Author Topic: Mechanics of actual money after official "retirement" - Asset Allocation  (Read 1591 times)

dinkhelpneeded

  • 5 O'Clock Shadow
  • *
  • Posts: 75
    • Silicon Valley RE-FIRE
Assumptions:

Age: 35, married 2 kids
Net worth (not including primary house): $700K
Total cost of living: 28K/yr (technically @ 4% withdrawal, this is possible)

I consider my 401k money, dead, because there's a long way from 34 to 60-62 when that money is actually available. How is it that people are so quick to say stach * @4% withdrawal will get you what you need. Allocation seems to be a BIG part of it, and I need to get that RIGHT.

Can someone walk me through the mechanics of how this 700K would be allocated, ideally? Assuming you are moderate-risk and reasonably diversified and dont want to erode your principal.

My apologies if this has been discussed before, please feel free to point me to the right threads.









Frankies Girl

  • Magnum Stache
  • ******
  • Posts: 2953
  • Age: 81
  • Location: The laboratory
  • Typical Ghoul Next Door
First, 401K/IRA money is not locked out until 59.5.... there are many, many, many threads discussing this. SEPP/72t or Roth pipeline are two of the most common methods of accessing. Do a search on here for either of those terms and you should come up with dozens of threads.

http://www.madfientist.com/traditional-ira-vs-roth-ira/
^good source for the Roth pipeline method - and rest of his site is awesome too

Second, you need an investment policy statement:
http://www.bogleheads.org/wiki/Investment_policy_statement

Third, you need to get caught up (if you aren't already) on index investing. Once you figure out what your risk level is, the actual asset allocation (for a basic passive/index portfolio) is really quite easy - can be 2-3 funds over all of your accounts.

http://jlcollinsnh.com/stock-series/
^super place to start - and lots of great info here as well

http://www.bogleheads.org/wiki/Lazy_portfolios
^great example portfolios



And I'm confused on your name... I thought a DINK was "dual income, no kids" and you say you have 2?
:)

« Last Edit: July 23, 2014, 05:26:27 PM by Frankies Girl »

dinkhelpneeded

  • 5 O'Clock Shadow
  • *
  • Posts: 75
    • Silicon Valley RE-FIRE

And I'm confused on your name... I thought a DINK was "dual income, no kids" and you say you have 2?
:)

I will eventually have them! Still DINK for now. :P

trixs

  • 5 O'Clock Shadow
  • *
  • Posts: 4
If you want to see how various allocations have performed you can play around at: http://www.portfoliovisualizer.com/