Abundance came late, now I'm overwhelmed playing catch up

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NewTimes
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Abundance came late, now I'm overwhelmed playing catch up

Post by NewTimes » Thu Jul 12, 2018 1:03 pm

2012 to 2017 were productive years. Sold our business, rental homes, owner financed some real estate and ended up with $300,000 cash to invest. Wife is ultra, ultra conservative and only wants CD's. To do something, bought I bought 1 year CDs at local bank for 2.37%, and this week a 2 year CD at Purepoint for 2.75%. I've got about a $100k sitting in a savings account now. First 35 years of work only produced a SEP at current value of $5,900 as remaining funds were used to exists and keep the business going.

From reading on the Early Retirement forum I learned about Mr. Bogle and Bogleheads.org. I have read about 2/3 so far "Bogleheads Guide to Investing". Like many here have stated, it was eye opening being concise, simple and understandable. I've spent the last 2 weeks, reading, studying websites and fumbling around trying to apply investment principles I've learned so far. If I had only taken the time to educate myself earlier I would not be in the fix I am now at 65. But only a fool would not take actions and not ask those wiser than he for input. Hence, here's a request for suggestions.

My dilemma is to trying to pull it together with wise investments, and keep peace with the wife and her skittish feelings. We were greedy and stupid with the Dot.com era and lost about $25k, which was a huge amount for us at the time.

Details
Me 65, wife 66
- $100,000 to invest now, and my hope is to be comfortable when the CDs renew within a year to make wise investments (and have wife comfortable)
- no debt, home paid off
- hopefully positioned to go 10 years without touching the $100,000 (and more) and then begin a small monthly drawdown.

I'm asking for some pointers to point me in the right direction as mutual funds, bonds, Life Strategy, Target Retirement, ETFs and more are swirling in my head. I'm fumbling around with tons of printed material on my desk recommending this and recommending that. This is my first post and am enjoying reading, the banter, and becoming educated on investing. I was pretty good in my real estate investments, and am now paying the price for being lackadaisical in market investing. Hoping for help in Daytona.

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David Jay
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Re: Abundance came late, now I'm overwhelmed playing catch up

Post by David Jay » Thu Jul 12, 2018 2:26 pm

Welcome to the forum.

First, you will likely have to "negotiate" an asset allocation (ratio of stocks to bonds) for peace in the family. We would strongly recommend some level of equities (stocks) to provide some growth and inflation protection. Widely regarded author (and BH member) Rick Ferri suggests that 30% stocks, 70% bonds is the "sweet spot" for retirees. A HUGE market drop will likely be just a single-digit (i.e. less than 10%) drop in this portfolio, while participating in some market gains over the next 10 years. The bond allocation should outperform CDs as well.

There is a single fund with this allocation: TargetRetirement Income (TR funds are actually "wrappers" that hold multiple funds under-the-covers so you don't have to mess with any of that). That fund is where I would start.
Prediction is very difficult, especially about the future - Niels Bohr | To get the "risk premium", you really do have to take the risk - nisiprius

delamer
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Re: Abundance came late, now I'm overwhelmed playing catch up

Post by delamer » Thu Jul 12, 2018 2:30 pm

In addition to the $300,000 cash plus the SEP, do you have any other liquid assets?

You mentioned real estate — do you own any property that is producing income?

Are you currently working or collecting Social Security?

Lastly, do you know your expenses going forward? Do you have a goal for the cash?

You will get better advice on investing the $300,000 if we have a complete picture of your finances.

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NewTimes
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Re: Abundance came late, now I'm overwhelmed playing catch up

Post by NewTimes » Thu Jul 12, 2018 2:39 pm

David Jay wrote:
Thu Jul 12, 2018 2:26 pm
Welcome to the forum.

First, you will likely have to "negotiate" an asset allocation (ratio of stocks to bonds) for peace in the family. We would strongly recommend some level of equities (stocks) to provide some growth and inflation protection. Widely regarded author (and BH member) Rick Ferri suggests that 30% stocks, 70% bonds is the "sweet spot" for retirees. A HUGE market drop will likely be just a single-digit (i.e. less than 10%) drop in this portfolio, while participating in some market gains over the next 10 years. The bond allocation should outperform CDs as well.

There is a single fund with this allocation: TargetRetirement Income (TR funds are actually "wrappers" that hold multiple funds under-the-covers so you don't have to mess with any of that). That fund is where I would start.
Thanks for the welcome and comment. The ratio of stocks to bonds is what my gut is telling me is the best fit. The Target Retirement Income Fund is one that I have highlighted and appeared numerous times for folks in our position.

