just a general comment about "too conservative" investors here

[Valuethinker]

Quite a few comments that posters here are "too conservative".

Listen when we counsel many of the, often new, posters here, it's not because we are old fuddy duddies collecting our Social Security and talking about our glory days in the Luftwaffe together ...

It's because we have ourselves (the dot com boom and bust) or seen colleagues, friends, family members "invest" in all kinds of hot products, options, hot hand funds, the New New Thing (remember JDS Uniphase? Nortel? Blackberry?), gold, commodities, hedge funds etc. etc.

I knew a woman who put her (large) bonuses into Japanese warrants when those were all the rage ... lost 99% of her capital.

And take a lot of pain. And in some cases lose their homes, their marriages ... We've seen it. Sometimes we have personally lived it. They say there are no heroes among combat veterans - only green troops will do stupidly heroic things. The uninjured life of an infantryman in Northwest Europe 1944-45 was no longer than that of his counterpart in WW1 and the only way off the front line was either victory or severe injury & death.

I remember the small oil stocks boom of the late 70s. Dome Petroleum - nearly the largest bankruptcy in corporate history up to then. Gold? $1000 an ounce in 1980? Silver? 1987 and the great margin call of the October Crash? 2000-03 and the long slow dot com implosion - tech stocks trading for 1/10th of what they had trade to in 2000 (I think Amazon took 13 years to get back to its high, with no dividend; Yahoo never got there);

2008-09 and that sickening lurch downwards, watching your portfolios implode and the financial institutions that you dealt with every day just disappearing ...

Our caution, and our emphasis on plain vanilla stock-and-bond investing, comes from

1). seeing the new, the shiny, the exotic go phutt ... and taking people's lives with them. Once you lose that "play money", that capital, you lose all its future compound returns - that could have been generating 7% pa in stocks for another 30-50 years.

2). knowing that people who stuck to their knitting, balanced bond-equity portfolios, steadily investing & rebalancing, did alright. More than alright in fact.

[RNJ]

Yes, yes, and yes.

And it's only "play money" until it's gone.

[columbia]

golf

[mancich]

That felt very cathartic (but I agree with everything you said)

[DesertDiva]

...
Our caution, and our emphasis on plain vanilla stock-and-bond investing, comes from

1). seeing the new, the shiny, the exotic go phutt ... and taking people's lives with them. Once you lose that "play money", that capital, you lose all its future compound returns - that could have been generating 7% pa in stocks for another 30-50 years.

2). knowing that people who stuck to their knitting, balanced bond-equity portfolios, steadily investing & rebalancing, did alright. More than alright in fact.

Exactly. Great summary!

[ThrustVectoring]

So one of the under-appreciated things about optimization in general is that when you're near a maximum, the landscape is pretty flat. Small changes make relatively little difference. If you're not taking "enough" risk, or having "too little" international equity, or have less than 5% of your assets in gold, or whatever, it makes little practical difference.

Like, the "ideal" investment plan is to have all the money you know you won't need in low-cost stock index funds, at a high fraction of the Kelly Criterion in terms of leverage, with the rest in safe assets that you know you can access if you need it. That's the "correct" amount of risk to take - technically the full Kelly Criterion is "optimal", but with modeling uncertainty it's better to undershoot than overshoot it. If you're doing something that takes on at least 60% of that amount of risk, then in my opinion how much you save is going to matter a lot more than the exact allocation you choose.

[anonenigma]

You were in the Luftwaffe?

[JediMisty]

Well said.

[Valuethinker]

You were in the Luftwaffe?

https://en.wikipedia.org/wiki/Get_Smart

https://www.quotes.net/mquote/741631

Maxwell Smart and the KAOS agent agree to deceive his aunt & uncle, who has made a surprise visit:

Maxwell Smart:
Now I'm gonna have this gun in my pocket at all times, so you're gonna be completely covered. Now as far as my aunt and uncle are concerned, you and I are old army buddies, have you got that?

Victor:
Right. We flew together in the Luftwaffe.

https://en.wikipedia.org/wiki/List_of_G ... t_episodes

Can't eyeball which episode.

[Svensk Anga]

I hear ya.

My wife inherited a small sum in the mid 1980's. Had it been invested in VG's S&P500 fund this whole time, it would now be worth 28x the original amount. (VFINX from 1/22/1986, if you want to check. We weren't invested this way back then, but close. Started indexing substantially in the early 1990's.) It is NOT a small sum any more. When I think of all the flyers I took on individual stocks around the same time frame and think what they could be worth now, conservatively invested, I could kick myself. 28X!

