r/investing
Investing For Pension Holders = Different Mentality
Retirees with guaranteed pensions can afford aggressive, concentrated tech and semiconductor portfolios without needing dividend ETFs.
- Guaranteed pension income allows for higher risk tolerance and aggressive tech/semiconductor concentration.
- Ability to ride out market downturns without relying on traditional safe-haven assets like bonds or dividend ETFs.
"People who get to retire with a pension can afford to invest differently."
That statement is something that does not get talked about a lot. In the USA, around 24% of retirees have a pension. Everyone else is locked in to 401k's, IRA's, etc., or relying on government assistance with programs like Social Security. A pension is guaranteed income! Some of us will have a pension, Soc. Sec. payments, a military reserve retirement, and a VA rating on top of it all.
Because this person is not relying on a 401k, IRA, etc. to fund their retirement, they can be more aggressive and take bigger risks without jeopardizing their financial future. Regardless of what the stock market does, their pensions will continue to pay each month. This is why I invest heavily in technology and just ride out any downturn. Where others use bonds or something like SCHD as a safety net, I (and others like me) don't have to worry about that. Am I bragging? No, but conventional wisdom or investing strategies don't really apply, although some of those strategies are very sound and will work for just about anyone.
My portfolio does not contain any S&P 500. It does not contain any traditional growth ETF like SCHG or QQQM. It does not contain SCHD, FDVV, or DGRO. I firmly believe in ETF investing, but I am concentrated in big tech, so you'll find FTEC, AIS, SOXQ, DRAM, and QTUM, along some individual stocks like INTC, SPCX, APLD, and CRWV. I don't care about overlap. I do care about market crashes, but that's what alerts and stop-losses are for.
YMMV.