64 yrs old should I get into the stock market

Have a question about your personal investments? No matter how simple or complex, you can ask it here.
Post Reply
boglecat2018
Posts: 3
Joined: Thu Jul 26, 2018 9:03 pm

64 yrs old should I get into the stock market

Post by boglecat2018 » Sat Jul 28, 2018 12:18 pm

Hello everyone, new to the site but have really enjoyed learning from all of your experience. In a nutshell, I’m 64, plan to work until I’m 69 or 70, claim SS at 70, moderate income but we live comfortably without spending a lot (wife is frugal in a good way). My wife is 60, disabled and does not work at present, there’s a possibility she could work, at least P-T in the future(?), Portfolio is high six-figures. Cautious about investments and stock market makes us nervous: will we have time to ride any ups and downs; we really don’t want to lose money. All savings are in 401k, money market and CDs right now. We would like a little more income. I’m new to my current job which crushes what the 401k could have been, but there are so many benefits, both now and after retirement, that’s it a good place to be. For example, I’m the last group eligible for the company pension plan, small as the amount may turn out to be.
Emergency Fund: more than 8 months in savings/money market
Debt $8k medical at 0% interest, will be paid in full in 6-8 months, no house, no children, no other obligations (we do think about buying a condo in a senior subsidized complex after retirement)
Married filing jointly Tax rate: Fed 22-24% State 9% California (yes, ouch, it’s expensive here and getting worse)
No stock market investments yet (other than 401k), my well-to-do father never trusted the market, said it is legalized gambling, but we’re considering a certain amount invested at 40/60 stocks & bonds with Vanguard (we like the low expense funds like Wellesley, LifeStrategy Moderate Growth, FTSE Social Index Fund, Total Int’l Stock Index, VG Intermediate Term Treasuries, and what do you think of their gold shares fund)
Cash (CDs, money market) 57.18%
All retirement accounts with banks except the 401k:
my 401k 2.7% (now contributing maximum of 24k every year with 6% company match) distributed as follows:
Retirement Allocation Fund 10.04%
Target Date 2025 Fund 10.07%
Money Market Fund 9.98%
Bond Fund 9.96%
US Stock Index Fund 10.24%
EIX Stock Fund 49.71% = 100% (EXPENSE RATIOS TO FOLLOW)
-----
my IRA 19%
my ROTH 2.56%
wife IRA 16.% contribute max each year
wife ROTH $8K 2.56%
Grand Total 100%

1. How much, if any, should we put into the market? I like Vanguard funds, several people we know have had very good long-term results with VG. Any other suggestions.
2. What about a fixed annuity? Wife worked in the insurance field and knows there are some good companies and products out there (any experience with immediateannuities.com?). How much $ would you put in an annuity. One guy told me 5-6% are possible right now.
3. Do people in our bracket use a financial planner? We know someone we think we can trust--but feel we could do these investments ourselves, without paying for advice on such a simple portfolio. We’ve gone over Jane Bryant Quinn’s new book several times and spend a good amount of free time reading financial articles.
Any suggestions and ideas you have will be more than welcome, i.e. if you were me, what would be your plan of action. Many thanks, Jerry

DJN
Posts: 128
Joined: Mon Nov 20, 2017 12:30 am

Re: 64 yrs old should I get into the stock market

Post by DJN » Sat Jul 28, 2018 12:38 pm

Hi boglecat2018,
I am in a similar position in terms of age. My main concerns have been:
- what are my expenses
- have I enough, and
- how can I preserve my money.
When you feel you have enough then the last thing you want to do is to end up by doing something that means you don't have enough.
The only other thing I would say is that I would strongly advocate not doing anything that you don't really understand. If you want to proceed with investing further then use the Bogleheads resources and check out the right thing to do.
good luck,
DJN

jalbert
Posts: 3694
Joined: Fri Apr 10, 2015 12:29 am

Re: 64 yrs old should I get into the stock market

Post by jalbert » Sat Jul 28, 2018 1:28 pm

and what do you think of their gold shares fund)
Let's dispense with this first. This fund is much riskier than a diversified stock index fund.

In your interest in having a portfolio that is very low risk, you have minimized investment risk, but are taking substantial inflation risk. If you want a portfolio that is exclusively fixed income, you may want to consider individual TIPS. If you search this site for "TIPS ladder" you will find lots of info.

You may want to consider a technique called income flooring. This involves covering your best estimate of required retirement expenses (that are not covered by SS or a pension) with a stable, safe, income stream. Then any remaining assets may be invested more aggressively with minimal risk of not being able to meet your expenses.

