my lifestyle investing for 2025

[mathjak107]

i have been de-risking more and more for 2025 after two of the biggest years in my entire retirement investing time frame .

for this year i have a target of 40-50% equities , currently in the 40% range again as i shed some of the money that were in my most aggressive funds like fidelity blue chip growth which doubled in two years .

even my s&p fund has grown extremely risky as the index’s allocation to tech has quadrupled since 1994 and is now more risky than nasdaq was back then .

not only that but just 7 stocks have been responsible for most of the growth .

so i have been moving away from being so heavy into tech by cutting back on my index funds and fidelity blue chip growth.

now that i have passed thru the proverbial danger zone in retirement as i enter my tenth year i can be as aggressive or defensive as i like and still be just fine .

there are so many better ways to invest today using a world of alternative investments that used to only be available to the wealthy


thanks to the likes of those like cliff asness , they have brought to the small investor the ability to de-risk portfolios below what even the most conservative portfolios like the pp were known for , while providing superior returns compared to even a 60/40.

so for 2025 certain events have had me reconstruct my portfolio going forward .

hitting 73 i just took my first rmd , a whopping 80k .. that gets added to your income and will put us in danger of iirma surcharges on medicare . they can be hundreds a month at the highest levels for two people .

so starting with the taxable account i switched all cash money markets to new york triple tax fee money markets .

i have been adding little bits to NYF , the new york triple tx free muni bond fund .

while muni interest counts towards iirma surcharges on medicare it will reduce my over all taxable income now that the rmds started .

i hold only VTI and now berkshire which spins off nothing in the taxable account , making the taxable account as efficient as i can .

the retirement account is interesting as i have made leverage risk parity a big part after dabbling in it for a while .

equities side

fbgrx fidelity blue chip growth

feqix fidelity equity income

fdsvx fidelity growth discovery


dogs of the dow portfolio 10 highest yielding dow stocks , a value play

fidelity puritan 60/40 fund wife’s ira


the above are conventionally invested

now for the leveraged risk parity part

upro 3x leveraged fund for the equity side

the fixed income side is tyd a 3x bond etf



alternative investments as a hedge


gld gold etf

ibit bitcoin etf

AQR qlenx long short fund

AQR qdsnx diversified hedge fund

AQR qmhnx managed futures fund .


a few high yield bond funds like fhrrx and sphinx complete the assets.


it is far less volatile than my old model despite the leveraged funds since out of a dollar , only 20 cents goes in upro. , and .13 cents in tyd . .67 cents is in the three funds from AQR that do the hedging.

while just qmhnx would work as the hedge for upro and tyd , i like the extra diversification of the other two AQR FUNDS

[Smith1776]

I am always interested in hearing your perspective, mathjak. My mea culpa is that I should have listened to you about taking more risk while young.

[mathjak107]

i always say , there is no financial logic for long term investors to buy less capable assets geared to mitigating temporary dips while hurting long term gains permanently when short term is not a factor

that is for much later in life after you built up as much as you can .

the accumulation stage should be 100% equity funds or etf .

then 7-10 years before retiring follow the red zone glide path .

https://www.kitces.com/blog/managing-po ... -red-zone/

[ppnewbie]

Excellent post. Need to review carefully. I am in the glide path stage

[ochotona]

This "V-shaped glidepath" summarizes my approach perfectly. I turn 64 this year, will retire about 64.5, and I will consume a large slug of short term Treasuries (a short ladder) from retirement to age 70 at which point Social Security starts. As I consume the fixed income, the portfolio will naturally become more risky, and I will let it get more risky.

The Tactical Asset Allocation approach (which is time-serial safe havens instead of time-parallel safe havens) will let me keep just a couple of years of cash, the rest can be in TAA.

TAA has a crazy safe withdrawal rate... I took the annual time series from the portfolio backtest (55 years) and loaded it into Tyler's chart tools, and I come up with 6.6% SWR for a 30 year retirement.

But I'm keeping the gold.

[mathjak107]

i think 2022 was a rude awakening that old school portfolios like the pp just are not the bill of goods many more recent users expected .

they accepted years of lower returns in exchange for the supposed protection of a pp type portfolio and were let down with pretty steep losses ..

2022 showed how rising rates and the increased volatility we see today can be kryptonite to the pp .

so more modern ways of hedging and using leveraged risk parity may turn out to be the pp of the future.

don’t forget bigger gains in the up markets can cushion those bigger drops in the down markets and still leave you well ahead since markets are up 2/3s of the time and only down 1/3 and we have higher highs and higher lows as time goes on

[I Shrugged]

If you have interest in donating to charities, donating your RMDs makes excellent tax sense. If you can afford it and are so motivated, of course.

[mathjak107]

We already give to the charities we want and are not really interested in giving away any more at this stage

Much to early in the game for us

[I Shrugged]

We already give to the charities we want and are not really interested in giving away any more at this stage

Much to early in the game for us

I'm just saying that giving from the RMDs is better tax-wise than regular giving.

[mathjak107]

i agree

[yankees60]

We already give to the charities we want and are not really interested in giving away any more at this stage

Much to early in the game for us

I'm just saying that giving from the RMDs is better tax-wise than regular giving.

Somewhat similar to gifting long-term capital items rather than cash.

So agree if you are already going to make the contributions that another way to save taxes would be to use them to satisfy part or all of your Required Minimum Distributions.