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Old 04-09-2013, 04:54 PM   #41
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Do you just buy into the heavier Wellesley bond fund and close your eyes and not try to guess about what's going to happen?
Well, sorta.

I rolled over my 401k when I retired in 2005 into a mix of Wellesley and Wellington in a lump sum. It had a nice run up before the bottom fell out.

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Could just move most into the Wellington and see what happens since I have enough cash for another 3 years.
If you are a bit gun shy of the bond market and OK with the 60/40 mix of Wellington, I see nothing wrong with that approach.

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Oh well....followed my plan and am some thousands better off for it.
You did well - but you were still employed and had a paycheck coming in, right? Believe me, staying the course is an entirely different animal when what you see declining every day is the only thing between you and living in a cardboard shack for the rest of your life. That was a period some of serious white-knuckle OMG investing.
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Old 04-09-2013, 05:10 PM   #42
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I must admit having just skimmed the thread, but it seems that there's a cart/horse issue here.

I would say lay out our asset allocation target first. If you're going "zero" on a category, then state that. You should have at least: Cash, Domestic Bonds, Foreign Bonds, Domestic Stock, Foreign Stock, Hard Assets. If you don't know what numbers to put in there, just pick some numbers and refine them later, before you take action. Say 3,8,8,35,25,21. I'm not arguing for or against your personal risk tolerance, etc, but get something down on paper.

Once you have that defined, then enter your entire net worth into Morningstar Instant X-Ray and see where you come up ("as-is" scenario).

Now you examine the expense ratios of your current holdings. The high ones, are the first ones you move over to Vanguard. Again, back to the Instant X-Ray tool with your "to be" scenario. Does it hit your allocation target? You're done planning, now you need to execute.

Make a list of which account balances are going where. And as indicated earlier, the Vanguard employee will be glad to help you with the transfer paperwork.
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Old 04-09-2013, 05:11 PM   #43
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Well, sorta.

I rolled over my 401k when I retired in 2005 into a mix of Wellesley and Wellington in a lump sum. It had a nice run up before the bottom fell out.


If you are a bit gun shy of the bond market and OK with the 60/40 mix of Wellington, I see nothing wrong with that approach.


You did well - but you were still employed and had a paycheck coming in, right? Believe me, staying the course is an entirely different animal when what you see declining every day is the only thing between you and living in a cardboard shack for the rest of your life. That was a period some of serious white-knuckle OMG investing.
Yep....a job I probably should have stayed at for at least one more year. Saving almost $40K a year on a teacher salary those last couple of years...and no Masters even. Sweet job with good kids. Beautiful place N Yorkshire.....but damn does the wind blow there.
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Old 04-09-2013, 05:22 PM   #44
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I would say lay out our asset allocation target first. If you're going "zero" on a category, then state that. You should have at least: Cash, Domestic Bonds, Foreign Bonds, Domestic Stock, Foreign Stock, Hard Assets. If you don't know what numbers to put in there, just pick some numbers and refine them later, before you take action. Say 3,8,8,35,25,21. I'm not arguing for or against your personal risk tolerance, etc, but get something down on paper.

Once you have that defined, then enter your entire net worth into Morningstar Instant X-Ray and see where you come up ("as-is" scenario).

Now you examine the expense ratios of your current holdings. The high ones, are the first ones you move over to Vanguard. Again, back to the Instant X-Ray tool with your "to be" scenario. Does it hit your allocation target? You're done planning, now you need to execute.

Make a list of which account balances are going where. And as indicated earlier, the Vanguard employee will be glad to help you with the transfer paperwork.
Thanks, haven't tried the Morningstar xray in a looooong time. I'll give that a try now. Definitely just leaning towards Wellington for most of the approx $280k. As has been stated.....simple, and I can see driving myself nuts thinking about it too much. You should see me in front of the ice cream section at the grocery store......can be a long decision process.

Now the other question......do I leave the CD/corporate money in EJones or move that over as well? That is enough for me to live off the next 3 years.....maybe even pushing 4 years.
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Old 04-09-2013, 05:25 PM   #45
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Yep....a job I probably should have stayed at for at least one more year. Saving almost $40K a year on a teacher salary those last couple of years...and no Masters even. Sweet job with good kids. Beautiful place N Yorkshire.....but damn does the wind blow there.
That's great, but not the point I was making.

When you are retired, no longer have a steady paycheck, and the market hits a rough spot, it can be significantly more difficult to resist selling (as some of your friends did) and stick to your rebalancing plan. Owning balanced funds like Wellington/Wellesley can take some of that pressure away and for that reason could be a better choice.

