Question for current retirees

[RockyMtn]

58, retired at 51. 60% stock, 38% bonds, 2% cash. Have a non cola'd pension now. Another one at 65. SS at 70. Pension, dividends and BOD fees pay the bills.

 

[SteveNU]

Retired 3 years ago at 56 and worked part time until the end of last year.

Non cola pension covers ~60% of our budget
My SS at 62 will cover ~35% of our budget
Wife retires in a few months at 55 and will have a small cola pension that will provide beer money
Wife's SS at 62 will cover ~20% of our budget
So we have 115% of our budget covered when all of those sources are on line.

Currently about 65/35/5, stocks, bonds, cash in our retirement accounts which will be our fun/spoil the kids and grandkids money



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[LitGal]

I have a survivor's pension from DH, my own STRS, plus SS. Assets allocated roughly 35% stocks/ 45% bonds/ 20% cash. Because of the pensions, I aim for the investments to simply stay ahead of inflation in case I need to start tapping them 15-20 years from now.
The cash helps me sleep at night.

 

[fritz]

We retired at 58/57 (7 years now). No pensions. We both took SS at 62. My SS and our taxable dividends covers base living expenses. Wife's SS is travel funds/extras (as it goes away when one of us does). Own home - no debts. Investments are 35% taxable, 49% IRA, 12% Roth, and 4% cash in bank savings acct. Stock bonds are at 52/48.

 

[ejman]

Currently 65 retired at 52. 50/50 equities/bonds rebalanced as needed (seldom) within 10% band. Started SS at 62, tiny corp pension of $400/mo which started at 65.

 

[blenhardt]

MY allocation is 40/30/30. Age 70 retired for three years. Yes, very conservative. We believe we have enough and want to minimize loses if the big one comes. With two non-cola'd pensions and SS we only need savings for extras now. Will start to need it as inflation picks up.

 

[frayne]

Interesting read that kind of dovetails into this thread.
Forbes Welcome

 

[Dog]

I will be following this thread as DH and I need to sit down and discuss where we are from an allocation perspective.
I retired in 2014 (56) and DH retired last month (58). We are the same age. He will receive a small pension (FERS) and has a respectable TSP balance. His FERS and supplement will cover about about 50% of our current expenses. I started a 72t in 2015 and it will cover remaining expenses, extras and allow funneling some to our Roths (Roth conversion).

Our breakdown is (not including FERS pension and supplement):
59% my IRA
18% DH TSP
6% CDs
5% My 401k
2% Roths
10% cash (50% of this pending sale of primary home)

We also have 3 cars that are paid for as is our retirement home.

In 4 years DH will move from supplement to SS at 62 and the pension will then be COLA'd. My 72t requirement will be fulfilled and depending on economy and finances I will decide if I take SS. If I opt for SS at 62, then SS & pension will cover expenses. Investments will be frosting and we are hoping to leave a decent estate for DD.



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[daylatedollarshort]

You have to be careful with those "loss aversion" people... $10 in gains isnt worth the risk in pain of a potential dime loss.

I don't know about Walt34's wife, but for me it is not losing dimes - it is losing multiple years worth of living expenses that I would prefer to avoid.

 

[Mulligan]

I don't know about Walt34's wife, but for me it is not losing dimes - it is losing multiple years worth of living expenses that I would prefer to avoid.

Oh, Im with you... I am extremely conservative and "by the book" I should be considerably more aggressive...No thank you... I was just taking the loss aversion idea down to a trivial daily spend level.


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[scrabbler1]

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?

 

[gayl]

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%

 

[papadad111]

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.

 

[NanoSour]

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 ******** 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.

 

[Done]

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.

 

[mathjak107]

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

 

[Golden sunsets]

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.

 

[misshathaway]

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.

 

[gerntz]

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 $.

 

[athena53]

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!

 

[friar1610]

-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.

 

[BarbWire]

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?

 

[jkern]

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%

 

[Taxman59]

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).

 

[Taxman59]

OOPS, I posted this on the wrong topic. This was for the C-level topic.