explanade
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- Joined
- May 10, 2008
- Messages
- 7,442
Hi,
47-year old male, single, looking at how green the grass seems on the other side of the fence.
In the tech industry, have vested stock options which are worth about $2.5-2.7 million net, pre-tax.
401k is about $255k, have about $350k cash and various equities, mostly in mutual funds, worth about $110k in taxable accounts, another $25-30k in IRAs.
Only debt is $185k mortgage. Home is worth over $700k according to Zillow.
Very risk-averse and current markets make me leery about putting money in. About a month ago, it was noted that the S&P had been flat for 10 years.
Had a free consultation with Smith Barney guys, who ran a Monte Carlo simulation. They proposed privately managed accounts, costing 1% management fees, with 30% bonds and rest equities.
Not convinced of their forecasts or whether they're worth 1%.
I know it's ultimately a bad deal but looked at income annuities through Vanguard, which for my age return about 6.5-6.9 cents on the dollar, of which about 40% is excludable from taxes (i.e., withdraw from principal). So the return they're giving you is about 3% of withdraw of principal and 3.5-3.9% return.
Only reason to consider it is peace of mind. Idea of going for higher returns in equities and fixed-income, after the dot-com bust and the current market is unappealing.
Main concerns are higher inflation and uncertainty about health care costs, as well as leery view of markets.
Standard of living is very middle-class. Only extravagance is travel. The budget I came up with is about $50-55k a year, which would include $6k for health insurance premiums (just rough guess), all taxes and insurance, maybe about $10-12k of discretionary spending.
So this budget seems very reachable, just by putting a bunch of money from my stock options proceeds into the annuity. Would not touch equity in the house, 401k or my current equities investments. Would still have about $500k of my stock options proceeds as well.
I would expect that most people here would say I'm aiming too low with this "safe" strategy.
47-year old male, single, looking at how green the grass seems on the other side of the fence.
In the tech industry, have vested stock options which are worth about $2.5-2.7 million net, pre-tax.
401k is about $255k, have about $350k cash and various equities, mostly in mutual funds, worth about $110k in taxable accounts, another $25-30k in IRAs.
Only debt is $185k mortgage. Home is worth over $700k according to Zillow.
Very risk-averse and current markets make me leery about putting money in. About a month ago, it was noted that the S&P had been flat for 10 years.
Had a free consultation with Smith Barney guys, who ran a Monte Carlo simulation. They proposed privately managed accounts, costing 1% management fees, with 30% bonds and rest equities.
Not convinced of their forecasts or whether they're worth 1%.
I know it's ultimately a bad deal but looked at income annuities through Vanguard, which for my age return about 6.5-6.9 cents on the dollar, of which about 40% is excludable from taxes (i.e., withdraw from principal). So the return they're giving you is about 3% of withdraw of principal and 3.5-3.9% return.
Only reason to consider it is peace of mind. Idea of going for higher returns in equities and fixed-income, after the dot-com bust and the current market is unappealing.
Main concerns are higher inflation and uncertainty about health care costs, as well as leery view of markets.
Standard of living is very middle-class. Only extravagance is travel. The budget I came up with is about $50-55k a year, which would include $6k for health insurance premiums (just rough guess), all taxes and insurance, maybe about $10-12k of discretionary spending.
So this budget seems very reachable, just by putting a bunch of money from my stock options proceeds into the annuity. Would not touch equity in the house, 401k or my current equities investments. Would still have about $500k of my stock options proceeds as well.
I would expect that most people here would say I'm aiming too low with this "safe" strategy.