just completed my first year of retirement! so far so good

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Topic Author
7out
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just completed my first year of retirement! so far so good

Post by 7out »

I retired in December 2018 at age 63. I was nervous about how retirement would go, so this past year I lived pretty simply. I get $1,875 a month from Social Security and that’s enough for me to lead the same life I was leading before retirement. My emergency fund is $40,000 and I never touched it this past year. I haven’t withdrawn anything from my IRA or 401k either. (I have around $600,000 total from several funds)

Since my income is so low, I qualify for a premium tax credit that makes my health insurance affordable. I figure once I get to Medicare age in another year, I will start withdrawing from my retirement accounts when I won’t have to sweat my incomes effect on Health Insurance.

If I can get 4% on the $600,000 and supplement my $1,875 SS income with $2,000 additional a month, I think I would be in pretty good shape for the remainder of my life.

Can I get 4% with a 30% Stock / 70% Bonds portfolio? Or maybe a 50/50? I'm sure many will cringe at me being at 100% stocks. I should quit playing with fire and re balance this portfolio in the near future.

Here is my current portfolio…

Emergency Fund: Ally Bank $41,000
Debt: No Debt
Tax Filing Status: Married
Tax Rate: 12% Federal, 0 State
State of Residence: Nevada
Age 64, Wife 54
Desired Asset Allocation: Not sure
Desired International Allocation: Not sure
The size of my current portfolio: $635,000 (incl emergency fund)
Current Assets:
Taxable
8.85% Vanguard Mid Cap Index VIMAX $52,855

His 401k (last year rolled into Vanguard)
27.69% Total Stock VTSAX $165,319

His IRA at Vanguard
37.22% Vanguard Value Index Fund Admiral Shares VVIAX $222,224

Her IRA at Vanguard
26.24% Vanguard Dividend Growth Fund VDIGX $156,685

Thank you so much for any advice or guidance you can provide!
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Sandtrap
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Re: just completed my first year of retirement! so far so good

Post by Sandtrap »

Can I get 4% with a 30% Stock / 70% Bonds portfolio? Or maybe a 50/50? I'm sure many will cringe at me being at 100% stocks. I should quit playing with fire and re balance this portfolio in the near future.
Between 60/40 and 40/60 is often quoted.
VANGUARD PORTFOLIO ALLOCATION MODELS
https://personal.vanguard.com/us/insig ... s?lang=en
Risk Tolerance (what is your "sleep factor"?)
https://www.bogleheads.org/wiki/Risk_tolerance
Asset Allocation (what is right for you?)
https://www.bogleheads.org/wiki/Asset_allocation
Outstanding write up on the 64/40 allocation by Bernstein.
http://web.archive.org/web/20061214061 ... in6040.pdf

At 100% equity allocation, how would you feel if the market had a sustained downturn and the value of your portfolio dropped by 30-50% ??

j :happy
Wiki Bogleheads Wiki: Everything You Need to Know
Topic Author
7out
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Re: just completed my first year of retirement! so far so good

Post by 7out »

I'm going to feel stupid for sure as I know I should have balanced this years ago. I think I've been living in denial because my house is paid off and I have no debt. I've thought I could push it a bit, but in reality, how much longer will I live?

That first link - Vanguard portfolio allocation models, is pretty eye opening.

Thank you very much for those links, I'm going to spend some time looking through that stuff in the morning.
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Watty
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Re: just completed my first year of retirement! so far so good

Post by Watty »

7out wrote: Fri Jan 03, 2020 9:38 pm I'm going to feel stupid for sure as I know I should have balanced this years ago. I think I've been living in denial because my house is paid off and I have no debt. I've thought I could push it a bit, but in reality, how much longer will I live?

....

Age 64, Wife 54
You can crunch the numbers with your details but there is a good chance that one of you will live to be 90 and a realistic chance that one of you will live to be 100.

https://www.longevityillustrator.org/
7out wrote: Fri Jan 03, 2020 9:18 pm I'm sure many will cringe at me being at 100% stocks.
You got lucky.

