Search found 1949 matches

by Tamalak
Wed Sep 07, 2022 8:58 am
Forum: Personal Investments
Topic: 100% in the S&P 500. Are we taking too much risk?
Replies: 150
Views: 15656

Re: 100% in the S&P 500. Are we taking too much risk?

kumjan wrote: Wed Sep 07, 2022 8:09 am I recently rebalanced our portfolio from 75/25 US/ex-US to 100 US, and all in the S&P500. Do you think this is too much US equity concentration?

(The oldest of us (the couple) is 40 years old. We will not need this money for 15 to 20 years. We have stable jobs and enough cash for emergencies.)

What do you think?
I don't think 100% S&P is much riskier than 75% S&P and 25% international. But why are you doing it?
by Tamalak
Wed Sep 07, 2022 7:59 am
Forum: Investing - Theory, News & General
Topic: Grok's Tip #11: Take Grok's pledge!
Replies: 188
Views: 33872

Re: Grok's Tip #11: Take Grok's pledge!

I'm violating #3 and #5 :(
by Tamalak
Tue Sep 06, 2022 12:18 pm
Forum: Non-US Investing
Topic: Strategy: Rent for life and invest the difference [Belgium]
Replies: 35
Views: 3197

Re: Strategy: Rent for life and invest the difference

Been renting and investing. Enjoying the simplicity of renting, the flexibility to move, and general portability of our life. Letting the landlord deal with issues and cost of ownership increases is fantastic. Houses, apartments, and more can all be rented at all levels. YMMV based on how you manage your portfolio and budget. +1. I see owning property as similar to a stock investment. Both increase in underlying value (usually) and both have yearly returns - rent for the property (expressed as the lack of rent you have to pay if you live there), and earnings for the stock. The advantages of stocks over property is it's easier to diversify, requires no maintenance, and is weightless. The advantages of property over stocks is margin (no bank...
by Tamalak
Tue Sep 06, 2022 11:22 am
Forum: Investing - Theory, News & General
Topic: Total Bond Fund starts to self-correct
Replies: 269
Views: 29371

Re: Total Bond Fund starts to self-correct

If

1. I am buying chickens with my paycheck with the intention of eventually having enough chickens that I can live off their eggs forever, and

2. The price of chickens goes down but the eggs they're laying is unaffected, then

3. My net worth goes down but my plan is benefitted.
by Tamalak
Tue Sep 06, 2022 10:12 am
Forum: Personal Investments
Topic: Fixed Withdrawal Rate - 5 or 6%?
Replies: 214
Views: 18875

Re: Fixed Withdrawal Rate - 5 or 6%?

I've never seen this discussed so probably not a great idea due to market volatility, but I like the simplicity. What if you simply take say X% (5% maybe 6%?) of your current portfolio balance and withdrawal that every year. Maybe you even keep a year or two emergency fund and have human capital to help cover expenses during major bear markets or help against sequence risk. No spreadsheets, no need to calculate in inflation every year, no worrying about running out of money. Can I backtest this anyplace to see the variance in withdrawals year after year? This is exactly what I do. I have two "buckets", stocks and bonds. Every year 3.8% (currently) of existing stocks gets moved to bonds. Bonds are sold as needed to pay expenses. J...
by Tamalak
Tue Sep 06, 2022 9:27 am
Forum: Personal Finance (Not Investing)
Topic: Unhappy with golden handcuffs
Replies: 96
Views: 13398

Re: Unhappy with golden handcuffs

You should leave your job (and give it to me :D )
by Tamalak
Fri Sep 02, 2022 9:39 pm
Forum: Investing - Theory, News & General
Topic: Why People Make Dumb Financial Decisions on Purpose By Ben Carlson
Replies: 53
Views: 7584

Re: Why People Make Dumb Financial Decisions on Purpose By Ben Carlson

Interesting article and discussion here. Diminishing marginal value of money is also a thing. The first million dollars I earn is a LOT more valuable than the second million. The article - and this topic, is less about people making dumb financial decisions and more about how simplistic math can lead you to the wrong conclusion. Agreed. I'd take the $1 million at this point in my life. That's not a "dumb" financial decision at all. 20 years from now, I'd probably take a chance on the $50 million. But what if the choices were: 100% of $500,000 vs. 50% of $50 million ? Would you be less influenced by the 100% certainty if it were not a "cool" million? What if the choices presented to you were getting progressively better,...
by Tamalak
Fri Sep 02, 2022 1:25 pm
Forum: Personal Investments
Topic: Why is portability of funds a big deal?
Replies: 43
Views: 2942

Re: Why is portability a big deal?

