nisa lumpsum or tsumitate nisa

[Roger Van Zant]

I do not understand all of this and I am overwhelmed.

You cannot go wrong with the Tsumitate Nisa and the Emaxis Slim All Country Fund.
[/quote]

This is exactly me! Thanks!

[bryanc]

my wife and i have enough to do the lump sum asap -this is what our plan was and which you kindly suggest would be the best way forward if
funds available.
however,the one thing that gives me pause is that (as people say) im worried about it being time limited and thus vulnerable to a market dip
(not being invested for the length of time reqd for the law of averages to work)

Are you planning one Regular NISA, or one apiece?

If it is only 1 account, it might be better to do 2 Tsumitates each.

plan to do one each of the regular NISA 1.2million each...

[bryanc]

I do not understand all of this and I am overwhelmed.

You cannot go wrong with the Tsumitate Nisa and the Emaxis Slim All Country Fund.

This is exactly me! Thanks!
[/quote]

does this mean that you can go wrong with the regular nisa and emaxis?

i saw this posted by Ben on the site -can the regular NISA not be set and forgotten ??

"For most people, tsumitate NISA is probably the easiest option, as you can set it and forget it. You also get 20 years of tax-free growth."

[adamu]

can the regular NISA not be set and forgotten ??

After the first 5 years, you have to submit an online form at the end of each year to say you want to rollover to the next year.

No such procedure exists for Tsumitate. Once the 20 years in Tsumitate is up, that's it (so far...).

[fools_gold]

The big problem with the regular NISA is what to do if you plan on continuing to invest long term.

Once you hit 5 years, you can rollover. Each rollover uses up that year's NISA allowance so any new investments must go into a taxable account.

[beanhead]

The big problem with the regular NISA is what to do if you plan on continuing to invest long term.

Once you hit 5 years, you can rollover. Each rollover uses up that year's NISA allowance so any new investments must go into a taxable account.

True, but in principle the same thing happens with Tsumitate, doesn't it? If you max out 400k a year for 20 years, after that everything additional would need to go into a taxable account.

So the differences are the total amounts (6M vs 8M), and the time period, 5+5 years (assuming rollover) vs 20 years for tsumitate. That somewhat nice-to-have problem of maxing out your tax-free allowance comes after 5 or 10 years with the regular NISA. I think...

[fools_gold]

True, but in principle the same thing happens with Tsumitate, doesn't it? If you max out 400k a year for 20 years, after that everything additional would need to go into a taxable account.

So the differences are the total amounts (6M vs 8M), and the time period, 5+5 years (assuming rollover) vs 20 years for tsumitate. That somewhat nice-to-have problem of maxing out your tax-free allowance comes after 5 or 10 years with the regular NISA. I think...

Assuming you have 1.2 million yen to invest every year with an investment horizon of 20+ years you can either put it all into a regular NISA (until it ends) for 10 years followed by 10 years in taxable, or put 400k in a Tsumitate NISA and 800k in a taxable account.

For shorter time periods the regular NISA obviously wins out, but as you reach 20 years the taxable capital gains for both scenarios are pretty similar (that's assuming returns of 6-7%). The advantage of the Tsumitate + taxable combination is that you don't run into the problem of what to do in rollover years.

[Kanto]

For shorter time periods the regular NISA obviously wins out, but as you reach 20 years the taxable capital gains for both scenarios are pretty similar (that's assuming returns of 6-7%). The advantage of the Tsumitate + taxable combination is that you don't run into the problem of what to do in rollover years.

Hmmm this is quite reassuring actually. This is what my wife and I are doing currently

- 2 x Tsumitates (Front-loaded)
- 1x Junior Nisa
- 2 X ideCo (68,000+12,000)
- Anything over the our emergency fund in our taxable.

With Tsumitate+Rakuten Credit Card you can also earn those free points. About 8man over the course of a Tsumutate, with a maximum of 12man with Tusmitate+taxable over 20 years. Which is not nothing! (Which also compounds because you can use those points to purchases trusts through Rakuten.

Which would be around 30man at 8% interest over 20 years.

[adamu]

The advantage of the Tsumitate + taxable combination is that you don't run into the problem of what to do in rollover years.

Until they add Rollover for Tsumitate a few years down the line

[Yossarian]

Hmmm this is quite reassuring actually. This is what my wife and I are doing currently

- 2 x Tsumitates (Front-loaded)
- 1x Junior Nisa
- 2 X ideCo (68,000+12,000)
- Anything over the our emergency fund in our taxable.

With Tsumitate+Rakuten Credit Card you can also earn those free points. About 8man over the course of a Tsumutate, with a maximum of 12man with Tusmitate+taxable over 20 years. Which is not nothing! (Which also compounds because you can use those points to purchases trusts through Rakuten.

Which would be around 30man at 8% interest over 20 years.

Reassuring for me too. Spent the last couple of years building up the emergency fund, tsumitate and iDeco. Now the emergency fund is where we want it there's about 100k a month going in to the taxable. Nice to know I'm on the right path.