You know what you should do on Monday.
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Wiggums
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Re: just completed my first year of retirement! so far so good

Post by Wiggums »

Image

https://postimg.cc/qz6F5zPX

The chart above is discussed About half way down on this link. The heading is “Base Case Results”

https://earlyretirementnow.com/2016/12/ ... t-1-intro/


100% stocks is too risky in retirement for most people. You know what you need to do!
sycamore
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Re: just completed my first year of retirement! so far so good

Post by sycamore »

7out,

I agree with the replies from Wiggums and Watty about 100% stock being too high. What is the right stocks/fixed income asset allocation for you? After looking at many studies and threads on safe withdrawal rates and such, I came to the conclusion that there's not much difference between 35/65 and 65/35 so pick something in that range. Obviously no guarantees that you'll get 4% year end and year out, but over time I think it's a reasonable to plan for that amount, and make adjustments after a few years if it's not working out.

You've got a nice streamlined portfolio. You could easily get to a new AA by exchanging in just one or two of your IRAs/401k accounts, and thus not impact your taxable income.
Topic Author
7out
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Re: just completed my first year of retirement! so far so good

Post by 7out »

Thank you all so much for the great replies!

@Sandtrap – I read thru all 4 links and so much great information. I’m leaning towards 60/40 although 50/50 looks perfectly acceptable to me. I just did the Vanguard Investor Questionnaire and it came back with a 50/50. (I thought it might come back more aggressive, but the short horizon on when I plan to start taking money, I think made that determination.)

Should my SS income of $1,875 a month factor into the percentage I carry in bonds?

@Watty – the longevity illustrator was an interesting exercise. Unfortunately for me there isn’t a lot of longevity in my family. Hopefully I will break the trend, I kind of already have at 64. My Father and younger brother both passed at age 53 from pancreatic cancer. I am the oldest in my immediate family, that’s scary when I really think about it. My wife’s family is similar. The site gives me a 4% chance of getting to age 100 and my wife has a 10% chance. Crossing my fingers 😉

@Wiggums – That chart is awesome and very promising for the 50/50 at 4%.

I think keeping it simple is best for me as far as funds go. If it is 50/50, any opinions on just splitting it between the Vanguard Total Stock Market Index Fund Admiral Shares (VTSAX) and Vanguard Total Bond Market Index Fund Admiral Shares (VBTLX)?

Since my wife is 54, should I move her entire Vanguard Dividend Growth Fund (VDIGX) into the VTSAX and leave some of my VTSAX to make up the rest of the 50%? And then move the rest of my stuff into the Bond fund?

One big question I have is what to do with the taxable Vanguard Mid Cap Index fund (VIMAX)? Can I move that in its entirety into the Total Stock fund without receiving any type of income in 2020? I need to keep my income right where it is for Health Insurance reasons.

Thanks again for the help everyone! I really appreciate it.
Vanguard Fan 1367
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Re: just completed my first year of retirement! so far so good

Post by Vanguard Fan 1367 »

I read threads from folks who retire and soon after have a bear market. I am glad for you that you had a nice bull market for your first year.
Upton Sinclair: "It is difficult to get a man to understand something when his salary depends on his not understanding it."
Topic Author
7out
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Re: just completed my first year of retirement! so far so good

Post by 7out »

Hey sycamore, thanks for the reply. You hit on something that's been bouncing around inside my head. Are the transfers as simple as I hope they are? I just tell Vanguard that I want to turn my Vanguard IRA from the Value Index to the Total Bond and there is no effect on my taxable income? What happens with that small taxable account (VIMAX) if I choose to change it? Thanks for the help!
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JoeRetire
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Re: just completed my first year of retirement! so far so good

Post by JoeRetire »

7out wrote: Fri Jan 03, 2020 9:18 pm I retired in December 2018 at age 63. I was nervous about how retirement would go, so this past year I lived pretty simply. I get $1,875 a month from Social Security and that’s enough for me to lead the same life I was leading before retirement. My emergency fund is $40,000 and I never touched it this past year. I haven’t withdrawn anything from my IRA or 401k either. (I have around $600,000 total from several funds)
Sounds like a good year!
Can I get 4% with a 30% Stock / 70% Bonds portfolio? Or maybe a 50/50? I'm sure many will cringe at me being at 100% stocks. I should quit playing with fire and re balance this portfolio in the near future.
(cringe)
Age 64, Wife 54
Hmm.

