I'm in my mid 60s and I'm rolling $1.5 million into an IRA. I'd like to create a portfolio of 60% stocks and 40% bonds using low-fee ETFs and mutual funds. Is this a good plan -- and which funds and ETFs would you suggest? -- Ollie F.

Your plan is spot on.

The real beauty of it is your focus on keeping investment expenses down, a strategy that has the potential to boost returns by limiting the portion of the your investment's gain siphoned off by the fund company.

Most people understand that lower costs and higher returns can help them amass more savings during a career, but I'm not sure people appreciate the benefit of that combination in retirement -- it can substantially reduce the danger of running through your savings too soon.

Let's say you plan to withdraw an initial 4%, or $60,000, from your $1.5 million at age 65 and then increase that amount for inflation each year. And let's further assume that your annual expenses run 1.5% a year, a ballpark figure for people who invest in mutual funds and the like.

Reducing your investing costs by half a percentage point to 1% a year can lower your probability of running through your savings before age 95 by roughly 25%.

Reduce your yearly investing expenses a full percentage point to 0.5% -- which is doable if you stick to ETFs and index funds with the lowest expense ratios -- and your chances of running through your dough within 30 years may decline almost by half.

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There's no guarantee that you'll be able to duplicate these results exactly. That's because even though lower-cost investments do generally lead to higher returns, you can't be certain of getting a full percentage point in extra gain for each percentage-point reduction in expenses. So your results will depend, among other things, on the return your investments earn net of fees.

But to whatever extent lower expenses boosts your returns, your savings are likely to last longer at any given withdrawal rate. And that's a big deal in retirement, when the last thing you want to do is run out of money before you run out of time.

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Retirement IRA investing