Risk Parity Radio
Risk Parity Radio is a podcast about investing located at www.riskparityradio.com. RPR explores risk-parity style portfolios comprised of uncorrelated or negatively correlated asset classes -- stocks, selected bonds, gold, managed futures, and other easily accessible fund options for the DIY investor. The goal is to construct portfolios that are robust and can be drawn down on in perpetuity, and to maximize projected Safe Withdrawal Rates regardless of projected overall returns.
Risk Parity Radio
Episode 454: A Master Plan For Mr. Bill And Portfolio Reviews As Of September 12, 2025
In this episode we answer one big long email from Mr. Bill (actually Dr. Bill). We discuss a planning process grounded in good data science, forecasting techniques and decision theory, and how we incorporate the concepts described in Bill Bengen's new book, using Dr. Bill as our guinea pig.
And THEN we our go through our weekly portfolio reviews of the eight sample portfolios you can find at Portfolios | Risk Parity Radio.
Additional Links:
Father McKenna Center Donation Page: Donate - Father McKenna Center
Risk Savvy Lecture: Risk Savvy: How to Make Good Decisions
Bill Bengen's New Book: Bill Bengen's New Book | A Richer Retirement: Supercharging the 4% Rule to Spend More and Enjoy More.
Portfolio Charts Safe Withdrawal Rate Calculator: Withdrawal Rates – Portfolio Charts
Breathless Unedited AI-Bot Summary:
Retirement planning doesn't have to be rocket science. In this illuminating episode, we dive deep into the transition from accumulation to distribution phases of financial independence, offering a clear-eyed approach based on data science and practical wisdom.
At the heart of effective retirement planning lies proper forecasting methodology. Most financial advisors miss this crucial foundation – they load forecasts with conservative assumptions rather than using base rates, creating unnecessarily fearful projections. We explore why understanding the difference between risk (what's calculable) and uncertainty (what isn't) transforms how you should approach planning for the decades ahead.
The four levers that control your retirement success form our central framework: supplemental income, asset selection, flexible withdrawals, and fear/hoarding. Each lever offers unique opportunities to optimize your financial independence. Risk parity portfolios consistently demonstrate 1-2% higher safe withdrawal rates than traditional portfolios, while simply accounting for retirees' typical lower inflation experience (CPI minus 1-2%) can safely increase withdrawal rates by 0.5-1%.
We tackle the psychological aspects of retirement planning too. Most retirees underspend significantly, pulling the "fear and hoarding" lever while ignoring the other three, ultimately sacrificing quality of life and relationships. Instead, we advocate for thoughtful legacy planning while alive – supporting family members, teaching financial literacy, and creating meaningful impact with your resources.
Whether you're approaching retirement or already there, this episode offers practical wisdom to simplify your planning process. By focusing on tracking expenses meticulously in the early years and using simple rules of thumb for long-term forecasting, you'll create a retirement plan that maximizes both financial security and life satisfaction.
A foolish consistency, is the hobgoblin of little minds, adored by little statesmen and philosophers and divines.
Mostly Queen Mary:If a man does not keep pace with his companions.
Voices:Perhaps it is because he hears a different drummer, a different drummer.
Mostly Queen Mary:And now, coming to you from dead center on your dial, welcome to Risk Parity Radio, where we explore alternatives and asset allocations for the do-it-yourself investor, Broadcasting to you now from the comfort of his easy chair. Here is your host, Frank Vasquez.
Mostly Uncle Frank:Thank you, mary, and welcome to Risk Parity Radio. If you have just stumbled in here, you will find that this podcast is kind of like a dive bar of personal finance and do-it-yourself investing. It's a relatively small place. It's just me and Mary in here and we only have a few mismatched bar stools and some easy chairs. We have no sponsors, we have no guests and we have no expansion plans.
Voices:I don't think I'd like another job.
Mostly Uncle Frank:What we do have is a little free library of updated and unconflicted information for do-it-yourself investors.
Voices:Now who's up for a trip to the library?
Mostly Uncle Frank:tomorrow. So please enjoy our mostly cold beer served in cans and our coffee served in old, chipped and cracked mugs, along with what our little free library has to offer.
Voices:Welcome offer.
Mostly Uncle Frank:But now onward to episode 454. Today on Risk Parity Radio it's time for the grand unveiling of money which means we'll be doing our weekly portfolio reviews of the eight sample portfolios you can find at wwwriskpartnercom on the portfolios page. But before we get to that we're going to have one big long email. Surely you can't be serious. I am serious and don't call me Shirley From friend of the show, bill Yount, who runs the Catching Up to Five podcast.
Voices:Looks like I picked the wrong week to quit amphetamines.
Mostly Uncle Frank:And is also a donor to the Father McKenna Center, which has moved him to the front of the line. As most of you know, we do not have any sponsors on this program. We do have a charity we support. It's called the Father McKenna Center and it supports hungry and homeless people in Washington DC. Full disclosure I am on the board of the charity and am the current treasurer, but if you give to the charity, you get to go to the front of the email line on this program.
Voices:Excellent.
Mostly Uncle Frank:And that's like a two and a half month long line. Right now there are two ways to give to the charity. Either you can do it directly on the donation page of the Father McKenna Center website, or you can become a patron on Patreon, and you do that at the Risk Party Radio website, wwwriskpartyradiocom, and follow the links there, and you can become a monthly donor that way. Either way, you get to go to the front of the email line, but make sure you mention that in your email so I can duly move you to the front of the line.
Voices:And now, without further ado, here I go once again with the email.
Mostly Uncle Frank:And First off, second off, last off, first, second and last off of an email from Bill.
Voices:Oh, hey, everybody, it's me, mr Bill, and I'm on the way to the studio to take my new show. Oh, no, mr Bill presents. Hey, hey, everybody, it's me, mr Bill, and I'm on the way to the studio to take my new show. Oh no, mr Bill presents.
Mostly Uncle Frank:That's Dr Bill to you.
Voices:What am I? A doctor or a moonshuttle conductor?
Mostly Queen Mary:And Bill writes Frank, I have been deep diving on transitioning from an accumulation plan to a retirement distribution plan.
Voices:Hey kids, it's time for Mr Bill's Safety Tips. And here's the star of the show, one of the unluckiest people in the world. Mr Bill Spock, you should know better than to play with matches, because they're very dangerous. No, no, wait, do it. They're very dangerous.
Mostly Queen Mary:Extremely grateful for your expert guidance, friendship and mentorship on life in general and using contrarian high-level personal finance and money wisdom to maximize our only renewable resource time.
Voices:Speaking of suffocating.
Mostly Queen Mary:Freedom to do what we want, when we want, with whom we want, and give back with.
Voices:Red Hot Chili.
