What's your Asset Allocation plan for 2022 ? 2023 ?

[dvalley]

70/0/30 -never understood bonds, so always stayed away.

I plan to retire in the next 3-5 yrs so I'm holding approx 8-10 years in cash which I can also use towards buying a retirement house a bit more rural and still keep the current one in the city.

 

[Sanstar]

85% low cost SP 500 and NASDAQ ETF. Keep 5 years of annual WD’s in short term annuities. I rebalance to cash and use this to buy the dips. Out of cash at the moment thanks to lots of recent dip buying opportunities.

Retired 6 years with lots more to come. I hope?

 

[skyking1]

61, 80/20
We had more cash but invested in our retirement property. We are not going to make adjustments till after the sale of this home and build of the new one. Lots of dust to settle over the next 18 months.
I suspect we will have a net surplus that will square the AA up a bit.

 

[Telly]

60/40 for years, no plans to change now or in the future. I include REIT index in with equities for the ratio.

 

[Dtail]

Currently at 47/50/3 with CD's and Stable Value filling the Fixed Income portion.

 

[mrfeh]

60/40 ad infinitum.

Current headlines should not affect this answer.

 

[BuysToys]

We're at 65/30/5. There is no plan to change at this time, but we are always willing to re-evaluate based on needs. If anything, we'd likely move more bonds to cash.

 

[target2019]

We're at 50/44/6.

World events won't cause much of a change in our target. We do intend to let it float up to 60% equities. If that doesn't happen, we'll rebalance into equities.

 

[FLSUnFIRE]

Excluding short term cash (varies between 1.5x expenses to .2x expenses throughout the year) I am using the following formula in these times:


Equities=100%x(my age/my age)-((Age of the Federal Reserve Chair/Current National Debt at the start of the year)x(Number of assaults at the Oscars the prior year)x(Cost of a barrel of Brent crude on April First of the prior year+Cost of a Tesla Model S motor oil change)x0)


I have a long time horizon so I'll keep riding equities.... Day to day volatility/down periods don't bother me yet! Inflation is a concern to me (also why I have no interest in FI/Debt -along with rising interest rates) and I am feeling a bit guilty spending these days (still do but with less confidence).

 

[Digger1000]

99.43% stocks as of today. Its almost all S&P 500 Index Funds. I do have about 1.75% in a semiconductor fund. I retired 5 years next Sunday at age 51. The lowest I've been in stocks since retiring is 97%.

 

[aja8888]

Excluding short term cash (varies between 1.5x expenses to .2x expenses throughout the year) I am using the following formula in these times:


Equities=100%x(my age/my age)-((Age of the Federal Reserve Chair/Current National Debt at the start of the year)x(Number of assaults at the Oscars the prior year)x(Cost of a barrel of Brent crude on April First of the prior year+Cost of a Tesla Model S motor oil change)x0)


I have a long time horizon so I'll keep riding equities.... Day to day volatility/down periods don't bother me yet! Inflation is a concern to me (also why I have no interest in FI/Debt -along with rising interest rates) and I am feeling a bit guilty spending these days (still do but with less confidence).

Don't forget to factor into your equity formula the number of times FED Chair Powell said "this inflation is transitory" during the 2021 FED Meetings.

 

[Bigdawg]

Excluding short term cash (varies between 1.5x expenses to .2x expenses throughout the year) I am using the following formula in these times:


Equities=100%x(my age/my age)-((Age of the Federal Reserve Chair/Current National Debt at the start of the year)x(Number of assaults at the Oscars the prior year)x(Cost of a barrel of Brent crude on April First of the prior year+Cost of a Tesla Model S motor oil change)x0)


I have a long time horizon so I'll keep riding equities.... Day to day volatility/down periods don't bother me yet! Inflation is a concern to me (also why I have no interest in FI/Debt -along with rising interest rates) and I am feeling a bit guilty spending these days (still do but with less confidence).

Someone should do stand up comedy strictly talking financials. I vote you.

 

[big-papa]

I don't make an asset allocation plan based on what year it is. It is and always will be 60/40. Aka Staying the course.

 

[CRLLS]

So FLSUnFIRE, Your triggers are way too complicated for a self-investor to manage. You need an FA to track all of that for you. Ha Ha! You are 100%*1-0 in equities huh?

