Those "retirement calculators" are copping out. The problem is that by asking you to make a prediction, they reinforce the idea that you can
make predictions, that you are supposed
to make predictions, and that investing is about
Larry Swedroe has a column on the accuracy of expert's forecasts
. The gist is right at the beginning: "There's an overwhelming body of evidence on the inability of forecasters to make accurate predictions... while it might be easy to make a living selling forecasts, it's very difficult for even the experts to make accurate forecasts."
If the experts can't make accurate forecasts, why would you think you or I could?
One of John C. Bogle's maxims is "Time is your friend. Impulse is your enemy." Investing based on your optimism or pessimism is investing on impulse. Do you really think that letting your optimism or pessimism direct your investments is sound? Oh, yes, of course we all do it, but it is something to be resisted as far as possible.
I wish I'd thought to capture the quotation, but in Future Babble: Why Expert Predictions Are Next to Worthless, and You Can Do Better
, by Dan Gardner--pretty good, not as good as The Fortune Sellers
, though--he makes the very cogent point that it always
seems that we live in a time of unprecedented uncertainty and chaos. We always
feel that there was a time in the past when things were "normal," but that today, the time is out of joint, things falls apart, the center cannot hold &c &c.
(Having lived through the 1950s, one of the things that really gets me is the crazy idea people have that it was some kind of golden age. Happy Days? The Brady Bunch? Leave It To Beaver?
Let me say this loud and clear: that was television
. Not real
. You know what? In the 1950s, married couples did not
sleep in twin beds--and bathrooms did
Annual income twenty pounds, annual expenditure nineteen nineteen and six, result happiness; Annual income twenty pounds, annual expenditure twenty pounds ought and six, result misery.