Search found 2842 matches

by knpstr
Sat Sep 12, 2020 11:01 am
Forum: Personal Finance (Not Investing)
Topic: Projected inflation rate and equity rate of return
Replies: 27
Views: 1330

Re: Projected inflation rate and equity rate of return

2010-2019 was supposed to be the "lost decade" of low returns. People were saying we were in for 4% returns on equities. Fast forward for the 10 years Jan. 2010 through Dec. 2019 well we had 13.43% nominal returns, 11.47% inflation adjusted (according to portfolio visualizer on VTI). 2010 to 2019 h...
by knpstr
Fri Sep 11, 2020 8:57 am
Forum: Investing - Theory, News & General
Topic: Index Funds - Dangerous?
Replies: 46
Views: 3578

Re: Index Funds - Dangerous?

Hi guys, I ran across this video of a YouTuber talking about the dangers of index funds: https://youtu.be/W8ZfdKYpKbM He also mentioned that out of the top 5 companies in the sp 500 in 2009, only Microsoft right now is still there, the rest have declined. I thought that was a bit scary 😮 What are y...
by knpstr
Fri Sep 11, 2020 8:03 am
Forum: Personal Consumer Issues
Topic: Cardio alternatives to treadmills?
Replies: 107
Views: 6927

Re: Cardio alternatives to treadmills?

So think of how our ancestors did it - barefoot - over longer distances. The path I walk is slightly undulating, but I just have an easier time staying in posture; but to think of it, I'm outside in a park with natural areas and trees as opposed to a treadmill inside staring at a wall or looking do...
by knpstr
Fri Sep 11, 2020 8:01 am
Forum: Personal Finance (Not Investing)
Topic: Projected inflation rate and equity rate of return
Replies: 27
Views: 1330

Re: Projected inflation rate and equity rate of return

2010-2019 was supposed to be the "lost decade" of low returns. People were saying we were in for 4% returns on equities. Fast forward for the 10 years Jan. 2010 through Dec. 2019 well we had 13.43% nominal returns, 11.47% inflation adjusted (according to portfolio visualizer on VTI). 2010 to 2019 h...
by knpstr
Thu Sep 10, 2020 3:52 pm
Forum: Personal Consumer Issues
Topic: Cardio alternatives to treadmills?
Replies: 107
Views: 6927

Re: Cardio alternatives to treadmills?

Not sure how walking on a treadmill would be less forgiving or less natural than "power walking" on flat concrete. Could be a shoe/arch problem translating to lower back pain. Flat surfaces, whatever material they may be, are not natural (the reason why shoes have arches built up in them) to be on a...
by knpstr
Thu Sep 10, 2020 9:53 am
Forum: Personal Finance (Not Investing)
Topic: Projected inflation rate and equity rate of return
Replies: 27
Views: 1330

Re: Projected inflation rate and equity rate of return

2010-2019 was supposed to be the "lost decade" of low returns. People were saying we were in for 4% returns on equities.

Fast forward for the 10 years Jan. 2010 through Dec. 2019 well we had 13.43% nominal returns, 11.47% inflation adjusted (according to portfolio visualizer on VTI).
by knpstr
Tue Sep 08, 2020 10:24 am
Forum: Investing - Theory, News & General
Topic: Is it really passive index if S&P actively excludes Tesla?
Replies: 145
Views: 9960

Re: S&P snubs Tesla

Is Tesla an iPhone on wheels? Yes The iPhone is essentially a ~$1T business. (roughly 50% more or less of apple's business) Tesla would love to be an iPhone on wheels. I don't think it has been proven to be such. Nearly all new vehicles are "iPhones on wheels" in my opinion. For example, we recentl...
by knpstr
Thu Sep 03, 2020 4:15 pm
Forum: Investing - Theory, News & General
Topic: Bear Cub Smells Bubble
Replies: 406
Views: 29354

Re: Bear Cub Smells Bubble

Top 5 companies in the S&P500 now make up 25%, not concerning to anyone? Has happened during huge bubbles near the peak No. If I was a market timer I'd almost have surely sold very early this year when the pandemic was coming in full force, would still be sitting on the sidelines (pandemic is still...
by knpstr
Thu Sep 03, 2020 6:52 am
Forum: Investing - Theory, News & General
Topic: Bear Cub Smells Bubble
Replies: 406
Views: 29354

