Reassessing Strategic Asset Allocation for a Retiree

David is a senior investment consultant working with a retiree client, Alice, who is 65 years old and looking to maintain her lifestyle through her retirement savings. Alice has a fairly conservative risk tolerance and wants to ensure that her investments are structured to provide steady income without significant fluctuations in her investment principal. Her current portfolio consists of 60% bonds and 40% equities. However, given the anticipated impact of rising interest rates and inflation, David believes that Alice's strategic asset allocation needs to be reassessed.

In your response, analyze the advantages and disadvantages of Alice's current asset allocation approach. Furthermore, recommend a revised strategic asset allocation that accounts for her risk tolerance, investment objectives, and current market conditions. Justify your recommendations with clear reasoning.