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Author: stardustangel Three stars, 500 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 75335  
Subject: Retirement money advice Date: 12/16/2004 5:38 PM
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My boyfriend's father, age 77 years old is retired.

I recently learned that his father was not managing his retirement accounts well at all.

Specifically, 90% of his nest egg is in stocks.

He has not taken a single mandatory distribution from his IRA or 401k.

He receives SS and a pension which I believe pay most of his expenses including a mortgage. He has no tax liability as his mortgage interest deduction wipes out his AGI.

I told my boyfriend to have him set up his mandatory distributions immediately, but we were wondering what is the best way for him to reallocate his portfolio.

He can convert some stocks to bonds in his taxable account. This will initiate a capital loss of 10,000 or so. Or he can convert the stocks in his 401 and IRAs to bond funds.

I don't know all the details of his financial picture. I do believe the eldest son helps with a few of the parent's expenses from time to time. I do not believe they have any other debt besides mortgage.

The last thing complicating the picture is my boyfriend's mother who is only 62 or so and in good health. Our hope is to preserve his money both for the duration of his lifetime and his wife's lifetime.

My thoughts were to put 50% into dividend producing stocks to allow him to have some income and the remainder into bonds.

Or potentially purchase an annuity for income purposes.

Any thoughts?
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