From Dow Jones & Company:
A 76-year-old widow wonders if it’s still best to split investments 50/50 in stocks and bonds. She has $73,000 in investments and $20,000 in a high-yield savings account. Her Social Security and small pensions give her a monthly income of $3,400. Her investments have remained around $73,000 for the past two years, in spite of the $100 a month she’s invested. She is considering different options and asks for advice on diversifying investments.
Financial experts advise the widow to do a check-up on her asset allocation and deep dive into her stocks and bonds. She is also advised to consider asset and liability checkups, and how much she spends in a given year. The article also mentions risk tolerance and risk capacity as important factors to consider, as well as the importance of having a plan to keep financially afloat and comfortable.
Experts suggest consulting a qualified and trustworthy financial planner to walk through specific investment options and create a more customized asset allocation. The widow is also advised to have a separate investment account and contribute a small portion of her excess income every month, choosing a higher allocation toward stocks. Overall, the piece emphasizes the importance of thoughtful planning and consideration for long-term financial health, especially at the age of 76.
Read more: I’m 76 with $73,000 in an investment account that has not increased in 2 years. Should I abandon the 50/50 strategy?