It's not a big deal until it is. I've never had a reason to change my brokerage, but I'd feel nervous about having non portable funds.
by Tamalak
Fri Sep 02, 2022 1:21 pm
Forum: Investing - Theory, News & General
Topic: Why People Make Dumb Financial Decisions on Purpose By Ben Carlson
Replies: 53
Views: 7584

Re: Why People Make Dumb Financial Decisions on Purpose By Ben Carlson

"net present value" is different per entity. If I have 20%-interest credit card debt, the discount rate of money is at least 20%. Lump sum is sometimes the better deal.

Diminishing marginal value of money is also a thing. The first million dollars I earn is a LOT more valuable than the second million.

The article - and this topic, is less about people making dumb financial decisions and more about how simplistic math can lead you to the wrong conclusion.
by Tamalak
Fri Sep 02, 2022 12:37 pm
Forum: Personal Investments
Topic: Buying the dip, internationally
Replies: 14
Views: 2258

Re: Buying the dip, internationally

I feel optimistic about international future returns. But I've been feeling that way for years. I don't budge from my market cap strategy on feeling.
by Tamalak
Wed Aug 31, 2022 12:03 pm
Forum: Personal Investments
Topic: How much is enough for a single man to retire?
Replies: 91
Views: 17768

Re: How much is enough for a single man to retire?

sailaway wrote: Tue Aug 30, 2022 4:35 pm
newyorker wrote: Tue Aug 30, 2022 4:33 pm With stock dropping, I will need more than 3M lol.

With stocks dropping, if you hit 3M now, you will be really set with the recovery.
This. 3M now is a much stronger position than 3M 8 months ago.
by Tamalak
Tue Aug 30, 2022 1:58 pm
Forum: Personal Investments
Topic: International Stock Allocation
Replies: 155
Views: 16504

Re: International Stock Allocation

I don't think I'm ever really going to get answers on whether international stocks' prices truly represent a self interested free market's best guess as to their discounted future dividends or not, because everyone wants to argue like this instead of explore it. Fair enough. It's a tricky issue to explore, in truth, because it requires us to understand whether OTHER US investors who are avoiding international stocks are doing so for rational reasons (e.g. taxes) or irrational reasons. It's akin to the challenge of figuring out whether AutoZone Inc "deserves" to be cheaper than Amazon Inc. Yeah and that's the other thing. If mysterious forces are making international prices irrational, it's just as likely to be irrationally LOW.. ...
by Tamalak
Tue Aug 30, 2022 12:31 pm
Forum: Personal Investments
Topic: International Stock Allocation
Replies: 155
Views: 16504

Re: International Stock Allocation

International vs US only is really a religious decision There are arguments for International and arguments for US only. This is a false equivalence. The arguments for international diversification are based on the fundamental financial principle of diversification and the wisdom of not taking uncompensated risks. The arguments for US-only investing are based on some combination of performance chasing, American exceptionalism, and/or xenophobia. There's a difference. As an international-diversification type investor, I'm mostly interested in hearing arguments as to what forces might hold down international returns. If international stocks are driven entirely by free market profit-seekers, it makes sense to hold VT only. But I've always had...
by Tamalak
Tue Aug 30, 2022 8:28 am
Forum: Personal Investments
Topic: International Stock Allocation
Replies: 155
Views: 16504

Re: International Stock Allocation

International vs US only is really a religious decision There are arguments for International and arguments for US only. This is a false equivalence. The arguments for international diversification are based on the fundamental financial principle of diversification and the wisdom of not taking uncompensated risks. The arguments for US-only investing are based on some combination of performance chasing, American exceptionalism, and/or xenophobia. There's a difference. As an international-diversification type investor, I'm mostly interested in hearing arguments as to what forces might hold down international returns. If international stocks are driven entirely by free market profit-seekers, it makes sense to hold VT only. But I've always had...
by Tamalak
Mon Aug 29, 2022 10:09 pm
Forum: Personal Investments
Topic: How much is enough for a single man to retire?
Replies: 91
Views: 17768

Re: How much is enough for a single man to retire?

