Managing Dad's 401k!

My Dad retired at age 62 at the beginning of the year after 35 years with his company. He had a few things going for him in retirement including an old style pension (what I call a "dinosaur" pension), the ability to start collecting social security (he could have waited till age 65 but I ran a thousand scenarios and he was going to need the income), a lump sum cash payout for retiring early, and the fact that my Mom still works. He also had a 401k that needed to be rolled over to an IRA. I went to task figuring out what to do with it. He needed his 401k to last 10 years when his house was paid off. So I targeted a very conservative return of 4% to last him 12 years (to give him some cushion). Here is the list funds I decided on. The funds are being bought a little bit at a time ranging from 4 to 12 months.

Ameritrade money market fund -25% of portfolio. Current yield 4.41%. So, if my target return is 4%, why not put all the money here? I'm just not sure that money market rates are going to stay this high, so I wanted to invest in some other things to have a foundation of investment.

T Rowe Price Equity Income Fund - PRFDX - 20% of portfolio. While I think it unusual to have this money in a stock fund, he is still 12 years out from the final use of the money, so this could be a holding for 5 to 7 years which should be enough time to wait out any potential downturns.

American Funds High Income - AHITX - 10% of portfolio. Very similar to the T Rowe Fund, with the same idea of holding for 5 to 7 years.

Vanguard REIT index - VGSIX - 10% of portfolio. Designed to give Dad some exposure to real estate at a small clip (only 10% of portfolio). I am most worried about this fund but so far has been the best returner since he has owned it.

Vangurard GNMA -VFIIX - 25% of portfolio. A good safe fund invested in high quality mortgage pass through certificates. Hasn't had a down year in 7 years and has a 5-year average return of 5.25%

Vanguard Fixed Income Security Inflation Protection- VIPSX - 10% of portfolio. Good safe fund invested in US Treasuries.

And there it is. As I said above, after 5 to 7 years, we will have to take steps to make the investments a lot more safer with less risk, but thus far this year we are right on target for the return he needs. He should have had return of $1,380 so far and we have achieved a return of $2,050 ($1,410 of dividends/interest and $640 of capital appreciation). I monitor this monthly and will keep updating with an occasional post. My idea is to have a average return of 4%, which means it might be good to get a return of 7 to 8 percent in the earlier years, so a safer return of 3% could be done in the later years.