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Old 11-18-2017, 09:31 AM   #41
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IMO OP expressed two psychological issues affecting investment performance:

(1) Severe aversion to risk and paper losses.
(2) Letting perfect be the enemy of good enough.

(1) by itself is not uncommon and can be overcome either with financial assistance to keep you on course when you're tempted to sell out during the next inevitable market dip, or by changing your allocation to be something that won't fall as much when the market crashes.

(2) when combined with (1) is really crippling. OP is struggling to make moves because he's afraid of the opportunity cost of locking in a certain CD rate, for example, which might get a little bit better if he just waits. The problem is, OP is wasting time waiting for an action over which he has control, and is continually losing money to inflation. Especially with his relatively short time horizon to retirement, staying in cash when OP needs to be generating some return is hazardous to his retirement health.

My recommendation would be to put some of that savings into a CD and forget about future rates because you're killing yourself sitting in cash this late in the game. Trying to play perfection in an imperfect game is crippling your ability to retire, IMO, particularly when combined with severe risk aversion.
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Old 11-18-2017, 01:12 PM   #42
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Quote:
Originally Posted by AndyS View Post
Hope you don't mind ... I kind of took some of the "noise" out of your OP & just broke it down to the pertinent facts.

Current retirement monies:
Simple IRA 58k
Pension fund balance: 26k
401k's: 21k

Savings: 183k
Total: 283k

Current Income: 140k
Years to desired retirement: 11
Expected SS income: 31k
Desired retirement income: 75k (-31k SS = 44k needed)


Well, you don't mention some other important factors such as:
  • current mortgage debt,
  • other debt
  • current living expenses (how much are you spending now)
  • anticipated large future medical expenses (you say your wife is "disabled"?)
  • possible future college or other expenses you'd like to pay for any kids
  • income security for the next 11 years on that 140k a year you currently earn

What's your plan to pay for health care after age 62 though?

Point being, it kind of depends some of the other factors I mentioned above.

(Also ... any way you can get that 26k out of that defunct union pension fund and put it in some other retirement tax-advantaged vehicle that you control? How much interest are you earning on that where it is?)
My mortgage has been paid off for 6 years now
no car loans no credit card debt or any other debts
living expenses and utilities run around 4 to 4.5k a month, and are expected to lower some in retirement.
no kids
job is a secure as it can be unless something goes south


I'm not sure yet about medical insurance for me between the ages of 62/65 but my wife is on medicare already so she is covered.

I have not looked into moving the money from my IBEW IO pension, not sure I can, but it's currently making 15.6% return between its allocations.

I would expect our medical expense to be our biggest hurdle in retirement, I have been calculating our future expenses at 500 a month for medical, but that might be to low.

I have the possibility of leasing my Master Electrical license after retirement for a possible 500 to 1k a month, but that's still an unknown at this point and is not being calculated into my retirement scenarios.
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Old 11-18-2017, 02:44 PM   #43
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So here is the magical advice.... in your IRAs and taxable accounts... move it all to Vanguard and invest it in Wellington... a ~60/40 managed fund with a solid track record and reinvest all dividends.... same thing with new money... and let it alone.

No tax problems investing that $100k in Wellington either other than dividends of probably $2-3k a year and much of those will be qualified dividends and taxed at a lower rate than your earnings from working.
^^^ Hey OP this is your magical advice right here! You cannot go wrong with Wellington. This is a long term plan you should execute today and for your last 10 years of working you will build principle that will produce income in retirement for you and your wife.

After you move your current cash into Wellington start dollar cost averaging your savings into this Wellington fund.

Just remember if and when we experience a major market correction you will be buying low with your dollar cost averaging.

Have a bucket of cash available and DO NOT touch the Wellington fund because the market always recovers.
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Old 11-19-2017, 07:54 AM   #44
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Rollover 401k's and pension into an IRA. Keep at least a year in cash and put the rest into a brokerage acct. Read the work less live more as an allocation idea, but follow a simplified approach of ETF's/mutual funds since I suspect you have no interest in stock picking. Vanguard and Schwab have the lowest fee structures.

Once the dust settles, run the FIREcalc and see where you stand.

Might take a few months for the transactions, but the paperwork and decisions can be done in a weekend or two.
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Old 11-20-2017, 11:07 AM   #45
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Originally Posted by purplesky View Post
^^^ Hey OP this is your magical advice right here! You cannot go wrong with Wellington. This is a long term plan you should execute today and for your last 10 years of working you will build principle that will produce income in retirement for you and your wife.

After you move your current cash into Wellington start dollar cost averaging your savings into this Wellington fund.

Just remember if and when we experience a major market correction you will be buying low with your dollar cost averaging.

Have a bucket of cash available and DO NOT touch the Wellington fund because the market always recovers.

Wellington VWELX is closed to new investors - any other suggestions?
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Old 11-20-2017, 11:30 AM   #46
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Wellington VWELX is closed to new investors - any other suggestions?
It is not closed if you buy it directly from Vanguard.
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Old 11-20-2017, 11:35 AM   #47
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It is not closed if you buy it directly from Vanguard.
I didn't know that. I learned something. Awesome.
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Old 11-20-2017, 11:39 AM   #48
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Hmm, I already have 2 IRA accounts with Scottrade... was thinking I would just keep these accounts and open a taxable account there, just to keep it simple. Or should I open accounts at Vanguard and roll these IRA's over?
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Old 11-20-2017, 08:27 PM   #49
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If you are going to continue contributing on a regular basis, open a Vanguard account. There are no commissions when you buy more.
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Old 11-20-2017, 10:38 PM   #50
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If you are going to continue contributing on a regular basis, open a Vanguard account. There are no commissions when you buy more.
^^^ Go for it! Dollar cost avg. into Wellington with your new Vanguard account.

You will be very happy in 11 years when you to retire.

Just remember to leave this account alone during market corrections or selloffs.
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Old 11-20-2017, 11:04 PM   #51
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Hmm, I already have 2 IRA accounts with Scottrade... was thinking I would just keep these accounts and open a taxable account there, just to keep it simple. Or should I open accounts at Vanguard and roll these IRA's over?
I would get into Vanguard Wellington first with a new Vanguard aftertax account and put your cash to work immediately .

You can always roll the Scottrade IRA accounts if you want.

You could open a IRA for 2018 at Vanguard and invest that also in Wellington.
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