Is My Retirement Portfolio Too Risky?
Risk Management: Investing for Retirement, and Focus on Risk Above Returns
Clients: Bill (65) and Melinda Gates (62) have been married for over 34 years and have a 24-year-old son now working (for Morgan Stanley), and two other children still in college. Bill is a Bitcoin executive, and Melinda works for a local San Francisco Art Gallery, and they are “sophisticated” investors and actively manage their investment portfolios and retirement plans (401k, pensions, and IRAs).
Additional Questions: How We Helped the Client?
How does Bill & Melinda balance their risk and return at this stage of their life?
Should they focus on income-generating investments, with principal protection?
What role should bonds and dividend-paying stocks play in their portfolios?
How often should they rebalance my portfolios? Monthly, quarterly, or as needed?
How can they protect themselves against major market downturns?
Our Solution: We put together a: (1) Risk Analysis of all their portfolios, to determine if their personal or family RTS ("risk tolerance score," matches their portfolio RS ("risk score"); (2) Financial Plan to ensure that Bill and Melinda are maximizing their investment portfolio returns and have an acceptable level of risk; and (3) an Estate Planning cash flow worksheet, so that they know exactly how much they can gift their children.