windaar wrote: Tue Oct 21, 2025 9:43 pm
I’m 65, my “magic number” was $1MM and I now have $1.1MM with expected 4% retirement withdrawls. My SS will be about $30K/year. My AA is 30/70 with the fixed entirely in TIAA Traditional earning about 4% with a 3% guarantee. Even with this AA, a 2008 crash would be a problem for me. I’d appreciate AA advice considering all of this. I’m wondering if all of that $$ in TIAA Trad is a bad “eggs in one basket” situation and I should have some of that in MM or another TIAA fund due to TIAA “claims paying ability,” etc. Would 25/75 be nuts or would that be best for me in this situation? I realize I need an inflation hedge. i also need to sleep well at night and if my retirement savings went under $1MM I would not sleep.
a 30/70 portfolio’s worst drawdown was -13.41%:
Which means the $1.1 mil would have dropped to $952,490.
If you needed $40k first year (adjusted for inflation), that is 4% from the $1 mil you needed then even if the market lost 50% and your 30/70 lost -13.41% then you’d still take $40k out of $952,490 which would be a 4.2% withdrawal rate.
I don’t think it’s a problem. If you’re earning 4% on the 70% that’s providing 2.8% of your return. To get just another 1.2% (to get to 4%) you only need to make 4% a year on the remaining 30% in equities. Stocks have earned more than 4% annually and even people thinking equity returns will be low are not predicting THAT low.
Even in the 73-74 bear market a 30/70 portfolio only fell 10% (from fellow boglehead pkcrafter’s excellent online book Roadmap for Investing Success:
A Look at Historical Market Losses – Downside Risk You can get a fair perspective on risk by looking at actual stock market losses compared to how much money was allocated to stocks. The table below is based on actual market losses (price) encountered in the brutal 1973-74 bear market. A bear market is normally defined as a market decline of 20% or more. Drops of 10% to 15% are called corrections. Note in the table that a 100% stock portfolio lost nearly 50% of its value in two years (46% actual). If you had 50% stocks and 50% bonds, your loss would have been limited to 20%.Equity Exposure……. Max loss
20%…………………………………5%
30%……………………………….10%
40%……………………………….15%
50%……………………………….20%
60%……………………………….25%
70%……………………………….30%
80%……………………………… 35%
90%……………………………… 40%
100%……………………… …… 50%
Data provided by Author Larry Swedroe on Morningstar’s ‘Bogleheads Unite’ Forum
source: https://investingroadmap.wordpress.com/2011/02/25/205/
do you want to work longer to build up more? How flexible can you be with withdrawals?
I wouldn’t go less than 30% in equities. Even Vanguard’s target date retirement income funds are no lower than 30% and I believe there’s good reasons for that.
congratulations on hitting your number. For many the goalposts keep moving (think maybe inflation has something to do with that!). Curious to hear other suggestions from others.
