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Old 12-29-2015, 01:42 PM   #21
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Bingo. I am in the OP's situation: Pension covers living+a bit. My stash is just there to cover whatever the pension doesn't cover in any given year if something comes up or maybe I want to treat myself.

I keep my money in a standard 50/50 asset allocation.
+1

I essentially leave all funds invested unless I want to buy a big ticket item (auto, RV, boat, etc). Although LTC is the wildcard, I am guessing my pension would even cover a large piece of that when the time comes since I am single with only myself to worry about.
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Old 12-29-2015, 01:54 PM   #22
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My pension and rental income cover my expenses. I keep about a year's spending in my bank account and the rest of my portfolio is divided 30/70 between TIAA-Traditional (instead of bonds) and low cost equity index funds.
I reinvest all dividends and interest and when it starts I'll put a lot of my SS into equities too. I intend for my equity percentage to increase as I get older.
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Old 12-29-2015, 04:33 PM   #23
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My mom's expenses are covered by pensions/SS. She was in all stocks, but I moved her to 24% bonds when she pulled out some for gifting and indicated she may need to fix the roof. The reasoning for all stocks was that the money was just being held for the kids, so let it grow. Better than 30 years sitting in bonds, I hope.
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Old 12-30-2015, 02:08 AM   #24
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Let it grow, let it grow, let it grow.

We will be in this fortunate situation once my pension kicks in (2 years.) We will not change the investment selection.
We have no expensive desires. So why change what worked so far?
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Old 12-30-2015, 07:40 AM   #25
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In this scenario i.e. if pension covers my expenses, I will continue my investment portfolio. I will reinvest the interest/ capital gain/ dividend. I will wholeheartedly spend the interst on interst every month ... without losing my original investment and its interest.
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Old 12-30-2015, 08:08 AM   #26
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If your pension covers 100% of your expenses, then it seems to me that instead of a retirement portfolio, it's just a regular investment portfolio.

I not only would NOT withdraw from it (why?) but also I would invest it differently. With all expenses covered, I don't see any reason to lower risk. Ironically, it seems that those who need the lowest risk are those who need the money to live on and can least afford low returns. Oh well, such is life.

Anyway, since I wouldn't be needing any of the money in it, I'd probably invest 100% in equities .
This is pretty much what I am doing. My pension does indeed cover all my expenses, so I have remained aggressive in my investments. I considered changing my allocation to put some in bonds, etc., but I am just not satisfied with the lack of money you make that way. I don't have an "end goal" for how much $$$ I want to accumulate, but when the DW decides to retire, then I don't want to skimp on travel expenses. It's expensive to fly business class from ATL to New Zealand, but that's the only way I will go. As I grow a little older, I will probably start shuffling the portfolio to safer alternatives, but not anytime soon.
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Old 12-30-2015, 08:19 AM   #27
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We all know people, a lot of people, who are spend thrifts. Every dollar they have burns a hole in their pocket. What amazes me is how conservative, almost to the point of being cheap, most people here are.

We all lived below our means, saved and invested to get where we are, but once we get there why not enjoy a little? If you are retired with a pension that covers all of your expenses and have another million in your portfolio why wouldnt you enjoy it?

That boggles my mind and I dont see it as any more strange than people who spend everything they have. Its like they are trying to prove a point or something. We are in financial situation like this and we retired and immediately increased our standard of living to a still safe, but higher standard commensurate with our income.

We moved to a new area that we couldnt safely have afforded before retirement, leased a new convertible that we had wanted for a while, greatly increased out travel budget, we eat out much more, go out to listen to live music and order $12 martinis that we wouldve never had before without thinking about how over priced they are. I bought a $1000 guitar when a $600 guitar wouldve done just fine (and my $250 guitar had done just fine for 20 years). I know some people will say none of those things bring them extra enjoyment, but I feel sorry for those people who have nothing else in their life to look forward to. Dreaming of things you would want to do or places you would want to visit is normal. Depriving yourself of those things when you can easily afford them is not normal. We all need extra enjoyment and if we can afford it, we should take advantage.
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Old 12-30-2015, 08:23 AM   #28
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We all know people, a lot of people, who are spend thrifts. Every dollar they have burns a hole in their pocket. What amazes me is how conservative, almost to the point of being cheap, most people here are.
I take it you aren't in that category, but it's clear you didn't spend any money on a Dale Carnegie course!
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Old 12-30-2015, 08:29 AM   #29
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We all know people, a lot of people, who are spend thrifts. Every dollar they have burns a hole in their pocket. What amazes me is how conservative, almost to the point of being cheap, most people here are.

