Asset allocation for those in their late fifties

Have a question about your personal investments? No matter how simple or complex, you can ask it here.
Post Reply
Topic Author
Mr.BB
Posts: 906
Joined: Sun May 08, 2016 10:10 am

Asset allocation for those in their late fifties

Post by Mr.BB » Wed Jun 12, 2019 7:34 am

I was curious if you are in your late 50s what is your current asset allocations to stocks and bonds.
Right now we 56% stock/ 36% bond/ The rest is cash (our emergency fund)
U.S stock 46%/ 10% Intl stock
36% bonds of which 6% are in Intl. bonds.
"We are what we repeatedly do. Excellence, then, is not an act, but a habit."

livesoft
Posts: 66363
Joined: Thu Mar 01, 2007 8:00 pm

Re: Asset allocation for those in their late fifties

Post by livesoft » Wed Jun 12, 2019 7:49 am

My asset allocation hasn't changed in years. Here it is (including when I was in my late 50's):
viewtopic.php?t=150267

Currently at 62% equities, so around my upper rebalancing trigger and exactly where it was when I posted that thread 5 years ago.
Wiki This signature message sponsored by sscritic: Learn to fish.

Silk McCue
Posts: 2401
Joined: Thu Feb 25, 2016 7:11 pm

Re: Asset allocation for those in their late fifties

Post by Silk McCue » Wed Jun 12, 2019 8:00 am

Mr.BB wrote:
Wed Jun 12, 2019 7:34 am
I was curious if you are in your late 50s what is your current asset allocations to stocks and bonds.
Right now we 56% stock/ 36% bond/ The rest is cash (our emergency fund)
U.S stock 46%/ 10% Intl stock
36% bonds of which 6% are in Intl. bonds.
58/60 - I am retired, wife will be retired at end of 2020.

As of this date 55% stock, 45% bond/CD(Achieva 5 year at 4.2%). Emergency fund not considered in allocation.

US to Intl Stock sits at 60/40.

77% Traditional 23% Roth. Plan is to reverse that ratio by age 70 leaving enough in Traditional to fully satisfy charitable giving with zero dollars ever taxed post age 70.5.

Plan is to let AA drift naturally to 70/30 to age 70 as equities left untouched while covering expenses with COLA'd pension and Traditional drawdowns while performing tax efficient Roth conversions of equities.

SS at ages 68/70 is the current plan.

Cheers

hear2share
Posts: 5
Joined: Mon Mar 18, 2019 2:02 pm

Re: Asset allocation for those in their late fifties

Post by hear2share » Wed Jun 12, 2019 8:06 am

Just turned 60 & newly retired.
90% equities/10% cash equivalents.
US/Int'l equities @ 80/20(5 of 20 in Emg).
Pension.

MikeG62
Posts: 1742
Joined: Tue Nov 15, 2016 3:20 pm
Location: New Jersey

Re: Asset allocation for those in their late fifties

Post by MikeG62 » Wed Jun 12, 2019 8:15 am

I am 56 and DW is 54. In our 4th year of retirement. Our actual asset allocation is 41% equities, 51% fixed income and the rest is cash. I view the cash largely as an addition to the short-end of our fixed income exposure (it's in accounts earning ~2.50%). Our US and foreign split on equities is 85% US and 15% foreign.

I'd add as well that we have no pension and are living off our financial assets. Don't plan to begin drawing SS until age 70.
Last edited by MikeG62 on Wed Jun 12, 2019 9:06 am, edited 1 time in total.
Real Knowledge Comes Only From Experience

User avatar
ruralavalon
Posts: 15688
Joined: Sat Feb 02, 2008 10:29 am
Location: Illinois

Re: Asset allocation for those in their late fifties

Post by ruralavalon » Wed Jun 12, 2019 8:23 am

Mr.BB wrote:
Wed Jun 12, 2019 7:34 am
I was curious if you are in your late 50s what is your current asset allocations to stocks and bonds.
Right now we 56% stock/ 36% bond/ The rest is cash (our emergency fund)
U.S stock 46%/ 10% Intl stock
36% bonds of which 6% are in Intl. bonds.
When we were in our late 50s our asset allocation was 65/35 equity/fixed income.

