Search found 5731 matches

by randomguy
Tue Jul 17, 2018 11:21 pm
Forum: Investing - Theory, News & General
Topic: Balanced Funds and Sequence of Return Risk
Replies: 47
Views: 2596

Re: Balanced Funds and Sequence of Return Risk

randomguy, I think we are not talking about the same thing. What I meant was the stock market stayed down for 5 years with a 0% or negative real return every year. << 0% is pretty bad but it isn't end of the world case. 2000-9 was 0% real for 60/40 funds for 10 years (the exact numbers depend on yo...
by randomguy
Tue Jul 17, 2018 6:44 pm
Forum: Investing - Theory, News & General
Topic: Balanced Funds and Sequence of Return Risk
Replies: 47
Views: 2596

Re: Balanced Funds and Sequence of Return Risk

2) My planning assumes that 0% return for 5 years is the worst case. I believe that money would be least of the worry if that happened. I kept some physical gold for that scenario. 0% is pretty bad but it isn't end of the world case. 2000-9 was 0% real for 60/40 funds for 10 years (the exact number...
by randomguy
Tue Jul 17, 2018 10:51 am
Forum: Investing - Theory, News & General
Topic: Balanced Funds and Sequence of Return Risk
Replies: 47
Views: 2596

Re: Balanced Funds and Sequence of Return Risk

randomguy, <<do you spend your bucket and go to 100/0>> Under this system, you will spend your bucket and go down to 100/0. <<Imagine you have a 10 year flat market coming up. >> If that happened, in year 5 or earlier than that, the person should drastically lower his/her expense. KlangFool P.S.: T...
by randomguy
Tue Jul 17, 2018 10:25 am
Forum: Personal Consumer Issues
Topic: Have you ever purchased a pricy musical instrument?
Replies: 62
Views: 2501

Re: Have you ever purchased a pricy musical instrument?

My personal opinion, at least for guitars and other stringed instruments (ukuleles, mandolins, etc.) is that there is sort of an "80-20" rule when it comes to how much money you spend. i.e. you can get 80% of the desired quality for 20% of the max cost. Take guitars for example, say there is genera...
by randomguy
Tue Jul 17, 2018 8:50 am
Forum: Investing - Theory, News & General
Topic: Balanced Funds and Sequence of Return Risk
Replies: 47
Views: 2596

Re: Balanced Funds and Sequence of Return Risk

The portfolio is 900K and 60/40. That meant 540K of stock and 360K of the bond. The stock drops 50% and down to 270K. Under this bucket system, the minimum is 300K of the bond. So, the person sells 360K - 300K = 60K of bond to buy stock. The final AA is 270K+60K = 330K of stock and 300K of the bond...
by randomguy
Tue Jul 17, 2018 8:38 am
Forum: Investing - Theory, News & General
Topic: Why is leveraging property good but leveraging stocks bad?
Replies: 139
Views: 8836

Re: Why is leveraging property good but leveraging stocks bad?

I must admit, I think I get the "take-home message" but I'm not smart enough to understand the minutia of the concept. How does Kelly Criterion explain why 500% property isn't ruinous? Is it because principal is constantly being repaid? At a high level the Kelly Criterion is about bet sizing so tha...
by randomguy
Mon Jul 16, 2018 11:30 pm
Forum: Investing - Theory, News & General
Topic: Why is leveraging property good but leveraging stocks bad?
Replies: 139
Views: 8836

Re: Why is leveraging property good but leveraging stocks bad?

One more question I would like to resolve. I'm assuming most of us Bogleheads have some configuration of a stock/bond index fund portfolio. If one were offered a no margin call loan with rates equivalent to home mortgage rates, would one take it if still in accumulation phase? Would some say no bec...
by randomguy
Mon Jul 16, 2018 11:05 pm
Forum: Investing - Theory, News & General
Topic: Balanced Funds and Sequence of Return Risk
Replies: 47
Views: 2596