Mostly Queen Mary:Pepper. 5. Back to binging your podcast, catching up and deep diving on plans for transition to pre-retirement, 80% of financial independence at market highs, planning a risk parity style portfolio using a blend of Bill Bangan's latest research, your principles of risk parity, portfolio construction and, for various reasons, behavior gap, blind spots, lack of interest in DIY with focus on living life without managing money, insurance against cognitive decline and protecting my wife if I reach end of plan before her. She has no interest in money management and just wants to have the money there, show up and spend it.
Voices:Show me the money. I need to feel you, jerry, show me the money. Jerry, you better yell, show me the money, jerry, you better yell, show me the money.
Mostly Queen Mary:I will probably partner with a CFP and CFA with 10 years of experience in billions of dollars of institutional portfolio construction and wealth management and a holistic flat-fee life planner and financial advisor I found online who happens to use total return risk parity style portfolios in his practice. That's what I'm talking about. I don't know if you have gone over Bengen's new book Research Process to Reach an Investor's Personal Safe Max, but it might be a useful exercise for your listeners to do so. Using my inputs Selfishly, I seek feedback on my roughed out plan. Bengen's elements One withdrawal scheme, variable retirement smile front and back loaded cola CPI minus one to 2% for personal inflation and increasing equity glide path after sequence risk behind us. Two planning horizon Semi-retirement at 63 and full retirement at 65 with a 30 to 35 year estimated longevity. Three portfolio tax status Combination of pre-tax and taxable withdrawals. Approximately two to one split Will to protect and grow Roth's 10% of portfolio as able for legacy or use a perpetual withdrawal rate. Four Legacy Wish to give money with retirement cash flow budget to kids and charity as able Roth funding split house down payment, grandkids college fund, daf. Slash QCDs and hope to leave a reasonable portfolio legacy about 33% of starting portfolio value. We'll use decreasing, eliminating legacy as a buffer for sequence risk or adjustments to plan if likelihood of success falls below 70%. We'll spend more if likelihood of success exceeds 90%. Five asset allocation I wish to use a 60-40 growth tilted or mildly leveraged, less equity tilted, heavy portfolio, possibly consisting of something like this 25% VUG, 20% AVUV, 10% IDMO, 5% AVDV, 10% GLDM, 15% VGIT or VGLT, 10% DBMF, 5% cash. I'm open to suggestions or feedback here based on your backtesting.
Mostly Queen Mary:6. Portfolio rebalancing Guyton Clinger Bands, quarterly assessed or annually on July 4th. 7. Average passive returns of portfolio accepted no market timing performance yield chasing behavior gap between investment portfolio performance. 8. With withdrawal timing Monthly on the first of the month to mimic paycheck and reverse dollar cost averaging. I would add to these a ninth element of monitoring our portfolio's performance drawdown strategy and real versus planned spending, quarterly or annually at year's end.
Mostly Queen Mary:What method do you use? I am thinking of using bands on a critical path of liability matching, fundedness-based Monte Carlo analysis of likelihood of success, as mentioned above, with the 90% top line band and 70% bottom line band dictating an increase, slash bonus or decrease slash pay cut, with 80% being the steady state goal. I use Charlie Munger's adage and invert these success percentages and look at them as a likelihood of needing positive or negative course corrections of 10%, 20% or 30%. Bangin's four investor free launches, one true diversification he used 55% equities and 11% equal increments in large cap growth, mid cap, scv, total international micro caps. Two periodic rebalancing, three small cap value tilt accounted for large portion 50 basis points and moving his safe withdrawal rate of 4.15%. Based on his research and assumptions in the early 90s, thor Rising Equity, glide Path, fowl, kitsis paper.
Mostly Queen Mary:My overriding question is do you have feedbacks, additions, subtractions on this plan globally or its individual components? I am eagerly anticipating how you spice this up with your quips, clips and maybe a rant or two eagerly anticipating how you spice this up with your quips, clips and maybe a rant or two.
Voices:Gee kids, uh, you know, crossing the street can be very dangerous now. First, you have to look both ways okay now. Second, you have to make sure the light is green okay now it's safe to cross.
Mostly Queen Mary:By the way, have you ever thought of making all of your videos and audio clips available to your listeners? Don't be saucy with me, Bernays. They are classic and could spice up any talks, conversations, lectures that your listeners might give on personal finance.
Voices:It's going to be very popular.
Mostly Queen Mary:That goes without saying. Oof your brother in arms, mr Bill Q, oh no, mr Bill PS, I have happily donated a few times to the Father McKenna Center.
Voices:Okay, kids, we're going to try to cross the street again. Now, remember, you have to look all four ways. Okay, I think it's safe to cross now Make that five ways.
Mostly Uncle Frank:Well, let's start with the important stuff first, which is your last query about me making a compendium of my video and audio clips available to listeners. You know what that sounds like, Bill. That sounds like another job.
Voices:I don't think I'd like another job.
Mostly Uncle Frank:So I'm probably not going to be doing that. It's not that I'm lazy.
Voices:It's that, I just don't care.
Mostly Uncle Frank:But I'll tell you who has been working on things Our young Quebecois and top man who's been working on our website.
Mostly Uncle Frank:We have top men working on it right now Continues to make improvements and has actually been able to upload all of the transcripts for all of the episodes, going back to episode one, and they're searchable. Sackosh, I don't know how he did it, but I'm glad he did, and he's making more incremental improvements to the website every week. So please check that out at your leisure. But now let's get to the meat of your email. You want to talk about overall planning and how we incorporate the observations from Bill Bengen's new book into that planning, and how we incorporate the observations from Bill Bengen's new book into that planning, and so I'm going to approach this in a holistic manner and you'll see how we incorporate the things from Bengen's book into the planning process. But that book is not arranged for planning purposes. It's arranged for analytical purposes. So I would not use it as a checklist, if you will, except in the end to make sure you've covered everything. So, before we get to the planning process itself, I want to tell you what underpins my approach, because this is very scientifically based and it's based on good data science. That applies to forecasting, whether it's in the financial context, a medical context or any other context. It is something that is completely missing from the CFP curriculum. It is partially touched on in the CFA curriculum, but I think it's actually a big problem right now in the world of financial planning because they don't understand good forecasting techniques and the inherent limitations of certain kinds of forecasting. Man's got to know his limitations. So the basic forecasting methodology that I use comes from Daniel Kahneman, philip Tetlock, annie Duke and anybody who talks about forecasting, super forecasting, how to do good forecasting using data, how to do good forecasting using data, and the primary driver or primary principle in good forecasting is to always use base rates as inputs and do not use overly conservative or overly pessimistic forecasting as inputs, particularly into a compounding calculator, because you'll just get garbage out. Essentially, you make adjustments for the conservatism or aggressiveness on the output side, not on the input side. This concept is violated repeatedly by what I see going on in the financial advisor world. Just come up Particularly your favorite podcasters who are also financial advisors and that's because they never studied the underlying concepts of forecasting.