Here are two good articles on the classic 60/40 stock/bond allocation:
1) Peter Bernstein, Bloomberg Personal Finance (2002) , "The 60/40 Solution"; and
2) Rick Ferri, etf.com (2/25/15), "Wisdom Of 60/40 Portfolios Timeless"".
"Everything should be as simple as it is, but not simpler." - Albert Einstein | Wiki article link:Getting Started

User avatar
TierArtz
Posts: 246
Joined: Wed Jan 04, 2017 10:33 pm

Re: Asset allocation for those in their late fifties

Post by TierArtz » Wed Jun 12, 2019 8:30 am

I'm 57, have a military pension, a bit of farm income, and may work until I'm 62. I've picked a 60/38/2 (S/B/C) allocation and do not plan on gliding either direction or having any tilts. I'm following VG's lead with 40% International in the equities slice. I do not see the need for a separate emergency fund. I do not have any international bonds because my 401k does not offer them, and I don't want any in Roth IRAs or our taxable brokerage. I'm targeting $250k in deferred compensation by age 62 and a 5 year spend-down of that.

DetroitRick
Posts: 683
Joined: Wed Mar 23, 2016 9:28 am

Re: Asset allocation for those in their late fifties

Post by DetroitRick » Wed Jun 12, 2019 8:33 am

Me 63, Wife 59

IRA's: Me - 29% fixed income, 71% equity/other. No plans to change in coming years. Fixed income varied from 15% to 20% until my mid 50's.
Wife - 27% fixed income, 73% equity/other. Will end up around 30% fixed income within 3 years. Stable after that.

Non-Retirement taxable investments (about 21% of our invested assets): 100% equity.

Cash outside portfolio - varies between 1 and 2 years worth of net spending needs (total spending less stable, non-investment, income sources). Cash in investment portfolios is usually minimal, although I have around one year's worth of withdrawals in short-term Treasuries within IRAs.

Aggressive for age obviously, but fits our particular circumstances.

Jack FFR1846
Posts: 9328
Joined: Tue Dec 31, 2013 7:05 am

Re: Asset allocation for those in their late fifties

Post by Jack FFR1846 » Wed Jun 12, 2019 8:38 am

I did age minus 10 until I hit 60 (50/50). Then I froze the AA. It's now forever 50/50. I have international equities and just let them float.
Bogle: Smart Beta is stupid

desiderium
Posts: 814
Joined: Sat Jan 04, 2014 11:08 am

Re: Asset allocation for those in their late fifties

Post by desiderium » Wed Jun 12, 2019 9:00 am

44% Equities, 36% FI, 20% in a variety of alternative investments. Equities represent my personal risk tolerance based on 2008 experience and having achieved FI. I am still engaged in my work, so retirement not imminent but never far from consideration.

User avatar
CyclingDuo
Posts: 2311
Joined: Fri Jan 06, 2017 9:07 am

Re: Asset allocation for those in their late fifties

Post by CyclingDuo » Wed Jun 12, 2019 9:05 am

Mr.BB wrote:
Wed Jun 12, 2019 7:34 am
I was curious if you are in your late 50s what is your current asset allocations to stocks and bonds.
Right now we 56% stock/ 36% bond/ The rest is cash (our emergency fund)
U.S stock 46%/ 10% Intl stock
36% bonds of which 6% are in Intl. bonds.
Ages 57/61 in our household.

Been moving slowly these past few years to get from 80/20 down to 70/30 and slowly heading more towards 60/40 (wife's assets are already at 60/40). Most likely will keep it in that range going forward due to other parameters of income streams including continued employment, future pension income stream, future SS income streams, and the potential to turn off the DRIPs and turn on the dividend income stream.

