What is your AA, given your age ? and this crisis ?

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cpan00b
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Re: What is your AA, given your age ? and this crisis ?

Post by cpan00b » Wed Mar 25, 2020 12:38 pm

Age 30, I'm 95/5 right now. Of the equities, I'm 75-25 between Total US Market and Total International. I've let this drift down from 70-30, so will probably buy some international when I get my paycheck to bring it back up.

The 5% not in equities is in Fidelity US Bond index. Also have about 6 months emergency fund which I am trying to grow right now to 1 year emergency fund given the economy.

Joe48
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Re: What is your AA, given your age ? and this crisis ?

Post by Joe48 » Wed Mar 25, 2020 4:46 pm

Age 71

My AA is 80 stocks and 20 bonds with 5 years expenses in cash. Currently, no mortgage or debt. Moving to 70/30 once this blows over. My stock portfolio contains only dividend stocks. I also have 2 pensions and Soc. Sec.

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PoultryMan
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Re: What is your AA, given your age ? and this crisis ?

Post by PoultryMan » Wed Mar 25, 2020 4:57 pm

Close to 52 and 55/35/10. Trying to get the courage to build up equities :confused

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confusedinvestor
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Re: What is your AA, given your age ? and this crisis ?

Post by confusedinvestor » Wed Mar 25, 2020 9:30 pm

I'm 45 as well and I do plan to retire at 55. My current AA 75:25 but I'm gliding to 55:45 when I'd retire.

I may take less risk (like AA 45:55) if I have enough when I'd retire in 10 yrs from now, depending on my savings rate, market returns, assuming I can keep my job.

This crash made my realize that if multiple crashes like this happen back to back when we would retire, and, withdrawing from our portfolio, we may run out of money when we will be 95.

No pension.
keystone wrote:
Wed Mar 18, 2020 9:18 am
1) My target allocation is 55-60% stocks at all times with the rest in bonds. I'm currently age 45 and feel comfortable with this allocation after experiencing two very significant downturns in my investing life. I've scaled back from working full-time this year and plan to be fully retired by 49.

2) This is a fixed allocation for me and I have no plans to make any adjustments to it as I age. I feel that this is a reasonable "forever" allocation.

3) I'm periodically monitoring my asset allocation to ensure that I remain invested in 55-60% stocks.

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grabiner
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Re: What is your AA, given your age ? and this crisis ?

Post by grabiner » Wed Mar 25, 2020 10:35 pm

Age 52, currently 88% stock, have been decreasing by 2% per year since I was 100% at age 46. And I overweight riskier stock, so even now, I probably have the risk of a 100% stock portfolio. (This used to be a net allocation, counting my mortgage as a negative bond, but I paid off almost all of the mortgage, so I am now 88% stock and 12% bonds in my investment portfolio. And one of the reasons I can be aggressive is that I own a nearly-paid-off condo.)

I rebalanced two weeks ago because my bond allocation went over the 15% limit, getting back to the 12% target.

I have long been one of the most aggressive investors on the Bogleheads forum, and I never recommend that anyone match my portfolio. If a portfolio like mine is right for you, then you know enough to ignore that advice.
Wiki David Grabiner

smectym
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Re: What is your AA, given your age ? and this crisis ?

Post by smectym » Thu Mar 26, 2020 12:25 am

dboeger1 wrote:
Mon Mar 16, 2020 2:49 am
Age 28, coming up on 29. 100% global cap weighted index fund (VTWAX), with no foreseeable glide path and minimal cash savings at this point.

Against my better Boglehead senses, I tried to time the market when this recent bear market started by investing a large portion of my emergency fund. That falling knife hurt! That alone would've been fine, but then I was hit by a much larger than expected tax bill and others due at about the same time, and there went my emergency fund. We were able to recover it pretty quickly with my wife's annual bonus that was due, but the worst part was becoming the market timer cliche I never wanted to become.

As scary as this all is, I'm a big believer in TINA (there is no alternative) at the moment. Stocks are just so much more attractive than other asset classes in a low interest environment in which governments seem to only know how to bail out industry. Bailouts and QE were controversial in the 2007-9 crisis; now, Jim Cramer demands them before the official end of the bull and nobody bats an eye because society is collectively leveraged to the hilt and dependent on corporate stability. It seems everything's too big to fail today.

