Your 2025 Column
First of all I want to wish you a happy and healthy New Year. I want you to know that your guidance over the years has been helpful in so many ways and I feel blessed to have Terry Savage in my corner. That said, lets get down to business. More than 15 years ago, when I first retired you convinced me to open my first Fund account and I moved my 401 monies to TROWE Price. That account is currently 55/45 stocks to bonds. Since then I’ve worked and retired again and moved 401 monies and opened an account with Vanguard. This Fund currently sits at 70/30. My wife was a private school and was forced to retire in 2020 and I moved her 401 monies and opened an account with Fidelity. That account is 67/33 stocks to bonds. As you can probably guess we have had a pretty good 2 years. We have never taken any money out of these other than the RMD’s I’m required to take but I’ve reinvested those monies in Treasury Bills. I read in a book somewhere that greed is what destroys most investors portfolio and your column supports that theory. So right after the first of the year I moved about $60.000 out of stock funds and had the money moved to a sweep account. My questions are; should I be looking at moving more and get to a 50/50 ratio for all 3 accounts and is it wise to just let the money I move stay in the sweep accounts?
Terry Says
I wish I could give you the answer to that question — but we will only know in hindsight! Yes, you’ve had a great run. And yes, you’re older now — and counting on that money. And yes, you should get at least 4% interest in your “sweep” account. (If not move to a government-only money market fund.)
There’s an old stock market saying: “Sell down to the sleeping point!” If you have enough money in cash to pay for at least 5 years of RMDs (at current account valuations), you’re likely safe. But why take unnecessary risk with your gains. The very fact that you asked tells me you might want to move a bit more to cash.
