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401K Asset Allocation for T-8 Years Including Pension

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jereece
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401K Asset Allocation for T-8 Years Including Pension  Reply with quote  

I plan to retire in about 8 years. I have a personal and employer 401K and also a Pension with my employer. My 401k's are all invested in a balance of low fee small, mid and large cap index funds. My employer Pension has a fixed 4% interest so I consider it a fixed income investment. Currently 55% of my total retirement money is in my 401k's and 45% in my employer Pension. I know the recommendation is as you get older to move more towards conservative investments. Since I have no control over my employer pension, I have always kept all my 401k's in stocks. Now that I am about 8 years away from retirement, should I slowly (e.g. 10% per year) move my 401k investments to a bond fund?

I appreciate any thoughts or recommendations.
Post Wed Jan 09, 2013 4:59 pm
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oldguy
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Your age is the important factor - eg, if you plan to retire at age 50, you could have 40 years of retirement, ie you need stocks to protect you against inflation. Conversely, if you retire at 70, your retirent may be only half as long, so your goal is slanted more to wealth preservation and not inflation protection.

But your 55%/45% allocation seems good for now - later you may want to shift toward 50/50, or 40/60 - we always need some inflation protection.
Post Wed Jan 09, 2013 5:26 pm
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jereece
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Thanks...and BTW I am 55 so I agree keeping my 401k fully in stocks is my best option for now. I appreciate the feedback.
Post Wed Jan 09, 2013 6:39 pm
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