If the choices are invest and earn < 20% or pay off debt with 20% interest, paying off debt seems pretty obvious

insanepoker,

vixticator has some strange ideas but he's generally a good guy.


waterwolves,

an answer to your friend's question is you can only create so much tax-advantaged space per year, so it is wise to do so when you can. another is that reducing your income, and therefore how much tax you pay, might free up more cash for other goals.

but it sounds like he has bigger problems: 20% vig and pilfering one's 401k are both red flags.

I read that you pay 0% on long-term capital gains if you're in the lowest two tax brackets (under about $36,000 income).

Do any realized capital gains for the year factor into your income in determining your bracket?

In other words, if your only income for the year is capital gains, do you pay nothing on them even if it's greater than that $36k figure?

^

Google search looks like capital gains count as income for figuring this, but I'll leave the post up in case anyone has anything to add.

Considering buying a vending route in my area. Here's some details:

Asking price: $10k
12 machines placed in 6 different locations, 5 more machines unplaced.
Machines serviced 2 times/month. Takes 5-7 hours to service all machines. I would be servicing the machines.
Monthly revenue: $1000-1200
Monthly expenses: $300

Seller claims that all machines work and he has contacts for parts/repair. I asked the seller if he had any financial records, and he said he had none. This is obv. a red flag because it's an all cash business and I'd have to take his word on the numbers.

Based on his numbers, each machine would average $80-100/month. This comes out to about $3/machine/day in revenues. This sounds reasonable to me, but I might be overlooking some things.

Also based on his numbers, yearly profit from the route would be about $8k-10k.

My concerns:
-Don't know if he has written contracts with any locations.
-Don't know if his revenue is true
-Don't know how reliable his contacts are for parts/repair.

Considering the above concerns, whats the most I should be willing the pay? If I were to make an offer, where should I start?

I probably wouldn't touch it if the person is a relative stranger to you. The fact that he has no supporting evidence for his numbers is a deal-breaker imo.

Hope this is an alright spot for this question, but I'm trying to pick health insurance for my new job. The coverage they offer is horrible and I have my choice of a few plans. One is a $2000 deductible plan with the option of an HSA($249/month), $2000/deductible HMO($267/month), and a $1500/deducible HMO($293) month. I've narrowed it down to either of the HMO's. Is the $1500 deductible HMO the obvious choice for an extra $6.50 a week or so pretax?

You would have to go over $1500 once per 19 months for it to be worth it. Your guess is as good as mine, but if you're a reasonably healthy reasonably young person, I'd say it's not worth it.

I own a small retail company that is growing quite rapidly. I'm a one man show for the foreseeable future, currently 240K in sales in my first 8 months, projecting 750K in 2014. I am quitting my job on Dec 27 and this will become my sole focus for 2014. Essentially what I do is buy stuff from manufacturers and traditional retail stores, and resell it online. I am a sole proprietor and will likely get eaten alive at tax time next year. I'm currently strategizing for my 2014 tax outlook.

An idea that I have is to incorporate in a low corporate income tax country while still maintaining my sole proprietorship here in America. So for example, if I buy something for $10, sell it for $20, post-shipping expenses etc $15, so $5 net. I would buy it for $10 using xyz corp in low tax country, that corporation would sell it to my sole proprietorship for $14.50, who would in turn sell it to end-consumer for post-expenses $15.

How difficult will it be the structure my business and profits like this?

So there is a company I'm interested in that is going to have an IPO soon.

I've never owned individual stocks and don't plan to in the future but I really like them and think their business will only get better.

It's http://www.bluebirdgroup.com/ they are an Indonesian taxi company.

Their business model is simple but still radical here: Reliable drivers actually using the taxi meters and not trying to screw their customers.

They have made such an impact, for example all other taxis in Bali are now shades of blue, in hope for tourists to mistake them for a bluebird lol. There is even a "Blue taxi group" and most taxis also have a very similar blue bird as their logo. Still you can see tourists and locals patiently waiting for a real bluebird on the side of the street, passing loads of other taxis (which by no means are ALL rip off artists).

