Making a decision - measure twice cut once

• Making a decision about selling off some stock in 401k.

  Eventually all of this stock will be sold by RMD or inherited RMD

  Selling some now insures a minimum cash value

  Sell the Green=Profits

  Hold the base and let it grow

  Possibly ditch a couple losers because keep in mind EVERYTHING at this point is Profit.

  
  

  • Identify your goal.

  My goal is to have enough money in savings to cover any foreseeable expenses in our future for about 10 years - I’ll be 85, Tess 90

  
  

  • Gather information.

  I’ve read different ideas about investing and one statement stands out. It’s never a bad idea to take a profit 

  
  

  • Weigh the pros and cons of each option.

  The debate I find myself in is should I sell for a known profit vs hold for potential further gains?

  
  

  • Consider your values.

  We have more money than ever before but our lifestyle is stable and conservative. We don’t want to spend big money on travel or real estate. We own our home and the only unknown is whether Tess might need nursing care. I think a 500k savings would be more than enough to cover either one or both of us.

  
  

  • Trust your gut.

  I somehow feel attached to stock holdings but a fear that if they drop that I would fall from being wealthy to saying well, we used to have a lot of money.

  It’s that fear that makes me think the smart thing is to sell profits and yet hold for the potential of more profit. In other words do Both!

  
  

  • Take your time.

  This wealth has built up mostly over the past 12 years. I’ve lost about 100k value in the last 2 years

  The volatility is starting to concern me:

  Trumpsters do crazy things to destabilize our government and the economy.

  Interest rates are better than ever, 4% or better and principle is safe

  
  

  • Don't be afraid to ask for help.

  Fidelity advisor and Bard and common sense say Take a profit now. It’s money in the bank.

  
  

  • Be willing to compromise.

  My idea/plan is to sell off the green profits on Microsoft, Apple, Amazon and I’ve already done that with First Solar

  
  

  Don't be afraid to make mistakes.

  By selling off profits I don’t lose money I make money. Actual money that I can keep and grow albeit more slowly but more safely in savings. Selling while in my 401k I don’t create taxable capital gains. I only pay taxes on my RMD which is independent of capital gains outside of the 401k. So I’m just creating a cash reserve from which we will take our RMD every year for the next 10 years. So far, because we have fixed incomes we have not needed that RMD to maintain our lifestyle so I’ve reinvested it. We’ve also put money into Nolan and Wes’s education fund which will help them.

  
  

  I should be prudent, not greedy. Part of my fantasy is that I would be leaving Lauren a million dollars and somehow that feeds my ego BUT the reality is that she doesn’t need it or expect it and by selling off profits I actually preserve our gains rather than risk them. The ONLY RISK in selling is missing future gains. I will still reap future gains if the market goes up BUT I’ll have money if it goes down.

  The only major asset I want to buy and need is a nice car which at the most would be 100K.