Re: Bear Cub Smells Bubble

Top 5 companies in the S&P500 now make up 25%, not concerning to anyone? Has happened during huge bubbles near the peak Gambling 25% of one's worth (in the case of 100/0 investors) on five individual stocks is typically discouraged on this board. Gambling 25% of one's money on individual stocks per...
by knpstr
Thu Sep 03, 2020 6:49 am
Forum: Investing - Theory, News & General
Topic: Bear Cub Smells Bubble
Replies: 406
Views: 29354

Re: Bear Cub Smells Bubble

Top 5 companies in the S&P500 now make up 25%, not concerning to anyone? Has happened during huge bubbles near the peak No. If I was a market timer I'd almost have surely sold very early this year when the pandemic was coming in full force, would still be sitting on the sidelines (pandemic is still...
by knpstr
Wed Sep 02, 2020 3:22 pm
Forum: Investing - Theory, News & General
Topic: Bear Cub Smells Bubble
Replies: 406
Views: 29354

Re: Bear Cub Smells Bubble

Corona crisis: Fed pounces massively and very quickly with unprecedented action. They took massive steps incredibly quickly flooding the system with liquidity. My understanding is that this works in the short run, but it's just a bridge to economic recovery. If the economy doesn't recover at the en...
by knpstr
Mon Aug 31, 2020 10:02 pm
Forum: Investing - Theory, News & General
Topic: Bear Cub Smells Bubble
Replies: 406
Views: 29354

Re: Bear Cub Smells Bubble

Stocks in ‘Euphoric Land’ With Nasdaq 100 Surging Past 12,000 https://www.bloomberg.com/news/articles/2020-08-31/stocks-in-euphoric-land-with-nasdaq-100-surging-past-12-000?srnd=premium "A sentiment gauge, Citigroup’s panic/euphoria model, which tracks metrics from options trading to short sales an...
by knpstr
Thu Aug 27, 2020 1:54 pm
Forum: Investing - Theory, News & General
Topic: Bear Cub Smells Bubble
Replies: 406
Views: 29354

Re: Bear Cub Smells Bubble

Ultimately interest rates and valuations are intertwined. And with the historic low interest rates we have today we should see historic high valuations. Except for Europe and Japan and much of the rest of the developed world markets, where interest are as low or lower than US rates, yet valuations ...
by knpstr
Thu Aug 27, 2020 6:52 am
Forum: Investing - Theory, News & General
Topic: Bear Cub Smells Bubble
Replies: 406
Views: 29354

Re: Bear Cub Smells Bubble

Ultimately interest rates and valuations are intertwined. And with the historic low interest rates we have today we should see historic high valuations. Except for Europe and Japan and much of the rest of the developed world markets, where interest are as low or lower than US rates, yet valuations ...
by knpstr
Wed Aug 26, 2020 1:06 pm
Forum: Investing - Theory, News & General
Topic: Bear Cub Smells Bubble
Replies: 406
Views: 29354

Re: Bear Cub Smells Bubble

Where are you finding the data to make statements 6 and 7? It seems more people are piling into stocks ever since pensions have been going the way of the dodo. I don't doubt that at anytime people are day trading, but how do you know it is more so than usual? Ultimately interest rates and valuations...
by knpstr
Tue Aug 25, 2020 3:18 pm
Forum: Investing - Theory, News & General
Topic: The 0.5% Rule (SWR) [Safe Withdrawal Rate]
Replies: 419
Views: 23416

Re: The 0.5% Rule (SWR)

How do these numbers work? "To recap: 20x income or 33x expected expenses whichever is higher is a nice rule of thumb for high earners with currently low expenses when ballparking a target amount for FIRE. Since you cannot, having a 2nd sanity check isn't a bad thing to have." How does the sanity c...
by knpstr
Tue Aug 25, 2020 3:15 pm
Forum: Investing - Theory, News & General
Topic: The 0.5% Rule (SWR) [Safe Withdrawal Rate]
Replies: 419
Views: 23416

Re: The 0.5% Rule (SWR)

