I am considering converting my company 401K that offers mutual funds only to an IRA where I can purchase individual stocks and use the RP4 and other strategies to obtain better performance over the long term than with mutual funds. My thought is that when I'm ready to retire in a few years I'll create a cash reserve equal to some number of years of expenses, say three, and keep the rest of the assets in stocks, moving to cash as required whenever the portfolio is adjusted. Is this a reasonable strategy given that I may be retired for 30 years or more? How many years of expenses should be kept in cash? What potential hazards need to be planned for? What experiences have others had with this or similar strategies?
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