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Old 06-05-2017, 06:00 PM   #21
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That would be assuming 100% investment in the S&P 500 - correct?
Yes, good point. If a large portion is in fixed income that would bring down the overall return.

But the comment about "He's buying and selling all sorts of stuff. I get trade confirmations more often than statements" is typically what we see when companies like Merrill Lynch, Edward Jones, or Ameriprise get involved with managing an account and generate excessive fees for themselves by constantly trading stocks.

It may all be fine, but it would be a huge warning sign if someone brought it to me to look at. I know of no good strategy that involves buying and selling all sorts of stuff. And if it's the advisor doing it, that is highly suspicious.
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Old 06-05-2017, 06:01 PM   #22
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I've been moving cash to short term bond. In fact I'm glad I made that decision when it was down. I hate to buy anything when it's up. I set my AA at 60/40, but I will take my time getting there. I checked and Vanguard shows something like up 7-8% YTD, I don't know whether to believe it or not. Low risk, decent return, that's how I like it.
But I trade less often on my Scottrade account than previous years. But it's up much higher than my Vanguard account. But it's all paper gain. A Whee from W2R would bring it down.
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Old 06-05-2017, 06:04 PM   #23
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I don't pay any trading fees, just percent of AUM.
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Old 06-05-2017, 06:24 PM   #24
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Stockpile food and ammunition. Learn fun hobbies that are useful if tshtf.
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Old 06-05-2017, 06:27 PM   #25
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Yes, good point. If a large portion is in fixed income that would bring down the overall return.

But the comment about "He's buying and selling all sorts of stuff. I get trade confirmations more often than statements" is typically what we see when companies like Merrill Lynch, Edward Jones, or Ameriprise get involved with managing an account and generate excessive fees for themselves by constantly trading stocks.

It may all be fine, but it would be a huge warning sign if someone brought it to me to look at. I know of no good strategy that involves buying and selling all sorts of stuff. And if it's the advisor doing it, that is highly suspicious.

. . . but nobody brought it to you to look at, or did they?

If the poster is satisfied with what he is doing, isn't that what matters -- to him?

I don't see him criticizing what you do.

. . . and we see lots of comments comparing the S&P 500 to a balanced portfolio. There is very little objectivity or validity in such comparisons, but it is what happens here so very often. It is just a poor attempt to show the poster that what he is doing is wrong, but it is his assets, his portfolio, his life.
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Old 06-05-2017, 06:37 PM   #26
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... I was a little nervous at first with all the activity but I don't pay trade fees and I'm making lotsa dough. ...
The question is: Are you making (net after ALL fees) more than the market average? Total return on the broad market Russell 3000 index was 12.74% last year. (Russell Index Performance Calculator | FTSE Russell) The total return of S&P 500 was 12.25%. (https://dqydj.com/2016-sp-500-return/)

Statistically speaking, what your FA is doing is a recipe for failure over the long term even if he is beating the market net of fees right now.
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Old 06-05-2017, 06:45 PM   #27
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... It is just a poor attempt to show the poster that what he is doing is wrong, but it is his assets, his portfolio, his life.
@Rustward, I didn't see your post before I made mine, but it is my impression that one of the reasons people come here is to learn. I would not use the word "wrong," rather the word "non-optimum."

There are plenty of investors who are being gulled by the hucksters at places like Merrill, Morgan-Stanley, etc. Hopefully @RobbieB is not one of them, but from what he said he may be. Hopefully comments he sees here will at least make him wary and at best save him a lot of money.
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Old 06-05-2017, 06:47 PM   #28
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. . . but nobody brought it to you to look at, or did they?

If the poster is satisfied with what he he doing, isn't that what matters -- to him?

I don't see him criticizing what you do.

. . . and we see lots of comments comparing the S&P 500 to a balanced portfolio. There is very little objectivity or validity in such comparisons, but it is what happens here so very often. It is just a poor attempt to show the poster that what he is doing is wrong, but it is his assets, his portfolio, his life.
So true. I never understood why the S&P500 had to be the benchmark for comparison. Always and everywhere there are other ways to invest and other things to invest in that could have made more money. If you have a balanced portfolio you will beat the S&P on the way. And be holding the bag for missed profits on the way up. And using a 100% S&P AA is fine too. I guess....? My personal benchmark is "Do I have enough money?"

Personally I couldn't do what robbie is doing. ie Take a lifetime of money and give it to somebody else and, "See ya later" But if he can, hey, it's his bread and I'm sure he's meeting his benchmark 'cause he has enough money.

As far as what I do in good times to prepare for the bad times: I try not to spend too much
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Old 06-05-2017, 06:59 PM   #29
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Yes, I get from Robbie's responses that he doesn't want to change what he is doing. But these forums serve as learning tools for everyone who comes here to read them, and perhaps someone will read this thread and learn something from the exchange of conversations.

I have no intent to try and change the behavior of someone who does not see the need nor desire to change what they are doing.
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Old 06-05-2017, 07:12 PM   #30
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During the "good times" I look at what the impact of losing 25% of my savings/investments would be. If I can live with that I do nothing but maintain my AA, currently at 44% equities.

