Also early 60's and retired a couple of years ago. We decided to make sure that we had inflation indexed income that would cover what I call the basics of life. And we did that by taking all of the bond funds we previously had and purchasing a few TIPS ladders. Each of us have 30 year ladders and I have another small ladder that acts like a bridge to SS that I will start when I turn 70 in a few years. My wife is less than a year away from starting SS, so we opted not to use TIPS as a bridge. Some say this is what you do when you've "won the game", but since I don't make investment decisions based on clever phrases, I won't say that. Oops, I just said that./So my spouse and I are both retired now, early 60s. We have decent inflation-indexed pensions, which with Social Security will provide us with a good foundation for covering essential bills and even some extras. But we have also been fairly good savers who have accumulated more than $3.6 million in financial assets in addition to a paid-off house. Over the long-haul Social Security and pensions will provide about $150k/yr, leaving $70-$80k/yr for the portfolio to support. (That budget would provide for a very comfortable lifestyle, with plenty of retirement fun and generous gifting.)
Until quite recently we floated between 75:25 and 80:20 equity/fixed income. That has worked pretty well for us. But to prepare to consolidate some accounts, the investments in one account (our largest) have been liquidated to be consolidated with another provider, to simplify things. That has left us temporarily at 33:67 equity/fixed income.
(Note: the equity side of things has long been about 20% total international and 80% total U.S. stock.)
I feel like we are a bit at a cross-roads, because we both are at the point of maximum sequence of returns risk and at a natural point to rethink portfolio allocation. I am leaning towards basically funding the almost ten year period to 70 (when my Social Security will kick in; the spouse’s will start earlier) with super-safe assets, and just let the more risk-oriented part of the portfolio ride during that time, perhaps even with the same 75:25 allocation we have now. I would be curious to hear how others have approached this.
The only additional information is that there will likely be some inheritances, but they will probably only be on the order of about 10% of our current financial assets at most, and they could be zero. (I would be delighted if our parents just enjoyed all of their money.)
Thanks for any thoughts you have, or experiences to share.
Ultimately our TIPS + SS Bridge/Actual SS plus dividends from the stock fund in our taxable account funds all of our usual expenses and then some, including baseline taxes. The rest is all stocks and we use that for any sort of lumpy spending including: fun stuff, new cars, new roof, unexpected expensive maintenance, and paying tax on Roth conversions.
We also have a couple of other things set aside
- We purchased I-bonds over a 10 year period and plan on holding till they mature, which starts in our mid 80's. If we're still alive and kicking, we'll consider perhaps purchasing a SPIA with that
- We also have a chunk set aside in an ultrashort bond fund for home improvement projects.
The kiddo basically gets whatever we haven't spent yet.
Cheers.
Statistics: Posted by dcabler — Tue Apr 15, 2025 6:21 am — Replies 14 — Views 1620