No. of Recommendations: 0

I'm 42, married with 4 kids. My wife and I retired 4 years ago. Last January, I
switched our stock portfolio from mutual funds to individual stocks.

Our investment portfolio consists of 5 years of living expenses (17%) in a MMF
and the rest (87%) in a 12 stock RKE portfolio. R is 4 Foolish Four stocks. K
is 4 KeystoneEPS stocks. And E is 4 PEG semi-annual stocks.

Our withdrawal rate is 4% of our stock portfolio's value per year which is
deposited in the MMF every January. We then live off of 1/60th of the MMF
total per month for the next 12 months.

Our portfolio costs are as follows: 0.8% commissions, 0.8% spreads, 0.4%
taxes, 4% inflation, and 4% withdrawal rate for a total of 10% per year
"portfolio drag".

My only complaints about my RKE portfolio is that it requires about a 150%
turnover rate and costs about 1.6% of assets per year (commissions and
spreads). It is also volatile as hell.

Question: is this 12 stock portfolio a good portfolio for an early retiree like
myself or should I be in an index mutual fund or say 100% invested in 15 or 20
Rule Maker stocks? Four Foolish Four Dow (R) stocks plus four Beat the S&P
500 stocks (B)?

Any takers on this one?

I do not know the answer, but since you are asking the question I think you are looking for a smoother ride. I would put some money in a market index. The ideas would not be to beat the market but stay with it. If you stay with the market your retirement income should be ok. I think I would add a few more stocks also.
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