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Personal investment plans

Posted: Sun Sep 16, 2018 8:27 am
by Learning101
[Thread updated, see below. --admin LadyGeek]

Dear all,

I am brand new on here so please forgive me if my question is amateur or even stupid to some of you. I am a huge fan of Jack Bogles books which I have to admit I stumbled across by chance after reading one of Tony Robbins books on wealth.

My question is can anyone advise me on a tool / resource to workout what how much I would need to save per year to achieve x in x amount of years please thus it would make it much easier to choose the right investment product in the first instance.

Again apologises if this is a daft question I am still finding my feet on here.

Best financial site I have come across by far though.

Regards,

Mark

Re: Personal investment plans

Posted: Sun Sep 16, 2018 8:51 am
by Ron Scott
Welcome!

Bankrate has a bunch of calculators you might want to try: https://www.bankrate.com/calculators/in ... ators.aspx

Re: Personal investment plans

Posted: Sun Sep 16, 2018 9:03 am
by stan1
FireCalc is a good tool. FIrst thing to remember is there's no way to predict the future. It may or may not be like the past. FireCalc gets around this dilemma by running a simulation using past data to calculate many possible future outcomes. It then gives you a probability of success on meeting your goals. That's a gross simplification so worth reading more about how it works.

https://www.firecalc.com/

Re: Personal investment plans

Posted: Sun Sep 16, 2018 9:09 am
by billerickson
Portfolio Charts is a great tool for this. You can select one of their pre-built portfolios, or use their Portfolio Growth calculator with a custom portfolio you define.

Re: Personal investment plans

Posted: Sun Sep 16, 2018 9:13 am
by damjam
Learning101 wrote:
Sun Sep 16, 2018 8:27 am
Dear all,

I am brand new on here so please forgive me if my question is amateur or even stupid to some of you. I am a huge fan of Jack Bogles books which I have to admit I stumbled across by chance after reading one of Tony Robbins books on wealth.

My question is can anyone advise me on a tool / resource to workout what how much I would need to save per year to achieve x in x amount of years please thus it would make it much easier to choose the right investment product in the first instance.

Again apologises if this is a daft question I am still finding my feet on here.

Best financial site I have come across by far though.

Regards,

Mark
Welcome

This is the question isn't it?

You'll get a lot of rules of thumb thrown at you and I realize this is not exactly what you asked but I'm going to throw in my 2 cents. Feel free to ignore.

At one point Fidelity put out something suggesting you needed X times your income by X age to be on track for retirement. The problem with that is your income has little to no bearing on what you will need. It's your expenses that matter. So that's the first thing, you need to estimate your future expenses and the further into the future that is the harder it is to do. Any calculator based on income rather than expenses is probably not that accurate. Although I'll admit that in the early days I used income as a proxy for expenses since retirement was many decades away and making an estimate was a shot in the dark.

As far as selecting investment products you need to know what your risk tolerance is. If you're not able to stick to the plan in the downturns the plan isn't the right one for you.

Here's a rule of thumb for you: 25-30 times expenses should be your ideal end goal. If you've save 25 times your expenses it's reasonable to expect that you can have a 25 year retirement, even squeezing out a 30 year retirement is probably attainable.

I found information on safe withdrawal rates to be very helpful. You could start with the Wiki article:https://www.bogleheads.org/wiki/Safe_withdrawal_rates

Re: Personal investment plans

Posted: Sun Sep 16, 2018 9:39 am
by Ron Scott
damjam wrote:
Sun Sep 16, 2018 9:13 am
Learning101 wrote:
Sun Sep 16, 2018 8:27 am
Dear all,

I am brand new on here so please forgive me if my question is amateur or even stupid to some of you. I am a huge fan of Jack Bogles books which I have to admit I stumbled across by chance after reading one of Tony Robbins books on wealth.

My question is can anyone advise me on a tool / resource to workout what how much I would need to save per year to achieve x in x amount of years please thus it would make it much easier to choose the right investment product in the first instance.

Again apologises if this is a daft question I am still finding my feet on here.

Best financial site I have come across by far though.

Regards,

Mark
Here's a rule of thumb for you: 25-30 times expenses should be your ideal end goal. If you've save 25 times your expenses it's reasonable to expect that you can have a 25 year retirement, even squeezing out a 30 year retirement is probably attainable.
This is simple and in my view very good advice. While I would not go so far as trying to squeeze 30 years out of 25X in initial savings for the purposes of planning someone's personal retirement, 25X for 25 years makes sense and is conservative enough to pass the sleep test.

Re: Personal investment plans

Posted: Sun Sep 23, 2018 10:04 am
by Learning101
Ron Scott wrote:
Sun Sep 16, 2018 8:51 am
Welcome!

Bankrate has a bunch of calculators you might want to try: https://www.bankrate.com/calculators/in ... ators.aspx
This great thank you!

