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Concerned about older parents making radical change in portfolio

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  • Concerned about older parents making radical change in portfolio

    Just found out that my father (retired physician in his 70s) is planning to pull close to 800k from a diversified vanguard target retirement fund and put it all in a money market fund due to concern for possible coming downturn. He also already took my mother’s savings ~400k and put in vanguard wellsley fund (~58% bonds). They also have a house that is paid off. Obviously their financial situation is very different from my own (just finished residency) since they are both retired (mother is mid 60’s) but they are both in very good health. I’m just concerned that this is not very diversified (especially my fathers) and not protected against inflation. I don’t want to weigh in too much since it’s their money but don’t want to see them make a bad financial decisions.

  • #2
    I may have missed the question but, unfortunately, unless they ask you for advice then I don't think they are looking for your advice. Personal finance is personal. Your father may feel that his asset allocation is currently to risky for their liking. You can certainly try to bring up finances in conversation and you can give your opinion but for the most part, like it or not, it's mainly none of your business. Look on the bright side, there's WAY worse decisions he could be making.

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    • #3
      Sorry I should have clarified: my mother does not know much about finances and wanted my advice to make sure that he is not acting impulsively with their savings. I’m also relatively new to investing so wasn’t sure if this was something concerning and worth discussing with him since he is not receiving any other financial advice.

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      • #4




        my mother does not know much about finances and wanted my advice to make sure that he is not acting impulsively with their savings.
        Click to expand...


        He is. As long as it's not dementia, you probably don't have a say in it. If you have your mother's ear, I'd tell her they could use a financial planner. A good CFP would certainly pay for themselves it sounds like.

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        • #5


          I’m also relatively new to investing so wasn’t sure if this was something concerning and worth discussing with him since he is not receiving any other financial advice.
          Click to expand...


          It's never a great idea to have (at least what appears to be) a significant change in asset allocation. It's tough to give specific recommendations without knowing all the details as well as their goals.

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          • #6


            significant change in asset allocation
            Click to expand...


            Sounds questionable.  Is this all their savings?  What type of account(s)?

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            • #7







              my mother does not know much about finances and wanted my advice to make sure that he is not acting impulsively with their savings.
              Click to expand…


              He is. As long as it’s not dementia, you probably don’t have a say in it. If you have your mother’s ear, I’d tell her they could use a financial planner. A good CFP would certainly pay for themselves it sounds like.
              Click to expand...


              Yes agreed that would avoid OP being the annoying meddling child at least

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              • #8
                Is this all the money they have?

                Isn’t the worst situation, $1.2m, even if invested very conservatively, paid off house, plus a doctor's-salary social security contributions. Unless they have crazy overheard, would imagine they’ll be ok.

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                • #9
                  MYOB

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                  • #10
                    What if you convince him to change back to a more reasonable AA then the market does downturn?   Even if it is the right thing to do he may not realize it and unjustifiably blame you for the misfortune.

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                    • #11
                      Much better to impulsively go from aggressive -> conservative allocation than the other way around. Good thing he realized that the prior allocation was too risky before a downturn rather than after one.

                      There is no way around it though, less risky portfolios have lower returns over time.

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                      • #12




                        Just found out that my father (retired physician in his 70s) is planning to pull close to 800k from a diversified vanguard target retirement fund and put it all in a money market fund due to concern for possible coming downturn. He also already took my mother’s savings ~400k and put in vanguard wellsley fund (~58% bonds). They also have a house that is paid off. Obviously their financial situation is very different from my own (just finished residency) since they are both retired (mother is mid 60’s) but they are both in very good health. I’m just concerned that this is not very diversified (especially my fathers) and not protected against inflation. I don’t want to weigh in too much since it’s their money but don’t want to see them make a bad financial decisions.
                        Click to expand...


                        this sounds perfectly fine - retired 70 yr old who has beaten the game should rebalance during volatile markets.  retirement income funds like wellsley are solid, they're actively managed to try to protect against inflation.  Are you aware that he is anticipating RMD's?

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                        • #13
                          What are their assets and AA?

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                          • #14
                            If this is 10-30% of their net worth, this probably isn’t unreasonable given their age. Need more info from OP.

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