Search found 498 matches

by Ron Scott
Sun Feb 18, 2018 11:42 pm
Forum: Investing - Theory, News & General
Topic: How many of you use the "4% rule" during retirement?
Replies: 68
Views: 8065

Re: How many of you use the "4% rule" during retirement?

I have not seen anyone I respect actually recommend slavishly following the 4% rule as a withdrawal strategy. A big reason is that the 4% rule is designed to succeed in the worst of financial conditions. In the vast majority of economic periods the 4% rule limits the living standard of the retiree ...
by Ron Scott
Sun Feb 18, 2018 12:38 am
Forum: Investing - Theory, News & General
Topic: Retirees: The common sense withdrawal method
Replies: 128
Views: 10510

Re: Retirees: The common sense withdrawal method

Retirement, as we know it, is a post WWII concept. Before that most Americans didn't live that long and there wasn't Social Security. (SS benefits started on a small scale in the late 1930s.) Before the post war era most people worked until they weren't physically able and then they were cared for ...
by Ron Scott
Sat Feb 17, 2018 6:41 pm
Forum: Investing - Theory, News & General
Topic: Retirees: The common sense withdrawal method
Replies: 128
Views: 10510

Re: Retirees: The common sense withdrawal method

I'm not currently retired, but I have been mulling over a question for those who are. I intend to use the 4% rule to get me into the ballpark, but use common sense for the actual withdrawal method. I'd benchmark the withdrawals against the 4% number so I'd know roughly if I'm getting out of hand or...
by Ron Scott
Sat Feb 17, 2018 6:54 am
Forum: Investing - Theory, News & General
Topic: ETFs a cause of market turbulence?
Replies: 13
Views: 939

Re: Index funds a cause of market turbulence?

Great article and worth of discussion here... Here’s a problem quote: “But so much money has gone into just a few hundred stocks. Everyone owns the same stuff. So when they want to get out, who are they going to sell to?” If Apple’s business falters in an environment in which half the money in the m...
by Ron Scott
Tue Feb 13, 2018 9:06 pm
Forum: Investing - Theory, News & General
Topic: Morningstar's SWR study
Replies: 44
Views: 3434

Re: Morningstar's SWR study

Take a look at Wade Pfau's work on this topic. https://retirementresearcher.com/4-rule-work-around-world/ Using starting dates from 1900-1986 for 30 year retirements, he found that the SAFEMAX for a 'world portfolio' was 3.45%. I believe those whose investments allow them to just break even with in...
by Ron Scott
Tue Feb 13, 2018 8:54 pm
Forum: Investing - Help with Personal Investments
Topic: 4% rule and early retirement?
Replies: 69
Views: 8269

Re: 4% rule and early retirement?

Looks like the UK SWR was 3.05%, and 12 of the remaining nations had SWRs below 3%, including Switzerland, Australia, Norway, Ireland, Spain, Belgium, Finland, and France, among others. Everyone has to find their own comfort level, but I think the exceptional US historical experience lulls many of ...
by Ron Scott
Tue Feb 13, 2018 10:00 am
Forum: Investing - Theory, News & General
Topic: "Warren Buffett explains how to invest in stocks when inflation hits markets"
Replies: 9
Views: 3414

Re: "Warren Buffett explains how to invest in stocks when inflation hits markets"

I suppose that if a high margin company was thinking about lowering (real) prices to kill off competition, a great time to do it is when the competition is already suffering. Yes, and there's a corollary. High margin businesses are provocative. Regardless of inflation, if you have a strong competit...
by Ron Scott
Tue Feb 13, 2018 12:22 am
Forum: Investing - Theory, News & General
Topic: Expecting a crash...but staying the course
Replies: 8
Views: 1613

Re: Expecting a crash...but staying the course

Better yet if you can treat your stocks like a business you don't need to sell to live, and tell yourself that business is going to grow in 2 ways. First, through normal appreciation and dividend growth. Second through purchases of additional stock whenever there's a correction of 20% or more. "Buy ...
by Ron Scott
Tue Feb 13, 2018 12:14 am
Forum: Investing - Theory, News & General
Topic: SWR — Can You Include Real Estate as Part of Your Portfolio
Replies: 24
Views: 1395

