retirement accounts
I read and listen to you often, especially when it comes to retirement. I’m 72 in Feb, thinking seriously about retiring. Currently collecting 42k in SS, pensions around 53K. My 401k is allotted below:
Current allocation breakdown:
68.44% Stocks / 3.27% Real Estate / 28.29% Bonds and Cash
58% of the bonds are in government securities and the balance are in investment grade corporates.
45% of portfolio is US stocks (large, mid and small) and 23% is international (large and small and developed and emerging).
I’m thinking I should reverse the percentages between the stocks and the protected funds. Yes, I want to sleep at night. Your thoughts.
thx you
joe
Terry Says
There’s an old saying in the stock market: “Sell down to the sleeping point.” If it’s keeping you awake, you can certainly adjust the percentages. You might miss some upside, but sleep better.
BUT, I’m surprised that your money is still in your old 40l(k) plan. They are typically designed to have growth investments for younger workers. Very few have money market fund alternatives. Please read this article and consider doing a direct rollover to Fidelity or Vanguard, where you will have more conservative choices.
https://www.terrysavage.com/rollover-now/
This would be a good time to do that, before the year you turn 73 and have to start taking RMDs. It will be easier to have a stash of cash inside your IRA rollover account, which you can easily distribute on a quarterly or even monthly basis to fulfill your RMD requirement. Most 40l(k) plans aren’t happy to be bothered with this process.