Mostly Uncle Frank:Now, the other basic principle you need to understand is the difference between risk and uncertainty, and this is something that Nassim Taleb talked about endlessly in his books. All of his books are about the same thing. When are we operating in a domain that is characterized by risk that is calculable, and when are we operating in a domain that is more characterized by uncertainty, which is not calculatable, at least with any precision? The best book on this in one place is a book called Risk Savvy. It's written by a doctor named Gerd Gingerenzer who's with the Max Planck Institute in Germany, and he's got some videos up. This book's been out for a while but it really defines the problem extremely well and there's a very important observation in that book and in this area of forecasting that in domains of uncertainty, you're better off relying on simple rules of thumb rather than adding more and more variables and trying to calculate it.
Mostly Uncle Frank:This is counterintuitive. You would think that you needed more data in an uncertain environment, but actually having more data doesn't help you. Knowing this does allow you to essentially apply the simplicity principle to a lot of forecasting, because a lot of the forecasting that is done for, say, 30 years hence is not worth the data that's being input, because the shorter the time frame as in now and the next few years that is an environment of risk you can calculate things. Having more information helps you. Once you get out past a decade or more. You are getting to more and more uncertainty, and you are better off using more rules of thumb than trying to add more and more variables and trying to calculate your way to what you'll be doing when you're 90 years old, if you even make it that far. So we'll be using these principles as we go through this methodology and process.
Mostly Uncle Frank:Okay, all good forecasting begins with understanding where you are and, in this case, understanding what your expenses are, because there's zero uncertainty about how much money you're spending in your life right now Zero. So the more data you have about that, the better decision making you can make. And so the first thing to do is literally go through your expenses from your records for the past few years and figure out what they are, because chances are your expenses, at least in the near future probably for the next five years, maybe longer are going to look similar to that anyway, and when you do that, you want to categorize them. You can have as many categories as you want, but you need at least two. One that you would classify as mandatory expenses Shelter, transportation, health care, taxes, things you have to pay given your current lifestyle, and food, but not expensive food, just regular food cooked at home.
Mostly Uncle Frank:I actually like to divide our expenses into three broad categories. One is mandatory expenses, what I call keep the lights on expenses, and that's the whole mandatory side. On the discretionary side, I divide it into two parts. One I call comfort expenses, which are things like gym memberships and eating out Stuff you do on a regular basis that makes your life more enjoyable, but you could drop it in a pinch if you had to. And then the third category I call extravagances, and these are generally not regular expenses. They're big vacations, they're renovations to the house, they're buying the boat, yolo, stuff that you are going to incur on an irregular basis and that can often be planned around. So these are very easy to drop out of the budget. You just decide you're not taking the big trip this year, whatever.
Mostly Uncle Frank:Now, when you look at most people's finances and financial advisors have observed this as well as others an interesting pattern tends to drop out, particularly for people who are well-saved and well-prepared for retirement. Typically about 60% of their expenses fall into the mandatory category and 40 percent are discretionary. You know it's. It's interesting when you listen to people like ramit seti. He comes up with a plan for people's living expenses that revolves around this observation that you really want to get your mandatories and at about 60 percent when you're accumulating, what you're probably doing is doing that 60% is mandatory, you got 20% that is discretionary, and then you have another 20% that's going to savings.
Mostly Uncle Frank:Obviously, when you're in retirement, you don't have to have that savings component anymore. So basically, you have more discretionary possibilities. This also tells you how flexible you are, and that is what Ramit Sethi is counseling people that you don't have enough flexibility if your mandatories are 80, 90, or 100% of your expenses. Same is true in retirement and I have found, looking at our expenses, that we typically fall into this kind of category, which leads to a very nice rule of thumb that goes with a 5% withdrawal rate and it's what I call the 3-1-1 plan. I've talked about this particularly in episode 338, but also episodes 334, 341, and 324. You should go back and listen to those because I'm only going to touch on it briefly here. So if you are withdrawing at 5% and you're looking at these general guidelines, 3% of 5% is 60%, if that makes any sense.
Mostly Queen Mary:You are talking about the nonsensical ravings of a lunatic mind.
Mostly Uncle Frank:So 3% of your spend is going to go to mandatory, then you have 2% for discretionary, 1% of that is comfort expenses and 1% of that is extravagances, and so that is the general framework that I'm looking at 3-1-1. And I found that is about as precise as you need to be overall. Your expenses don't need to fall neatly into those categories. They will vary year on year but if you're tracking them, you will see that, broadly speaking, they tend to fall into these categories, based on probably what you're spending right now. Okay, so suppose you've evaluated your current expenses, how do you apply risk and uncertainty to the next stage of planning going forward? Well, everything that's closer in time falls into that risk category. So you can certainly plan out the next few years in as excruciating detail as you want to, and you do want to sit down and think about all the things that you might be spending money on that are different in any way from what you're spending money on now, and do that for at least a five-year period, maybe a 10-year period if you don't plan on changing much. But as you get further out in time, the more uncertain this tends to get, and then it's better to start thinking about this in terms of a rule of thumb. The best rule of thumb to think about here first is when are your personal expenses likely to peak?
Mostly Uncle Frank:For most people, they peak sometime early in retirement or even before retirement, depending on their child situation. For a lot of people like us, our expenses peaked when our children were in college, and we've been in retirement five years and our nominal expenses have actually been dropping, which has surprised me, but it's not that unusual. So it's possible that you are already at peak expenses right now in terms of going forward, and that number is important because that is the number that you want to apply inflation to. And what we know from lots and lots of research is that retirees do not experience inflation at the same rate as the general population, because the general population is working, having more children and incurring more expenses. So this has been researched to death and retirees experience inflation at one to two percent less than the CPI on average. And that includes all of the spendthrifts who are paying no attention to this whatsoever and buying three boats named YOLO 1, yolo 2, and YOLO 3.
Voices:Say Mr Bill, where are you going? I'm on my way to a big Hollywood party at Ken and Barbie's Gee. I sure hope GR Joe isn't there. Well, how about some Coke first to help get you in the mood? Well, I'd rather a diet soda. You know, I've been trying to cut down on my sweets. Well, here comes your agent Sluggo and he says all he has is coke.
