No. of Recommendations: 0
This looks like a good place to get feedback on my plan for retirement (which is some years down the road) as I presently plan to continue to invest in my retirement years. If (and I know this is a very big IF) we can manage to achieve a balance of roughly $800,000 in our IRAs, my thought is that we would create our own little "mutual fund" of dividend paying stocks. If we do, does it seem to be too much to have 75 - 100 different companies? Are there that many different solid dividend paying stocks?

Right now I have a small Roth account from which I am trying to garner some experience in managing my own portfolio. From what I have experienced, it doesn't seem unreasonable to expect an overall annual dividend of 3%, which would equate to $24,000 the first year on an $800,000 portfolio. The other thing I have seen is that many companies tend to increase their dividends each year, some as much as 10% or more. What starts as 3% of $800,000 may be 4% the next year. And if the market is right, the $800,000 portfolio will increase in value. If I can live off the dividens, who know what it might increase to. Even if I needed to withdraw some of the principal in the early years, it seems like this should keep us from going bankrupt - provided I make sound investment choices - and diversify.

My spouse has a small pension and will be able to draw SS in about 4 years, so this wouldn't be the only source of income. To be sure we are prepared for a downturn in the market, I plan to keep a cash reserve equal to 2 -3 years of the minimum needed to meet the bills.

Does this sound like it is too risky?
Print the post  


The Retirement Investing Board
This is the board for all discussions related to Investing for and during retirement. To keep the board relevant and Foolish to everyone, please avoid making any posts pertaining to political partisanship. Fool on and Retire on!
When Life Gives You Lemons
We all have had hardships and made poor decisions. The important thing is how we respond and grow. Read the story of a Fool who started from nothing, and looks to gain everything.
Contact Us
Contact Customer Service and other Fool departments here.
Work for Fools?
Winner of the Washingtonian great places to work, and Glassdoor #1 Company to Work For 2015! Have access to all of TMF's online and email products for FREE, and be paid for your contributions to TMF! Click the link and start your Fool career.