My biggest fear is being treated like a trash at nursing home. Money will never solve that problem. You will need family to overcome that problem. Rosebud. Does family solve that though? Ive seen alot of old man/woman literally dumped into nursing home and barely anyone come in and visit them... that made me think about life. And I have seen a living corpse kept alive for its monthly social security check. So if family won't solve the problem, then working on your well-being and health might? I dont think it will either. Philosophical question. What is the point of working hard and reaching FI when we will eventually turn into a dust. Not much, in my opinion. That's why I'm going to research longevity when I'm financially independent. Age ...
by Tamalak
Mon Aug 29, 2022 3:41 pm
Forum: Investing - Theory, News & General
Topic: [How do you stay positive when the goal posts keep moving?]
Replies: 87
Views: 8673

Re: Are Bogleheads the 1%?

I'm nowhere near the 1%.. I make low six figures. But this forum has been invaluable for me!
by Tamalak
Mon Aug 29, 2022 3:16 pm
Forum: Personal Finance (Not Investing)
Topic: Retirees aren't spending their nestegg - how can we do better?
Replies: 148
Views: 12975

Re: Retirees aren't spending their nestegg - how can we do better?

Such people shouldn't spend more, they should have retired earlier!
by Tamalak
Mon Aug 29, 2022 2:34 pm
Forum: Personal Investments
Topic: How much is enough for a single man to retire?
Replies: 91
Views: 17768

Re: How much is enough for a single man to retire?

30x your expected yearly expenses is fine IMO. As a single guy I'm aiming for about 1.5 million and a 50k withdrawal rate
by Tamalak
Mon Aug 29, 2022 1:16 pm
Forum: Personal Investments
Topic: International Stock Allocation
Replies: 155
Views: 16504

Re: International Stock Allocation

VT and chill :D

For any given period, one side will outperform the other, and those who held all that side will say "I knew it" (they didn't)
by Tamalak
Mon Aug 29, 2022 9:30 am
Forum: Personal Investments
Topic: 2.5MM self managed but should I get help?
Replies: 40
Views: 7997

Re: 2.5MM self managed but should I get help?

Don't let some financial "advisor" touch your hard earned money. If you need help come here. It looks like you've done great.
by Tamalak
Mon Aug 29, 2022 8:42 am
Forum: Personal Investments
Topic: Going to the DOGs [ProShares Short Dow30]
Replies: 39
Views: 4701

Re: Going to the DOGs

My jaw dropped when I saw what DOG is! Your husband is betting against the future, without even a clear reason. DOG inevitably goes down in the long run. It is a tool for high intensity market timers, not someone just vaguely messing around to satisfy their need to do something and gratify their egos (such people should at the very least pick stocks.. not monstrous financial tools like this).

This is more serious than "bogleheads vs not". Ask him if he even knows what DOG is and what his long term plan is with it.

And no, DOG can't get worse than a total loss of principal. In fact the DOW would technically have to go to infinity for DOG to hit 0.
by Tamalak
Sat Aug 27, 2022 9:30 am
Forum: Investing - Theory, News & General
Topic: Reducing psychological pain
Replies: 80
Views: 8163

Re: Reducing psychological pain

I don't avoid it, but after a while in the market it feels normal for your NW to go up and down.

I was way more upset about my first loss than my most recent loss which is 50x more.
by Tamalak
Wed Aug 24, 2022 11:51 am
Forum: Personal Finance (Not Investing)
Topic: Selling international funds to reduce mortgage balance
Replies: 123
Views: 6578

Re: Selling international funds to reduce mortgage balance

nrkv wrote: Wed Aug 24, 2022 10:37 am “Performance chasing” - that’s the word I’ve been missing the last couple of days when I started on this rabbit hole. I guess inherently I was trying to get at least 3.5% return on international funds. I’ll leave it as is for now.
Thanks, as always.
Even if you bought in 2000 - the worst possible time - your CAGR for international stocks is about 3.5% - investing any other time would leave you with considerably more. I started in 2016 and mine is 5.6%
by Tamalak
Mon Aug 22, 2022 8:06 am
Forum: Personal Investments
Topic: I’m Unable to Re-Balance: OK or not, and what does it imply?
Replies: 46
Views: 3903

Re: I’m Unable to Re-Balance: OK or not, and what does it imply?

