CLEC Investment & Wealth DatabaseAsset Allocation When You Have Pledged Stock, Whether Retired or Not, and Whether You Borrow for Expenses or Not
Asset Allocation When You Have Pledged Stock, Whether Retired or Not, and Whether You Borrow for Expenses or Not
Related Materials
- Previous presentation: Safe Asset Allocation for Retirees With No Income Who Use Pledged Stock Loans and Have Already Borrowed a Large Amount! rev. 2.0
- Next presentation: Leveraged Funds, Cash, and QQQ/SPY Portfolios: Risk and Return monte_carlo_sim_cagr
Document Text
Whether retired or not, if you use pledged borrowing, please carefully watch the following playlist:
For people who are not yet retired and do not withdraw money from assets, the allocations for already-retired investors in scenarios 1 through 3 are safer than those for retirees who withdraw from investment assets. If you are still working, use pledged borrowing, and do not withdraw from assets, you can manually adjust our asset allocation. Only an allocation that passes a minimum maintenance ratio above 167% is safe.
We recommend watching the videos in our Investment Risk Management playlist.
Investment Risk Management https://youtube.com/playlist?list=PLiskER8xug1dxX1-UVDicxBW2FfEicJis&si=6Pk9FtR1-eDz3XNM
If 3%, or 36,000 per Month, Is Still Not Enough to Live On, You May Need to Use 0056 Instead
Using the example from short video 00162, if a retiree has NT$14,400,000 and no pledged borrowing, a safer allocation is 80% in 00662 and 20% in cash through 00864B.
The 20% cash in 00864B can also serve as an emergency reserve. Each year, the retiree can use 2% of NT$14,400,000, or NT$288,000, regardless of the remaining principal. The amount can be used every year. 00662 and 00864B should be rebalanced once at year-end or early in the year: 80% of total assets in 00662 and 20% in 00864B.
If 2% of assets is not enough to live on, the 00662 portion can be replaced with 00646. Since volatility is lower, the usable amount can rise to 3% of assets. With NT$14,400,000, that is NT$432,000 per year, or NT$36,000 per month.
If 3%, or NT$36,000 per month, is still not enough, you may need to replace it with 0056: 80% in 0056 and 20% in 00864B. That would allow 4% per year. Using NT$14,400,000 as the example, that is NT$576,000 per year, or NT$48,000 per month.
Disclaimer
The annual or monthly spending amounts above are independent of market fluctuations. Whether the market rises or falls, you can live on those amounts.
Of course, if one day assets rise to twice the size or more, spending can be increased. If after ten years assets reach NT$30,000,000, then the same calculation becomes NT$30,000,000 multiplied by 2%, 3%, or 4%, depending on whether you invest in 00662, 00646, or 0056.
The information above is for reference. We can discuss further if you have questions.
All emails, video content, and replies are for reference only. I am not a professional investment adviser or tax professional. All information is only personal experience sharing. Invest carefully, and take responsibility for every investment decision and action yourself.
This Information Is Only Personal Experience Sharing. Invest Carefully, and Take Responsibility for Every Decision and Action Yourself
Draft: James.
Safe Asset Allocation for Retirees With No Income Who Use Pledged Stock Loans and Have Already Borrowed a Large Amount! rev. 2.0
Safe Asset Allocation for Retirees With No Income Who Use Pledged Stock Loans and Have Already Borrowed a Large Amount! rev. 2.0
Leveraged Funds, Cash, and QQQ/SPY Portfolios: Risk and Return monte_carlo_sim_cagr
Leveraged Funds, Cash, and QQQ/SPY Portfolios: Risk and Return monte_carlo_sim_cagr