Asset Allocation

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Eldorado
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Asset Allocation

Post by Eldorado » Thu Jul 11, 2019 11:17 pm

Looking for some help in developing a conservative allocation. I have a total of 750k in 2 different 401k's. I am 61 looking to retire in a year. Currently have 360k sitting in a stable value fund. 100k in s&p 500 fund, 50 k in a fidelity bond fund and 240k in a fidelity money market fund. As you can see I'm pretty conservative. I would like to have 20-30% in stocks with balance in bonds and stable value fund. I have mixed feelings on bonds. Should I move more funds into bonds? Having 100k in the s&p 500 a good idea or should I break it up some.
Just looking for some feedback and guidance. I just do not feel like I have a plan. How to turn my savings into income when I retire .

Thanks

Thesaints
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Re: Asset Allocation

Post by Thesaints » Fri Jul 12, 2019 12:10 am

In order to have 20% of assets in stocks you would need to put another 50k in your S&P500. Pwrhapa a very low cost total stock market fund would be even better, though

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Tyler Aspect
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Re: Asset Allocation

Post by Tyler Aspect » Fri Jul 12, 2019 1:11 am

Asset allocation after retirement typically runs between 60% stock / 40% bond and 40% stock / 60% bond. You are trending on the quite conservative side. An allocation of 40% stock / 60% bond had a draw-down of 28% during the last economic recession.
Past result does not predict future performance. Mentioned investments may lose money. Contents are presented "AS IS" and any implied suitability for a particular purpose are disclaimed.

MotoTrojan
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Re: Asset Allocation

Post by MotoTrojan » Fri Jul 12, 2019 1:23 am

How much will you need to withdraw annually? Unless it’s a very small number I’d be nervous with such a low equity allocation.

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Eldorado
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Re: Asset Allocation

Post by Eldorado » Fri Jul 12, 2019 6:23 am

I am thinking 24k a year. I'll take ss at 62, 1740.00 and a small pension of 950 mo.

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Tyler Aspect
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Re: Asset Allocation

Post by Tyler Aspect » Fri Jul 12, 2019 12:54 pm

If you set your asset allocation at 30% stock / 70% bond your withdrawal plan should work.

Sample portfolio

US stock 24% : VTI or VTSAX
international stock 6% : VEA or VEU
US bond 70% : BND or VBTLX

Starting Social Security at Full Retirement Age should make the number slightly better.
Past result does not predict future performance. Mentioned investments may lose money. Contents are presented "AS IS" and any implied suitability for a particular purpose are disclaimed.

Topic Author
Eldorado
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Joined: Wed Apr 25, 2018 8:43 pm

Re: Asset Allocation

Post by Eldorado » Fri Jul 12, 2019 5:47 pm

Thank you

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Wiggums
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Re: Asset Allocation

Post by Wiggums » Fri Jul 12, 2019 5:51 pm

Tylers recommendation is quite good and the amount of stocks is conservative. It would meet your requirements.

Good luck to you.

Topic Author
Eldorado
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Re: Asset Allocation

Post by Eldorado » Fri Jul 12, 2019 8:34 pm

What the difference in what Tyler's recommending and say the target retirement fund. I do like Tyler's recommendation. Bonds make me a little uneasy for some reason but that's just me. What's your view on stable value funds?
Thanks

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