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NewTimes
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Re: Abundance came late, now I'm overwhelmed playing catch up

Post by NewTimes » Thu Jul 12, 2018 2:54 pm

delamer wrote:
Thu Jul 12, 2018 2:30 pm
In addition to the $300,000 cash plus the SEP, do you have any other liquid assets?
None liquid but two small real estate parcels

You mentioned real estate — do you own any property that is producing income?
non income producing, a vacant commercial lot and a recreational river front lot

Are you currently working or collecting Social Security?
I have one client who I expect to conclude working with this year. I begin to collect SS in April 2019

Lastly, do you know your expenses going forward? Do you have a goal for the cash?
I have budgeted my expenses and have a very good idea of the cash outlay each month. Goal for the cash is to draw down in 10 years $1,000 per month. I have not set a goal for the amount of cash I anticipate to need

You will get better advice on investing the $300,000 if we have a complete picture of your finances.

delamer
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Re: Abundance came late, now I'm overwhelmed playing catch up

Post by delamer » Thu Jul 12, 2018 3:14 pm

NewTimes wrote:
Thu Jul 12, 2018 2:54 pm
delamer wrote:
Thu Jul 12, 2018 2:30 pm
In addition to the $300,000 cash plus the SEP, do you have any other liquid assets?
None liquid but two small real estate parcels

You mentioned real estate — do you own any property that is producing income?
non income producing, a vacant commercial lot and a recreational river front lot

Are you currently working or collecting Social Security?
I have one client who I expect to conclude working with this year. I begin to collect SS in April 2019

Lastly, do you know your expenses going forward? Do you have a goal for the cash?
I have budgeted my expenses and have a very good idea of the cash outlay each month. Goal for the cash is to draw down in 10 years $1,000 per month. I have not set a goal for the amount of cash I anticipate to need

You will get better advice on investing the $300,000 if we have a complete picture of your finances.
So you want to take $1,000/month from the current $300,000, beginning in 10 years? And you would take that amount for the rest of your life? Is that $1,000 in 2018 dollars or in 2028 dollars?

Dottie57
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Re: Abundance came late, now I'm overwhelmed playing catch up

Post by Dottie57 » Thu Jul 12, 2018 3:16 pm

NewTimes wrote:
Thu Jul 12, 2018 2:54 pm
delamer wrote:
Thu Jul 12, 2018 2:30 pm
In addition to the $300,000 cash plus the SEP, do you have any other liquid assets?
None liquid but two small real estate parcels

You mentioned real estate — do you own any property that is producing income?
non income producing, a vacant commercial lot and a recreational river front lot

Are you currently working or collecting Social Security?
I have one client who I expect to conclude working with this year. I begin to collect SS in April 2019

Lastly, do you know your expenses going forward? Do you have a goal for the cash?
I have budgeted my expenses and have a very good idea of the cash outlay each month. Goal for the cash is to draw down in 10 years $1,000 per month. I have not set a goal for the amount of cash I anticipate to need

You will get better advice on investing the $300,000 if we have a complete picture of your finances.
Will SS cover your expenses? Will you be working at something else? How about your wife? I am worried you will runout of money. You really should figure out your expenses. (Fixed and those that can be cut).

A note here: You don’t have a big pot of money. At a 4% withdrawl rate you can expect. 12k per year. An SPIA might be a good purchase. 300k would generate 1500 a month for life without any cost of living adjustments. You should learn more about this type of investment and see what you think.

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NewTimes
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Re: Abundance came late, now I'm overwhelmed playing catch up

Post by NewTimes » Thu Jul 12, 2018 5:03 pm

delamer wrote:
Thu Jul 12, 2018 3:14 pm
NewTimes wrote:
Thu Jul 12, 2018 2:54 pm
delamer wrote:
Thu Jul 12, 2018 2:30 pm
In addition to the $300,000 cash plus the SEP, do you have any other liquid assets?
None liquid but two small real estate parcels

You mentioned real estate — do you own any property that is producing income?
non income producing, a vacant commercial lot and a recreational river front lot

Are you currently working or collecting Social Security?
I have one client who I expect to conclude working with this year. I begin to collect SS in April 2019

Lastly, do you know your expenses going forward? Do you have a goal for the cash?
I have budgeted my expenses and have a very good idea of the cash outlay each month. Goal for the cash is to draw down in 10 years $1,000 per month. I have not set a goal for the amount of cash I anticipate to need

You will get better advice on investing the $300,000 if we have a complete picture of your finances.
So you want to take $1,000/month from the current $300,000, beginning in 10 years? And you would take that amount for the rest of your life? Is that $1,000 in 2018 dollars or in 2028 dollars?
My projection is that beginning in April of 2019 I will begin with SS. Income from owner financing and wife's SS with my SS will exceed my then expenses. So the $1,000 draw down is a projection beginning in 2028. There are no children so here is where I will quote my brother, "I want the last check to the undertaker to bounce". No heirs required to provide for in our estate.

