Once bitten twice shy

Have a question about your personal investments? No matter how simple or complex, you can ask it here.
Post Reply
Topic Author
Leanmac61
Posts: 3
Joined: Sun May 31, 2020 9:03 am

Once bitten twice shy

Post by Leanmac61 »

Hi bogleheads... I am 61 and retired with a state pension that covers my monthly expenses.
No mortgage with a 18 month emergency fund. I am transferring my retirement accounts from a brokerage firm. Just completed my IPS and planning on putting my assets in vanguard target retirement income fund (vtinx). AA is 30-70, plan on withdrawing 3% a year.
I admit that my risk tolerance is not high. Stay the course and tune out the noise. Hoping to earn 3-5% a year long term. Need to be conservative so I can sleep at night. Is this the right fund for me. Thanks
sycotik
Posts: 30
Joined: Thu Mar 04, 2010 4:51 am

Re: Once bitten twice shy

Post by sycotik »

With the limited information you provided, I see no issue with your selection. Sounds like you have your house in order concerning financials. Good luck and enjoy retirement.
livesoft
Posts: 73338
Joined: Thu Mar 01, 2007 8:00 pm

Re: Once bitten twice shy

Post by livesoft »

I think it is a great fund for you.
Wiki This signature message sponsored by sscritic: Learn to fish.
User avatar
White Coat Investor
Posts: 14848
Joined: Fri Mar 02, 2007 9:11 pm
Location: Greatest Snow On Earth

Re: Once bitten twice shy

Post by White Coat Investor »

livesoft wrote: Sun Jun 07, 2020 10:01 am I think it is a great fund for you.
Agreed. Note that the pension allows you to take on more risk than you otherwise could, but also lowers your need to take risk. Of course, neither of those trump your ability to take risk.
1) Invest you must 2) Time is your friend 3) Impulse is your enemy | 4) Basic arithmetic works 5) Stick to simplicity 6) Stay the course
retired@50
Posts: 3466
Joined: Tue Oct 01, 2019 2:36 pm
Location: Living in the U.S.A.

Re: Once bitten twice shy

Post by retired@50 »

Leanmac61 wrote: Sun Jun 07, 2020 9:55 am Hi bogleheads... I am 61 and retired with a state pension that covers my monthly expenses.
No mortgage with a 18 month emergency fund. I am transferring my retirement accounts from a brokerage firm. Just completed my IPS and planning on putting my assets in vanguard target retirement income fund (vtinx). AA is 30-70, plan on withdrawing 3% a year.
I admit that my risk tolerance is not high. Stay the course and tune out the noise. Hoping to earn 3-5% a year long term. Need to be conservative so I can sleep at night. Is this the right fund for me. Thanks
Given the statement above, I can't think of a single piece of advice that you need. You're wise beyond your years.

Regards,
This is one person's opinion. Nothing more.
User avatar
BolderBoy
Posts: 5011
Joined: Wed Apr 07, 2010 12:16 pm
Location: Colorado

Re: Once bitten twice shy

Post by BolderBoy »

Well done! I agree with the other posters above, VTINX is a good choice for you. (disclaimer: I'm considering moving to VTINX in the near-term future)
"Never underestimate one's capacity to overestimate one's abilities" - The Dunning-Kruger Effect
User avatar
ruralavalon
Posts: 19447
Joined: Sat Feb 02, 2008 10:29 am
Location: Illinois

Re: Once bitten twice shy

Post by ruralavalon »

Leanmac61 wrote: Sun Jun 07, 2020 9:55 am Hi bogleheads... I am 61 and retired with a state pension that covers my monthly expenses.
No mortgage with a 18 month emergency fund. I am transferring my retirement accounts from a brokerage firm. Just completed my IPS and planning on putting my assets in vanguard target retirement income fund (vtinx). AA is 30-70, plan on withdrawing 3% a year.
I admit that my risk tolerance is not high. Stay the course and tune out the noise. Hoping to earn 3-5% a year long term. Need to be conservative so I can sleep at night. Is this the right fund for me. Thanks
That is a good plan in my opinion.