Re: Personal investment plans

Posted: Sun Sep 23, 2018 10:05 am
by Learning101
stan1 wrote:
Sun Sep 16, 2018 9:03 am
FireCalc is a good tool. FIrst thing to remember is there's no way to predict the future. It may or may not be like the past. FireCalc gets around this dilemma by running a simulation using past data to calculate many possible future outcomes. It then gives you a probability of success on meeting your goals. That's a gross simplification so worth reading more about how it works.

https://www.firecalc.com/
Thank you for this, much appreciated

Re: Personal investment plans

Posted: Sun Sep 23, 2018 10:05 am
by Learning101
billerickson wrote:
Sun Sep 16, 2018 9:09 am
Portfolio Charts is a great tool for this. You can select one of their pre-built portfolios, or use their Portfolio Growth calculator with a custom portfolio you define.
Thank you for replying

Re: Personal investment plans

Posted: Sun Sep 23, 2018 10:06 am
by Learning101
damjam wrote:
Sun Sep 16, 2018 9:13 am
Learning101 wrote:
Sun Sep 16, 2018 8:27 am
Dear all,

I am brand new on here so please forgive me if my question is amateur or even stupid to some of you. I am a huge fan of Jack Bogles books which I have to admit I stumbled across by chance after reading one of Tony Robbins books on wealth.

My question is can anyone advise me on a tool / resource to workout what how much I would need to save per year to achieve x in x amount of years please thus it would make it much easier to choose the right investment product in the first instance.

Again apologises if this is a daft question I am still finding my feet on here.

Best financial site I have come across by far though.

Regards,

Mark
Welcome

This is the question isn't it?

You'll get a lot of rules of thumb thrown at you and I realize this is not exactly what you asked but I'm going to throw in my 2 cents. Feel free to ignore.

At one point Fidelity put out something suggesting you needed X times your income by X age to be on track for retirement. The problem with that is your income has little to no bearing on what you will need. It's your expenses that matter. So that's the first thing, you need to estimate your future expenses and the further into the future that is the harder it is to do. Any calculator based on income rather than expenses is probably not that accurate. Although I'll admit that in the early days I used income as a proxy for expenses since retirement was many decades away and making an estimate was a shot in the dark.

As far as selecting investment products you need to know what your risk tolerance is. If you're not able to stick to the plan in the downturns the plan isn't the right one for you.

Here's a rule of thumb for you: 25-30 times expenses should be your ideal end goal. If you've save 25 times your expenses it's reasonable to expect that you can have a 25 year retirement, even squeezing out a 30 year retirement is probably attainable.

I found information on safe withdrawal rates to be very helpful. You could start with the Wiki article:https://www.bogleheads.org/wiki/Safe_withdrawal_rates


Your 2 cent is very welcomed, thanks!

Re: Personal investment plans

Posted: Sun Sep 23, 2018 11:32 am
by Okie77
Keep it simple:

A good start is saving 15% of your total gross income. Increasing with raises, bonuses etc. As the years go by.

Re: Personal investment plans

Posted: Sun Sep 23, 2018 11:41 am
by Dottie57
Okie77 wrote:
Sun Sep 23, 2018 11:32 am
Keep it simple:

A good start is saving 15% of your total gross income. Increasing with raises, bonuses etc. As the years go by.
Agree with this. But it is just a beginning. As the years pass, you will need to understand your expenses. If expenses are high, then more savings are needed. It is easier to save now than cut expenses at 70 or 80. And there is never a guarantee you have done it “right”.

Re: Personal investment plans

Posted: Sun Sep 23, 2018 5:52 pm
by pkcrafter
Learning101 wrote:
Sun Sep 16, 2018 8:27 am
Dear all,

I am brand new on here so please forgive me if my question is amateur or even stupid to some of you. I am a huge fan of Jack Bogles books which I have to admit I stumbled across by chance after reading one of Tony Robbins books on wealth.

My question is can anyone advise me on a tool / resource to workout what how much I would need to save per year to achieve x in x amount of years please thus it would make it much easier to choose the right investment product in the first instance.
Here is info that will provide some perspective.

https://www.bogleheads.org/wiki/Asset_allocation

The right investment products are total stock market, total international, and total bond. The sooner you can invest the better, as time is a powerful asset accumulation tool. A savings rate of 12%-15% is good. In the link above, notice that potential higher returns come with higher risk and higher losses. You have to find a balance that is comfortable.

Link to Getting Started

https://www.bogleheads.org/wiki/Getting_started


Paul

Re: Personal investment plans

Posted: Sun Sep 23, 2018 6:21 pm
by arcticpineapplecorp.
if your goal is retirement, there is an interesting blog post at mr. money mustache that shows how much to save to retire in a certain number of years (which assumes earning 5% after inflation during accumulation phase and withdrawal rate of 4% a year, though with flexibility during recessions):

http://www.mrmoneymustache.com/2012/01/ ... etirement/

welcome to the group!