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NewTimes
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Re: Abundance came late, now I'm overwhelmed playing catch up

Post by NewTimes » Thu Jul 12, 2018 5:10 pm

Dottie57 wrote:
Thu Jul 12, 2018 3:16 pm
NewTimes wrote:
Thu Jul 12, 2018 2:54 pm
delamer wrote:
Thu Jul 12, 2018 2:30 pm
In addition to the $300,000 cash plus the SEP, do you have any other liquid assets?
None liquid but two small real estate parcels

You mentioned real estate — do you own any property that is producing income?
non income producing, a vacant commercial lot and a recreational river front lot

Are you currently working or collecting Social Security?
I have one client who I expect to conclude working with this year. I begin to collect SS in April 2019

Lastly, do you know your expenses going forward? Do you have a goal for the cash?
I have budgeted my expenses and have a very good idea of the cash outlay each month. Goal for the cash is to draw down in 10 years $1,000 per month. I have not set a goal for the amount of cash I anticipate to need

You will get better advice on investing the $300,000 if we have a complete picture of your finances.
Will SS cover your expenses? Will you be working at something else? How about your wife? I am worried you will runout of money. You really should figure out your expenses. (Fixed and those that can be cut).

A note here: You don’t have a big pot of money. At a 4% withdrawl rate you can expect. 12k per year. An SPIA might be a good purchase. 300k would generate 1500 a month for life without any cost of living adjustments. You should learn more about this type of investment and see what you think.
I'll repeat the answer to the SS question you posed. Beginning April 2019, my and my wife's SS plus owner financing of my business will cover our monthly expenses. I do not expect to have to raid the CDs or future investments. I also have equity in other properties that I own that will eventually be sold (one by the US Gov't who needs the property for road expansion), the other a commercial lot. And my wife's mom is in failing health and there have been conversations with the family who wants to acquire my wife's interest in the farm (owner financing again). So there are other future income sources. If a SPIA is an annuity I have explored that option and feel I can do better.

delamer
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Re: Abundance came late, now I'm overwhelmed playing catch up

Post by delamer » Thu Jul 12, 2018 5:50 pm

NewTimes wrote:
Thu Jul 12, 2018 5:03 pm
delamer wrote:
Thu Jul 12, 2018 3:14 pm
NewTimes wrote:
Thu Jul 12, 2018 2:54 pm
delamer wrote:
Thu Jul 12, 2018 2:30 pm
In addition to the $300,000 cash plus the SEP, do you have any other liquid assets?
None liquid but two small real estate parcels

You mentioned real estate — do you own any property that is producing income?
non income producing, a vacant commercial lot and a recreational river front lot

Are you currently working or collecting Social Security?
I have one client who I expect to conclude working with this year. I begin to collect SS in April 2019

Lastly, do you know your expenses going forward? Do you have a goal for the cash?
I have budgeted my expenses and have a very good idea of the cash outlay each month. Goal for the cash is to draw down in 10 years $1,000 per month. I have not set a goal for the amount of cash I anticipate to need

You will get better advice on investing the $300,000 if we have a complete picture of your finances.
So you want to take $1,000/month from the current $300,000, beginning in 10 years? And you would take that amount for the rest of your life? Is that $1,000 in 2018 dollars or in 2028 dollars?
My projection is that beginning in April of 2019 I will begin with SS. Income from owner financing and wife's SS with my SS will exceed my then expenses. So the $1,000 draw down is a projection beginning in 2028. There are no children so here is where I will quote my brother, "I want the last check to the undertaker to bounce". No heirs required to provide for in our estate.

But how long do you want to draw down the $100,000 at $1,000 per month? For 5 years, for 10 years, for indefinitely?

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NewTimes
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Re: Abundance came late, now I'm overwhelmed playing catch up

Post by NewTimes » Thu Jul 12, 2018 6:16 pm

With $150K currently in CDs I can hope to generate 2-3% for a period of the 10 years. With the goal as my spouse becomes more comfortable with my investing knowledge to reallocate about $250k+ into funds. So in 10 years I hope to have the current $300k + CD interest (for what amount they are) and investment returns on the funds. If I was able to create 4% a year that would add to my existing $300k. As much as I dislike reverse mortgages from my personal experience, I may be a candidate for one in the future which would add substantially to the estate. I apologize for the lack of clarity as I am at times Googling terms on the forum to follow and participate in the conversation.

finite_difference
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Re: Abundance came late, now I'm overwhelmed playing catch up

Post by finite_difference » Thu Jul 12, 2018 7:16 pm

I would recommend an AA of at least 25% stocks. So if you are ultra-conservative, an AA of 25/75.

