Search found 2535 matches

by longinvest
Fri Feb 23, 2018 11:51 am
Forum: Investing - Theory, News & General
Topic: Terminology question: what does "losing money" mean?
Replies: 71
Views: 2461

Re: Terminology question: what does "losing money" mean?

Money by definition is nominal. That is one reason I can't see why there is a discussion. While money is nominal, financial planning is often done using constant-dollars (which are hypothetical dollars which automatically adjust to CPI inflation). The same goes for returns; mutual funds report thei...
by longinvest
Fri Feb 23, 2018 11:40 am
Forum: Investing - Theory, News & General
Topic: Terminology question: what does "losing money" mean?
Replies: 71
Views: 2461

Re: Terminology question: what does "losing money" mean?

Money by definition is nominal. That is one reason I can't see why there is a discussion. While money is nominal, financial planning is often done using constant-dollars (which are hypothetical dollars which automatically adjust to CPI inflation). The same goes for returns; mutual funds report thei...
by longinvest
Fri Feb 23, 2018 9:24 am
Forum: Investing - Theory, News & General
Topic: Simba's backtesting spreadsheet [a Bogleheads community project]
Replies: 1094
Views: 597537

Re: Simba's backtesting spreadsheet [a Bogleheads community project]

I was wondering how many people download this spreadsheet. Sometimes, I have doubts, due to the fairly limited amount of feedback about it (e.g. just a few posters). So I set up a counter associated with the short URL which allows people to download it. In the past 2 weeks, v17b has been downloaded...
by longinvest
Fri Feb 23, 2018 9:17 am
Forum: Investing - Theory, News & General
Topic: The Three-Fund Portfolio
Replies: 2075
Views: 1261274

Re: The Three-Fund Portfolio

I'm quite newbie here Still confused how total return strategy with 3 fund when stock market crashes say 40% from previous high, do we still withdraw at initially decided rate (say 3% withdrawal rate), or not drawing until the market bounce back This is probably beyond the scope of this Three-Fund ...
by longinvest
Fri Feb 23, 2018 8:58 am
Forum: Investing - Theory, News & General
Topic: "Bogleheads.org" by Kristine Hayes"
Replies: 35
Views: 3854

Re: "Bogleheads.org" by Kristine Hayes"

UpperNwGuy wrote:
Fri Feb 23, 2018 8:34 am
tooluser wrote:
Fri Feb 23, 2018 12:04 am
RTFM is too-often overused now.
What does RTFM mean?
It's apparently missing from our wiki's Abbreviations and Acronyms page.

It means: Read The F[ine] Manual.

EDIT: It's not missing anymore, but it says not to use it. :)
by longinvest
Fri Feb 23, 2018 7:44 am
Forum: Investing - Theory, News & General
Topic: Terminology question: what does "losing money" mean?
Replies: 71
Views: 2461

Re: Terminology question: what does "losing money" mean?

This discussion raises an interesting point about how one should measure one's portfolio return and progress. I use Longinvest's excel spreadsheet and entered the data going back to early 2015, but I have to be honest, I have not adjusted for inflation when looking at the returns. Is anyone deducti...
by longinvest
Thu Feb 22, 2018 11:19 am
Forum: Investing - Theory, News & General
Topic: Variable Percentage Withdrawal (VPW)
Replies: 741
Views: 233935

Re: Variable Percentage Withdrawal (VPW)

On another thread, I've written a post illustrating how to analyze a retirement scenario involving a couple. This is a complex analysis because it involves many scenarios. For instance, we must consider that a spouse could die or the couple could divorce. (click on the ↑ symbol after "longinvest wro...
by longinvest
Thu Feb 22, 2018 10:51 am
Forum: Investing - Help with Personal Investments
Topic: retirement calculator - most that I've seen are missing some things
Replies: 18
Views: 2225

Re: retirement calculator - most that I've seen are missing some things

(... continuing) All of these amounts are pre-tax. This 1972 hypothetical retirement wouldn't have been able to sustain $10,000 in total monthly tax and expenses in the worst year ($93K). But, having a little flexibility to cut expenses in bad years would probably have been sufficient. It's importan...
by longinvest
Thu Feb 22, 2018 10:50 am
Forum: Investing - Help with Personal Investments
Topic: retirement calculator - most that I've seen are missing some things
Replies: 18
Views: 2225

