is set to get everything, except one account, which my church is beneficiary for. Yes, I have a will in progress, almost done.

I rent. It's too expensive in the Chicago area for me to buy. I've only been making better money the past few years, but I have a low rent and I'll stay as long as I can.

I donate regularly to my church and to a local food pantry, with small amounts to local PBS station and classical radio station.

[iris lilies]

Tybee please talk more about Roth conversions at our age. Or even new Roth – can I make Roth contributions now? You know my stats,: retired, etc.

[frugal-one]

What is DAF?

[Tybee]

DAF is donor advised fund, frugal. So I gave Schwab and opening sum and then I choose to grant money to different charities, and Schwab sends them the money. They approve the grant, then send the money. So the tax part is when I contribute the money, not when they donate it to the charity. Here's the Vanguard version:

Giving with Vanguard Charitable

Vanguard Charitable supports thoughtful, strategic philanthropy. As a donor-advised fund leader since 1997, we have the resources and expertise necessary to help you maximize the benefits and the impact of giving.
Whether you’re looking to donate complex assets, grant for the maximum impact, or anything in between, partner with Vanguard Charitable to ensure that the time you spend on philanthropy is time well spent to reach your goals.

What sets us apart


Lower fees:

• Lower all-in fee ensures your donations make the greatest impact
• Vanguard-backed, at-cost investments
• Tiered fee schedule
• A history of lowering fees over time and passing savings on to you

Flexibility:

• Investments to fit your individual investing style and charitable timeframe,
• Support and options when considering legacy planning
• Optional anonymity when you make a grant
• Easy online account management

Convenience:

• Consolidated charitable giving makes tax time easier
• We take charity due diligence and administrative tasks off your plate
• You have 24/7 access to your account
• Set recurring grant schedules to offer ongoing support

[Tybee]

Iris, you can't make a contribution to a new Roth because you have to earn the money, like from wages. Investment income can't be used.

[frugal-one]

You can convert traditional IRA to a ROTH though. This is beneficial when there is a gap between standard deduction and adjusted income … that money is not taxed. Or beneficial if you are in a low tax rate now and project to be in a higher tax rate later.

[frugal-one]

THANKS FOR THE INFO on DAF, Tybee! Is this the same as Qualified Charitable Contributions? … explained below..

https://legalclarity.org/can-a-qcd-g...-advised-fund/

Other Charitable Giving Options

Individuals interested in both tax-efficient giving from their IRAs and flexible charitable planning have distinct options. They can make direct Qualified Charitable Distributions (QCDs) to eligible public charities. Separately, donors can contribute appreciated stock to a Donor-Advised Fund (DAF) for an immediate income tax deduction. These two strategies can be utilized in parallel, allowing for direct support to charities from an IRA and flexible, long-term charitable planning through a DAF.

[Tybee]

Sure thing, I really like mine!