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Tuesday, June 10, 2014

Better late than never? We'll see.

We know exactly where our retirement and savings funds are but we rarely think about whether or not they are where they should be! Well that changed this past two weeks as we started talking about where to invest the money I will inherit from my parent's estate (thanks Mom and Dad! I'd rather have you still around though.). That discussion led to creating a spread sheet of each different savings account, CD, bond or retirement fund with the associated rate of return this past year. Yikes.

We are conservative investors and pretty risk adverse yet we also know that inflation and taxes are currently nullifying what we are earning if not diminishing the principal as well. So we moved one retirement fund to a target date fund that is about 50% in stocks at the moment but will have a slowly decreasing percentage invested in them over time.  That still leaves us with conservative investments overall and we know we missed the stock market party of the last few years. Sigh.

It is so difficult to balance all of the economic projections, our risk tolerance, inflation, projected longevity, etc. and make what seems to be the "right" decision. I know we are truly fortunate to have this problem but it is a problem none the less!

Still undecided as to the appropriate investment for my inheritance but I am leaning towards a target date lifecycle Vanguard fund to minimize annual fees and hopefully have a balanced investment. We never factored this money into our retirement financial planning so we are hoping it can sit and grow for at least most of the rest of our lives. It will be our self funded long term care insurance most likely.

How do you make investment decisions? How often do you review them? Do you look at your total financial picture before making changes or only at the specific investment?

5 comments:

  1. Hi, Juhli! That is quite a problem you have on your hands. I am so sorry. :( I don't know much about investing except that it's how I lost some money (not too much).

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    1. I know - some problem to have. Still the decision making process is difficult as my brother is much more of a financial risk taker than I am and will be using riskier investments so talking with him isn't helping.

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  2. We have a variety of investments. We started with mutual funds back in the 80's and eventually also invested in individual stocks. As far as funds go I have divided up our money into all the different categories. Thus each year some go up and some go down but overall have trended up. It is too hard to try and time the market. We also decided to find a financial advisor to help us invest some money. One reason was that if we ever are not able to do our own investing there will be someone who knows our situation and who will be able to help us. We have been really pleased with the returns he has delivered.

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    1. You are so right about not trying to time the market. I do need to figure this out soon though.

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  3. Hi Juhli! Financial decisions are usually the hardest to make. I suggest you seek advice from financial advisors. Their insight can help you decide on how you can invest your inheritance. I wish the best for you and your husband.

    By the way, we featured this post in our Weekly Digest. You can read it here http://www.ltcoptions.com/weekly-digest-ways-save-retirement-pay-long-term-care/. People can learn two things from your experience, and that is to plan ahead of time (which you are successful at doing) and to be constantly prepared for financial changes and uncertainties.

    Thanks again, Juhli. I hope that the next time I visit your blog, there will be good news regarding this matter.

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