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Old 03-03-2013, 10:44 AM   #21
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I know I didn't paint a very pretty picture, but then I'm no Rembrandt...
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Old 03-03-2013, 10:50 AM   #22
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Where is "psssssst, Wellesley"?

Based on what some people discuss here -- and being a Vanguard newbie myself -- DH and I have dipped our toes into Wellesley and continue to consolidate our holdings and reassess our AA.

I have bought those books and done a lot of reading there and here, too, but I always find that when it comes to finances, it helps me a LOT to just buy some of what I'm thinking about and see how it behaves and how we feel about how it behaves. I also like to see the tax ramifications, especially now that I pay more attention to such things.

(When we w*rked, we just made it, saved it, spent it, and didn't do much planning with taxes.)

We still have a lot of holdings in CDs, but we're branching out a bit.

Such an approach might work for OP.
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Old 03-03-2013, 11:33 AM   #23
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I was going to write something along the same lines. Maybe $50k in CDs and $50k in SPIAs?
Yes, I'd hate to put everything into monthly income.

If GNMA's seem scary, I don't think Wellesley is going to seem any better. But maybe a good place to dip a little toe into and try to outpace inflation.
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Old 03-03-2013, 11:34 AM   #24
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i make no guarantees-but.

i have researched troweprice lifestyle funds. i have the 2020.

prices philosophy is the greatest danger to retirees is running out of money.

they keep their lifestyle funds in a higher percentage of stocks than other fund managers.

they also reduce the rate of stocks at a slower rate than other funds after
it reaches the date.

is it guaranteed-of course not-but it has an excellent track record.

you can buy government securities at treasurydirect. they are guaranteed.
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Old 03-03-2013, 11:36 AM   #25
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How would you advise to invest $100,000.00 with the highest return and the lowest risk of loss? This money is a significant portion of my nest egg. Thanks.

how significant portion is 100,000. how old are you. are you still working. need more info
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Old 03-03-2013, 02:19 PM   #26
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OK, here it is.
I have $145,000 in cash.
$35,000 in my 401k plan (in Pimco Total Return Fund)
$7500 in EE Bonds.
SPIA paying me $445 per month.
Currently working and earning about $35000/year.
I will turn 50 this month.
If I retired, I could probably live on as little as $15000/year.
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Old 03-03-2013, 02:28 PM   #27
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OK, here it is.
I have $145,000 in cash.
$35,000 in my 401k plan (in Pimco Total Return Fund)
$7500 in EE Bonds.
SPIA paying me $445 per month.
Currently working and earning about $35000/year.
I will turn 50 this month.
If I retired, I could probably live on as little as $15000/year.

if i were you i would not retire
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Old 03-03-2013, 04:39 PM   #28
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$187,500 in assets might allow up to 4% = $7500 per year income. That assumes it is invested in about 50% equities and you are mildly lucky.

Add to that the SPIA gives you another $5340 for a total of $12840 per year.

Not up to your $15k minimum yet. All $187500 in an SPIA might just squeak you up to $15k, but with no inflation protection at all. Very risky at this time I think.

If you have a large SS benefit coming you could possibly use what you have to bridge the time until SS starts, but that still seems pretty marginal.
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Old 03-03-2013, 05:22 PM   #29
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How much do you think you will get in SS? If it is ~$15k in current dollars, if you retired today your nestegg could take you from 50 to 62 and then you could start SS but your nestegg would be close to gone. To be candid, that would be cutting things far to close to comfort for me and I think you need to keep working, but that is a judgement that you have to make.
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Old 03-03-2013, 05:36 PM   #30
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Top Ramen........or possibly baked potato's only...... sell car.....walk everywhere....
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Old 03-05-2013, 05:46 AM   #31
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.....$35,000 in my 401k plan (in Pimco Total Return Fund).....Currently working and earning about $35000/year.
I will turn 50 this month......
Are you contributing the max tax-deferred allowed in your 401k? The 2013 limit is $17,500. Plus, since you're 50 you can do Catch-up Contributions of another $5500. If you can't swing the max contribution then increase it 1-2% at your next pay increase, and do this yearly.

I'd suggest power saving over the next 15 years.
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Old 03-05-2013, 11:40 AM   #32
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Are you contributing the max tax-deferred allowed in your 401k? The 2013 limit is $17,500. Plus, since you're 50 you can do Catch-up Contributions of another $5500. If you can't swing the max contribution then increase it 1-2% at your next pay increase, and do this yearly.