Re: retirement calculator - most that I've seen are missing some things

(... continuing) Here's a screenshot of the VPW backtesting spreadsheet for a hypothetical past retirement on January 1st, 1972: The settings: https://s17.postimg.org/guzagc0kv/settings.png Here's the evolution of total income (yellow line - inflation-adjusted), as well as the evolution of withdrawa...
by longinvest
Thu Feb 22, 2018 9:48 am
Forum: Investing - Help with Personal Investments
Topic: retirement calculator - most that I've seen are missing some things
Replies: 18
Views: 2225

Re: retirement calculator - most that I've seen are missing some things

Daacrusher2001, Example 1[hypothetical]: Let's say I'm 59, I have $2M in savings, I want to retire now. I plan to start a pension at age 62, my spouse has a pension that starts 3 years later, SS starts at age 62 for me, age 65 for her...I need income of $120K per year or $10K per month. So, in years...
by longinvest
Wed Feb 21, 2018 7:15 pm
Forum: Investing - Theory, News & General
Topic: Retirees: The common sense withdrawal method
Replies: 142
Views: 12199

Re: Retirees: The common sense withdrawal method

TN_Boy, I should try and do at least one baseline comparison with the backtesting spreadsheets, for example a 60/40 stock/bond using the 4% rule versus setting aside some of the money and using VPW (obviously it starts getting pretty complex comparing a wide variety of combinations). I think that it...
by longinvest
Wed Feb 21, 2018 5:16 pm
Forum: Investing - Theory, News & General
Topic: Credit Suisse Global Investment Returns Yearbook 2018 (Summary Edition)
Replies: 10
Views: 798

Re: Credit Suisse Global Investment Returns Yearbook 2018 (Summary Edition)

nisiprius wrote:
Wed Feb 21, 2018 5:13 pm
Is the full edition no longer available without cost?
Since 2017, I think that only the summary edition can be downloaded for free. In my personal archives, the last full edition (free PDF) that I've downloaded is the 2016 edition. (The oldest free PDF I have is the full 2009 edition).
by longinvest
Wed Feb 21, 2018 5:09 pm
Forum: Investing - Theory, News & General
Topic: Credit Suisse Global Investment Returns Yearbook 2018 (Summary Edition)
Replies: 10
Views: 798

Credit Suisse Global Investment Returns Yearbook 2018 (Summary Edition)

It's out! (Thanks to Taggart on our FinancialWisdomForum Canadian sister site for the information). Summary Edition: Credit Suisse Global Investment Returns Yearbook 2018 Publisher's Site: https://www.credit-suisse.com/corporate/en/research/research-institute/publications.html Direct link: http://pu...
by longinvest
Wed Feb 21, 2018 11:07 am
Forum: Investing - Theory, News & General
Topic: Retirees: The common sense withdrawal method
Replies: 142
Views: 12199

Re: Retirees: The common sense withdrawal method

TN_Boy, The "raw" version of VPW has potentially more variation in yearly spending than I like I've showed, in previous posts, that the impact of a 50% stock drop on retirement income could be as low a 15% when combining VPW on a balanced portfolio with non-portfolio income (including any necessary ...
by longinvest
Tue Feb 20, 2018 2:16 pm
Forum: Investing - Theory, News & General
Topic: Retirees: The common sense withdrawal method
Replies: 142
Views: 12199

Re: Retirees: The common sense withdrawal method

SWR carries a high probability of an undesired outcome. When SWR "succeeds", it tends to leave a humongous unspent portfolio behind. Worse: when SWR fails, it completely fails , leaving the retiree penniless. This can be a huge source of anxiety during retirement. I'll never use such a method to wit...
by longinvest
Tue Feb 20, 2018 1:48 pm
Forum: Investing - Theory, News & General
Topic: Retirees: The common sense withdrawal method
Replies: 142
Views: 12199

Re: Retirees: The common sense withdrawal method

My approach guarantees me a $25k income basis all retirement long (the bridge between age 60 and 69, then SS starting at age 70), regardless of market girations. It's something that I can always count on. At age 80, I would increase the guaranteed income to be sufficient to live comfortably regardle...
by longinvest
Tue Feb 20, 2018 1:41 pm
Forum: Investing - Theory, News & General
Topic: Retirees: The common sense withdrawal method
Replies: 142
Views: 12199

