I'm 59 and DW is 50, so in our case we have a potential average retirement of 35 years, which I think is long enough to place the surplus in stocks.Hebell wrote: ↑Mon Jul 25, 2022 4:46 pmOur play money is 15% in equities. Consisting of mostly US stocks. High on techs and agricultural stocks (XT and FARMX plus other sector ETFs). I intend to let it just grow, and not mess with it, unless we reach another grossly overvalued period, and then I'll trim off the froth to bring it back down to 15%.Fremdon Ferndock wrote: ↑Sat Jul 23, 2022 8:59 am An interesting challenge is what to do with your "spare" savings when you feel you've won the game. I have no problem with putting my winnings into bland, boring, low-returning safe investments; i.e., TIPS, I-Bonds, even some Cash. But what to do with the "surplus" - the money I don't think I'll probably even need to spend, at least not unless I have some catastrophic expenses near end-of-life.
Dr. Bernstein and Zvi Bodie both have said you can keep on playing the game with your "play money" if you want -- or not. I've wrestled with this forever. I like the idea of having a chunk of money in risky assets like stocks that I can afford to lose and still be OK for the rest of my life. But lately, I've been asking myself what the heck I'd do with even more money that I don't really need if I end up winning.
It only makes sense to play if I have some beneficial purpose -- it's going to go to charity, people in need, or my family heirs. I decided that's it's not worth gambling with their money either. As long as I'm playing I can't keep myself from continually fussing with how it's invested and watching the stock market like a hawk. So, I'm moving most of my "play money" into safe, boring stuff also. Just put a large chunk into 5-year and 10-year TIPs at auction. Maybe now I can quit obsessing about the stock market and find something more useful to do with my time.
How about you? What are you other "game winners" doing with your surplus? Going for more winnings in stocks, or pulling it all back into safe stuff like I'm doing?
The other option is the following:
Our TIPS ladder funds us until 2052, and the plan is to annuitize the last 10 years worth of rungs to protect from mortality risks. The other option would be to use the excess returns to fund another 10 year worth of rungs, with the idea being the chance that DW and I both make it to 2062 is so ridiculously small that our children will almost for sure get a large chunk of the leftover rungs when we leave for better pastures.