A judge takes the measure of her investments. By Jeffrey R. Kosnett, Senior Editor March 31, 2006 To say Adele Grunberg lives a rich life is an understatement. In the last decade, she's been to Africa three times and visited Nepal and New Zealand, as well as several Latin American countries. At home in Oakland, Cal., she mentors troubled young people, mediates family and workplace disputes, and arbitrates Holocaust-era insurance claims. And that's in her spare time. Adele works full time as an administrative law judge for the state of California, hearing unemployment-insurance and labor-law cases. Yet she still has plenty of energy to hike, bike and work out at the gym five times a week. Adele's investments are almost as wide-ranging as her activities. She has $400,000 in various retirement accounts, all in mutual funds. Three-fourths of the portfolio is in stock funds, with 30% of the total in foreign stock funds. Adele, 56, is comfortable with risk. "Bonds don't do anything for me," she says. "The older I get, the more adventuresome my travels, and my outlook is similar with my investments." Adele can afford to invest aggressively because pensions should cover the bulk of her living expenses after she retires. Her daughter, a college student, will soon be on her own, and Adele's husband is already retired. When she turns 60, Adele expects to cut back to two days a week, and she plans on leaving state government at 63. Then, she says, her life will really get busy. So, she wonders, is it time for a financial change of course? "I don't want to be foolish or careless," she says. The biggest error Adele could make would be to run scared. Investors approaching retirement are often overanxious to shed riskÑand rush prematurely into certificates of deposit and bonds. But Adele can expect to live at least 25 more years and won't spend less in retirement. In fact, the reverse may be true. Advertisement More aggressive. So for now, her growth-heavy approach is appropriate, says Donald Whalen, of Versailles Financial, in Atlanta. "She needs return, not income," he says. For allocation purposes, Adele's large California pension may be viewed as a bunch of bonds. So, Whalen says, she could even increase her stock allocation to 90%. Adele should be able to invest another $80,000 during her last few years as a judge. If she earns 8% a year, she'll have $750,000 to $800,000 by 63. If she then withdraws 4% of the principal a year (a commonly recommended schedule), she'll have $30,000 a year for travel and her numerous other activities. Trim the return to 4% and Adele might have to give up New Zealand for New Mexico -- or work part-time for pay instead of pro bono. Meanwhile, Adele can refine her holdings. She has a bit too much riding on financial services, emerging markets and natural resources. She also has way too many fundsÑ34 in all -- and many of them overlap. Ten to 15 should suffice. Fifteen of Adele's holdings represent positions of less than 2%. They're prime candidates for elimination, although several, such as Wasatch Heritage Growth and T. Rowe Price Health Sciences, are keepers. She should move the proceeds of these sales into better funds in which she has large positions, such as Longleaf Partners International, a fund that's closed to new investors.