If you want to use median income of family of 4 for your target of ideal expenses that is fine.... but you're still ultimately estimating expenses. Nope. It's not estimating expenses at all. It's having a desired income goal for retirement and just LBYM. Have 5 kids instead of 2? Expenses will be h...
by knpstr
Tue Aug 25, 2020 3:04 pm
Forum: Investing - Theory, News & General
Topic: The 0.5% Rule (SWR) [Safe Withdrawal Rate]
Replies: 419
Views: 23416

Re: The 0.5% Rule (SWR)

It's not my number, it's from Sam. Reading the links to past blog posts it appears based largely on NW targets by age and happens to be the average NW target for age 60 and an expected 80% of final income for retirement expenses planning . I'm guessing on 80% part since he doesn't explicitly say an...
by knpstr
Tue Aug 25, 2020 1:34 pm
Forum: Investing - Theory, News & General
Topic: The 0.5% Rule (SWR) [Safe Withdrawal Rate]
Replies: 419
Views: 23416

Re: The 0.5% Rule (SWR)

It's not my number, it's from Sam. Reading the links to past blog posts it appears based largely on NW targets by age and happens to be the average NW target for age 60 and an expected 80% of final income for retirement expenses planning. I'm guessing on 80% part since he doesn't explicitly say any...
by knpstr
Mon Aug 24, 2020 1:23 pm
Forum: Investing - Theory, News & General
Topic: The 0.5% Rule (SWR) [Safe Withdrawal Rate]
Replies: 419
Views: 23416

Re: The 0.5% Rule (SWR)

How does your income rule work with these numbers then..... "20x income isn’t perfect but for high earners it’s safer than 25x expenses." How does that work for a couple with these %'s then? - 45% gross is taxes - 35% gross is savings - 20% of gross is expenses while working - 15% of gross income w...
by knpstr
Mon Aug 24, 2020 6:39 am
Forum: Investing - Theory, News & General
Topic: The 0.5% Rule (SWR) [Safe Withdrawal Rate]
Replies: 419
Views: 23416

Re: The 0.5% Rule (SWR) [Safe Withdrawal Rate]

$30K a year off $1M is not way to much money. Neither is $60K with $2M. What I was saying is $1M is in all likelihood way too much money if you just want $30K a year and adjusted for inflation. The idea that 3% is some kind of wildly high withdrawal rate is nonsense. It is ultra-conservative already.
by knpstr
Mon Aug 24, 2020 6:36 am
Forum: Investing - Theory, News & General
Topic: The 0.5% Rule (SWR) [Safe Withdrawal Rate]
Replies: 419
Views: 23416

Re: The 0.5% Rule (SWR) [Safe Withdrawal Rate]

It is all just opinions.I say live your life financially in a way that you sleep well at night.Whatever you are comfortable with risk wise is personal. I really do not see the problem with being more cautious with your projections when choosing to retire at a young age.I am 68 and have had 4 major ...
by knpstr
Sun Aug 23, 2020 7:36 pm
Forum: Investing - Theory, News & General
Topic: The 0.5% Rule (SWR) [Safe Withdrawal Rate]
Replies: 419
Views: 23416

Re: The 0.5% Rule (SWR) [Safe Withdrawal Rate]

You can disagree without making up ridiculous things that were not said or implied. But that is ok. I think it is a reasonable thing for a young retiree to figure what they think they need to last for 40 ,maybe 50 years and add a cushion. I guess it is easy for some to predict 40 years of spending,...
by knpstr
Sat Aug 22, 2020 7:29 pm
Forum: Investing - Theory, News & General
Topic: The 0.5% Rule (SWR) [Safe Withdrawal Rate]
Replies: 419
Views: 23416

Re: The 0.5% Rule (SWR) [Safe Withdrawal Rate]

The thing is most people aren't close to the buzzer. They are still 1-1.5 quarter from the end of the game for most people. The prevent D approach works until it doesn't.... Obviously all analogies have limits but with 20-40 year time frames it is really hard to know if you have won the game or if ...
by knpstr
Fri Aug 21, 2020 9:31 pm
Forum: Investing - Theory, News & General
Topic: The 0.5% Rule (SWR) [Safe Withdrawal Rate]
Replies: 419
Views: 23416

Re: The 0.5% Rule (SWR)

zaboomafoozarg wrote: Fri Aug 21, 2020 8:35 pm That seems pretty close to the audience of this forum over the last 10 years :D

Of which I am admittedly one. This place has helped me make and save money, but the more I get the more I worry.

