tag:blogger.com,1999:blog-274197762024-09-08T23:30:49.647-07:00A personal journal documenting the path from financial freedom to true wealth. This blog explores what to do AFTER making the first million.Rags 2 Richeshttp://www.blogger.com/profile/07322791231190966685noreply@blogger.comBlogger44125tag:blogger.com,1999:blog-27419776.post-46724562773962254852007-04-10T15:20:00.000-07:002007-04-10T15:37:07.628-07:00

I've entered in all of my major numbers from 2006 into Turbo Tax. My tax bill for 2006, including federal and state, will be roughly $200 K. This is a huge number, but I am absolutely thrilled.I was mentally expecting a $600 - 700 K tax bill, due to the gross proceeds totals on my 1099's. I was saved by the AMT cost basis on my sales of company ISOs. Because of the AMT cost basis, my effective

Rags 2 Richeshttp://www.blogger.com/profile/07322791231190966685noreply@blogger.com47tag:blogger.com,1999:blog-27419776.post-60884069206066383012007-04-01T09:06:00.000-07:002007-04-01T12:02:08.589-07:00

I've commented a few times about how correlation between asset classes (international vs domestic market, commodities vs overall market) has risen in recent years. I see a couple of decent articles on this topic:http://www.ssga.com/library/resh/ericbrandhortsinternationaldiversification71502/page.htmlThere is good data in this article, but I'm not sure I agree with all of the author's conclusions

Rags 2 Richeshttp://www.blogger.com/profile/07322791231190966685noreply@blogger.com0tag:blogger.com,1999:blog-27419776.post-90501543357268966822007-03-30T23:16:00.000-07:002007-03-30T23:38:51.591-07:00

Remember when I started looking for an advisor many months ago before I got buried in my job? I kicked my search back into high gear today by making appts with financial advisors over the next couple of weeks. For kicks, I'm throwing in a couple of interviews with high net-worth advisors highlighted in Barrons' most recent Top 100 list. I'll have a little fun with this, and see for myself if a "

Rags 2 Richeshttp://www.blogger.com/profile/07322791231190966685noreply@blogger.com8tag:blogger.com,1999:blog-27419776.post-25981671867705644682007-03-30T00:24:00.000-07:002007-03-30T00:56:56.844-07:00

I spent an afternoon last week reviewing my uncle's finances. He is about to retire in a couple of years. I had gifted him some stock a few years ago which we finally sold last year, so I wanted to make sure everything was in order for his tax filing.The cost basis of the gift stock was essentially zero, but I found that he didn't have to pay any capital gains tax at all because he had

Rags 2 Richeshttp://www.blogger.com/profile/07322791231190966685noreply@blogger.com2tag:blogger.com,1999:blog-27419776.post-18923357958153106212007-03-29T11:24:00.000-07:002007-03-29T11:27:15.736-07:00

I don't mean to turn this blog into a trading diary, but I just covered half my short positions. We're not oversold yet, but after putting out a sizeable short position last week and watching the market trend down for 5 days, I didn't want to be greedy.We will probably be in oversold territory next week.I see some comments I haven't responded to. Will get to them later today, I'm late for

Rags 2 Richeshttp://www.blogger.com/profile/07322791231190966685noreply@blogger.com2tag:blogger.com,1999:blog-27419776.post-55502372759594360062007-03-27T11:10:00.000-07:002007-03-27T11:30:22.604-07:00

I had a 100K 6.45% CD mature today, so I took a trip to my bank to deposit the proceeds. Since I do all of my regular banking transactions on-line, whenever I go into a branch office, it is invariably for a transaction involving a large dollar amount. I get the same predictable comments every single time. For withdrawals or wire transfers:"Congratulations, buying a home?"For deposits:"Getting

Rags 2 Richeshttp://www.blogger.com/profile/07322791231190966685noreply@blogger.com9tag:blogger.com,1999:blog-27419776.post-37844592958852400212007-03-27T09:30:00.000-07:002007-03-27T10:27:36.265-07:00

I read a blog entry today by Cramer that I couldn't agree with more. It's the reason that in my earlier blog entries, I couldn't find safe yield for my cash. He writes:"Everything's a bubble. Mortgages? Bubble. Private equity? Bubble. Buybacks that lever companies? Bubble. Copper? Bubble. Corn? Bubble. Farm land? Bubble. Ethanol? Bubble. Solar? Bubble. Tech without earnings? Bubble. Office real

Rags 2 Richeshttp://www.blogger.com/profile/07322791231190966685noreply@blogger.com5tag:blogger.com,1999:blog-27419776.post-72196686643997893612007-03-26T08:23:00.000-07:002007-03-27T11:42:01.578-07:00

So far, I haven't written anything about charity since I view it to be a very personal issue. But since this blog is anonymous and nobody reads it anyway, I'll talk about charity and what I think about it. I think charity is important, but it's up to all of us to make our own personal choices about charity.I remember my first experience with charity, my school was collecting donations to feed the

