We have been living off our portfolio since late 2012 (~11 years.)

Life has evolved substantially in that time – we started as 2 carefree kids exploring the globe. Now we have 2 carefree kids and live in the suburbs.

Our core portfolio, on the other hand, has remained largely consistent… with the exception of adding a significant real-estate component (our house.)

I’ve updated some charts and created some new ones so we can all see what happened.

GCC Asset Allocation

As of late June 2023, our portfolio looks like this (chart from Empower.)

Assets and Allocation

The portfolio continues to be heavy on equities and light on bonds and cash, although I’ve recently increased our cash/short-term bond holdings (more on that later.)

Here is the breakdown:

US Stocks:  75% -> mostly VTI with some S&P500 and Small-cap trusts in my old 401k
International Stocks: 16% -> 100% VXUS
Bonds: 5% -> intermediate term Treasuries (IEI), very short term treasuries (individual), and I-bonds (included in this chart for the first time)
Alternatives: 4% -> 100% VNQ (a REIT) and REIT holdings as part of VTI (e.g. equities)
Cash: 1%

Some interesting ratios:
Stock / Bonds-Cash: ~ 94 / 6 (trending away from 100% equities)
US / International equities: ~ 82 / 18
Taxable / Pre / Post-tax: ~ 57 / 35 / 9 (Roth is trending up – was 0% 10 years ago)

Data from previous years: 20162018201920202021, 2022.

What is new this year

Our cash and US bond holdings have increased by 3-4%, and the US/International stock allocation has skewed towards the US as markets here rose.

Bonds/cash increased because our regular cash flow is higher from a smaller portfolio – I wanted a cash buffer and not be forced to sell stock if the market dropped. With short-term Treasury rates at ~5% it made sense to park those funds there.

I also parked some funds from our mortgage investment experiment into I-bonds when those rates were nearly 10%.

Overall pretty minor stuff.

Changes over time

The portfolio snapshot from Empower is super helpful, offering a lot of insights at a single glance. I use it for easy rebalancing guidance…

The one thing it doesn’t show is changes over time, which really shouldn’t happen if you are rebalancing regularly… but if you do something untoward like trade some big gains for a house or increase bond allocation because interest rates jumped, well then it helps to see those changes visually.

As such, I also created some of my own charts. (Also because I like Excel a bit more than is rational.)

That same chart but in dollars (not inflation adjusted) rather than percentages

I don’t include home value in these charts because I don’t include equity in our retirement portfolio for purposes of the 4% Rule. However, seeing real assets (house, car, boat, aircraft, etc… minus debt) as part of the mix is interesting for many, so I made those charts this year as well (using Zillow valuations, which… probably optimistic.)

Some interesting data points:

  • Even though we bought a house, our investment portfolio is worth more now than it was when we “retired” (not adjusted for inflation)
  • Despite market behavior of the past few years, the trend is still up. Better than the alternative.

Other assets

Rewards Points

Not a traditional asset class, but something with real value.

Alaska Airlines: 166,940 miles
Amex: 0
Capital One: 0
Citi: 167,221
Delta Airlines: 17,274
Hilton: 27,051
IHG: 283.275
Marriott/SPG: 129,613
Ultimate Rewards: 230,430 (after recently booking $4,300 flights to Taiwan)
United Airlines: 12,429
Total value: $13,670+

We just got back from 2 weeks in Hawaii and will visit friends/family in Taiwan this winter, with rewards points covering most/all of the big expenses. I am currently working on spring break 2024 plans.

For the how and why of earning and spending rewards points, see: Introduction to Travel Hacking – Award Travel Series.

Crypto

If you enjoying owning things that have no intrinsic value, maybe you have some crypto. We do.

Some time ago I got $5 in free bitcoin from Paypal. This is included in the above charts but difficult to see, so I wanted to call it out specifically.

This is now worth $3.22, about $0.07 more than it was when I checked last year.

I also created my own coin – our holdings are worth a bit over $1 trillion dollars because I say so. This is NOT included in the above charts because it blows up the y-axis.

Social Security

At this point I am about 15 years away from being able to collect Social Security.

That has measurable impact on portfolio value today, as much as $750,000. That much cheese is kinda hard to ignore.

If the past few years of sideways / roller coaster markets has got you down, be sure to read that post for a breath of fresh air.

Summary

As homeowners we have a bit higher cash flow needs than we did as renters. With short term interest rates at 5%+ levels I sold some stock and parked cash in short term Treasuries. The rest of the portfolio is much the same as it has always been.


You can’t go wrong tracking your portfolio with Empower (affiliate link)