Q: Should I manage our portfolio myself? As my wife and I near the age 59 ½ milestone in our planning process I would appreciate your opinion on my decision to not manage our sizable portfolio myself.
Our focus now is to pay down debt in an effort to reduce future cash-flow needs and consider how we define retirement. Age 59 ½ is a key milestone for how we choose to define and spend our remaining years. Both of our kids are educated and equipped to make meaningful lives for themselves.
Now I question if my reasoning for allowing a reputable institution to take day-to-day operation of investing and managing our portfolio is wise for the long haul. Here are the key points supporting my current strategy:
• We have more to lose than gain by doing it myself.
• I've learned the hard way that I don't know everything.
• My extreme tolerance to risk needs to be tempered by a professional.
• The 0.6 percent fee plus underlying expenses of mutual funds, averaging 0.8 to 1.2 percent, seem acceptable when compared to the downside risks associated with getting caught up in the psychology of the market.
• I recognize that my cognitive abilities have nowhere to go but down.