[bloom2708]

This has been a test of the "Emergency Too Conservative Broadcast System".

Please return to your "trend following, individual stock, dividend reaching, high yield junk bond, small cap value, emerging market, 70% international, REIT in taxable, market timing, 100% stock, <insert your favorite here>" system.

[deltaneutral83]

OP is spot on and when people were losing it over a measly 20% reduction on the S&P by 12/24/2018 I knew the lessons of 10/17/2007-3/9/2009 had been forgotten or not observed in the first place. Not so much a big deal for people with 20 years to retirement and plenty of human capital but much more so of most retirees who were 80/20 and above. I honestly couldn't believe some of the topics started Christmas time. While the people out there who can stomach those situations with leverage (of any kind) are no doubt Bogleheads, the vast majority of us really need to use as little debt as possible in our daily lives. Again, kudos to those over the last 30-40 years that played the game well and didn't affect their sleeping patterns, but most of us can't do it.

[Dottie57]

Thank you Op.

I frequently feel out of placewith so many suggesting 100% stocks and mine is 50% stocks. I’veseen All the meltdowns too. Colleagues panicking. One bought a house without selling old one first. Then couldn’t sell ( think mortgage real estate dieting GR). He sold all of his stock options in that fiasco.

It can be disasterous to be over confident.

[HawkeyePierce]

I've never been through a bear market. I finished college in 2012—graduated right into a roaring bull market where my investments have (mostly) just gone up, up, up.

I can tell myself I won't panic when the market has its next crash. I can convince myself I'll have the stones to hold steady at 100% equities, but without having lived through a crash, how can I truly say how I'll react?

That's why I'm at 80/20 and have been strongly considering moving to 60/40.

What was it the Greeks taught us about hubris?

[Coinsinthefountain]

Great post! Thank you!

[nedsaid]

Quite a few comments that posters here are "too conservative".

Nedsaid: Markets are risky and if you have to err, err on the side of conservatism.

Listen when we counsel many of the, often new, posters here, it's not because we are old fuddy duddies collecting our Social Security and talking about our glory days in the Luftwaffe together …

Nedsaid: I am too young to have served in the Luftwaffe, the Korean War, or even Vietnam. The closest I came was buying a USS Missouri hat when the ship with in mothballs in Bremerton, Washington. I am young enough, to have served on the Missouri, as the Reagan Administration brought the great ship back, and its three sister ships, to active service. I never served in the military but wore the hat. One time I was pulled over by a State Trooper on the Interstate freeway. He saw my USS Missouri hat, addressed me as "Sir", and let me off with a warning. So it is a very mild case of stolen valor as the Trooper assumed I was a USS Missouri veteran. It was a case of a hat but no cattle, or no military service.

So no glory days to discuss over coffee. Just sit in the coffee shop and complain about the high property taxes. Kind of like the old saying about has-beens and never-weres. Sort of like my investing prowess. Cough. Cough.

It's because we have ourselves (the dot com boom and bust) or seen colleagues, friends, family members "invest" in all kinds of hot products, options, hot hand funds, the New New Thing (remember JDS Uniphase? Nortel? Blackberry?), gold, commodities, hedge funds etc. etc.

Nedsaid: I got burned when Lucent crashed, sold that and bought Nortel. I have felt the pain of falling star stocks and disappointing stocks bought at "bargain" but still very high prices in the early 2000's after that bear market. Hence the "Four Horsemen of Underperformance": AIG, GE, Microsoft, and Pfizer. Ford has replaced Microsoft in the "anti-index" and GE has earned the moniker of "Our Lady of Perpetual Disappointment." Yes, GE has never failed to disappoint since I bought it. But that is another story. The point is, I have gotten burned. AIG was another disaster.

I knew a woman who put her (large) bonuses into Japanese warrants when those were all the rage ... lost 99% of her capital.

Nedsaid: Fortunately, I only did the stupid things, not the really, really, really stupid things. Hopefully, I did learn a few things. Pretty much all I do here is confess my mistakes, errors, and investing sins here. Hopefully my sins are venial and not mortal. Also fun to interact with Larry Swedroe, who is never wrong about anything. As for myself, I am right about anything here only about every six months or so.

