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Old 11-14-2016, 05:21 AM   #21
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Didn't see this brought up, so I thought I would raise it. Given the ages of the OP and spouse, they can very reasonably expect to live another 25-30 years. So is 60/40 really appropriate? Yes, one has to stay w/in one's risk tolerance, and surely the looming idea of having to draw on the funds in about 18 months is a concern.

Would it perhaps not be better to move a year or so of living expenses to cash, and then go 90/10? So as to (at least partially) assuage the fear of sequence of returns risk? Or, if the OP could stomach staying employed a little longer, that could also play a role.


(PS - if 60/40 is what it takes to sleep well at night, then certainly that is the right answer for OP. But in the general case.... ?)

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Old 11-14-2016, 06:54 AM   #22
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90/10 after 1 year of cash? History has shown declining periods of stocks as long as 10 years. How does one know if it will not repeat?

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Old 11-15-2016, 11:30 AM   #23
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Back again. Thanks for the comments.
The 10 debit transactions needed at our CU to qualify for 3.5% is not an issue. We both are working and that is a couple of lunches a week. We put the low dollar items here in order to maximize miles on our credit cards. And our paychecks are ACH. So very easy to get 3.5% on 1st $25k in our checking account.
Re: AA. It was my understanding that the closer to retirement - the more conservative our AA should be. We had been fairly aggressive to date and had only been at 70/30 for a couple of years (prev 80/20).
Of the $ 820k (40% bond/fixed) is $327k in the 3.5% fixed fund in my 403b. In addition, we have $156k cash. Our budgeted spend in retirement is $120k a year, but can easily scale that back to $90k. So in down market, the plan is $100k spend, Pension $45K, DH SS $20K, so $35k needed from investments. We can pull our minimum needs of $35k for 25 years from the fixed/bond portion if need be.
That being said, I don't believe I am market timing. The new AA is more conservative due to our age and retirement date of 17 months.

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