- 1. How much is healthcare going to cost me pre-Medicare?
- 2. When do I start getting more conservative with my AA, especially towards equities?
I've seen plenty of threads and articles about sequence of returns risk. To wit, I've recently started moving my allocation from 70/30 to 60/40 and I'm a little more than halfway there now. If my wife had her way, I'd be retired now since she's convinced my job is killing me (she's probably right). I am of the mind we're more likely to retire in 4-5 more years because I need my current, excellent healthcare and I feel like we need more of a buffer. From a planning perspective, my current holdings would give me a 4% SWR which easily pays all of my required and discretionary spending. I'd like that to be closer to a 3.5% SWR for the added safety and buffer. We can easily cut our spending by 20% if we need to and not be disappointed.
This creates a bit of a paradox as I need/want the security of a higher bond allocation to reduce overall risk as we inch closer to retirement but I need (or feel I need) the higher risk/return potential of the extra equity holdings. When is a good time to consider taking that additional risk off the table and simply stock piling additional fixed income/cash? Now? In another couple years? Should I even be considering a move to 50/50?
Neither of us plan to live much past our late 70s, early 80s (based on our family history) so I've been planning a 40yr retirement at the long end. We dont have kids nor a desire to leave a legacy. I also dont have a desire to die eating cat food, so I'm trying to be well planned without looking for too perfect a plan. Any advice is appreciated.