And take a lot of pain. And in some cases lose their homes, their marriages ... We've seen it. Sometimes we have personally lived it. They say there are no heroes among combat veterans - only green troops will do stupidly heroic things. The uninjured life of an infantryman in Northwest Europe 1944-45 was no longer than that of his counterpart in WW1 and the only way off the front line was either victory or severe injury & death.

Nedsaid: This is no laughing matter. I have talked to several people who lost investments, homes, jobs, and marriages due to the 2008-2009 financial crisis. A few folks never recovered, some sort of recovered, and many of us who were more conservative in our finances, recovered and then some. But the consequences of the crisis were real and quite painful. I can picture right now a couple whose marriage collapsed with the financial crisis.

I remember the small oil stocks boom of the late 70s. Dome Petroleum - nearly the largest bankruptcy in corporate history up to then. Gold? $1000 an ounce in 1980? Silver? 1987 and the great margin call of the October Crash? 2000-03 and the long slow dot com implosion - tech stocks trading for 1/10th of what they had trade to in 2000 (I think Amazon took 13 years to get back to its high, with no dividend; Yahoo never got there);

Nedsaid: I refused to chase the hot internet and high tech stocks during the 1990's. I owned stuff like Lucent and Nortel which crashed and burned and Hewlett Packard which I rode up and rode down again. But other that that, I didn't get carried away with the mania and my 80% stock/20% bonds and cash portfolio dropped from peak to trough about 32% during the 2000-2002 bear market.

2008-09 and that sickening lurch downwards, watching your portfolios implode and the financial institutions that you dealt with every day just disappearing …

Nedsaid: Yes, and I saw the horror of AIG dropping like a rock and nobody knowing why. My 75 shares turned into 3 shares and a warrant. Still own the stock, I think I own 12 and a fraction shares now.

Our caution, and our emphasis on plain vanilla stock-and-bond investing, comes from

1). seeing the new, the shiny, the exotic go phutt ... and taking people's lives with them. Once you lose that "play money", that capital, you lose all its future compound returns - that could have been generating 7% pa in stocks for another 30-50 years.

Nedsaid: One reason lots of folks here are wary of the Alternative investments. But at the same time, I have shown openness to new things. Bought the REIT fund when it became available and was an early adopter on TIPS. Also have become a fan of ETFs. Hard to knew which of the new stuff is good and what is just faddish.

2). knowing that people who stuck to their knitting, balanced bond-equity portfolios, steadily investing & rebalancing, did alright. More than alright in fact.

[AerialWombat]

deleted

[randomguy]

Quite a few comments that posters here are "too conservative".

Listen when we counsel many of the, often new, posters here, it's not because we are old fuddy duddies collecting our Social Security and talking about our glory days in the Luftwaffe together ...

It's because we have ourselves (the dot com boom and bust) or seen colleagues, friends, family members "invest" in all kinds of hot products, options, hot hand funds, the New New Thing (remember JDS Uniphase? Nortel? Blackberry?), gold, commodities, hedge funds etc. etc.

I knew a woman who put her (large) bonuses into Japanese warrants when those were all the rage ... lost 99% of her capital.

And of those examples, how many of them apply? Who on bogleheads is pushing hedge funds, single stock risk, options, warrants and so on. Maybe commodities where for a while sticking 5% in as a diversifier was talked about. The fact that it is possible to take on too much risk (anyone want to go 100% bitcoin:)) has nothing to do with the fact that you can take on too little risk. The lesson you should learn from Nortel and RIMM isn't that market risk is bad. It is that stock picking is hard so own everything. You will not make 10x in 5 years but you also will not lose 95% x in 5 years either:) With risk you need to figure out what the right amount is for you and when you should take it.

[alpine_boglehead]

Thanks, that's an excellent post at a good time (with stock prices high, cryptocurrencies on the rise again)

Warren Buffet: “Rule No. 1: Never lose money. Rule No. 2: Don’t forget rule No. 1”.
Me: “you can only win if you don't lose”

[zeal]

Great post, Valuethinker, and great follow-up from others. If I falter when I see my first "down" market, I'll come back to this thread as a reminder that buying-and-holding (and rebalancing) my three-fund portfolio is the right choice.

My favorites are #9 and #10.

[Artsdoctor]

Nicely put. I agree with everything you've said.

This has been a very, very long bull market and there are plenty of people who have forgotten the 2008-2009 meltdown (or simply did not live through it).