Have you been receiving your Social Security benefits for less than a year? And were you the higher earner in your family?

If the answer to both is "Yes", you may wish to rethink your strategy and file a form SSA-521, the "Request for Withdrawal of Application". You'll have to pay back what you have received, but you'll be able to let your monthly benefits continue to grow until 70. At 70, you'll receive the highest monthly benefit you can, and more importantly your younger spouse will receive the highest tax-beneficial, inflation protected, guaranteed survivor benefits she can when you are gone.

Experiment some with https://opensocialsecurity.com/ , pretending that you haven't yet filed for benefits to see some different filing strategies.

Even if it has been more than a year since you started, you can suspend your benefits and let them grow until 70.
It's the end of the world as we know it. | It's the end of the world as we know it. | It's the end of the world as we know it. | And I feel fine.
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Watty
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Re: just completed my first year of retirement! so far so good

Post by Watty »

There is a wiki on setting up a three fund portfolio if you have not seen it.

https://www.bogleheads.org/wiki/Three-fund_portfolio

I have not read it but one of the founders of these boards recently wrote a book on three fund portfolios.

https://www.amazon.com/Bogleheads-Guide ... 481&sr=8-2

I would agree with not selling the mutual fund in the taxable account so you could just work around it. You might want to set it so that it does not automatically reinvest the dividends and capital gains distributions if you have not done that already.

I like to look at comparable target date funds see what asset allocation they use to get an idea of what asset allocation I should use. The Vanguard 2020 fund is about 50/50 in stocks in bonds.
https://investor.vanguard.com/mutual-fu ... olio/vtwnx

It sounds like you want to be more aggressive so one option would be to use the Vanguard 2020 fund in your retirement accounts and keep the midcap index fund in your taxable account. That would give you a higher stock asset allocation but it would be a lot better than what you have now.

When I retired almost all my funds where in retirement accounts so I just moved it all into target date funds. In the right situation they are an excellent choice.

Sorry to hear about your dad and brother but the prospect of having health problems would be a reason to be more conservative since the money might be needed sooner than average. That would be another reason to add bonds.
7out wrote: Sat Jan 04, 2020 10:10 am Should my SS income of $1,875 a month factor into the percentage I carry in bonds?
No, there are lots of threads where people ask that question about Social Security, Pensions, and even home equity. You can use the search box in the top right corner of most web pages to find these.

In a nutshell the main reason is that having Social Security allows you to have a smaller portfolio to have your desired income so also reducing your bond asset allocation would be double counting it. For example if are twins where one of them had worked overseas and did not get Social Security and the other would get $20,000 a year is Social Security. Then if you assume that;

a) They both need $40,000 a year to retire on
b) They will start out with a 4% safe withdrawl rate

then
a) The twin without Social Security would need a million dollar retirement portfolio since 4% of a million is $40,000
b) There twin with Social Security would only need half a million dollars since 4% of $500K is $20k.

To get their desired 4% safe withdrawl rate their asset allocation would be the same.
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cashboy
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Re: just completed my first year of retirement! so far so good

Post by cashboy »

OP

congratulations on completing your first year of retirement!

i also retired in 2018 (july) - courtesy of megacorp job eliminations :?

i have a 'three fund portfolio' and my AA is 50/50. i sleep well at night.

good luck to us both in year two! :sharebeer
Three-Fund Portfolio: FSPSX - FXAIX - FXNAX (with slight tilt of CDs - CASH - Canned Beans - Rice - Bottled Water)
sycamore
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Re: just completed my first year of retirement! so far so good

Post by sycamore »

7out wrote: Sat Jan 04, 2020 10:18 am Hey sycamore, thanks for the reply. You hit on something that's been bouncing around inside my head. Are the transfers as simple as I hope they are? I just tell Vanguard that I want to turn my Vanguard IRA from the Value Index to the Total Bond and there is no effect on my taxable income? What happens with that small taxable account (VIMAX) if I choose to change it? Thanks for the help!
For the IRA, you can simply exchange the Value Index fund to Total Bond (ticker VBTLX). Technically, that's selling of one and buying the other, but it really is that simple. As long as you're not taking a distribution (e.g., making a withdrawal) it's not a taxable event.

