Search found 37 matches

by konic
Thu Jul 16, 2020 8:28 pm
Forum: Investing - Theory, News & General
Topic: 4% rule - confidence poll
Replies: 457
Views: 26626

Re: 4% rule - confidence poll

Wow! 8 pages :shock: on another endless ‘4% rule’ back and forth that doesn’t change anybody’s mind. On either side. :oops:
by konic
Tue Jul 14, 2020 10:42 pm
Forum: Investing - Theory, News & General
Topic: [Vanguard partners with Infosys for Defined Contribution recordkeeping]
Replies: 260
Views: 16095

Re: Vanguard laying off 1300 employees as part of outsourcing deal with Infosys

LazyNihilist wrote:
Tue Jul 14, 2020 10:38 pm
A little bit of satire and a little bit of truth.
https://www.youtube.com/watch?v=rYaZ57Bn4pQ
That is hilarious! :mrgreen: Thanks for that. This thread needed a lighter touch.
by konic
Sun May 03, 2020 3:10 pm
Forum: Investing - Theory, News & General
Topic: Year 2000 retirees using the '4% rule' - Where are they now?
Replies: 718
Views: 105530

Re: Year 2000 retirees using the '4% rule' - Where are they now?

2000-to date Total Bond had a 5% CAGR and in the first part of the period 2000-2009 had an annualized return of almost 6.1%. Today bonds are yielding close to zero and the expectation is that they are going to stay there for the long term. In addition inflation was relatively low during the entire ...
by konic
Sun Apr 26, 2020 6:07 pm
Forum: Investing - Theory, News & General
Topic: Future 60/40 Portfolio has a 43% Chance of Failing with 4% Withdrawal Rate
Replies: 622
Views: 32144

Re: Future 60/40 Portfolio has a 43% Chance of Failing with 4% Withdrawal Rate

Once Vineviz and Willthrill81 get done trying to outsmart each other, we’re left where we’re always left on these discussions: 1. The 4 percent rule is not a rule, but a guideline. 2. Nevertheless, a 4 percent withdrawal rate has worked almost all of the time over a very long retirement period. If ...
by konic
Wed Apr 22, 2020 12:31 am
Forum: Personal Investments
Topic: (3FP) - How much intl?
Replies: 18
Views: 1177

Re: (3FP) - How much intl?

Yayyyy.. another soon to be never ending circular argument on domestic vs international

Yippee...

:oops:
by konic
Wed Apr 22, 2020 12:20 am
Forum: Personal Finance (Not Investing)
Topic: Any One-More-Year FIRE people sticking to their plan?
Replies: 72
Views: 8534

Re: Any One-More-Year FIRE people sticking to their plan?

I would not consider it with those assets. Nice to have that much but nowhere close to enough to fund a reliable 50 year retirement. To quit responsibly at your age, you should have at least 5 fold your assets. That would be just enough, if you were lucky and the next half century goes your way. Te...
by konic
Sun Apr 19, 2020 11:53 am
Forum: Personal Finance (Not Investing)
Topic: What factors influenced you to maintain a perpetual mortgage balance on your primary residence?
Replies: 28
Views: 2327

Re: What factors influenced you to maintain a perpetual mortgage balance on your primary residence?

Setting aside liquidity, mortgage only makes sense if you are in accumulation seeking to leverage low interest debt to boost investment returns. I don't see the point for anyone who is at the point of holding bonds to reduce risk. At that point, your leverage cancels out your bond allocation from a...
by konic
Sun Apr 19, 2020 10:12 am
Forum: Personal Investments
Topic: Different Spin on the question of "Should I pay of the house or Invest.."
Replies: 73
Views: 4651

Re: Different Spin on the question of "Should I pay of the house or Invest.."

I think this issue is complicated and hence can only have a personalized solution. Unique to each investor’s situation. Have you also considered the impact of lowering cash flow requirement in ER in the ACA plans you might get? By paying of mortgage, you will lower the amount of taxable income requi...
by konic
Wed Mar 25, 2020 4:06 pm
Forum: Investing - Theory, News & General
Topic: Will the Dow ever see 29500 again?
Replies: 86
Views: 8784

Re: Will the Dow ever see 29500 again?

Crushtheturtle wrote:
Sun Mar 22, 2020 8:38 pm
Can you imagine a world in which we can't cure the cold virus?

Utter chaos. Permanently low stock market.

Cats and dogs, living together.
:D This is hilarious :mrgreen:
by konic
Mon Mar 09, 2020 8:49 pm
Forum: Investing - Theory, News & General
Topic: Are any early accumulators thankful for the current correction?
Replies: 185
Views: 10350

Re: Are any early accumulators thankful for the current correction?