Your views are always very helpful and you're not obligated to do anything other than give an honest and straightforward opinion. If someone wants to weight heavily on the equity side, let them. There are plenty of bond lovers out there, including me, and there's no reason anyone has the defend their own asset allocation to anyone.

[Grt2bOutdoors]

Amen!
Just one more side comment - for those who think 3-6 months of expenses saved is enough “in case of emergency like a job loss”, you would best be served rethinking that especially since those who often offer up that advice have plenty more that is fully accessible in case of a prolonged situation or have a “secure” job situation or are “retired”. It always pays to think about where and from whom the advice is coming from before you drink the kool-aid.

I saw first hand people walking into offices in 2008 only to be walked out hours later, box in hand and that valuable stock they had in their accounts the day before turn to dust at the same time. Unemployed, no jobs in sight anywhere and worthless or near worthless investments. Think about that before you say “my portfolio is my emergency fund”. How far do you think they got on 3-6 months?

[Sandtrap]

Terrific write up!!
Should be in the WIKI somewhere.

Thanks for posting.
who's an old fuddy duddy ????

[Sandtrap]

Amen!
Just one more side comment - for those who think 3-6 months of expenses saved is enough “in case of emergency like a job loss”, you would best be served rethinking that especially since those who often offer up that advice have plenty more that is fully accessible in case of a prolonged situation or have a “secure” job situation or are “retired”. It always pays to think about where and from whom the advice is coming from before you drink the kool-aid.

I saw first hand people walking into offices in 2008 only to be walked out hours later, box in hand and that valuable stock they had in their accounts the day before turn to dust at the same time. Unemployed, no jobs in sight anywhere and worthless or near worthless investments. Think about that before you say “my portfolio is my emergency fund”. How far do you think they got on 3-6 months?

Absolutely well said.
And, the older the job seeker, and the more specialized the career, the longer the period of potential unemployment measured "in years".

[GerryL]

When I saw the title of this post, I thought it was going to be about people who have 20% or less of their portfolio in the stock market.

[EddyB]

This has been a test of the "Emergency Too Conservative Broadcast System".

Please return to your "trend following, individual stock, dividend reaching, high yield junk bond, small cap value, emerging market, 70% international, REIT in taxable, market timing, 100% stock, <insert your favorite here>" system.

Or less-than-30% international, since that’s just as far from market weight, right?

[yousha]

At 80 years of age, I have 75% in equities. Portfolio is $5.7 million. Doing exceptionally well.

[dogagility]

At 80 years of age, I have 75% in equities. Portfolio is $5.7 million. Doing exceptionally well.

Love your AA, Yousha! If I have any money to invest when I reach my eighties, that's the AA I'd like to have. (I won't have anywhere near your stash....).

[1210sda]

Great post, Valuethinker!!

My view is......How can anyone else possibly tell me that my portfolio is too aggressive or too conservative???

1210

[yousha]

At 80 years of age, I have 75% in equities. Portfolio is $5.7 million. Doing exceptionally well.

Love your AA, Yousha! If I have any money to invest when I reach my eighties, that's the AA I'd like to have. (I won't have anywhere near your stash....).

Well....keep healthy, exercise, no smoking, no booze (perhaps, on special occasions), be thrifty and above all get an informed accountant.

[Cody6136]

Quite a few comments that posters here are "too conservative".

Listen when we counsel many of the, often new, posters here, it's not because we are old fuddy duddies collecting our Social Security and talking about our glory days in the Luftwaffe together ...

It's because we have ourselves (the dot com boom and bust) or seen colleagues, friends, family members "invest" in all kinds of hot products, options, hot hand funds, the New New Thing (remember JDS Uniphase? Nortel? Blackberry?), gold, commodities, hedge funds etc. etc.

I knew a woman who put her (large) bonuses into Japanese warrants when those were all the rage ... lost 99% of her capital.

And take a lot of pain. And in some cases lose their homes, their marriages ... We've seen it. Sometimes we have personally lived it. They say there are no heroes among combat veterans - only green troops will do stupidly heroic things. The uninjured life of an infantryman in Northwest Europe 1944-45 was no longer than that of his counterpart in WW1 and the only way off the front line was either victory or severe injury & death.