For the taxable account it's different. Doing an exchange or just a plain sell would be a taxable event and would increase your taxable income (I'm assuming it's gained in value since you bought it). You mentioned earlier getting a premium tax credit so I think selling VIMAX at this time is not a good idea. Losing some/all of the premium tax credit would be essentially paying a high marginal tax rate. Much better to adjust your AA using your tax-advantaged IRA or 401k accounts for now.

Cheers
Topic Author
7out
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Re: just completed my first year of retirement! so far so good

Post by 7out »

@JoeRetire,
You suggest a very interesting wrinkle to the whole plan. I received my first benefit in Feb 2019. If I was to payback the 20k out of my emergency fund, I would still have half of it left. I would now live off the remainder for 2020? and then live off my IRA until age 70?

One of the keys to pulling off this retirement was Health Insurance. As I approached 62, I thought I had no chance (at retirement) as the premiums were so high. The premium tax credit was the key for me. Because of my income, I get a tax credit of $1,292 this year. (2019 I received a credit of 1,374) In 2019 after the credit, Health Insurance cost me $65 a month, this year it will be $317 after the credit. Without that tax credit (those plans would be $1,600+ a month) I would have to keep working. If I have no income from SS, I would fall into the Medicaid range. Although from what I understand, I can’t qualify for Medicaid because I have over $2,000 in savings. I’m not sure how medical would work with your plan. I will have to do some research.

Thanks for the suggestion JoeRetire!

@Watty - Thanks for the links, I need to consider the International Fund. It seems many follow the 3-fund portfolio. 42% Total Stock Market Index, 18% Total International Stock Index, and 40% Total Bond Market fund might be an interesting way to go.

The taxable fund has always been set to reinvest dividends and capital gains; you think I would be better off in not reinvesting that? Great idea looking into target date funds to see what their asset allocations are. The twin’s example is helpful. Thank you again!

@cashboy – Thank you for your reply. It’s time for me to join you in getting a restful night’s sleep 😉

@ sycamore – Awesome, thanks for helping me understand how that taxable account is going to work as well as the upcoming exchange. The VIMAX was started about 15 years ago with a $10,000 dollar lump sum. I did a $100-dollar monthly auto invest for a few years (stopped that when I retired last year) I figure maybe I put in $15,000 tops of my money. I’m going to take your advice and ignore that fund for now. So, when I finally do something with it, will I only owe taxes on the $35,000 it has gained over the years or the total value? I really appreciate your help!
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David Jay
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Re: just completed my first year of retirement! so far so good

Post by David Jay »

Same here (so far so good), I retired in January, 2019 at age 62. What a great year to retire, sort of a reverse sequence-of-returns outlier! I withdrew 6.7% of my retirement portfolio (delaying SS to age 70) and 2019 year end portfolio value was up 3.6% from 2018 year end.

Because 2019 was a great year for stocks, you have even more pressure to get your Asset Allocation changes under way. 50/50 is a reasonable AA - anything from 60/40 to 40/60 would be good.
Prediction is very difficult, especially about the future - Niels Bohr | To get the "risk premium", you really do have to take the risk - nisiprius
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7out
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Re: just completed my first year of retirement! so far so good

Post by 7out »

@David Jay – That’s Awesome! Congratulations

I’ve spent the weekend reading through all the materials and getting a game plan together. To start, just going to keep it simple and do a 60/40 AA.

Leaving the taxable account out of the mix (VIMAX) to keep my Health Insurance Premiums the same.

My entire IRA (Value Index VVIAX) will go into the Total Bond Market which will be just shy of 41% of the portfolio. The big question is what to do with my wife’s IRA (she’s 54). First thought was to put it all into the Total Stock (VTSAX), but as I looked closer at the current fund, I wonder if that’s the right move?

Her IRA is in the Dividend Growth Fund and it has the highest expense ratio of any of our funds at 0.22%. Comparing what it has done over the years, if I’m reading these charts correctly, looks like it has outperformed the Total Stock Fund.

