Moved money from stocks to guaranteed today.....good idea?

[kgtest]

If you don't have an Investment Policy Statement (IPS), then write one down. That's what keeps me from doing stupid things on a whim. Like pulling out after stocks drop 6%. Without it, I would still be buying naked puts and GE stock.

Here's mine. Hasn't changed much since I first wrote it. I read it when my bonus and RSU's vest and I am debating which supercar I NEED.

Objective: $XXM in retirement savings with a paid off house.

Asset Allocation (AA): 60% stocks / 40% bonds with 25% of stocks international

Rebalance when AA gets outside of 5% or annually

Invest in very low cost index funds

Live within retirement budget and save the rest.

Do backdoor Roth for myself and wife annually. Leave in cash in traditional IRA while waiting to roll over to Roth. Wait one week to do roll over to Roth to allow funds to clear. Once in Roth, lump sum investment into total stock market index fund.

Invest maximum allowed in 401k at a rate that maximizes company match. Use 401k to manage 60/40 AA. Invest only in low cost index funds where possible in 401k.

Invest maximum allowed in 401k after tax and do a mega backdoor Roth annually. Lump sum investment into total stock market index fund.

Invest 6% into company SSP II plan to get the 6% match.

Invest a minimum of $75k annually in taxable account.

Minimize current taxes by investing only in total stock and international stock index funds in taxable account. Tax free muni bond fund up to $50k is also allowed in the taxable account. Minimize taxes by concentrating bonds in 401k.

Maximize growth in Roth accounts by investing in total stock market index funds.

Restricted Stock Units (RSU): When RSU's vest, sell immediately and invest the money in a lump sum in accordance with my Asset Allocation (AA) in my taxable retirement account.

Bonus: Invest entire bonus each year in a lump sum in accordance with my Asset Allocation (AA) in my taxable retirement account.

Military Pension: Invest 100% of pension in taxable account.

Life Ins: Maintain multiple term life policies laddered until age 78. As savings becomes sufficient to maintain DW current lifestyle with low risk, policies will be allowed to end without renewal.

Inheritance: let my wife decide what to do after waiting three months.

I didnt see 'fund the pool build' or 'private pilots certification' in that plan... Are you sure?

 

[MrsHaloFIRE]

I didnt see 'fund the pool build' or 'private pilots certification' in that plan... Are you sure?

Oh it's a burn!!!!! This thread improves!!!

 

[donheff]

The only market timing a do is on big down days. I bought $56k of a 500 index on Monday’s plummet and again today. I had been slowly moving from 60/40 toward 70/30 so I will likely repeat the move as we go lower. I have a suspicion that this downturn will be prolonged but who knows.

 

[easysurfer]

I'm hoping for a trifecta, 3 consecutive days of Dow dropping over 1000 points. As of this moment, Dow is down about 826 points today.

 

[ddoorn]

Friday 2/21 I moved 1/3 from growth stock index adding to my bond fund index making it 2/3 of total funds, leaving 1/3 in total stock index for now.

I’m planning to move my remaining 1/3 out of total stock index into total bond index as things get more wobbly approaching the election. If #45 wins I’ll move back into stock indexes after November after the market settles down.

Don

 

[mickeyd]

My wizard machine is out for repair now so I'm unable to crank out an adequate response. Can machines get covid-19?