I also maintain enough in cash so that I can use that for my target SWR without being forced to sell investments for 5-7 years (by which time we will be eligible for SS). Perhaps overly conservative, but that lets me sleep at night.
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Old 06-05-2017, 07:59 PM   #31
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Don't worry about me I'm used to it. Ever since I've been here "helpful" people have been trying their very best to "correct" my errant investment practices.

FA at % of AUM at a full service broker?

Yeah, works for me -
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Old 06-05-2017, 08:38 PM   #32
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W2R if I recall correctly you are approaching age 70. You will lose your spousal ss at 70 (from being married 10 years). Will your RMD's cover that loss in income? Not meaning to pry, just curious if you have considered. I remember you were surprised to discover you qualified for the additional ss.
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Old 06-05-2017, 08:47 PM   #33
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W2R if I recall correctly you are approaching age 70. You will lose your spousal ss at 70 (from being married 10 years). Will your RMD's cover that loss in income? Not meaning to pry, just curious if you have considered. I remember you were surprised to discover you qualified for the additional ss.
You have a great memory! Or maybe you were the person who told me about divorced spousal SS. I cannot for the life of me remember the person here who told me, but I am eternally grateful to whoever-it-was.

I will be switching over to my own SS, which is supposed to be growing all this time. If everything works out as I expect, then my SS deposits will be bigger by about $500/month starting a year from this month. So this, plus my RMDs, is an example of "The Tax Bomb" that some seniors experience at age 70.

I have been spending a little more money from my TSP (=401K) than I might have otherwise, since that money is taxable as ordinary income. At 70, I can lean a little more on my taxable accounts and less on my TSP. Hopefully that will soften the blow. But I will probably pay more taxes anyway.
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Old 06-05-2017, 08:51 PM   #34
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Gathering nuts and storing them away.

Keep trying to reduce my equity exposure; not reinvesting dividends or cap gains distributions, more aggressively writing calls letting some shares get called. Have very little equity not subject to cap gain tax in taxable account. Have a couple balanced funds in tax sheltered, will take another look at those balanced funds to see if I can reduce further.
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Old 06-05-2017, 09:14 PM   #35
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Don't worry about me I'm used to it. Ever since I've been here "helpful" people have been trying their very best to "correct" my errant investment practices.

FA at % of AUM at a full service broker?

Yeah, works for me -


You seem to have a pretty great lifestyle so something must be working well. May be a different path than some others would choose but hey - bidets and filets - sounds like you're enjoying your life and your asset performance is meeting your needs. Well done!
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Old 06-05-2017, 09:20 PM   #36
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What tactical moves are others doing as their money grows in these good times?

As an example, here is what I've done:
A) Continued to stick with my current AA
B) In the fixed income part I moved some intermediate bond money to a short term investment grade bond fund. This should see us through the worst of the bad sequence years (like those starting in 1966, 1929, and 1906).

Regard (B), this is enough to cover:
(1) a Reserve account to boost normal portfolio spending should we have a very bad sequence of returns going forward
(2) the next 12 months of spending

So I think I've insured that even in a very bad sequence of return years we should be able to spend at levels that will please even DW. Now I can relax ... I think .
When the market is happy and my portfolio is growing, my income is rising faster than my spending. So (as you already know) I let the unspent income pile up in short-term, safe investments separate from my retirement portfolio (where I maintain an AA). They are thus protected from a sharp market selloff and available to pad future income if needed. Over the past few happy years these short-term funds have grown quite a lot. I'm going to keep letting them build while the crazy party continues. You know my outlook is pessimistic.
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Old 06-05-2017, 09:22 PM   #37
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Sticking to my 60/35/5 AA, but rebalancing more frequently to lock in market gains. Sticking with CDs and 2020 target maturity bond funds to mitigate interest rate risk. Otherwise, very boring.
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Old 06-05-2017, 10:03 PM   #38
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i wont do anything, i didnt retire that close to the edge, i have a cushion. i guess we could tighten our belts and spend less . But even if another 1929 comes or a 2007 im good. ill just have less. I withdraw zero now, so zero of a smaller pie is still zero. my tactical move is to let it accumulate.
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Old 06-05-2017, 11:45 PM   #39
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You seem to have a pretty great lifestyle so something must be working well. May be a different path than some others would choose but hey - bidets and filets - sounds like you're enjoying your life and your asset performance is meeting your needs. Well done!
I think this is well worth repeating. Way to go Robbie, and thanks for the post, Scuba.


We will all end up dead, and as long as we enjoyed the journey that is what really matters.
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Old 06-06-2017, 12:04 AM   #40
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Stockpile food and ammunition. Learn fun hobbies that are useful if tshtf.
I don't have any ammo, but I have stockpiles of staples and lots of sustainable living hobby projects on my to do list like solar projects, micro-greens and herb gardening that also help to lower our overhead.
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