Re: Balanced Funds and Sequence of Return Risk

randomguy, <<I always like how people use pessimistic SWR and optimistic returns.;) >> Now, I am confused. Do you consider 5% to 7% nominal return as an optimistic return for a 60/40 portfolio? KlangFool Optimistic savings rate.:) Is 5-7% optimistic over 7 years? For a 2% SWR person it sure is. The...
by randomguy
Mon Jul 16, 2018 8:56 pm
Forum: Investing - Theory, News & General
Topic: Balanced Funds and Sequence of Return Risk
Replies: 47
Views: 2596

Re: Balanced Funds and Sequence of Return Risk

randomguy, <<I always like how people use pessimistic SWR and optimistic returns.;) >> Now, I am confused. Do you consider 5% to 7% nominal return as an optimistic return for a 60/40 portfolio? KlangFool Optimistic savings rate.:) Is 5-7% optimistic over 7 years? For a 2% SWR person it sure is. The...
by randomguy
Mon Jul 16, 2018 5:29 pm
Forum: Investing - Theory, News & General
Topic: Balanced Funds and Sequence of Return Risk
Replies: 47
Views: 2596

Re: Balanced Funds and Sequence of Return Risk

Or far less than a decade. 1) For folks that save 1 year of expense every year. Between the new contribution and growth, it does not take that long. It is in between 6 to 8 years. Starting Net Worth $1,500,000 Annual Savings $60,000 Years Annual Return Rate 6 7 8 5.00% $2,418,258 $2,599,171 $2,789,...
by randomguy
Mon Jul 16, 2018 3:52 pm
Forum: Personal Finance (Not Investing)
Topic: Should we sell our business?
Replies: 58
Views: 4406

Re: Should we sell our business?

Probably about half the people who have given advice about the selling price have written, "actual profit sets the selling price" or something to that effect. I don't see why small businesses should be any different from large companies (they just have different kinds of risk). People were buying A...
by randomguy
Mon Jul 16, 2018 2:34 pm
Forum: Investing - Theory, News & General
Topic: Balanced Funds and Sequence of Return Risk
Replies: 47
Views: 2596

Re: Balanced Funds and Sequence of Return Risk

I do think that bucket strategies can work well, if for no other reason than they can make more intuitive sense than a traditional AA approach. But they are certainly more complicated, and many don't seem to understand that this complexity exists. willthrill81, I believe that traditional AA can wor...
by randomguy
Mon Jul 16, 2018 2:09 pm
Forum: Personal Finance (Not Investing)
Topic: Potential Personal Judgement-Florida
Replies: 12
Views: 2024

Re: Potential Personal Judgement-Florida

Or find a trust/estate lawyer who is knowledgeable about asset protection. If this is an ongoing lawsuit, I'd expect financial transactions to get scrutinized if it results in bankruptcy. Florida allows the homestead exemption for fraudulent conversions so the OP might be able to pull it off. Figur...
by randomguy
Mon Jul 16, 2018 1:49 pm
Forum: Investing - Theory, News & General
Topic: Balanced Funds and Sequence of Return Risk
Replies: 47
Views: 2596

Re: Balanced Funds and Sequence of Return Risk

I do think that bucket strategies can work well, if for no other reason than they can make more intuitive sense than a traditional AA approach. But they are certainly more complicated, and many don't seem to understand that this complexity exists. willthrill81, I believe that traditional AA can wor...
by randomguy
Mon Jul 16, 2018 1:41 pm
Forum: Investing - Theory, News & General
Topic: Balanced Funds and Sequence of Return Risk
Replies: 47
Views: 2596

Re: Balanced Funds and Sequence of Return Risk

The time to worry about sequence of return risks is in the early years of your retirement. If you haven't had bad returns during the first 5-10 years then with a "standard" 3.5/4% WR your portfolio will have grown larger. Unless you then up the withdrawal amount you have a large buffer to cover any...
by randomguy
Sun Jul 15, 2018 12:55 pm
Forum: Personal Finance (Not Investing)
Topic: Should we sell our business?
Replies: 58
Views: 4406

Re: Should we sell our business?

Paying 7x cashflow for a small business would be pretty crazy. Depends on the business. Some Saas company with locked in customers, 30% yoy growth for the past 5 years, and no owner value is a lot different than buying some gym that has been doing the same sales for the past 10 years. OP is trying ...
by randomguy
Sun Jul 15, 2018 12:39 pm
Forum: Personal Consumer Issues
Topic: When does frugal cross the line to cheapskate?
Replies: 136
Views: 9392

Re: When does frugal cross the line to cheapskate?

