Long time lurker first time poster. Thank you to all who have contributed to my education here, absolutely invaluable.
I'm writing about my mother and father in law's finances, which I am slowly taking over at their request.
$425k in various super low interest checking / savings accounts
Investments at Fidelity (unlikely to change brokerages):
Rollover IRA: $675k of which
* 86.8% AAPL he's a lifelong Apple fanboy, bought $11,500 worth way back when, which is now $575k
* 5.5% FLPSX
* 5% FDRXX
* 1.4% FEQIX
* 0.8% FDIVX
Traditional IRA $23k
* 100% FDRXX
Fidelity Trust Under Agreement (?) $8k
* 100% FDRXX
Fidelity Charitable GIving Account $8k
* 100% Fidelity Investments Money Market Government Fund (basically cash)
So basically their allocation is APPLE + CASH. The big challenge is that he will NOT part with any of his Apple stock.
* No debt
* 3 properties, one of which is rental, worth $5-6 million total, all paid off.
* Married filing jointly, no dependents
* California residents
* age: he and wife both mid 80s, retired
* two children, married; two granddaughters, ages 4 and 8
* Insured to the gills - LTC Comprehensive, Umbrella, great UC system health insurance
Income / Expenses
average monthly income of $16k is Pension, SS, MRDs, rental income
average monthly expenses are about $13k
only take MRDs
so Risk Tolerance could be a bit higher than someone their age normally? given that they're not relying on the investments to live on? Granted 80% in one stock is about as risky as you can get!
Given that he absolutely won't part with any of the AAPL (he is justly proud of the incredible returns), it's really hard to apply Boglehead principles. Given that their income / expenses means that their risk tolerance can afford to be a bit higher, should I just look to move some of the FDRXX into something like FSITX?
I plan on suggesting the following:
- take $300k out of savings and front load 529 accounts for their granddaughters
- keep $75K in emergency fund at Ally,
- invest the remaining $50k in something conservative, given AAPL exposure. Maybe FINPX?