 

[disneysteve]

With a volatile 2022 (inflation, higher interest rates, the Ukraine war, BA variants, etc)

My asset allocation isn't based on any of this stuff.

 

[Dtail]

Excluding short term cash (varies between 1.5x expenses to .2x expenses throughout the year) I am using the following formula in these times:


Equities=100%x(my age/my age)-((Age of the Federal Reserve Chair/Current National Debt at the start of the year)x(Number of assaults at the Oscars the prior year)x(Cost of a barrel of Brent crude on April First of the prior year+Cost of a Tesla Model S motor oil change)x0)


I have a long time horizon so I'll keep riding equities.... Day to day volatility/down periods don't bother me yet! Inflation is a concern to me (also why I have no interest in FI/Debt -along with rising interest rates) and I am feeling a bit guilty spending these days (still do but with less confidence).

I think you are missing a ) sign, otherwise it looks reasonable.

 

[rdy4er]

60/35/5 Stocks/Bonds/Cash age 56, recently retired, no plans to change

 

[Out of Steam]

Going to stay fairly conservative through the next year or two, with plans to increase equity exposure gradually after that. Just under 30% stock, 8% ESOP, the remainder in fixed income (TIAA Traditional/TSP G Fund). Can't afford a major market hit while taking a 4.5% draw pre-Social Security.

Biggest 2022-23 goal is not to let equity exposure decline, rebalancing if stocks decline and reinvesting proceeds of a required partial ESOP sale in stock.

 

[24601NoMore]

25/13/62 @ Ages 58/64 with the Cash being mostly CDs, MYGAs and other investments that generate enough income to pay our bills. The 25/13 is "upside" and not needed for living expenses.

38% in "risk assets" is WAY more than we "need", and I'm not interested in riding out another 50+% market drop anytime in this lifetime. Even 38% is more than I want, and I'd be happy at 25-30% risk assets and the rest in "safe" income generating investments (yes, I'm accounting for and taking inflation into account in my plan).

FWIW, I do think it'd be prudent to pay attention to what Mr. Market is telling us. The 2/10s just inverted today. Fed Governors are talking every day about 50 bps hikes yet this year. One Fed Governor today said his target FFR rate by end of year is "at least" 3%. PPI is going bonzo and many expect near term CPI to be at all time highs (even higher than current ~8%). Recession is now VERY likely within 6-9 months (2/10 yield curve inversion being just one of many indicators pointing to this). Plus, valuations are still at the second highest in history. Ignore all that "noise" if you want, but Mr. Market is telling us all LOUD and clear that "Winter is Coming"..

Taking proactive actions in light of economic and other indicators is more "Risk management" than "Market Timing" IMHO. I would never go 100% cash - but I sure would make (and am already making) portfolio changes that are sensible if the indicators are flashing neon that it'd be prudent to do so.

ETA: there was a good article out today where B of A is saying S&P sub 4K is far more likely than S&P 5K this year. Food for thought. The number I've seen talked about the most is S&P ~3,600. That'd sting, and if we do go into a prolonged recession, it could be quite a while until we see current levels again. Note that B of A does think we'll have a few more weeks of upside that represent a fantastic selling opportunity before things turn south..FWIW.

 

[aja8888]

25/13/62 @ Ages 58/64 with the Cash being mostly CDs, MYGAs and other investments that generate enough income to pay our bills. The 25/13 is "upside" and not needed for living expenses.

38% in "risk assets" is WAY more than we "need", and I'm not interested in riding out another 50+% market drop anytime in this lifetime. Even 38% is more than I want, and I'd be happy at 25-30% risk assets and the rest in "safe" income generating investments (yes, I'm accounting for and taking inflation into account in my plan).

FWIW, I do think it'd be prudent to pay attention to what Mr. Market is telling us. The 2/10s just inverted today. Fed Governors are talking every day about 50 bps hikes yet this year. One Fed Governor today said his target FFR rate by end of year is "at least" 3%. PPI is going bonzo and many expect near term CPI to be at all time highs (even higher than current ~8%). Recession is now VERY likely within 6-9 months. Plus, valuations are still at the second highest in history. Ignore all that "noise" if you want, but Mr. Market is telling us all LOUD and clear that "Winter is Coming"..

