Ben, I think the word you're looking for is milquetoast not "milk toast" - sounds the same but it's not the same.
Also I disagree with your thesis of reduced stock holding in older age. I'm well retired and hold not a single bond in my portfolio - 100% equities. I figure I can withstand a sustained 50% drop in the market and not really care. I sleep soundly every night. I've also experienced 3 major market pullbacks and they didn't phase me one bit.
Bonds in this current environment have negative returns income wise and also a great potential for capital loss as rates increase - not a pretty picture.
Hey Gee. Thanks for the feedback. Curious if you have other assets or sources of income in retirement? Being able to withstand a 50% drop in your portfolio would put you in very rarified air, congrats on that, most don’t have the means or the stomach to withstand that.
Paid off personal use real estate, cash reserves (dividend income less expenses) and small government pension (CPP and OAS both taken early so heavily discounted - its beer money). Also have 35 years worth of personal expense history so I confidently establish what my minimum expense requirements are - I live well within my means currently and always have. That said splurges are also accounted for and taken.
I cannot foresee a market scenario where everything goes south for an extended time (i.e. > 6-12 months) - there is just too much uncommitted capital floating about.
Congrats on your success sounds like you are really on top of things. 👍🏻. Putting my economist hat back on, the CPP and OAS basically act the same way government bonds would in a portfolio (reliable and predictable income). That coupled with a low cost of living must take a lot of pressure off.
Great stuff. Thanks for sharing, sure lots of my readers could benefit from your experience.
Yes you are correct re CPP and OAS (same as other DB pensions or annuities) acting as "bonds", however in my case they represent such a small amount (beer money) that I do not consider them "bonds" i.e. I cannot trade them (aside: if I could, I'd take a lump sum settlement instead but alas not a possibility) - certainly nice to have but wouldn't cause devastating pain if they disappeared.
btw my cost of living is not particularly "low", certainly not wildly extravagant but I'm not making every dollar scream for mercy (but I do know how to do though if need be 😋)
Ben, I think the word you're looking for is milquetoast not "milk toast" - sounds the same but it's not the same.
Also I disagree with your thesis of reduced stock holding in older age. I'm well retired and hold not a single bond in my portfolio - 100% equities. I figure I can withstand a sustained 50% drop in the market and not really care. I sleep soundly every night. I've also experienced 3 major market pullbacks and they didn't phase me one bit.
Bonds in this current environment have negative returns income wise and also a great potential for capital loss as rates increase - not a pretty picture.
Hey Gee. Thanks for the feedback. Curious if you have other assets or sources of income in retirement? Being able to withstand a 50% drop in your portfolio would put you in very rarified air, congrats on that, most don’t have the means or the stomach to withstand that.
Paid off personal use real estate, cash reserves (dividend income less expenses) and small government pension (CPP and OAS both taken early so heavily discounted - its beer money). Also have 35 years worth of personal expense history so I confidently establish what my minimum expense requirements are - I live well within my means currently and always have. That said splurges are also accounted for and taken.
I cannot foresee a market scenario where everything goes south for an extended time (i.e. > 6-12 months) - there is just too much uncommitted capital floating about.
Congrats on your success sounds like you are really on top of things. 👍🏻. Putting my economist hat back on, the CPP and OAS basically act the same way government bonds would in a portfolio (reliable and predictable income). That coupled with a low cost of living must take a lot of pressure off.
Great stuff. Thanks for sharing, sure lots of my readers could benefit from your experience.
Yes you are correct re CPP and OAS (same as other DB pensions or annuities) acting as "bonds", however in my case they represent such a small amount (beer money) that I do not consider them "bonds" i.e. I cannot trade them (aside: if I could, I'd take a lump sum settlement instead but alas not a possibility) - certainly nice to have but wouldn't cause devastating pain if they disappeared.
btw my cost of living is not particularly "low", certainly not wildly extravagant but I'm not making every dollar scream for mercy (but I do know how to do though if need be 😋)