I personally do not rebalance. I believe in inertia more than I believe in AA. Investments I make will ride as long as possible.

OP could you elaborate on why you feel psychologically unable to rebalance, though? That's a new one.
by Tamalak
Fri Aug 19, 2022 10:53 am
Forum: Investing - Theory, News & General
Topic: ‘Frogs in boiling water’: Urgent warning for 50% market drop
Replies: 188
Views: 36015

Re: ‘Frogs in boiling water’: Urgent warning for 50% market drop

Bond rates are now normalized. Not sure about this: Nominal 10-year Treasury yields remain at the very low end of what's been seen historically; to find lower nominal rates, you need to look at either the period when we were on the gold standard and inflation expectations were about zero, the period when rates were set politically rather than by the Fed board, and the "ZIRP/QE" era expected real yields of nominal 10-year Treasurys are quite low no matter how you reckon it - deeply negative by applying a 0th- or 1st-order hold to inflation data, fractionally positive if you look at inflation expectation surveys, fractionally positive if you look at nominal Treasury/TIPS breakeven inflation the yield curve has a really weird shape:...
by Tamalak
Fri Aug 19, 2022 9:56 am
Forum: Investing - Theory, News & General
Topic: ‘Frogs in boiling water’: Urgent warning for 50% market drop
Replies: 188
Views: 36015

Re: ‘Frogs in boiling water’: Urgent warning for 50% market drop

Billionaire Seth Klarman — whose letters to clients of his Boston-based fund Baupost Group are closely read on Wall Street — said the Fed’s pandemic-fueled policies of keeping rates close to zero have not stimulated the economy but instead sent the market flying beyond reason and made investors recklessly unafraid of risk. “Trying to figure out if the economy is in recession is like trying to assess if you had a fever after you just took a large dose of aspirin,” Klarman wrote, according to a report by the Financial Times (paywall). “But as with frogs in water that is slowly being heated to a boil, investors are being conditioned not to recognize the danger.” https://nypost.com/2021/01/21/seth-klarman-likens-investors-to-frogs-slowly-boili...
by Tamalak
Thu Aug 18, 2022 9:52 pm
Forum: Investing - Theory, News & General
Topic: Stock market from 2000 - 2013
Replies: 99
Views: 6867

Re: Stock market from 2000 - 2013

An accumulator need not worry about 1966s or 2000s. A new retiree does.
by Tamalak
Thu Aug 18, 2022 11:39 am
Forum: Investing - Theory, News & General
Topic: [Stocks On Sale!]
Replies: 61
Views: 6511

Re: [Stocks On Sale!]

Stocks are on sale if VTI and BLV are BOTH down.

If VTI is down but BLV is up then stocks are not on sale, they're just discounted due to damage lol
by Tamalak
Tue Aug 16, 2022 1:07 pm
Forum: Investing - Theory, News & General
Topic: Why do we market weight USA equity but not global equity?
Replies: 108
Views: 9592

Re: Why do we market weight USA equity but not global equity?

UpperNwGuy wrote: Tue Aug 16, 2022 1:04 pm Vanguard rates VTI as a 4 on their risk/reward scale, but they rate VXUS as a 5. Why should I treat them as having the same risk if Vanguard does not?
VXUS has added currency risk, in the sense that potential upside and downside for VXUS price is even higher than VTI.

But since we're all being paid in dollars, I instead consider VXUS a hedge against a weakening of what I'm paid in.
by Tamalak
Tue Aug 16, 2022 12:56 pm
Forum: Investing - Theory, News & General
Topic: Why do we market weight USA equity but not global equity?
Replies: 108
Views: 9592

Re: Why do we market weight USA equity but not global equity?