If we were basing retirement on nest egg only, would most likely be more around 55% equity/45% bond allocation at our current ages.
"Everywhere is within walking distance if you have the time." ~ Steven Wright

eMonkey
Posts: 3
Joined: Tue Dec 08, 2015 11:31 am

Re: Asset allocation for those in their late fifties

Post by eMonkey » Wed Jun 12, 2019 3:41 pm

Age 56 and currently at 63% equity/37% bond. About 15% of the bond portion includes some CDs and iBonds. I plan to get down to 60/40 by the time I retire in 5 years or so.

User avatar
tennisplyr
Posts: 2198
Joined: Tue Jan 28, 2014 1:53 pm
Location: Sarasota, FL

Re: Asset allocation for those in their late fifties

Post by tennisplyr » Wed Jun 12, 2019 5:31 pm

Currently in my late 60s/retired 8 years and at 50/50 where we've been since my 50s.
Those who move forward with a happy spirit will find that things always work out.

jebmke
Posts: 9168
Joined: Thu Apr 05, 2007 2:44 pm

Re: Asset allocation for those in their late fifties

Post by jebmke » Wed Jun 12, 2019 5:37 pm

Ours hasn't changed in years 40/60/0
When you discover that you are riding a dead horse, the best strategy is to dismount.

retire2022
Posts: 754
Joined: Tue Oct 02, 2018 6:10 pm
Location: NYC

Re: Asset allocation for those in their late fifties

Post by retire2022 » Wed Jun 12, 2019 5:51 pm

I'm 58, 93% equities, 6% bonds

capjak
Posts: 64
Joined: Fri Sep 22, 2017 8:58 am

Re: Asset allocation for those in their late fifties

Post by capjak » Wed Jun 12, 2019 6:09 pm

57 (3 more months to retirement) and 56 (retired)

30% stock
60% Bond
10% Cash

will slowly increase to 50/45/5

WhiteMaxima
Posts: 1850
Joined: Thu May 19, 2016 5:04 pm

Re: Asset allocation for those in their late fifties

Post by WhiteMaxima » Wed Jun 12, 2019 6:36 pm

a 60/40 (balanced index) is one AA fit all folio.

togb
Posts: 172
Joined: Mon Oct 23, 2017 8:36 pm

Re: Asset allocation for those in their late fifties

Post by togb » Wed Jun 12, 2019 9:19 pm

Silk McCue wrote:
Wed Jun 12, 2019 8:00 am

Plan is to let AA drift naturally to 70/30 to age 70 as equities left untouched while covering expenses with COLA'd pension and Traditional drawdowns while performing tax efficient Roth conversions of equities.
Silk, I'm fascinated by your plan-- particular the bit I snipped above. I'm 93/7 Traditional to Roth, and would love to get to 50/50 or even 60/40 but the tax impacts seem prohibitive. I'm still working--so I contribute to external Roth and 401K Roth to the tune of about 10-15K per year. I could do more in 401K but that would be instead of tax deferred, which of course raises my taxable income.

If I wait til I retire at 65, I'll be drawing down tax deferred for living expenses, and have a 5 year window before RMDs kick in. But Roth conversions on top of drawdowns will would be at 24% if taxes tables stay the same. How can you do tax efficient conversions, on top of the taxable pension/drawdowns? I'd love to know the secret if you are willing to share.

dcabler
Posts: 954
Joined: Wed Feb 19, 2014 11:30 am

Re: Asset allocation for those in their late fifties

Post by dcabler » Wed Jun 12, 2019 9:40 pm

58 and 59 and we're around 60/40

retiredflyboy
Posts: 94
Joined: Sun Dec 02, 2018 10:02 pm

Re: Asset allocation for those in their late fifties

Post by retiredflyboy » Wed Jun 12, 2019 9:42 pm

61 DW 58 retired. 40% stock 60% bond.
Facts are stubborn things. Everything works until it doesn’t.

User avatar
nedsaid
Posts: 11561
Joined: Fri Nov 23, 2012 12:33 pm

Re: Asset allocation for those in their late fifties

Post by nedsaid » Wed Jun 12, 2019 9:44 pm

I am 59. Asset allocation is 65% stocks/35% bonds and cash.
A fool and his money are good for business.