Fixing a mistake on my part regarding looking up YTD returns for VTWAX... So, I just checked and figured that we are less that 10% down YTD on VTWAX. Plus, long terms bonds have a YTD close to 4%. On balance, meh...I guess we have a ways to go before a true buying opportunity presents for a balanced...
by konic
Thu Feb 20, 2020 8:53 am
Forum: Personal Finance (Not Investing)
Topic: Paying "early" on mortgage may be unwise
Replies: 298
Views: 29120

Re: Paying "early" on mortgage may be unwise

I am not sure if someone already brought this up, but there is another important aspect to the mortgage payoff decision with regards to the FI/RE planning. Paying off mortgage before FI/RE will reduce the expense to be budgeted in RE. This can help better manage the subsidy loss due to going over th...
by konic
Tue Feb 18, 2020 6:08 pm
Forum: Investing - Theory, News & General
Topic: 4% SWR: It is not a rule and it is not safe (anymore).
Replies: 273
Views: 18919

Re: 4% SWR: It is not a rule and it is not safe (anymore).

Did we really need another thread on this tired and beaten to death topic? :oops: Everyone of these ‘4%’ rule topics devolves into a partisan bickering with all the usual suspects arguing past each other on why the other side is mistaken. Let’s move on to better topics. This forum is getting too rep...
by konic
Tue Dec 24, 2019 10:51 am
Forum: Investing - Theory, News & General
Topic: U.S. stocks continue to soar!
Replies: 7425
Views: 604001

Re: U.S. stocks continue to soar!

Everyone saying 2020 is looking good, clear skies ahead. That makes me nervous. Terrifying, isn't it? :happy I keep buying anyway hoping for extra laps around the go-cart track, but up markets make me significantly more anxious than down markets. That's just how I'm wired. Me too. My anxiety is pea...
by konic
Tue Nov 26, 2019 5:52 pm
Forum: Investing - Theory, News & General
Topic: Flaws with 4% Rule?
Replies: 37
Views: 5102

Re: Flaws with 4% Rule?

When you are using a hammer to pound in a nail, miss it slightly and crush your finger ... do you blame the hammer? :mrgreen: :oops:

ps: my comment is in general about the whole argument about the 4% thingy
by konic
Sat Nov 09, 2019 1:14 am
Forum: Personal Investments
Topic: Will we be OK at 3% WR?
Replies: 342
Views: 26398

Re: Will we be OK at 3% WR?

Maybe you skipped where I wrote that 30-years average returns have never been too different from 10/7.5 (especially after factoring in inflation). There is a table I linked in the previous page showing that 1966-1995 was typical. That's false on two levels. First, 30 year returns have not been pred...
by konic
Mon Sep 30, 2019 10:18 pm
Forum: Personal Investments
Topic: Early semi-retirement abroad
Replies: 26
Views: 3742

Re: Early semi-retirement abroad

OP, You have access to a lot of tax-deferred space which can be maximally utilized to reduce current taxes and also accelerate savings. Since your estimated expenses in early retirement 5 years from now is ~22k, you taxes will be close to 0 then. Why pay more taxes now to pay low taxes later? What ...
by konic
Mon Sep 30, 2019 9:26 pm
Forum: Personal Investments
Topic: Early semi-retirement abroad
Replies: 26
Views: 3742

Re: Early semi-retirement abroad

OP, You have access to a lot of tax-deferred space which can be maximally utilized to reduce current taxes and also accelerate savings. Since your estimated expenses in early retirement 5 years from now is ~22k, you taxes will be close to 0 then. Why pay more taxes now to pay low taxes later? What a...
by konic
Sat Sep 21, 2019 12:05 pm
Forum: Investing - Theory, News & General
Topic: Wade Pfau: Does The 4% Rule Work In Today’s Markets?
Replies: 149
Views: 12689

Re: Wade Pfau: Does The 4% Rule Work In Today’s Markets?

We have this discussion every few months. I don't think a single mind has been changed. But, it is illuminating. My only goal is to keep a random 65-year old from dying at her desk at age 70, because she was new here, and read some silly 2% thread that got her scared and thinking she needed to work...
by konic
Sat Sep 21, 2019 9:35 am
Forum: Investing - Theory, News & General
Topic: Wade Pfau: Does The 4% Rule Work In Today’s Markets?
Replies: 149
Views: 12689

Re: Wade Pfau: Does The 4% Rule Work In Today’s Markets?

We have this discussion every few months. I don't think a single mind has been changed. But, it is illuminating. My only goal is to keep a random 65-year old from dying at her desk at age 70, because she was new here, and read some silly 2% thread that got her scared and thinking she needed to work...
by konic
Fri Sep 20, 2019 10:48 pm
Forum: Investing - Theory, News & General
Topic: Wade Pfau: Does The 4% Rule Work In Today’s Markets?
Replies: 149
Views: 12689

Re: Wade Pfau: Does The 4% Rule Work In Today’s Markets?