Whatever the current king is (USA) will have of course outperformed the others for the last 100 years or so. But 100 years ago, if you invested in the proven success of the time, you'd be underperforming now.
by Tamalak
Thu Aug 11, 2022 4:08 pm
Forum: Personal Investments
Topic: Re-Balancing Question
Replies: 11
Views: 1031

Re: Re-Balancing Question

I'm a big believer in inertia when it comes to investing. Tinkering is a road to ruin. I never rebalance.. new money just goes towards whatever investments I think I should have more of. When I withdraw, I'll withdraw first from what I think I should have less of.
by Tamalak
Mon Aug 08, 2022 10:43 am
Forum: Investing - Theory, News & General
Topic: Past Performance
Replies: 26
Views: 2552

Re: Past Performance

1977-------6.7-----------3.0-------------(-7.2)-------------------17.5
1978-------9.0-----------1.4---------------6.6--------------------33.1
1979------13.3-----------1.9--------------18.4-------------------10.9 (Highest Annual Inflation Rate)
1980------12.5-----------2.7--------------32.4-------------------25.4
1981-------8.9-----------6.3-------------(-4.9)------------------(-2.5)
1982-------3.8----------32.6--------------21.6------------------(-0.3) (Highest Bond Index Return)
I'm impressed that we were able to beat inflation there without bond returns ever going negative.
by Tamalak
Mon Aug 08, 2022 10:43 am
Forum: Investing - Theory, News & General
Topic: Past Performance
Replies: 26
Views: 2552

Re: Past Performance

Marseille07 wrote: Mon Aug 08, 2022 10:39 am
Tamalak wrote: Mon Aug 08, 2022 10:29 am My take-away is that average real returns are suspiciously similar to inverse average P/E, therefore I will be using that to predict future returns!
I sincerely wish you snap out of this. If this were true, ex-US would be beating US left and right the last 30 years as their PE is lower (inverse PE higher).
I cheated a little. WORLD real returns tend to match WORLD inverse P/E. You're right that the returns themselves can be concentrated in certain sectors and the market has a way of raising PE to anticipate that.
by Tamalak
Mon Aug 08, 2022 10:29 am
Forum: Investing - Theory, News & General
Topic: Past Performance
Replies: 26
Views: 2552

Re: Past Performance

Taylor Larimore wrote: Sat Aug 06, 2022 11:12 am
Question: What is your take-away from these statistics?
My take-away is that average real returns are suspiciously similar to inverse average P/E, therefore I will be using that to predict future returns!
by Tamalak
Mon Aug 08, 2022 9:29 am
Forum: Personal Finance (Not Investing)
Topic: Anyone ever explicitly refused promotion for better work-life-balance?
Replies: 90
Views: 9431

Re: Anyone ever explicitly refused promotion for better work-life-balance?

Yes. Recently, in fact. 7% increase in pay for what looks from here like a 30% increase in responsibilities is a no.

I found the reasons for refusing promotion difficult to finesse, so I was just polite, if straight about it. It went fine. My company is having enough problems with retention to second-guess an employee's career decisions!
by Tamalak
Mon Aug 08, 2022 9:04 am
Forum: Investing - Theory, News & General
Topic: Past investment mistakes
Replies: 49
Views: 4880

Re: Past investment mistakes

None of us are born knowing how to invest. It's not a skill our genes prepare us for. Therefore investing wrong isn't a "mistake", it's just a skill that has not been developed, until you work to develop it.

It's like asking how do I get over the fact that I didn't walk for the first year of my life. You're not supposed to.. you were a baby!
by Tamalak
Fri Aug 05, 2022 11:14 am
Forum: Investing - Theory, News & General
Topic: International right now?
Replies: 36
Views: 3078

Re: International right now?

It's a factor for ex-US to be a poor performer period, not as compared to US. US, if adjusted for forward PE, has also had a sunny year. (forward PE start / forward PE end) * (price end / price start) (22.5 / 17.5) * (203.48 / 242.97) = 1.08 not counting dividends which would push it to more like 9% YTD Thanks. I still don't like this adjustment personally but your explanation makes sense. Most people dislike calculations based on "forward PE" because the name implies a prediction of the future. Forward PE is really a calculation based on present variables (if you think about it, any calculation would have to be). As long as you're comparing apples to apples each year, forward PE doesn't really need to be correct to give a ballpa...
by Tamalak
Fri Aug 05, 2022 11:03 am
Forum: Investing - Theory, News & General
Topic: International right now?
Replies: 36
Views: 3078

Re: International right now?

