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|Subject: Re: Asset Allocation||Date: 4/6/2006 8:06 PM|
|Author: cliff666||Number: 50950 of 81642|
Have you seen Sue Stevens' article in Morningstar - "Model Portfolios for Retirees"?
Also, just how much money do YOU think a person needs in order to retire?
There's only one answer to that question..."It depends"!
I was going to say what Bill did, "It depends". How long do you need for the money to last? (Or how old are you?) How much are your expenses? And how large is your nest egg? These can force siome decisions (or not).
The morningstar article overlooks all of that. Focuses on things like "conservative", "aggressive". Seems only a partial answer.
I start by suggesting very liquid assets for five years worth of expenses. Then at least another five years worth in conservative CD's or Bond-type investments, depending on your situation and taste. The rest should be in a growth portfolio. Only you can define what you mean by "growth" (But it should not be defined as High-flier risky stocks line the NAS.) It should include a mix of asset classes, includint REITs.
Am I following my own advice? Not completely. Still working on step one, actually. I have SS and a small pension as a base, and income from our American Legacy Annuity (a variable - mutual fund based). Then I am taking income from my REITs. This amounts to a good bit of our income needs, but we still need income, so I am setting up a stream from some of the mutuals. Now to set up the cash accounts. I actually had a year's worth in Vanguard's MM acount, but then I got our tax bill, along with the Roth IRA's for us both and the Missus's SEP IRA. And estimated taxes for 2006. Poot. 8^( Sorta cleaned out the till.
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