I retired at 59 in Jan 2020. We have been debt free and living on savings since then. My wife and I have IRA accounts with index funds and cash. Currently our ratio is 55/45 equities/cash. The cash plus social security would cover living expenses for 7+ years. After that 4% yearly withdrawal would exceed our needs.
My asset allocation needs to be rebalanced and I'm thinking 65/45. I also expect to inherit a significant amount that will be tax free. Most of that will be mutual funds but the rest will be cash.
When do you tap equities for expenses? Is it best to use the cash until it is reduced to a 3-4 year of living expense amount? Do you then only sell stocks in an up year? Is it best to sell the stocks monthly, quarterly, etc.? Does the 4% rule work if it is 60/40 index and cash versus index and bonds?
My asset allocation needs to be rebalanced and I'm thinking 65/45. I also expect to inherit a significant amount that will be tax free. Most of that will be mutual funds but the rest will be cash.
When do you tap equities for expenses? Is it best to use the cash until it is reduced to a 3-4 year of living expense amount? Do you then only sell stocks in an up year? Is it best to sell the stocks monthly, quarterly, etc.? Does the 4% rule work if it is 60/40 index and cash versus index and bonds?
Comment