Rags 2 Richeshttp://www.blogger.com/profile/07322791231190966685noreply@blogger.com1tag:blogger.com,1999:blog-27419776.post-3275765485876552352007-03-26T07:35:00.000-07:002007-03-26T07:41:38.254-07:00

OK, I'm sure I've doomed myself by claiming a luck streak, but how amazing is that? One trading day after raising the highest % of cash in years in my brokerage account, and shorting DIA/QQQQ, we get a down 100+ day so far.I'm not really into day-trading, so I don't plan on covering anything yet. Will wait patiently for bigger gains. At least till the 10-day average oscillator swings back into

Rags 2 Richeshttp://www.blogger.com/profile/07322791231190966685noreply@blogger.com0tag:blogger.com,1999:blog-27419776.post-51679443037032378752007-03-26T01:12:00.000-07:002007-03-27T10:36:00.299-07:00

I've been meaning to post a history of critical decisions in my financial life. I saw Frugal Zeitgeist's history at http://frugalzeitgeist.blogspot.com/2007/03/stupid-things-i-have-done.html and decided to follow the same format.Age 12: Orphaned as a child, I had to start working at age 12 to support myself. I learned about minimum wage, sweatshops, and standing on your own two feet. Didn't learn

Rags 2 Richeshttp://www.blogger.com/profile/07322791231190966685noreply@blogger.com4tag:blogger.com,1999:blog-27419776.post-45500802706729118482007-03-22T11:58:00.000-07:002007-03-22T12:44:49.582-07:00

The market didn't tumble from profit-taking today. I felt strangely out of sync with the market as I sold off anything that wasn't bolted down today. I'm up to 25-30% cash from 10% in my diversified stock portfolio (I was at 15-20% cash before buying into the market ~3 wks ago). This is my highest cash position in years in this account. What's everyone else doing? It doesn't seem like there are

Rags 2 Richeshttp://www.blogger.com/profile/07322791231190966685noreply@blogger.com0tag:blogger.com,1999:blog-27419776.post-14509384485768908332007-03-21T23:33:00.000-07:002007-03-30T01:16:34.896-07:00

After requesting a leave of absence 8 months ago, my company finally let me start it. Today was the first workday since age 12 that I didn't work (other than weekends, holidays, and vacations of course).What was the first thing I did? I went out and bought a monthly planner/journal. I've never owned one before. After detoxifying for the next few weeks by doing nothing, I want to make sure I don't

Rags 2 Richeshttp://www.blogger.com/profile/07322791231190966685noreply@blogger.com2tag:blogger.com,1999:blog-27419776.post-44253176300724295022007-03-21T23:14:00.000-07:002007-03-22T01:00:47.474-07:00

Wow, I did not expect the big stock market ramp today, so it warranted a review of my stock holdings at the end of the day. Thanks to some lucky side trades around my core positions during the volatility of the last few weeks, I'm back at all time highs in my diversified stock portfolio. All the recent fear-mongering over subprime amounted to much ado about nothing (for now). Looks like a golden

Rags 2 Richeshttp://www.blogger.com/profile/07322791231190966685noreply@blogger.com0tag:blogger.com,1999:blog-27419776.post-60197837782153391922007-03-08T00:00:00.000-08:002007-03-10T09:11:56.553-08:00

People often wonder how other people get rich. There aren't any secrets to becoming rich, you can get rich doing anything, even if you have no business sense or entrepeneurial spirit. You just need to make choices to give yourself the opportunity to be rich.Recently, I've seen two examples of just such a choice. Let's call them Candy and Samantha (I changed their names, but they are real people).

Rags 2 Richeshttp://www.blogger.com/profile/07322791231190966685noreply@blogger.com4tag:blogger.com,1999:blog-27419776.post-88517382028598512602007-02-28T21:10:00.000-08:002007-02-28T22:32:02.383-08:00

After months and months of smooth sailing on the markets, we finally got a little test yesterday with the Dow falling 546 points at one point.I don't receive CNBC-TV, but I don't sense any fear in the air. The market simply corrected a bit from a massive months-long run-up. Unlike other big corrections over the past 10 years, this one generated almost no water cooler talk. My co-workers didn't

Rags 2 Richeshttp://www.blogger.com/profile/07322791231190966685noreply@blogger.com6tag:blogger.com,1999:blog-27419776.post-1165556880587428412006-12-07T21:39:00.000-08:002006-12-08T07:17:07.643-08:00

Out of curiosity, I went back and cleaned up my networth spreadsheet for the last few years. I'm including the most recent 6 months below. Performance has been outstanding, to the point that I lost what little sense of urgency I had in interviewing financial advisors. I will get back to interviewing in the next few weeks.The main (only?) move I've been making is further diversifying out of my

Rags 2 Richeshttp://www.blogger.com/profile/07322791231190966685noreply@blogger.com5tag:blogger.com,1999:blog-27419776.post-1165555809889567172006-12-07T21:20:00.000-08:002006-12-07T21:30:09.900-08:00