Before I met my husband I had a few dates with a guy I thought I was starting to like. He had a good job, he was tall, dark and handsome and had a good personality. He did not tip at ANY of the restaurants we visited and I was shocked and ended up leaving the tips myself. Against my better judgemen...
by randomguy
Sun Jul 15, 2018 10:16 am
Forum: Personal Finance (Not Investing)
Topic: Would you trade experiences in your youth for early retirement
Replies: 81
Views: 5107

Re: Would you trade experiences in your youth for early retirement

Yeah, but come on $200 for business class isn't much of a "sacrifice" nor is it going to set back my retirement much or advance it much either. By comparison, one of my buddies was happily spending 1k per month for his Escalade in 2003 for gas, insurance, and the payment. He got to experience a bit...
by randomguy
Sun Jul 15, 2018 12:10 am
Forum: Investing - Theory, News & General
Topic: Saving 20% of paycheck isn't enough
Replies: 91
Views: 10709

Re: Saving 20% of paycheck isn't enough

^ The above post makes my head hurt. I assume it is a troll post making fun of hyper-conservative boglehead assumptions and the people that just keeping adding stuff together to get crazy results. Or maybe he is a believe in 2% SWR before SS. It is hard to say:) At a high level this whole subject i...
by randomguy
Sun Jul 15, 2018 12:07 am
Forum: Investing - Theory, News & General
Topic: Why is leveraging property good but leveraging stocks bad?
Replies: 139
Views: 8836

Re: Why is leveraging property good but leveraging stocks bad?

1. Walk into a Bank of America and ask to buy a house or apartment, 20% down, 5:1 leverage. They will say "you can". Ask them to give you an 80% loan to buy actual stock in Bank of America, their own company. They may laugh you out of the bank. Makes you wonder what they think the risk of one is vs...
by randomguy
Sat Jul 14, 2018 7:13 pm
Forum: Investing - Theory, News & General
Topic: Swedroe: Investing Lessons from a Top Poker Player
Replies: 4
Views: 1155

Re: Swedroe: Investing Lessons from a Top Poker Player

The problem is that it is impossible to tell if your strategy was good or not. We just don't have the data. If a Poker player calculates he wins 86% of the time but in reality, he only wins 75% of the time, his strategy is flawed no matter what the outcome. Same thing in investing. We know in the pa...
by randomguy
Sat Jul 14, 2018 6:59 pm
Forum: Investing - Theory, News & General
Topic: Direct Real Estate Returns
Replies: 70
Views: 3745

Re: Direct Real Estate Returns

Also, if you buy cash-flowing real estate, you can mitigate risk greatly no matter what property values do - you still get paid. Only if you tenant writes you a check:) Anyone thinking about real estate should watch : https://www.netflix.com/title/80224279 or https://www.imdb.com/title/tt2223758/ ....
by randomguy
Sat Jul 14, 2018 4:58 pm
Forum: Investing - Theory, News & General
Topic: Direct Real Estate Returns
Replies: 70
Views: 3745

Re: Direct Real Estate Returns

Also, if you buy cash-flowing real estate, you can mitigate risk greatly no matter what property values do - you still get paid. Only if you tenant writes you a check:) Anyone thinking about real estate should watch : https://www.netflix.com/title/80224279 or https://www.imdb.com/title/tt2223758/ ....
by randomguy
Sat Jul 14, 2018 4:53 pm
Forum: Investing - Theory, News & General
Topic: Direct Real Estate Returns
Replies: 70
Views: 3745

Re: Direct Real Estate Returns

When we bought our present home 33 years ago, we sold our rather nice 2BR/2B condo. I've often thought that we should have held onto it. I'm pretty sure we could have about broken even as far as the rent covering the all the costs/PITI. We sold it for $140K, and today it is worth about $525K ($330k...
by randomguy
Sat Jul 14, 2018 2:50 pm
Forum: Investing - Theory, News & General
Topic: Direct Real Estate Returns
Replies: 70
Views: 3745

Re: Direct Real Estate Returns

When we bought our present home 33 years ago, we sold our rather nice 2BR/2B condo. I've often thought that we should have held onto it. I'm pretty sure we could have about broken even as far as the rent covering the all the costs/PITI. We sold it for $140K, and today it is worth about $525K ($330k...
by randomguy
Sat Jul 14, 2018 12:47 pm
Forum: Personal Finance (Not Investing)
Topic: Should we sell our business?
Replies: 58
Views: 4406

Re: Should we sell our business?