Re: Retirees: The common sense withdrawal method

Let's stress test this, now: What I would do in this situation is build a portfolio, maybe 60/40 or 50/50 stocks/fixed income, and withdraw around 5% from age 60 to 70. If the market crashes, there is quite a lot of money in bonds/CDs to cushion that impact. And probably some "common sense" applied ...
by longinvest
Tue Feb 20, 2018 1:34 pm
Forum: Investing - Theory, News & General
Topic: Retirees: The common sense withdrawal method
Replies: 142
Views: 12199

Re: Retirees: The common sense withdrawal method

1) Retire at 60, take SS at 70 2) Want/need $50/yr [50k includes taxes and some room to cut back, but cutting way back would be very difficult.] 3) Portfolio $1,000,000, SS at 70 is 25k Now, if I have it right, you would suggest taking $500,000 out of the portfolio and putting it in something that ...
by longinvest
Mon Feb 19, 2018 8:11 pm
Forum: Investing - Theory, News & General
Topic: Retirees: The common sense withdrawal method
Replies: 142
Views: 12199

Re: Retirees: The common sense withdrawal method

TN_Boy, The notion of putting aside seven, or in my question, ten years of expenses in instruments guaranteed to NOT beat inflation is a good way to ensure that you wind up with less total money (for you or your heirs) when all is said and done. I don't understand the problem, here. Someone worried...
by longinvest
Mon Feb 19, 2018 2:57 pm
Forum: Investing - Theory, News & General
Topic: Retirees: The common sense withdrawal method
Replies: 142
Views: 12199

Re: Retirees: The common sense withdrawal method

TN_Boy, The notion of putting aside seven, or in my question, ten years of expenses in instruments guaranteed to NOT beat inflation is a good way to ensure that you wind up with less total money (for you or your heirs) when all is said and done. I don't understand the problem, here. Someone worried ...
by longinvest
Mon Feb 19, 2018 12:04 pm
Forum: Investing - Theory, News & General
Topic: Retirees: The common sense withdrawal method
Replies: 142
Views: 12199

Re: Retirees: The common sense withdrawal method

Bob, Example. If I was 60, I had a $1,500,000 50/50 stocks/bonds portfolio, and I expected to get $35,000 annually by delaying Social Security to age 70, I would do the following: Very few people who expect to get $35,000 from Social Security by delaying benefits to age 70 have portfolios of $1,500,...
by longinvest
Mon Feb 19, 2018 11:05 am
Forum: Investing - Theory, News & General
Topic: Retirees: The common sense withdrawal method
Replies: 142
Views: 12199

Re: Retirees: The common sense withdrawal method

Let's put this to a test. Let's assume that the stock market drops 50% during the first retirement year, at age 60. What's the impact on total pre-tax retirement income at age 61? In other words, at age 60, I would put $350,000 in a savings account and immediately take out $35,000 for spending durin...
by longinvest
Mon Feb 19, 2018 9:39 am
Forum: Investing - Theory, News & General
Topic: Retirees: The common sense withdrawal method
Replies: 142
Views: 12199

Re: Retirees: The common sense withdrawal method

To me, simplicity and flexibility are key. I don't consider flying by the seat of my pants as reasonable. It would make me anxious. I don't want financial anxiety during retirement. That's why my retirement plan is to combine stable lifelong non-portfolio income with flexible portfolio withdrawals ...
by longinvest
Mon Feb 19, 2018 7:33 am
Forum: Investing - Theory, News & General
Topic: How many of you use the "4% rule" during retirement?
Replies: 68
Views: 8210

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

I would never use the 4% SWR during retirement! Let me explain: The first principle of our Philosophy is to Develop a workable plan . One of the best features of a workable plan is that it helps us relax. Threads about SWR seem to exhibit a lot of anxiety. I think that this is because SWR does not q...
by longinvest
Sun Feb 18, 2018 12:26 pm
Forum: Investing - Theory, News & General
Topic: Retirees: The common sense withdrawal method
Replies: 142
Views: 12199