Image



My plan is…
VVIAX rolled into VBTLX ending up with 40% of the portfolio
VDIGX rolled into VTSAX ending up with 29%
VTSAX stays where it is with 31%

I also had the Total Intl Stock on that comparison, the numbers didn’t look as good. Is that a bad idea not having a piece of the international market? I was considering it after reading about the 3 fund portfolio’s, the numbers made me second guess it.

What do you think of that plan? Should I roll my wife’s VDIGX into the VTSAX or leave it alone?

Thanks Everyone for helping me.
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Wiggums
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Re: just completed my first year of retirement! so far so good

Post by Wiggums »

Congratulations on making the decision to change you AA to 60/40.

I hold the three fund portfolio. I never had the dividend growth fund so you know I would go with VTSAX.

Disadvantages of Dividend Stocks to consider:
Although dividend stocks can provide a steady income stream, they're also susceptible to falling stock prices, business costs and double taxation. And slow, steady growth might not always be an attractive feature, depending on your investment style and needs.

1. Double Taxation
Dividends suffer from the burden of double taxation. First, the income that's earned by a company is taxed by the government at the company's tax rate. Then, you'll have to pay tax on that dividend when you file your return. If a company chooses to reinvest its profits rather than distribute them to shareholders, the double taxation problem is avoided.

2. Reinvestment Over Distribution
Some investors believe that a company can grow faster if it reinvests its cash flow into financing its operations, rather than distributing those profits to shareholders. Indeed, many rapidly growing companies choose to use profits to fund the expansion of their business rather than paying those profits out. A dividend reduces the amount of money a company keeps on hand, giving it less capital to invest in the future growth of the business.

3. Low Growth, Low Income
The best dividend stocks are often larger, more established businesses that are more reliable than explosive when it comes to earnings. Although a regular income stream is attractive, growth investors tend to shy away from blue-chip stocks in favor of more aggressive, cutting-edge companies that offer higher risk and reward. If you're an income investor, you might be able to generate more income by purchasing more traditional income investments, such as bonds.

4. Risk of Dividend Cut
The dividend amount that a company pays relative to its total net income is known as its dividend payout ratio. Although a high payout ratio might seem like a good thing, if a company's dividend per share is too high, it might be unsustainable going forward. If that dividend gets cut in the future, the stock price could suffer tremendously.

Sometimes, the reason a dividend seems high is because a company's stock price has already fallen dramatically, often as a result of falling earnings. A company with falling earnings does not instill confidence for dividend payments.
TheNightsToCome
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Re: just completed my first year of retirement! so far so good

Post by TheNightsToCome »

Watty wrote: Fri Jan 03, 2020 9:55 pm
7out wrote: Fri Jan 03, 2020 9:38 pm I'm going to feel stupid for sure as I know I should have balanced this years ago. I think I've been living in denial because my house is paid off and I have no debt. I've thought I could push it a bit, but in reality, how much longer will I live?

....

Age 64, Wife 54
You can crunch the numbers with your details but there is a good chance that one of you will live to be 90 and a realistic chance that one of you will live to be 100.

https://www.longevityillustrator.org/
7out wrote: Fri Jan 03, 2020 9:18 pm I'm sure many will cringe at me being at 100% stocks.
You got lucky.

You know what you should do on Monday.
This (https://www.longevityillustrator.org/) is very helpful, but you might also want to look at this actuarial calculator which allows you to enter more data specific to your circumstances: https://apps.goldensoncenter.uconn.edu/HLEC/
Dottie57
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Re: just completed my first year of retirement! so far so good

Post by Dottie57 »

David Jay wrote: Sat Jan 04, 2020 3:56 pm Same here (so far so good), I retired in January, 2019 at age 62. What a great year to retire, sort of a reverse sequence-of-returns outlier! I withdrew 6.7% of my retirement portfolio (delaying SS to age 70) and 2019 year end portfolio value was up 3.6% from 2018 year end.