So basically, unless we eventually see a return to "normal", I have no intention of changing my 100% global cap weighted stock portfolio. I don't even think I'll end up with a retirement glide path, maybe just save up some cash reserves before retirement. My intention is to accumulate a large enough portfolio to live off of dividends, or at the very least have a very conservative withdrawal rate. I'm fortunate enough to have both a decently high income and a low desire to spend it, so I can set such a goal. It may have to change when we decide to have kids, but I'll wait until that time to reevaluate.
dboeger1, in any crisis, cash is king.

Recommend you substantially increase your cash reserves—preferably forever, but since you’re such a “100% stock” gunslinger, at least until it turns out this crisis isn’t “THE” crisis

pascalwager
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Re: What is your AA, given your age ? and this crisis ?

Post by pascalwager » Thu Mar 26, 2020 12:42 am

1. What is your AA (Stock:Bond), given your age? and why?
2. How do you glide your risk (stock percentage) as you age and/or approach your 'need' portfolio value ?
3. Given the current market and health crisis, how do you 'stay the course' on your AA ?
Stocks/bonds, 55/45. Age 77.

I got into stocks (big lump sum) at age 53, so went pretty aggressive at 90/10. I heard Bill and Larry advising taking some off the table a few years ago, so I did a couple big stock reductions down to present 55/45.

My portfolio is/was fairly large and I have a pension (so far), so staying the course (rebalancing into stocks) has required only minimal courage recklessness. I have a 20% (of target) balancing band, so only one action so far.

hoping
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Re: What is your AA, given your age ? and this crisis ?

Post by hoping » Thu Mar 26, 2020 12:49 am

Age 72. Target allocation to stocks is 45% give or take 5%. Stocks currently at 37% with the downturn. I started slowly, on a monthly basis, rebalancing the other day to get back in range.

SJCX
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Re: What is your AA, given your age ? and this crisis ?

Post by SJCX » Thu Mar 26, 2020 4:35 am

Age 48

100% stocks(small % in Vanguard high yield corporate bond index)

Will get two pensions(wife) and two SS

Save/invest way above my spending

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Harry Livermore
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Re: What is your AA, given your age ? and this crisis ?

Post by Harry Livermore » Thu Mar 26, 2020 6:19 am

Age 53 (wife 50)
+/- 40% stock, 55% bond, 5% cash and PMs. I had felt in mid-2018 that the market was too richly valued, and figured we were due for a correction, so flipped what had been 55/40/5)
I shared a snapshot of the AA graph from my VG account in another thread. The "target" AA for people "in my age group" is 70/30 :shock:
We both have pensions (assuming they are there) and Social Security (complicated by wife being a teacher, as discussed in another thread)
We also have rental real estate.
So why not a more aggressive AA, since we have a "floor" of income in retirement? Sleep Well At Night. And this particular crisis, like no other, has made me appreciate SWAN. The one takeaway is that our EF (+/- 11 months, more if we stretch or use the HELOC a bit, even more if I use my "dry powder" at Etrade) really needs to be bigger. I had wanted to increase "cash" (MM/ FDIC/ CDs) for us by the time we retire (9-12 years from now) to the point where we'd have 5 years' expenses in the bank. This crisis will drain the EF by some undetermined amount, pushing back on that part of my plan. That is the part that spooks me, not our AA.
Also, part of the buildup of cash now, was to allow us to feel more comfortable slowly rebalancing a bit more into equities ("rising glide path" Kitches/Pfau approach) until we're closer to 50/50 when starting SS. Really not planning a big move there.
Sorry, that answer was probably longer than expected.

TL/DR: Age 53, 40 stock /55 bond/ 5 other

Cheers

dcabler
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Re: What is your AA, given your age ? and this crisis ?

Post by dcabler » Thu Mar 26, 2020 6:21 am

Age: 59
60/40 before the crisis
60/40 during the crisis
60/40 after the crisis is over
With drift of course between rebalancing

hudson
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Re: What is your AA, given your age ? and this crisis ?

Post by hudson » Thu Mar 26, 2020 6:41 am

Age: 72
00/100 before, during, and after
I got out of equities in 2008 and never went back
10/90 VWIUX/CDs mostly (VWIUX = Vanguard Intermediate-Term Tax-Exempt Fund)

If a 3%+ CD comes along, I'll probably go to 05/95 VWIUX/CD...depending on capital gains or losses.
I'm also considering exchanging VWIUX for the Vanguard Inflation-Protected Securities Fund .
I keep the 10% in a fund to cover cash needs.
I am not using a CD ladder as I didn't want to lose any interest. At the present, I'm stuck on 5 year CDs. I will likely move to a CD ladder when the CDs expire.

vested1
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Re: What is your AA, given your age ? and this crisis ?