Re: Retirees: The common sense withdrawal method

To me, simplicity and flexibility are key. I don't consider flying by the seat of my pants as reasonable. It would make me anxious. I don't want financial anxiety during retirement. That's why my retirement plan is to combine stable lifelong non-portfolio income with flexible portfolio withdrawals g...
by longinvest
Mon Feb 12, 2018 11:53 am
Forum: Investing - Theory, News & General
Topic: The Mathematics of Retirement Investing
Replies: 127
Views: 18171

Re: The Mathematics of Retirement Investing

JCE66,
#Cruncher wrote:
JCE66 wrote:
Sat Feb 10, 2018 11:58 am
longinvest, #Cruncher....Quick question. Will the spreadsheets be updated for the new tax rates?
I don't stay informed about US tax rates changes. Maybe #Cruncher does and would be willing to provide a new version of his nice little spreadsheet.
by longinvest
Fri Feb 09, 2018 11:23 am
Forum: Investing - Theory, News & General
Topic: A Returns Spreadsheet for Bogleheads
Replies: 220
Views: 45061

Re: A Returns Spreadsheet for Bogleheads

Thanks for the spreadsheet. I am trying to experiment with it but I get the following error when trying to test it. I have entered a portfolio and there are no other errors in the file. Worksheet where error appears = Returns Cell = C12 = (Error message in cell) #NUM! Cell = C12 = (contents of cell...
by longinvest
Mon Feb 05, 2018 9:47 pm
Forum: Investing - Theory, News & General
Topic: Historical Bond Returns - Shiller: From Rates to Returns
Replies: 238
Views: 28054

Re: Historical Bond Returns - Shiller: From Rates to Returns

I have uploaded version 1.16 of the spreadsheet.

It is available online and to download from the links in the first post.

Main changes:
  • Added FRED January 2018 data.
As usual, comments are welcome.

Enjoy!
by longinvest
Sun Jan 21, 2018 7:13 pm
Forum: Investing - Theory, News & General
Topic: Historical Bond Returns - Shiller: From Rates to Returns
Replies: 238
Views: 28054

Re: Historical Bond Returns - Shiller: From Rates to Returns

Dan, I am trying to estimate the "daily" historical returns of an intermediate term treasury fund [...] FRED has daily rates for multiple CMTs back to 1962 (1yr, 5yr, 10yr), which is the time frame I would like to estimate daily returns back to. I would appreciate any advice on the best approach to ...
by longinvest
Tue Jan 02, 2018 9:28 am
Forum: Investing - Help with Personal Investments
Topic: SWR, different perspective.
Replies: 38
Views: 3137

Re: SWR, different perspective.

Dbr, Well, withdrawal does not apply in the accumulation state, does it? The calculations are useful for getting estimates for how much to accumulate. <Off topic> Actually, the principles of it can actually be useful in the accumulation phase. Here's a thread about it, on our Canadian sister forum: ...
by longinvest
Tue Jan 02, 2018 9:15 am
Forum: Investing - Help with Personal Investments
Topic: SWR, different perspective.
Replies: 38
Views: 3137

Re: SWR, different perspective.

That is certainly a great defense of the VPW longinvest, however I don't see any of it addressing the original questions perspective. Which was how to reconcile a withdrawal scheme with the actual need for money to spend which follows a different dynamic entirely. I don't know... How do I do it, to...
by longinvest
Mon Jan 01, 2018 7:19 pm
Forum: Investing - Help with Personal Investments
Topic: SWR, different perspective.
Replies: 38
Views: 3137

Re: SWR, different perspective.

Hi Midareff, Happy new 2018 year! We have VPW, an excellent tool but with an actuarial based... What do you mean by VPW being actuarial based? It's not. VPW is a portfolio depleting method which targets, by default, its last withdrawal at age 99. The last withdrawal age can be increased to a higher...
by longinvest
Mon Jan 01, 2018 11:13 am
Forum: Investing - Help with Personal Investments
Topic: SWR, different perspective.
Replies: 38
Views: 3137

Re: SWR, different perspective.

