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Looking to fine tune investments and the amount of meaningful work
Old 03-09-2008, 11:04 AM   #1
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Looking to fine tune investments and the amount of meaningful work

I am in my mid forties; live out in the country with my wife and 2 young children, ages 3 & 7.

Am one of those people who really enjoys his work, but just wants to do less of it. Currently putting in 60-70 hour weeks. My version of early retirement is to ramp down down to 20-30 hour weeks and lead a better balance of work and life. More vacation, surfing, mountain climbing, hanging out with friends ; less work -- that would be perfect.

So will be trying to solve 2 major issues in the next couple of years.

The first is to arrange my investments so that I can withdraw some money from them if need be -- that's not been an issue I've had to solve yet. Looking to decrease volatility in the portfolio and potentially increase the amount of real estate, and high dividend stocks within the portfolio to accomplish this. Current asset allocation is 40% equities / 30% relative value (hedge funds) / 20% inflation sensitive (commodities, real estate, TIPs), 10% deflation sensitive (bonds). We've saved enough and paid down debt that we should be able to make this transition well on the current pace. I've been reading about the debates on the SWR and know better than to bring up a question on this issue in my first post.

The other issue is to get to the right level of meaningful work. Suffice it to say, without going into details that just going part-time in my current position won't work. There are ways to get there but not immediately. Starting or buying a business is an option that I'm also considering although am cognizant that getting to a 20 hour week owning a business would take a couple of years. Do have a few role models who currently have accomplished this that I can learn from. I would prefer to "ramp down" if possible rather than go "cold turkey" as I like my work. Look forward to understanding lessons from people who have accomplished this.

Well, am looking forward to learning and sharing with the community!!

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Old 03-09-2008, 11:30 AM   #2
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Welcome! You'll get tons of good advice here.

Someone who likes to climb mountains and surf? That sounds like you live somewhere on the west coast . . .

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Old 03-09-2008, 11:34 AM   #3
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Welcome gryffindor. Obviously a Harry Potter fan!

I'm interested to know why you are so heavily into hedge funds.
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Old 03-10-2008, 04:41 AM   #4
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On hedge funds, I've had access to funds that have been vetted by my employer who has invested in them for the last 25 years. Their track record has high returns, less volatility than equities even during the recent downturns in 2000-02. I could never pick them out or have access to the good ones on my own, but am taking advantage of a good thing.
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Old 04-06-2008, 11:37 AM   #5
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Now that I have been playing with FireCalc over the last week, I can better answer the hedge fund question quantitatively

The addition of hedge funds, inflation sensitive and deflation sensitive assets to equities is able to reduce the volatility of a portfolio down to 5-6% given 17 year history numbers I have returns and volatility for asset classes plus the hedge fund history.

When I run FireCalc, that does some pretty cool things. Still working on the numbers and I'll post them when I feel 100% confident with them.
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