We have slowly evolved our retirement portfolio to a major dependence on balanced funds. Retired in 2000 and have been withdrawing from IRA where most of our money is since 2005.
Balanced funds provide on-going income stream while doing the heavy lifting on stock/bond re-balancing. As we get older the active re-balancing becomes a lot less attractive to us.
We are currently thinking of eventually having 3 asset allocation "buckets" (not to be confused with the Lucia discussions):
Stock - to directly hold REIT and International
Reserve - to directly hold very safe non-stock (IBonds, CDs, etc) and
Balanced
Thinking balanced would be an equal allocation between Wellesley and Wellington or allocated like Wellington (i.e., Wellesley mirror image) balanced fund(s). This would make the balanced bucket 50/50 stock bond and allow the Stock/Reserve allocations to "true up" to desired overall stock/ bond allocation.
Anyone doing something similar to this or comments on the approach?
thanks! bill
Balanced funds provide on-going income stream while doing the heavy lifting on stock/bond re-balancing. As we get older the active re-balancing becomes a lot less attractive to us.
We are currently thinking of eventually having 3 asset allocation "buckets" (not to be confused with the Lucia discussions):
Stock - to directly hold REIT and International
Reserve - to directly hold very safe non-stock (IBonds, CDs, etc) and
Balanced
Thinking balanced would be an equal allocation between Wellesley and Wellington or allocated like Wellington (i.e., Wellesley mirror image) balanced fund(s). This would make the balanced bucket 50/50 stock bond and allow the Stock/Reserve allocations to "true up" to desired overall stock/ bond allocation.
Anyone doing something similar to this or comments on the approach?
thanks! bill