The current value according to the bean counting investment bankers is $900k. This calculation didn't include revenue from our new locations in other parts of the US....I priced in expansion and additional locations when the valuation didn't include those (yet). Unless the bean counters are working...
by randomguy
Sat Jul 14, 2018 12:29 pm
Forum: Investing - Help with Personal Investments
Topic: massive Roth conversion
Replies: 39
Views: 3086

Re: massive Roth conversion

Wondering if there is any magic bullet anyone knows about regarding converting a $1M+ Tira to Roth's and not get gutted by the IRS? Well, there is a magic bullet of sorts, but either you have it or you don't... If you happen to have a sizable taxable account in addition to your tIRA, then you can e...
by randomguy
Sat Jul 14, 2018 12:18 pm
Forum: Investing - Help with Personal Investments
Topic: massive Roth conversion
Replies: 39
Views: 3086

Re: massive Roth conversion

From my perspective the older you are the less valuable Roth conversions become because you have fewer years to take advantage of the tax-free gains (assuming the conversion is not for estate purposes to potentially pass the Roth proceeds to someone in a higher tax bracket). Another "Less bang for ...
by randomguy
Sat Jul 14, 2018 11:17 am
Forum: Personal Finance (Not Investing)
Topic: Early retirement
Replies: 122
Views: 10554

Re: Early retirement

I believe that part of the issue is because many people, including a lot of Bogleheads, view healthcare as a qualitatively different expense than all others. No one ever asks "You're planning on retiring early? What will you do about groceries, your utility bill, and clothing?" While healthcare exp...
by randomguy
Sat Jul 14, 2018 11:00 am
Forum: Personal Finance (Not Investing)
Topic: Would you trade experiences in your youth for early retirement
Replies: 81
Views: 5107

Re: Would you trade experiences in your youth for early retirement

I think this is a false dilemma. It's not either you sacrifice and retire early or you have fun experiences and retire later. Depending on your creativity, you can do both, especially if you have your own business and the time to do it. Savings does not require giving up experiences generally, most...
by randomguy
Sat Jul 14, 2018 10:45 am
Forum: Investing - Theory, News & General
Topic: Direct Real Estate Returns
Replies: 70
Views: 3745

Re: Direct Real Estate Returns

You have to assume you capitalize and reinvest 100% of those returns. Which I don't. I have a day job and invest on a side. I like my regular job, and I value my free time (a lot) more than making money, sorry. I'm at the stage in my early 30s where cash flow from real estate more than covers my li...
by randomguy
Sat Jul 14, 2018 10:22 am
Forum: Investing - Theory, News & General
Topic: Why is leveraging property good but leveraging stocks bad?
Replies: 139
Views: 8836

Re: Why is leveraging property good but leveraging stocks bad?

Simplest answer (though not necessarily correct) is that leverage is not good for property, it's just (generally) a necessity to afford one. People who can pay in cash usually do. Nah people that don't want more money pay cash. That is a different subset than the ones that can pay cash. There is a ...
by randomguy
Fri Jul 13, 2018 6:21 pm
Forum: Personal Finance (Not Investing)
Topic: Question for pre-ACA Early Retirees and pre-ACA solo folks
Replies: 33
Views: 1849

Re: Question for pre-ACA Early Retirees

People with pre-existing health conditions were definately locked into jobs pre ACA but young healthy people responsible enough to purchase individual plans were paying prices multiple times lower than they are now paying under the ACA due to legislated pricing constraints. It was very hard to comp...
by randomguy
Fri Jul 13, 2018 4:03 pm
Forum: Personal Consumer Issues
Topic: When does frugal cross the line to cheapskate?
Replies: 136
Views: 9392

Re: When does frugal cross the line to cheapskate?