I'd suggest power saving over the next 15 years.
Thanks for the suggestion, but I was hoping to retire early(before 65). I am willing to listen to more aggressive investing ideas.
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Old 03-05-2013, 11:59 AM   #33
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Thanks for the suggestion, but I was hoping to retire early(before 65). I am willing to listen to more aggressive investing ideas.
How early is "early"? I see no prospect that you will be able to retire securely any time soon. You have two fundamental issues that are holding you back - an excessively conservative asset mix and too small an amount in savings. There are a lot of ways to address your asset mix - Vanguard Wellesley, Wellington, or a target date retirement fund spring immediately to mind. But the only way to bump up your retirement savings is to delay retirement while continuing to save as aggressively as you can and hope for reasonable investment returns. That takes time. You could realistically start looking at retirement around age 60, or better yet at 62 when you are eligible for Social Security.
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Old 03-05-2013, 01:14 PM   #34
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OK, here it is.
I have $145,000 in cash.
$35,000 in my 401k plan (in Pimco Total Return Fund)
$7500 in EE Bonds.
SPIA paying me $445 per month.
Currently working and earning about $35000/year.
I will turn 50 this month.
If I retired, I could probably live on as little as $15000/year.

In the current environment I feel that the best deals are available in "blue chip" stocks.

In the current market you can make around 3% from dividends, investing in blue chip stocks. You could make the argument that this is riskier than investing in a fund.

If you want to use a fund you could get around 2% from a dividend growth oriented fund.

Based on your assets you could bring in around $6k per year from dividends (which will probably grow faster than inflation), investing in blue chip stocks.

Your SPIA is bringing in $5,340 per year. So combined you have $11,340.

You are not too far off from your goal of $15,000.

My advice would be that you find a more enjoyable line of work. You don't need to make a whole lot of money. Just find something that can carry you onto social security. Then you can quit for real.
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Old 03-05-2013, 03:02 PM   #35
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How would you advise to invest $100,000.00 with the highest return and the lowest risk of loss? This money is a significant portion of my nest egg. Thanks.
Boy I wish you were one of my friends or family, because I can offer my friends and family investment opportunities backed by tangible assets where they make safe and consistent returns.

If anyone in your family or one of your friends invests in real estate, you could put that money to work by partnering with them. A little outside the box of stocks, mutual funds, CD's and the like. But, with those if the value goes down to zero you have no recourse, that's it, your money's gone. With real estate, even if the payments stop coming in, you have something tangible to re-coup your investment. Some food for thought.
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Old 03-05-2013, 03:22 PM   #36
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Boy I wish you were one of my friends or family, because I can offer my friends and family investment opportunities backed by tangible assets where they make safe and consistent returns.
Do tell, driver70. What is this wondrous opportunity you dangle before us?
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Old 03-07-2013, 10:33 AM   #37
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Do tell, driver70. What is this wondrous opportunity you dangle before us?
I wish I could but I can't discuss details publicly, it's against SEC rules, which is why I only offer to friends and family. But as I said in my post, if one of the OP's friends or family members invests in real estate with at least moderate success, they could partner with them to put their money to work. Depending on how they invest, it could mean a short term partnership, long term, or anywhere in-between. But in essence, they could become the bank.
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Old 03-07-2013, 10:38 AM   #38
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I wish I could but I can't discuss details publicly, it's against SEC rules, which is why I only offer to friends and family. But as I said in my post, if one of the OP's friends or family members invests in real estate with at least moderate success, they could partner with them to put their money to work. Depending on how they invest, it could mean a short term partnership, long term, or anywhere in-between. But in essence, they could become the bank.
Private placements.......... Or perhaps a Ponzi scheme?
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Old 03-07-2013, 10:41 AM   #39
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... I only offer to friends and family.
Just like Verizon - and Bernie Madoff?
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Old 03-07-2013, 11:12 AM   #40
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Just like Verizon - and Bernie Madoff?
Wow the negativity is appalling... anyways it's events like those that probably prompted stricter SEC rules to begin with. But I'm sure there are plenty of other real estate investors here that use and understand the power of private money. It's the availability of money that gets deals done, and at 35 I've thrown about every extra penny I've had towards real estate (after paying down all debts and building up savings). I've been able to turn $70,000 of my own money, into over $200,000 in equity, and a couple thousand dollars of positive monthly cashflow. I'm closing on another deal within 45 days, and already have the next deal in my sights. From here, I'll spend the next 1.5 years building a 60k reserve, then I'm done with w*rk... thank goodness for the YMYL crossover point.
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