Re: SWR — Can You Include Real Estate as Part of Your Portfolio

In the last analysis SWR is an educated guess so excluding real estate makes it a more conservative one and including it a riskier one. I would feel safer in excluding real estate although adding in 75% or so the current value of a non-primary place would probably be fine. Just realize that you're e...
by Ron Scott
Mon Feb 12, 2018 6:17 pm
Forum: Investing - Theory, News & General
Topic: "Warren Buffett explains how to invest in stocks when inflation hits markets"
Replies: 9
Views: 3414

Re: "Warren Buffett explains how to invest in stocks when inflation hits markets"

I never understood the accounting mechanism by which inflation hurts low margin companies which need new capital over time. Maybe it's to do with a delay in passing on price increases? There is no end to the variety of headaches that plague low margin businesses. Timing/cash flow, as you indicate, ...
by Ron Scott
Mon Feb 12, 2018 11:00 am
Forum: Investing - Help with Personal Investments
Topic: 4% rule and early retirement?
Replies: 69
Views: 8269

Re: 4% rule and early retirement?

Sandi_k wrote:
Mon Feb 12, 2018 12:35 am
That means we will NOT be using the 4% SWR - which includes 1% AUM, and a COLA every year.
To be sure, you're paying someone 1% AUM?
by Ron Scott
Sun Feb 11, 2018 11:16 pm
Forum: Investing - Help with Personal Investments
Topic: Advice with 401K with current market crash
Replies: 9
Views: 774

Re: Advice with 401K with current market crash

Hi I have 401K with John Hancock Pensions. I am in my 40s, had $1,00,000 and now $93,000 with market crash. I changed from JH Multimanager Balanced LS Allocation--50% To 70% Equity, Ticker Symbol+: JILBX , Risk 3 in 1-5 to JH Multimanager Growth LS ---- Allocation--70% To 85% Equity, Ticker Symbol+...
by Ron Scott
Sun Feb 11, 2018 10:30 pm
Forum: Personal Finance (Not Investing)
Topic: Yes, one is required to use the tax tables. So plan wisely to save a few dollars
Replies: 23
Views: 3480

Re: Yes, one is required to use the tax tables. So plan wisely to save a few dollars

I am both impressed and motivated! I don't care how much money you have, if someone offers you $25 for doing essentially nothing you take it. Thanks. Selling shares in taxable in an exacting quantity to "max out" a $50 table bracket, taking into consideration cost basis, tax rate on gains to save $...
by Ron Scott
Sun Feb 11, 2018 11:37 am
Forum: Investing - Help with Personal Investments
Topic: SEC Oversight: The Muni Bond/Bank Loan Thing
Replies: 1
Views: 221

SEC Oversight: The Muni Bond/Bank Loan Thing

Back last spring there was a flurry of activity by the SEC, trying to enhance their regulations regarding required reporting by municipalities about events that might impact investments in their bonds. I believe the catalyst was a growing practice by some towns of taking large bank loans, giving the...
by Ron Scott
Sun Feb 11, 2018 11:12 am
Forum: Investing - Help with Personal Investments
Topic: Cons of Rebalancing?
Replies: 4
Views: 430

Re: Cons of Rebalancing?

I actually thought the 2 responses you got were thoughtful ones. The savings you'd get by balancing yourself between a total bond and total stock market would amount to about 0.10% a year, which at your current level of savings is not an issue. Fast forward a couple decades and it may be; just know ...
by Ron Scott
Sat Feb 10, 2018 4:53 pm
Forum: Investing - Help with Personal Investments
Topic: With 25x Annual Expenses in Bonds, Does Asset Allocation Really Matter?
Replies: 28
Views: 2987

Re: With 25x Annual Expenses in Bonds, Does Asset Allocation Really Matter?

