Author Topic: 500K Investment Money  (Read 805 times)

GHG7F0

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500K Investment Money
« on: May 16, 2020, 08:34:43 AM »
I知 selling my home and I値l have about 500k to invest. I知 54 this year and plan on retiring from a Federal Service with a 30k pension in early 2024. Right now I invest in VTSAX, C Fund (S&P), G Fund (bonds) mostly. I知 thinking maybe a 60/40 allocation.

Body Surfer

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Re: 500K Investment Money
« Reply #1 on: May 16, 2020, 08:53:35 AM »
All $500K in cd's....do not trust this market until it drops to what YOU consider a reasonable level.

MustacheAndaHalf

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Re: 500K Investment Money
« Reply #2 on: May 16, 2020, 11:25:31 AM »
I知 selling my home and I値l have about 500k to invest. I知 54 this year and plan on retiring from a Federal Service with a 30k pension in early 2024. Right now I invest in VTSAX, C Fund (S&P), G Fund (bonds) mostly. I知 thinking maybe a 60/40 allocation.
If you invested 40% in bonds, that $200k would earn $3k/year (1.5% SEC yield for Vanguard Total Bond Market).  Normally during a down market, stocks have dropped significantly, and it's best to avoid selling them.  The other role of bonds is to avoid selling stocks in that scenario.  But with a federal pension, your first $30k doesn't have to be provided by your portfolio - you don't need as much safety.  I think you could afford a higher stock allocation, if you're comfortable with it.


All $500K in cd's....do not trust this market until it drops to what YOU consider a reasonable level.
Using portfolio visualizer:
Over the past 40 years, cash returned about 4.3% per year, which turns $500k into $2.8 million.
Over that same 1980-2020, US stocks returned 11% per year, turning $500k into $33.4 million.
Historically, 100% cash is terrible advice.

PaulMaxime

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Re: 500K Investment Money
« Reply #3 on: May 17, 2020, 04:56:18 PM »
All $500K in cd's....do not trust this market until it drops to what YOU consider a reasonable level.

This is bad advice. Don't time the market. Pick your asset allocation and go for it. Maybe dollar cost average in over a short period of time if it makes you feel better.


Retire-Canada

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Re: 500K Investment Money
« Reply #4 on: May 18, 2020, 08:15:15 AM »
All $500K in cd's....do not trust this market until it drops to what YOU consider a reasonable level.

What's the plan when you are in cash 5 years later and the market never dropped to "your reasonable level" and is now 30%-40% higher than when you could have bought in? Wait another 5 years hoping it's crash hard?