stephenson
Thinks s/he gets paid by the post
- Joined
- Jul 3, 2009
- Messages
- 1,614
Hi All,
Well, I finally got cold feet wrt the equity market and C19.
Background - married, 66, good health, income from military retirement, corporate retirement, non qual plan, couple of rental houses (paid for), MMFs and CDs, waiting on SS. IRA totals about same as taxable accounts. Debt about 50% of current house value (can pay off anytime, but good loan rate).
1. Non-Taxable - was about 90% equities in IRAs. Sold out last week - reduced equities by 50-70%. AA (Equity/Bond/Cash equivalent) now around: 40/20/40. About 14% Roth. Around 80% US and 20% international equities. Short-mid term bond funds, not individual bonds. Numbers are ROMs.
2. Taxable - way out of AA whack as there are pretty significant capital gains to pay - and, haven’t needed, so haven’t sold. AA is now around: 75/3/22. I did buy some equity ETF and individual stocks during the C19 crash (wish I had more), but did want to keep enough living expenses (and mad money) for 5 years or so.
3. NQP - was about 80% equities. Sold out of about 2/3 of equities. AA is now around: 13/0/87. Payout is quarterly.
So, what I did was to play to my concerns about the next year or two. I believe a vaccine will be available and this will alleviate the fear of C19, but there will continue to be financial fallout, and given the current nuttiness (my assessment) in US politics there is likely to be some significant turmoil. I think there will be a situation like occurred in the first few years of the first Obama administration where a lot of people worked really hard to fix things that had been broken. But, clearly all simply me predicting and placing my bets. And, I needed to reallocate, anyway
Given the above, what I would like to do is:
1. Non-Taxable - increase the bond component by pulling from cash, while maintaining the equity component.
2. Taxable - review funds to determine which ones I have paid the highest percentages of NAV increase in dividends already, and which ones have the highest ER, to develop a list of targets to sell out of, converting initially to cash and then placing in bonds/bond funds.
3. NQP - probably hold as is since this is subject to quarterly payments that I use for current income.
Frankly, I need help on the bond component - have never spent much time thinking about bonds and bond funds. I know I can buy individual bonds, but never have - bond funds way easier, obviously. Bond mutual funds or Bond ETFs? Given my relatively high risk tolerance, which would make more sense?
Would appreciate your thoughts.
Well, I finally got cold feet wrt the equity market and C19.
Background - married, 66, good health, income from military retirement, corporate retirement, non qual plan, couple of rental houses (paid for), MMFs and CDs, waiting on SS. IRA totals about same as taxable accounts. Debt about 50% of current house value (can pay off anytime, but good loan rate).
1. Non-Taxable - was about 90% equities in IRAs. Sold out last week - reduced equities by 50-70%. AA (Equity/Bond/Cash equivalent) now around: 40/20/40. About 14% Roth. Around 80% US and 20% international equities. Short-mid term bond funds, not individual bonds. Numbers are ROMs.
2. Taxable - way out of AA whack as there are pretty significant capital gains to pay - and, haven’t needed, so haven’t sold. AA is now around: 75/3/22. I did buy some equity ETF and individual stocks during the C19 crash (wish I had more), but did want to keep enough living expenses (and mad money) for 5 years or so.
3. NQP - was about 80% equities. Sold out of about 2/3 of equities. AA is now around: 13/0/87. Payout is quarterly.
So, what I did was to play to my concerns about the next year or two. I believe a vaccine will be available and this will alleviate the fear of C19, but there will continue to be financial fallout, and given the current nuttiness (my assessment) in US politics there is likely to be some significant turmoil. I think there will be a situation like occurred in the first few years of the first Obama administration where a lot of people worked really hard to fix things that had been broken. But, clearly all simply me predicting and placing my bets. And, I needed to reallocate, anyway
Given the above, what I would like to do is:
1. Non-Taxable - increase the bond component by pulling from cash, while maintaining the equity component.
2. Taxable - review funds to determine which ones I have paid the highest percentages of NAV increase in dividends already, and which ones have the highest ER, to develop a list of targets to sell out of, converting initially to cash and then placing in bonds/bond funds.
3. NQP - probably hold as is since this is subject to quarterly payments that I use for current income.
Frankly, I need help on the bond component - have never spent much time thinking about bonds and bond funds. I know I can buy individual bonds, but never have - bond funds way easier, obviously. Bond mutual funds or Bond ETFs? Given my relatively high risk tolerance, which would make more sense?
Would appreciate your thoughts.