I was never enthusiastic about buckets. It's more complicated to implement and execute.
I concentrate on total portfolio Sharp ratio = risk-adjusted returns.
The easiest is to keep a constant AA (asset allocation) of bonds + stocks using allocation funds. For the buy and hold for decades or in order to make my wife's investment decisions easier, I set up a written plan for her to invest in only 3 funds. I only trust 2 choices indexes + Vanguard funds managed by Wellington for long term hold. Wellington Management is the oldest, it's conservative, team style, and not one dominant manager, with a very cheap expense ratio. Since our money isn't with Vanguard, we would have to own the more expensive funds (not Admiral), but it's still cheap.For a younger age, until age 75 and still having a taxable account...50% VWINX(40/60)...taxable=20% VWAHX(HY Muni)...30% VSMGX (60/40 invested in 2 US + 2 international indexes). Since HY Muni bonds are hybrid, this portfolio is more like 40/60.Older than 75 or taxable account is gone: 40% VWINX(40/60)...30% VWEHX(HY Corp)...30% VSMGX(60/40). Since HY Corp bonds are hybrid, this portfolio is more like 35/65(stocks/bonds).==================Another good choice is to own up to 5 funds, maybe 3 indexes and 2 managed funds, each fund is all bonds or stocks. To maintain your target asset allocation and generate cash for expenses, consider selling shares of the fund that has appreciated the most over the previous 3–6 months. This naturally trims your winners, helps control risk, and can keep the portfolio closer to its desired allocation without requiring frequent trading.
The beauty of this approach is its simplicity: a small number of funds, minimal maintenance, and a disciplined rebalancing process. ==================As long as I'm managing the portfolio, I will be using my style, which is unique bond funds, trading every several months, and avoiding market meltdowns. Since retirement in 2018, I have achieved 11.7% annually using only bond funds, which equals a Sharpe Ratio > 3.
I have a friend who is a professor of economics and accounting. He has told me several times that economists are worse than weather forecasters.
I’ve been tracking economists’ predictions for decades, and in my view their forecasting record has often been disappointing.
Every time I see an article begin with ‘Economists say...,’ I tend to smile and become skeptical.
I also think that personal or political viewpoints can sometimes influence economic analysis, which is another reason I view many predictions with caution.
Holding mainly SPY or VOO makes sense—you’re essentially betting on the strongest capitalism in the world and riding momentum investing. SPY naturally allocates more to the best-performing stocks. Bonds, however, are a different story. Over the last 5, 10, and 15 years, BND returned roughly 0%, 1.5%, and 2.2% annually—trailing inflation. Many high-rated bond indexes are like planes without pilots, since managers can’t adjust the portfolio for changing market conditions. That’s why I’ve never held high-rated bond funds directly. Hint 1: Stocks are easy—stick to indexes. Bonds are where you can truly add value. Look for funds with strong Sharpe ratios and solid absolute performance—that’s how you find well-managed bond funds. Hint 2: Always consider unique local and global factors. Anyone who didn’t sell in early 2022 didn’t understand basic investing. After the highest inflation in over four decades, the Fed was loud and clear: rates were going up fast.
You need to be at least a little tech-savvy in today’s world and willing to do some research.
First, you need internet access.
Local cable internet prices usually range from about $40 to $60+ per month. For most households, 300–500 Mbps is more than enough. Let’s assume $60.
Second, YouTube TV is probably the best live TV streaming service overall. Let’s assume about $90 per month. You can record countless hours of content, watch on multiple TVs, start a show on one TV and continue on another, and you don’t pay extra based on the number of TVs in the house.
Third, your TVs need to support streaming, either directly or through devices like Amazon Fire TV Stick or Roku devices.
If your Wi-Fi network is solid — at least 50 Mbps throughout the house — you’re basically done.
If not, you may need a Wi-Fi extender or a better home network setup.
The streaming devices and extenders are mostly one-time purchases.
So your ongoing monthly cost is roughly:
Internet: $60
YouTube TV: $90
Total: about $150 per month.
Anything beyond that adds extra cost.
Netflix is almost a must these days. We also get Amazon benefits through Prime.
For everything else, I wait for deals. Last Black Friday, for example, I got HBO for $2.99 per month for a full year.
I’m also aggressive about negotiating. I originally got 500 Mbps internet for $40 per month for three years. When the promo ended, the price jumped to $54. I kept calling and threatening to cancel, and eventually got it back down to $40.
