Advice needed

[freedom2022]

Hi all,
I will receive a lump sum payment for my Defined Benefit Pension Plan, which will amount to half of my investment assets. I need to decide where to invest it. I aim for a 50/50 asset allocation. While I understand the wisdom of not attempting to time the market, the impact of near-zero interest rates is becoming increasingly apparent. This unprecedented monetary policy leaves us uncertain about its consequences, as history offers no guidance. Two years ago, the Fed claimed inflation was transitory, but now they suggest interest rates may decrease further, with no clear timeline. My intuition suggests interest rates will remain high for some time, indicating the market may be overvalued presently.

My options are as follows:

1. Place the money in a one-year GIC and make a decision next year.
2. Invest the money in a money market fund and make decisions as circumstances evolve.
3. Allocate some funds to stocks and the remainder to a money market fund or GIC.

Any thoughts?
Thanks.

 

[Lsbcal]

I think your best bet is to immediately go with your 50/50 allocation.

There will always be uncertainty in the markets and that is why prices get set second to second as people try to balance out the latest ideas and events.

 

[Gallaher]

I like what Lsbcal said. Another thought is to dollar cost average over a given time frame.
You could track over 20 years and let us know what was best…..if we’re still here.

 

[Jerry1]

I think your best bet is to immediately go with your 50/50 allocation.

If the OP was thinking of going with a high equity percentage, I’d go with dollar cost averaging. With 50/50, I’d set it up immediately and be done with it.

 

[Koolau]

I would suggest you set your asset allocation (review it if you have set one already) and then fund that AA right away with your new stash of cash.

 

[VanWinkle]

I like the idea of investing 25% in total stock fund and 75% in Money Market
(making 5.28%) and then investing 25% more in the stock market over the next 12 months. You get into the market now, and eliminate some short term worry by investing the rest over the next 12 months. I also like the 50/50 allocation.

VW