Re: Investment Strategy
My strategy is to diversify my holdings among various asset classes, such as: 1) large, mid, and small cap value and growth stock mutual funds with an emphasis on value/dividend paying funds; 2) International stock funds; 3) REITs; 4) commodities (basic feed/fuel for industry such as oil, gas, and timber; 5) higher quality corporate bonds, gov't. bonds, and International bonds; and 6) in various cash equivalents, such as CDs, money market funds, and ultra-short bond funds. These funds will specialize in low cost/fees, reasonable performance, and less volatility than average. Further, I would move money into bonds if interest rates were high and the economy slowing in anticipation of interest rate cuts and bond cap gains. I would also sell off the commodity type things in a slowing economy and try to pick them up later as the economy bottoms out. The bonds would be sold off after interest rate cuts and repurchased later on when rates were high again.
Aside from this, the next thing is to manage expenses and not change my rather frugal (some would say cheap!) spending habits. Retirement money may have to last a long time, so it is important that it be managed carefully. It's better to have smaller gains and losses than bigger ones, as it is very difficult to replace money that has been lost at a time when our income stream is at a reduced level compared to our best working years.
A bundle of cash is a good thing to have around. True, it's not working very hard these days but then, as they say, "a 2% gain beats a 20% loss every time"!
Ed_B