Have you considered delaying SS to 70? That’s an 8% return. How’s your health? The healthier you and your wife are, the more it makes sense to delay. But I am not a social security expert, but think about what the experts here have to say.
The most precious gift we can offer anyone is our attention. - Thich Nhat Hanh

RickBoglehead
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Re: Abundance came late, now I'm overwhelmed playing catch up

Post by RickBoglehead » Fri Jul 13, 2018 7:55 am

Owner financing would not be something I would undertake at your age, unless you can handle non-payment including foreclosure, both financially and emotionally (family).

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NewTimes
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Re: Abundance came late, now I'm overwhelmed playing catch up

Post by NewTimes » Fri Jul 13, 2018 8:50 am

finite_difference wrote:
Thu Jul 12, 2018 7:16 pm
I would recommend an AA of at least 25% stocks. So if you are ultra-conservative, an AA of 25/75.

Have you considered delaying SS to 70? That’s an 8% return. How’s your health? The healthier you and your wife are, the more it makes sense to delay. But I am not a social security expert, but think about what the experts here have to say.
As of this morning, I am leaning towards Vanguard Target Retirement 2015. The site list:
- Vanguard Total Bond Market II - 33.10%
- Vanguard Total Stock -------------23.70%
- Vanguard Total Int'l Stock -------16.10%
- Vanguard Total Int'l Bond --------14.20%
- Vanguard Short Term Inflation---11.90%

The %'s are Bond 47.3%, Stocks 39.80% and Inflation 11.90%. From what I have read this is a good ratio for someone my age and position in life.

I've learned the Target Funds change their balance ratios as the fund (and me) ages. As someone dipping their toe in the water this seems to be a safer action. The hope is as I learn more, to invest more in the market and less in CDs. And our financial decisions are in partnership with my best friend, my wife.

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NewTimes
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Re: Abundance came late, now I'm overwhelmed playing catch up

Post by NewTimes » Fri Jul 13, 2018 8:56 am

RickBoglehead wrote:
Fri Jul 13, 2018 7:55 am
Owner financing would not be something I would undertake at your age, unless you can handle non-payment including foreclosure, both financially and emotionally (family).
Actually the owner financing is the one option I am most comfortable with. In my past work history, I worked closely with attorneys assisting them in settling estates of an involuntary nature (foreclosures, special commissioner, conservator, trustee, POA), and on voluntary sales (contactural). It was a niche I created, mostly selling real estate at auction for clients of attorneys, the courts, banks, individuals and companies.

I can see where one would be leery to owner finance. I am much more leery of a landlord(owner)/tenant relationship than owner financing. Due to those problems, as I was the manager, caused me to sell my rental properties, with pleasure.

finite_difference
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Re: Abundance came late, now I'm overwhelmed playing catch up

Post by finite_difference » Sat Jul 14, 2018 9:56 am

NewTimes wrote:
Fri Jul 13, 2018 8:50 am
finite_difference wrote:
Thu Jul 12, 2018 7:16 pm
I would recommend an AA of at least 25% stocks. So if you are ultra-conservative, an AA of 25/75.

Have you considered delaying SS to 70? That’s an 8% return. How’s your health? The healthier you and your wife are, the more it makes sense to delay. But I am not a social security expert, but think about what the experts here have to say.
As of this morning, I am leaning towards Vanguard Target Retirement 2015. The site list:
- Vanguard Total Bond Market II - 33.10%
- Vanguard Total Stock -------------23.70%
- Vanguard Total Int'l Stock -------16.10%
- Vanguard Total Int'l Bond --------14.20%
- Vanguard Short Term Inflation---11.90%

The %'s are Bond 47.3%, Stocks 39.80% and Inflation 11.90%. From what I have read this is a good ratio for someone my age and position in life.

I've learned the Target Funds change their balance ratios as the fund (and me) ages. As someone dipping their toe in the water this seems to be a safer action. The hope is as I learn more, to invest more in the market and less in CDs. And our financial decisions are in partnership with my best friend, my wife.
Yes, that makes sense and nothing wrong with target date funds as long as you are aware of the approximate AA. However, if you’re talking about a taxable account (not 401k or IRA) then it will be more tax efficient to own the underlying funds themselves.
The most precious gift we can offer anyone is our attention. - Thich Nhat Hanh

dharrythomas
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Re: Abundance came late, now I'm overwhelmed playing catch up

Post by dharrythomas » Sat Jul 14, 2018 1:17 pm

Since this is taxable money, Tax Managed Balanced Fund is worth looking at 49/51 with US large cap and municipal bonds.

