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URL:  https://boards.fool.com/rocannon-those-2-roth-ira39s-are-our-32762952.aspx

Subject:  Re: save investment Date:  6/29/2017  5:08 PM
Author:  gdett2 Number:  5166 of 5260

Rocannon,

Those 2 Roth IRA's are our original(1982) traditional IRA's with USAA Life Insurance. They are non-annuitized, annuities. They simply pay daily interest at 4.5% APR as the contract minimum. I converted them to Roth. They started over 13% APR and slowly wound down to the minimum in the mid 90's. I'm not concerned about loss of capital with them.

Most of the cash in them is actually investing cash that I use during a down-turn. We have one day access to the money. No fees of any kind.

The only limitation is we are limited to about $23K in annual deposits so I can't just sweep a large amount of cash into them. I can take out as much as I want however. In Dec 2008, I took them both down to $500 remaining to invest in stock.

Yes, as a position in our portfolio, they currently pay the most "income" in our portfolio.

"In 11 years, the dude has a pension and social security that will fund him going forward."

Going to an all cash-type portfolio just seems a bit extreme. It totally cuts off growth of any kind. An ETF portfolio of VOO, VO, VNQ, IWC and BIV could be tailored to provide some growth and some income. Some selective sales would provide the remainder of the necessary cash.

The real secret to living on investments is to leave them invested. We have the 3 year cash cushion I mentioned that is dedicated to our living expenses. It will not be invested. During a down-turn, like the 2007 to 2009 event, we lived on the cushion, took it down to about 1 year remaining. When things recovered, it was replenished. We didn't sell anything at depressed prices, which can do great harm to a portfolio. Some people use a CD ladder for their cash cushion.

Does that help you?

Gene
All holdings and some stats on my profile page
http://my.fool.com/profile/gdett2/info.aspx
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