I also share YouTube TV and Amazon with my brother-in-law and split the cost.
Overall, these prices are still far better than traditional cable packages. You just have to learn some new tricks. It took my wife about 3–4 days to fully get used to the streaming setup.
LTC is a bad idea in most cases.
It's expensive with loopholes you will find later.
When I retired I dedicated an imaginary $500K of my total portfolio for it but invested it as normal.
My portfolio more than doubled.
You can absolutely do both. A friend of mine invested $3K in each of 10 companies back in 1990. Nine of them didn’t do much, but one—Microsoft—grew to over $1.5 million. The rest of the money he invested in the SP500 thru his 401K for many years.
It’s like having your cake and eating it too.
VGSH isn't a practical idea.
In the last 15 years it made 1.4% annually.
Inflation was about twice than that. Another myth is income investing.
There is no such thing as income investing.
The best way to test your portfolio is total performance which includes everything.
Many investors, including me, prefer risk-adjusted returns.
Just because a security has 4% distribution, it doesn't guarantee better performance or better risk-adjusted returns.
The main issue in this country is over spending and under saving.
I know people who make from $50K and all the way to $150K with this problem. Most of them know they spend too much but refuse to lower their spendings and save for retirement.
Most Americans who bought a house decades ago are better financially now.
Paying your mortgage forces you to save and be more responsible.
The future will be similar because it's mostly a behavioral issue.
Of course being good with money and buying at the right time help a lot.
+1
I have never made a budget, and never tracked our expenses because if we were able to save by investing in our 401K, and pay all our bills in time, I don't need to do that.
Our bank and discount broker have all this information too.
On the other hand all the people I know that have done that have much smaller portfolio.
The conclusion: people who know how to save, invest and handle money intuitively can do just fine.
Comments
I was never enthusiastic about buckets. It's more complicated to implement and execute. I concentrate on total portfolio Sharp ratio = risk-adjusted returns. The easiest is to keep a constant AA (asset allocation) of bonds + stocks using allocation funds. For the buy and hold for decades or in order to make my wife's investment decisions easier, I set up a written plan for her to invest in only 3 funds. I only trust 2 choices indexes + Vanguard funds managed by Wellington for long term hold. Wellington Management is the oldest, it's conservative, team style, and not one dominant manager, with a very cheap expense ratio. Since our money isn't with Vanguard, we would have to own the more expensive funds (not Admiral), but it's still cheap. For a younger age, until age 75 and still having a taxable account...50% VWINX(40/60)...taxable=20% VWAHX(HY Muni)...30% VSMGX (60/40 invested in 2 US + 2 international indexes). Since HY Muni bonds are hybrid, this portfolio is more like 40/60. Older than 75 or taxable account is gone: 40% VWINX(40/60)...30% VWEHX(HY Corp)...30% VSMGX(60/40). Since HY Corp bonds are hybrid, this portfolio is more like 35/65(stocks/bonds). ================== Another good choice is to own up to 5 funds, maybe 3 indexes and 2 managed funds, each fund is all bonds or stocks. To maintain your target asset allocation and generate cash for expenses, consider selling shares of the fund that has appreciated the most over the previous 3–6 months. This naturally trims your winners, helps control risk, and can keep the portfolio closer to its desired allocation without requiring frequent trading. The beauty of this approach is its simplicity: a small number of funds, minimal maintenance, and a disciplined rebalancing process. ================== As long as I'm managing the portfolio, I will be using my style, which is unique bond funds, trading every several months, and avoiding market meltdowns. Since retirement in 2018, I have achieved 11.7% annually using only bond funds, which equals a Sharpe Ratio > 3.
Post: Bucket Strategy
Link to comment from June 7, 2026
I have a friend who is a professor of economics and accounting. He has told me several times that economists are worse than weather forecasters. I’ve been tracking economists’ predictions for decades, and in my view their forecasting record has often been disappointing. Every time I see an article begin with ‘Economists say...,’ I tend to smile and become skeptical. I also think that personal or political viewpoints can sometimes influence economic analysis, which is another reason I view many predictions with caution.
