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Old 06-14-2016, 09:41 PM   #61
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I am 53 and have been retired for 7 1/2 years.

I have two different AAs for subsets of my overall portfolio. This is because part of it I use to generate monthly income for my current expenses and the other part of it (an IRA) I will tap into later on, one of my "reinforcements."

For my taxable portion, it is 63/37 in favor of bonds. For the IRA it is 50/50. Combined, it is 58/42 in favor of bonds. I don't have a real cash portion because it is so small and gets replenished every month to pay the bills.

Do any of you really early retirees who can't tap into a pension, SS, or an IRA, have different AAs for currently untouchable (or very nearly so) assets than you do for your current, taxable portions?

Retired in late 2008 at age 45. Cashed in company stock, bought a lot of shares in a big bond fund and am living nicely off its dividends. IRA, SS, and a pension await me at age 60 and later. No kids, no debts.

"I want my money working for me instead of me working for my money!"
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Old 06-14-2016, 09:46 PM   #62
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Join Date: Jun 2004
Posts: 426
I view it overall bc I have no intention of drawing on it:
Small cap stocks 10%
Large cap stocks 65%
Tax free bonds (only in taxable accts) 20%
Cash waiting on limit orders 5%

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Question for current retirees
Old 06-14-2016, 10:04 PM   #63
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Question for current retirees

I fired at 45. Now 47...

Long time horizon hopefully.

Zero pension

90% equities / 10% cash

No pain. No gain.

Plus I actually worry about inflation

with bonds paying near 0 I do not hold any bonds... in stocks I'm collecting a dividend and outpacing inflation, although of course risk is slightly higher.

Current touchable AA and deferred untouchable assets share same AA... I don't differentiate.
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Old 06-14-2016, 11:01 PM   #64
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Join Date: Jan 2008
Posts: 542
We have COLA'd pension that cover 50% of our expenses. Investments provide the other 50% with a current AA of:

58% - Equities (30% of that is international, VTSAX/VTIAX)
36% - Bonds (VTBLX)
6% - Cash (ALLY Bank)

When/if the assets run out, we have SS waiting at 62 if need, and a small pension at 65. The SS and pension will more than cover the 50%.

BTW, I just happened to check out some different AA in cFIREsim last evening. Turns out the 40/60 produced 0.38% less annual income than the 60/40 AA. That's $380 for every $100K. Relatively insignificant in my world.
Retired July 2013 at age 49.

Lazy Portfolio Investor:
AA: 55% Stocks
35% Bonds
10% Cash
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Old 06-15-2016, 12:25 AM   #65
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Retired 3 years ago, now 48. Real estate income covers 50% of expenses, COLA'd pension covers 25%, and the remaining 25% is from the portfolio.

55% equities, 30% bonds, 5% gold, 10% cash/CDs.
Of the equities, 30% are international.
I don't purposely differentiate AA between touchable and untouchable accounts, other than keeping the bonds in tax-deferred.

Because I'm at a low WR, at times I feel I should invest more aggressively but then I remember that sinking feeling in 2008 that caused me to pull money out of the market to pay down mortgages. I'd like to think that I'd react differently now that I'm reading this board, but I'll stick with a moderate AA just in case.
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Old 06-15-2016, 03:20 AM   #66
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63 ,retired 1 year

my portfolio is dynamic and changes from time to time . i try to beep the beta within a certain range .

right now i am 33% equity's but 1/2 the bond budget is in high yield funds acting as a lower beta proxy for equity's . they offer the same returns as stock now but at almost 1/2 the volatility {.56}.

other times i can be as high as 50/50
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Old 06-15-2016, 03:58 AM   #67
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Originally Posted by Corporateburnout View Post
I'm surprised to see people with pensions and SS covering all their expenses with 50% or less in equities. We're 50/40/10 Stocks/Bonds/Cash with no pension and SS in a couple of years. For the OP do you have a pension?
DH and I are almost in this group that surprises you(55% equities). Two COLA'd pensions and 2 SS's ultimately coming on line that cover all current expenses. Once RMD's kick in next year for DH and two years later for me a small portion of the RMD's will be needed to cover increased taxes, but SWR will still be below 1%. We may begin more aggressive legacy gifting at some point rather than just watch the pile grow. Our AA is 55/35/10. During the 2007-2008 period our risk tolerance led us to decrease that AA from the 60% Equity position we had to our present day 55%. I doubt that we will lower it any for the foreseeable future. Even though we could afford to be a bit more aggressive in our AA I doubt that our heirs (DD and DS) would want us to risk their inheritance. It's the SWAN factor that is important to us.
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Old 06-15-2016, 06:05 AM   #68
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Age 58. Retired in Sept 2015