Around every corner lurks a black swan just waiting to decimate me.
Mo money, mo problems.
by knpstr
Fri Aug 21, 2020 9:29 pm
Forum: Investing - Theory, News & General
Topic: The 0.5% Rule (SWR) [Safe Withdrawal Rate]
Replies: 419
Views: 23416

Re: The 0.5% Rule (SWR) [Safe Withdrawal Rate]

You are 100 pct correct. I purchased a couple myga’s and there is some risk there. I have some GO muni’s, same there. I have a good amount of IBonds which have, I guess, no risk minus the end of the world.I have a lot of CD’s that have reinvestment risk, which is why I bought the myga’s to help wit...
by knpstr
Fri Aug 21, 2020 6:42 am
Forum: Investing - Theory, News & General
Topic: The 0.5% Rule (SWR) [Safe Withdrawal Rate]
Replies: 419
Views: 23416

Re: The 0.5% Rule (SWR) [Safe Withdrawal Rate]

Yes. Be able to live on fixed income investments. I am talking about a person who has a CHOICE to retire.With today’s fixed income return it is a lot more difficult of course. As I said earlier, better make sure you have a lot more money than you think you will need. Put it under the mattress amoun...
by knpstr
Thu Aug 20, 2020 3:15 pm
Forum: Investing - Theory, News & General
Topic: The 0.5% Rule (SWR) [Safe Withdrawal Rate]
Replies: 419
Views: 23416

Re: The 0.5% Rule (SWR) [Safe Withdrawal Rate]

Certainly not needing to draw 3 or4 pct of your portfolio and choosing to retire early, choosing being the key word. I would say having your expenses covered so that you can live a comfortable life without having to depend on the stock market. I understand that I am being ultra conservative and tha...
by knpstr
Thu Aug 20, 2020 2:45 pm
Forum: Investing - Theory, News & General
Topic: The 0.5% Rule (SWR) [Safe Withdrawal Rate]
Replies: 419
Views: 23416

Re: The 0.5% Rule (SWR) [Safe Withdrawal Rate]

Does the uncertainty ever go away? At 70, you may still have 20+ years to live. As you say, who knows what can happen? Should one just keep working until they die? Never said that. I retired unexpectedly but happily at 65. My point is the younger you are the more risk you take retiring early so mak...
by knpstr
Thu Aug 20, 2020 2:19 pm
Forum: Investing - Theory, News & General
Topic: The 0.5% Rule (SWR) [Safe Withdrawal Rate]
Replies: 419
Views: 23416

Re: The 0.5% Rule (SWR)

If you don't know if $97.5k is the right number, then How can you possibly know if your $3M is even close to the right number? What if your expense end up double that amount? How does considering income help in any way? It doesn't. Thinking in terms of income just adds more steps to getting to your...
by knpstr
Thu Aug 20, 2020 1:17 pm
Forum: Investing - Theory, News & General
Topic: The 0.5% Rule (SWR) [Safe Withdrawal Rate]
Replies: 419
Views: 23416

Re: The 0.5% Rule (SWR) [Safe Withdrawal Rate]

... Point being, argue all you want but the best laid plans are subject to so many unknowns the more you extend the years. So before you decide to quit that job because some calculator says you can, just make sure you have way more money than you think you need. Generally speaking this is what thos...
by knpstr
Thu Aug 20, 2020 12:14 pm
Forum: Investing - Theory, News & General
Topic: The 0.5% Rule (SWR) [Safe Withdrawal Rate]
Replies: 419
Views: 23416

Re: The 0.5% Rule (SWR)

Everyone knows their spending can change year to year. You aren’t making any sense. It doesn’t matter how much you earn, it matters how much you spend. I agree. He has himself trapped in some kind of confused thinking. Or maybe I'm not confused and just believe differently based on life experiences...
by knpstr
Thu Aug 20, 2020 8:52 am
Forum: Investing - Theory, News & General
Topic: The 0.5% Rule (SWR) [Safe Withdrawal Rate]
Replies: 419
Views: 23416

