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Investment Portfolio for a 90-Year-Old

At 90, the primary goal for your investment portfolio is typically to maintain capital and generate reliable income to cover living expenses. Growth is less of a priority than preserving your nest egg and ensuring funds are available when needed. Risk tolerance should be very low.

Key Considerations

Income Generation: Focus on investments that provide steady income streams.
Capital Preservation: Protect your savings from significant losses.
Liquidity: Ensure easy access to funds when required.
Longevity Risk: Planning for the possibility of a longer-than-expected lifespan.
Inflation Protection: Some protection against the rising cost of living is desirable, but secondary to safety.

Suggested Asset Allocation

This is a general guideline and should be adjusted based on your individual circumstances, financial needs, and risk tolerance. Consult with a qualified financial advisor for personalized advice.

High-Yield Savings Accounts/Certificates of Deposit (CDs): 30-40%. Provides safety and liquidity. CDs offer slightly higher yields but lock up your money for a specified period.
Government Bonds/Bond Funds: 30-40%. Invest in U.S. Treasury bonds or high-quality municipal bonds. Bond funds offer diversification. Focus on short to intermediate-term maturities to minimize interest rate risk.
Dividend-Paying Stocks (Blue-Chip): 10-20%. Select well-established, large-cap companies with a history of consistent dividend payments. Limit exposure to manage risk. Consider a low-cost dividend-focused ETF.
Real Estate Investment Trusts (REITs): 0-10%. REITs offer potential income and some inflation protection, but are more volatile than bonds. A small allocation can be considered, but carefully evaluated.

Important Notes

Minimize Fees: Choose low-cost investment options such as index funds and ETFs.
Regular Withdrawals: Establish a sustainable withdrawal strategy to meet your income needs. Work with a financial advisor to determine a safe withdrawal rate.
Review and Adjust: Regularly review your portfolio (at least annually) and make adjustments as needed based on your changing circumstances and market conditions.
Professional Advice: It’s highly recommended to work with a qualified financial advisor who understands the needs of retirees and can provide personalized guidance.
Tax Implications: Be mindful of the tax implications of your investment decisions. Consider strategies to minimize taxes, such as tax-advantaged accounts.

Disclaimer: This information is for general educational purposes only and should not be considered investment advice. Investment decisions should be made based on your own due diligence and consultation with a qualified financial professional.

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