Author Topic: When to sell mutual fund shares during retirement  (Read 2242 times)

bmjohnson35

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When to sell mutual fund shares during retirement
« on: November 23, 2019, 04:05:17 PM »

Let's say I have determined that we will need to sell $24k in shares in Vanguard to cover our monthly expenses.  If the share price is high in Jan (based on historical price), would it be better to sell all $24k in Jan and place it in the bank or simply sell $2k in funds from vanguard each month? 

It feels safer to cash out all $24k in Jan, if the prices are up, but I do recognize that all of the money I pull will no longer make money during the remainder of the year beyond a modest interest rate in the bank. 

Is there an place online to simulate this or other options?

Thanks,
BJ
 

seattlecyclone

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Re: When to sell mutual fund shares during retirement
« Reply #1 on: November 23, 2019, 08:56:06 PM »
I think the stock market is at or near an all-time high more often than not.

The question you propose is basically the inverse of the classic "I have a pile of cash, should I invest it all now or spread it out a bit?" question.  Vanguard has done the research on that, and investing it all right now is better than spreading it out over a 12-month period roughly two-thirds of the time.

I would expect that for your question, spreading out the sales will outperform an immediate sale about as often as an immediate purchase outperforms spread-out purchases.

smoghat

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Re: When to sell mutual fund shares during retirement
« Reply #2 on: November 25, 2019, 05:38:14 AM »
This is bull market logic but I wait for the market to get an intraday record high and sell that day. I stay about a month ahead of expenses and of course I have around a year in emergency reserves should there be a big downturn. I also have some diversification within my funds so sometimes my consumer staples fund gets a record high, sometimes itís the total stock market, sometimes itís VEIRX so I choose between those as well.

bmjohnson35

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Re: When to sell mutual fund shares during retirement
« Reply #3 on: November 26, 2019, 05:44:33 PM »
Thanks for those who have responded.  I thought there would be more feedback on this item.  I will try to do some simulation and see if I can gleam anything from it.

BJ

smoghat

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Re: When to sell mutual fund shares during retirement
« Reply #4 on: November 26, 2019, 06:21:33 PM »
Maybe the previous post on the same topic took the wind out of the answers?

https://forum.mrmoneymustache.com/post-fire/question-for-the-post-fire-group/

bmjohnson35

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Re: When to sell mutual fund shares during retirement
« Reply #5 on: November 27, 2019, 06:42:06 PM »

Thanks Smoghat!  I tried a search, but was trying wrong key words.

BJ