Episode 484: Portfolio Considerations Pre-Retirement, Accounting For Taxes, Data, Catherine O'Hara And Portfolio Reviews As Of January 30, 2026

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Feb 1, 2026

They debate the role of treasury bonds as recession insurance and rebalancing dry powder. They sort how to count rental real estate — income stream or future lump sum. They call out goofy tax accounting and recommend modeling taxes as liabilities. They cover Social Security as an inflation‑adjusted cash flow and planning bridges. They review market movers like gold, small‑cap value, commodities, and portfolio performance.

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INSIGHT

Stability Isn't A Bond Substitute

An acceptable substitute for treasuries must reliably rise in recessions.
Stability alone is not equivalent to recession appreciation needed for rebalancing.

ADVICE

Treat Rentals As Either Income Or Asset

Classify rental properties as either income or future liquid assets, not both.
Subtract rental net income from expenses if you keep rentals as cashflow sources.

ADVICE

Trim Excess Cash Into Bonds

Reduce excess cash while working and consider moving it into treasury bonds.
Aim to keep cash below ~10% for high safe withdrawal rate portfolios.

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In this episode we answer emails from Sebastian, Mark, and James. We discuss the purpose of treasury bond allocations, annuity cash flows, and where rentals fit, goofy accounting for taxes, a bridge to social security and answer questions about Testfolio and data sources. And celebrate Catherine O'hara.

And THEN we our go through our weekly and monthly portfolio reviews of the eight sample portfolios you can find at Portfolios | Risk Parity Radio.

Additional Links:

Father McKenna Center Donation Page: Donate - Father McKenna Center

Portfolio Charts Article re Accumulation in an RP-style Portfolio: Minimize Your Miss – Portfolio Charts

Immediate Annuities: Immediate Annuities - Income Annuity Quote Calculator - ImmediateAnnuities.com

Portfolio Charts Data Sources Page: Data Sources – Portfolio Charts

Breathless Unedited AI-Bot Summary

Markets threw a curveball this week: gold ripped, then slipped; small cap value popped; long bonds mostly yawned. We use the noise as a lesson in clarity—every asset in a risk parity mix has a job. Treasuries aren’t for yield; they’re for recession insurance and rebalancing power when stocks sag. Gold, managed futures, and value are there to diversify return drivers so you’re not betting your future on a single story.

We dig into a listener’s Golden Ratio allocation with annuitized payouts and single-family rentals. The key is classification. Treat rentals as income if you’re keeping them, or as a future lump sum if you plan to sell—but don’t try to count both the cash flow and the equity for rebalancing. We also tackle the “can I replace treasuries with X?” question, and explain why the only valid substitute must reliably rise when recessions hit. If it won’t go up when growth falls, it isn’t doing the bond job.

From there, we clean up two planning snags that trip up even seasoned DIY investors. First, the tax myth: don’t “tax-adjust” asset values across accounts. Taxes are expenses, not asset haircuts. Optimize location, model annual tax liabilities, and keep the allocation true on the asset side. Second, Social Security modeling: the most practical move is to add it as an inflation-indexed future cash flow in a robust planner. If you need a present value for net worth, price a comparable inflation-adjusted deferred annuity instead of guessing with discount rates. For bridging years before benefits start, a TIPS ladder can unlock higher, earlier spending without warping your core portfolio.

We wrap with a clear performance snapshot and withdrawals across eight sample portfolios, from the classic Golden Butterfly and Golden Ratio to levered experiments and a return-stacked build. The thread through it all is discipline: know each asset’s purpose, keep cash intentional, rebalance when markets hand you spread, and let validated data—not hunches—drive decisions.

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