Good luck, when and if you do decide what to do...
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Old 04-09-2013, 05:36 PM   #46
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Now the other question......do I leave the CD/corporate money in EJones or move that over as well? That is enough for me to live off the next 3 years.....maybe even pushing 4 years.
Personally, I would do a transfer of those assets with VG, too. Make a clean break from EJ.
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Old 04-09-2013, 05:41 PM   #47
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WAHOO- I got what you meant......again I was too thick to say it right. Got typing and got off on another tangent. I have the attention span of a middle school student (no offense to middle school students...actually liked working with them).
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Old 04-09-2013, 05:43 PM   #48
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I have the attention span of a middle school student...
Another reason Wellington/Wellesley could be the better option.
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Old 04-09-2013, 06:05 PM   #49
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Personally, I would do a transfer of those assets with VG, too. Make a clean break from EJ.
That's what I'd do too. I might take $50,000 and put it in an account earning 1.5% (the catch is that you need to use the debit card 10 or so times a month). https://www.kasasa.com/kasasa-providers
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Old 04-09-2013, 06:29 PM   #50
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sengsational- already using my credit union account (checking up to $10K) that gets 2% with good debit card usage. No problem for me to hit the limit on using the debit card....more than 10 times.....hardly use money anymore. Several of those CD/corporates are getting well over 2% as it is.
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Old 04-09-2013, 09:06 PM   #51
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sengsational- already using my credit union account (checking up to $10K) that gets 2% with good debit card usage. No problem for me to hit the limit on using the debit card....more than 10 times.....hardly use money anymore. Several of those CD/corporates are getting well over 2% as it is.
Cool! My CU had me at 2%, then knotched down by 0.5% every few months. Finally had to bail on them when it went to 0.5%. Now I've got 50k at 1.5%. It's not much, but better than the alternative (Discover rewards).
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Old 04-09-2013, 09:06 PM   #52
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Making yet another effort to become self-sufficient with the whole financial deal. Almost 2 years now in retirement (56 this summer, wife soon to be 53). Just getting tired of paying the Edward Jones fees...yet I like the hand holding. I have several of the recommended books (4 pillars, couple of Bogle books etc), but when all is said and done....just don't know enough to do it on my own. At this moment if I had to move the $365K out of EJones (and possibly the $420K in TSP) and into Vanguard, I would likely just stick it in either the Total Stock/Total Bond +/or Total International........or a Wellington/Wellesley combo....simple. But the steps on taking money out, taking money out to CD ladder, where to take the money from to ladder those few years of easy/cash money..... If nothing else, I understand the diversification theories well enough....and the concepts of rebalancing....but the other bits kill me. Just started reading the old FAQ section to pick up some more....but if someone could point me to a really really really simple....way way less than 150 pages book/articles....would be much appreciated. I can show you how to play Bach on mandolin.....at times I play close to scratch golf.... just plain thick with the investment world.
I am not sure where to point you to, but after working some in the financial world, I will say that only you have your best interests in mind. You can manage your money on your own and you honestly probably are underestimating yourself. A simple diversified conservative plan will beat out 95 % of investors. Find something that works and you are comfortable with (especially focusing on the simple part) and just execute the plan. Investing isn't hard, the financial world just wants everyone to believe that.
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Old 04-10-2013, 02:18 AM   #53
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The OP has 365k + 420k, plus 1k / month in pension, 0.7k/momth from SS, no debt. A 230k house he could remortgage if needed. He does not seem to have an expensive lifestyle and could cut down his golf habits if need be. He could get an SPIA. Maybe his wife has a pension too. I was just trying to be positve and encourage the OP. I have seen better financial situations, and I have seen much worse also.
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What is your definition of 'good', and how did you come to that conclusion?
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Old 04-10-2013, 09:43 AM   #54
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obgyn- yep, wife will get a pension, not much however....being from the UK she will get a little over $7,000 a year when she hits 66 (damn, they changed that one recently from 60)....and a very very small one of about $1500 a year at 60. Luckily the UK gives her credit for the years she raised her kids.

I need to give Vanguard a call today (and EJones) and check out the process. Wouldn't be surprised if I just chuck most the EJones stuff into the Wellington. Article today online in Bloomberg (I think?) about Wellesley.
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Old 04-10-2013, 10:56 AM   #55
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What is your definition of 'good', and how did you come to that conclusion?
The OP has 365k + 420k, plus 1k / month in pension, 0.7k/momth from SS, no debt. A 230k house he could remortgage if needed. He does not seem to have an expensive lifestyle and could cut down his golf habits if need be. He could get an SPIA. Maybe his wife has a pension too. I was just trying to be positve and encourage the OP. I have seen better financial situations, and I have seen much worse also.
That strikes me as a very odd response.

Why 'encourage' someone with a success rate of ~84%-89%? How is that being 'positive'? I prefer reality to unfounded optimism.

