Simple Q&A - NISA

[dangocurry]

It's not a lump payment. Just adds to your monthly payment. So if you're regular payment was 1,000 x 12 months, your 増額 maximum would be 388,000 / remaining number of months.

It's only really useful if you weren't able to max some monthly payments during the year - then you can use it to catch up.

Ah, I see. I guess I misunderstood how it works. Makes sense you can't game the whole tsumitate part of it. Thanks for clearing that up!

But you can go with a bonus payment. Set up the minimum payment of 100 yen per month for each security you want to invest in, then setup a bonus payment for the next month that equals 400k - (100 * #securities * #remaining months).

Could you explain more about this? Tried my head to understand it but couldn't understand much about it.

[dangocurry]

Also on completely different note, I have seen people putting their monthly payment of investment on credit card for tsumitate NISA. Has someone done something similar for NISA?

[Zanuhesu]

But you can go with a bonus payment. Set up the minimum payment of 100 yen per month for each security you want to invest in, then setup a bonus payment for the next month that equals 400k - (100 * #securities * #remaining months).

Could you explain more about this? Tried my head to understand it but couldn't understand much about it.

I'll explain with my case, since I only buy E-MAXIS Slim All Country so it makes it easy.

Let's say it's February and you've already put in 32,500 yen in January, but you'd like to bulk sum as much as possible into February. Your current remaining Tsumitate NISA allowance for the year is 367,500 yen. The lowest monthly buy amount is 100 yen. So, going with the above method, you set your monthly buy amount to 100 yen, and then put a bonus payment in February for 366,400 yen (which is your remaining amount - 100 * #securities * #remaining months -> 367500 - (100*11) = 366400 )

Now you've got a huge bonus payment in February that takes up pretty much the rest of your yearly Tsumitate NISA, and every month after that you will automatically buy for 100 yen, using the rest of your Tsumitate NISA allowance.

[dangocurry]

But you can go with a bonus payment. Set up the minimum payment of 100 yen per month for each security you want to invest in, then setup a bonus payment for the next month that equals 400k - (100 * #securities * #remaining months).

Could you explain more about this? Tried my head to understand it but couldn't understand much about it.

I'll explain with my case, since I only buy E-MAXIS Slim All Country so it makes it easy.

Let's say it's February and you've already put in 32,500 yen in January, but you'd like to bulk sum as much as possible into February. Your current remaining Tsumitate NISA allowance for the year is 367,500 yen. The lowest monthly buy amount is 100 yen. So, going with the above method, you set your monthly buy amount to 100 yen, and then put a bonus payment in February for 366,400 yen (which is your remaining amount - 100 * #securities * #remaining months -> 367500 - (100*11) = 366400 )

Now you've got a huge bonus payment in February that takes up pretty much the rest of your yearly Tsumitate NISA, and every month after that you will automatically buy for 100 yen, using the rest of your Tsumitate NISA allowance.

I see, so basically if you have excess cash to completely fill up your yearly limit, you put it earlier to get the gains while making minimum amount purchases the rest of the year to reach the limit.

[dangocurry]

Another simple question maybe!

I opened the NISA and now want to buy some funds in it. Basically will go with everyone's favourite Emaxis slim series and something else if it looks interesting.
Fortunately, I can completely max out the NISA limit in the first buy itself.
I think Adamu linked somewhere on the forum comparing investing in lump sum and doing DCA. Given the market is sitting pretty up, would investing in 1 go should be chosen or doing DCA over couple of months to average out the costs.

I mean there's a risk that the market may go down over next months, so go all in at once or gradually at once?

[beanhead]

I mean there's a risk that the market may go down over next months, so go all in at once or gradually at once?

Quite a tricky one, I think. You have 2 risks:

1) If you put the lump sum in and the price promptly falls the next day you will be kicking yourself.
2) If you spread it out over too long a period then you have an extended time with less than your desired 1.2M invested. So you lose the potential compound interest benefits, long-term.

I think your approach of just splitting into 2 amounts is sensible. The potential 'damage' this way is reduced quite nicely.

[dangocurry]

I mean there's a risk that the market may go down over next months, so go all in at once or gradually at once?

Quite a tricky one, I think. You have 2 risks:

1) If you put the lump sum in and the price promptly falls the next day you will be kicking yourself.
2) If you spread it out over too long a period then you have an extended time with less than your desired 1.2M invested. So you lose the potential compound interest benefits, long-term.

I think your approach of just splitting into 2 amounts is sensible. The potential 'damage' this way is reduced quite nicely.

yeah, been thinking about this lately. I was thinking of putting a major chunk in now and then DCA over the year for rest of the amount.

anyway, another simple question is, those who put the monthly payment of NISA on rakuten credit card, how does it work out in December? As in, I have read that for december, the broker kind of closes the yearly NISA early and hence any transaction after say 3rd week goes into next year's NISA.
How does it work?

[Viralriver]

anyway, another simple question is, those who put the monthly payment of NISA on rakuten credit card, how does it work out in December? As in, I have read that for december, the broker kind of closes the yearly NISA early and hence any transaction after say 3rd week goes into next year's NISA.
How does it work?

This is my first year using the card so I can't comment on experience per se, but the transaction would take place on Dec. 15th, which would be 2021 NISA. I opened my NISA account last year and made my full 400k contribution on Dec. 24th or something crazy like that. So I don't foresee any problems.

[Kanto]

anyway, another simple question is, those who put the monthly payment of NISA on rakuten credit card, how does it work out in December? As in, I have read that for december, the broker kind of closes the yearly NISA early and hence any transaction after say 3rd week goes into next year's NISA.
How does it work?

This is my first year using the card so I can't comment on experience per se, but the transaction would take place on Dec. 15th, which would be 2021 NISA. I opened my NISA account last year and made my full 400k contribution on Dec. 24th or something crazy like that. So I don't foresee any problems.

This is the paper on Lumpsum vs DCA

http://www.smartretirement.com.au/wp- ... raging.pdf

.....

Last of 2020 NISA

約定日 受渡日 ▼
2020/11/25 2020/12/01

First of 2021 NISA

引落日は2020年12月14日
積立予定日 2020年12月24日

[garystri]

Probably answering my own question here but...

My first NISA 3 years ago was a regular and I filled it up no problem. I anticipated being unable to fill the next year and switched to Tsumitate for 2 years, bought a house got married etc lol.

Now this year I probably will be able to fill my Tsumitate before my summer bonus and I am trying to decide if I should switch back to a regular one next year.

I am planning on investing most of my bonuses into a tokutei account when this year's Tsumitate fills then next January sell enough of my current assets to fill(swap) into the NISA. Is this the best plan?

Also second question, I want to get rid of some things in my first NISA and and was wondering if the rollover automatically brings everything or could I sell some and just rollover like half with the remaining free to fill up.