1. what are your monthly expenses?I am a single female turning age 65 in March. I would like to reallocate and invest my money into some growth and dividend ETF's for. Given the market is at and all time high coming off of 1-2 strong years and I am hearing about some corrections, it gives me pause. Am I being over cautious? I know we cannot time the market but given my age I am concerned. I am a conversative risk averse investor as you will note below. The ETF's I am considering are Vanguard VOO, Fidelity FDVV, Vanguard VOOG and a REIT i.e. Crown Castle, Boston Properties or Prologics.
It matters because depending on how muh you even need to pull from the portfolio you might not need to take any risk. Granted cash will lose purchasing power over time so the point of investing at least some part of your portfolio (the target date retirement income fund holds 30% in stocks for this purpose) mitigates inflation risk (target date retirement income fund also holds some tips too which can help with inflation). I'm not suggesting this fund if your money is in a taxable account, but it could be helpful in a retirement account (tax deferred, not necessarily Roth where you want growth, not 30% stock, but higher than that).
2. I get VOO. That's S&P500 index fund and a well respected fund. But how did you come to get interested in FDVV (high dividend fund) and VOOG (S&P500 Growth index)? How did you find these funds/where did you hear about them?
3. Also, if you're talking about a taxable account, you don't actually want high dividends because that means you'll have to pay tax on all those dividends whether you need the income or not. It's not tax efficient in other words. So you not only have to think about what funds but where you hold those funds.
4. Regarding REIT how did you come to be interested in crown castle, boston properties or prologics? And why wouldn't you consider something simpler, publicly traded, highly liquid like Vanguard's REIT index fund (VGSLX or VNQ)? If you look at this link you see that Vanguard's reit index fund did better than boston properties and had less volatility than boston or prologics. Sure prologics did the best overall, but the drawdown was -84% as opposed to -73% for vanguard's fund. I can't see that Crown Castle is public so didn't include it here: source: https://testfol.io/?s=kfBRRYXq2FM
5. Finally, regarding corrections, you have to understand that stocks fall not just when you think they will or because you think they haven't for awhile or whatever. They fall every single year (on average 14% intrayear). Read that again. The amount may vary. The time when the fall occurs may vary. But you have to deal with declines all the time. Still the market recovers from these 75% of the time and produces yearly gains (see below). Also, the market is mostly in a drawdown phase (pullback from some higher level). So you have to deal with that as well as the market goes on to climb a wall of worry:
what do you think?
Statistics: Posted by arcticpineapplecorp. — Wed Jan 22, 2025 6:19 pm