With $200K in CDs and then the income produced from your owner financed sales being "bond-like", even with 50% stock, you are still at somewhere under 15% stock overall.

I don't think you're playing catchup, because it doesn't look to me like you are behind, except maybe in your understanding of stock investing. It sounds like you've done well with real estate. What you described in cash will meet your needs, then you discussed other properties you have that will produce additional income or capital.

You have done well my friend, enjoy your retirement.

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NewTimes
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Re: Abundance came late, now I'm overwhelmed playing catch up

Post by NewTimes » Sun Jul 15, 2018 8:38 am

I decided to check out VG Target Retirement 2020 and compare it to 2015 since I'm in the middle. The 2020 is a little more aggressive.

I also wanted to put my toe in the water with a Robo. Am leaning towards Schwab Intelligent Investor. For $5k, I get a rep who can provide me some recommendations and explain the nuances of the funds. Then I checked into CS Target 2020 Index Fund. It's much younger than VG's and only has 2 years of existence.

The CS fee states Gross Expense Ratio (before waivers) is .13%, Net Expense Ratio (after waivers) is .08. VG states their Expense is .13 for both. Am I to assume that their are some discounts within the CS fund that reduce the fee to .08?

And lastly, have been reading lots about the choice of Fidelity-VG-or CS and all seem to have their supporters.

Is my plan to go with CS Robo for $5k and a 2020 plan (leaning toward CD) for an initial $25k wise or conflicting? Thanks for the replies.

Olemiss540
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Re: Abundance came late, now I'm overwhelmed playing catch up

Post by Olemiss540 » Sun Jul 15, 2018 9:05 am

SLOW DOWN! STOP! DON'T JUST DO SOMETHING, STAND THERE!

You have accumulated 300k over your life. Congrats. What you do over the next 3-6 months will make ZERO appreciable difference in the outcome, so I STRONGLY recommend you sit in cash/CDs for the next 6 months while you educate yourself and your spouse on investing.

Continue to read. This forum is a wealth of knowledge and there is not a new question that hasn't been posted. There are mounds of suggested reading in the WIKI. Continue to plan and communicate with your SO on your plans for retirement and projected spending/savings.

Your long term self can be seriously impacted and there has been a longstanding bull run you "might" be on the tail end of. Your SO was severely damaged the last time you lost 25k, what if you rush into a decision and lose 50k in a month without having a deep understanding of investing and the dedication to ride out downturns?
I hold index funds because I do not overestimate my ability to pick stocks OR stock pickers.

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whodidntante
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Re: Abundance came late, now I'm overwhelmed playing catch up

Post by whodidntante » Sun Jul 15, 2018 10:34 am

Apparently risk aversion runs in my family but didn't rub off on me. My grandmother never owned stocks in her life, and kept her money in CDs at the local bank. My mother and father have annuities and CDs and probably too much cash, but my father is at least skilled at finding competitive rates. He complained about the fluctuations in his Treasury bond fund and he probably sold it.

You do not need stocks to retire or to be retired, but you are probably better off with some. The family members I told you about missed out on some nice gains and nice tax benefits by avoiding stocks.

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NewTimes
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Re: Abundance came late, now I'm overwhelmed playing catch up

Post by NewTimes » Sun Jul 15, 2018 4:23 pm

Olemiss540 wrote:
Sun Jul 15, 2018 9:05 am
SLOW DOWN! STOP! DON'T JUST DO SOMETHING, STAND THERE!

You have accumulated 300k over your life. Congrats. What you do over the next 3-6 months will make ZERO appreciable difference in the outcome, so I STRONGLY recommend you sit in cash/CDs for the next 6 months while you educate yourself and your spouse on investing.

Continue to read. This forum is a wealth of knowledge and there is not a new question that hasn't been posted. There are mounds of suggested reading in the WIKI. Continue to plan and communicate with your SO on your plans for retirement and projected spending/savings.

Your long term self can be seriously impacted and there has been a longstanding bull run you "might" be on the tail end of. Your SO was severely damaged the last time you lost 25k, what if you rush into a decision and lose 50k in a month without having a deep understanding of investing and the dedication to ride out downturns?
I appreciate the words of caution and to move slowly. I have immersed myself in the fundamentals. I realize I am in the ocean with a rubber raft that leaks without a paddle. I am swimming with sharks. As a former real estate broker, I had real estate opportunities I knew about because I was in the business that others did not. I also had online tools others didn't that gave me an advantage and had contacts within the industry for help when needed. I'm in another guys ball field today without a ball or glove.