Mostly Uncle Frank:No, no, no. So that is a good base rate for you to use as inflation. Going forward on this max expense number. That max expense is a good base rate to start with and the inflation rate of CPI minus 1 or CPI minus 2 is a good base rate to use for forecasting purposes. I see financial advisors screwing this up badly all the time and this is how they screw it up they try to take apart inflation and they do things like well, you know, health care is going up a whole lot. I better make that 5%, 6% or some big number.
Voices:Are you stupid or something?
Mostly Uncle Frank:That makes no sense, because if you are going to do that, you have to recognize that your total inflation calculation still needs to be that base rate of CPI minus 1 or CPI minus 2. So where is the deflation in your calculation? If you are over-inflating one part of expenses, you need to under-inflate or deflate another part of expenses. What this means is you have a whole lot more variables, a whole lot more potential for error, and that is bad forecasting. That is bad forecasting.
Voices:Am I right, or am I right, or am I right?
Mostly Uncle Frank:Right, right, right Don is bad forecasting. Am I right, or am I right, or am I right? Don't do it. The long-term future is uncertain. Therefore, you need to use the base rates and not make up a whole bunch of other numbers to complicate things.
Voices:Hello, hello, anybody home? I think McFly, I think.
Mostly Uncle Frank:To justify your fees, showing you're doing something advanced and complex. It's stupid, fat, drunk and stupid is no way to go through life, son. Okay, now if you've got that laid out, you can make this as complicated or uncomplicated as you want. You can use a lot of spreadsheets, you can use popular calculators, it's all the same thing. You're just adding up numbers and putting numbers in a forecast, but I wouldn't fixate or focus on stuff that is over 10 years out in the future. If you are like us, you can actually simplify this even more, because I know our expenses are going down right now. They will continue to go down for various reasons. One of those reasons is part of our mandatory expenses right now is supporting my parents. My parents are 96 and 91. They're not going to be around in 10 years. Most likely is supporting my parents. My parents are 96 and 91.
Voices:They're not going to be around in 10 years, most likely Death stalks you at every turn, Grandpa. Well it does.
Mostly Uncle Frank:So we're going to be dropping a lot of expenses there. At some point we're going to downsize this house. We're going to be dropping more expenses there, and you may or may not have a similar situation. But what this should be telling you for a lot of you that you don't need to have complicated forecasting if you know that your expenses are effectively going down, even if you're not going to be spending the same money on the same things.
Mostly Uncle Frank:But that is where personal finance is personal, because if you were intending to adopt a whole new lifestyle and move to a high cost of living city and buy a bunch of property and do a bunch of other things, yeah, your expenses could go up. That is not the usual pattern of most retirees, however, so you should not be pretending that these expenses are going to appear out of nowhere unless you're actually planning on doing those things, Because, again, that's just bad forecasting. Okay, that's the expense side of things. That's about as detailed as it can be on a podcast like this, because obviously it's going to be very dependent on your own personal circumstances. Now let's start talking about how you're going to cover those expenses.
Voices:I am a scientist, not a philosopher.
Mostly Uncle Frank:This is something I actually went over at the last economy conference in my presentation there. There are essentially four levers of post-financial independence finances that you can pull to cover your expenses. The first one is supplemental income. That includes things like pensions and Social Security. One is supplemental income that includes things like pensions and Social Security. It could also include side jobs or rental real estate or just something else that is generating income.
Voices:All we need to do is get your confidence back so you can make me more money.
Mostly Uncle Frank:Maybe an inheritance, if you're really lucky, lucky. The second lever you can pull is asset selection and portfolio construction. You can construct portfolios that allow for more spending or you can construct them to allow for less spending, and that's a lot of what this podcast is about and a lot of what Bill Bengen's book was about. How do you construct portfolios that allow you for more spending in retirement? Because if you're not doing that, you're essentially fighting with one hand behind your back. You're not using all the tools that are available. I award you no points, and may God have mercy on your soul, all right. The third lever is flexible withdrawals, or how flexible are your withdrawals? Now, typically, when people are doing 4% rule calculations, they are assuming zero flexibility in withdrawals. They are assuming that 100% of your baseline spending is mandatory, there is no discretionary expenses there at all, and that you are forced to increase your spending at the rate of CPI inflation, forced to increase your spending at the rate of CPI inflation. It's all mandatory all the time, all CPI inflation all the time.
Voices:The next morning you find it filled to the brim with jack squat.
Mostly Uncle Frank:In reality, that applies to almost nobody, except people that are very poor because all of their resources are being used for mandatory expenses. So if you can pull this lever and use flexibility in your spending going forward, you can effectively increase the safe withdrawal rate. The easiest way to do that is to simply use actual spending, that is, that base rate assumption of CPI minus 1% or CPI minus 2%. If you are doing CPI minus 1% as your base rate, that effectively adds about 0.5% to your safe withdrawal rate. If your base rate assumption is that inflation affects you at CPI minus 2%, then you can effectively add 1% to your safe withdrawal rate. And if you go to something like a full guardrail strategy where you are adjusting your withdrawals based on the performance of the portfolio, you might be able to increase your safe withdrawal rate to around 1.3% over its base. What that means is, if you are flexible at all, you can probably spend more money than you think you can Now.
Mostly Uncle Frank:This data I've been talking about comes from a number of sources, but the easiest place to find it is in the Morningstar studies they do periodically. It's called the State of Retirement Income. This one comes from 13 November 2023. You can find that at their website and download it, but basically they took all of these variable kind of withdrawal strategies, applied it to a basic portfolio that could be anywhere from 0% to 100% in stocks and then saw how the variable withdrawal strategy affected the safe withdrawal rate. And so these are good estimates, and since this is an area of uncertainty as to exactly how portfolios are going to perform in the future, the estimates I gave you are as good as you can get.
Mostly Uncle Frank:They're not going to get more precise by running more data through something, and what you should take from this is that if you are flexible, you can spend more money than you think you can, and it's going to be somewhere between zero and 1.3% more. All right. The fourth lever is the one you don't want to pull. It's the fear and hoarding lever that if you just cut spending or if you underspend your portfolio, then the rest of this stuff doesn't matter. If you're spending 3% or less, then you can do whatever you want with your asset selection. You can be as flexible or inflexible as you want with your withdrawal strategy. Your supplemental income doesn't matter, because you're still just accumulating more money. You're going to die with as much as possible.
Mostly Queen Mary:What's with?
Voices:you anyway.
Mostly Queen Mary:I can't help it. I'm a greedy slob, it's my hobby. Save me.
