Join Early Retirement Today
View Poll Results: FIREd folk only: How much cash in your AA?
less than 6 months expenses 6 12.00%
between 6 and 18 months expenses 11 22.00%
between 18 and 30 months expenses 11 22.00%
more than 30 months expenses 22 44.00%
Voters: 50. You may not vote on this poll

Reply
 
Thread Tools Search this Thread Display Modes
Old 07-30-2009, 04:42 AM   #21
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
 
Join Date: Jul 2005
Posts: 5,408
Quote:
Originally Posted by Moemg View Post
I have just about two years of living expenses in cash . I had less but I found that the two years let me sleep better when the market was fluctuating .
same here, rays bucket system, 7 years cash ..... why play the game if you already one...the buckets work for me, the large cash is comforting and the equities are as aggressively invested as if i was 25
__________________

__________________
mathjak107 is offline   Reply With Quote
Join the #1 Early Retirement and Financial Independence Forum Today - It's Totally Free!

Are you planning to be financially independent as early as possible so you can live life on your own terms? Discuss successful investing strategies, asset allocation models, tax strategies and other related topics in our online forum community. Our members range from young folks just starting their journey to financial independence, military retirees and even multimillionaires. No matter where you fit in you'll find that Early-Retirement.org is a great community to join. Best of all it's totally FREE!

You are currently viewing our boards as a guest so you have limited access to our community. Please take the time to register and you will gain a lot of great new features including; the ability to participate in discussions, network with our members, see fewer ads, upload photographs, create a retirement blog, send private messages and so much, much more!

Old 07-30-2009, 07:19 AM   #22
gone traveling
 
Join Date: Apr 2009
Location: Eastern PA
Posts: 3,851
Retired at age 59, a bit over 2 years ago.

At the time, I set my cash at a four-year gross income level. I sold a bit off at the end of 2007 (yes, it was an up year ), and have not sold since that time.

Currently just a bit over 2.5 years cash on hand (in a MM account). And yes, the balance could be considered "excessive" but most of my income is derived from my portfolio, of which I have not sold a single share (and reinvested all distributions) since the downturn.

My draw is also a bit high since I'm pre-SS (can file in a few months - but I'm waiting till age 70.)

Looking over our investment history (almost 30 years) it seems on average (with our investment mix) that we show gains every 2 of 3 years. That's why I set the 4-year gross cash income level for my cash bucket. My wife (even though still employeed) also has her cash bucket at this level. That will allow her to leave work any day she wishes, either due to layoff or just wanting to retire.
__________________

__________________
rescueme is offline   Reply With Quote
Old 07-30-2009, 07:32 AM   #23
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
 
Join Date: Jun 2005
Posts: 8,616
I don't think anyone would quibble about how much cash you were holding if it was earning 2% above the rate of inflation. All the gnashing of teeth nowadays about cash seems to me to be mostly about the sub-0.5% rate that one gets in savings accounts or money market funds.

Perhaps the poll should be something like:

What percent of your assets are in cash-like assets earning less than 1% annually in interest?

-or-

What percent of your assets are in fixed income earning less than the rate of inflation?

With mutual funds and ETFs, almost all of one's financial assets could be very liquid.
__________________
LOL! is offline   Reply With Quote
Old 07-30-2009, 09:37 AM   #24
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
youbet's Avatar
 
Join Date: Mar 2005
Location: Chicago
Posts: 9,965
Quote:
Originally Posted by mathjak107 View Post
same here, rays bucket system, 7 years cash ..... why play the game if you already one...the buckets work for me, the large cash is comforting and the equities are as aggressively invested as if i was 25
Soooo..... if you've "already won," why are you "playing the game and investing as aggressively as if you were 24?"

Ray's system always seems like an oxymoron
__________________
"I wasn't born blue blood. I was born blue-collar." John Wort Hannam
youbet is online now   Reply With Quote
Old 07-30-2009, 09:53 AM   #25
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
TromboneAl's Avatar
 
Join Date: Jun 2006
Posts: 11,197
In mid-October '08, holding more cash looked like a good idea. However, note how quickly bonds recovered. I wonder what the chances of a prolonged period of hand-in-hand equity/bond declines are.

__________________
Al
TromboneAl is offline   Reply With Quote
Old 07-30-2009, 10:25 AM   #26
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
TromboneAl's Avatar
 
Join Date: Jun 2006
Posts: 11,197
Quote:
why play the game if you already won?
This is related to a kind of catch-22 situation I often think about.

