Hello. I’m a bit of a lurker, and due to all the excellent input from the members of this forum, I have read some of the reading list, many ‘links’ to articles, and have become much more determined in my desire to look after my own finances.
I (and DW) have decided to become less reliant on the rat race, and are in the process of moving to a fulltime RV type of existence, which will include some part time / casual work. We have sold both of our properties. By September, our cash worth will be $950K (Aussie; slightly more in USD). This will literally be in cash. No other investment other than work pensions which total approx $150k and are not included in our calculations.
We want our first year of freedom to be reversible. So if we can’t do the travel thing we can access our capital and re-buy a property (possibly in the UK to make use of a good exchange rate / low prices.) So for the first 12 months or so, I am shy about putting the money into ETF’s / portfolio due to the short term issues of needing the capital back / market volatility.
So to the KISS bit. I covered this in my ‘Hi I am’ thread, but now its real, I’m getting nervy and would love some sort of 'reassurance' as to our plans. I can put the money in the bank for 12 months, fixed currently at 5.8%. I will keep $50k or so in an ‘unfixed’ account for expenses (currently paying 6.5% variable) which will allow for our spending plus contingency money. At 4% WR (which covers tax, medicare, and spending), I am only leaving approx 1.8% for inflation which I am prepared to do for one year.
At the end of year 1, I will have more money than when I started, and will re-look at ‘proper’ investments. The other option is to put the lot into a 5 yr fixed deposit (currently 7%). This doesn’t allow for the option of getting my cash back within 5 years, but at least its safe, and gives me a WR of 4% (assuming no work which is unlikely) with 3% inflation. All accounts are Govt guaranteed. I expect work will reduce our WR to nearer 3%.
It just feels wrong, at 43 and 47 yrs of age to be putting everything in cash. Am I going to missing out on the start of a world boom in the next 1-5 years? Hence am I being stupid?
I (and DW) have decided to become less reliant on the rat race, and are in the process of moving to a fulltime RV type of existence, which will include some part time / casual work. We have sold both of our properties. By September, our cash worth will be $950K (Aussie; slightly more in USD). This will literally be in cash. No other investment other than work pensions which total approx $150k and are not included in our calculations.
We want our first year of freedom to be reversible. So if we can’t do the travel thing we can access our capital and re-buy a property (possibly in the UK to make use of a good exchange rate / low prices.) So for the first 12 months or so, I am shy about putting the money into ETF’s / portfolio due to the short term issues of needing the capital back / market volatility.
So to the KISS bit. I covered this in my ‘Hi I am’ thread, but now its real, I’m getting nervy and would love some sort of 'reassurance' as to our plans. I can put the money in the bank for 12 months, fixed currently at 5.8%. I will keep $50k or so in an ‘unfixed’ account for expenses (currently paying 6.5% variable) which will allow for our spending plus contingency money. At 4% WR (which covers tax, medicare, and spending), I am only leaving approx 1.8% for inflation which I am prepared to do for one year.
At the end of year 1, I will have more money than when I started, and will re-look at ‘proper’ investments. The other option is to put the lot into a 5 yr fixed deposit (currently 7%). This doesn’t allow for the option of getting my cash back within 5 years, but at least its safe, and gives me a WR of 4% (assuming no work which is unlikely) with 3% inflation. All accounts are Govt guaranteed. I expect work will reduce our WR to nearer 3%.
It just feels wrong, at 43 and 47 yrs of age to be putting everything in cash. Am I going to missing out on the start of a world boom in the next 1-5 years? Hence am I being stupid?