TIPS ladders and immediate annuities (SPIAs) are the tools for building an income floor. Any remaining assets could be invested in LifeStrategy Moderate Growth to cover discretionary expenses or shortfalls in your best estimate of required expenses.
Last edited by jalbert on Sat Jul 28, 2018 1:37 pm, edited 1 time in total.
Risk is not a guarantor of return.

tibbitts
Posts: 8006
Joined: Tue Feb 27, 2007 6:50 pm

Re: 64 yrs old should I get into the stock market

Post by tibbitts » Sat Jul 28, 2018 1:32 pm

and what do you think of their gold shares fund
Name of the fund, please. We need to know so everyone can pile on and say it's a horrible investment - it's less fun to bash a nameless fund.

jalbert
Posts: 3694
Joined: Fri Apr 10, 2015 12:29 am

Re: 64 yrs old should I get into the stock market

Post by jalbert » Sat Jul 28, 2018 1:39 pm

Does vanguard have a fund with exposure to gold other than VGPMX?
Risk is not a guarantor of return.

boglecat2018
Posts: 3
Joined: Thu Jul 26, 2018 9:03 pm

Re: 64 yrs old should I get into the stock market

Post by boglecat2018 » Sun Jul 29, 2018 1:27 pm

Thanks, everyone. The gold idea came from someone else: VG SPDR Gold Shares.
No one gave an opinion on should I even be in the market? Would like to hear about that.
I think I will start out conservatively with the LifeStrategy Fund, appreciate your time.

User avatar
Sandtrap
Posts: 5324
Joined: Sat Nov 26, 2016 6:32 pm
Location: Hawaii😀 Northern AZ.😳 Retired.

Re: 64 yrs old should I get into the stock market

Post by Sandtrap » Sun Jul 29, 2018 2:09 pm

If possible, can you edit your original post in this format (use the pencil icon)???

Asking Portfolio Questions
https://www.bogleheads.org/forum/viewt ... =1&t=6212

You will get more comprehensive help in this easy to read format.

j

mouses
Posts: 3732
Joined: Sat Oct 24, 2015 12:24 am

Re: 64 yrs old should I get into the stock market

Post by mouses » Sun Jul 29, 2018 2:17 pm

What is the situation in terms of pension amount, Social Security for both you and your wife vs. expected expenses in retirement? Also, how does that change when one of you passes away?

sksbog
Posts: 208
Joined: Wed Jun 20, 2012 9:14 pm

Re: 64 yrs old should I get into the stock market

Post by sksbog » Sun Jul 29, 2018 2:43 pm

Absolutely! Just make sure your bonds -stock ratio is age appropriate.

FBN2014
Posts: 444
Joined: Sat Mar 08, 2014 3:07 pm

Re: 64 yrs old should I get into the stock market

Post by FBN2014 » Sun Jul 29, 2018 3:02 pm

I would use a 40/60 or 30/70 equities to bonds asset allocation using a 3 or 4 fund portfolio. Even in a 2008 type crash your max drawdown would be around 15% which you can probably weather.
"October is one of the peculiarly dangerous months to speculate in stocks. The others are July, January, September, April, November, May March, June, December, August and February." - M. Twain

delamer
Posts: 6138
Joined: Tue Feb 08, 2011 6:13 pm

Re: 64 yrs old should I get into the stock market

Post by delamer » Sun Jul 29, 2018 3:55 pm

If your Social Security and your pension will cover your basic expenses in retirement, then there is no need to take the risk of investing in stocks if they make you uncomfortable.

So people haven’t commented on whether you should be invested in stocks because isn’t a decision that should be made without more information.

Figure out how much you need to cover expenses and how that compares to your pension and SS, and post that. Then you’ll get better suggestions.

Investing in stocks involves the risk of losing principal in the short term, but provides better long-term returns.

Most people on this forum accept that risk/return, but you might not have to.

I am your age and have 70% of retirement funds in stocks.

boglecat2018
Posts: 3
Joined: Thu Jul 26, 2018 9:03 pm

Re: 64 yrs old should I get into the stock market

Post by boglecat2018 » Tue Aug 14, 2018 9:40 pm

Thanks, everyone, what you've suggested is helpful and I'll keep on researching this,
and may post what action(s) we eventually take.

User avatar
BL
Posts: 8278
Joined: Sun Mar 01, 2009 2:28 pm

Re: 64 yrs old should I get into the stock market

Post by BL » Tue Aug 14, 2018 10:33 pm

I like the Quinn books, also suggest you look at the Boglehead's investing and also retirement guides, available at Amazon or at your public library. There is also a new 3-fund portfolio book by Taylor who has a long thread here.

You might like government I-Bonds to help keep up with inflation but never lose money. 10k/year, tied up 1 year, 3-mo. interest penalty up to 5 years, follows CPI and may change interest rate every 6 months.
https://treasurydirect.gov/

SPIAs have a guarantee from insurance company. Rate you get is both interest and return of capital so can't be compared to interest rate. They don't keep up with inflation. Permanent loss of your "investment" capital.

Post Reply