What concepts can I use to guide the allocation of assets in my portfolio?

I am 65 years old. I have $1,500,000 from divorce proceedings. What concepts can I use to guide the allocation of my assets in my portfolio?

Marriage / Divorce, Financial Planning, Asset Allocation
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2 weeks ago
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I generally address this question by asking a client to provide their annual budget.  What will it cost you, per year, to live?  I don't mean just the basic food, shelter, utilities, taxes, etc.; I also ask for what you will spend on travel, entertainment, meals, hobbies, gifts and the other pleasures of life.  Then, add something for emergencies (a new car, a new roof, an accident or illness) knowing that those will not occur every year, but can be large when they do occur.

Then, take that number and subtract all income from all sources -- your Social Security (which you should possibly wait to take until you turn 67); your spouse's, if applicable; any other pension income or retirement assets.  The result is the amount you will need to take from your investments every year.  At this point your primary goal is to make sure that whatever happens in the capital markets, you will have enough to sustain you for the rest of your life.  There are general rules-of-thumb for this -- you probably can stay solvent over the long term by taking $60,000 or less per year, I would think -- but no hard-and-fast rule that applies to everyone.  Those of us responding to you don't know, for example, whether you might expect to receive an inheritance some time in the future; and you have not stated what other savings you have.  So that number could grow.

If you have any questions, feel free to get in touch. 

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