Mostly Uncle Frank:So if you pull that lever down, it obviates the need to even do anything with the other levers, which always amuses me, because lots of people in the personal finance space fall into this category. They're grossly underspending their portfolios, and so I'm like, well, why do you bother? Even talking about the rest of it? Forget about it. The only relevance it's going to have is how much you are going to have when you're dead. Dead is dead. If you are grossly underspending, you do not need to focus on asset selection or portfolio construction. You do not need to focus on flexibility withdrawals. You do not need to focus on side income. In fact, you're probably wasting a lot of your time focusing on any of this stuff because you've already solved the problem by not spending money. That's the fact, jack. That's the fact. You're probably wasting a lot of your time focusing on any of this stuff because you've already solved the problem by not spending money.
Voices:That's the fact, Jack. That's the fact, Jack.
Mostly Uncle Frank:You should stop reading about finances, stop listening to podcasts about finances, because it serves no purpose in your life. So in my mind, the better way to approach this is to be very light on that lever, focus on using the other levers, because then you'll be able to spend more money in retirement and give it away if you're not going to spend it on yourself. And when I look at our own finances, we are essentially giving away 1% of a year, about 20% of our expenses. That includes support of my parents, money to kids as an advance on their inheritance and just charitable giving, which creates a ridiculous amount of flexibility in our plan and allows us to live a much better life in the here and now and for the people around us to live much better lives in the here and now, because pulling on that fear and hoarding lever is going to damage your relationships with the people you love. It just is, trust me.
Mostly Queen Mary:You no longer love me.
Voices:When have I ever said that In words? Never. Well in what, then, in the way you have changed? But how have I changed towards you by changing towards the world? Is it such a terrible thing for a man to struggle with something better than he is?
Mostly Queen Mary:Another idol has replaced me in your heart.
Voices:A golden idol. It's singular. The world that can be so brutally cruel to the poor professes to condemn the pursuit of wealth. In the same breath, you fear the world too much, with reason. But I am not changed towards you, aren't you?
Mostly Uncle Frank:Alright, let's start talking about these levers in more detail. That first one, supplemental income, is the most important one actually for most Americans, because most Americans are living substantially on their Social Security in retirement, and if you are one of those people, you need to focus your planning around that as to when you're taking Social Security, whether you have another pension, those other factors, and hopefully that's going to cover most or all of your mandatory expenses. But the general way you plan around that is you subtract your supplemental income, your annual supplemental income, from your annual expenses to get a net amount that needs to be covered by your portfolio. Now, what I just described is actually not the situation that I think most people listening to this podcast are in, at least the ones I've talked to. Most people that listen to this podcast have somewhere between $2 and $15 million. For my informal survey, they're not planning on using Social Security or other income as a large proportion of their retirement resources, and so I saw that you did not mention this at all in your email, and so if you are not going to rely much on Social Security, you should still count it at some point.
Mostly Uncle Frank:But yes, we can model pretending it doesn't exist and then think of it as a big buffer that's going to come in at some point. Ideally, you would model with and without it. For us, since we retired at age 55 and we didn't plan on taking Social Security until 70, we needed to model without it. If you are retiring at age 65, it's going to be a very important component. It's in the near future and you should probably be more modeling with it than modeling without it. But for podcast purposes, we're going to pretend that doesn't exist or that it has already been subtracted from the gross annual expenses and so we do have a net amount that needs to be covered by a portfolio.
Mostly Uncle Frank:All right, so let's go to that asset allocation lever and talk about that. That's number five in your list of eight things. Now, assuming you want to maximize spending, yes, you do need a diversified portfolio, like a risk parity style portfolio or something like what Began suggests in his book portfolio or something like what Began suggests in his book. The portfolio you gave us is 25% US large cap growth, 20% US small cap value, 10% international large cap growth, 5% international small cap value, 10% gold, 15% in intermediate or long-term treasury bonds, 10% in managed futures and 5% in cash. I went ahead and modeled something like this in Portfolio Visualizer using the Portfolio Matrix tool to make it easy to compare it with 20 other portfolios, and I just misspoke that tool is at Portfolio Charts, not Portfolio Visualizer.
Voices:Are you stupid or something?
Mostly Uncle Frank:And you do need to pay $5 a month now to access it, but I think it's worth it. So when I modeled it at Portfolio Matrix and compared it with these 20 other portfolios, it was fourth in terms of safe withdrawal rates, at 5.7. The top three were the Golden Ratio Portfolio at 6.1, the Weird Portfolio at 6, and the Golden Butterfly at 6. On the other end of the spectrum of this tool, a total stock market portfolio comes in at 3.8. Classic 6040 comes in at 4.1. Bogle Head 3 Fund portfolio comes in at 4.3.
Mostly Uncle Frank:I've also modeled Bengen's portfolio out of the book in this same tool and you do get a similar safe withdrawal rate as the one you have, which is about 5.7 on this tool. Now what's important about this tool and any tool really talking about comparing safe withdrawal rates is not the actual number itself, it's just knowing that portfolio A is better than portfolio B. So, regardless of what you think the actual safe withdrawal rate should be, you want portfolios that have higher safe withdrawal rates using the same data sets as other portfolios, and what we've seen time and time again, whether we use this tool or Portfolio Visualizer or the 100-year data set from the Early Retirement Now toolbox, is that these risk parity style portfolios just have higher safe withdrawal rates than standard portfolios. It seems to be at least 1% better.
Voices:You are correct, sir.
Mostly Uncle Frank:yes, so for some other comparisons, bill Bengen's portfolio from his book, he says over a 100-year time frame has a 4.7% safe withdrawal rate. If you run simple risk parity style portfolios through the same data set, you'll get, I think, 4.83 or 5 in the worst case scenarios for those portfolios, and that's only due to the Great Depression. You're well over 5 and even into the 6s for almost every other decade. So what this tells us is that using a baseline withdrawal rate of 5% for this kind of portfolio is very reasonable. It's very doable. In fact it's conservative. You already have a built-in buffer Because, remember, this calculation is also assuming that your expenses are all mandatory and you will be forced to increase them every year by the CPI rate of inflation which, as we know, doesn't apply to anybody, or not anybody that is saving for retirement like what we're talking about here. Okay, so we're already underspending the portfolio using 5%. Now what if we pull on that lever for variable withdrawals? Well, the easy pull is simply just to use our actual predicted spending, which is 1% to 2% less than the CPI, and if we do that, we can effectively add another 0.5% to 1% to this figure, which means you could spend more, or you can just consider that as a big buffer that's built in, which is generally what we do Now. You can get more complicated with that. You mentioned using a Geithen-Klinger or guardrails approach, which could potentially increase your safe withdrawal rate even further. From my perspective, I would rather just apply the simplicity principle to this, since we're only planning on spending the 5%. If I was trying to spend 6%, yeah, I'd be more focused on a more complicated variable withdrawal strategy, and you can do that, but I honestly don't think it's necessary if you're only planning on spending 5%. And so that covers numbers one and six on your list.
