Personal Investments • Should AA change if I have significant annuity income?

Let's say that I'm 61 with a significant risk of being forced to retire soon and that I have about $3.6m net worth, including $500k equity in a house that is paid off. Of the remaining $3.1m, $1.2m is tied up in single-life fixed annuities. ($1m in an immediate annuity with an 8% payout rate, and $200k in a pension that I would defer until I'm 70. SS also deferred until I'm 70, and then paying me $48k/year.)

So, in this scenario, there's $1.9m to invest however I would like. Considering that the annuities are kind of like bonds paying interest, should I invest more aggressively in the stock market with the remaining $1.9m than the typical 60/40 AA? (Of this $1.9m, about $1.2m is in tax-deferred accounts, and about $700k is in non-tax-deferred accounts.)

Now let's also assume that I have $600k in 2044 TIPS in a tax-deferred account paying 2.4% above inflation. Investing more aggressively in the stock market would imply selling these TIPS. But owning TIPS seems pretty good to me.

My desire in this scenario would be to spend about $100k/year in inflation-adjusted dollars, after taxes, until I die at the ripe old age of 99. (Note that in this scenario, I would have no children that I wish to make comfortable by leaving money to.)

Statistics: Posted by darius42 — Sat Dec 30, 2023 12:24 pm — Replies 4 — Views 201

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