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Old 01-12-2015, 04:10 PM
 
677 posts, read 841,836 times
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I am getting very confused by many of the remarks made in some threads. A new thread this weekend has a widow asking how to make her money last. She has only SS, which is the same for us. No pension. Many responses, not only in this thread but in many, state "get out of stocks now". My confusion is that if you have money in mutual funds (Vanguard, Fidelity to name the ones we use) they obviously invest in the market. We will outlive our money if we aren't invested for the future. We have 2-3 years of living expenses in cash related funds as well (bonds, cd's cash). But it's just not possible to retire with the non existant interest rate these days if you don't have a pension unless you invest for the future.

Many on the forum live off their pensions and SS and talk about not touching their principal. We are not in that position. Having said this, what would you do?

Please understand that I am not complaining that we don't have a pension to rely on (although it would be nice!) We raised our children, put them through college, balanced our lives so that we saved and also enjoyed ourselves. I think we did a great job saving, but realistically, without a pension we do have to use our savings. We just don't want to outlive it!

Thank you in advance for your responses. So many of you are truly a gift here with your knowledge.
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Old 01-12-2015, 04:16 PM
 
Location: The Triad (NC)
28,544 posts, read 62,270,607 times
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Quote:
Originally Posted by saralvr View Post
She has only SS, which is the same for us. No pension.
We have 2-3 years of living expenses in cash related funds

Many on the forum live off their pensions and SS and talk about not touching their principal.
We are not in that position. Having said this, what would you do?
You (both) need to figure out a budget based on ONLY the SSI.
The cash is for an occasional treat or maybe the Grandkid's birthdays...
No more and not even groceries or rent.
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Old 01-12-2015, 04:52 PM
 
677 posts, read 841,836 times
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Would if we could! Our basic expenses are higher than SS would be. For us, we own our home and have no debt. We will eventually need a car as one of ours has about 110,000 miles and definately won't be worth putting money into once it needs work. It really sounds so simple to just get by on SS but it isn't always a realistic answer.
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Old 01-12-2015, 04:53 PM
 
677 posts, read 841,836 times
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Maybe I need to clarify...we have 2-3 years of cash related funds and the rest in mutual funds & bonds.
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Old 01-12-2015, 05:34 PM
 
6,545 posts, read 3,099,024 times
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There is no way I would ever be totally out of the stock market whether or not I had a pension.

Heck my parents in their 80's are still in the stock market. They have only a tiny pension my mother earned from a job she took just to get health insurance they could carry into retirement plus their social security.

They complain every time the market goes down and every time they have to take a required minimum distribution, but the reality is they are doing better than fine. I don't think they would be doing nearly as well if they hadn't had some of their money in the stock market.
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Old 01-12-2015, 06:12 PM
 
71,779 posts, read 71,896,917 times
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over 30 year time frames equities have proved to be the safest investments with the least amount of times frames where you would have run out of money before you ran out of time.

bonds and cash had the most failures except at much lower draw rates.

while stocks may not have the most comfortable ride because they are volatile diversified funds have rarely failed to produce the best results over retirement time frames.

50/50 has stood up the best with a fair amount of comfort.

Last edited by mathjak107; 01-12-2015 at 06:21 PM..
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Old 01-12-2015, 06:17 PM
 
6,309 posts, read 4,757,627 times
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saralvr, you might want to spend a bit of time on the City Data Economics-Investing forum.
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Old 01-12-2015, 06:20 PM
 
71,779 posts, read 71,896,917 times
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jrk it was a pleasure meeting you and your wife.
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Old 01-12-2015, 06:25 PM
 
8,208 posts, read 11,929,872 times
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Quote:
Originally Posted by mathjak107 View Post
over 30 year time frames equities hgave proved to be the safest investments with the least amount of times frames where you would have run out of money before you ran out of time.

bonds and cash had the most failures except at much lower draw rates.
Exactly. I found it incredibly amusing that several people in that other thread were warning that OP and others to stay out of stocks because they are overvalued according to them, but at the same time they recommend investing in long-term bonds at a time when interest rates are approaching historical lows. I can't think of much worse advice than getting completely out of stocks and putting all of your assets in bonds at this point in time. Not that I'm completely anti-bonds, mind you. My current portfolio is roughly 60/33/7, but my bonds are mostly intermediate term and short term.
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Old 01-12-2015, 06:34 PM
 
48,516 posts, read 84,010,700 times
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I am not sure of the question. But you are now in a position of fix income except SS COL. Then you have some savings you say. But you are dependent on each to withdraw. Their are two types of market investors. traders who continuing get in/ out of stocks and short others. The retail investors who are mostly long term. They normal have a investment account and they stay fixed over long term while at same time investing new money. There are also lots of people who trade a limited amount but by retirement they want much less risk; they aim more to maintain the value of their investments.
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