I heard this somewhere recently: "If you go to a restaurant and don't leave a tip, that's cheap. If you skip the restaurant and make a meal at home, that's frugal." Edit: So what is the community's take on famous early-retirement bloggers, like Mr Money Mustache? Frugal or cheap? Mr. Money Mustache...
by randomguy
Fri Jul 13, 2018 1:42 pm
Forum: Investing - Theory, News & General
Topic: Direct Real Estate Returns
Replies: 70
Views: 3745

Re: Direct Real Estate Returns

20% + 8% + 4% + 3.75% + 3% = 38.75% annualized return on your $20K down payment. The kicker here is that rental real estate returns very typically grow every year because if your expenses increase at the same level as rents, the way the math works, the difference becomes greater every year (kind of...
by randomguy
Thu Jul 12, 2018 8:50 pm
Forum: Personal Consumer Issues
Topic: When does frugal cross the line to cheapskate?
Replies: 136
Views: 9392

Re: When does frugal cross the line to cheapskate?

If your frugality is making someone unhappy, you've crossed the line. That someone could be somebody else ("stingy,") or it could be you ("miserly.") I disagree with that. The fact that I don't buy my mom a porsche that I can afford might make her unhappy, but it doesn't make me a cheapstake or a m...
by randomguy
Thu Jul 12, 2018 3:29 pm
Forum: Personal Finance (Not Investing)
Topic: Health Insurance for Couple Early Retirement
Replies: 29
Views: 2310

Re: Health Insurance for Couple Early Retirement

I don't know about the ACA plans in CT, but in many states there aren't any plans that let you see all the best doctors in any field. I doubt there are very many medical plans anywhere that yet you see the "best" doctors in any field. Seriously is there any plan that has Mayo, Cleveland, John Hopki...
by randomguy
Thu Jul 12, 2018 8:32 am
Forum: Personal Consumer Issues
Topic: Is expensive olive oil worth it?
Replies: 59
Views: 5349

Re: Is expensive olive oil worth it?

This is the same for every other cheap good out there. You need to sample the higher quality stuff and decide if the difference matters to you. Personal experience. I notice pretty much no difference if I am cooking with the oil. If I am drizzling it on something then yeah you can notice flavor diff...
by randomguy
Thu Jul 12, 2018 8:19 am
Forum: Personal Consumer Issues
Topic: Auto Tariffs: time to buy?
Replies: 63
Views: 3602

Re: Auto Tariffs: time to buy?

The Honda Odyssey is manufactured in Lincoln, Alabama. The Toyota Sienna is manufactured in Princeton, Indiana. I was unaware that we're imposing tariffs on Alabama and Indiana. But I guess I would not be surprised to hear that we are. I guess I'm lucky as I just bought a Subaru....also built in In...
by randomguy
Thu Jul 12, 2018 8:01 am
Forum: Investing - Theory, News & General
Topic: Bucket Portfolio article by Christine Benz
Replies: 85
Views: 6279

Re: Bucket Portfolio article by Christine Benz

It seems to me that a well constructed bucket plan is more resilient than is given credit. For it to not work, you need four or five years of a plunging market where you wipe out your first bucket and are eating into what's left of the second. That isn't the same as the 10-year bear markets we had ...
by randomguy
Thu Jul 12, 2018 7:47 am
Forum: Investing - Theory, News & General
Topic: Bucket Portfolio article by Christine Benz
Replies: 85
Views: 6279

Re: Bucket Portfolio article by Christine Benz

Im not against the bucket strategy but it just seems like its just mental accounting which may ease the minds of people who are risk averse. It _is_ just mental accounting. Sell whatever and from wherever it makes most sense and if it happens to be a beatdown risky asset you sold, go buy some of th...
by randomguy
Tue Jul 10, 2018 1:11 pm
Forum: Personal Consumer Issues
Topic: Which advanced tech is necessary in cars?
Replies: 86
Views: 4278

Re: Which advanced tech is necessary in cars?

