Retiring in 8 months @ 60. I think I can provide us the gains a 60/40 gives but make it feel like a 3 bucket safety net - sort of a hybrid of the two:
\- 2-3 years living expenses in cash equivalent (money market/CD ladder/TSP 'cash')
\- Designate 6 years of required income as an 'untouchable' portion of the 40% 'fixed income' (TIPS, bond funds, PIMIX, etc)
\- Remainder of assets designated at 'Growth' in well-chosen stock funds.
\- Rebalance annually or market up 10% year-on-year.
All income withdrawals are from the 'fixed income' portion with rebalancing going one way from 'growth' to 'fixed' if the market is up 10% year-on-year or up at all annually. Never rebalance from 'fixed' to 'growth' if hitting the "untouchable" portion.
The 'cash' is a "Well crap, everything is going to hell" safety net.
If I mechanistically follow these rules it should remove most of the angst, provide safety, and still enable long term growth. 5-6 years in 'fixed' is a deep enough buffer for any market to recover from, if longer than that the 2 years of cash provides more carryover.
As long as stocks aren't touched they always come back sooner or later, just have to wait long enough.
FWIW I moved to 40/60 a year ago in prep - I thought the market was about to tank but it looks like it took a year later than I thought to start.
I also posted this in Retirement but after a bit of thought it probably belongs here.
I think I'm being somewhat clever but I know I'm probably not and this might be old news but I'd like to hear your thoughts and if anybody can poke holes in the plan.