Silk McCue
Posts: 2401
Joined: Thu Feb 25, 2016 7:11 pm

Re: Asset allocation for those in their late fifties

Post by Silk McCue » Thu Jun 13, 2019 7:33 am

togb wrote:
Wed Jun 12, 2019 9:19 pm
Silk McCue wrote:
Wed Jun 12, 2019 8:00 am

Plan is to let AA drift naturally to 70/30 to age 70 as equities left untouched while covering expenses with COLA'd pension and Traditional drawdowns while performing tax efficient Roth conversions of equities.
Silk, I'm fascinated by your plan-- particular the bit I snipped above. I'm 93/7 Traditional to Roth, and would love to get to 50/50 or even 60/40 but the tax impacts seem prohibitive. I'm still working--so I contribute to external Roth and 401K Roth to the tune of about 10-15K per year. I could do more in 401K but that would be instead of tax deferred, which of course raises my taxable income.

If I wait til I retire at 65, I'll be drawing down tax deferred for living expenses, and have a 5 year window before RMDs kick in. But Roth conversions on top of drawdowns will would be at 24% if taxes tables stay the same. How can you do tax efficient conversions, on top of the taxable pension/drawdowns? I'd love to know the secret if you are willing to share.
There is no secret. It is all tied to our unique numbers. Pension, Social Security claiming strategy, DAF funding Q4 of 2020 at age 59 1/2 to cover charitable giving for 8 years (allows more headroom for Roth conversions for 8 years) until we start QCDs at 70.5, our fixed and variable expenses plus ample extra for fun and travel once we retire while still leaving headroom for tax efficient conversions.

Based upon what I have learned here over the past 3 1/2 years I have modeled all of this and will manage that modeling against reality on a year by year basis and come back here for help via using the search box for the answers or posting a question if needed.

Tax efficient for us regarding Roth conversions is doing so in a marginal bracket that is less than what we would pay on the next dollar withdrawn from tax deferred once we are taking Social Security had we not converted.

The key is identifying the options available to you and your unique situation and making the most of them.

Wishing you the best.

Cheers

MnD
Posts: 4275
Joined: Mon Jan 14, 2008 12:41 pm

Re: Asset allocation for those in their late fifties

Post by MnD » Thu Jun 13, 2019 7:56 am

Both 56 and retired.
70/30 for life, global market cap for us/ex-US equity.
About 50% of our income comes from portfolio.

basspond
Posts: 1188
Joined: Wed Nov 27, 2013 4:01 am

Re: Asset allocation for those in their late fifties

Post by basspond » Thu Jun 13, 2019 8:04 am

Ours changed after retiring. Went up to about 30% bonds to ensure we don’t dip into our principal the first several years.

User avatar
Steelersfan
Posts: 3621
Joined: Thu Jun 19, 2008 8:47 pm

Re: Asset allocation for those in their late fifties

Post by Steelersfan » Thu Jun 13, 2019 8:20 am

I've been in a range of 55% - 60% equities for lots of years since my late fifties. I intend to stick with that.

printer86
Posts: 107
Joined: Mon Apr 25, 2016 8:45 am

Re: Asset allocation for those in their late fifties

Post by printer86 » Thu Jun 13, 2019 10:00 am

55/56 single income couple. 50-50 taxable-tax deferred.

Our tax deferred accounts are currently set at 65/35. I don't expect to draw on those funds until our mid-60's at best. The implied balance of the tax deferred accounts, plus SS and a small pension, should be enough to carry us home.