Re: Personal investment plans

Posted: Sun Feb 10, 2019 5:59 am
by Learning101
Okie77 wrote:
Sun Sep 23, 2018 11:32 am
Keep it simple:

A good start is saving 15% of your total gross income. Increasing with raises, bonuses etc. As the years go by.
Thank you for this and sorry for the very late reply!

Re: Personal investment plans

Posted: Sun Feb 10, 2019 6:00 am
by Learning101
arcticpineapplecorp. wrote:
Sun Sep 23, 2018 6:21 pm
if your goal is retirement, there is an interesting blog post at mr. money mustache that shows how much to save to retire in a certain number of years (which assumes earning 5% after inflation during accumulation phase and withdrawal rate of 4% a year, though with flexibility during recessions):

http://www.mrmoneymustache.com/2012/01/ ... etirement/

welcome to the group!
Thank you much appreciated!

Re: Personal investment plans

Posted: Sun Feb 10, 2019 6:01 am
by Learning101
pkcrafter wrote:
Sun Sep 23, 2018 5:52 pm
Learning101 wrote:
Sun Sep 16, 2018 8:27 am
Dear all,

I am brand new on here so please forgive me if my question is amateur or even stupid to some of you. I am a huge fan of Jack Bogles books which I have to admit I stumbled across by chance after reading one of Tony Robbins books on wealth.

My question is can anyone advise me on a tool / resource to workout what how much I would need to save per year to achieve x in x amount of years please thus it would make it much easier to choose the right investment product in the first instance.
Here is info that will provide some perspective.

https://www.bogleheads.org/wiki/Asset_allocation

The right investment products are total stock market, total international, and total bond. The sooner you can invest the better, as time is a powerful asset accumulation tool. A savings rate of 12%-15% is good. In the link above, notice that potential higher returns come with higher risk and higher losses. You have to find a balance that is comfortable.

Link to Getting Started

https://www.bogleheads.org/wiki/Getting_started


Paul
Excellent thank you and sorry for the late response!

Re: EmergDoc's Investing Plan Thread [White Coat Investor]

Posted: Sat Apr 20, 2019 9:11 am
by Learning101
[Moved into this thread from: Re: EmergDoc's Investing Plan Thread --admin LadyGeek]

Dear all,

Thank you for the assistance so far which is much appreciated.

I have a few more basic questions if I may please:

1. When in-putting the rate of return into the excel function, how do you know what the rate of return actually is please? i,e I thought "past performance was not a reliable indicator?" or is just a an estimate?

2. Slightly off topic but I hope that I am ok to ask this please, is their any harm in mixing tailored made index funds with "do it yourself index funds"?
I am guessing a might get a response such as "why would you do this when having someone do it for you" but I thought I would put it out there.

Any advice much appreciated!

Thank you

Mark

Re: Personal investment plans

Posted: Sat Apr 20, 2019 10:00 am
by LadyGeek
Learning101 - In order to provide appropriate advice, it's best to keep all the information in one spot. I moved your post into your original question so we can focus on your situation.

2. A quick answer - "All-in-One" funds are great when you don't have the time or experience to handle the added complexity of "Do It Yourself" funds. There's nothing wrong with either approach.

If you need assistance with your portfolio, may I suggest you post your portfolio information in this thread using the Asking Portfolio Questions format? It will make you think about the "big picture" while giving us the information we need to point you in the right direction.

Re: Personal investment plans

Posted: Mon Apr 22, 2019 7:29 am
by Learning101
Thank you for the response and again please accept my apologises for posting in the wrong place which was unintentional.

Mark

Re: EmergDoc's Investing Plan Thread [White Coat Investor]

Posted: Mon Apr 22, 2019 7:31 am
by livesoft
Learning101 wrote:
Sat Apr 20, 2019 9:11 am
2. Slightly off topic but I hope that I am ok to ask this please, is their any harm in mixing tailored made index funds with "do it yourself index funds"?
What do you mean by "tailored made index funds"? Is that one of those things done by roboadvisers that do "direct investing" with 100 to 500 individual stocks. I hate such things because they trap people into sticking with that vendor and are too complicated to actually track to see if they are doing what they are supposed to be doing. That is, one just has to believe what the vendor tells them since they won't check and confirm things in detail themselves.

Re: Personal investment plans

Posted: Mon Apr 22, 2019 7:44 am
by Learning101
Hi,

Sorry for the confusion what I meant to say was Index trackers where the work is done for you but the polite lady on here prior to this post has answered that for me.

It was the first question I would really like some advice on please as I am struggling to know what the rate of return is on an investment when inputting these figures into Excel to create an investment policy.

If I just wanted to know the rate of return on depositing money into a bank account that's easy because they give you the rate of return but what I cannot get to grips with is what the rate of return is on different index tracker products.

Please forgive if this is a stupid question as I reasonably new to all this and finding me way albeit slowly!

Thanks