Necessary? I'd say none of that. Those are all "wants". My top safety picks: Seat belts. air bags. /thread I would add Anti Lock Brakes although I am not sure any of the above count as "advanced". Blah just drive safely and you don't need seat belts. After all attentive drivers never get into accid...
by randomguy
Tue Jul 10, 2018 1:00 pm
Forum: Personal Consumer Issues
Topic: Pull-ups and Push-ups
Replies: 414
Views: 96165

Re: Pull-ups and Push-ups

For pullups and pushups, I'm going to failure and cheating my technique to do the needed reps. I couldn't reach the max reps for pullups, even after cheating and doing negatives. Pullups went from 10 (all negatives) to 8 to 5. I'm reluctant to reduce my target reps because I want to do my maximum e...
by randomguy
Tue Jul 10, 2018 12:53 pm
Forum: Investing - Theory, News & General
Topic: Dow 40000 prediction for 2025
Replies: 44
Views: 3855

Re: Dow 40000 prediction for 2025

Houston we have a problem. -- We have one thread telling us to get ready for a LOST decade. -- We have this thread telling us to get ready for Dow 40k in seven years. Which one is correct? Gracias por leer ~cfs~ Awesome observation cfs. You nailed it! :sharebeer There is nothing contradictory in th...
by randomguy
Tue Jul 10, 2018 11:37 am
Forum: Personal Consumer Issues
Topic: Auto Tariffs: time to buy?
Replies: 63
Views: 3602

Re: Auto Tariffs: time to buy?

OP, are you sure a Harley won't work for you? (I have seen a family of seven on a motorcycle, though admittedly not in this country) I second what the poster right above me just said: from what I have heard, the steel/aluminum tariffs might be something to watch. Harleys are assembled in the US fro...
by randomguy
Tue Jul 10, 2018 11:27 am
Forum: Personal Consumer Issues
Topic: Auto Tariffs: time to buy?
Replies: 63
Views: 3602

Re: Auto Tariffs: time to buy?

Have you considered waiting to buy one of the newer models that burns coal? I see what you did there. I've not spent the time to fully educate myself on this, but I did hear something about foreign car prices could increase 25%!? I'm not sure if the source was exaggerating or if that is accurate, b...
by randomguy
Mon Jul 09, 2018 11:14 pm
Forum: Investing - Help with Personal Investments
Topic: Allocation %’s across pre-tax, roth, and taxable
Replies: 4
Views: 363

Re: Allocation %’s across pre-tax, roth, and taxable

Realistically the focus fund location is the only one that matters. SC, AllWorld, and total market tend to have pretty small distributions compared to what an active fund churns out. To some extent the question is will she ever rebalance? If not then shoving one fund per account works well. If you a...
by randomguy
Mon Jul 09, 2018 5:31 pm
Forum: Investing - Theory, News & General
Topic: Spending Patterns in Retirement: Retirees are Slow to Exhaust their Assets
Replies: 16
Views: 3497

Re: Spending Patterns in Retirement: Retirees are Slow to Exhaust their Assets

Doing something like an annuity or liability matching portfolio will result in your spending a higher percentage of your assets. But you might not actually spend any more money. You just have a lower account balance which is one of the reasons few people buy annuities and the like despite researche...
by randomguy
Sun Jul 08, 2018 9:37 pm
Forum: Investing - Theory, News & General
Topic: Is it contradictory to be a Boglehead and have substantial allocation towards SCV?
Replies: 30
Views: 2224

Re: Is it contradictory to be a Boglehead and have substantial allocation towards SCV?

First, the assertion that SCV has under-performed the S&P500 over long time periods is flat-out wrong. There is a small cap premium and a value premium, and these are persistent and pervasive (over long time periods). Look at the data yourself. Not that I'm against SCV, but there are some examples ...
by randomguy
Sun Jul 08, 2018 9:10 pm
Forum: Investing - Theory, News & General
Topic: Spending Patterns in Retirement: Retirees are Slow to Exhaust their Assets
Replies: 16
Views: 3497

Re: Spending Patterns in Retirement: Retirees are Slow to Exhaust their Assets

https://www.ebri.org/pdf/FF.300.AssetPreservation.3Apr18.pdf https://www.blackrock.com/investing/retirement/blackrock-retirement-institute/savings-and-investing/spending-in-retirement TLDR: The researchers found that after 18 years of retirement, the wealthiest group, those with $500,000 or more of...