Investing during retirement

schiff

OldMusicGuy wrote: »

You should invest the 20K in the sort of fund that meets your long term objectives. Do you need growth or are you protecting against volatility?

IMO you should have at least a 30 year financial plan that shows your expenditure needs over the next 30 years. [QUOTE}

If I had a 30 year financial plan I could end up in the Guinness Book of Records!

I found out about Terry Smith on here, was smitten with his attitude and started investing into Fundsmith in early 2016 at what turned out to be an opportune time, followed by Smithson recently. The returns have well outstripped anything else I've ever invested in (except my house!)

I don't really need growth, nor protection against volatility to be honest. I can weather the ups and downs.

Thrugelmir

Cash is always handy. While inflation may erode the value over time. At least the downside risk is minimal in these unusual times. 80% of the world's Central Banks are now in the process of unwinding their balance sheets. All that liquidity that boosted stock markets is slowly being sucked out of the system. I'd certainly ensure that I had sufficient guaranteed income before speculating too wildly.

OldMusicGuy

bostonerimus wrote: »

A number of studies in the US have shown that moving to lower volatility portfolios actually reduces the success rate in funding retirement. There is a natural inclination to want to protect your capital when you retire and that's certainly a big factor early on to mitigate sequence of returns risk and also for people who don't have a significant pension pot surplus.

Hey, I resemble that remark!

The most important lesson I learned is that you need an investment strategy that lets you sleep at night. My ultra-conservative approach definitely isn't for everyone.

Prism

bostonerimus wrote: »

A number of studies in the US have shown that moving to lower volatility portfolios actually reduces the success rate in funding retirement. There is a natural inclination to want to protect your capital when you retire and that's certainly a big factor early on to mitigate sequence of returns risk and also for people who don't have a significant pension pot surplus. But being too conservative is a danger that is often missed. Hence, a strategy of slowly increasing your equity percentage after retirement is worth looking at as it might increase the probability of you not running out of money and also increase the potential size of your ending pot.

Yes I agree. When I meant lower volatility I really meant swap out some of my highest risk active funds for other equity funds that are a little more steady. For example my Japan small companies fund has a 3 year standard deviation of 23 (compared to lets say a Vanguard World index fund at 10). When I am looking to take an income from equities I don't really want that Japan small companies fund being on one of its 'down' months.

My intention is to bring my equites/bonds ratio down around 60/40 and then see what happens from there

dividendhero

My intention is to pass my little stash onto an heir, intention is that they keep the investment and draw the income. As such my investment horizon is longer than my own biological limits

londoninvestor

OldMusicGuy wrote: »

pound cost ravaging in the early years of retirement

Thank you - I hadn't heard that term and it's much more vivid than "sequence of returns risk"

maxie014

dividendhero wrote: »

My intention is to pass my little stash onto an heir, intention is that they keep the investment and draw the income. As such my investment horizon is longer than my own biological limits

How would you go about setting that up?

Apodemus

dividendhero wrote: »

My intention is to pass my little stash onto an heir, intention is that they keep the investment and draw the income. As such my investment horizon is longer than my own biological limits

:T I applaud the concept, even though this tends to be frowned on these days. I hope to eventually pass my little stash on to what will be it’s fourth generation of care-takers. My granny lived frugally off her investments, passed them onto my mother, who passed them on to me. Of course, it is a bit of a “Trigger’s Broom” as I no longer hold ICI, Burmah and Courtaulds!

bostonerimus

OldMusicGuy wrote: »

Hey, I resemble that remark!

The most important lesson I learned is that you need an investment strategy that lets you sleep at night. My ultra-conservative approach definitely isn't for everyone.

Investing style is a very personal thing. If you can meet your income goals by being conservative then it's a nice place to be. Unfortunately many people end up either needing or wanting more income that say an annuity or a conservative dividend stock portfolio can provide and so they need to take more risk. It's balancing income with risk and making sure you have savings and/or an stable income floor in bad times that can be tough.

dividendhero

maxie014 wrote: »

How would you go about setting that up?

I've promised them that if they start spending the money on fast cars and slow horses, I'll come back and haunt them:A