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So say I have $20k in contributions to a government DB pension plan--can I just consider $20k (although technically, the value would be higher due to accrued interest etc) for simplicity as the "bonds" portion in my portfolio? That would eliminate my need to purchase any bond ETFs.

Is that a reasonable way of thinking of it on a whole?
 

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Link: Is a pension like a bond?

There are lots of different opinions on that. Pick the one you like.

I look at my pension (and CPP/OAS) as guaranteed income to meet my non-discretionary expenses. Then with my investments I pick an asset allocation I am comfortable with based on risk and volatility of the portfolio for my discretionary expenses.
 

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Some do consider a vested DB pension as a bond-equivalent because it will provide a predictable income stream, and so are more aggressive with the balance of their savings (i.e. equities). If you are young, you also have time on your side.
You do need to consider whether you are the type that can truly handle the increased volatility that your portfolio is likely to have (up/down of the markets).You may intend to hold tight when markets dive - but can you?
 

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I've been retired 10 years and my investments are 100% equities. That's because my living expenses are totally covered by income from my company DB pension, plus CPP & OAS. I consider those pensions to be equivalent to a large bond portfolio. OAS is not really a pension, but still guaranteed income. I hold no bonds or bond funds, or GICs.
 

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I would be doing the same thing as pwm if I were in that position. My excess funds would be for future generations so why not invest them that way.
 

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I'm 100% equities for the higher long term total return. Large cap dividend payers are the best long term investment you can make. I say that with almost 40 years of investment experience. There can be significant volatility in my portfolio but that is not the same thing as risk. Yes it's true that if you need to deplete your capital to live on, then getting jammed up selling at a market bottom hurts, but as I said, I don't need to sell anything for living expenses.
 

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Love the mindset pwm. I appreciate you sharing your investing experience. How many large cap payers do you own from Canada and abroad?

I also consider my small workplace pension "a future big bond". For this reason I hold no bonds, GICs, etc. today but I could see where I might want some in future years into my 60s when capital preservation is important.
 

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I am 72 with a RRIF but no DB pension. I will be forced to start taking withdrawals from my RRIF this year and want the choice of selling either fixed income or equity investments in any given year depending on relative performance and to maintain my target asset allocations.
 
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