The U.S. stock market has come a long way from its Great Recession low. That low, at which the S&P 500 bottomed out at 666 on March 9, 2009, is what has been called “the Haines’ bottom,” named after legendary CNBC anchor Mark Haines.
You just retired. Along with a great career, you have built up a substantial 401(k) balance. However, now you need income, not growth.
Diversification is the proverbial don’t put all your eggs in one basket. So while diversification is about the eggs, asset allocation is about the basket.
I would like to give some love to two under-appreciated retirement plans: (1) the Simplified Employee Pension (SEP), and (2) the Solo 401(k). Both are available to any person who generates income from self-employment.
Over the last ten years, however, $1 trillion of investors’ money has moved from active to indexes. A big reason for this is that, over that same period, most active managers have underperformed lower cost-index options.