We all lived below our means, saved and invested to get where we are, but once we get there why not enjoy a little? If you are retired with a pension that covers all of your expenses and have another million in your portfolio why wouldnt you enjoy it?

That boggles my mind and I dont see it as any more strange than people who spend everything they have. Its like they are trying to prove a point or something. We are in financial situation like this and we retired and immediately increased our standard of living to a still safe, but higher standard commensurate with our income.

We moved to a new area that we couldnt safely have afforded before retirement, leased a new convertible that we had wanted for a while, greatly increased out travel budget, we eat out much more, go out to listen to live music and order $12 martinis that we wouldve never had before without thinking about how over priced they are. I bought a $1000 guitar when a $600 guitar wouldve done just fine (and my $250 guitar had done just fine for 20 years). I know some people will say none of those things bring them extra enjoyment, but I feel sorry for those people who have nothing else in their life to look forward to. Dreaming of things you would want to do or places you would want to visit is normal. Depriving yourself of those things when you can easily afford them is not normal. We all need extra enjoyment and if we can afford it, we should take advantage.
I don't necessarily agree with this. My Dad is very conservative with his money and will most likely die leaving behind a large portfolio. It's not a case of "Look at me!", he's exactly the opposite of that. If he doesn't need it, he just doesn't buy it. As an example...he spends a LOT of his day on the computer. He has had the same 17" monitor for YEARS and so for Xmas, I got him a big 'ole 27". He was miffed at the fact that his 17" was "good enough" and that's why he "has glasses". Material things simply bother him; he doesn't want for anything. What HE DID WANT was financial security. He wants to know that NO MATTER WHAT, his expenses will ALWAYS be taken care of. When my Mom got ill (extended, for several years) she was able to STAY HOME. When it got bad (2 years worth), they were able to afford 24 hour in-home care. How many people could afford 24 hour IN HOME care for 2 years? Not very many, I would guess.

So...it's not wise to paint with a broad brush as to what OTHER people do with their money. It's not yours, it's theirs. In the end, the ONLY person that needs to be satisfied when the appointed hour comes is the one they see in the mirror.
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Old 12-30-2015, 08:45 AM   #30
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Really faced this question when I retired 9 years ago. Pension started after 6 years and would cover what most people would consider an affluent lifestyle. Had enough cash on hand to fund the first 6 years. So now the portfolio has grown quite a bit and we have set our lifestyle to the sum of divs and pensions (includes a large giving component). I really treat the portfolio as something we draw income from but manage for the next generation. Consequently have invested in 100% equities.

Alternatives considered include a charitable foundation, trust structures, etc, but so far have kept it simple.
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Old 12-30-2015, 08:48 AM   #31
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Interesting thought, but... We expect to withdraw less than SWR, but 100% covered by a pension is science fiction to me too. I don't think we'd change from our current AA, but there is no right answer.

Having a different POV is absolutely fine, but 'feeling sorry' for others POV and assuming they're 'deprived' is wrong...

Some may value splurging, while others may value the extra security of excess resources more. I suspect most of us fall somewhere in between. We can't know what unexpected expenses might arise (LTC just one example), so 100% covered is theoretical.
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Old 12-30-2015, 08:50 AM   #32
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We all know people, a lot of people, who are spend thrifts. Every dollar they have burns a hole in their pocket. What amazes me is how conservative, almost to the point of being cheap, most people here are.

We all lived below our means, saved and invested to get where we are, but once we get there why not enjoy a little? If you are retired with a pension that covers all of your expenses and have another million in your portfolio why wouldnt you enjoy it?

That boggles my mind and I dont see it as any more strange than people who spend everything they have. Its like they are trying to prove a point or something. We are in financial situation like this and we retired and immediately increased our standard of living to a still safe, but higher standard commensurate with our income.