Mostly Uncle Frank:Okay, let's go to number two on your list, which is the planning horizon. Your planning horizon is 30 to 35 years, so that's kind of a standard planning horizon. That would not change any of these standard safe withdrawal rate calculations, which are geared at 30 years. But one of the most important things from Bengen's book and that we've known before but people seem to ignore because they think their portfolio is going to turn into a pumpkin after 30 years and it's gone Poof Is that the safe withdrawal rate does not drop linearly as it goes out further in time, and in fact, the difference between the 30-year safe withdrawal rate and a forever safe withdrawal rate is about 0.6.
Mostly Uncle Frank:You would subtract 0.6 ona forever timeframe. On a 35-year timeframe, you're probably talking about subtracting 0.1 or 0.6. You would subtract 0.6 on a forever time frame. On a 35-year time frame, you're probably talking about subtracting 0.1 or 0.2. Bengen's book has a lot of nice pictures of this. You can also see this if you go to the safe withdrawal rate calculator at portfolio charts, because it has these charts showing the safe withdrawal rate going from 15 years to 45 years and you can see how it flattens out the further you go out.
Mostly Uncle Frank:In practical and in simplifying terms, you can use the flexible withdrawal strategy to cover any lengthy planning horizon scenario, because if you are getting 0.5 to 1% or more just by being flexible in your withdrawals and using the average retirees inflation, that takes away or covers that 0.6, which would take you from a 30-year time frame to a forever time frame, which effectively means that that 30-year estimate is good for forever with any reasonable variable withdrawal strategy and you can use the 30-year time frame as the baseline estimate if you just want to simplify things and you probably should simplify things here because we were talking about uncertainty when you're talking about 30-year plus time frames, so adding more and more detailed calculations is not going to get you a better answer.
Mostly Uncle Frank:This is honestly another litmus test I use to determine whether a financial advisor knows what they're talking about or not. With respect to safe withdrawal rates, it's all one big crapshoot, anywho, because if they apply some kind of linear function and say, well, if it's 10 more years, you better subtract 1%, this is wrong, this is bad math wrong and you're either ignorant or you're just fear-mongering and trying to sell something.
Mostly Uncle Frank:You need me to come here and adjust this with my precise tools. You know, whenever I see an opportunity now, I charge it like a bull. Ned the bull Bull. That's me now and, yes, I'll let you spend a little bit more money, but you need to give that to me. It's my AUM fee.
Voices:And I have a straw. There it is. That's a straw. You see, Watch it. My straw reaches across the room and starts to drink your milkshake. I drink your milkshake. I drink it up.
Mostly Uncle Frank:The truth is, planning Horizon is not that big a deal, because the big deal in this and for safe withdrawal rate purposes, is that first decade, not the first three years, the first decade I think Michael Kitsis has actually done the research here, and I know Bill Bengen has said this that it is that sort of 9 to 11 year time frame from retirement that seems to be the most salient or important in this whole discussion, because that's what you're really trying to survive and once you've survived that, your situation is likely to improve, if it has not improved already. All right, number three on your list portfolio tax status. Okay, this is going to be different for every person and I don't think it makes sense to try to account for this on the portfolio side of things. Taxes are an expense and you should be accounting for those when you added up those expenses. Taxes are a mandatory expense and, yes, you can estimate them. It's not that hard.
Mostly Uncle Frank:The truth is, a retiree's taxes tend to go down because you have a whole lot more flexibility as to when this money comes out of these accounts. You're not paying FICA anymore. This is not a big problem. Now. There is a great book about tax planning in retirement that is just coming out, written by Cody Garrett and Sean Mulaney, where they poke a lot of holes in all of this fear mongering about taxes and retirement Fire and brimstone coming down from the skies, rivers and seas, boiling.
Voices:Forty years of darkness, earthquakes, volcanoes, the dead rising from the grave.
Mostly Uncle Frank:Because a lot of that is BS. It's put forth to scare people so that they'll run to financial advisors and buy stupid things or overpay them.
Voices:Because only one thing counts in this life Get them to sign on the line which is dotted.
Mostly Uncle Frank:I would get that book and you'll learn things like worrying about Irma is stupid and a waste of your time, forget about it and that RMDs are easy to manage Inconceivable In any event. I would not try to apply a tax status to the portfolio side of this, because it just makes the calculations more complicated. Instead, you need to put a tax estimate with your expenses in the first place, based on whatever you think is relevant to that in terms of your portfolios. That is the way you apply the simplicity principle to this. Keep your expenses all in the expense category, do not mix them with returns. And this is also where you end up with risk and uncertainty considerations, in that your overall tax plan is subject to uncertainty if you're talking about planning over decades, so you shouldn't spend too much time on that, but you should spend a lot of time on what is going on this year or next year and do some kind of assessment annually, in the fourth quarter in particular, because that is when you're going to be deciding how much you're going to take out of accounts, which accounts are going to come from.
Mostly Uncle Frank:Is there tax laws, harvesting? Are there other considerations? Have you started social security or not? When are you going to do that? How is that going to affect your tax status, so on and so forth. That needs to be done every year in a granular kind of way, but it's a waste of time to try to do that about your taxes in 10 years time, other than generally recognizing that you want to spread your tax liability out over as many years as possible, because that's going to keep your effective tax rate the lowest over the course of your life.
Mostly Uncle Frank:So if you're not paying hardly any taxes early on, you maybe wanted to take more distributions or do more conversions then, because that's going to solve any RMD problem that you might have later. Moving on, number four on your list is legacy. When you say wish to give money with retirement cash flow budget to kids and charity as able, and I think that's the way to go about this that make it part of your budget that instead of thinking about well, how much am I going to leave when I'm dead and creating a pile of something there, if you just make it a part of your budget when you're alive, then you're already dealing with your legacy while you're alive and seeing it put to good use that is the straight stuff.
Mostly Uncle Frank:Oh funk master and more and more experts in this area are telling people that the best way to manage family wealth is to do it while you are alive and not leave something that needs to be managed or dealt with when you're dead as the primary legacy.
Mostly Queen Mary:That's not an improvement.
Mostly Uncle Frank:And that's the funny thing about compounding and legacies here, because if you are able to get $62,500 into your children's Roth IRAs when they're in their 20s or even up to early 30s, you let that compound over several decades, it's probably going to double four times using the rule of 72, or even up to early 30s you let that compound over several decades, it's probably going to double four times using the rule of 72, in which case it's going to be worth a million dollars, but it's already going to be, hopefully, in a Roth IRA, growing and never taxed for them.
