DW and I are both 54 YO and working. Both of us have always been unfazed by fluctuations in our portfolio. I wouldn't even call it allocation aggressiveness. It's just that we've been mostly stocks since we were young, didn't change anything as we aged, and didn't pay attention to big downturns we've been through and it all worked out. We're currently at 90/10 stocks/bonds and I'd like to reduce to 70/30….maybe (not even sure of the exact allocation).
The only financial goal we've ever had is to pay for college for our three kids. We have a senior in college, a junior in college, and a junior in high school. We have 529s and cash in a HYSA enough to cover college.
DW has two 1/2 time jobs which make one full job. Both are low paying and low stress and she enjoys them. The majority of our income comes from my higher paying job. I am an average "nothing special" middle manager tech worker and I know age discrimination is in my future. I'm also severely burnt out. The upcoming possibilities are:
I know the question is always "what is the purpose of the money?" "when do you need it?" "what are your immediate plans now and in retirement?" We don't have answers to this right now. DW and I have a lot of talking and soul searching to do and we have a lot of learning to do about retirement.
DW and I are not looking for advice on what to do with our lives right now and/or what our financial and lifestyle goals should be. Like I said, we have soul searching to do. My question is very specific: I want to change my allocation to reduce stock exposure but I'm paralyzed with information overload about how to do it. Types of advice I've seen:
"Just buy BND and be done with it."
"Bond funds don't make sense."
"Buy x% short/intermediate/long term bond fund. Match duration to when you need it."
"Buy individual bonds."
"Buy stable value fund. (Your 401k has a stable value fund? Hooray, that's great. Not everybody has this. You're lucky. Buy some of that.)"
"Buy T Bills."
"Make a T Bill ladder"
"Buy a T Bill fund"
"Buy CDs"
"Buy as many I Bonds as you can as fast as you can."
"Buy 33% BND, 29% T Bill ladder, 18% CDs, 9.81% gold, 3.14159% bitcoin, etc."
Without knowing when I'd like to begin withdrawing money from retirement funds, how do I even go about figuring out a plan for non-stock funds? I've at least researched all of the products above, so I think I understand them (except for gold and bitcoin…I have no interest in either). Believe it or not, my posting has nothing to do with recent market volatility. We plan to take our time, research, and think carefully about what we're doing.
Regarding what I have access to:
We have $70k in Ibonds, which is part of our emergency fund and college fund, so I have no problem interacting with Treasury Direct to buy more government products if needed.
I have an old Fidelity 401k (with a large overall balance) that has a stable value fund.
My current 401k does not have many good choices, but I have various IRAs and old 401k through Fidelity and Vanguard that have lots of bond fund choices that I could move funds into.
The only financial goal we've ever had is to pay for college for our three kids. We have a senior in college, a junior in college, and a junior in high school. We have 529s and cash in a HYSA enough to cover college.
DW has two 1/2 time jobs which make one full job. Both are low paying and low stress and she enjoys them. The majority of our income comes from my higher paying job. I am an average "nothing special" middle manager tech worker and I know age discrimination is in my future. I'm also severely burnt out. The upcoming possibilities are:
- I will be involuntarily forced out of my current job, and finding a similar job with similar pay will be difficult…even if I did want to make the effort to find the same job/responsibility/stress/pay. My current company is for sale, so depending on the new owners, this may occur soon.
*I may like to find a simpler, lower paying individual contributor type role in my same field, if possible.
*I may like to switch gears, coast FIRE, barista FIRE, do something different, fun, maybe part time at much lower pay.
*Maybe I stop working forever, wife keeps working.
*Maybe we both stop working
*Maybe I take a break from work and then go back
I know the question is always "what is the purpose of the money?" "when do you need it?" "what are your immediate plans now and in retirement?" We don't have answers to this right now. DW and I have a lot of talking and soul searching to do and we have a lot of learning to do about retirement.
DW and I are not looking for advice on what to do with our lives right now and/or what our financial and lifestyle goals should be. Like I said, we have soul searching to do. My question is very specific: I want to change my allocation to reduce stock exposure but I'm paralyzed with information overload about how to do it. Types of advice I've seen:
"Just buy BND and be done with it."
"Bond funds don't make sense."
"Buy x% short/intermediate/long term bond fund. Match duration to when you need it."
"Buy individual bonds."
"Buy stable value fund. (Your 401k has a stable value fund? Hooray, that's great. Not everybody has this. You're lucky. Buy some of that.)"
"Buy T Bills."
"Make a T Bill ladder"
"Buy a T Bill fund"
"Buy CDs"
"Buy as many I Bonds as you can as fast as you can."
"Buy 33% BND, 29% T Bill ladder, 18% CDs, 9.81% gold, 3.14159% bitcoin, etc."
Without knowing when I'd like to begin withdrawing money from retirement funds, how do I even go about figuring out a plan for non-stock funds? I've at least researched all of the products above, so I think I understand them (except for gold and bitcoin…I have no interest in either). Believe it or not, my posting has nothing to do with recent market volatility. We plan to take our time, research, and think carefully about what we're doing.
Regarding what I have access to:
We have $70k in Ibonds, which is part of our emergency fund and college fund, so I have no problem interacting with Treasury Direct to buy more government products if needed.
I have an old Fidelity 401k (with a large overall balance) that has a stable value fund.
My current 401k does not have many good choices, but I have various IRAs and old 401k through Fidelity and Vanguard that have lots of bond fund choices that I could move funds into.
Statistics: Posted by w7thMark — Tue Aug 06, 2024 4:33 pm — Replies 8 — Views 783