The only hole in the story I see is your early estimation of retirement expenses. I'm assuming you're going to work another 15-25 years here so... I am 61 and retired in 2017. I could not know it at 41 but more than 90% of my current net worth would be earned in the past 20 years of my life and my o...
by Ron Scott
Sat Feb 10, 2018 4:20 pm
Forum: Investing - Help with Personal Investments
Topic: rebalancing
Replies: 5
Views: 281

Re: rebalancing

If you wait a bit you might not have to rebalance at all and avoid selling stocks in a downturn...
by Ron Scott
Sat Feb 10, 2018 4:00 pm
Forum: Personal Finance (Not Investing)
Topic: Yes, one is required to use the tax tables. So plan wisely to save a few dollars
Replies: 23
Views: 3480

Re: Yes, one is required to use the tax tables. So plan wisely to save a few dollars

triceratop wrote:
Sat Feb 10, 2018 3:59 pm
Ron Scott wrote:
Sat Feb 10, 2018 3:54 pm
I am both impressed and motivated!

I don't care how much money you have, if someone offers you $25 for doing essentially nothing you take it.

Thanks.
The benefit is $25 times your marginal tax rate.
Your check is in the mail...

COD
by Ron Scott
Sat Feb 10, 2018 3:54 pm
Forum: Personal Finance (Not Investing)
Topic: Yes, one is required to use the tax tables. So plan wisely to save a few dollars
Replies: 23
Views: 3480

Re: Yes, one is required to use the tax tables. So plan wisely to save a few dollars

I am both impressed and motivated!

I don't care how much money you have, if someone offers you $25 for doing essentially nothing you take it.

Thanks.
by Ron Scott
Sat Feb 10, 2018 12:38 pm
Forum: Personal Finance (Not Investing)
Topic: What did you do: Life Annuity or Survivorship?
Replies: 14
Views: 954

Re: What did you do: Life Annuity or Survivorship?

Interesting study by the Society of Actuaries, from 2003. "Results": Overall, 28 percent of married men and 69 percent of married women opt for single life annuities instead of joint and survivor annuities. Although this choice may jeopardize their spouses’ economic security if they become widowed, ...
by Ron Scott
Sat Feb 10, 2018 12:38 pm
Forum: Personal Finance (Not Investing)
Topic: What did you do: Life Annuity or Survivorship?
Replies: 14
Views: 954

Re: What did you do: Life Annuity or Survivorship?

David Jay wrote:
Sat Feb 10, 2018 12:34 pm
What are we talking about, pension plan choice?
Yes, sorry...
by Ron Scott
Sat Feb 10, 2018 12:21 pm
Forum: Investing - Theory, News & General
Topic: Larry Swedroe: 4 Horsemen Of Your Portfolio
Replies: 108
Views: 10335

Re: Larry Swedroe: 4 Horseman Of Your Portfolio

Here's the thing: If you "need" 4% you've probably lost the game. Implicit in the 4% Rule is the American Consumer model that each of us must at least “live up to” our “means” or we’re just not living properly. Think about it. If I retire with a $5M nest egg, twice as much as Joe’s and half as much...
by Ron Scott
Sat Feb 10, 2018 11:51 am
Forum: Personal Finance (Not Investing)
Topic: What did you do: Life Annuity or Survivorship?
Replies: 14
Views: 954

What did you do: Life Annuity or Survivorship?

I'm 61. I ran the numbers in a spreadsheet and the survivorship benefit doesn't look fantastic if I live to my projected SS age of 82. Its great if I die in my 70s! My wife is my age too. She says she thinks the survivorship rates are a rip off but I suspect that's her intellectual reaction and that...
by Ron Scott
Fri Feb 09, 2018 3:52 pm
Forum: Investing - Help with Personal Investments
Topic: 4% rule and early retirement?
Replies: 69
Views: 8269

Re: 4% rule and early retirement?

marcopolo wrote:
Fri Feb 09, 2018 3:26 pm
Yes. I did start my retirement this morning, hopefully not into a really bad sequence of returns!
A BIG congrats!

