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epiloguenc asks,

I am 100% in equities and can't seem to justify a move to bonds. I understand the market can turn sour...but I am not overly aggressive and good stocks and funds seem a safe haven to me. Would like some feedback from other retirees in training who share a similar philosophy.

Check out the Retire Early Study on Safe Withdrawal Rates at the following link:

http://home.earthlink.net/~intercst/reindex.html

If you look at the optimal asset allocations, the percentage of stock ranges from 82% for someone with a 50 year pay out period to 44% for an individual with a 10 year pay out period.

I retired 5 years ago at age 38 and haven't reduced my equity portion to anywhere near 82%, but I do keep 1 to 2 years worth of living expenses in a money market fund and 5 years worth in a laddered portfolio of CDs and US Treasury notes. As a minimum, I think a retiree should keep about 3 years worth of expenses in a money market fund or other short-term (less than 3 year maturity) securities.

intercst
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