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Thank you Zotty. All great points.

Sorry, edit made.

My overall AA goal is 65/35. In line with that I currently have 100% of my 401k invested in bond funds. I would like to convert most of this to CDs to mitigate interest rate risk. Since CDs are not an option for the 401K, I would need to change bond funds to stock funds in the 401K and buy the CDs i...

Thank you Auntjovie.

I would like to calculate the PV of my SS and pension for use in determining asset allocation. My pension is a fixed annuity. What cap rate is typically used (e.g 7%)? Should I use different rates for SS and pension? I am not looking for anything too complex, so, I am willing to live with ball park ...

My two cents: age in bonds seems to make sense once you hit 65, so, for example by age 80 you have 20 in stocks to help with inflation while protecting against huge hit to the portfolio. Until age 65, allocations of 70/30 to 80/20 may make sense depending on many factors such as objectives and risk ...

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Staythecourse, thank you.

I would like to earn about inflation plus two percent over the long term.

I've always thought the age in bonds was rather simplified for the masses. My advice for those who want to be aggressive: 80/20 from the beginning until 10 years before you need the money. Every rolling 10 yr. period in history with a 80/20 was positive in nominal terms (the way folks look at their...

Nisiprius,

What if you invest in TBM (5 year duration) today and rates increase one percent per year for the next five years before they level off? You will be under water for 7 to 8 years, right?

Keep this in mind, the yield curve already incorporates the market's expectation for rising rates. So rates have to rise MORE THAN by what is already built into the curve for you to be better off staying short. Here is simple example. Say 1 year rates are 1% and 2 year rates are 2% and you think ra...

Brian[/quote] Yes it will do a number. Do you know what the number is? TBM has a duration of 5 years. That means if rates go up 1% this year, you lose 5% of principal. Given the yield of 2%, that means you'll have a loss of 3% for the year. Then, your fund begins earning 3% instead of 2%. Within 3 y...

I will take all of your help and crunch the numbers and get back to you. Thanks all.
Jim

My SSA benefit:
Age 66 - $2,459
Age 70 - $3,369

Wife SSA benefit:
Age 62 - $995
Age 66 - $1,408
Age 70 - $1,967

My wife also has an earnings record. My record is greater than hers and her full retirement annuity amount is less than half of mine.

At 66, I plan to file and suspend and begin to take my benefit at age 70. My wife will be 62 when I am 66. At age 62, it appears that she can take a spouse benefit - half of my full benefit (at full retirement age of 66) - that is reduced about 35%. I believe she is locked into this reduced benefit ...

At 66, I plan to file and suspend and begin to take my benefit at age 70. My wife will be 62 when I am 66. At age 62, it appears that she can take a spouse benefit - half of my full benefit (at full retirement age of 66) - that is reduced about 35%. I believe she is locked into this reduced benefit ...

Assume I have $100,000 that I will be needing in about 14 years and it will not be included in my stock allocation. Does it make sense to invest it in a long term bond fund such as VG LT Investment Grade and then shift it to an intermediate fund such as VG Intermediate Term Bond Index after the 8th ...

I think you have to adjust your thinking about depending on bonds, including TIPS and any Treasuries, as being less risky than stocks going forward. At some point, the US will require a bailout to avert default (next 10 to 20 years?).

I like the idea of a 20/80 allocation at time of retirement. Right now I am 20/80 in TSM / money market and about to retire. But, I just can't persuade myself to reallocate the 80% money market into a bond fund such as TBM at this time, even if it were to be a very long-term investment. Bond prices ...

Kevin - thank you. How does the one-time rate increase work? What are the limits on when you can exercise it and what would be the maximum increase?

I found this quote on bogleheads wiki: "The duration is the length of time that an investor needs to hold the fund for the increased yields to compensate for the decrease in NAV. In that sense, duration represents the length of time it would take for the total value of the fund, with dividends ...

I am allocated 20% stock and 80% money markets. My wife and I are 62 and 65. The plan is to get to 60-30-10% (stock fund, bond fund, cash) allocation gradually by making purchases when prices are not inflated excessively (i.e. intend to increase stock position during market corrections and bond posi...