Because 2019 was a great year for stocks, you have even more pressure to get your Asset Allocation changes under way. 50/50 is a reasonable AA - anything from 60/40 to 40/60 would be good.
Agree with a lot of pressure to change AA this week. Go to 60/40 at least. Do you really want to sell stocks income after they are worth a lot less? I don’t.
Broken Man 1999
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Re: just completed my first year of retirement! so far so good

Post by Broken Man 1999 »

Congrats to getting a great start in your retirement! Hope you and your wife have many more years to enjoy your efforts leading to retirement.

Now, instead of "getting there" finacially, you need to pivot to "staying there" financially. That is a totally different activity.

So, as so many others have stated, buy yourself some bonds, or CDs.

So far as an AA, DW and I are at 50% equities and 50% bonds. I like that AA as I don't need anything but a quick look to see how our portfolio is tracking our desired AA. But 60/40 is fine as well.

I wish you continued success in retirement!

:sharebeer

Broken Man 1999
“If I cannot drink Bourbon and smoke cigars in Heaven then I shall not go. " -Mark Twain
sycamore
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Re: just completed my first year of retirement! so far so good

Post by sycamore »

7out wrote: Sat Jan 04, 2020 2:56 pm @ sycamore – Awesome, thanks for helping me understand how that taxable account is going to work as well as the upcoming exchange. The VIMAX was started about 15 years ago with a $10,000 dollar lump sum. I did a $100-dollar monthly auto invest for a few years (stopped that when I retired last year) I figure maybe I put in $15,000 tops of my money. I’m going to take your advice and ignore that fund for now. So, when I finally do something with it, will I only owe taxes on the $35,000 it has gained over the years or the total value? I really appreciate your help!
@ 7out, when you sell something held in a taxable account, you're only taxed on the gains. You don't pay tax on your basis which in your case is the $15,000 or so you put into it. The tax rate depends on your holding period: under one year, you pay income tax rate; over one year, you pay a long-term capital gains rate of 0%, 15% or 20% depending on your total taxable income that year.

Looking ahead a couple years when you're of Medicare age (past the concern about the premium tax credit), if your total income (including gains from selling VIMAX) is less than approx $80,000, you'd pay 0% federal tax on the the gains, which is really great :)
There are other variables at play (like how much of your SS income get treated as taxable income) so best to use a calculator. Something to look forward to...
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tennisplyr
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Re: just completed my first year of retirement! so far so good

Post by tennisplyr »

Just turned 70 been retired for about 9 years and am at 50/50 AA for years. Plan to slide back to ~40/60 in future. Life is good :beer
Those who move forward with a happy spirit will find that things always work out.
jebmke
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Re: just completed my first year of retirement! so far so good

Post by jebmke »

tennisplyr wrote: Sun Jan 05, 2020 6:18 pm Just turned 70 been retired for about 9 years and am at 50/50 AA for years. Plan to slide back to ~40/60 in future. Life is good :beer
interesting. Will turn 67 this month. I just finished 12 years retired; started at 40/60 and plan to slide up to at least 70/30 if growth produces that mix. In other words, I have no plans to re-balance on the upside for quite some time until my mix is back up to 70/30. I have cleared the 10-year window with no pension and no SS. Just goes to show that there are no "rules" of thumb.
When you discover that you are riding a dead horse, the best strategy is to dismount.
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7out
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Re: just completed my first year of retirement! so far so good

Post by 7out »

@ Wiggums – Thank you for breaking down the Dividend Stocks fund. You made it easy for me to exchange that for the Total Stock.

@ TheNightsToCome – Thanks for the actuarial calculator, I feel a little better about the number I’m getting from that.

@ Dottie57 – Agreed, I don’t want to do that either. Thanks for the reply.

@ Broken Man 1999 -Thank you for the encouraging words!

@ sycamore – Good news about the possibility of paying 0% on the taxable. Thanks again for teaching me how this works.

@ tennisplyr @jebmke – interesting that tennisplyr is planning to slide to a bit more bonds, and jebmke is moving in the opposite direction.

