Pensioner's Portfolio

Investing / Portfolios
1

Good morning everyone, I’m not too experienced yet so I’m writing to ask for advice on the portfolio for my father who is retired and lives in Italy.

  • 200K net worth
  • With his pension he covers his expenses and has €400 left over per month

Here is the simplest portfolio I’ve thought of:

3K liquidity in a current account
37K emergency fund on XEON monetary ETF
40K divided into government bonds with a maturity of 2, 4 and 6 years
40K Global Aggregate Accumulation Bond ETF
80K FTSE All-World Accumulation Equity ETF

With the €400 per month PAC on FTSE All-World

Please write to me what you think and what advice you would have for me.
Thank you

2

The portfolio would fit in some cases, but you need to think first about the goals:

  • What is age? What would be is life expectancy (based on family data and habits)?
  • What do he want to do with the money? use to increase his retirement lifestyle? give it to his wife or kids when he’ll pass away? Buy a house? use it to pay a retirement home?
1 Like
3

sorry for forgetting, then the age is 65 years and life expectancy is at least 15/20 years. The goal is to give the capital as an inheritance to the children and/or if necessary use the capital for a retirement home for him or his wife

4

That’s super vague, isn’t it? Option 1 (inheritance to children) allows more risk, option 2 (retirement home) very little. If Option 2 (retirement home) is a probable option, then go maybe even more defensive, i.e. lower the

proportion.

5

Unfortunately, it is not possible to know if the retirement home will be necessary or not and if so for how many years, so it is difficult to make assumptions. In general, how do you think the asset allocation is? Do you have any ideas for improving it or would you change something?

6

Dividend stocks instead of global stocks and all bonds?

Oh, so the goal is actually to grow the portfolio further? In this case I rather suggest to keep the emergency fund, but invest the rest in a distributing global ETF. Keep dividends for himself, let the rest grow.

7

Are there inflation-indexed bonds in EUR? That would be the type I would rather consider.

8

yes they exist, would you use it instead of the monetary etf? or how?

9

No, instead of long term bonds. I don’t trust bonds in general, but inflation protected ones I would not trust a bit less :laughing:.

1 Like
10

long term what do you mean? as you can see I would put about 15K on a 6 year bond and 40K on a bond ETF with bonds inside with an average instalment of 8 years

11

Note that those bonds often don’t do what people think they do. It’s more to bet or hedge on inflation expectation than protecting from inflation (not the same as US i-bond).

Afaik over longer periods of time bond typically beat inflation linked securities.