100 minus your age.... When did you start investing safer?

"Risk" by my reckoning is what happens when we do unusual or innovative things, pro or con. Putting 100% of one's portfolio into the S&P 500, and holding forever (that is, never trading and never withdrawing) may be gut-wrenchingly volatile, but has essentially zero risk. Barring an end-of-the-world scenario, the S&P 500 will recover from any bear market whatsoever, period. The only caveat is if the investor needs to withdraw money, say at the nadir of 1932.

Risk is what happens if I open a hotdog stand, or start an AI-tech company, or for that matter, buy a house. The house might be a lemon, or the neighborhood my decline, or there may be a catastrophe that's not covered by insurance... and my investment goes poof. That's risk! It's risky not because I'm against real estate, but because it's an episodic or idiosyncratic thing... one house, in one place, bought by one person, one at a time.

As for the theme of this thread, the key questions are (1) can the investor stomach volatility, and (2) does the investor need to withdraw the money anytime soon? If the answers are "yes" and "no", respectively, then a 100% equity allocation - to indices, not to individual stocks, of course - is fine.
 
"Risk" by my reckoning is what happens when we do unusual or innovative things, pro or con. Putting 100% of one's portfolio into the S&P 500, and holding forever (that is, never trading and never withdrawing) may be gut-wrenchingly volatile, but has essentially zero risk. Barring an end-of-the-world scenario, the S&P 500 will recover from any bear market whatsoever, period. The only caveat is if the investor needs to withdraw money, say at the nadir of 1932.

Risk is what happens if I open a hotdog stand, or start an AI-tech company, or for that matter, buy a house. The house might be a lemon, or the neighborhood my decline, or there may be a catastrophe that's not covered by insurance... and my investment goes poof. That's risk! It's risky not because I'm against real estate, but because it's an episodic or idiosyncratic thing... one house, in one place, bought by one person, one at a time.

As for the theme of this thread, the key questions are (1) can the investor stomach volatility, and (2) does the investor need to withdraw the money anytime soon? If the answers are "yes" and "no", respectively, then a 100% equity allocation - to indices, not to individual stocks, of course - is fine.
I tend to agree with Mr Diogenes.
I have more than enough retirement income coming in each month and invest the excess into various stock index funds: VOO for sure, but also VGT, MGK, QQQ.

My target AA is 95% stock funds, not 100%, because I am absolutely positive that we will see a correction at some point and I want some spare change to be available when that happens...
 
I started a few years ago when I turned 70 and my equities were spinning off a lot of dividends and RMDs started a couple years later. I took advantage of parking the cash in dividend producing MM MFs and CDs. The increase in taxes are more than taken care of by the MM and CD dividend/interest. The past few years have been growing a larger NW. I still have the same number of equities but the percentage of "dry powder" has increased.
 
As for the theme of this thread, the key questions are (1) can the investor stomach volatility, and (2) does the investor need to withdraw the money anytime soon? If the answers are "yes" and "no", respectively, then a 100% equity allocation - to indices, not to individual stocks, of course - is fine.

Absolutely!

When did you start investing safer? When volatility tolerance decreased and when money was needed 'soon' (generally accepted as <= 5 years).
 
Just day dreaming where I would be if I never owned any bonds, for that matter add in no foreign funds or small caps.

I do own some of all of the above.

Hint hint I think I can hear the ocean? Let me ask my butler.
 
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Zero bonds and minimal cash through age 55. Gradually increased to near 40% cash, CDs and bonds by age 60. Was able to allocate all of the Bond/CD to tax deferred accounts. As we approach SS starting at 70 we have let the cash/CD/Bond component drift down to 35% and may let it drift to between 30 and 35%
 
Just day dreaming where I would be if I never owned any bonds, for that matter add in no foreign funds or small caps.
Heh, heh, what's that old phrase? "Hindsight is 20:20." Unfortunately there are no do-overs in our financial lives.

If I could undo some of my investing mistakes, I'd be flying Netjets instead of flying "cattle-car" class. :cool: YMMV
 
Heh, heh, what's that old phrase? "Hindsight is 20:20." Unfortunately there are no do-overs in our financial lives.

If I could undo some of my investing mistakes, I'd be flying Netjets instead of flying "cattle-car" class. :cool: YMMV
Same here generically, but all is good in the end.
 
I have read this entire thread. Here is our situation: I walked out 12/07/2009. 15 YEARS ago @ 55 1/2. Now we are 70 1/2+. While w*rking - Sr. Financial Analyst for a Sacramento Utility District - I was VERY aggressive in my investments. Even withstood the fall 2008 debacle. [We went on a month long "pre-retirement" trip and were essentially incommunicado.] Lost 25% - but NO panic.
Since retiring I have gradually shifted to a 30/70 mix (equity/debt). We have solid income - CalPERS pensions + SS = $130k. ZERO debt - NO C/Card or mortgage. We typically run a budget surplus of $750 per month. Do NOT use retirement assets to support us.
So, WHY am I conservative now? Dunno - just feels right. As others have pointed out preservation of assets. I use the IRA to fund charitable givings. We paid cash for Molly's new BMW i4 electric car in June. We are at the point where we ONLY fly "business or better". As I said, it just feels right.

Thanks to ALL for sharing their stories and opinions.

"Wally"
 
We were 80-90% equities while working, in retirement we have drifted to 70/30.
 

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