Investing for the Ages Part III of III: 60’s & 70’s and Beyond

In this three-part series, I’ve discussed how to adjust your investment strategy depending on whether you are just getting started in your twenties and thirties or have made steady progress towards saving for retirement in your forties and fifties.

Investing for the Ages: 20’s & 30’s

Investing for the Ages: 40’s & 50’s

If you are in your early sixties, now is the time to shift your investing approach to a more conservative strategy. Without a paycheck to serve as your investment safety net, you will need to create one through your investment program. There are two adjustments that I suggest you consider, and it is a strategy that I call the Growth Strategy with a Safety Net.

Part 1- Safety Net

For the safety net, you should consider investing in enough bonds, bond funds and money market to cover three to ten years of annual lifestyle expenses that are not already (or are expected to be) covered by your Social Security or pension payments. To put it on a scale might look something like this:

  • 10 years or more = conservative
  • 5-9 years = moderate
  • 3-4 years = aggressive

Clearly, in today’s environment, nothing in fixed income is paying much in the way of interest. Still, the purpose of this safety net is to keep you from having to sell stocks when they are temporarily depressed due to a bear market. Historically, there is a significant market correction or bear market every three to five years, and the average time it takes the market to recover is fourteen months. To get to that 14-month average, you will have bear markets that take 4-5 years (2008, 2001). So you decide how many years your safety net should cover.

Part 2- Growth Strategy

For the growth part of your portfolio, we will continue to recommend stocks, but now we would like to shift from more growth-oriented stocks to U.S. large-cap dividend-paying companies…more value-oriented. The key is building a diversified basket of at least twenty stocks that have a long-term history of both paying and raising their dividends. It is the consistency of the dividends that will tend to reduce the volatility of the stock portfolio during market downturns.

At this point, unless you are a highly experienced investor and financial manager, it is important to seek professional help from a Certified Financial Planner who can do both a detailed retirement analysis and help you plan and manage your investment strategy.

One final point

It takes a lot of money to replace a paycheck for twenty, thirty years or more. Depending on the amount of Social Security and pension available to you, you will need an investment account equal to ten-to-twenty times your annual expenses. If you expect to spend $100,000 per year, you will need $1 million to $2 million or more of investments.



Investing for the Ages Part III of III: 60’s & 70’s

  • Money Market/bond allocation = 3-10 years of annual expenses
    • 10 years-plus = conservative
    • 5-9 years = moderate
    • 3-4 years = aggressive
  • Use more conservative stocks…value vs. growth
  • U.S. large-cap; dividend-paying companies
  • Get help from a CFP


Stewart H. Welch, III, CFP, AEP, is the founder of THE WELCH GROUP, LLC, which specializes in providing fee-only investment management and financial advice to families throughout the United States. He is the author or co-author of six books, including  J.K. Lasser’s New Rules for Estate, Retirement and Tax Planning- 6th Edition (John Wiley & Sons, Inc.); THINK Like a Self-Made Millionaireand 100 Tips for Creating a Champagne Retirement on a Shoestring Budget.



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