Mostly Uncle Frank:And you can also use that to teach them some financial literacy, because that is the biggest problem with leaving a whole lot of money to somebody who ends up being in their 60s, which is the average age that people are receiving large inheritances these days. And these people don't know how to manage their money because you never taught them, you never gave them the money in the first place to help them manage it. Fat, drunk and stupid is no way to go through life, son. And so what happens to them? They end up going to a free steak dinner and buying some stupid annuity products or something.
Voices:A guy. Don't walk on the lot lest he wants to buy. They're sitting out there waiting to give you their money. Are you going to take it?
Mostly Uncle Frank:And you didn't create a legacy, you screwed up your legacy.
Voices:I'm as stupid as a stupid dude is screwed up your legacy.
Mostly Uncle Frank:Now, if you do plan, for whatever reason, that you want to leave a certain amount of money to a certain person for a certain reason, probably the better way to do that is simply to just cabin that off from the rest of your assets, put it in some account in something that's going to grow very well, because if it's just going to sit there for 30 years, you want it in stocks, you don't want it in CDs or something. Forget about it. The other way of doing that is through insurance products. Particularly, whole life insurance is often used either for somebody who's going to be a dependent for life, a disabled child or something like that, or if you've got some business that needs to be transferred and there's going to be taxes involved with that. Oftentimes a whole life policy helps with that. There is other tax planning that goes for people who have multiple eight figures, something called private placement life insurance, but that is not really for us mere mortals who are in what Nick Maggiuli calls level four, having between one and $10 million. Not going to do it Wouldn't be prudent at this juncture. So I don't think you need to complicate it any more than just putting it in your spending budget. You can if you want, but again, if you want to just apply the simplicity principle to this, put that advancement on inheritance or legacy in as an annual budget item to be dealt with at that time, and then you don't need to worry about the rest. And if you do have financial problems, yes, you can cut it, but you're not going to if you've pulled all these levers. Well, number five on your list was the asset allocation. We already talked about that. Number six is portfolio rebalancing, and you mentioned Geithner-Klinger bands Again. Here. You can make this even simpler if you want, which is just rebalance it once a year.
Mostly Uncle Frank:I think the other consideration, though, is whether you want to use a rising equity glide path, like you've also mentioned here and also is mentioned in Bill Bengen's book. That is something I had studied but was not very confident about, given the paucity of the research. But now that I've read more about it in Bill Bengen's book and I'm hopefully going to ask him a question about this at some point because it seems to me that the rising glide path you would want would still stay within the parameters of having a portfolio with a high, stable withdrawal rate, which means going from like 40, some percent up to 70 percent over time makes sense to me, but I don't know what the data actually says about that. Now that we've been in retirement for five years, I am considering doing this going forward, because it's also going to make rebalancing easier in most circumstances, because in most years your stocks outgrow everything else and if you have to sell less of them to do a rebalancing, it just makes things easier. So we may be implementing this with one of the sample portfolios next year, because I think it makes a lot of sense at this point, given the state of the research and what we've learned from this book in addition to the earlier papers and things.
Mostly Uncle Frank:What I really wanted to see is did it affect more diversified portfolios like the one he suggests in the book, as opposed to some kind of simple 60-40 portfolio that might have been portfolio dependent? It seems like this methodology applies generally to most portfolios and that it's something we ought to be thinking about incorporating, because it's a relatively easy operation to deal with. So you can make it more complicated than that with Geithenklinger bands or anything else. I don't think you necessarily need to do that if you're spending 5%, or that's your goal, all right. Number seven you just mentioned that we're accepting average passive returns. Yeah, that's what we're doing. We're not pretending that our assets are going to outperform historical base rates. Again, that is just using base rates as your basis for forecasting and not making up crystal ball assumptions that make them much better, much worse.
Mostly Queen Mary:Now the crystal ball has been used since ancient times. It's used for scrying, healing and meditation.
Mostly Uncle Frank:Because that's just bad forecasting. If you're doing that, which, unfortunately, is what goes on a lot in these retirement calculators, they're bad crystal balls embedded within them A really big one here, which is huge. And you also mentioned, as number eight, withdrawal timing monthly on the first of the month to mimic paycheck and reverse dollar cost averaging. And that's basically what we do. I mean, mary and I sit down and look at a budget every month. It takes us all 10 or 15 minutes now because it's mostly the same every month and we just are adding in extraordinary expenses, for the most part lumpy tax payments and other things like that, and then we figure out, well, where is this going to come from? And then I go see if we need to sell something or how that needs to work, and put that in the plan for that month and go ahead and implement it. Now you could also simplify this even more, particularly with your portfolio setup, because you have a built-in 5% in cash in the portfolio, and so another way of looking at this would simply be let's just spend out of that cash the whole year round and then only look at this once a year, like we are doing with the sample golden ratio portfolio where we don't have to think about anything. We just spend out of the cash and then rebalance the next year, refill the cash bucket and there you go. That was the original Harold Levinsky bucket strategy One bucket of cash for one year, very simple. So you might think about that. It's very appealing psychologically because it allows you to not have to look at your assets at all. It's an easier way of managing than actually selling something every month, but either way works. That's more personal preference than anything else.
Mostly Uncle Frank:Now you mentioned after that monitoring the portfolio's performance using funded ratios, repeated Monte Carlo simulations or other things involving bans. You could do as much of that as you want, but you really don't have to if you don't want to. What I do is just periodically update our net worth and look at the accounts, see where they are, but we really haven't had to change our spending habits based on any of that. So I'm not sure how much value that actually has if you already have a flexible spending plan. So there's nothing wrong with doing some more calculations if that trips your trigger. But you probably don't really need to unless all of your spending is mandatory.
Mostly Uncle Frank:But I think this answer has been going on long enough. This is pretty much the worst video ever made. No, we're not going to cover everything in an hour we're on podcast but we did cover a lot. I do think you have a good outline of a plan in place. You will find that you will make adjustments as you go, because you will also find that certain monitoring or planning tools may not be that helpful or useful and that can be dropped after you've been in retirement for a few years. The most important thing you can do right now is to really track your expenses in as much detail as possible for the next five years, because if you get that locked down, the rest of this is going to be relatively easy and can be simplified.
Voices:Budgets. We don't need no stinking budgets, relatively easy and can be simplified.
Mostly Uncle Frank:Because that's where you have the most control. That is risk-related, so more calculating helps, gets you better answers, and that's not true when it comes to this portfolio construction stuff, or getting more and more granular and trying to imagine what things are going to be like in 30 years, is not helpful for your planning purposes. It may not be helpful for your psychological purposes either.
Voices:Well, you haven't got the knack of being idly rich.
Mostly Uncle Frank:You see, you should do like me just snooze and dream, dream and snooze. The pleasures are unlimited. Anyway, thank you for your most excellent email and being such a good friend, and for your donations to the Father McKenna Center as well.