10% cash
45% equity - 1/3 of that international
45% bond - 1/3 international

I have low risk tolerance. No pension. Not sure yet about when I will take SS.
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Old 06-15-2016, 06:31 AM   #69
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No pension. Get wife's SS now, mine in 2 years. Rentals throw off good return, just not a lot.

Hard to track exact percents between the funds & individual stocks/bonds.

But roughly,

55 equities including about 10 as international funds
8 real estate between REITS and rental units equity
25 bonds with about 8 muni
12 currency between foreign currency funds, short-term muni-bond funds, Au funds, and 1 US $.
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Old 06-15-2016, 07:26 AM   #70
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I'm 63 and have been retired for 2 years. Husband is 77 and retired at 65. We get his SS and a small pension of mine; total is about $34K/year. I have another pension I'll start next year; my pensions total about $20K/year, no COLA. I haven't started on SS yet.

Our asset allocation is aggressive but I don't have a problem with that. We're at about 3.5% cash, 78% equities, 18.5% fixed. The withdrawal rate has been 3.8% annualized but that will decrease; we had a lot of expenses from fixing up our previous house to sell, moving, buying the new one, fixing that one up, plus some unexpected repairs. I hope we don't have to go through that again for a long time!
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Old 06-15-2016, 08:07 AM   #71
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-All normal expenses more than covered by COLA'd pension and SS (hers quite modest.)
-Ages 71/69
-40/56/4. (Following "when you've won the game...")
--20-25% of equity is international. No international bonds.
-May go to 45-50% equities in future.
-Main concern is to preserve funds w/o substantial risk in case I go before she does. That would decrease take from pension substantially (SBP = about 1/3 of current pension). So keeping up w/inflation or perhaps that and a bit more is fine.
-If she were to go first and I were on my own, I would probably go to 50/50 or 60/40.
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Old 06-15-2016, 08:09 AM   #72
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Originally Posted by scrabbler1 View Post
Do any of you really early retirees who can't tap into a pension, SS, or an IRA, have different AAs for currently untouchable (or very nearly so) assets than you do for your current, taxable portions?
I am wrestling with the same thing: age 59, forced retirement about a year ago (hooray!). No pension.

BUCKET 1: From now until 70 I will draw on my non-retirement investments and on the RMDs from an inherited IRA.

BUCKET 2: At 70 I will start taking RMDs from my own IRA and Roth as well as SS.

My target asset allocation is 65/30/5 equities/bonds/cash. Do I balance each "bucket" the like this, or do I balance overall, which means for tax efficiecy putting income generating assets in the retirement funds?
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Old 06-15-2016, 08:21 AM   #73
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Location: Castro Valley
Posts: 330
Age 58, retired at 51. No pension.

Counting Rental Real Estate as a portfolio asset:

Real Estate: 40%
Stocks: 25%
Bonds: 25%
Cash: 10%

Rental Income provides 55% of total cost of living.

Portfolio not including Rental Real Estate:

Stocks: 42.5%
Bonds: 42.5%
Cash: 15%
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90 days is generous
Old 06-15-2016, 08:21 AM   #74
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90 days is generous

I gave 9 months notice since I assumed they would need time to replace me. The first wave of resumes that were reviewed were looked at with about 100 days to go. The first serious interviews (there were some interviews of friends for influential people that were for courtesy only) were less than 60 days out, and the decision was made about 5 days after I left. So much for the long lead time. If I had to do it over again, I would have given 90 days notice (2 weeks required) and seen what offer they would have made to keep me for a few more months. I wasn't irreplaceable, but my skill combination was unique and I had long institutional knowledge that they didn't want to lose (they did anyway, but that is on them).
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Old 06-15-2016, 08:24 AM   #75
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OOPS, I posted this on the wrong topic. This was for the C-level topic.
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Old 06-15-2016, 09:07 AM   #76
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Location: san juan mountains
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Retired at 52, 5 years ago. Not collecting pension or SS yet. Will wait to 70 since we have much more cash flow then we need for expenses from portfolio. Thus, I keep it heavier in equities.

