I'm not sure I'd want it all in stocks since that is the most volatile and that money would be a huge part of our early retirement .
Again, I think this gets back to what I was saying earlier. I really think you need to put some time and thought into what you are afraid of and why. Let's talk about volatility.
Why does volatility matter? It matters if you need a good chunk of your 'stash in a short time period and that time period happens to coincide with a market dip. In the beginning of your retirement you run the risk of what is called sequence-of-returns. Meaning, that you happen to hit a rough patch of a few down years in a row while you are drawing down your stash that permanently impacts your portfolio in a negative way. This has been discussed a lot and (in my humble opinion) reasonable ways of avoiding this risk include keeping a couple years' expenses in cash/CDs, drawing down first from your bond allocation, or deploying a reverse glide path asset allocation where you retire with more bonds and slowly dump your bonds and increase your stock percentage as your retirement ages. Basically if you can get through the first 10 years of retirement in the clear, your portfolio should be too big to fail.
a portfolio that starts at 60% in equities and ends at 60% in equities ) has a 93.2% probability of success. However, a portfolio that starts at 30% in equities and finishes at 70% in equities actually has a higher (95.1%) probability of success, not to mention a lower average equity exposure through retirement (an average of only 50% in equities instead of 60%).
reverse glide path reading
https://www.kitces.com/blog/should-equity-exposure-decrease-in-retirement-or-is-a-rising-equity-glidepath-actually-better/If you really are talking about an early retirement, then you need your money to last you a long time, more than a traditional retirement. When you are talking about time frames past 30 years, inflation and outliving your money become the very biggest risk, provided you have successfully gotten past the first 5-10 years of retirement and are past the sequence of returns risk part. People readily underestimate the power of inflation and how powerful a force it is in reducing your spending power. You might be afraid of volatility when the market swings up and down, but the truth stealth scary risk is waking up one day and realizing that your stash has not kept up with the cost of living.
I'd recommend checking out this analysis
https://earlyretirementnow.com/2016/12/07/the-ultimate-guide-to-safe-withdrawal-rates-part-1-intro/ which is very detailed. Looking at the first table, at the extreme of a 60-year retirement at the traditional 4% withdrawal rate, the % success of 100% stocks is
89%. Pretty good, but I expect you can't stomach 100% stocks. Dropping that down to a potentially more palatable 50% stock allocation reduces your % success to
65%. Pretty much everyone around here will tell you that this is an unacceptably low chance of success and that you need to continue saving. To achieve the same success rate you need to drop your withdrawal rate down to 3.5%, which measurably adds years to your working career. I'm not saying there is anything necessarily wrong with this, but you need to be aware of what the real risks are and make your decisions based on your risk tolerance, logic, data, and what will keep you sleeping well at night. If you fully understand the upsides and the downsides and consciously say that an extra 5 years of work is worth it to you to have an asset allocation that makes you comfortable, then more power to you. Just make sure you understand the implications of the choice you are making.
As a personal anecdote, I've been told that my grandparents retired early (50?) with what was apparently a portfolio of $1M back in the late 70s/early 80s. As you can imagine, that was a ton of money (they were very frugal). Today my grandmother has about a years' worth of living expenses left and will be relying on her kids to pay her assisted living care bills when she runs out of money. How could this have possibly happened? A big factor, though not the only one, is that she has had her money in CDs earning less than inflation for the past 15+ years. That is a really powerful lesson to me in the importance of having an asset allocation appropriate to your real risks. In her case, longevity and running out of money is and was a real risk that was not properly balanced against her desire for a "safe" place to put her money.
That said, this is all academic if you can't hold the course and ride the inevitable ups and downs of the market. The market WILL go down eventually, and just as assuredly it will eventually go up. Check out this article on the "worst retirement ever"
http://www.gocurrycracker.com/the-worst-retirement-ever/ about someone who has terrible luck timing retirement and still comes out just fine, because he/she didn't panic and sell at the bottom. Know thyself! If you don't have that kind of stomach and think you will panic and sell at a downturn, then shield yourself against that. Either purposefully set your AA and then don't look at your investments, pay someone like Vanguard personal investment services to do some hand-holding, or opt out entirely by having your retirement income stream come from something like real estate that won't be as volatile.