Those ~84%-89% numbers were based on the OP saying he needed to WD $30K from that portfolio (he said pension & SS covered other expenses). I didn't follow the exact timing of the SS/pensions, and if the pension is COLA'd, so I took the $30K from a $785K portfolio (50/50 and 60/40) at face value, and ran that in FIRECALC.

I would say the OP & DW need to positively take a closer look at their ER plans. If they are comfortable with a historic 15% failure rate - well, then I guess they are 'OK'.

-ERD50
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Old 04-10-2013, 11:34 AM   #56
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There are members of this forum who are experts on investing for retirement. Over the years many of us have lamented the lack of consumer education in this area but I did happen on an interview of Salman Kahn that discussed preparing financial education learning modules. Here is what I found today: Investment vehicles, insurance and retirement | Finance and capital markets | Khan Academy
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Old 04-10-2013, 05:44 PM   #57
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That strikes me as a very odd response.

Why 'encourage' someone with a success rate of ~84%-89%? How is that being 'positive'? I prefer reality to unfounded optimism.

Those ~84%-89% numbers were based on the OP saying he needed to WD $30K from that portfolio (he said pension & SS covered other expenses). I didn't follow the exact timing of the SS/pensions, and if the pension is COLA'd, so I took the $30K from a $785K portfolio (50/50 and 60/40) at face value, and ran that in FIRECALC.

I would say the OP & DW need to positively take a closer look at their ER plans. If they are comfortable with a historic 15% failure rate - well, then I guess they are 'OK'.

-ERD50
ERD- What settings are you using on Firecalc?.....every time I use it I end up at 100%....and that is without putting in assets like the house. Even without my wife's small pensions at 60+66 ($1500 + $7000 yr) I get a good result.
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Old 04-10-2013, 06:22 PM   #58
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A patient of mine comes to see me. She is overweight. She needs to lose 100 pounds. I tell her she should pay attention to her weight. She comes to see me 6 months later, tells me proudly she lost 10 pounds. About 10 percent of what is needed. Well, I WILL tell her "good job, now keep doing what you have been doing". What is so "odd" about saying this?

If you prefer to use "reality", (i.e telling your patient "you are still morbidly obese") instead of encouraging using positive feedback ("good job!") and reinforcement, so be it.

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That strikes me as a very odd response.

Why 'encourage' someone with a success rate of ~84%-89%? How is that being 'positive'? I prefer reality to unfounded optimism.

-ERD50
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Old 04-11-2013, 02:03 AM   #59
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I drink WAY too much beer/sodas/junk food...there goes a couple thousand.
I mean this in a caring way but....

I wouldn't be worrying too much about a 40 year timeline for your funds if this doesn't change.

Just sayin. No offence intended
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Old 04-11-2013, 08:30 AM   #60
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ERD- What settings are you using on Firecalc?.....every time I use it I end up at 100%....and that is without putting in assets like the house. Even without my wife's small pensions at 60+66 ($1500 + $7000 yr) I get a good result.
See the links I included in post #33.

Note that I 'normalized' the withdraws/portfolio of $30K/$785K to a % of $1,000,000 - that just makes it easy to translate WR to %. $38,300/$1,000,000 = 3.83%.

I focused on the portfolio - I didn't add your SS/pension, or the spending you say it offsets, so it should be a wash as far as portfolio survival. Partially, I didn't follow all the details of timing and COLA, and it still is valid if that $30K inflation adjusted needs to come from the portfolio. Maybe you are entering more pension/SS than the added spending you mentioned? I don't understand those details, so you would need to post that info concisely if you want an opinion that includes that data.

You can post the links as I did - on the results page:

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Link to this set of data (Right-click and either "Copy Shortcut"
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A patient of mine comes to see me. She is overweight. She needs to lose 100 pounds. I tell her she should pay attention to her weight. She comes to see me 6 months later, tells me proudly she lost 10 pounds. About 10 percent of what is needed. Well, I WILL tell her "good job, now keep doing what you have been doing". What is so "odd" about saying this?

If you prefer to use "reality", (i.e telling your patient "you are still morbidly obese") instead of encouraging using positive feedback ("good job!") and reinforcement, so be it.
Two very different things, in my view. Both your patient and the OP have made progress towards their goal, and that's good and I encourage both. But that's is not what we are discussing here.

I don't think it would be helpful if you told your patient that all was good, she doesn't need to lose any more weight, let's just be happy with where she is (90# overweight)? And I don't think it would be helpful to the OP to tell him all is good, let's just be happy with what might be an 85% success rate, and let's pretend it's much higher, just to be 'positive'?

The OP has obviously done well to be this close. What many of us are saying is that he better take a closer look at those numbers - he may not have the confidence factor he is thinking he does (devil's in the details, but better safe than sorry).

-ERD50
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