Message Font: Serif | Sans-Serif
No. of Recommendations: 1

This is for people in their 70s whose primary concern is stability and capital preservation.

Actually, the better allocation for retired folks, in normal economic conditions, consists of

>> 50% in income vehicles, such as "investment grade" bonds, and

>> 50% in growth vehicles, such as stocks of well-run corporations, to offset inflation.

The objective is to live off the interest or other earnings paid by the former and to rebalance periodically so one's income will grow to offset inflation.

Backing up a step, some people who are now in their 70's probably will live another 30-40 years or more. Traditional retirement planning assumes that one's money has to last for one's life expectancy, but I would hate to be the poor sap who lives to 110 after the money ran out at 95!

Print the post  


The Great Foolish North
Canadian social and off-topic banter.
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.
Contact Us
Contact Customer Service and other Fool departments here.
Work for Fools?
Winner of the Washingtonian great places to work, and Glassdoor #1 Company to Work For 2015! 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.