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No. of Recommendations: 1
The answer depends on your tolerance for risk. Fools would usually recommend you keep as much in stocks as you can as this gives you protection from inflation. Bonds and fixed income investments do not. Therefore, the ideal is keep all your funds in stocks except for 3 to 5 years of living expenses in a secure fixed income investment like Treasury bonds or CDs. Laddered maturities are used. The fixed income investments are intended to keep you from selling stocks in a down market if stocks happen to go through one of those periodic corrections.

You will find these ideas discussed in great detail on the Retire Early Board. There is also a Bond and Fixed Income Board in the Investors Roundtable folder.

Your idea of shifting into more conservative blue chips could make sense as one way to reduce risk. Fools would rather do Foolish Four or one of the other Foolish stock strategies, but you should choose a strategy that you are comfortable with.

Best of luck to you.
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