Smart use of $400k home sale proceeds we don’t need for retirement center we’re moving to

[ridingatrain]

We are soon selling our home and moving to an independent living apartment at a continuing care retirement center. We do not need the proceeds to pay the entrance fee. We have a typical 60/40 portfolio with an investment advisor, and of course we’ll be asking for their advice too. But since their fees are based on aum, their advice may be a little like asking my barber if I need a haircut.

So let’s say we’d like to at least consider holding back at least some of the roughly $400k we might get when we sell, and use some of it in something like maybe a CD ladder to raise some interest income to help defray the monthly rental once we move.

I’d like thoughts, ideas, etc., on the whole subject of what to do with the big chunk we’ll get in a couple more this.

I should add we are both nearly 80, we both have good LTCI, and our current portfolio without the house sale is a bit over $1 million, so the $400k is a fairly substantial fraction of the new total.

[FinanceDoctor]

Others will chime in with more substantive answers.

However, if you question how your advisor will advise you regarding 28% of your investment holdings, I think it raises questions regarding whether you should be trusting them with the other 72%.

[soretired]

Since you don't need it open a Vanguard account and put the $400K into VTI, total stock market fund. Your kids will appreciate it.

[Parkinglotracer]

You should look at your portfolio holistically including your annual expenses, your risk tolerance, and your goals for your future, and goals for your estate. There is a format for portfolio reviews here in the forum. I’d say you are not doing your advisor, the crowd here, or yourself a fair opportunity by trying to ask for anyone to come up with advice with only a partial insight into what your situation is.

You could put it in VTI, or VXUS, or BND or you could buy a treasury bond ladder or vanguard’s mm fund which is paying above 5%. There are lots of options. The right mix will be an appropriate portfolio for you and your spouse. Let us know what the rest of your portfolio looks like and your risk tolerance, etc and maybe we can offer some suggestions.

[DCChak]

Also interested in more details and advice.

My recently widowed 82 year old mother is in a similar situation, though she has yet to commit to a specific assisted living facility. I'm in the process of liberating ~$460k in retirement accounts from her advisors, she has an additional ~$310k in a taxable account at Fidelity, and another ~$100k in local cash accounts. She has yet to sell the house, but will likely do so within the next year, and the valuation looks to be ~$400k. Her current expenses are covered by her pension and SS.

We've settled on 50% FSKAX (Total Market Equity Fund), filling the taxable account first, and then overflow to retirement), and some combination of FZDXX (Money Market - currently 5.11%) and FBND in the retirement accounts first for the fixed income portion. Have pondered creating a bond ladder, but not certain it's worth the time and effort.