Maybe this thread will be of interest to some of the posters on the forum. I have spent the majority of my life working for the same company. I am in the final few years of this journey. What began with endless possibilities and many forks in the road along the way, has arrived to a long sought out path that seemed so elusive all of those years before. Retirement. I am not at the end of this road yet, but it is no longer a distant speck on the horizon. I often think back at how quickly it went by. I think about all of the decisions made over that timespan. There were many. Some at the time appeared to be the most important and significant with great impact if chosen wrong or hastily. Only to travel further down the road and learn they were much about nothing. Of course there were others that did hold significance. Some led to promotions, better pay, and an extra bottle of Tylenol. There has been luck, worry, happiness, and the full gamut of emotion over a lengthy career. There are posters in the forum that I know are already retired. I suspect there are many posters that are not as well. There are likely many at different points along the way. I thought it might be a good idea to have a spot to post thoughts about it or share moments of the journey. It could be about your plans, your investments and how they relate to your long term/short term plans, or just random thoughts about it. Just in general....never overshare. Maybe you have already crossed the finish line and want to offer your own tips, story, or ideas. Retirement for me is a point where "You can no longer afford to buy my time."
I had almost forgotten about this little thread I created a couple months ago. I guess I will add a short update. It appears at least TB16 passed through here. I really don't have to do too much within my plan, although I do have planned intervals where I review and make decisions occasionally. As the road to retirement gets closer I like having the time to think and review some things in advance so that I am not in a short window trying to execute a plan. I guess it was a few months ago where I had arrived to begin considering whether I wanted to evaluate reducing a bit of equity exposure. If so, this was not going to be a major move in one fashion at once. It would likely begin gradually and give me some time to determine at what percentage or allocation I might want to arrive at. My whole plan allows me to remain quite aggressive on the equity side, but as you get older and closer to retirement, I can assure you the lens at which you view these things does change a bit. There are some things within my plan that do allow for a more aggressive portfolio. The question then becomes whether I "need" to in order to achieve my financial goals to retirement and afterwards. The answer I arrived at was simply....no. During this process I learned there were actually more choices than reasons to make them. I am still evaluating some of that information. I did begin by adding a Treasury bond fund to the plan. As stated above, it is a gradual move over a period of time. My thoughts are that I will eventually end up at an allocation that I feel is right and want to settle in at. This gives me a bit of a longer time period to consider it. I am fortunate that I will not have to rely solely on my investment portfolio for retirement income, but I always like to be prudent and consider the whole picture. It is a part of the overall plan and is always a factor in those decisions.
I will watch this, as though I am still a couple of decades away from where you are, I am always open to knowledge about how to transition into retirement.
I appreciate this thread and feel a reverence for it. Because of this, I do not wish to soil it with my typical mindless posting.
Here are some figures that I take a look at from time to time to remind myself of a significant event that tested many investors will power, mine included. Of course, you could do the same with any other significant time period and see the results. All investors should know their risk tolerance, but it also becomes even more important as one transitions and approaches retirement. During your early working years you have the income safety of your job (most of the time). You are able, if necessary, to remain employable when younger. I think it is always important to know your limits. It is even more important as you get closer to retirement. It also depends on your plan. Factoring in whether you have a company retirement plan, a pension, timing of social security and other factors. Not everyone is the same. However, we all need to know that we can stick with it when we are now going to be relying on what we have created over our working years. In my opinion, it is important to begin these evaluations early. This may be a specific set of years before pulling the rip cord. It will give you time to consider what you need to do so you are not in the thick of it trying to figure it out. The point is, you and your plan have to survive the event. This is not to say we can anticipate or predict the future, but you have to have a general idea of what you can handle. There is only so much you can do. My mantra has always been....it is good enough. It does not have to be the best. Below is just one general example. It is offered only to provide something to think about as one nears and approaches a different time in their investing life. Maximum Drawdown during the Recession of 2007/08 (SP 500 and Total Bond Fund). Stock Allocation Maximum Loss 0% -5.01% 10% -6.10% 20% -8.53% 30% -13.41% 40% -19.32% 50% -25.10% 60% -30.66% 70% -36.01% 80% -41.14% 90% -46.07% 100% -50.80%
A little update to this thread. Not much to report, but I like to come back to it from time to time and stay engaged with the topic. I am still sailing along with work with the rest of you out there. Seems in the final years I am more busy at work than I was many, many years ago when I started. Maybe it is due to focus on things, maybe it is the position, but I seem busier now than before for some reason. Plan wise, not much has changed. I have added a bit to my Treasury bond fund since my last posting, but not significantly so. As mentioned above, this will be a slow and gradual process and I suspect I will end up at an allocation I want. I am not there yet and I have not decided on a general percentage at this time. I have plenty of runway left to consider it and evaluate as time passes. I will likely still be very aggressive on the stock side in the end. At least that is what I believe at this moment. I will have plenty of retirement resources built into the plan with a really good pension, my investment portfolio, and social security at some point. Although, I have never really factored in the SS as a key component of the "make it or break it" position. In other words, if it wasn't there, I could still obtain my goals. I will be able to weather any of the storms that may come along. Once completed, the last and only thing left will be the "departure date." I suspect I will be well done with the above somewhat in advance. This is purposeful. I want all of that set and done with so that the only decision left is when to sail off into the blue yonder. I have a built in minimum of time I know for certain left to go. After that, it is simply a choice of what I want to do as far as an exit date is concerned and will have nothing really to do with the financial side of the plan.
