Will this be a routine (terrific) year for our retirement portfolio?
Posted on October 23, 2026

It’s a bit over five weeks before I take our RMDs and sell securities to get most all the cash I budget to pay ourselves for our spending for 2027. Unless something wild happens in the next five weeks, it will be a terrific, routine year: our portfolio is up +7% real return.

Anyone with a portfolio that is similar to ours going to calculate to a real increase in their Safe Spending Amount (SSA, Chapter 2, Nest Egg Care) for the upcoming year: you sold-withdrew less than 7% last year, so you now have more in real spending power than before your withdrawal last year. That will be three “pay” increases in a row.

I’m happy that it looks like we’ll calculate to a real “pay” increase, but I consider it to be a terrific year when stocks have not tanked. I don’t want the anguish that I faced at the end of 2022. I was looking at a deep hole from the -18% real decline for stocks, and selling stocks then would have made that hole a lot deeper. I sold our Reserve that I held in bonds for our spending in 2023. That was “one year” of bond insurance that I sold, and we now have three more years of insurance. I hope to never use our bond insurance again, but I know the odds are roughly 1 in 10 that we’ll hit a year of -20% real return or worse.

I show status of our portfolio as of yesterday’s close.

Details:

I see these highlights and tasks I’ll need to complete the first week of December.

1. Our real portfolio return YTD = +7.5%: +one percentage point greater than our expected portfolio return of ~6.4% based on 7.1% for S and 2.3% for B. That’s from our mix of stocks at ~10% real return and bonds -4% real return. (That means bonds have declined about 25% in spending power over the past six years.)

2. My habit is to sell securities the first week of December to get cash (money market) for our spending for the upcoming year. I’ll solely sell stocks for our spending this year, but then I’ll have to sell more stocks to buy ~4% more bonds just to get back them to the same real spending value that they had a year ago; I’ll do that transaction in our retirement accounts. (Last year I “pre-balanced” the first week of November; I’ll wait to the first week of December this year.)

[Note: I no longer rebalance to a fixed percentage mix of S&B after our withdrawal for spending; Patti and I are at the point where I budget to sell-withdraw the same real amount for our spending each year: our SSA has increased since December 2014, to well beyond our desire-capacity to spend it. I now target now to keep three years of spending in bonds; after my sale this December, I could wait four years before having to sell any stocks.]

Conclusion: I’m getting close to the time I’ll officially recalculate to find our Safe Spending Amount for the upcoming year. At the 47-week mark, our portfolio return is +7% real return. I’ll have more at the end of this year than I had before our withdrawal for our spending last year. (You’ll have more then, too.) That mean I have to calculate to a real increase in our SSA. That’s great, but I am happiest that stocks did not crater as they did in 2022. I don’t have to look into a deep hole and ponder selling more that would make the hole deeper.