I remember the small oil stocks boom of the late 70s. Dome Petroleum - nearly the largest bankruptcy in corporate history up to then. Gold? $1000 an ounce in 1980? Silver? 1987 and the great margin call of the October Crash? 2000-03 and the long slow dot com implosion - tech stocks trading for 1/10th of what they had trade to in 2000 (I think Amazon took 13 years to get back to its high, with no dividend; Yahoo never got there);

2008-09 and that sickening lurch downwards, watching your portfolios implode and the financial institutions that you dealt with every day just disappearing ...

Our caution, and our emphasis on plain vanilla stock-and-bond investing, comes from

1). seeing the new, the shiny, the exotic go phutt ... and taking people's lives with them. Once you lose that "play money", that capital, you lose all its future compound returns - that could have been generating 7% pa in stocks for another 30-50 years.

2). knowing that people who stuck to their knitting, balanced bond-equity portfolios, steadily investing & rebalancing, did alright. More than alright in fact.

"Although education is a fine thing, we would be well to remind ourselves from time to time that nothing worth knowing can actually be taught."

--Oscar Wilde

[Grt2bOutdoors]

At 80 years of age, I have 75% in equities. Portfolio is $5.7 million. Doing exceptionally well.

Within the realm of Graham's no less than 25% in bonds and no more than 75% in equities. The general comment refers to those who don't have upper 7 figure portfolios.

[willthrill81]

Part of the problem is that many investors believe that investing should be a thrilling adventure or at least want it to be that way.

That being said, I do believe that there is a strong contingent of folks here who are "recklessly conservative" in at least some aspects of their plans (e.g. 5 year emergency fund, 2% withdrawal rate).

"Although education is a fine thing, we would be well to remind ourselves from time to time that nothing worth knowing can actually be taught."

--Oscar Wilde

"Experience is an effective but cruel teacher, for it gives the test first and the lesson afterward."

[Grt2bOutdoors]

Part of the problem is that many investors believe that investing should be a thrilling adventure or at least want it to be that way.

That being said, I do believe that there is a strong contingent of folks here who are "recklessly conservative" in at least some aspects of their plans (e.g. 5 year emergency fund, 2% withdrawal rate).

"Although education is a fine thing, we would be well to remind ourselves from time to time that nothing worth knowing can actually be taught."

--Oscar Wilde

"Experience is an effective but cruel teacher, for it gives the test first and the lesson afterward."

+1!

[z3r0c00l]

I have every expectation that stocks will outperform bonds over 20 years. Just not willing to bet my entire economic future and retirement on it. Buying bonds so that future me will have food to eat, stocks so that he may eat well.

[Cody6136]

I have every expectation that stocks will outperform bonds over 20 years. Just not willing to bet my entire economic future and retirement on it. Buying bonds so that future me will have food to eat, stocks so that he may eat well.

LOVE IT!!

[Artsdoctor]

At 80 years of age, I have 75% in equities. Portfolio is $5.7 million. Doing exceptionally well.

At this point, you are investing for your heirs, not yourself (unless you're annual expenses are in the 10% range of your current portfolio . . . ).

[Vanguard Fan 1367]

You were in the Luftwaffe?

https://en.wikipedia.org/wiki/Get_Smart

https://www.quotes.net/mquote/741631

Maxwell Smart and the KAOS agent agree to deceive his aunt & uncle, who has made a surprise visit:

Maxwell Smart:
Now I'm gonna have this gun in my pocket at all times, so you're gonna be completely covered. Now as far as my aunt and uncle are concerned, you and I are old army buddies, have you got that?

Victor:
Right. We flew together in the Luftwaffe.

https://en.wikipedia.org/wiki/List_of_G ... t_episodes

Can't eyeball which episode.

I love Get Smart! Thanks for sharing the humor

[yousha]

At 80 years of age, I have 75% in equities. Portfolio is $5.7 million. Doing exceptionally well.

At this point, you are investing for your heirs, not yourself (unless you're annual expenses are in the 10% range of your current portfolio . . . ).

My expenses is significantly well below. I am investing because it is now a hobby and enjoyable. Yes... my heirs will inherit, however, it is not my purpose for investing. Hard to break the habit of investing since I was 19 years of age.

[corn18]

I may put a link to this post in every stupid thread that pops up on here. And there are a lot of them. Although I guess if only bogleheads posted here we wouldn't have much to talk about.

