deltaneutral83 wrote: ↑
Mon Sep 09, 2019 12:16 pm
TN_Boy wrote: ↑
Mon Sep 09, 2019 10:58 am
In the accumulation years, a 90/10 portfolio, while more aggressive than I like and non-diversified internationally, doesn't sound like a terrible plan. Beyond that context, the idea of a one-size fits all portfolio seems bad.
I have trouble believing Mr Buffett has a good grasp -- no matter his intentions or character -- of the right financial choices for people who are not ultra-wealthy.
I think Buffett is perfectly suited no matter the situation (lives in a reasonably sized home, eats at McDonalds, etc etc) to give financial planning advice, he just doesn't that often and people take what he says out of context. We have plenty of people here who are 100/0 with just a tad less than Mr. Buffett in the net worth column, so you cannot attribute those BH's to being out of touch and/or wealthy, so what would you attribute that towards? Seems the scapegoat of being wealthy in Buffett's case is being arbitrarily used.
Buffett only said 90/10 because it's simple and he couldn't care less about international. He'd be more than open to 60/40 just probably no international. There are also many "advisers" who encourage 100/0 at any age because they hope to get more AUM and there fore more compensation and some are broke themselves.
You said "He'd be more than open to 60/40 just probably no international."
Unless you sit in on those bridge games with Warren and Bill or have talked with Warren on the phone recently, I contend you have no idea what he would think of a 60/40 portfolio. In fact, this is the biggest problem I have with taking Buffett's suggestion -- he has thrown out this 90/10 recommendation in a couple of contexts, but there has been no back and forth with questions like "do you really mean 90/10 for everyone, are there any exceptions etc etc."
I'll reiterate: 90/10 S&P 500/US treasuries is a perfectly valid portfolio during accumulation for many people. It's not to my taste, especially near retirement, but I can see people choosing that mix.
But no, I do not understand how Buffett's opinion on personal finance should be taken as very useful. Obviously he understands investing. But I don't think he has spent much time pondering the financial issues of non-rich people, at least not in detail. Are his tax issues the same? If the stock market plummets 50 or 60%, will he be as concerned as the couple about to retire with a mere 300k in their 401k, invested 90% stock? Oh, retirement. Buffett is in his 80s. And not retired. So his retirement plan is not to retire. Which is very different from my retirement plan.
And a couple of your other comments ... sure some BHer's have a 100% stock allocation. What does that have to do with my post? And advisors encouraging people to be 100% stocks "because they hope to get more AUM"
. What does that have to do with anything? I thought we were talking about Buffett.
Incidentally, though he sold it last year, he did own a vacation home in Laguna Beach, CA for decades. It was an ocean view six bedroom house.
Buffett has a folksy and engaging style (I enjoy reading what he says and how he says it, but if you think he lives like you and I, or that his financial issues are similar you are sorely mistaken.