Making the right moves…

[Himiko]

I will being retiring at the end of September of this year, after which I will rely on my federal retirement. My retirement consists of my federal pension, Social Security, and the federal government Thrift Savings Plan (TSP). I also have three Vanguard IRA’s.
My assets total $880,000 (TSP, 73.9%; Vanguard Long Term Bond, 7.5%; Wellesley Admiral, 9.2%; and REIT Index Admiral, 9.4%).
My TSP savings are currently all in the L-2020 fund. However, since I am retiring this year, I am thinking of taking a more conservative approach and moving it to the L-Income fund and also transfer my Vanguard IRA’s into the L-Income fund as well.
The L-Income fund has an average annual return of about 4.54% (0.38% per month).
At that rate I figure that if I withdraw $6,875 per month that my combined TSP L-Income fund should last me until about 2029, at which time, if I am still around, I will be able to live comfortably off my pension and social security for the duration.
Professional advisors have suggested a little more moderate versus conservative distribution of my assets.
I know there are a lot of you out there with first-hand experience and would appreciate your feedback… am I on the right track or would you suggest something different?
Thank you.

[TBH]

Congratulations on your retirement!

It makes me nervous to think of you spending the funds you control first, leaving yourself with only your pension and your social security for your later years.

If it were me, I'd withdraw a small amount from your TSP and IRAs now so that it won't be all gone by the time you start collecting the other two.

Probably you'll have the pension and social security, but I think it's madness to rely on the government and the voters, who aren't always good shepherds of resources.

As for whether to move your money into a more conservative fund, I'd probably leave have of it in the 2020 fund, which is still pretty conservative, and the other half into the income fund.

[Petunia 100]

I wouldn't go 100% bonds, not at any age. The least risky portfolio is 75% bonds, 25% stocks. Keep a quarter in stocks at least.

Congrats on reaching retirement with a pension and a nice nest egg!

[snafu]

Congratulations on your upcoming retirement. I fully understand your desire to be more conservative with your investments but Income/Bonds go down in value when interest rate are expected to rise and a much better investment in an economy where interest rates are expected to decrease. Further, there is traditionally more likely uptick in equities. You might check out benefits of a low cost, low fee Dividend Fund or ETF.

More importantly, what is your budget going forward? What will happen to your tax rate if you have a major increase in income for the final quarter 2014? There are so many unknown factors. How do you see yourself using time? Will you volunteer? Do you have a hobby or interest that has potential to create income? Are you or DW facing any medical challenges? What large expenses do you see in 2015? Do you have DKs in university? Big trip? newer vehicle, hobby supplies, home updates/upgrades?

[Himiko]

Thank you all for your input.... gives me a lot to think about.
I appreciate it.