[whodidntante]

With the heaping piles of cash that some people here save, a conservative allocation is just fine. The forum won't ordain a retirement until the person is a multimillionaire in a reasonably priced state anyway. Too conservative isn't really for me to judge.

[Retired1809]

There are always exceptions but as a general rule, it's wise to remember the adage that volatility and risk (equities) are the friend of young investors in the accumulation phase while being downright toxic to folks in the de-cumulation phase who tend to lack recovery time.

That said, young investors who only invest in fixed income assets risk the perils and risks of inflation.

Stick with quality and always diversify.

[Nate79]

I agree that being more conservative is prudent. To me being conservative means:
1. Having a healthy emergency fund
2. Living debt free - can take out a mortgage but strive to pay it off
3. Live below your means
4. Hold some bonds. Age-10 or age -15 in bonds.

But I also believe that people can misjudge how conservative they actually are by having debt and still investing which is a balance sheet leverage. Debt as a negative bond means actual stock/bond ratio is more risky than perceived. I also do not have an issue holding alternative assets at ~10% max as a diversifier.

[MWONE]

At 80 years of age, I have 75% in equities. Portfolio is $5.7 million. Doing exceptionally well.

Within the realm of Graham's no less than 25% in bonds and no more than 75% in equities. The general comment refers to those who don't have upper 7 figure portfolios.

Amen......

[272 Sheep]

Great rant Op!
Quote I like is: "Good decisions come from experience...and experience mostly comes from from bad decisions.
(From restroom stall at "Airport Diner")
Carl W.

[9-5 Suited]

The forum won't ordain a retirement until the person is a multimillionaire in a reasonably priced state anyway.

Ha, so true. My reaction to most "can I retire?" posts is "sure, seems fine" and then inevitably multiple posters write essays about how retiring with only $1.25M is sure to lead to ruin.

[JoMoney]

The forum won't ordain a retirement until the person is a multimillionaire in a reasonably priced state anyway.

Ha, so true. My reaction to most "can I retire?" posts is "sure, seems fine" and then inevitably multiple posters write essays about how retiring with only $1.25M is sure to lead to ruin.

Differences in allocations and risk preferences are one thing, but when there's ridicule of the idea of someone living comfortably on $50k a year, or of a withdrawal rate that's less than someones (portfolio)/(life expectancy)... then it's beyond just being "too conservative"

[mcraepat9]

You were in the Luftwaffe?

https://en.wikipedia.org/wiki/Get_Smart

https://www.quotes.net/mquote/741631

Maxwell Smart and the KAOS agent agree to deceive his aunt & uncle, who has made a surprise visit:

Maxwell Smart:
Now I'm gonna have this gun in my pocket at all times, so you're gonna be completely covered. Now as far as my aunt and uncle are concerned, you and I are old army buddies, have you got that?

Victor:
Right. We flew together in the Luftwaffe.

https://en.wikipedia.org/wiki/List_of_G ... t_episodes

Can't eyeball which episode.

+1

[randomguy]

The forum won't ordain a retirement until the person is a multimillionaire in a reasonably priced state anyway.

Ha, so true. My reaction to most "can I retire?" posts is "sure, seems fine" and then inevitably multiple posters write essays about how retiring with only $1.25M is sure to lead to ruin.

Differences in allocations and risk preferences are one thing, but when there's ridicule of the idea of someone living comfortably on $50k a year, or of a withdrawal rate that's less than someones (portfolio)/(life expectancy)... then it's beyond just being "too conservative"

That isn't conservatism. That is an inability to project yourself into somebody else's shoes. If you have been living on 150k/year for 20 years, it is hard to imagine living on 50k. Needing 3 million dollars to live on 50k/year is "too conservative".

[Watty]

Quite a few comments that posters here are "too conservative".

Listen when we counsel many of the, often new, posters here, it's not because we are old fuddy duddies collecting our Social Security and talking about our glory days in the Luftwaffe together ...

It's because we have ourselves (the dot com boom and bust) or seen colleagues, friends, family members "invest" in all kinds of hot products, options, hot hand funds, the New New Thing (remember JDS Uniphase? Nortel? Blackberry?), gold, commodities, hedge funds etc. etc.

....

What you posted rings true but even though they are in a minority there are indeed many people that are too conservative here.

No you don't need a 2% safe withdrawal rate, yes you can afford a reasonable new car when you don't have a million dollar net worth, etc.

You need to find the "Goldilocks" balance that is just right and not be too conservative or too aggressive.