Investment philosophy for a retiree client

THIS is the fifth instalment of our retirement series. In my previous writings, I shared how I used our proprietary tool "RetireWell" to give our client, David (aged 59), a reliable income stream throughout his retiring years. (You can read the unedited version of the earlier articles at www.providend.com/articles/). In gist, David's retirement objectives are:

At the end of age 83, he wants to have S$1 million to leave behind for his loved ones or use it for himself if he lives longer.

Very briefly, based on what David wants, we allocated S$1.479 million of his money, together with his rental income and proceeds from his insurance policies, into various "buckets" shown in the accompanying graphic (Table 1). Monies in income bucket are used to buy annuities while in bucket 2 are used to buy bonds. The monies in the rest of the buckets are invested in portfolios as shown in Table 2.