Current allocation is

72% stocks
22% bonds
6% cash
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Old 06-15-2016, 09:40 AM   #77
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Originally Posted by W2R View Post
Wow, I hardly see anyone here at all with pensions and SS covering all their expenses. Perhaps you were referring to someone in particular, but other than Flyboy (who posted after you did), I don't see these posts.

Even if there were a number of people like that posting, risk tolerance is a very individual matter and I would never encourage anyone to exceed their risk tolerance. I remember back in 2008, those of us who invested within our risk tolerance had a LOT of hand-holding to do with those who didn't. Unfortunately it wasn't always successful because a few members sold low, had to go back to work, and so on. To me that is tragic.
55% stocks, 36% bonds, 9% cash.

Basic living is covered by pension and the late DW's SS. All expenses will be covered at 70 in 3.5 years when I move to my SS.

In addition, I have ~17% of total total investments in bank accounts with half designated for house building/living funds and the other half for a charity project. The plan is to take the half for charity out as RMDs at 70.5 each year until the commitment is covered so it will impact investment allocations/rebalancing.
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Old 06-15-2016, 11:13 AM   #78
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Location: Texas
Posts: 805
Retired 3 years ago at 52. Target AA is in my signature. Actual is currently 50/30/17/3. Equities are 15% international and tilted to high-dividend on the domestic side. Bonds include a healthy dose of high-yield corporate. Real estate consists of two rental houses and a REIT ETF.

DW and I have pensions that cover 55-60% of current spending. One pension is non-COLA however, so that percentage is expected to drop over time. Rental income and taxable dividends cover the rest, unless we have some large non-recurring expenditure. Withdrawal rate is typically very low (0-1%). We'll likely delay SS until 70. Along with RMDs, income will far exceed expenses at that point.

Main purpose of the portfolio is to protect against inflation, longevity, and LTC. In all likelihood, the kids will make out like bandits.

AA by account (touchable/untouchable) is purely a function of tax efficiency.
Retired at 52 in July 2013. On to better things...

AA: 45% stock, 35% bonds, 15% real estate, 5% cash
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Old 06-15-2016, 11:33 AM   #79
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Originally Posted by scrabbler1 View Post
Do any of you really early retirees who can't tap into a pension, SS, or an IRA, have different AAs for currently untouchable (or very nearly so) assets than you do for your current, taxable portions?
It's one large portfolio to me. I don't really care if the assets are in IRAs or other accounts really (sure, I give some weight to the fact that certain taxes are different in/out of tax deferred accounts).

And the IRA isn't completely untouchable. DW can access her's if we needed to. I can in about 5 years. Don't really plan on it until RMDs kick in, and at that point it's simply shuffling money from one account to another (and of course paying taxes as this happens).
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Old 06-16-2016, 08:19 AM   #80
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DH's COLAed pension provides 118% of our expenses. It's 100% to me as the survivor. At 65 or 66 I will start SS which will add another 30% of our expenses. Total income will be close to 150% of expenses. We have a fairly low cost of living and don't need to withdraw anything from the assets, for now. We do take money out for major home improvements, etc.

Up until last month our AA was 14/4/82 with most of the cash being PenFed CDs at 3% and 5%.

Last month I inherited half of my Dad's IRA which is 14/81/5 with the 81% in high yield (high risk) bond funds. I will be moving the inherited IRA to Vanguard Wellesley (35/65) very soon.

I'm enjoying this thread because I'm undecided about what our asset allocation should be when I'm managing the new total sum. I'm reading and learning. I've always been very conservative (lots of CDs and cash) so I'm in a transition phase.

Dad's nice monthly dividends on his high risk bond funds sure are attractive. But then there's that one that went under a few years ago and he lost a small chunk of money.

So I guess my allocation is 33% reading/33% learning/33% thinking.

Married, both 61. DH retired June, 2010. I have a pleasant little part time job.
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