Just had another meeting with my Fidelity rep last week. I'm getting ready to retire in about 6 months, so his focus in our meeting is to ensure that my portfolio will generate an income stream to support essential expenses, while discretionary expenses would come from selling investments. Currently, I have no income streams in my portfolio, so he is suggesting purchasing a fixed income annuity to cover my estimated $5K/month of essential expenses. I understand the logic of this thinking, but am uncomfortable moving a relatively large chunk of my portfolio to an insurance company to get a steady flow of checks every month.
What do others think of this advice?
Are there better ways to cover expenses during retirement?
My specifics -
Emergency Funds: Yes - CD's and savings - ~100K
Debt: None
Tax Filing: Married Filing Jointly
Tax Rate: 22% Federal, no state income tax
State: WA
Age: 66, wife is 64
Desired Asset Allocation: 60 stock/ 40 bond/fixed
Desired International Allocation: 20%
Portfolio size: ~3M
Taxable:
3.8% Fidelity Money Mkt (FZDXX)
9.8% Vang Total Stock Mkt Index (VTSAX) (.04)
3.5% 3 yr Annuity started 8/2023, 4.85%, MassMutual
0.2% Cash
His Rollover IRA:
10.0% Fidelity Infl-Prot Bond Index (FIPDX) (.05)
8.9% Fidelity Zero Large Cap Index (FNILX) (0)
3.3% Fidelity US Bond Index(FXNAX) (.03)
4.9% Vanguard Total Int Bond Index (VTABX) (.11)
13.7% 5 yr Annuity started 1/2024, 4.4%, USAA
His Roth IRA:
2.0% Fidelity Zero Large Cap Index (FNILX) (0)
0.9% Fidelity MidCap Index (FSMDX) (.03)
5.5% Fidelity Real Estate Index (FSRNX) (.07)
9.6% Fidelity Zero Int Index (FZILX) (0)
Her Roth IRA:
1.3% Fidelity Zero Large Cap Index (FNILX) (0)
5.2% Fidelity Zero Int Index (FZILX) (0)
His Roth 401K:
13.4% SSgA S&P 500 Index (SSSYX) (.01)
4.0% SSgA Russell Sm/Mid Cap Index (SSMKX) (.04)
Contributions:
$8000 His Roth IRA
$8000 Her Roth IRA
$30,500 His Roth 401K
$4,700 - His 401K Company Match
What do others think of this advice?
Are there better ways to cover expenses during retirement?
My specifics -
Emergency Funds: Yes - CD's and savings - ~100K
Debt: None
Tax Filing: Married Filing Jointly
Tax Rate: 22% Federal, no state income tax
State: WA
Age: 66, wife is 64
Desired Asset Allocation: 60 stock/ 40 bond/fixed
Desired International Allocation: 20%
Portfolio size: ~3M
Taxable:
3.8% Fidelity Money Mkt (FZDXX)
9.8% Vang Total Stock Mkt Index (VTSAX) (.04)
3.5% 3 yr Annuity started 8/2023, 4.85%, MassMutual
0.2% Cash
His Rollover IRA:
10.0% Fidelity Infl-Prot Bond Index (FIPDX) (.05)
8.9% Fidelity Zero Large Cap Index (FNILX) (0)
3.3% Fidelity US Bond Index(FXNAX) (.03)
4.9% Vanguard Total Int Bond Index (VTABX) (.11)
13.7% 5 yr Annuity started 1/2024, 4.4%, USAA
His Roth IRA:
2.0% Fidelity Zero Large Cap Index (FNILX) (0)
0.9% Fidelity MidCap Index (FSMDX) (.03)
5.5% Fidelity Real Estate Index (FSRNX) (.07)
9.6% Fidelity Zero Int Index (FZILX) (0)
Her Roth IRA:
1.3% Fidelity Zero Large Cap Index (FNILX) (0)
5.2% Fidelity Zero Int Index (FZILX) (0)
His Roth 401K:
13.4% SSgA S&P 500 Index (SSSYX) (.01)
4.0% SSgA Russell Sm/Mid Cap Index (SSMKX) (.04)
Contributions:
$8000 His Roth IRA
$8000 Her Roth IRA
$30,500 His Roth 401K
$4,700 - His 401K Company Match
Statistics: Posted by breezly — Tue Sep 17, 2024 2:40 pm — Replies 19 — Views 834