UnThreaded | Threaded | Whole Thread (12) | Ignore Thread Prev | Next
Author: alaskack Big red star, 1000 posts Old School Fool CAPS All Star Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 76074  
Subject: Re: Advice, please. Date: 8/16/2007 8:07 PM
Post New | Post Reply | Reply Later | Create Poll . Report this Post | Recommend it!
Recommendations: 0
What are her intentions with the portfolio? Does she plan to use it all or leave an inheritance? How are her income needs growing each year?

How many years would the portfolio last if the stocks dropped 50% in value? That is, if the stocks stopped paying dividends and lost 50% of their value, how many years would it last if you had to replace the income stream by selling? At your mother's age, if it lasts over 15 years in this worst case scenario, I don't think you have anything to worry about now and have plenty of time to make any changes if necessary. Even if it lasts only 10 years, you have time.

I would love to have your mother's "problem." Looks like whoever managed the portfolio did a great job. A key factor is if the income stream no longer meets her needs. Prior to that point you'll need to look at taking gains and how it will affect dividend income.

Are my worries unfounded?

Currently yes, but it doesn't hurt to ask questions and do some planning.

Do I need to do anything?

Yes, discuss her future cash needs. Find out if the present cash flow will meet her needs and for how long. That will give you an idea on your timeframe.

Is this a job for a professional?

If you do hire a professional, go with a fee only consultant, one who charges by the hour and not one who make his fee by selling something. I'm thinking that a consultant will likely cause a short-term tax hit for a very small incremental gain.

Calvin
Post New | Post Reply | Reply Later | Create Poll . Report this Post | Recommend it!
Print the post  
UnThreaded | Threaded | Whole Thread (12) | Ignore Thread Prev | Next

Announcements

The Retire Early Home Page
Discussion on accelerating retirement day.
Pencils of Promise - Back to School Drive
"Pencils of Promise works with communities across the globe to build schools and create programs that provide education opportunities for children."
Post of the Day:
Macro Economics

The Deflationary Cycle Explained
What was Your Dumbest Investment?
Share it with us -- and learn from others' stories of flubs.
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.
Community Home
Speak Your Mind, Start Your Blog, Rate Your Stocks

Community Team Fools - who are those TMF's?
Contact Us
Contact Customer Service and other Fool departments here.
Work for Fools?
Winner of the Washingtonian great places to work, and "#1 Media Company to Work For" (BusinessInsider 2011)! 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.
Advertisement