cyclinggirl wrote:Need help getting back in the market after selling everything 12-31-2010. At that time I was almost even from the crash of 2006.
But having my money in money market is ridicules so I'm finally going to do something. Here's where I stand.
I'm 55 and not working, with no prospect to start. Partner has agreed to cover most bills until I can take funds from my retirement accounts which I plan on doing at 59 1/2.
In my Vanguard IRA account I have the following:
$590,000 in cash
$7,000 in IYW, an ETF of Tech Companies
$5,000 in EMC (purchased in 2000,when it doubled I sold 1/2)
In Vanguard single account
$60,000 in cash
Bank account, single
Morgan Stanley IRA (previous employer)
$40,000 in cash
$20,000 in General Mtrs Bonds paying 7.5%
$40,000 VTA - A closed end bond fund, fixed income senior floating rate paying 7.2%
Morgan Stanley single
I have a rental home where the rent covers the mortgage, but not taxes and insurance - loss of $6,000 a year. Currently on the market with good prospect to sell with a profit of approx. $50,000 (nothing is for certain).
Any suggestions would be greatly appreciated.
First of all, you didn't miss anything being out of stocks during 2011. However, in 2012 stocks have done pretty well. I think the S&P500 is up about 14% this year. But who is 100% stocks? Balanced Index, which is 60/40 is up about 10.45% and 35/65 Wellesley Income is up 9.74%. So maybe you missed out on about 10 percent gain since you've been on the sidelines. But that's all water under the bridge.
The first thing to do is to come up with realistic goals
. Here is an example:Goal:
Starting on January 15, 2018, withdraw inflation-adjusted $X per month, continuing for N years without depleting principle.
Or it could allow for spending down principle, if you don't care about leaving a legacy. Once you have goals, then you can start to think about what portfolio characteristics would be necessary to meet those goals.
Are the goals so lofty that a high return is required? Then you might have to lean towards a high-risk/high-return portfolio.
Or can the goals be achieved with low-return/low-risk? If your goals are modest, maybe they can be met with 5-Year CDs.
Or somewhere in the middle.
You will never achieve your goals, if you don't know what they are.
Тише едешь, дальше будешь. (Quieter you-go, further you-will-be.)