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Where do you plan to keep your money once you can begin withdrawing a decade from now?
I guess some cash, bonds and some stocks. Maybe buy a house with what I have on hand and whatever I can withdraw reasonably.
I ask wondering the same for my own IRA. I imagine a high percentage of IRA holders just keep their nest egg in the same stock funds, thus still remaining exposed to the same market risks.
I remember back in 2008, my newly retired uncle, a wealthy dentist, ended up having to go back to work for several years until the market recovered.
Best long term investments today are probably water rights related as water will become a scarce/highly allocated resource within a decade.
Anyone nearing retirement should drastically reduce their equity exposure, especially if they’ve already hit their number.
Cartoon jpegs and shitcoins
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Well there’s the “could I get by with this” number, and the “this would be a whole lot more comfortable” number.
What riverman said. I’d probably go something like 60-40 stock/bonds.
But it depends on a lot of things. If you can get your withdrawal rate under 2%, I’d argue 100% STONKS is best. But that’s probably not the standard advice.
Yeah I don’t plan to retire anyway. But always try to do something to make money, at least until I’m 70 or so, probably while I’m traveling around. What the stock market does may dictate how much the work is superfluous vs. necessary.
Is it? Or do we have a supply chain disruption and labor supply problem? You can’t take 5% of the worlds oil off the market without driving up everybody’s input costs, nor can you have millions of extra people die without a labor shortage.
Sure, there was too money supply but that drove asset prices up (and higher interest rates are driving them down now), not convinced it trickled down much tbh. Idk, not sure how to untangle all the contributing factors.
The less monetary the cause of the inflation is, the less effective the Fed can be mitigating it I suspect, which could be a problem.
The other problems is you never know how comfortable you will feel at your number until you’re there. Every time I have set myself a number, when I get there I realize it’s not enough. I swore I wouldn’t let it happen again, but I think it is going to. I would be scared AF to retire in the current climate. Sequence of returns would be very likely to crush me.
If you’re going to do 60/40 and accept that 40% of your portfolio is going to return bond yields, then something like 60% equity / 40% annuity will actually start to make sense.
I think that’s fine too. How easy is it to make that all happen within a retirement account?
Going from stonks to bonds is trivial. Going from either of those to an annuity within an IRA is something I’ve got no idea about.
It didn’t trickle down but giving people not living paycheck to paycheck exponentially more disposable income through giveaways(ppp/trump tax cuts) and then compounding it with that causing insane asset bubbles (stocks, re, monkey jpegs) is driving this imo yes.
Eta-the supply chain issues matter also but they aren’t driving asset prices up. Commodities sure.
Yeah, this is kind of my plan too. Mostly because I like the work and if I don’t really care about getting paid, then I can be selective about what I take on. But if I end up needing the money, then I’ll have to be less selective.
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Oh it should be trivially easy. You just buy an annuity, the money transfers from your IRA to the insurance company (tax free transfer), and the payments from the insurance company to you are taxed as income as they are received. Your IRA going forward would just have the equities.
That’s the part I’m not clear on. How is that tax free? If I’m just selling the bonds and then using the proceeds to buy an annuity then I’d be taxed when I withdraw the money to use to pay the annuity company.
On the other hand if I conduct the whole transaction within the IRA then the payments should just go to the IRA (tax free) and I would only be taxed on what I withdraw, which could be more or less than the annuity payment in any given year.
The tax rules (in Canada - I believe it’s the same in the US) permit you to roll over the money to an insurance company tax free. It’s basically like a transfer from one IRA provider to another.