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Who has the best M&A Tax Practice ?
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Additional Posts in FIRE Financial Independence Retire Early
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Are investment properties good for retirement?
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Mentor
At 60ish you have a 25-30 year lifespan, barring any health issues… 4%-4.5% coupons on treasury bonds will provide some degree of income stability, but at 2% inflation (targeted), your purchasing power quickly diminishes…
I use them primarily for my emergency fund and short term goals/sinking funds but know a few people who have done this.
You can either buy them directly from Treasury direct or through your brokerage account. I'm guessing you are going to try to set up a ladder?
If you are buying longer term remember that interest rate fluctuations can impact the value of your bond. That doesn't really matter if you hold to maturity but if you bought a bunch of 30 years and planned to sell some periodically you could have large losses (or gains). You will also be losing out to inflation, as you are getting 4% each year (if you choose one with a 4% coupon and are trying to live off of those instead of a ladder) but that will buy less in 10 years than it does now. You could also look at TIPS.
To your last point, with historical data you'd be better off investing in an equity index fund but I certainly understand the appeal of not needing to think about it.
What would you think about just doing a ladder that would get you to social security and investing the rest? Maybe that is a 10 year Treasury ladder providing you with just enough to live comfortably until you start taking social security?
That way the rest will continue to grow, likely at a much higher rate than 4%, but you don't have to worry about normal stock market ups and downs as your basic living needs are already covered by your Treasury ladder and then SS.
U kinda lost me at LCOL country. Keep in mind the FX impact. I would highly recommend diversifying with some bonds in their local currency (but questionable if we’re talking about South America). Non -issue if they’re pegged to the dollar.
My other thought is tax impact + inheritance + inflation. If a factor, you do your family a disservice if u don’t leave anything invested. From tax standpoint, not sure if foreign or local rates could be an issue. Inflation is something u might want to consider, and with ur risk tolerance it sounds like TIPS are the way to go.
Bottom line, if you are planning to go abroad this seems like a very important discussion to have with a CPA or specialized advisor
I’m gonna assume u want to go somewhere along the lines of Belize, Costa Rica, or maybe Mexico City. Best u talk to someone who has done that
Subject Expert
Allocation funds like the Vanguard Life Strategy funds are extremely hands off and do not require management, and they let you choose a suitable allocation rather than doing a hypothetical, very risky 100% Treasury bond retirement.
Give them a thought.