Rick Ferri, Forbes (2/6/2015), "The Center of Gravity for Retirees".
"Everything should be as simple as it is, but not simpler." - Albert Einstein | Wiki article link:Getting Started
retiredjg
Posts: 41909
Joined: Thu Jan 10, 2008 12:56 pm

Re: Once bitten twice shy

Post by retiredjg »

Your plan looks reasonable. Is that what you wanted to know?
Buckrodgerz
Posts: 13
Joined: Sun Jun 07, 2020 12:16 pm

Re: Once bitten twice shy

Post by Buckrodgerz »

Answer is yes. But, watch out for inflation. 40/60 might be better until you are 70 if a short market downturn will not hit your budget. 3% out sounds good!
1130Super
Posts: 523
Joined: Thu Nov 07, 2019 8:59 am
Location: Minnesota

Re: Once bitten twice shy

Post by 1130Super »

Buckrodgerz wrote: Sun Jun 07, 2020 12:49 pm Answer is yes. But, watch out for inflation. 40/60 might be better until you are 70 if a short market downturn will not hit your budget. 3% out sounds good!
Wondering if pension is adjusted for inflation and how safe the pension is? What is Soc security strategy? Some of the bonds might want to be inflation protected with a 30/70 AA?
User avatar
gr7070
Posts: 1464
Joined: Fri Oct 28, 2011 10:39 am

Re: Once bitten twice shy

Post by gr7070 »

1130Super wrote: Sun Jun 07, 2020 12:58 pm Some of the bonds might want to be inflation protected with a 30/70 AA?
FYI 22% of those bonds are are short-term TIPS.
cherijoh
Posts: 6591
Joined: Tue Feb 20, 2007 4:49 pm
Location: Charlotte NC

Re: Once bitten twice shy

Post by cherijoh »

White Coat Investor wrote: Sun Jun 07, 2020 10:06 am
livesoft wrote: Sun Jun 07, 2020 10:01 am I think it is a great fund for you.
Agreed. Note that the pension allows you to take on more risk than you otherwise could, but also lowers your need to take risk. Of course, neither of those trump your ability to take risk.
Did you mean "...neither of those trumps your willingness to take risk"? You already mentioned that the OP was able to take risk because of the pension.
HomeStretch
Posts: 4990
Joined: Thu Dec 27, 2018 3:06 pm

Re: Once bitten twice shy

Post by HomeStretch »

Good plan.

If you decide you prefer less or more equity in your portfolio, two equally good choices IMO are the Vanguard LifeStrategy Funds VASIX (20% equity) and VSCGX (40% equity).
bck63
Posts: 1317
Joined: Fri Sep 28, 2018 4:59 pm

Re: Once bitten twice shy

Post by bck63 »

Leanmac61 wrote: Sun Jun 07, 2020 9:55 am Hi bogleheads... I am 61 and retired with a state pension that covers my monthly expenses.
No mortgage with a 18 month emergency fund. I am transferring my retirement accounts from a brokerage firm. Just completed my IPS and planning on putting my assets in vanguard target retirement income fund (vtinx). AA is 30-70, plan on withdrawing 3% a year.
I admit that my risk tolerance is not high. Stay the course and tune out the noise. Hoping to earn 3-5% a year long term. Need to be conservative so I can sleep at night. Is this the right fund for me. Thanks
VTINX has an equity allocation that includes 40% international stock. You may want to consider a simple portfolio of 30% Vanguard S&P 500 index fund (VFIAX) and 70% Vanguard total bond market index fund (VBTLX). This would allow you to avoid chronically-underperforming, anemic international stocks. A simple backtesting over the past 30+ years will demonstrate this chronic underperformance. Since your money will be in retirement accounts, you can easily rebalance to 30/70 without tax consequences.
absolute zero
Posts: 502
Joined: Thu Dec 29, 2016 4:59 pm

Re: Once bitten twice shy

Post by absolute zero »

Sounds like a good plan, but just to clarify. If your pension is going to cover your expenses, what are you going to do with the 3% that you’ll withdraw from the portfolio? Fun money?
Post Reply