Tibbitts, I was addressing the "today's retiree, at least the retiree we might find on this .org" part. I think the number of people here or elsewhere with cola'd pensions is already small and is shrinking. It won't go to zero for a while (military, etc.) but probably will eventually. For practical ...
by longinvest
Mon Jan 01, 2018 11:03 am
Forum: Investing - Theory, News & General
Topic: Is Beta a distinct factor or a summation of other factors
Replies: 42
Views: 2012

Re: Is Beta a distinct factor or a summation of other factors

Packer, I think that you're onto something, here. So how is factor investing any different from any other active strategy with non-professionals competing against the pros? Based on the mathematical definition of active and passive , before "passive" was redefined by active firms to mean something e...
by longinvest
Mon Jan 01, 2018 9:51 am
Forum: Investing - Help with Personal Investments
Topic: SWR, different perspective.
Replies: 38
Views: 3137

Re: SWR, different perspective.

Hi Midareff, Happy new 2018 year! We have VPW, an excellent tool but with an actuarial based... What do you mean by VPW being actuarial based? It's not. VPW is a portfolio depleting method which targets, by default, its last withdrawal at age 99. The last withdrawal age can be increased to a higher ...
by longinvest
Thu Dec 28, 2017 1:33 pm
Forum: Investing - Theory, News & General
Topic: What ever happened to the Larry portfolio?
Replies: 120
Views: 11948

Re: What ever happened to the Larry portfolio?

Dear QuietProsperity, I still think that 100% US Stocks is an awful benchmark to compare the Larry Portfolio against, even if he (maybe) suggested it in the NYT article. I just found that Larry Swedroe actually expressed his opinion about the New York Times article on our forums! First, here's the i...
by longinvest
Thu Dec 28, 2017 11:34 am
Forum: Investing - Theory, News & General
Topic: What ever happened to the Larry portfolio?
Replies: 120
Views: 11948

Re: What ever happened to the Larry portfolio?

CULater, On December 23, 2011, Ron Lieber made the Larry Portfolio known to the wide public with his " Taking a Chance on the Larry Portfolio " article in The New York Times. Here's an illustration that the article gave of one version of this portfolio along with a benchmark: For illustration purpos...
by longinvest
Wed Dec 27, 2017 11:09 am
Forum: Investing - Theory, News & General
Topic: What ever happened to the Larry portfolio?
Replies: 120
Views: 11948

Re: What ever happened to the Larry portfolio?

Triceratop, ...all you would have needed to do was put 32 percent of your money in a fund mimicking the United States stock index of small and value companies that Mr. Fama and Mr. French developed... Larry Portfolio (red): Vanguard Small Cap Value Index (VISVX) - 32% / Vanguard Short-Term Treasury ...
by longinvest
Wed Dec 27, 2017 10:52 am
Forum: Investing - Theory, News & General
Topic: What ever happened to the Larry portfolio?
Replies: 120
Views: 11948

Re: What ever happened to the Larry portfolio?

CULater,
CULater wrote:
Wed Dec 27, 2017 10:16 am
Don't think Larry ever specifically recommended 1-year.
What about the citation from The New York Times I provided in the post just above yours?
by longinvest
Wed Dec 27, 2017 10:12 am
Forum: Investing - Theory, News & General
Topic: What ever happened to the Larry portfolio?
Replies: 120
Views: 11948

Re: What ever happened to the Larry portfolio?

On December 23, 2011, Ron Lieber made the Larry Portfolio known to the wide public with his " Taking a Chance on the Larry Portfolio " article in The New York Times. Here's an illustration that the article gave of one version of this portfolio along with a benchmark: For illustration purposes, [Larr...
by longinvest
Tue Dec 26, 2017 11:34 am
Forum: Investing - Theory, News & General
Topic: Inflation can cream bonds VBTLX vs VSCSX
Replies: 42
Views: 3592

Re: Inflation can cream bonds VBTLX vs VSCSX

I would appreciate to see my posts properly quoted as to not misrepresent what I wrote. It's common etiquette to omit images in quotes to shorten posts. I didn't misrepresent anything. You posted a chart showing nominal returns. Your discussion was all about nominal returns. In this particular case...
by longinvest
Tue Dec 26, 2017 11:29 am
Forum: Investing - Theory, News & General
Topic: Inflation can cream bonds VBTLX vs VSCSX
Replies: 42
Views: 3592