I really appreciate all the advice, I feel a lot better about rebalancing now and have a better understanding of the process.
Mr.BB
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Re: just completed my first year of retirement! so far so good

Post by Mr.BB »

Wiggums wrote: Fri Jan 03, 2020 10:04 pm Image

https://postimg.cc/qz6F5zPX

The chart above is discussed About half way down on this link. The heading is “Base Case Results”

https://earlyretirementnow.com/2016/12/ ... t-1-intro/


100% stocks is too risky in retirement for most people. You know what you need to do!
+1
"We are what we repeatedly do. Excellence, then, is not an act, but a habit."
dpm321
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Re: just completed my first year of retirement! so far so good

Post by dpm321 »

Sandtrap wrote: Fri Jan 03, 2020 9:26 pm
Can I get 4% with a 30% Stock / 70% Bonds portfolio? Or maybe a 50/50? I'm sure many will cringe at me being at 100% stocks. I should quit playing with fire and re balance this portfolio in the near future.
Between 60/40 and 40/60 is often quoted.
VANGUARD PORTFOLIO ALLOCATION MODELS
https://personal.vanguard.com/us/insig ... s?lang=en
Risk Tolerance (what is your "sleep factor"?)
https://www.bogleheads.org/wiki/Risk_tolerance
Asset Allocation (what is right for you?)
https://www.bogleheads.org/wiki/Asset_allocation
Outstanding write up on the 64/40 allocation by Bernstein.
http://web.archive.org/web/20061214061 ... in6040.pdf

At 100% equity allocation, how would you feel if the market had a sustained downturn and the value of your portfolio dropped by 30-50% ??

j :happy
The last linked article (Bernstein) looks interesting but all I can get is a partial first page. Is there a secret to accessing the article? Thanks.
Jazzysoon
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Re: just completed my first year of retirement! so far so good

Post by Jazzysoon »

After you turn 65 and are on Medicare, what is your plan for your wife's heath insurance until she qualifies for Medicare? You may still need to manage your AGI/MAGI if you want to continue with ACA for her.
Last edited by Jazzysoon on Mon Jan 06, 2020 9:28 am, edited 1 time in total.
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Sandtrap
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Re: just completed my first year of retirement! so far so good

Post by Sandtrap »

dpm321 wrote: Mon Jan 06, 2020 8:36 am
Sandtrap wrote: Fri Jan 03, 2020 9:26 pm
Can I get 4% with a 30% Stock / 70% Bonds portfolio? Or maybe a 50/50? I'm sure many will cringe at me being at 100% stocks. I should quit playing with fire and re balance this portfolio in the near future.
Between 60/40 and 40/60 is often quoted.
VANGUARD PORTFOLIO ALLOCATION MODELS
https://personal.vanguard.com/us/insig ... s?lang=en
Risk Tolerance (what is your "sleep factor"?)
https://www.bogleheads.org/wiki/Risk_tolerance
Asset Allocation (what is right for you?)
https://www.bogleheads.org/wiki/Asset_allocation
Outstanding write up on the 64/40 allocation by Bernstein.
http://web.archive.org/web/20061214061 ... in6040.pdf

At 100% equity allocation, how would you feel if the market had a sustained downturn and the value of your portfolio dropped by 30-50% ??

j :happy
The last linked article (Bernstein) looks interesting but all I can get is a partial first page. Is there a secret to accessing the article? Thanks.
The link works. Perhaps check your browser. It is a PDF file. Short article. 2 page.
Here are the links again to Bernstein's 60/40 write up.
Also, comments by Rick Ferri.
Outstanding write up on the 64/40 allocation by Bernstein.
http://web.archive.org/web/20061214061 ... in6040.pdf
R. Ferri on Bernstein's 60/40
http://www.etf.com/sections/index-inve ... nopaging=1

j :happy
Wiki Bogleheads Wiki: Everything You Need to Know
lakpr
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Re: just completed my first year of retirement! so far so good

Post by lakpr »

dpm321 wrote: Mon Jan 06, 2020 8:36 am The last linked article (Bernstein) looks interesting but all I can get is a partial first page. Is there a secret to accessing the article? Thanks.
I have often seen that the PDF files end up downloaded to your "Downloads" or "Documents" folder if you are browsing on a PC, or you may have to go to a Files --> Downloads in Android. Not sure about Safari on Apple products.
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7out
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Re: just completed my first year of retirement! so far so good

Post by 7out »

@ Jazzysoon
After you turn 65 and are on Medicare, what is your plan for your wife's heath insurance until she qualifies for Medicare? You may still need to manage your AGI/MAGI if you want to continue with ACA for her.
That is a big question that I haven't really thought about yet. That is frightening to think I might still have to manage my AGI/MAGI for many more years. She is originally from Singapore and has kept her countries citizenship. (Singapore doesn't allow dual) She also has never had a job in the 21 years she has been in this country. She has always been a housewife. Will she be able to get Medicare when she turns 65 in 10 years as a Resident Alien?