Post: Inflation and Innovation
Link to comment from May 25, 2026
Holding mainly SPY or VOO makes sense—you’re essentially betting on the strongest capitalism in the world and riding momentum investing. SPY naturally allocates more to the best-performing stocks. Bonds, however, are a different story. Over the last 5, 10, and 15 years, BND returned roughly 0%, 1.5%, and 2.2% annually—trailing inflation. Many high-rated bond indexes are like planes without pilots, since managers can’t adjust the portfolio for changing market conditions. That’s why I’ve never held high-rated bond funds directly. Hint 1: Stocks are easy—stick to indexes. Bonds are where you can truly add value. Look for funds with strong Sharpe ratios and solid absolute performance—that’s how you find well-managed bond funds. Hint 2: Always consider unique local and global factors. Anyone who didn’t sell in early 2022 didn’t understand basic investing. After the highest inflation in over four decades, the Fed was loud and clear: rates were going up fast.
Post: Resilient Investing
Link to comment from May 18, 2026
You need to be at least a little tech-savvy in today’s world and willing to do some research. First, you need internet access. Local cable internet prices usually range from about $40 to $60+ per month. For most households, 300–500 Mbps is more than enough. Let’s assume $60. Second, YouTube TV is probably the best live TV streaming service overall. Let’s assume about $90 per month. You can record countless hours of content, watch on multiple TVs, start a show on one TV and continue on another, and you don’t pay extra based on the number of TVs in the house. Third, your TVs need to support streaming, either directly or through devices like Amazon Fire TV Stick or Roku devices. If your Wi-Fi network is solid — at least 50 Mbps throughout the house — you’re basically done. If not, you may need a Wi-Fi extender or a better home network setup. The streaming devices and extenders are mostly one-time purchases. So your ongoing monthly cost is roughly:
- Internet: $60
- YouTube TV: $90
Total: about $150 per month. Anything beyond that adds extra cost. Netflix is almost a must these days. We also get Amazon benefits through Prime. For everything else, I wait for deals. Last Black Friday, for example, I got HBO for $2.99 per month for a full year. I’m also aggressive about negotiating. I originally got 500 Mbps internet for $40 per month for three years. When the promo ended, the price jumped to $54. I kept calling and threatening to cancel, and eventually got it back down to $40. I also share YouTube TV and Amazon with my brother-in-law and split the cost. Overall, these prices are still far better than traditional cable packages. You just have to learn some new tricks. It took my wife about 3–4 days to fully get used to the streaming setup.Post: Living On Autopilot
Link to comment from May 9, 2026
LTC is a bad idea in most cases. It's expensive with loopholes you will find later. When I retired I dedicated an imaginary $500K of my total portfolio for it but invested it as normal. My portfolio more than doubled.
Post: Long Term Care
Link to comment from May 9, 2026
You can absolutely do both. A friend of mine invested $3K in each of 10 companies back in 1990. Nine of them didn’t do much, but one—Microsoft—grew to over $1.5 million. The rest of the money he invested in the SP500 thru his 401K for many years. It’s like having your cake and eating it too.
Post: Driving Prices
Link to comment from April 25, 2026
VGSH isn't a practical idea. In the last 15 years it made 1.4% annually. Inflation was about twice than that. Another myth is income investing. There is no such thing as income investing. The best way to test your portfolio is total performance which includes everything. Many investors, including me, prefer risk-adjusted returns. Just because a security has 4% distribution, it doesn't guarantee better performance or better risk-adjusted returns.
Post: Staying Rational
Link to comment from April 18, 2026
The main issue in this country is over spending and under saving. I know people who make from $50K and all the way to $150K with this problem. Most of them know they spend too much but refuse to lower their spendings and save for retirement.
Post: “We did everything right.” Maybe not. Retirement income should not be an unpleasant surprise.
Link to comment from April 11, 2026
Most Americans who bought a house decades ago are better financially now. Paying your mortgage forces you to save and be more responsible. The future will be similar because it's mostly a behavioral issue. Of course being good with money and buying at the right time help a lot.
Post: The Home Ownership Gamble
Link to comment from April 11, 2026
+1 I have never made a budget, and never tracked our expenses because if we were able to save by investing in our 401K, and pay all our bills in time, I don't need to do that. Our bank and discount broker have all this information too. On the other hand all the people I know that have done that have much smaller portfolio. The conclusion: people who know how to save, invest and handle money intuitively can do just fine.
Post: Nothing Like a War To Bring Folks around to Personal Financial Planning
Link to comment from April 11, 2026