Re: Inflation can cream bonds VBTLX vs VSCSX

Saltycaper, Examining a nominal return chart (which, incidentally, are usually the types of charts I see), is not really helpful in understanding the risks inflation poses to bonds, which is the subject of the thread. That the investors opening their statements may be comforted by their natural tend...
by longinvest
Tue Dec 26, 2017 11:15 am
Forum: Investing - Theory, News & General
Topic: Inflation can cream bonds VBTLX vs VSCSX
Replies: 42
Views: 3592

Re: Inflation can cream bonds VBTLX vs VSCSX

Let's put things into perspective. Let's look at bonds vs stocks in the 1970s: Just for reference, here's a total-return chart I made, on another thread, to show the comparative growth of an intermediate -duration ladder-like bond fund and the S&P 500 in the worst high-inflation part of the 1970s to...
by longinvest
Fri Dec 22, 2017 8:28 pm
Forum: Investing - Theory, News & General
Topic: Saving for the crash
Replies: 58
Views: 7514

Re: Saving for the crash

or is it absolutely anti-Bogle? This should answer your question. Bogleheads® investment philosophy: Never try to time the market There is a large amount of research showing that typical mutual fund investors actually perform far worse than the mutual funds they invest in because they tend to buy a...
by longinvest
Wed Dec 20, 2017 5:32 pm
Forum: Investing - Theory, News & General
Topic: Geometric Average vs. Arithmetic Average
Replies: 92
Views: 5051

Re: Geometric Average vs. Arithmetic Average

Maybe I spoke too soon. What is the difference between IRR and CAGR? IRR is a compound average growth rate that takes into account that there may be money added to or withdrawn from the investment at different points in time. Technically CAGR assumes an amount initially invested with nothing added ...
by longinvest
Wed Dec 20, 2017 9:10 am
Forum: Investing - Help with Personal Investments
Topic: TIPS and / or Total Bond Fund in AA?
Replies: 26
Views: 1761

Re: TIPS and / or Total Bond Fund in AA?

BigJohn, If you don't mind, I'd appreciate your perspective on the following. For reasons I won't go into, I really don't want to construct and manage a non-rolling ladder of individual bonds. I also agree with your comments about the irreversible nature of SPIAs and have concluded that now is not t...
by longinvest
Tue Dec 19, 2017 12:13 pm
Forum: Investing - Help with Personal Investments
Topic: TIPS and / or Total Bond Fund in AA?
Replies: 26
Views: 1761

Re: TIPS and / or Total Bond Fund in AA?

Dbr and BigJohn, dbr, I'm not trying to be difficult and I understand the use of a TIPS ladder in an LMP. I also understand that if held to maturity, the the long bond interest rate risk is neutralized. What I'm trying to understand is this comment A TIPS fund does insure against inflation but not a...
by longinvest
Sun Dec 17, 2017 12:35 pm
Forum: Investing - Theory, News & General
Topic: VPW Spreadsheet Question
Replies: 1
Views: 300

Re: VPW Spreadsheet Question

Sixtyforty, I've been playing around with the VPW spreadsheet and have a question. Under the "Backtesting" tab. I entered 48 as the retirement age and set SS to 10K, Start Year 2000. Under the backtesting table, the total income is $10K higher than the withdrawal in year 2000 (age 48). It looks like...
by longinvest
Sat Dec 16, 2017 2:45 pm
Forum: Investing - Help with Personal Investments
Topic: Question About TIPs and TIP Funds
Replies: 43
Views: 1899

Re: Question About TIPs and TIP Funds

Thesaints wrote:
Sat Dec 16, 2017 2:44 pm
Whoever finds the philosopher's stone will be a billionaire.
Good luck. :moneybag :moneybag :moneybag
by longinvest
Sat Dec 16, 2017 2:41 pm
Forum: Investing - Help with Personal Investments
Topic: Question About TIPs and TIP Funds
Replies: 43
Views: 1899

Re: Question About TIPs and TIP Funds

By constant , I meant that the 1-year yield doesn't change over time, the 2-year yield doesn't change over time, the 3-year yield doesn't change over time, etc. By not flat I meant that the 1-year, 2-year, 3-year, are not all equal. If you know with certainty that interest rates are constant then t...