Marseille07 wrote: Fri Aug 05, 2022 11:02 am
Tamalak wrote: Fri Aug 05, 2022 11:01 am Sure it is, if the time value of money goes up. And it has this year, by a lot. In that circumstance, it's not surprising that forward PE has dropped by about 20% for both USA and Intl. (22.5 -> 17.5 for USA, 14.5 -> 11.8 for intl)
Oh OK, I thought you were calling out forward PE as a factor for ex-US to underperform US, which was my original inquiry.
It's a factor for ex-US to be a poor performer period, not as compared to US.

US, if adjusted for forward PE, has also had a sunny year.

(forward PE start / forward PE end) * (price end / price start)

(22.5 / 17.5) * (203.48 / 242.97) = 1.08 not counting dividends which would push it to more like 9% YTD
by Tamalak
Fri Aug 05, 2022 11:01 am
Forum: Investing - Theory, News & General
Topic: International right now?
Replies: 36
Views: 3078

Re: International right now?

Dollar gaining and even more forward PE dropping. Adjusting for those factors, international has gained like 15% YTD lol (forward PE start / forward PE end) * (price end / price start) * (DXY end / DXY start) = underlying international earnings first market day is Jan 3 so that will be start date. Most recent forward PE report at https://www.yardeni.com/pub/mscipemajor.pdf is Aug 3 so that will be end date. (14.5 / 11.8) * (53.02 / 63.98) * (106.51 / 96.21) = 1.13 not counting dividends which would push it to more like 15% YTD.. I don't think we can reasonably adjust for forward PE unless we call today's investors stupid. First, forward PE is an estimate which might be wildly off. Second, the Ukraine situation is still ongoing and the inve...
by Tamalak
Fri Aug 05, 2022 10:36 am
Forum: Investing - Theory, News & General
Topic: International right now?
Replies: 36
Views: 3078

Re: International right now?

Disclaimer: I also thought international was going to do great this year. Have you figured out why it hasn't? Is it all because of the Dollar gaining this year? You guys love to look at CAPE; by this measure, US went from 40 to 30 whereas Europe went from 24 to 20. US should have been in trouble but doing better than international as of July 31, 2022. Dollar gaining and even more forward PE dropping. Adjusting for those factors, international has gained like 15% YTD lol (forward PE start / forward PE end) * (price end / price start) * (DXY end / DXY start) = underlying international earnings first market day is Jan 3 so that will be start date. Most recent forward PE report at https://www.yardeni.com/pub/mscipemajor.pdf is July 28 so that ...
by Tamalak
Fri Aug 05, 2022 9:22 am
Forum: Investing - Theory, News & General
Topic: International right now?
Replies: 36
Views: 3078

Re: International right now?

My sincere opinion is that international is going to do great over 2-3 years. Dollar has nowhere to go but down, PEs have nowhere to go but up barring disaster.

Disclaimer: I also thought international was going to do great this year.
by Tamalak
Thu Aug 04, 2022 11:09 am
Forum: Investing - Theory, News & General
Topic: Shiller - S&P 500 may reach 1430 by 2020
Replies: 90
Views: 37271

Re: Shiller - S&P 500 may reach 1430 by 2020

I sure hope we don't reach 1430 any time soon :shock:
by Tamalak
Thu Aug 04, 2022 10:36 am
Forum: Investing - Theory, News & General
Topic: Watch out for hidden risk tolerance assumptions in SWR claims
Replies: 182
Views: 12524

Re: Watch out for hidden risk tolerance assumptions in SWR claims

snackdog wrote: Thu Aug 04, 2022 10:22 am What is “hidden”? Isn’t it intuitive that stocks are more volatile than bonds and there better suited to a higher and riskier withdrawal profile?
It's hidden by the numbers, like that colored chart above. The more stocks you have the more green (positive chance of success) you get. No brainer to have 100% stocks, right?
by Tamalak
Thu Aug 04, 2022 9:06 am
Forum: Investing - Theory, News & General
Topic: Watch out for hidden risk tolerance assumptions in SWR claims
Replies: 182
Views: 12524

Re: Watch out for hidden risk tolerance assumptions in SWR claims

What I don't like about these "odds your money will last" sites is they seem to assume that you're equally likely to retire every year.

