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I am not yet retired, (I have between 5 and 7 years to go) but I have given some thought to this question. At this point this is my strategy: I take Tom Sheard's advice that one can live on 5% of your portfolio each year. If you conservatively assume that the portfolio grows at 10% a year that allows 5% (10%-5%) growth each year to cover inflation. I plan to invest it all foolishly except the cash needed to hang on thru a bear market. The question then is how long do I expect to need to hang on. Well my reading of the tea leaves is that most recoveries since the depression took about 3 to 5 years. That means 15 to 25% needs to be in MM funds or better yet ST Bonds. The rest I plan to invest foolishly. I can't see gold or foreign currencies. I haven't figured out why anybody would buy an annuity.

Joe Varga
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