May the downturn portend a buying opportunity that fills your sails.
by Ron Scott
Fri Feb 09, 2018 3:06 pm
Forum: Investing - Help with Personal Investments
Topic: 4% rule and early retirement?
Replies: 69
Views: 8269

Re: 4% rule and early retirement?

The only thing i was pointing out in your original post was your statement about not knowing if the future will be like the past, and not pretending to know. It came a cross as a bit critical/condescending of others who look at history as a guide to future market expectations. I meant to be critica...
by Ron Scott
Fri Feb 09, 2018 2:34 pm
Forum: Investing - Help with Personal Investments
Topic: 4% rule and early retirement?
Replies: 69
Views: 8269

Re: 4% rule and early retirement?

Even if America’s best days are behind it, (which I personally believe is not true), investors can now invest anywhere in the world with very low expenses using ETFs etc. Unless you believe that the whole world is going to have slow growth, there will be opportunities to invest for higher returns. ...
by Ron Scott
Fri Feb 09, 2018 2:21 pm
Forum: Investing - Help with Personal Investments
Topic: 4% rule and early retirement?
Replies: 69
Views: 8269

Re: 4% rule and early retirement?

If not looking at the past, on what do you base your 3-3.5% ? Yep, that's the question and you might not like my answer, but here goes. I'm triangulating into it, looking at the future like this: 1. I believe my grandparents, parents and I have lived during a Golden Age in America. Sure, we had war...
by Ron Scott
Fri Feb 09, 2018 12:11 pm
Forum: Personal Consumer Issues
Topic: Best TV options for multiple residences?
Replies: 9
Views: 511

Re: Best TV options for multiple residences?

A true wealth of info here folks! Thank you.
by Ron Scott
Fri Feb 09, 2018 11:10 am
Forum: Personal Consumer Issues
Topic: Best TV options for multiple residences?
Replies: 9
Views: 511

Best TV options for multiple residences?

We now have 3 residences (don't ask) and I'm looking for an economical way to run the TV programming. I believe I can use my Amazon and Netflix subscriptions at each place. I pay for HBO in one place now. I think we mostly watch ABC/NBC/CBS and CNN.

Any ideas?
by Ron Scott
Fri Feb 09, 2018 9:06 am
Forum: Investing - Help with Personal Investments
Topic: Started first big investment 2 weeks ago - Sell quick?
Replies: 29
Views: 1848

Re: Started first big investment 2 weeks ago - Sell quick?

RRAAYY3 wrote:
Fri Feb 09, 2018 9:04 am
It’s literally the last thing you should do

Let time work it’s magic especially in a Roth. Leave it alone
Absolutely!

Selling now just guarantees you the loss.

The thing to start thinking about now is buying, not selling.
by Ron Scott
Fri Feb 09, 2018 8:54 am
Forum: Investing - Theory, News & General
Topic: Feeling good about the market's direction. Wish it would drop more...
Replies: 14
Views: 2258

Re: Feeling good about the market's direction. Wish it would drop more...

Everyone's situation is different. If you're 30 years old and 50-50, a significant correction could push you to 70-30. If you're 70 and 50-50 not so much. And if you're retired, living on a 2% withdrawal rate, and don't even need your current stock portfolio to live off, then call it dry powder or w...
by Ron Scott
Fri Feb 09, 2018 6:42 am
Forum: Investing - Theory, News & General
Topic: Feeling good about the market's direction. Wish it would drop more...
Replies: 14
Views: 2258

Feeling good about the market's direction. Wish it would drop more...

