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Portfolio second option - any one use Jon Luskin?

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  • Portfolio second option - any one use Jon Luskin?

    In the past I used Vanguard PAS for all my retirement accounts, last year I pared PAS services back to a single Roth account. I continue to manage the remainder of the accounts myself. I reviewed my costs for 2021 and I paid enough in AUM fees to just get a fee-only second opinion.

    I have long assumed I would use Rick Ferri as I find his general advice very practical. However, he is booked out into 2022.

    He has now recommended to use a young advisor Jon Luskin. https://jonluskin.com

    I have the gut feeling that I could probably manage everything on my own, but I think a second opinion has value.

  • #2
    I’ve never heard of him but I wouldn’t think Rick would recommend people that would reflect badly upon him.

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    • #3
      The most enlightening thing was seeing examples of his work. Very thorough and important stuff but I didn't learn a single new thing, reinforcing that if you're a hobbyist you probably don't need a financial advisor to come up with a plan for you.

      I noticed this though: "If the second feature (in-plan Roth conversions, or in-service distributions) is not available, making non-deductible voluntary after-tax contributions is still worthwhile. "

      Why would non-deductible after-tax contributions be worthwhile if they're going to be taxed at personal income rates rather than capital gains...?

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      • #4
        Originally posted by Turf Doc View Post
        The most enlightening thing was seeing examples of his work. Very thorough and important stuff but I didn't learn a single new thing, reinforcing that if you're a hobbyist you probably don't need a financial advisor to come up with a plan for you.

        I noticed this though: "If the second feature (in-plan Roth conversions, or in-service distributions) is not available, making non-deductible voluntary after-tax contributions is still worthwhile. "

        Why would non-deductible after-tax contributions be worthwhile if they're going to be taxed at personal income rates rather than capital gains...?
        Same contributions to a “taxable” account would be preferable since the gains would eventually be taxed at LTCG rates.

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        • #5
          Originally posted by Larry Ragman View Post

          Same contributions to a “taxable” account would be preferable since the gains would eventually be taxed at LTCG rates.
          That's what i was thinking, so is that just poor advise on Luskin's part? Is there any justification for non-convertible non-deductible after-tax compared to a simple taxable?

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          • #6
            Originally posted by Turf Doc View Post

            That's what i was thinking, so is that just poor advise on Luskin's part? Is there any justification for non-convertible non-deductible after-tax compared to a simple taxable?
            Sure, the rationale would be that the after tax contributions could continue to grow tax deferred if in your 401k/403b etc. Nominally one can run the numbers to calculate if the same contributions to tax deferred then taxed on withdrawal, or held in taxable then eventually subject to LTCG rates comes out ahead. It is the same argument about whether or not to contribute after tax nondeductible funds an IRA. I've already said where I would come down, but Luskin is not being unreasonable.

            Found a WCI link on this: Should You Invest In Variable Annuities and Non-Deductible IRAs? - White Coat Investor
            Last edited by Larry Ragman; 10-08-2021, 07:15 AM.

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            • #7
              While not the focus of the post, these accounts have state dependent asset protection value. How important this could be is an individual call.

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              • #8
                Originally posted by Larry Ragman View Post

                Same contributions to a “taxable” account would be preferable since the gains would eventually be taxed at LTCG rates.
                And get a stepped-up basis at death…
                Our passion is protecting clients and others from predatory and ignorant advisors. Fox & Co CPAs, Fox & Co Wealth Mgmt. 270-247-6087

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                • #9
                  Originally posted by Larry Ragman View Post

                  Sure, the rationale would be that the after tax contributions could continue to grow tax deferred if in your 401k/403b etc. Nominally one can run the numbers to calculate if the same contributions to tax deferred then taxed on withdrawal, or held in taxable then eventually subject to LTCG rates comes out ahead. It is the same argument about whether or not to contribute after tax nondeductible funds an IRA. I've already said where I would come down, but Luskin is not being unreasonable.

                  Found a WCI link on this: Should You Invest In Variable Annuities and Non-Deductible IRAs? - White Coat Investor
                  We’ve discussed this on a prior thread. Personally, I’ve always thought it’s a poor decision. But that’s just me.
                  Our passion is protecting clients and others from predatory and ignorant advisors. Fox & Co CPAs, Fox & Co Wealth Mgmt. 270-247-6087

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                  • #10
                    That's what i was thinking, so is that just poor advise on Luskin's part? Is there any justification for non-convertible non-deductible after-tax compared to a simple taxable?
                    I would imagine he’s seeing value is establishing different tax buckets, given uncertainty in predicting future tax initiatives.

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                    • #11
                      Try David Graham MD for portfolio review

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                      • #12
                        Luskin from website uses 3-4 fund portfolio-probably the Boglehead Portfolio-NO BRAINER

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