I'm retiring from my government job next week. I'm probably going to take another job since I will be in the area for a while (at least until the end of the year) and my skills are still useful. Anyhow to use some example numbers, assume I have $500K put aside to cover my expenses for my next 10 years. This money along with the pension would be all we need. What would you do with the money?

1. Invest all in Treasuries/CDs?
2. Invest all in TIPS?
3. Invest mixture of TIPS/Treasuries CDs?
4. Invest in some mixture of stock and bond ETFs such as maybe 30% stocks/70% bonds?
5. Add stocks to option 3?

I'm leaning towards treasuries for the next 4 years and money in TIPS that would come due in 5 years and reinvest the money at that time.

I'm probably being fairly conservative here. At some point between FRA and 70 we will start collecting social security and likely that money with my pension would cover all of our current expenses. I also have a core account that will be mostly stocks (ETFs) and only used if I've underestimated our expenses (always possible) or used by my wife if I were to pass away early since my pension drops about 40% and obviously she would then only get the one social security check (mine).

I'm guessing some would say just throw all the money in a 60/40 stock/bond boglehead type ETFs and withdraw 3-5% as needed for the first 10 years and after that it may drop to zero.

Since you never know what the market might do, I think I prefer the fixed income approach.

Retirement Investing FAQ

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