Decumulation: No Cat Food retirement portfolio – Year 2 checkpoint [Members]

For MAVENS and MOGULS by The Accumulator on September 9, 2025

Hello Mavens and Moguls! We’re halfway through year two for our model retirement portfolio and I’m happy to report that its vital signs are looking good.

After years of accumulation, it’s hard to get used to the idea of extracting great chunks of your portfolio to fritter on items such as food, electricity, dental fillings, and whatever peculiar habits you’ve carried into your golden years.

This article can be read by selected Monevator members. Please see our membership plans and consider joining! Already a member? Sign in here.

Comments on this entry are closed.

Maven
1 Paul_a38 September 9, 2025, 4:38 pm

Thanks, as always, for your hard work.
I bought a multifactor fund for my SIPP – because you did, and now look :).
If AVSG is the Avantis fund I had a look and it’s 69% US, 10% Japan, 3 countries ( including UK) at 3% then every other country 1% or less. I know the US is a powerhouse so fair do but not sure I would view the fund as global.
Maven
2 DavidV September 9, 2025, 4:48 pm

Sorry to be the pedant here, but my remaining hair is white enough without ever having been hit by a lightening bolt (or, for that matter, a lightning bolt) 🙂 .
Maven
3 Mr H September 9, 2025, 5:09 pm

Hi Accumulator –

I love the simplicity of the portfolio. I am gradually working towards a “slimmed down” retirement portfolio for ease of maintenance.

Question – are you actually using / or intending to use this for your decumulation?
Mogul
4 The Accumulator September 9, 2025, 5:49 pm

@Paul – Yes, AVSG is developed world more like. US dominates of course. I still think a multi-factor ETF is a good choice – I think a lot of retirees would probably appreciate low vol exposure in their portfolios.

@DavidV – Blimey, that was a stinker! My editor should hang his head in shame 😉 Corrected! Thank you.

@Mr H – Yes, Mrs A and I are in a very similar portfolio. Asset allocations differ somewhat. I’ve personally split out global equities into Dev World and Emerging Markets ETFs. And I’ve recently extended the length of my linker holdings. I did trade FSWD for 50/50 AVSG/IWFM. Fair dollop of cash hanging around.
Mogul
5 Delta Hedge September 9, 2025, 7:44 pm

@Paul_a38 #1 & @TA #4: AVSG might be nearly 70% US but….Between 1926 and today, the 10% smallest US companies outperformed US large caps (the rest) by 4.4% per year (for 99 years!) on average. The smallest of the small (nano caps) and, of course, small value and nano value, all did even better. Put $1,000 to work in 1926. By today, you’d have:
Large caps: $8.7 mn
Small caps: $430 mn
Nano caps: $860 mn (nano = <$300 mn capitalisation)

Still, it's quite a bold call (as Sir Humphrey would say, "very courageous Minister") to ditch FSWD for AVSG. I've backed up the truck with AVSG, but I've still held onto all 3 of my multifactor ETFs, including FSWD.

Interesting you’ve kept Momentum exposure through IWFM.
Mogul
6 The Accumulator September 10, 2025, 8:56 am

@DH – ‘as Sir Humphrey would say, “very courageous Minister”‘ LOL.
Why 3 multifactor ETFs?
Mogul
7 Delta Hedge September 10, 2025, 9:58 am

Principle of indifference. I don’t know which of the 3 main multi factor ETF providers’ methodologies (JPM, HSBC or iShares, there were 3 when I brought in, it might be more now) will prove to have been the best, so I just spread across them all.
Mogul
8 Gareth Ghost September 10, 2025, 11:16 am

I use JPLG for multifactor exposure. It’s OCF at 0.2% cheaper than FSWD at 0.3%. It targets Value, Quality and Momentum, so I’m led to believe (large and mid-sized companies).
I also hold an equivalent amount in AVSG (small-value) and a Developed World ex-US (because their valuations make me nervous) developed world tracker (XMWX). This covers most bases for me: Small, Mid-sized and Large companies. Value, Quality, Momentum, Small-Value factors. With a reduced USA exposure to help me sleep at night (but which has cost me via reduced returns over the last ten years).
There’s also some Emerging Market exposure (VFEM and IEMS) covering Large and Smallish companies respectively. Oh, and an outsized UK exposure via LCUK, VMIG, ASL (Large, Mid and Small) because I’m an eternal optimist.
Maven
9 2 more years September 10, 2025, 8:42 pm

Brilliant resource, NCF unquestionably justifies the subscription on its own. Not to mention pertinent – getting very close now! Thanks so much @TA.
Maven
10 weenie September 12, 2025, 12:11 pm

Thanks for this – incredible that you are drawing down yet the portfolio has gone up to where you started 2 years ago!

I need to knuckle down and sketch out my own decumulation plans.
Mogul
11 Brod September 12, 2025, 9:43 pm

@TA – great update. I love this series and am looking forward to many years of updates.

So I’m going to use your benchmarking to benchmark my portfolio, along with VPW from Bogleheads. I’m 35% equities and 15% BHMG, which seems to give nearly equity like growth (while I hope still being my insurance policy if we all go to hell in a handcart.) I’m up 17.4% since April 24, but no withdrawals. Does your benchmarking against a vanilla 60:40 include withdrawals or just portfolio TR?

My gold is going totally bionic but with the crazies taking over the asylum, I don’t feel I can rebalance it… Famous last words. It’s currently an outsize 17%. But at the beginning of October I take my first post-FIRE withdrawal (6 months of personal allowance) and I think I’ll make that from gold rather than the Money Market funds I’ve set aside for the the next 7 years until SP and small Civil Service pension) arrives.

I’ve also set up an ISA income portfolio which is doing well. I think having dividend payers is like value-lite and a diversification from TR Global Tracker. And FREE MONEY!!! 😀
Maven
12 Trinity September 13, 2025, 4:41 pm

This series is proving very educational and timely – I am reading with great interest.

I am pretty sold on the McClung Prime Harvesting approach, but the one thing I can’t figure out is how to manage the asset allocation over time when your assets are split across different types of account. For tax efficiency reasons you might want to access them in some particular order (let’s say A then B). But if you sell all the bonds in pot A over the first few years, but still have some in the B, what do you do. Is it as simple as just switch some equities to bonds in A, while doing the reverse in B to keep things as they were?

Thanks!
Maven
13 DavidV September 13, 2025, 7:03 pm

@Trinity (12)
Well that would be one way of doing it. However, if tax considerations are causing you to prefer emptying A first, it’s equally possible that switching your equities and bonds as you suggest could have tax consequences. I think you just have to play this by ear and evaluate the consequential costs of following McClung rigidly.
Maven
14 Trinity September 13, 2025, 7:57 pm

@DavidV,

Ah ok, that’s a good point. In my case, I don’t think switching would incur tax (the pots in question are a SIPP, an ISA and an inherited SIPP).
Mogul
15 The Accumulator September 14, 2025, 1:50 pm

@Brod – I use time-weighted returns to compare the 60/40 with the NCF – so the effect of withdrawals is neutralised. Congrats on taking your first withdrawal. Hopefully taking money out instead of putting it in isn’t causing you any alarm?

@Trinity – yes, you’re right about the switch. Prime Harvesting works at the portfolio level, it doesn’t care which account your assets are in.

Making it work with the tax system and drawdown throws up all manner of quirks but nothing that can’t be handled with a trusty spreadsheet and a bit of steam shooting out the ears.