Non-investing personal finance issues including insurance, credit, real estate, taxes, employment and legal issues such as trusts and wills
I have recently entered "retirement". Having been fortunate to have carefully contributed and managed a now conservative portofolio over many years (25%equities/65% various bond fund holdings/municipal and corporates/10% cash), and having adaquete assets based on spending needs, I also have a five year income stream coming to me as a result of a company I was a founding member. The after tax portfolio is throwing off enough even in this low return environment to cover our expenses. For the past several years, all returns have been re-invested. My question is; Should we live off of the income stream from the five year ramp of payments I am due from a former company and keep re-investing the monthly returns off of the portfolio, or, invest the income stream in our asset allocation, and begin living off of the monthly portfolio interest and dividends? Not sure it makes a difference one way or another but interested if anyone has an opinion on this. The combined portfolio, (tax advantaged and after tax has been growing typically 6% year over the past 10 years). I would not be drawing down any of the tax advantaged at this point, just the after tax portfolio.
- Posts: 4
- Joined: 29 Jan 2013
If I understand you correctly, there is no difference between the two secnarios you describe. Money has no memory and doesn't know where it came from.
Philly Chapter Coordinator
- Posts: 2077
- Joined: 5 Jan 2010
- Location: Philadelphia PA
can you shelter any of the 5-year income? If so, maybe spend the "after tax" income (whatever that is) and invest the five-year income.
If there are no tax-sheltering options then I agree it makes no difference.
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