So I'm clearly no investment maven, but here's an honest query on the following scenario. We have a balanced portfolio' 75/25 equities, with a heavier weight on international stocks than domestic. Given all the uncertainty politically and economically, I'm looking for a withdrawal strategy that will allow us to leave the portfolio capital alone, and just take the profit opportunistically.
Total portfolio: approx $1m with a 10% profit this year to date, so $1.1m. Current cash=$275k+ in high interest account. With other assets (paid off real estate, etc), the net worth is about $2m.
Ultimately, we will settle into about 60-70k per year in expenses. I understand I'm losing to inflation and lost opportunity by keeping a large cash reserve, but why couldn't I just ride out the down market, living on the accumulated cash account, while taking profits when the present themselves. That is taking $75k-$100k of this year's profits off the table now, so I've made the year's income in August. If the market goes up, we start 2018 with a higher noncash balance. If the market drops, we wait (even if it takes a few years) before touching it until it is again positive.
Easy decision making, sell above $1m balance, and hold at or below.