My newness showed in an earlier post when I was comparing a Shaub ETF fund to a VG Mutual Fund.

I get and agree with the adage it's better to do nothing when one is unsure what to do. Let me share my thought and I invite you and others to agree or disagree. The Schwab Intelligent Portfolio only requires $5k. I completed the questionnaire and reviewed it's recommendations. I've also read and printed the Prospectus of VG Target Retirement 2020 this morning. I was contemplating placing $25K in that fund. Purchasing two Roth IRAs for myself and wife ($6,500 x 2). That comes to about $43k of the $300,000 that I want to invest or 14.3% with the remainder being in CD's.

The cash has been sitting in a savings getting 1/10th of 1% interest. Other than the speed that you mention, is there another weak link(s) you see in my plan? Thanks.

bampf
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Re: Abundance came late, now I'm overwhelmed playing catch up

Post by bampf » Sun Jul 15, 2018 5:14 pm

NewTimes wrote:
Sun Jul 15, 2018 4:23 pm
The cash has been sitting in a savings getting 1/10th of 1% interest. Other than the speed that you mention, is there another weak link(s) you see in my plan? Thanks.
I am not really sure what you are trying to accomplish. You say "only $5K" and then go on to complain about the interest. Let's try it this way... If your robo fund is a phenomenal success and hits a home run with a 20% return, are you super happy? I mean a grand is a grand and all that, but, does it change your life? What if it does nothing except generate money for your borker? (It should be broker, but borker seems more appropriate..). How about this... This forum represents a ton of wealth, way more than $300K. Most of the folks here have a lot of experience deciding these sorts of things at much higher levels of income. My suggestion would be that you slow down, listen to what these folks are suggesting before you go invest in a robo fund... 3 months wont matter at all. You should really really understand simplicity and three fund portfolios and so forth. It seems a bridge too far to go from sitting on cash to robo advisers in one breath. Anyway, my 2 cents....

Olemiss540
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Re: Abundance came late, now I'm overwhelmed playing catch up

Post by Olemiss540 » Sun Jul 15, 2018 5:20 pm

NewTimes wrote:
Sun Jul 15, 2018 4:23 pm
Olemiss540 wrote:
Sun Jul 15, 2018 9:05 am
SLOW DOWN! STOP! DON'T JUST DO SOMETHING, STAND THERE!

You have accumulated 300k over your life. Congrats. What you do over the next 3-6 months will make ZERO appreciable difference in the outcome, so I STRONGLY recommend you sit in cash/CDs for the next 6 months while you educate yourself and your spouse on investing.

Continue to read. This forum is a wealth of knowledge and there is not a new question that hasn't been posted. There are mounds of suggested reading in the WIKI. Continue to plan and communicate with your SO on your plans for retirement and projected spending/savings.

Your long term self can be seriously impacted and there has been a longstanding bull run you "might" be on the tail end of. Your SO was severely damaged the last time you lost 25k, what if you rush into a decision and lose 50k in a month without having a deep understanding of investing and the dedication to ride out downturns?
I appreciate the words of caution and to move slowly. I have immersed myself in the fundamentals. I realize I am in the ocean with a rubber raft that leaks without a paddle. I am swimming with sharks. As a former real estate broker, I had real estate opportunities I knew about because I was in the business that others did not. I also had online tools others didn't that gave me an advantage and had contacts within the industry for help when needed. I'm in another guys ball field today without a ball or glove.

My newness showed in an earlier post when I was comparing a Shaub ETF fund to a VG Mutual Fund.

I get and agree with the adage it's better to do nothing when one is unsure what to do. Let me share my thought and I invite you and others to agree or disagree. The Schwab Intelligent Portfolio only requires $5k. I completed the questionnaire and reviewed it's recommendations. I've also read and printed the Prospectus of VG Target Retirement 2020 this morning. I was contemplating placing $25K in that fund. Purchasing two Roth IRAs for myself and wife ($6,500 x 2). That comes to about $43k of the $300,000 that I want to invest or 14.3% with the remainder being in CD's.

The cash has been sitting in a savings getting 1/10th of 1% interest. Other than the speed that you mention, is there another weak link(s) you see in my plan? Thanks.
Personally, I would recommend a 3 fund portfolio as I have read of tax concerns/issues once you are entangled in robo investments and want to take a different approach. I prefer a basic 3 fund portfolio, using total stock/total international/and total bond (or municipal bonds depending on if you are in the 24% or higher tax bracket). Simple and low tax drag.

This is SIMPLE to do, and pretty well set it and forget it. The concern is if your resolve is tested right away with a large market correction or your bond allocation drops and you want to react to these issue by selling your position. With a better understanding of the reasons driving price fluctuations, you would be more equipped to stand your ground.