2 of my favorite Buffet quotes are: “An investor should act as though he had a lifetime decision card (about his ability to buy stocks) with just twenty punches on it.” AND "The NYSE is one big supermarket of companies. And you are going to be buying stocks, what you want to have happen? You want to...
by Ron Scott
Fri Feb 09, 2018 6:02 am
Forum: Investing - Theory, News & General
Topic: Larry Swedroe: 4 Horsemen Of Your Portfolio
Replies: 108
Views: 10335

Re: Larry Swedroe: 4 Horseman Of Your Portfolio

Considering how much planning and discipline is required to assemble an admirable retirement portfolio the SWR question itself is pretty strange: “What is the greatest amount of money I can spend annually before I face a reasonable chance I will go bankrupt when I’m old and die in poverty?” LOL, li...
by Ron Scott
Fri Feb 09, 2018 5:03 am
Forum: Investing - Theory, News & General
Topic: Larry Swedroe: 4 Horsemen Of Your Portfolio
Replies: 108
Views: 10335

Re: Larry Swedroe: 4 Horseman Of Your Portfolio

Considering how much planning and discipline is required to assemble an admirable retirement portfolio the SWR question itself is pretty strange: “What is the greatest amount of money I can spend annually before I face a reasonable chance I will go bankrupt when I’m old and die in poverty?” LOL, li...
by Ron Scott
Thu Feb 08, 2018 11:39 pm
Forum: Investing - Help with Personal Investments
Topic: 4% rule and early retirement?
Replies: 69
Views: 8269

Re: 4% rule and early retirement?

If I am right and ignored, you'll be broke at 80-something or worse and subject to the generosity of your kids or the vicissitudes of some future government body for your wellbeing. If your right at some point along the way you will adjust spending to match reality. Nobody is going to follow the pa...
by Ron Scott
Thu Feb 08, 2018 11:36 pm
Forum: Investing - Help with Personal Investments
Topic: 4% rule and early retirement?
Replies: 69
Views: 8269

Re: 4% rule and early retirement?

We simply do not know what future returns will be and it is not prudent to pretend we do. I will not. Here's what I think a prudent answer to your situation is: Assume that over time, if you invest wisely, you will generally keep pace with inflation. Those two thoughts seem quite contradictory. You...
by Ron Scott
Thu Feb 08, 2018 10:08 pm
Forum: Investing - Theory, News & General
Topic: Larry Swedroe: 4 Horsemen Of Your Portfolio
Replies: 108
Views: 10335

Re: Larry Swedroe: 4 Horseman Of Your Portfolio

What kind of returns are people expecting? We recommend the 4% "rule" around here just in case returns are poor. Because 4% worked in the past even when returns are poor. "Around here" I've seen more than a few comments that 4% is too conservative and 5-7% more reasonable. I've seen posts that reco...
by Ron Scott
Thu Feb 08, 2018 7:38 pm
Forum: Investing - Help with Personal Investments
Topic: 4% rule and early retirement?
Replies: 69
Views: 8269

Re: 4% rule and early retirement?

The 4% Rule is born of studies using historical data and wet-nursed by modern Monte Carlo techniques and tools like Firecalc that quickly create highly individualized SWR assessments—all of which are designed to apply to you personally and all based on that same little file of historical data. You c...
by Ron Scott
Tue Feb 06, 2018 2:11 pm
Forum: Investing - Help with Personal Investments
Topic: Buy Low, Don't Sell
Replies: 38
Views: 5370

Re: Buy Low, Don't Sell

But therein lies the beauty of the 'going back in time analogy', when you do that today, you still only end up in December 2017...so it really drives home that what happened in January was probably the oddity on the block and not what happened the last couple of days (based on S+P500) - what do I c...
by Ron Scott
Mon Feb 05, 2018 11:53 pm
Forum: Investing - Help with Personal Investments
Topic: Buy Low, Don't Sell
Replies: 38
Views: 5370

Re: Buy Low, Don't Sell

Just to reiterate the obvious, a 10% correction on July 1 — for example — doesn’t even mean that you will be buying at a lower price than you would have if you bought on January 1. If the market goes up 20% from January 2 through June 30, you’d have bought cheaper on January 1. Sure, but everyone w...
by Ron Scott
Sun Feb 04, 2018 10:54 pm
Forum: Investing - Help with Personal Investments
Topic: The big 5-0 and financial check up-advice please
Replies: 9
Views: 1652

Re: The big 5-0 and financial check up-advice please

My experience is that significant expenses for kids change as they age but go on for a long long time, although that will vary by family of course and you know yours better than we do. If you're budgeting nothing, adding 5-10% to your NW before retiring would be prudent.
by Ron Scott
Sun Feb 04, 2018 10:45 pm
Forum: Investing - Help with Personal Investments
Topic: I've never rebalanced - Can I do ok without it?
Replies: 35
Views: 4198

Re: I've never rebalanced - Can I do ok without it?

