Asset Allocation for People Still Some Time Away from Retirement rev2.0

Related Materials

• Previous presentation: Asset Allocation for People Still Some Time Away from Retirement rev1.0
• Next presentation: 00662 and QQQ Performance Question

Document Text

Asset Allocation for People Still Some Time From Retirement, or Retirees Who Do Not Need to Withdraw From Assets, rev2.0

The scenarios 1 through 9 discussed in video 00466 are for people approaching retirement or already retired who need to withdraw retirement funds from investments and have securities-backed borrowing. Scenarios 4-1 and 5-1 are for people who do not withdraw from investments, perhaps because they are still working or have enough pension income, and who do not use pledged borrowing.

If you are still young and more than ten years from retirement, the scenarios in 00454 are not especially suitable.

The 00454 simulations for scenarios 1 through 7 are for people already retired or close to retirement.

We have another video that explains this more clearly. Whether retired or not, and whether using pledged borrowing or not, it gives a better asset allocation framework:

00005 Special Topic: Multilingual Subtitles, Asset Allocation Summary, April 4, 2024, CLEC Investment Channel https://youtu.be/w4JjPypnUts?si=Nb-8PYOjreUXz9eA

For More Complete Information, Watch the Entire Investment Risk Management Playlist

Investment Risk Management https://youtube.com/playlist?list=PLiskER8xug1dxX1-UVDicxBW2FfEicJis&si=6dxaw_efbI1JeyX3

For people who are still some time from retirement, still working, or anyone retired or not retired who does not need to withdraw from investment assets for living expenses, use the following situations:

1. Keep six months of emergency reserves. Invest all funds in 00662 (QQQ), beta 1.0. This is not our preferred portfolio, because if the stock market falls to zero and you lose your job, how many years can you live on it? We still recommend safer approaches using leveraged funds with cash, such as situations 1 through 3 or situations 4-1 and 5-1 for people who do not withdraw from investments.

2. No emergency reserve is needed. Invest 80% in 00662 (QQQ), 10% in 00670L (QLD), and keep 10% cash in 00864B (money market fund). Rebalance 00670L (QLD) and 00864B (money market fund) evenly every year. Beta 1.0.

Fund); Rebalance 00670L (QLD) and 00864B (Money Market Fund) Evenly Every Year. Beta 1.0

3. Keep six months of emergency reserves. Invest the remaining funds more aggressively: 90% in 00662 (QQQ) and 10% in the 2x leveraged 00670L (QLD). Rebalance every year. This gives beta 1.1.

4. No emergency reserve is needed. Invest 70% in 00662 (QQQ), 20% in 00670L (QLD), and keep 10% cash in 00864B (money market fund). Rebalance 00670L (QLD) and 00864B (money market fund) evenly every year. Beta 1.1.

5. For retirees whose pension is enough for living expenses and who do not need to withdraw from investment assets: no emergency reserve is needed. Invest 80% in 00662 (QQQ), 10% in 00670L (QLD), and keep 10% cash in 00864B (money market fund). Rebalance 00670L (QLD) and 00864B (money market fund) evenly every year. Beta 1.0.

6. Keep six months of emergency reserves. Invest the remaining funds more aggressively: 80% in 00662 (QQQ) and 20% in the 2x leveraged 00670L (QLD). Rebalance every year. This gives beta 1.2.

7. No emergency reserve is needed. Invest 60% in 00662 (QQQ), 30% in 00670L (QLD), and keep 10% cash in 00864B (money market fund). Rebalance 00670L (QLD) and 00864B (money market fund) evenly every year. Beta 1.2.