Thanks for bringing up this very important point.
Jazzysoon
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Re: just completed my first year of retirement! so far so good

Post by Jazzysoon »

7out wrote: Mon Jan 06, 2020 12:33 pm @ Jazzysoon
After you turn 65 and are on Medicare, what is your plan for your wife's heath insurance until she qualifies for Medicare? You may still need to manage your AGI/MAGI if you want to continue with ACA for her.
That is a big question that I haven't really thought about yet. That is frightening to think I might still have to manage my AGI/MAGI for many more years. She is originally from Singapore and has kept her countries citizenship. (Singapore doesn't allow dual) She also has never had a job in the 21 years she has been in this country. She has always been a housewife. Will she be able to get Medicare when she turns 65 in 10 years as a Resident Alien?

Thanks for bringing up this very important point.
Hopefully someone with some experience with Resident Alien insurance can chime in, but a quick google indicates at her age 65 without any work credits she won't be eligible for Medicare Part A, as to the rest it gets complicated. After you turn 65 you will have quite a few years to need to get coverage for her. A lot of people get a part time job just for health insurance coverage, don't know if that is something that will work for her to do.
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7out
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Re: just completed my first year of retirement! so far so good

Post by 7out »

Thank You Jazzysoon,

I'm glad you brought this up, give me some time to figure it out.
Lalamimi
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Re: just completed my first year of retirement! so far so good

Post by Lalamimi »

She is originally from Singapore and has kept her countries citizenship. (Singapore doesn't allow dual) She also has never had a job in the 21 years she has been in this country. She has always been a housewife. Will she be able to get Medicare when she turns 65 in 10 years as a Resident Alien?

[/quote]

My friend's husband is from Germany, and he can get insurance there. Can she get something from Singapore?
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7out
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Re: just completed my first year of retirement! so far so good

Post by 7out »

Hi Lalamimi, thanks for the question. I asked my wife, she doesn't know off hand, but is going to check into it.
lakpr
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Re: just completed my first year of retirement! so far so good

Post by lakpr »

7out wrote: Wed Jan 08, 2020 10:35 am Hi Lalamimi, thanks for the question. I asked my wife, she doesn't know off hand, but is going to check into it.
Once you complete 5 years in this country as a Resident Alien, you are eligible to apply for citizenship. Is there a specific reason why your wife is not contemplating picking up US citizenship? Not sure if that act of being a US citizen will make her eligible for Medicare, or if there is a waiting period before she's eligible.
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7out
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Re: just completed my first year of retirement! so far so good

Post by 7out »

Hey lakpr,

Unfortunately Singapore doesn't allow dual citizenship. She has always wanted to retain her countries citizenship. I've never pressured her into giving it up even after 21 years here. Her wishes have made it difficult on me. ;) If I should pass before her (I am 10 years her senior) at least she can go back home easy enough.
WhiteMaxima
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Re: just completed my first year of retirement! so far so good

Post by WhiteMaxima »

Do Roth conversion!
lakpr
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Re: just completed my first year of retirement! so far so good

Post by lakpr »

7out wrote: Wed Jan 08, 2020 6:12 pm Hey lakpr,

Unfortunately Singapore doesn't allow dual citizenship. She has always wanted to retain her countries citizenship. I've never pressured her into giving it up even after 21 years here. Her wishes have made it difficult on me. ;) If I should pass before her (I am 10 years her senior) at least she can go back home easy enough.
Yes you did mention about Singapore not allowing dual citizenship. Sorry I should have been explicit about renouncing Singapore citizenship in favor of US citizenship. My doubt is answered, though; a strong preference for citizenship of one's birth country is quite understandable and I won't question it.
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