Should I Switch My Bond Portfolio to CDs?

If you are getting close to retirement you have probably been watching the financial news to help you stay up to date with what is going on in the world. If so, you won’t want to miss out on hearing why this is not a good idea. 

Today, I’ll also answer questions about bonds, charitable gifting, and how to find a financial advisor. Make sure to stick around until the end to hear about upcoming changes to Medicare with, Medicare expert, Danielle Roberts from Boomer Benefits. 

Keeping up with the news won't help you navigate your way through retirement

Have you read the news lately? It’s not pretty out there. Inflation, bear markets, rising interest rates, political craziness, a poor economy: it’s non-stop fear peddled 24-7. Staying up with the news will not help you navigate your retirement journey. Trying to stay on top of the news will only bring you more stress and worry.

You're not going to weather this bear market by keeping up with the headlines. Instead, you’ll navigate it by getting to the bottom of things, relaxing, using a process, and making a judgment call. If you are interested in the process that we teach, join one of our live meetups on October 27 or 29. Register at LiveWithRoger.com

Should I switch my bond portfolio to CDs?

When choosing which type of investments to own it is crucial to use a process and consider what the money will be used for. You’ll need to ensure that you have an emergency fund and 5 years of prefunded consumption before building your long-term income floor.

You can prefund your first 5 years of consumption with individual assets that mature when you need them by using CDs, treasury bills, Treasury Inflation-Protected Security (TIPS), MYA-guaranteed annuities, or individual bonds. Build this income floor by creating an income ladder that matures at the time you will need to use it. The current market is a good example of why you wouldn’t want to use stocks and bond funds for these first 5 years of cash on hand. 

Beyond the first 5 years, you’ll build a portfolio that contains a mix of stocks and bonds. At this point, rather than buying individual bonds you may want to purchase ETFs and managed index bonds. This way, as interest rates rise, the funds get reinvested back into your portfolio. 

By ensuring that you won’t need these funds for 5+ years, you don’t have to worry about the markets or rising interest rates. 

Look out for these upcoming changes to Medicare

Medicare’s annual open enrollment period is coming up soon, so Danielle Roberts joins me to discuss the real and potential changes coming to this essential benefit. Listen in to learn about the crucial difference between the annual open enrollment period and the one-time-only initial enrollment period that occurs when you turn 65. 

You’ll also hear about how recent legislation will change drug coverage for many common drugs. Danielle offers a wealth of information, so you won’t want to miss out on her expertise. Stick around until the end to hear her take on what is happening in Medicare news. 

OUTLINE OF THIS EPISODE OF THE RETIREMENT ANSWER MAN

PRACTICAL PLANNING SEGMENT

• [2:11] Staying on top of the news will only bring you more stress and worry

LISTENER QUESTIONS

• [7:23] Should I switch my bond portfolio to CDs?
• [12:07] What to use for your middle bucket
• [13:48] On using charitable gift annuities in retirement planning
• [17:27] How to find a financial advisor to help plan retirement
• [21:44] Should taxable and tax-free assets be weighted differently on a net worth statement?

MEDICARE NEWS WITH DANIELLE ROBERTS FROM BOOMER BENEFITS

• [24:53] Changes to Medicare to look out for
• [37:30] What to look out for in your mailbox
• [45:35] Potential changes upcoming in 2023

TODAY’S SMART SPRINT SEGMENT

• [47:20] Stop trying to stay on top of things

Resources Mentioned In This Episode

LiveWithRoger.com - Make sure to secure your spot for the live event on October 27 or 29!

Boomer Benefits

RetireAgile.com

NAPFA.org can help you find a fee-only, fiduciary financial advisor

Rock Retirement Club

Roger’s YouTube Channel - Roger That

BOOK - Rock Retirement  by Roger Whitney

Roger’s Retirement Learning Center