Re: The 0.5% Rule (SWR)

20x income isn’t perfect but for high earners it’s safer than 25x expenses. 33x sounds like “enough” but not if your expenses double. Everyone knows their spending can change year to year. You aren’t making any sense. It doesn’t matter how much you earn, it matters how much you spend. I agree. He h...
by knpstr
Thu Aug 20, 2020 7:29 am
Forum: Investing - Theory, News & General
Topic: The 0.5% Rule (SWR) [Safe Withdrawal Rate]
Replies: 419
Views: 23416

Re: The 0.5% Rule (SWR)

20x income isn’t perfect but for high earners it’s safer than 25x expenses. This is true so long 20x income > than 25x expenses. I'd argue tracking expenses is much more indicative what you'll "need", however if nothing else it "standardizes the language". So 20x income is effectively meaningless b...
by knpstr
Wed Aug 19, 2020 9:27 pm
Forum: Investing - Theory, News & General
Topic: Is picking and choosing indexes a bad idea?
Replies: 8
Views: 980

Re: Is picking and choosing indexes a bad idea?

Yes, it would be "anti-bogle" to try to market time individual indexes hoping to buy low then sell them high, like some do with individual stocks. Market timing is market timing no matter the security. It is a bad strategy. Not if rebalancing is the goal, in which case buying low and selling high i...
by knpstr
Wed Aug 19, 2020 3:33 pm
Forum: Personal Consumer Issues
Topic: Anyone noticed La-Z-Boy quality has declined?
Replies: 31
Views: 2727

Re: Anyone noticed La-Z-Boy quality has declined?

We have a La-Z-Boy rocker recliner we bought in 1971! The upholstery and mechanism are still in excellent condition. We paid $99 for it at a department store warehouse sale. Interestingly, prices are about the same. $99 in 1971 is equivalent to $644 today. We bought two la-z-boy rocker recliners in...
by knpstr
Mon Aug 17, 2020 6:44 pm
Forum: Investing - Theory, News & General
Topic: The 0.5% Rule (SWR) [Safe Withdrawal Rate]
Replies: 419
Views: 23416

Re: The 0.5% Rule (SWR)

oldfort wrote: Mon Aug 17, 2020 6:28 pm Well, regardless 61 years is a lot less than 200 years, so if anything, you've vindicated my original point. It's nonsensical to pretend the money will or should last 200 years.
You said the same thing the OP of this side discussion said.
Well done.
by knpstr
Mon Aug 17, 2020 6:12 pm
Forum: Investing - Theory, News & General
Topic: The 0.5% Rule (SWR) [Safe Withdrawal Rate]
Replies: 419
Views: 23416

Re: The 0.5% Rule (SWR)

Assume 3.5% inflation and a 0.5% withdrawal, you have an effective withdrawal rate of 4%. If the money is literally under a mattress, it's gone in 25 years. 25 years might be the length of an average retirement, but it's nowhere near 200 years. 0.5% is ridiculously conservative for any diversified ...
by knpstr
Mon Aug 17, 2020 3:48 pm
Forum: Investing - Theory, News & General
Topic: The 0.5% Rule (SWR) [Safe Withdrawal Rate]
Replies: 419
Views: 23416

Re: The 0.5% Rule (SWR)

$1 under the mattress in 1920 would be worth less than ten cents today in purchasing power. Pretending inflation doesn’t exist is totally nonsensical. "If you stick the money under a mattress, a 0.5% withdrawal rate lasts for 200 years. Even if you account for inflation, it sounds overly conservati...
by knpstr
Mon Aug 17, 2020 2:24 pm
Forum: Investing - Theory, News & General
Topic: The 0.5% Rule (SWR) [Safe Withdrawal Rate]
Replies: 419
Views: 23416

Re: The 0.5% Rule (SWR)

How can you completely ignore taxation? If taxes eat 1% each year, then your effective withdrawal rate is 1.5%: 0.5% to you plus 1% to Uncle Sam. How would taxes eat 1% If you are only spending 0.5%? That would be some crazy high effective tax rate! Assuming your money is all in taxable accounts, y...
by knpstr
Sun Aug 16, 2020 8:27 pm
Forum: Investing - Theory, News & General
Topic: The 0.5% Rule (SWR) [Safe Withdrawal Rate]
Replies: 419
Views: 23416