Post by vested1 » Thu Mar 26, 2020 7:03 am

Nearly 68, 0/0 all cash. Got out when we were 14% down from 2019 year end portfolio balance, 3 fund 60/40. We will get back in when a vaccine is announced with 60/40 AA. No need currently to withdraw savings, with enough fixed income to meet expenses. Even more fixed income when I file for SS at age 70 in two years. More than enough income now that restaurants are closed. Enough cash to withdraw 4% until at least age 100. I (we) are at high risk of getting the virus and dying from it, and wish to preserve the balance for our kids. No bills except utilities, TV etc.

I advised my daughter to stay the course, at age 37 and 100% stock, all index at VG.

A close family member, age 70 is 70/30 in 60 individual stocks, managed by an advisor, and is riding it out. At the beginning of the crisis he had 38% more in his portfolio. We are likely about even now. He thinks I'm crazy. Some of you do too. :beer
Last edited by vested1 on Thu Mar 26, 2020 8:53 am, edited 3 times in total.

hudson
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Re: What is your AA, given your age ? and this crisis ?

Post by hudson » Thu Mar 26, 2020 7:04 am

grabiner wrote:
Wed Mar 25, 2020 10:35 pm
And one of the reasons I can be aggressive is that I own a nearly-paid-off condo.)

bond allocation went over the 15% limit, getting back to the 12% target.

I have long been one of the most aggressive investors on the Bogleheads forum, and I never recommend that anyone match my portfolio. If a portfolio like mine is right for you, then you know enough to ignore that advice.
No debt is power...but you already knew.
88% equities....that would give me heart failure, but a majority of my cohorts are with you.
I'll take your recommendation and remain a reserved investor.

hudson
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Re: What is your AA, given your age ? and this crisis ?

Post by hudson » Thu Mar 26, 2020 7:13 am

vested1 wrote:
Thu Mar 26, 2020 7:03 am
Nearly 68, 0/0 all cash.

No bills except utilities, TV etc.

He thinks I'm crazy. Some of you do too. :beer
0/0 all cash. I would call that 0/100..what's not to like. I personally would not go back to equities. You've probably already read Bernstein's Ages of the Investor? https://www.amazon.com/Ages-Investor-Cr ... B008CM2T2A
No debt = YES!
Crazy? like a fox

dboeger1
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Re: What is your AA, given your age ? and this crisis ?

Post by dboeger1 » Thu Mar 26, 2020 7:29 pm

smectym wrote:
Thu Mar 26, 2020 12:25 am
dboeger1 wrote:
Mon Mar 16, 2020 2:49 am
Age 28, coming up on 29. 100% global cap weighted index fund (VTWAX), with no foreseeable glide path and minimal cash savings at this point.

Against my better Boglehead senses, I tried to time the market when this recent bear market started by investing a large portion of my emergency fund. That falling knife hurt! That alone would've been fine, but then I was hit by a much larger than expected tax bill and others due at about the same time, and there went my emergency fund. We were able to recover it pretty quickly with my wife's annual bonus that was due, but the worst part was becoming the market timer cliche I never wanted to become.

As scary as this all is, I'm a big believer in TINA (there is no alternative) at the moment. Stocks are just so much more attractive than other asset classes in a low interest environment in which governments seem to only know how to bail out industry. Bailouts and QE were controversial in the 2007-9 crisis; now, Jim Cramer demands them before the official end of the bull and nobody bats an eye because society is collectively leveraged to the hilt and dependent on corporate stability. It seems everything's too big to fail today.

So basically, unless we eventually see a return to "normal", I have no intention of changing my 100% global cap weighted stock portfolio. I don't even think I'll end up with a retirement glide path, maybe just save up some cash reserves before retirement. My intention is to accumulate a large enough portfolio to live off of dividends, or at the very least have a very conservative withdrawal rate. I'm fortunate enough to have both a decently high income and a low desire to spend it, so I can set such a goal. It may have to change when we decide to have kids, but I'll wait until that time to reevaluate.
dboeger1, in any crisis, cash is king.

