My "after I am gone" letter to my wife suggests that she put everything in LifeStrategy Moderate (98% of the portfolio is in tax-deferred or tax-exempt).
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Prediction is very difficult, especially about the future - Niels Bohr | To get the "risk premium", you really do have to take the risk - nisiprius
Which is 50% bonds crossing the threshold into retirement (65-67). That's in my IPS and I've been gradually on my glidescope abt 43% bonds now. My concern is I have all equity (total US/international stock) in my taxable account which is about 1/3 of total portfolio so the dilemma is if we go into a bear market at retirement, I was planning on using the taxable funds to push back SS to 70. So there is an iteration to the discuss not only how much bond % for the "tent" but where the bonds are re tax deferred vs taxable. This could affect cash flow in early retirement and has tax implications, e.g. was counting on 15% marginal tax rate and 0 LTCG in early retirement.David Jay wrote: ↑Tue Dec 05, 2017 7:04 pm
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If you hold different asset classes in different locations, you can take withdrawals from the location that makes sense from a tax perspective, and then adjust the allocation of tax-qualified account(s) to maintain asset allocation. Thus, if you liquidate equities in taxable space when equities are below allocation target, you would shift other classes into equities in a tax-qualified account to maintain asset allocation.My concern is I have all equity (total US/international stock) in my taxable account which is about 1/3 of total portfolio so the dilemma is if we go into a bear market at retirement, I was planning on using the taxable funds to push back SS to 70.
Also, withdrawing from a tax-deferred account may incur more taxes due today than withdrawing from a taxable account, but drawing down the tax-deferred account will reduce future RMDs, which may reduce overall taxes in the long run.
Risk is not a guarantor of return.