Re: The 0.5% Rule (SWR)

Stock indices do not equal the world economy. The indices do not represent all businesses or production, and in fact are very top heavy. Only a handful of firms need to fail for the indices to fail to provide the return investors may need from them, which I would consider a failure. Additionally, t...
by knpstr
Sun Aug 16, 2020 7:44 pm
Forum: Investing - Theory, News & General
Topic: The 0.5% Rule (SWR) [Safe Withdrawal Rate]
Replies: 419
Views: 23416

Re: The 0.5% Rule (SWR)

If stocks don’t go up in the long term, what are you doing on this forum? I am following Step 4 of the Bogleheads investment philosophy: Diversify . So you are diversifying away from the most powerful and primary Boglehead asset (equity index funds)? How do you expect this to be received by Boglehe...
by knpstr
Sun Aug 16, 2020 6:13 pm
Forum: Investing - Theory, News & General
Topic: The 0.5% Rule (SWR) [Safe Withdrawal Rate]
Replies: 419
Views: 23416

Re: The 0.5% Rule (SWR)

So with your assumption that technological advancements will continue, you think a 4.5-5% withdrawal rate will be good? Again, can you provide data on why you think the safe or perpetual withdrawal rates will go down with these continued incredible technological advancements created by public compa...
by knpstr
Sun Aug 16, 2020 3:17 pm
Forum: Personal Investments
Topic: Talk me out of Covid 19 timing
Replies: 119
Views: 7875

Re: Talk me out of Covid 19 timing

Shouldn't the fact that you want to be talked out of it be evidence enough to you that you shouldn't do it?
by knpstr
Sun Aug 16, 2020 9:36 am
Forum: Investing - Theory, News & General
Topic: The 0.5% Rule (SWR) [Safe Withdrawal Rate]
Replies: 419
Views: 23416

Re: The 0.5% Rule (SWR)

What's the point? Why even plan if that ends up being the result? It's as ludicrous as Suzy Orman saying you need 6$million to retire. Seriously if you get below 3% then people are just gonna blow it off, spend it all on cruises, claim SS early and hope for the best, move back in with the kids, [po...
by knpstr
Sun Aug 16, 2020 9:06 am
Forum: Investing - Theory, News & General
Topic: The 0.5% Rule (SWR) [Safe Withdrawal Rate]
Replies: 419
Views: 23416

Re: The 0.5% Rule (SWR)

When the author, Sam Dogen, said not long ago that his family could not live comfortably in San Francisco on $250k of annual income, more than double that area's median household income and about four times the nation's median household income, it became clear to me that his advice is no longer app...
by knpstr
Sat Aug 15, 2020 10:08 pm
Forum: Investing - Theory, News & General
Topic: The 0.5% Rule (SWR) [Safe Withdrawal Rate]
Replies: 419
Views: 23416

Re: The 0.5% Rule (SWR)

If you stick the money under a mattress, a 0.5% withdrawal rate lasts for 200 years. Even if you account for inflation, it sounds overly conservative. 200 years ignores inflation and taxation. 0.5% annual withdrawal from your mattress lasts 200 years regardless of the fraction of each withdrawal th...
by knpstr
Sat Aug 15, 2020 10:06 pm
Forum: Investing - Theory, News & General
Topic: Is picking and choosing indexes a bad idea?
Replies: 8
Views: 980

Re: Is picking and choosing indexes a bad idea?

Yes, it would be "anti-bogle" to try to market time individual indexes hoping to buy low then sell them high, like some do with individual stocks. Market timing is market timing no matter the security. It is a bad strategy.
by knpstr
Sat Aug 15, 2020 10:02 pm
Forum: Investing - Theory, News & General
Topic: The 0.5% Rule (SWR) [Safe Withdrawal Rate]
Replies: 419
Views: 23416

Re: The 0.5% Rule (SWR)

Hahaha really? You guys think you have to pay tax on cash that you save in your house? He said if you "just put it under your mattress" Meaning it is all cashed out/taxed. It isn't getting taxed again. Inflation is a tax. And it will be taxed when it is used (sales/property/etc taxes). Thanks. The ...