Retirement Investing

[VirginiaCat]

Disclaimer. Nothing on this thread either posted by me or anyone else should be considered investment advice. Just a general discussion around thoughts and models long before, getting close, at retirements, into retirement....


Ok, as I turned 58 I am really starting to think about retirement, at least in my current form of employment. Several reasons for me. I hate the risk every night that a staff or a resident will have a very bad outcome out of my control but for which I will be held responsible. Also because males in my family do not live too long..historically 75 is a top end and that is for normal sized relaltives. I am 6'6 and around 290# so not the longest prognosis and I would like to enjoy some trips with the wife. Another reason is ESG emphasis in my industry and I simply an not that leader. I believe in raising all ships and that is not what is wanted right now.

So, I think I have a 5/6 year window at most for current job. Looking at retirement models I am wondering if I am too late to move to a Divident Growth Investment model. Should have started 5 years ago I think.

Anyone else looking at retirement cash flow options?

[KentuckyWildcat]

I am 6'6 and around 290#

Can you play on the Offensive Line?

Obviously, I don't have any helpful advice. But wouldn't now be the time to move while the markets are still down and iffy?

[MickintheHam]

Disclaimer. Nothing on this thread either posted by me or anyone else should be considered investment advice. Just a general discussion around thoughts and models long before, getting close, at retirements, into retirement....


Ok, as I turned 58 I am really starting to think about retirement, at least in my current form of employment. Several reasons for me. I hate the risk every night that a staff or a resident will have a very bad outcome out of my control but for which I will be held responsible. Also because males in my family do not live too long..historically 75 is a top end and that is for normal sized relaltives. I am 6'6 and around 290# so not the longest prognosis and I would like to enjoy some trips with the wife. Another reason is ESG emphasis in my industry and I simply an not that leader. I believe in raising all ships and that is not what is wanted right now.

So, I think I have a 5/6 year window at most for current job. Looking at retirement models I am wondering if I am too late to move to a Divident Growth Investment model. Should have started 5 years ago I think.

Anyone else looking at retirement cash flow options?

I think I understand where you are trying to go. I am not an advisor nor do I know a lot. I have however, saved enough to live on my savings and still sleep well.

Div Growth is a long term strategy. Fidelity's 45% model suggests you need savings of about 10x your current earnings. So, if you have that in savings now, a Div Growth Strategy seems to make sense. Alternatively, if you have a current savings base where a 2% yield (2% is the long term average yield of S&P stocks) will get you to 10x by your retirement date, a Div Growth Strategy seems to make sense. A savings base short of that seems to indicate you need either additional savings or higher yielding (more aggressive) investments.

In retirement, I keep about 35% in stocks and ETF's that yield about 2.5 to 3%. The rest is more aggressively invested except for about 1 year's RMD equivalent which remains liquid. This allows me to avoid selling investments in a down market to meet the RMD requirement, provided the downturn lasts no more than 2 years. So far, that has worked.

[catmanjack]

I am always so interested in these threads but have little to add and only trying to educate myself.

[MickintheHam]

I should have noted in the above post you may want to seriously investigate preferred stocks. While they trade in a narrow range and you may miss out on stock growth opportunities, Yields are significantly higher generally in the 3% to 5% range.

[VirginiaCat]

I should have noted in the above post you may want to seriously investigate preferred stocks. While they trade in a narrow range and you may miss out on stock growth opportunities, Yields are significantly higher generally in the 3% to 5% range.

Thanks Mick. I worry I am too late for a true DSI model as my horizon is 5-8 years. As I understand it if you find stocks that have a proven historical dividend growth rate and find it at say a 3% dividend to day and the dividend has increased by 3% per year that means in year 10 it has a 5% dividend. If you build a portfolio around that model you technically have a portfolio returning a 5% dividend annually in 10 years.

But it is finding those companies committeed to increaseing the dividend on an regular basis. I think common examples are McDonalds and I know Stanley Black and Decker is a popular choice right now.

I know I am not interested in annuities. I also know I do not plan on having my current income level at retirement. I am focusing more on what our current cash flow is vs Current income. By the time I factor in what Uncle Sam and Aunt Virginia take out and reduce by my current retirement and savings contributions and if I take out mortgage debt payments (I assume we will always have a car payment) we will need a lot less cash flow in retirement than we need currently.

[MickintheHam]

If you google Dividend Aristocrats, there is a listing of 67 S&P 500 companies that increased their dividends over the last 25 consecutive years. It’s a good place to start.

[VirginiaCat]

If you google Dividend Aristocrats, there is a listing of 67 S&P 500 companies that increased their dividends over the last 25 consecutive years. It’s a good place to start.

THANK YOU SIR!

[VirginiaCat]

Ok, while the Banking stuff kinda gives me the chills, I think this could be a good buying opportunity for some guaranteed income in preferred stocks so went looking today with some with a good history of principal maintenance and long term 6% or higher yields. FifthTHird (FITBI) and Regions (RF-C) jumped out at me. But then I found some funds that spread some risk and ended up picking a Spyder PRefered Fund (KRE). pretty good stability over time and actually, like most things, near 10 year lows right now.

[MickintheHam]

Barron’s has touted Fifth Third and Regions as good banking investments. I have taken the opportunity in this banking downturn to up my position in Regions. I know several executives at Regions and have confidence in their judgement and banking skills.