We moved to a new area that we couldnt safely have afforded before retirement, leased a new convertible that we had wanted for a while, greatly increased out travel budget, we eat out much more, go out to listen to live music and order $12 martinis that we wouldve never had before without thinking about how over priced they are. I bought a $1000 guitar when a $600 guitar wouldve done just fine (and my $250 guitar had done just fine for 20 years). I know some people will say none of those things bring them extra enjoyment, but I feel sorry for those people who have nothing else in their life to look forward to. Dreaming of things you would want to do or places you would want to visit is normal. Depriving yourself of those things when you can easily afford them is not normal. We all need extra enjoyment and if we can afford it, we should take advantage.
A man after my own heart but this will not sit well with the people here. Spending money unnecessarily is a mortal sin. Didn't you learn that somewhere?
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Old 12-30-2015, 09:12 AM   #33
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So...it's not wise to paint with a broad brush as to what OTHER people do with their money. It's not yours, it's theirs.
Well said.
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Old 12-30-2015, 09:32 AM   #34
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We all lived below our means, saved and invested to get where we are, but once we get there why not enjoy a little? If you are retired with a pension that covers all of your expenses and have another million in your portfolio why wouldnt you enjoy it?
You don't have to spend money to "enjoy it". I plan to be in an accumulation stage right through retirement so I can leave money to a couple of charities and my nieces. Knowing that my money will be helping them when I'm dead makes me feel better than buying a bigger car.
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Old 12-30-2015, 09:45 AM   #35
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I can understand why people want to save more, or invest more for the future if they have concerns about higher expenses in old age like LTC, or they want to leave a goodly amount to their children/heirs/charities.

We try to do both. Our withdrawal rate is conservative compared to our net worth. Most of our net worth is in long term investments. So we set aside unspent budget for near term spending - splurges, travel, buying a nicer car than we might otherwise, more gifting.

We also gift to charities and siblings every year. They can use the money now, not just after we're gone.
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Old 12-30-2015, 10:11 AM   #36
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For me I would increase spending so most of the money gets spent over my lifetime. I might keep enough aside in case I need someone to assist me later in life.
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Old 12-30-2015, 10:13 AM   #37
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We all know people, a lot of people, who are spend thrifts. Every dollar they have burns a hole in their pocket. What amazes me is how conservative, almost to the point of being cheap, most people here are.

We all lived below our means, saved and invested to get where we are, but once we get there why not enjoy a little? If you are retired with a pension that covers all of your expenses and have another million in your portfolio why wouldnt you enjoy it?

That boggles my mind and I dont see it as any more strange than people who spend everything they have. Its like they are trying to prove a point or something. We are in financial situation like this and we retired and immediately increased our standard of living to a still safe, but higher standard commensurate with our income.

We moved to a new area that we couldnt safely have afforded before retirement, leased a new convertible that we had wanted for a while, greatly increased out travel budget, we eat out much more, go out to listen to live music and order $12 martinis that we wouldve never had before without thinking about how over priced they are. I bought a $1000 guitar when a $600 guitar wouldve done just fine (and my $250 guitar had done just fine for 20 years). I know some people will say none of those things bring them extra enjoyment, but I feel sorry for those people who have nothing else in their life to look forward to. Dreaming of things you would want to do or places you would want to visit is normal. Depriving yourself of those things when you can easily afford them is not normal. We all need extra enjoyment and if we can afford it, we should take advantage.
You probably don't need to get all your money back from that whole Brooklyn weekend rental thingie then?

Because pension (survivor gets same amount) and SS from highest earner amply covers our routine living expenses, we travel on our dividends from our 40/60 portfolio. If we stayed home more, we would reinvest them. We don't go out of our way to indulge ourselves but I notice we no longer consider pricing when we want something--weird to find we don't look at the righthand column on the menu of life anymore. We have kicked up our charitable donations a lot too.
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Old 12-30-2015, 10:22 AM   #38
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A man after my own heart but this will not sit well with the people here. Spending money unnecessarily is a mortal sin. Didn't you learn that somewhere?

I don't believe it is perceived so much as a "mortal sin" as other people may find no "utility value" in it. As an example, lets use the $12 martini. If you have the money and choose to buy or not buy it instead of an $8 shelf drink, isn't so much depriving yourself as it is individuals perceived value in the purchase.
I am never going to "waste" money on a $50 bottle of wine, because I enjoy the taste of the $10 ones... Spending a $100 on a bottle will not increase my pleasure in the drink. But that is just me, and I do not feel deprived at all.
But on the other hand, I am sure I blow money on things wealthier people would not. They in turn on this purchase would not perceive the "utility value" I do in it.


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Old 12-30-2015, 10:25 AM   #39
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So...it's not wise to paint with a broad brush as to what OTHER people do with their money. It's not yours, it's theirs.
Really? Because people here do it all the time when they make fun of their relatives who spend every cent they have.
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Old 12-30-2015, 10:29 AM   #40
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You probably don't need to get all your money back from that whole Brooklyn weekend rental thingie then?
No I didnt need that money back solely for the sake of having the money back. That was about principal. I dont mind spending money. I just dont like wasting it or having it stolen from me.

PS..I won that dispute.
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