The worst decision you can make is to sell when something is down. The second worst decision is to think you are smarter than anyone else and realize there is always someone on the other end of every transaction you make..

Just be patient. 3 months reading this forum and you will KNOW why and what you are buying which makes it MUCH easier to ride out the trough.
I hold index funds because I do not overestimate my ability to pick stocks OR stock pickers.

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NewTimes
Posts: 19
Joined: Thu Jul 12, 2018 5:10 am

Re: Abundance came late, now I'm overwhelmed playing catch up

Post by NewTimes » Sun Jul 15, 2018 6:40 pm

Olemiss540 wrote:
Sun Jul 15, 2018 5:20 pm
NewTimes wrote:
Sun Jul 15, 2018 4:23 pm
Olemiss540 wrote:
Sun Jul 15, 2018 9:05 am
SLOW DOWN! STOP! DON'T JUST DO SOMETHING, STAND THERE!

You have accumulated 300k over your life. Congrats. What you do over the next 3-6 months will make ZERO appreciable difference in the outcome, so I STRONGLY recommend you sit in cash/CDs for the next 6 months while you educate yourself and your spouse on investing.

Continue to read. This forum is a wealth of knowledge and there is not a new question that hasn't been posted. There are mounds of suggested reading in the WIKI. Continue to plan and communicate with your SO on your plans for retirement and projected spending/savings.

Your long term self can be seriously impacted and there has been a longstanding bull run you "might" be on the tail end of. Your SO was severely damaged the last time you lost 25k, what if you rush into a decision and lose 50k in a month without having a deep understanding of investing and the dedication to ride out downturns?
I appreciate the words of caution and to move slowly. I have immersed myself in the fundamentals. I realize I am in the ocean with a rubber raft that leaks without a paddle. I am swimming with sharks. As a former real estate broker, I had real estate opportunities I knew about because I was in the business that others did not. I also had online tools others didn't that gave me an advantage and had contacts within the industry for help when needed. I'm in another guys ball field today without a ball or glove.

My newness showed in an earlier post when I was comparing a Shaub ETF fund to a VG Mutual Fund.

I get and agree with the adage it's better to do nothing when one is unsure what to do. Let me share my thought and I invite you and others to agree or disagree. The Schwab Intelligent Portfolio only requires $5k. I completed the questionnaire and reviewed it's recommendations. I've also read and printed the Prospectus of VG Target Retirement 2020 this morning. I was contemplating placing $25K in that fund. Purchasing two Roth IRAs for myself and wife ($6,500 x 2). That comes to about $43k of the $300,000 that I want to invest or 14.3% with the remainder being in CD's.

The cash has been sitting in a savings getting 1/10th of 1% interest. Other than the speed that you mention, is there another weak link(s) you see in my plan? Thanks.
Personally, I would recommend a 3 fund portfolio as I have read of tax concerns/issues once you are entangled in robo investments and want to take a different approach. I prefer a basic 3 fund portfolio, using total stock/total international/and total bond (or municipal bonds depending on if you are in the 24% or higher tax bracket). Simple and low tax drag.
I would like to do the 3 fund portfolio. But I am ill equipped to know the process of when and how to rebalance. That likely seems unbelievable here but it's the truth. I am only planning to buy and add to the account for 10 +/- years. The appeal of Schwab is they have local offices and have given me more time and answered my questions. In my conversations with VG I've been told on 3 occasions that they cannot recommend buys. It's up to me. As humbling as this is to say. I need hand holding here
This is SIMPLE to do, and pretty well set it and forget it. The concern is if your resolve is tested right away with a large market correction or your bond allocation drops and you want to react to these issue by selling your position. With a better understanding of the reasons driving price fluctuations, you would be more equipped to stand your ground.
I am only planning to purchase and stay the course, with down turns in the market
The worst decision you can make is to sell when something is down. The second worst decision is to think you are smarter than anyone else and realize there is always someone on the other end of every transaction you make..

Just be patient. 3 months reading this forum and you will KNOW why and what you are buying which makes it MUCH easier to ride out the trough.

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market timer
Posts: 5967
Joined: Tue Aug 21, 2007 1:42 am

Re: Abundance came late, now I'm overwhelmed playing catch up

Post by market timer » Sun Jul 15, 2018 8:12 pm

With no desire to leave an inheritance and low risk tolerance, you sound like the perfect candidate for an annuity.

BogleBike
Posts: 52
Joined: Wed Jun 27, 2018 2:26 pm

Re: Abundance came late, now I'm overwhelmed playing catch up

Post by BogleBike » Sun Jul 15, 2018 8:52 pm

20+ years stock investor, real estate owner, landlord.