No, do not try to take refuge by deflecting your poor inputs into a model by trying to pass it off as Damodaran’s or anybody else’s predictions for the future. As far as I know, Damodaran has made no claims like you have regarding very poor returns couple with high volatility for the NEXT 50 YEARS....
by konic
Fri Sep 20, 2019 12:30 pm
Forum: Investing - Theory, News & General
Topic: Wade Pfau: Does The 4% Rule Work In Today’s Markets?
Replies: 149
Views: 12689

Re: Wade Pfau: Does The 4% Rule Work In Today’s Markets?

No, do not try to take refuge by deflecting your poor inputs into a model by trying to pass it off as Damodaran’s or anybody else’s predictions for the future. As far as I know, Damodaran has made no claims like you have regarding very poor returns couple with high volatility for the NEXT 50 YEARS....
by konic
Thu Sep 19, 2019 10:57 pm
Forum: Investing - Theory, News & General
Topic: Wade Pfau: Does The 4% Rule Work In Today’s Markets?
Replies: 149
Views: 12689

Re: Wade Pfau: Does The 4% Rule Work In Today’s Markets?

~2ish SWRs for 50 year periods. Using blocks of years can help with the overestimation of SORR but to employ that technique you've got to use historical data which is not ideal (esp if only back to 1972) because it assumes we've already been exposed to all risks/worst outcomes in that limited datas...
by konic
Thu Sep 19, 2019 8:29 pm
Forum: Investing - Theory, News & General
Topic: Wade Pfau: Does The 4% Rule Work In Today’s Markets?
Replies: 149
Views: 12689

Re: Wade Pfau: Does The 4% Rule Work In Today’s Markets?

countmein is stating that his model is showing less than 2% SWR... Somehow, 50 years of expenses may not last 30 years. It's possible, but something is seriously broken in that world. Nothing will be safe at that point. A random Monte-Carlo system (those are notoriously bad at overstating sequence ...
by konic
Thu Sep 19, 2019 8:06 pm
Forum: Personal Finance (Not Investing)
Topic: Kitces: The Problem with FIREing at 4% and the Need for Flexible Spending Rules
Replies: 274
Views: 22943

Re: Kitces: The Problem with FIREing at 4% and the Need for Flexible Spending Rules

PWR leaves you with atleast as much portfolio as you started with in real terms, regardless of the time period. Yes to the first part, no to the second part. The PWR changes depending on time period. :oops: Did you actually pay attention to the PWR graph in the link I provided upthread? What did yo...
by konic
Thu Sep 19, 2019 7:59 pm
Forum: Investing - Theory, News & General
Topic: Wade Pfau: Does The 4% Rule Work In Today’s Markets?
Replies: 149
Views: 12689

Re: Wade Pfau: Does The 4% Rule Work In Today’s Markets?

countmein is stating that his model is showing less than 2% SWR... Somehow, 50 years of expenses may not last 30 years. It's possible, but something is seriously broken in that world. Nothing will be safe at that point. A random Monte-Carlo system (those are notoriously bad at overstating sequence ...
by konic
Tue Sep 10, 2019 9:58 pm
Forum: Personal Finance (Not Investing)
Topic: Kitces: The Problem with FIREing at 4% and the Need for Flexible Spending Rules
Replies: 274
Views: 22943

Re: Kitces: The Problem with FIREing at 4% and the Need for Flexible Spending Rules

The MC modeling makes very little sense. As an alternative look at a simple 3-fund 60:40 Portfolio with a Mean real return of 5.7 and a higher volatility of 10.7 at the below link: https://portfoliocharts.com/portfolio/three-fund-portfolio/ This has a PWR of 3.5%!!! If 2% SWR is meant as a serious ...
by konic
Tue Sep 10, 2019 9:35 pm
Forum: Personal Finance (Not Investing)
Topic: Kitces: The Problem with FIREing at 4% and the Need for Flexible Spending Rules
Replies: 274
Views: 22943

Re: Kitces: The Problem with FIREing at 4% and the Need for Flexible Spending Rules

The MC modeling makes very little sense. As an alternative look at a simple 3-fund 60:40 Portfolio with a Mean real return of 5.7 and a higher volatility of 10.7 at the below link: https://portfoliocharts.com/portfolio/three-fund-portfolio/ This has a PWR of 3.5%!!! If 2% SWR is meant as a serious ...
by konic
Tue Sep 10, 2019 9:29 pm
Forum: Investing - Theory, News & General
Topic: Rich people are hoarding cash
Replies: 233
Views: 35024