Mostly Queen Mary:Top drawer, really top drawer.
Mostly Uncle Frank:We'll be seeing you and Karen very soon to engage in some extravagant spending.
Voices:Yeah, baby, yeah.
Mostly Uncle Frank:And we'll just leave that right there.
Voices:Well, kids, we're going to try one last time to cross the street. Now, remember, look all five ways. Okay, I think we can cross now. Okay, I think we can cross now.
Mostly Uncle Frank:Oh, now we're going to do something extremely fun, and the extremely fun thing we get to do now is our weekly portfolio reviews. Of the eight sample portfolios you can find at wwwriskpartyreviewcom on the portfolios page.
Voices:Boring.
Mostly Uncle Frank:Just looking at the markets this year, everything is going up Means we probably have a weak dollar, which is really the case. You'll find that everything priced in dollars does tend to go up when the dollar becomes a lot weaker. Anyway, the S&P 500, represented by VOO, is now up 12.92% for the year so far. The NASDAQ 100, represented by QQQ, is up 15.15% for the year so far. Small cap value, represented by the fund VIOV, is up 2.65% for the year so far. Continues to be a laggard, but gold continues to be the big winner this year.
Voices:I love gold.
Mostly Uncle Frank:Gold, represented by GLDM, is now up 38.8% for the year so far. Long-term treasury bonds, represented by the fund VGLT, are now up 6.37% for the year so far by the fund VGLT, are now up 6.37% for the year so far. Reits, represented by the fund REET, are up 9.26% for the year so far. Commodities, represented by the fund PDBC, are up 2.46%. Preferred shares, represented by the fund PFFV, are up 3.49% and managed futures are managing to make some progress. Now, representative fund DBMF is up 4.4% for the year so far. Now moving to these sample portfolios. First one's the All Seasons. It's a reference portfolio. It's only 30% in stocks and a total stock market fund, 55% in intermediate and long term treasury bonds and the remaining 15% in gold and commodities. It's up 2.55% for the month of September. It's up 10.69% year-to-date and up 20.16% since inception in July 2020.
Mostly Uncle Frank:Moving to these kind of bread and butter portfolios, first one's golden butterfly. This one is 40% in stocks, divided into a total stock market fund and a small cap value fund, 40% in treasury bonds, divided into long and short, and 20% in gold. It's up 2.42% for the month of September. It's up 13.06% year to date and up 51.42% since inception in July of 2020. Next one's golden ratio. This one's 42% in stocks, divided into a large cap growth fund and a small cap value fund, 26% in long-term treasury bonds, 16% in gold, 10% in managed futures and the remaining 6% in cash and a money market fund. It's up 2.97% for the month of September. It's up 12.75% year-to-date and up 46.53% since inception in July 2020. Next one's the risk parity ultimate kind of our kitchen sink. I'm not going to go through all 12 of these funds, but it's up 3.71% for the month of September. It's up 12.83% year-to-date and up 34.65% since inception in July 2020. Now moving to the experimental portfolios.
Voices:Tony Stark was able to build this in a cave with a box of scraps.
Mostly Uncle Frank:Don't try this at home. These all involve leverage funds and lots of volatility.
Voices:Well, you have a gambling problem.
Mostly Uncle Frank:First one's the accelerated permanent portfolio. This one's 27.5% in a levered bond fund TMF, 25% in a levered S&P 500 fund UPRO, 25% in PFFV, a preferred shares fund, and the remaining 22.5% in gold and GLDM. It's up 6.27% for the month of September. So far, it's up 16.92% year-to-date and up 18.12% since inception in July 2020. Next one's the aggressive 50-50. This is the least diversified and most levered of these portfolios and most volatile. It's one-third in a levered stock fund UPRO, one-third in a levered bond fund TMF and a remaining third in preferred shares and an intermediate treasury bond fund as Ballast. It's up 5.97% for the month of September. It's up 11.04% year-to-date but down 2.2% since inception in July 2020.
Mostly Uncle Frank:Next one's the levered golden ratio. This one is a year younger than the first six. It is 35% in a composite fund called NTSX that is, the S&P 500 and treasury bonds levered 1.5 to 1. It's got 15% in AVDV, which is an international small cap value fund, which I think is up something like 37% this year. It's got 20% in gold GLDM, 10% in KMLM, which is a managed futures fund, 10% in a levered bond fund TMF, and the remaining 10% divided into a levered fund that follows the Dow and a levered utilities fund. It's up 3.71% for the month of September. It's up 17.93% year to date's up 3.71% for the month of September. It's up 17.93% year-to-date and up 12.72% since inception in July 2021. And our last but not least is the Optra portfolio One portfolio to rule them all.
Voices:And in the darkness I'm thin, in the land of Mordor where the shadows lie.
Mostly Uncle Frank:This is a return-stacked style portfolio. It is 16% in UPRO it's a levered S&P 500 fund 24% in AVGV, which is a worldwide value-tilted fund, 24% in GOVZ, which is a treasury strips fund, and the remaining 36% divided into gold and managed futures. It's up 4.52% for the month of September. It's up 16.51% year-to-date and up 19.91% since inception in July 2024. It's only a little over a year old, but that completes our portfolio reviews for this week and that's probably enough for now, because this podcast has gone on for quite a while you fell victim to one of the classic blunders but now I see our signal is beginning to fade.
Mostly Uncle Frank:If you have comments or questions for me, please send them to frank at risk party radiocom. That email is frank at risk party radiocom. Or you can go to the website, www at riskpartyradiocom. That email is frank at riskpartyradiocom. Or you can go to the website wwwriskpartyradiocom. Put your message into the contact form and I'll get it that way. If you haven't had a chance to do it, please go to your favorite podcast provider and like subscribe. Give me some stars, a follow, a review. That would be great. Okay, thank you once again for tuning in. This is Frank Vasquez with Risk Party Radio.
Voices:Signing off. Hey, hey, hey. What's going on here? Why are they taking all my furniture? Well, all that Coke you bought last night was real expensive. You're broke? No, no, but I didn't buy it. Sorry, Mr Bill, but we'll have to sell the house. No wait, no, Mr Bill, where are you going? Oh, LA's too dangerous. I'm going back to New York where I'm wanted.
Voices:Say that's quite a long trip. Yeah, thanks to you and Sluggo, I can't even afford to fly anymore. Hey, wait, what is this place? No, wait, get me out of here. No, hey, stop, get me out of here. Get me out of here.
Mostly Queen Mary:The Risk Parody Radio Show is hosted by Frank Vasquez. The content provided is for entertainment and informational purposes only and does not constitute financial, investment tax or legal advice. Please consult with your own advisors before taking any actions based on any information you have heard here, making sure to take into account your own personal circumstances.
