Where can I find sample portfolios on this site? That would really help me. Thanks!
Goldenmom,
What I'd recommend:
1) Don't be in a rush to do anything. Take your time to do some self-education and it will pay BIG dividends in helping you to stay on track in the future--when the markets get crazy, when a friend offers you a chance to invest with their "really good" advisor, when you hear a new hot new investing concept on the radio. Unless you need to move your money immediately for some reason, take a month or so to read a book or two and spend some time at some good web sites.
2) Resources: The FAQs here have some books that are widely recommended here. They are solid, easy to understand, and have concrete examples of portfolios. My personal recommendations would be The Bogleheads Guide to Investing and The Four Pillars of Investing (William Bernstein). I also like "The Coffeehouse Investor" and most books by Larry Swedrow. You can also learn a lot online--my three favorites are this board, Bogleheads, and the Vanguard website.
3) Then set up your desired asset allocation and the portfolio of assets needed to achieve it. That sounds very "formal" and difficult, but it can be done easily and quickly--too easily, really: Many folks jump in and buy a bunch of different things without taking the time to do steps 1 and 2 above, and they are easily swayed to change their investing style later (usually at great expense in taxes or "selling low, buying high) because they didn't have a good philosophical "mooring" for the things they bought in the first place,they You'll find good model portfolios in the books above, and some have been recommended in this thread (the Bogleheads "Three Fund Portfolio" is one).
4) Nit-noids:
a) If you get totally swamped by this whole thing, or it's something you don't want to take on, you could just put all your retirement savings into the Vanguard Target Date Retirement fund of your choice (e.g. Target Date 2020, Target Date 2035, etc). Don't get hung up on the year listed in the fund name, each is just a portfolio of other mutual funds with a mix of stocks and bonds. Over time, each will get more "conservative", investing less and less in stocks and more in bonds. The portfolios are well diversified and rebalanced automatically. By going with one of these Target Date funds (compared to setting up your own portfolio) you'll give up some tax efficiency and the ability to fine-tune assets, 1) that's often not a bad thing and 2) you'll still get investment results far better than most other investors who fiddle around their portfolios more actively. I think doing your reading and setting up your own portfolio is the better long-term solution, but using one of these Target Date funds is a good fallback position and far better than falling into the clutches of an expensive "percent of assets under management" Financial Advisor/CFP who will put you into high-expense funds.
b) Living off dividends and leaving the principal untouched (as mentioned in your earlier post): This is a valid approach and many investors use it. But it's not as simple or inherently "good" as it sounds. Keep an open mind as you do your reading, many people find that the "total returns" approach makes more sense to them. Stock share prices generally go up in value faster than inflation--in a widely diversified basket of stocks, this real (above inflation) gain in stock prices is often more than the dividends returned by the stocks. If you never sell any then you don't benefit from this--you just leave more money to your heirs at the expense of a better standard of living you might have had. Said another way, it usually takes a bigger starting "pot" to generate the income we need if we are just going to live off dividends and interest. Also, in some cases the mutual funds that concentrate on "high dividends" end up heavily concentrated in a few industries (utilities, banking, etc), and this can leave your portfolio dangerously overweighted in a few sectors, and that's not a "safe" thing.
Good luck!