Personal opinion:

Robo funds are not worthwhile for most investors, don't waste your time with one. It's a complexity that won't add value in any ways that are relevant to your case.

A little bit of stock (about like you're planning) is reasonable, but ONLY if you're wife is comfortable with it, and only if BOTH of you are comfortable calmly holding the stock when the stock market plunges. Which it will do before your story ends!

I suspect that above conditions aren't going to happen, so you're safer sticking with bonds and real estate. Buy your limit of Series I Treasury bonds every year.
https://www.thebalance.com/series-i-sav ... ide-357555
https://www.treasurydirect.gov/indiv/pr ... glance.htm

Put the rest in CDs, perhaps at Vanguard; or a general bond fund at Vanguard, such as VBIIX; or TIPS, which are bonds that are inflation protected, and can be bought in larger quantities than the Series I Treasury bonds. Vanguard's TIPS fund is called VIPSX, I believe.
https://investor.vanguard.com/mutual-fu ... file/VBIIX
https://investor.vanguard.com/mutual-fu ... file/VIPSX

The above suggestions are fairly low risk moves, in that they increase your return compared to to cash, yet most of them are easy to reverse. Also, they should preserve most of your capital under almost all conditions. In other words, they are better than cash but less risky than stocks, especially if your wife's worries could trigger a stock sale in a downturn.

The suggestions to keep learning about stocks are very good. The comments you make show you've been reading. But (please don't be offended!!) they seem to bounce around between various options without a clear plan, which suggests that it would be hard to predict your future actions. The biggest risk in stocks is changing your mind later after they fall, which is a guaranteed loss. It's also incredibly normal, and the exact thing that your wife already experienced. Better to learn more before putting your money at risk IMHO.

Remember, the extra properties you own are a backup. You have skill in that area so maybe you could sell those if you had a time of need.

PS. Congratulations on pulling off the wins in your career, and making money in your niche. It sounds like you are positioned for an enjoyable retirement. You did it!

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NewTimes
Posts: 19
Joined: Thu Jul 12, 2018 5:10 am

Re: Abundance came late, now I'm overwhelmed playing catch up

Post by NewTimes » Mon Jul 16, 2018 2:11 pm

BogleBike wrote:
Sun Jul 15, 2018 8:52 pm
20+ years stock investor, real estate owner, landlord.

Personal opinion:

Robo funds are not worthwhile for most investors, don't waste your time with one. It's a complexity that won't add value in any ways that are relevant to your case.

A little bit of stock (about like you're planning) is reasonable, but ONLY if you're wife is comfortable with it, and only if BOTH of you are comfortable calmly holding the stock when the stock market plunges. Which it will do before your story ends!

I suspect that above conditions aren't going to happen, so you're safer sticking with bonds and real estate. Buy your limit of Series I Treasury bonds every year.
https://www.thebalance.com/series-i-sav ... ide-357555
https://www.treasurydirect.gov/indiv/pr ... glance.htm

Put the rest in CDs, perhaps at Vanguard; or a general bond fund at Vanguard, such as VBIIX; or TIPS, which are bonds that are inflation protected, and can be bought in larger quantities than the Series I Treasury bonds. Vanguard's TIPS fund is called VIPSX, I believe.
https://investor.vanguard.com/mutual-fu ... file/VBIIX
https://investor.vanguard.com/mutual-fu ... file/VIPSX

The above suggestions are fairly low risk moves, in that they increase your return compared to to cash, yet most of them are easy to reverse. Also, they should preserve most of your capital under almost all conditions. In other words, they are better than cash but less risky than stocks, especially if your wife's worries could trigger a stock sale in a downturn.

The suggestions to keep learning about stocks are very good. The comments you make show you've been reading. But (please don't be offended!!) they seem to bounce around between various options without a clear plan, which suggests that it would be hard to predict your future actions. The biggest risk in stocks is changing your mind later after they fall, which is a guaranteed loss. It's also incredibly normal, and the exact thing that your wife already experienced. Better to learn more before putting your money at risk IMHO.

Remember, the extra properties you own are a backup. You have skill in that area so maybe you could sell those if you had a time of need.

PS. Congratulations on pulling off the wins in your career, and making money in your niche. It sounds like you are positioned for an enjoyable retirement. You did it!
Thanks for the kind and supportive words BB. I very much appreciate ALL the comments made here. I have read many threads on this forum and have gotten many good ideas. I viewed the info on the links you provided and it appears the VIPSX fund is more valid for me rather than buying direct. I am surprised that no one so far has supported one of the Retirement Target Funds. Most everyone has support a 3+ fund portfolio.

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