Anonymous wrote:We are working with a financial advisor, and currently our allocation is 63% in equities. DH's 401K still has not been rolled over and has done quite well with over $3.5M at a 60/40 equities/bonds allocation. Not paying any significant fees for this 401K, but we are going to roll it over anyway considering he will soon be taking RMDs and we are also going to start Roth conversions and having it under the umbrella of our advisor's management we feel will take a lot of complexity out of it. We are getting a nice fee reduction to do this.

Advisor is proposing a 55/45 equities/bonds allocation for the new IRA. This would bring our entire portfolio to a 60/40 stock/bond allocation. He is allocating a lot to inflation protected bonds. I have asked him about the thinking behind this and we are scheduled to meet next week.

One thing to note is DH also has a $4.1M deferred comp account (not under advisor's mgmt) that will pay out approx $500K annually (before taxes) for the next nine years. This account is also invested at approximately 60/40 equities/bonds. On top of that our advisor manages the rest of our portfolio with the exception of a company stock account (which isn't doing great). Total portfolio is worth $15.8M and advisor is currently managing $5.1M. With the new IRA, that would increase to $8.6M

I ran all of this along with our current allocation through AI and they are saying we might be too conservative for our situation. Because DH is getting the deferred comp distribution every year, AI thinks we can afford to be a bit more aggressive with the rest of the portfolio.

Any opinions on this strategy? Should we push back on the 60/40 overall allocation?

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:If I am reading this correctly, then you have 11.7M investments + 4.1M that is being paid out 500K/year for 9 years.

Are you going to spend 500K/year? I'm guessing a portion of that will be reinvested.

The way I look at it is how much can I afford to lose. I am conservative, and I assume if we have a crash in retirement we need to be able to withstand a 50% loss in equities and a protracted flat period. So, I half our equities combine with bonds and from there determine what combination gives us about 3% return to live on.

We will spend a good portion of that after taxes, yes.

Well, 4% of 11.7M is 468K. You are covered for 9 years, not having to spend down from the 11.7M. And even if that drops to 8M in a crash, you'd have close to the 9 years to recover without having to touch the amount. Plus, I assume you'll be getting SSI. Also, the 4% is based on normal retirement years. You'll be tapping into the 11.7 much later. If you're close to RMDs only you can guesstimate how long you'll both live.

Have you run any of the online calculators? Firecalc, cFireism. There are others. I spent a good amount of time running those with all sorts of different input which helped me feel comfortable with what we needed and what we could spend. We were managed, but they drove me crazy. We have since gone to self managed.

Also, if you need the 500K/year now, will that go up or down in the future, taking into consideration potential LTC.

Anonymous wrote:OP's husband is in the 8th inning (about to take RMDs) and just now talking about Roth conversions, tips ladder, and asset allocation LMFAO

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:If I am reading this correctly, then you have 11.7M investments + 4.1M that is being paid out 500K/year for 9 years.

Are you going to spend 500K/year? I'm guessing a portion of that will be reinvested.

The way I look at it is how much can I afford to lose. I am conservative, and I assume if we have a crash in retirement we need to be able to withstand a 50% loss in equities and a protracted flat period. So, I half our equities combine with bonds and from there determine what combination gives us about 3% return to live on.

We will spend a good portion of that after taxes, yes.

Well, 4% of 11.7M is 468K. You are covered for 9 years, not having to spend down from the 11.7M. And even if that drops to 8M in a crash, you'd have close to the 9 years to recover without having to touch the amount. Plus, I assume you'll be getting SSI. Also, the 4% is based on normal retirement years. You'll be tapping into the 11.7 much later. If you're close to RMDs only you can guesstimate how long you'll both live.

Have you run any of the online calculators? Firecalc, cFireism. There are others. I spent a good amount of time running those with all sorts of different input which helped me feel comfortable with what we needed and what we could spend. We were managed, but they drove me crazy. We have since gone to self managed.

Also, if you need the 500K/year now, will that go up or down in the future, taking into consideration potential LTC.

Adding to say that our investment firm (that we left) was very much about them making their own numbers. They in no way beat the averages and in no way helped us with smart tax investing. And that was one of their biggest pushes. We could have just left it in VOO and done better.

Is the person you are using now doing well for you?

Anonymous wrote:OP's husband is in the 8th inning (about to take RMDs) and just now talking about Roth conversions, tips ladder, and asset allocation LMFAO

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:If I am reading this correctly, then you have 11.7M investments + 4.1M that is being paid out 500K/year for 9 years.

Are you going to spend 500K/year? I'm guessing a portion of that will be reinvested.

The way I look at it is how much can I afford to lose. I am conservative, and I assume if we have a crash in retirement we need to be able to withstand a 50% loss in equities and a protracted flat period. So, I half our equities combine with bonds and from there determine what combination gives us about 3% return to live on.

We will spend a good portion of that after taxes, yes.

Well, 4% of 11.7M is 468K. You are covered for 9 years, not having to spend down from the 11.7M. And even if that drops to 8M in a crash, you'd have close to the 9 years to recover without having to touch the amount. Plus, I assume you'll be getting SSI. Also, the 4% is based on normal retirement years. You'll be tapping into the 11.7 much later. If you're close to RMDs only you can guesstimate how long you'll both live.

Have you run any of the online calculators? Firecalc, cFireism. There are others. I spent a good amount of time running those with all sorts of different input which helped me feel comfortable with what we needed and what we could spend. We were managed, but they drove me crazy. We have since gone to self managed.

Also, if you need the 500K/year now, will that go up or down in the future, taking into consideration potential LTC.

Anonymous wrote:

Anonymous wrote:If I am reading this correctly, then you have 11.7M investments + 4.1M that is being paid out 500K/year for 9 years.

Are you going to spend 500K/year? I'm guessing a portion of that will be reinvested.

The way I look at it is how much can I afford to lose. I am conservative, and I assume if we have a crash in retirement we need to be able to withstand a 50% loss in equities and a protracted flat period. So, I half our equities combine with bonds and from there determine what combination gives us about 3% return to live on.

We will spend a good portion of that after taxes, yes.

Anonymous wrote:If I am reading this correctly, then you have 11.7M investments + 4.1M that is being paid out 500K/year for 9 years.

Are you going to spend 500K/year? I'm guessing a portion of that will be reinvested.

The way I look at it is how much can I afford to lose. I am conservative, and I assume if we have a crash in retirement we need to be able to withstand a 50% loss in equities and a protracted flat period. So, I half our equities combine with bonds and from there determine what combination gives us about 3% return to live on.