Our taxable accounts are currently 28/72 as we are in the midst of a major real estate transition. Once the RE transaction is completed, I need to decide on an AA based on my potential retirement plans. I believe that we have enough to retire now, but not fully convinced. I will seek the BH forum's advice on this in the fall.

newinvestor54
Posts: 18
Joined: Wed Apr 02, 2014 6:03 pm

Re: Asset allocation for those in their late fifties

Post by newinvestor54 » Thu Jun 13, 2019 3:37 pm

59/58 couple, one still working
45/55 equity/ fixed income -- conservative because no need for risk since we've passed our goals
equity is 75/25 us /intl
85% in taxable (lots of Munis), 10% tax deferred (401k), 5% Roth

Faith20879
Posts: 609
Joined: Fri Mar 02, 2007 10:16 am

Re: Asset allocation for those in their late fifties

Post by Faith20879 » Fri Jun 14, 2019 11:15 am

H 66 W 59, with one more year of W2 to collect, e.g., looking at class of 2020.

We are about 60% stock (70% US, 30% international) and 40% bonds/cash, with no international bonds. A small pension just enough to cover Medicare B premium.

Will probably stay with this AA into retirement.

Whatyear?
Posts: 150
Joined: Wed Aug 26, 2009 1:05 pm
Location: Massachusetts

Re: Asset allocation for those in their late fifties

Post by Whatyear? » Fri Jun 14, 2019 11:25 am

I'm 59 and my husband is 58. Hoping to retire at 62. We are about 52% equity/ 48% bonds/cash at the moment. I feel like it might be too conservative, but on the other hand I really don't want to risk losing a big chunk of it so close to retirement. I have a very small pension that is not COLA'd. I'll probably stay at this allocation until I am a little closer to collecting SS (somewhere between age 67 and 70), then go to something like 65%/35%.

scrabbler1
Posts: 2372
Joined: Fri Nov 20, 2009 2:39 pm

Re: Asset allocation for those in their late fifties

Post by scrabbler1 » Fri Jun 14, 2019 12:20 pm

I am 56 and have been retired for just over 10 years. I use only my taxable account (2/3 of my overall portfolio) to pay my expenses. Taxable is 35/65, while the rollover IRA is 47/53. Overall 41/59.

somber
Posts: 9
Joined: Mon Jan 28, 2019 1:49 pm

Re: Asset allocation for those in their late fifties

Post by somber » Fri Jun 14, 2019 12:59 pm

I'm 58, and at 100% stocks since age 24 (not counting emergency fund).

Cody6136
Posts: 218
Joined: Tue Apr 16, 2019 10:54 am

Re: Asset allocation for those in their late fifties

Post by Cody6136 » Fri Jun 14, 2019 3:46 pm

I'm 59 and currently at a 77 percent stocks, the rest in bonds/other and trying to make a smooth glide towards 60 percent stock

Rolling over and re-calibrating has been a journey, to say the least.

Hockey10
Posts: 478
Joined: Wed Aug 24, 2016 12:20 pm
Location: Philadelphia suburbs

Re: Asset allocation for those in their late fifties

Post by Hockey10 » Fri Jun 14, 2019 4:38 pm

80% stock
10% bonds
10% cash

This is the highest % bonds that I have ever had. Never owned any bonds until I was in my 50s.

MarkerFM
Posts: 92
Joined: Fri Nov 30, 2018 4:18 pm

Re: Asset allocation for those in their late fifties

Post by MarkerFM » Sun Jun 16, 2019 11:52 am

58 and 60, retired for 13 years. 70/30. Don't see that changing much other than perhaps equities creeping up a bit. Portfolio generates more cash than we spend. I'm glad to see a healthy number of folks maintaining higher equity portions.

rick2427
Posts: 114
Joined: Sun Jan 25, 2015 11:29 pm
Location: Missouri

Re: Asset allocation for those in their late fifties

Post by rick2427 » Sun Jun 16, 2019 1:07 pm

Current Age 59/59, retired at 57.
Asset allocation 70/30.
staying with this asset allocation

retiredflyboy
Posts: 94
Joined: Sun Dec 02, 2018 10:02 pm

Re: Asset allocation for those in their late fifties

Post by retiredflyboy » Sun Jun 16, 2019 10:09 pm

At or near retirement something around 50-50 seems about right. 40-60 to 60-40.
Facts are stubborn things. Everything works until it doesn’t.

Post Reply