Recommend you substantially increase your cash reserves—preferably forever, but since you’re such a “100% stock” gunslinger, at least until it turns out this crisis isn’t “THE” crisis
Cash is only necessary to the extent you need to spend it. I'm prepared to significantly reduce my expenses to survive, and I stay completely debt-free and have few obligations. I also have several backup options like living with family, borrowing money, or doing side jobs for extra income. Heck, I even have experience and supplies when it comes to camping in the wilderness with minimal modern luxuries for extended periods of time. I also have fairly in-demand and marketable skills. But long before it even came to that point, I suppose I could just sell stocks at a loss to feed and shelter myself, which I don't want to do but I accept as part of the risks of not holding much in cash or bonds. I even have substantial physical possessions which could be sold for good amounts of money to get through a crisis. So all in all, it'd have to be a really severe crisis for me not to be able to handle it. Of course, this is a very different story than for someone who has a big mortgage and children they can't see living any other way. Not that those people can't adapt or do the things I said, but they may not have the same level of tolerance or preparedness as I do, so they may only feel secure with more of a cash buffer. I could see how someone would want to do everything in power if they felt losing their kid's tuition or the ability to pay for their medical care would turn their world upside down. But being somewhat of a minimalist for an extended period of time has afforded me the flexibility to really prioritize long-term returns.

lowndes
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Re: What is your AA, given your age ? and this crisis ?

Post by lowndes » Thu Mar 26, 2020 7:38 pm

35 - 90/10

thibaulthib
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Re: What is your AA, given your age ? and this crisis ?

Post by thibaulthib » Thu Mar 26, 2020 9:19 pm

30yo, my strategy was my age - 10, meaning 80/20.

Was 80/20 before this 30% market decline.
I have now rebalanced to 85/15, so age - 15.

I still want to keep 15% in bonds as I only have 2 months of EF. I've got a stable job, even during this tough moment. So I still need some sort of cash aside somehow (be it in bonds or EF) that will do the trick shall some new crash are showing up, or if the decline is not over.

Also, all my pay checks go directly into the market, and I don't have any loans/debts/mortgages.

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VeganBH
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Re: What is your AA, given your age ? and this crisis ?

Post by VeganBH » Sat Mar 28, 2020 5:07 pm

DH & I are both 51.
He took early retirement package in Feb (before the crisis) at MegaCorp. :|
Before downturn: 25:75 (Stocks:Fixed [CDs, MM, Bonds])
After the 2-3 days bump last week: 15:85 - we sold some old, costly MFs, and plan to replace with VTSAX at some point in future.

Ultimately, we may get back to 25-35 stocks, once things are a bit less murky. We really don't need to take any risk, and we are reminded once again, that we don't have the stomachs for it.
No debt. No heirs/legacy needed.

We have ~45-55x our living expenses (and could live 100% off pension/SS if need be when 65/70).

Good luck.
"Until we extend our circle of compassion to all living things, humanity will not find peace."​ ~ Albert Sc​hweitzer

GrayingSlowly
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Re: What is your AA, given your age ? and this crisis ?

Post by GrayingSlowly » Sat Mar 28, 2020 7:28 pm

Folks,

1. What is your AA (Stock:Bond), given your age? and why?

I’m 65 and my AA is currently at 60/40 (stock/bond index funds). My total portfolio is in the low $3M and I have a pension and social security to supplement by bond index fund holdings so the 40% in bonds gives me 10+ years of living expenses without needing to touch the stock portion of the portfolio before then. This seems reasonably safe, but of course if the US/world economy totally crashes around me, I may reevaluate. :-)

2. How do you glide your risk (stock percentage) as you age and/or approach your 'need' portfolio value ?

My AA up to age 60 was 100/0 (100% stock index funds). From age 60 to now I gradually shifted to around 60/40. I’m planning to leave my portfolio holdings unchanged (no re-balancing) and let it ride until RMD kicks in and likely after that.

3. Given the current market and health crisis, how do you 'stay the course' on your AA ?

Be like a deer in headlights. Don’t move (don’t trade) regardless of apparent danger. It’s as simple as that.
Last edited by GrayingSlowly on Sat Mar 28, 2020 8:37 pm, edited 1 time in total.

jw2s
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Re: What is your AA, given your age ? and this crisis ?

Post by jw2s » Sat Mar 28, 2020 8:36 pm

1) 38yrs old. 80/20. Age-10 in bonds, but I guess I don't want to be too conservative since I have a long investment horizon so I made it 80/20.

2) I had no plan on gliding anything. 80/20 til later? Maybe at 45 or 50 start thinking about it. Or now, tonight.

3) I rebalanced when portfolio went 75/25. First time ever. I refuse to sell anything. I'm also not that savvy and would probably royally F something up, causing myself a major tax implication or penalty of some sort. Automatic deposit from paycheck. I don't touch it.
First bear market. I just started my career in 08' so I had chump change invested. I realized during this I like risk and don't mind seeing my numbers drop precipitously. All future contributions are 100% equities now until I don't know yet. I don't have a written ISP. I'm a work in progress I suppose.

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