Re: Rich people are hoarding cash

FT Report Rich people are hoarding cash, and wealth managers are getting frustrated ....Yet perception of risk is an emotional thing. If people feel comfortable paying extra money in the form of negative rates for the known loss they will suffer on cash versus the unknown and potentially larger los...
by konic
Sat Sep 07, 2019 6:21 pm
Forum: Personal Finance (Not Investing)
Topic: Kitces: The Problem with FIREing at 4% and the Need for Flexible Spending Rules
Replies: 274
Views: 22943

Re: Kitces: The Problem with FIREing at 4% and the Need for Flexible Spending Rules

Aswath Damodaran who is arguably the world's foremost authority on valuation and who does not hang around in the "my forecast is more pessimistic than your forecast" circles currently estimates the Equity Risk Premium as being 5.3%. So, if long term bonds yield .4% real, then a reasonable expectati...
by konic
Sat Sep 07, 2019 10:37 am
Forum: Personal Finance (Not Investing)
Topic: Kitces: The Problem with FIREing at 4% and the Need for Flexible Spending Rules
Replies: 274
Views: 22943

Re: Kitces: The Problem with FIREing at 4% and the Need for Flexible Spending Rules

I was using their stated 4.5% from the podcast and subtracted 2% for inflation. Could use Rick's old 30 year forecast but you've got to set the bond side to 0 real. Stocks are 5% so that's 3% real for the portfolio. The PV model at 3% real expected return gives you an SWR of 2.0 . So you really bel...
by konic
Wed Jul 31, 2019 10:41 pm
Forum: Investing - Theory, News & General
Topic: Why Mr. Bogle prefers U.S stocks
Replies: 241
Views: 20874

Re: Why Mr. Bogle prefers U.S stocks

Whatever you do regarding International, don't spend hours reading about it. If that's you, you probably need to be at the 20% level and just forget it and stick to it and rebalance every year or so. I realized this was me several years ago and chose 25% as I wanted to be right down the middle betw...
by konic
Fri Jul 26, 2019 6:23 pm
Forum: Personal Investments
Topic: What rate of return do you use when calculating long term investments?
Replies: 32
Views: 3312

Re: What rate of return do you use when calculating long term investments?

Rick Ferri wrote:
Fri Jul 26, 2019 6:18 pm
2% for cash
3% for bonds
6% for stocks

Rick Ferri
Rick,

Are this estimates nominal or real? I am assuming these are mean returns and not extreme ones.
by konic
Fri Jul 26, 2019 6:20 pm
Forum: Personal Investments
Topic: Laid Off - Want to Retire / Am I OK
Replies: 145
Views: 20749

Re: Laid Off - Want to Retire / Am I OK

All these replies are very helpful. My primary concern is sequence of risk, that is why I want to try and live on mostly dividends / income in the initial years. My current estimate of dividend and interest income is about 130K. The individual stocks I have pay above average dividends. So the rest ...
by konic
Fri Jul 26, 2019 6:17 pm
Forum: Personal Investments
Topic: What rate of return do you use when calculating long term investments?
Replies: 32
Views: 3312

Re: What rate of return do you use when calculating long term investments?

Tdubs wrote:
Fri Jul 26, 2019 4:01 pm

For me, it is the pessimistic scenarios that are useful--zero nominal. It tells me the minimum I need to save.
In this context, isn’t this the maximum you need to save?
by konic
Fri Jul 26, 2019 6:09 pm
Forum: Personal Investments
Topic: What rate of return do you use when calculating long term investments?
Replies: 32
Views: 3312

Re: What rate of return do you use when calculating long term investments?

I think it is much more important to focus on "how much uncertainty, what's a good range to use in planning? For example, if we look at the annualized (CAGR) real return (inflation-adjusted) of the S&P 500 over thirty-year periods from 1926 through 2017, it has been as low as 4.35% (1965-1994) and ...
by konic
Fri May 17, 2019 4:41 pm
Forum: Investing - Theory, News & General
Topic: Investment return assumptions for periodic contribution plans
Replies: 5
Views: 335

Re: Investment return assumptions for periodic contribution plans

Central to my point was the observation that the ‘money weighted rate of return’, for a balanced global portfolio, due to continual contributions seems to be smoother and within a narrower range than the statistical distribution of possible returns for different asset classes. This observation makes...
by konic
Fri May 17, 2019 10:14 am
Forum: Investing - Theory, News & General
Topic: Investment return assumptions for periodic contribution plans
Replies: 5
Views: 335

Investment return assumptions for periodic contribution plans

Longtime lurker posting first time. I thank everyone here that share their knowledge and wisdom regarding investing, personal finance and all other topics.Today, I am setting this post up to discuss the assumptions various people make regarding the expectation of returns on investing in the market. ...