Taking proactive actions in light of economic and other indicators is more "Risk management" than "Market Timing" IMHO. I would never go 100% cash - but I sure would make (and am already making) portfolio changes that are sensible if the indicators are flashing neon that it'd be prudent to do so.

ETA: there was a good article out today where B of A is saying S&P sub 4K is far more likely than S&P 5K this year. Food for thought. The number I've seen talked about the most is S&P ~3,600. That'd sting, and if we do go into a prolonged recession, it could be quite a while until we see current levels again. Note that B of A does think we'll have a few more weeks of upside that represent a fantastic selling opportunity before things turn south..FWIW.

I'm thinking along the same lines you are. I'm around 26% equities right now. I priced a one year treasury today and it yields 1.92%. Once a couple more rate hikes are in, I am loading up my cash bucket with those.

 

[24601NoMore]

I'm thinking along the same lines you are. I'm around 26% equities right now. I priced a one year treasury today and it yields 1.92%. Once a couple more rate hikes are in, I am loading up my cash bucket with those.

Have you looked at MYGAs? Current rates from really solid companies (New York Life, Mass Mutual and others) are 2.7 for 3-year, 3% for 4-year and 3.2% for 5 year.

I hold bond funds that I had hoped to get 3% yield on. Stupidly did "buy and hold" even though I knew rates were headed skyward. Yeah, they're all getting crushed.

Or, I can (and have) buy a 3+% MYGA with minimal risk and stability of principal. Plus, interest is tax deferred until I pull it out which gives me better control over yearly MAGI for "A"CA and other purposes..

ETA - 1.92% for a 1-year Treasury is also pretty sweet..I'm gonna have to start looking at T-Bills..

 

[aja8888]

Have you looked at MYGAs? Current rates from really solid companies (New York Life, Mass Mutual and others) are 2.7 for 3-year, 3% for 4-year and 3.2% for 5 year.

I hold bond funds that I had hoped to get 3% yield on. Stupidly did "buy and hold" even though I knew rates were headed skyward. Yeah, they're all getting crushed.

Or, I can (and have) buy a 3+% MYGA with minimal risk and stability of principal. Plus, interest is tax deferred until I pull it out which gives me better control over yearly MAGI for "A"CA and other purposes..

ETA - 1.92% for a 1-year Treasury is also pretty sweet..I'm gonna have to start looking at T-Bills..

I sold my one bond fund last year, an intermediate term Muni fund as I suspected the fed funds rates would be heading up. I'm pricing MYGA'a and waiting for a bit.

 

[24601NoMore]

I sold my one bond fund last year, an intermediate term Muni fund as I suspected the fed funds rates would be heading up. I'm pricing MYGA'a and waiting for a bit.

Good call on your part. Wish I'd done the same, but I (stupidly) did the "buy and hold forever, no matter what" thing and am now getting crushed even more on my bond funds than my S&P500 fund. Doh!

I do wonder what's gonna happen with MYGA rates. Hard to imagine the 10-year is going above 2.5%, which it almost hit the other day. So isn't it more likely rates will come down from this (hopefully temporary) pop?

I've heard some pro money managers that know far more than I ever will buying long bonds hand over fist right now counting on the 10, 20 and 30 to nosedive from these levels, which would obviously produce some hefty cap gains..if that does happen, I'd expect MYGA rates to fall also.

Not 100% sure, but I suspect MYGA rates will be more influenced by long (10+ yr) yields than the short end of the curve..but if anyone knows for sure, would welcome any and all info on that.

 

[daylatedollarshort]

I've got a lot of spare cash in short term, zero coupon Treasuries and stable value funds right now. Since we have relatively low spending and a lot of NW in real estate (house, can't change it without moving), and a TIPS ladder we come out ahead with high interest rates / inflation. I'm looking forward to buying longer duration TIPS later in the year at nice yields. I dumped the bond funds earlier this year and switched the stocks to a dividend fund. We refinanced a mortgage last year and are enjoying the under 3% loan cost while the TIPS are earning around 9%. We have individual TIPS we plan to hold to maturity so the drop in price doesn't really matter to us, since we will get the inflation adjusted principal at maturity no matter the price ups and downs along the way.

 

[Koolau]

Heh, heh, I never thought it would happen. Finding folks with lower equity positions than I have. YMMV