But people are much more likely to hit their number when the market was high. Nobody hit it at the bottom of 2008. So I feel like it might be overly optimistic.
by Tamalak
Thu Aug 04, 2022 8:57 am
Forum: Personal Investments
Topic: Stock up +28075.96%, what would you do?
Replies: 71
Views: 8046

Re: Stock up +28075.96%, what would you do?

My policy is that you only buy individual stocks over index funds if you have a concrete reason to believe the stock is underpriced. And then you sell as soon as you no longer have a concrete reason to believe the stock is underpriced (no matter if the stock has gone up or down in the process).

It looks like you were just doing this 'for fun', but this is no longer a 'fun' amount of money. So I would sell immediately!

I don't understand your numbers though. If you bought 175k worth of something that went up by x280, you would have 50 million! Maybe it's x28?
by Tamalak
Thu Aug 04, 2022 7:44 am
Forum: Investing - Theory, News & General
Topic: Watch out for hidden risk tolerance assumptions in SWR claims
Replies: 182
Views: 12524

Re: "Stocks increase SWR" assumes a risk-tolerant investor

It's a good post. I'm risk-tolerant so far - I didn't even flinch at the covid crash or this year's slump - but this is the accumulation phase. During accumulation phase bears are, in some cases, good, and even if they're bad all they do is shift your retirement schedule a bit.

I sense retirement will be more of a dependent, helpless feeling, since I'm not adding anything more to my portfolio. What will a covid lightning strike feel like then?
by Tamalak
Wed Aug 03, 2022 2:46 pm
Forum: Personal Investments
Topic: FIRE Situation at age 40
Replies: 49
Views: 9297

Re: FIRE Situation at age 40

Value the increase in pension as roughly 25 times the additional yearly payout. Essentially this is the approximate value of a portfolio you would need to take 4% of a year to have the same amount annually. In your example: Current 3 year avg salary of $65k with 40% pension = $26,000 per year x 25 = Value of $650k In one year, 3 year avg of approximately $70k with 42.5% pension = $29,750 per year x 25 = Value of $744k In two years, 3 year avg of approximately $75k with 45% pension = $33,750 per year x 25 = Value of $844k So two years gives you roughly a boost of $194k to your portfolio value. Subsequent years, assuming salary remains stable would add $75k x 0.025 x 25 = $46,875 portfolio value. These numbers are a little rough, but should ...
by Tamalak
Wed Aug 03, 2022 2:17 pm
Forum: Personal Investments
Topic: FIRE Situation at age 40
Replies: 49
Views: 9297

Re: FIRE Situation at age 40

ruandrew09 wrote: Wed Aug 03, 2022 2:13 pm Why aren’t you using your sick days?

Teaching can be exhausting. A “mental health” day every so often helps.
I missed this.

OP, if you're considering quitting your job, then you definitely should stop stressing about keeping it! Being financially independent is a free ticket out of stress. Take it, even if you don't quit. Take every single off day you're accumulated. When you work, do your job the way you want to and not the way you think will satisfy others. People who "judge" you for having a work life balance are trying to cheat you out of what you have earned.
by Tamalak
Wed Aug 03, 2022 2:07 pm
Forum: Personal Investments
Topic: FIRE Situation at age 40
Replies: 49
Views: 9297

Re: FIRE Situation at age 40

I'm in a similar position! Age 39, ~850k net worth (90% VT 9% BNDW 1% cash), not thrilled about my job. Most people would be more cautious than me, but I think a 4% withdrawal rate is reasonable even if you're FIREing. According to Rich, Broke or Dead a 4% withdrawal rate, historically, has a 5 in 6 chance of working indefinitely (not just 30 years.. forever). So if you roll a 1 on that die, you'll have to downgrade or take a part time job or something. No biggie. And that's not taking into account the chances of inheritance or social security. And since all your savings are in brokerage, your income will be tiny and entirely long term capital gains. Taxes will be nothing. Health care will be cheap. Your NW is about 800k. Can you live on 32...