They also have other transport related businesses like rentals, limousines with drivers etc as well as logistics like transporting for 7/11 type shops.

Indonesia is huge and they are in 14 cities so far so def still room to expand with their core business as well.

All of the above is obv public knowledge so will be priced in accordingly, right?
I still want to throw a bit of money at them (and admittedly pretty much regardless of asking price) - is that crazy or probably fine? Won't go broke or anything ofc.

Where' the best place for my emergency fund to be stashed?

I've looked into online savings accounts and I can't work out where the best deal to be had is. Also, would a regular bank savings account be more convenient? (albeit at a lower interest rate). My thinking is interest rates are so low right now it's not going to make much of a difference.

Any help appreciated. Thanks.

generally, emergency funds belong in liquid savings. i use "high interest" online savings but if you don't think that's worth the trouble for a few basis points in interest, that's fine.

here is a site for researching available rates. i'm sure there are others, but bogleheads frequently refer to this one:

http://www.depositaccounts.com/

if you have a large or tiered emergency fund, we can talk about using i bonds or CDs, but those are a (small) level of difficulty above a second savings account.

I use Discover bank and have been extremely pleased with their level of customer service. They currently give .8% for savings and a bit more if you go with a 2+ year CD. .8% isn't going to move the needle, but free money is free money. You can probably find higher rates if you shop around.

The advantage of using a B&M savings account is that you would have access to the money today, whereas it takes 4 business days to transfer from an online account to your B&M checking account (for Discover anyway, I assume others are similar). Assuming you have some money in a checking account for bills etc, there's probably not that many life situations where those 4 days are going to be a major issue. It's well worth keeping it online, IMO.

I have seven term deposit accoutns, each for seven months - so that every month, one matures (and then, since I have had no emergency, auto-reinvests itself).

This is for a couple of reasons:

a) if I have an "emergency" (ie, lose my job etc.) then I am unlikely to need all the money at once, but rather, on an ongoing basis

b) I get a higher interest rate by having them in term deposits rather than ordinary accounts

What rate do you get for 7 months?

My money was in Australian bank accounts, so earning 4.5%-6% over the last 4 years or so.

As it happens, I'm moving it out of Australia to where I live (Isle of Man) because although bank interest is taxable, capital gains are not, so I'm going to find some other place to put it over here.

i can think of no investments that both behave like liquid savings and are subject to capital gains tax.

Tyler,

Isle of Man has some really friendly/different tax laws.

Josem,

Can I use these Australian bank accounts if I'm American (and live in USA)?

I assume so. I have an Australian bank account despite not being an Australian resident currently.

You can certainly get an Australian bank account if you are a US citizen with Australian residency. You can certainly get an Australian bank account if you are an Australian citizen with US residency. Presumably, therefore, you can get an Australian bank account with neither Australian citizenship nor residency.

Large banks will take you; some small banks may deny you (and all other US citizens) due to FACTA regulations, but that's not unique to Australia.

There may also be witholding tax issues, but this is well above my expertise.

What kind of stock valuation technique is mostly used in the industry?

If Discounted Cash Flow is the choice:

• Is CAPM used for discounted rate or should we use WACC?
• How many years is usually used for forecasts?

i want to start my true journey into investing, where do I begin? what is the best introduction, in reality I know very little details, simply some basics and terms.

Here: http://www.bogleheads.org/wiki/Getting_Started

DCF is one of a few widely used methods. CAPM is used to calculate the cost of equity in WACC. Forecast length varies, but usually no more than 5 years. This is the best source for learning valuation on the web: http://people.stern.nyu.edu/adamodar...steqfall13.htm

I have about 100 thousand in a mutual fund. I live in nyc and I'm thinking about using this money to get a route. Is this a good idea? I'm thinking utz. I know nothing about routes but I'm leaning towards it because I don't work and it'll get me out of the house and active during the day

what's a route? why does it cost 100k?