RJ Fire@rj_fire · 6moEdited I thought about this for a long time. Like many people, I started from the traditional assumption that retirement means entering a “decumulation phase” — holding a meaningful amount in cash (or other safe, liquid assets) so you can sell those instead of equities during downturns.
I even hired a fee-only retirement advisor to map everything out — highly recommend, by the way.
That process was valuable, but it also made something clear: my DIY investing style and risk tolerance don’t really align with the idea of “stepping back” and managing my portfolio less actively just because I have more time and a clearer mind. For me, that felt like settling into a passive approach when I’m actually most capable of being engaged.
So I landed on a different structure that fits me better: splitting the portfolio into two buckets — growth and PII (Passive Income Investing).
With this approach, I still keep a “war chest,” but it’s much smaller. The reason is simple: the income stream does part of the heavy lifting. Yes, payouts can fluctuate, but if the PII sleeve is built with some defensive components, it continues to generate income even in tougher markets.
That, in turn, reduces the need to sell assets month to month, lowers the anxiety of timing sales during downturns, and gives you real breathing room.
And importantly — this isn’t just theoretical. This year’s market ups and downs have been a real-world test, and so far, this structure has been holding up well and serving me as intended.