Holding is fine if that is really what you're doing. If you find yourself in retirement and determine that you may NEED to withdraw from equities for living expenses during the coming decade or so, i.e., NOT HOLD, then selling some equities to rebalance might make sense. If you're not in a position ...
by Ron Scott
Sun Feb 04, 2018 2:54 pm
Forum: Investing - Help with Personal Investments
Topic: Buy Low, Don't Sell
Replies: 38
Views: 5370

Re: Buy Low, Don't Sell

I look at it a bit simplistic, but whenever the market corrects itself I look at a chart covering 10 years or more and go back to when the current price had the same price of the stock in the past - and when I buy in, its basically like I invested much earlier in life, so I can correct past mistake...
by Ron Scott
Sun Feb 04, 2018 2:51 pm
Forum: Investing - Help with Personal Investments
Topic: Buy Low, Don't Sell
Replies: 38
Views: 5370

Re: Buy Low, Don't Sell

How about this for clear and simple and devoid of emotion: When the S&P 500 falls by 25%, BUY into it. And a supplemental rule: Buy an amount equal to 4% of non-equity holdings. (You pick the percentage.) Using what money? "non-equity holdings" Sorry. I should have read more carefully. So the schem...
by Ron Scott
Sun Feb 04, 2018 12:05 pm
Forum: Investing - Help with Personal Investments
Topic: Buy Low, Don't Sell
Replies: 38
Views: 5370

Re: Buy Low, Don't Sell

dbr wrote:
Sun Feb 04, 2018 11:51 am
Ron Scott wrote:
Sun Feb 04, 2018 11:39 am


How about this for clear and simple and devoid of emotion: When the S&P 500 falls by 25%, BUY into it.
And a supplemental rule: Buy an amount equal to 4% of non-equity holdings. (You pick the percentage.)
Using what money?

"non-equity holdings"
by Ron Scott
Sun Feb 04, 2018 11:39 am
Forum: Investing - Help with Personal Investments
Topic: Buy Low, Don't Sell
Replies: 38
Views: 5370

Re: Buy Low, Don't Sell

The best (and easiest) strategy is just to put the same amount of money into the same funds at set interval periods. That way you still lower your average share cost through DCA while not having to worry about timing the market hills and valleys. Just keep it simple! ...there are countless threads ...
by Ron Scott
Sat Feb 03, 2018 9:37 pm
Forum: Investing - Help with Personal Investments
Topic: Buy Low, Don't Sell
Replies: 38
Views: 5370

Buy Low, Don't Sell

When people talk about making significant mistakes in investing its usually related to nervousness that ends in selling low, at a loss, when the market is in a correction. I'm more concerned with not buying low --when the market is in a correction. I know most of you will rail against market timing ...
by Ron Scott
Sat Feb 03, 2018 8:11 pm
Forum: Personal Finance (Not Investing)
Topic: Opening an LLC for investing: tax advantages?
Replies: 12
Views: 1363

Re: Opening an LLC for investing: tax advantages?

So your personal savings and investments qualify as a business?I know nothing about it but it sounds ridiculous and to think that one penny would qualify as a pass-through deduction is more ridiculous.As a former real business owner it really actually is extremely irritating to think this could pos...
by Ron Scott
Sat Feb 03, 2018 10:33 am
Forum: Personal Finance (Not Investing)
Topic: AMT People...
Replies: 4
Views: 891

AMT People...

I retired in 2017 and haven't run the YOY comparison because I'm apples and oranges.

Is the windfall all that?