Let's say that instead of having just enough to retire, you have, say 10 million dollars. In that situation you could be 100% money market, and have no worries that you'd outlive your money. IOW, you have no need for the risk of equity investments.

But, OTOH, because you have so much money you can easily handle the risk of a 100% equity allocation.

When you have more, you need less risk, but can tolerate more.
__________________
Al
TromboneAl is offline   Reply With Quote
Old 07-30-2009, 05:17 PM   #27
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
 
Join Date: Jul 2005
Posts: 5,408
Quote:
Originally Posted by youbet View Post
Soooo..... if you've "already won," why are you "playing the game and investing as aggressively as if you were 24?"

Ray's system always seems like an oxymoron
because you have the amount of dough in the buckets to generate the amount of income you need but that money you need to eat in 30 years still hyas to grow so you can move it into the buckets for spending...... you won means you have enough to fill the buckets as opposed to still have to save the money to put in
__________________
mathjak107 is offline   Reply With Quote
Old 07-30-2009, 08:01 PM   #28
Moderator Emeritus
Nords's Avatar
 
Join Date: Dec 2002
Location: Oahu
Posts: 26,616
Quote:
Originally Posted by TromboneAl View Post
This is related to a kind of catch-22 situation I often think about.
Let's say that instead of having just enough to retire, you have, say 10 million dollars. In that situation you could be 100% money market, and have no worries that you'd outlive your money. IOW, you have no need for the risk of equity investments.
But, OTOH, because you have so much money you can easily handle the risk of a 100% equity allocation.
When you have more, you need less risk, but can tolerate more.
Same conundrum here. Especially when you consider that you could give $7-8M of that to charity.

Here's an interesting perspective on an emergency fund from an ER who has an interesting perspective on just about everything:
http://earlyretirementextreme.com/20...perfluous.html
__________________
*
*

The book written on E-R.org, "The Military Guide to Financial Independence and Retirement", on sale now! For more info see "About Me" in my profile.
I don't spend much time here anymore, so please send me a PM. Thanks.
Nords is offline   Reply With Quote
Old 07-30-2009, 09:00 PM   #29
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
audreyh1's Avatar
 
Join Date: Jan 2006
Location: Rio Grande Valley
Posts: 16,457
Quote:
Originally Posted by TromboneAl View Post
This is related to a kind of catch-22 situation I often think about.

Let's say that instead of having just enough to retire, you have, say 10 million dollars. In that situation you could be 100% money market, and have no worries that you'd outlive your money. IOW, you have no need for the risk of equity investments.

But, OTOH, because you have so much money you can easily handle the risk of a 100% equity allocation.

When you have more, you need less risk, but can tolerate more.
I think in that situation I would be giving a lot more of it away. Maybe some of it in the form of those charitable "annuities" or whatever they are called that pay you X% a year for life on your donation.

Otherwise hard to say. I suspect some folks put enough of it in safe tax-free fixed income funds to generate oodles of annual income, and some are probably quite aggressive with investing the chunk they don't "really need".

But I have found that when I am feeling "flush" I tend to spread the wealth toward family members as well (parents, siblings, we have no kids), and I also prefer to have enough in reserve to be able to cover things like medical expenses disasters or long-term care needs for a parent. I suspect the super rich also do a lot of annual gifting as well.

In other words, it's easy to find ways to rachet up the spending even if it's not on yourself. So you have to manage the $$$s to support that too.

Of course some of those folks go out and buy a yacht! After their $2M house! LOL!

Audrey
__________________

__________________
audreyh1 is offline   Reply With Quote
Reply


Currently Active Users Viewing This Thread: 1 (0 members and 1 guests)
 
Thread Tools Search this Thread
Search this Thread:

Advanced Search
Display Modes

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is Off
Trackbacks are Off
Pingbacks are Off
Refbacks are Off


Similar Threads
Thread Thread Starter Forum Replies Last Post
What percent of my income should I be saving in order to FIRE? nico08 FIRE and Money 23 07-06-2011 12:03 PM
Fire! Fire!---Not FIRE mickeyd Other topics 16 11-18-2008 05:19 PM
percent above inflation searcher FIRE and Money 15 01-10-2005 06:15 PM
Initial Withdrawal Percent? moguls FIRE and Money 7 12-20-2003 04:59 PM

 

 
All times are GMT -6. The time now is 12:32 PM.
 
Powered by vBulletin® Version 3.8.8 Beta 1
Copyright ©2000 - 2017, vBulletin Solutions, Inc.