Interested in how rich people allocate their assets? Just check out the 2005 detailed personal financial disclosures of the richest Congressmen:http://www.opensecrets.org/pfds/overview.asp?type=W&cycle=2005&filter=AAlso, it's interesting to compare these disclosures against earlier years. Many Congressmen have doubled or tripled their net worth in the last 3 years thanks to booming stock

Rags 2 Richeshttp://www.blogger.com/profile/07322791231190966685noreply@blogger.com0tag:blogger.com,1999:blog-27419776.post-1162398663903784592006-11-01T07:45:00.000-08:002006-11-01T08:31:04.330-08:00

A friend of mine has most of his assets with a private wealth management group at a large financial services institution. I have no idea how much my friend is worth, but I do know that the minimum account size at this private wealth group is $25 million, and that they have managed his money for 8+ years.A few months ago, The India Fund (IFN) announced a rights offering for current shareholders.

Rags 2 Richeshttp://www.blogger.com/profile/07322791231190966685noreply@blogger.com4tag:blogger.com,1999:blog-27419776.post-1160839935914757412006-10-14T08:17:00.000-07:002006-10-14T13:14:13.440-07:00

Additional questions to ask financial advisor:1. What is the highest yield offered on money market-like instruments? (needs to beat CPI after tax)2. What is the (lowest discounted) fee for equity and income assets for a $1M portfolio?3. What are your views on MPT?4. How many accounts are you currently managing?5. What do you have to offer vs XXX financial institution, or vs XXX group within your

Rags 2 Richeshttp://www.blogger.com/profile/07322791231190966685noreply@blogger.com3tag:blogger.com,1999:blog-27419776.post-1160838974609821212006-10-14T08:10:00.000-07:002006-10-14T09:51:30.820-07:00

I haven't documented my networth since my May posting. So here's a quick update:This simple little chart actually took a while to generate, because there is too much going on between the lines. I'm happy to be reorganizing my finances, because it just shouldn't be that complicated.Some things going on between the lines:1) Company stock shows $3M from May to Oct, which suggests I had no gains. But

Rags 2 Richeshttp://www.blogger.com/profile/07322791231190966685noreply@blogger.com0tag:blogger.com,1999:blog-27419776.post-1160837677326401492006-10-14T07:51:00.000-07:002006-10-14T07:54:37.330-07:00

I'll briefly go over the basic concepts of the Wealth Allocation Framework, and refer you to Ashvin Chhabra's "Beyond Markowitz: A Comprehensive Wealth Allocation Framework for Individual Investors" for details.The reason the Wealth Allocation Framework appeals to me is because while reading the article, I realized that I had already started implementing this framework. The article formalized the

Rags 2 Richeshttp://www.blogger.com/profile/07322791231190966685noreply@blogger.com3tag:blogger.com,1999:blog-27419776.post-1160723089621538202006-10-12T23:15:00.000-07:002006-10-13T00:07:17.100-07:00

I had a follow-up meeting with Merrill Lynch and found this meeting to be very informative.In the past, I have been uncomfortable with asset allocation, because asset allocation goes hand in hand with diversification. And diversification is a means for preserving wealth or for growing it slowly. No one will get rich with diversification in a 20 yr timeframe.Although I have sold most of my company

Rags 2 Richeshttp://www.blogger.com/profile/07322791231190966685noreply@blogger.com4tag:blogger.com,1999:blog-27419776.post-1158248280833252522006-09-14T08:36:00.001-07:002006-09-14T08:38:00.846-07:00

The only reason I was looking for alternative investments when I started blogging is that I couldn't find any good investments with decent yield.The environment has changed quite a bit in just a few months. For one thing, I found a 7-month CD yielding 6.45% at a local credit union, so I put 100K into it. I would have put a lot more into it, but didn't because of the 100K FDIC limitation.I put 50K

Rags 2 Richeshttp://www.blogger.com/profile/07322791231190966685noreply@blogger.com2tag:blogger.com,1999:blog-27419776.post-1158248103661681302006-09-14T08:34:00.000-07:002006-09-15T19:13:46.100-07:00

I came across a blog I found interesting:http://uhnwi.livejournal.comHe discusses some topics I wish I had exposure to several years ago.But I'm practically screaming, "Are you crazy?!! Sell, sell, sell!!!!!!"I guess the author probably has ~$30 million or more concentrated in company options, and doesn't want to sell because of capital gains taxes. For some reason, he seems to think his company

Rags 2 Richeshttp://www.blogger.com/profile/07322791231190966685noreply@blogger.com3tag:blogger.com,1999:blog-27419776.post-1157219304851367392006-09-02T09:27:00.000-07:002006-09-02T10:48:24.976-07:00

Has anyone seen "My Date with Drew"? I thought it was a cool movie, shows how someone can achieve what seems to be impossible on nothing but desire and tenacity.I spent over an hour interviewing a financial advisor from Merrill Lynch's private client group. The goal of the meeting was to find out what Merrill could do for me, and his proposal for financial strategy.I had given him a list of some

Rags 2 Richeshttp://www.blogger.com/profile/07322791231190966685noreply@blogger.com50