So, how was the year ? Gains made and Lessons learnt ?

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skor99
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So, how was the year ? Gains made and Lessons learnt ?

Post by skor99 » Fri Dec 29, 2017 9:00 pm

For me it was a good year overall, from a point of view of how my “balanced growth/limited risk” investments did, if not as much from a professional point of view. 3 or 4 more years like this and I can maybe dream of retirement , even somewhat early :-) having had a single income household for most of the time.
I do think professional satisfaction also plays a big part in a working person’s life till he or she is ready to give it up. That’s where I hope , I can do better this coming year, although I feel most of it is not within my control as I have to keep my nose to the grindstone and cannot take chances with a single income. I would like to get a sense of how others feel about the year as well as hear from other single income folks of how they deal with work stress etc. If anybody has managed to leave the safe path and take some risks being in the same situation, I would also appreciate pointers from them. Happy New Year to all !

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badbreath
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Re: So, how was the year ? Gains made and Lessons learnt ?

Post by badbreath » Fri Dec 29, 2017 9:32 pm

Don't think you are the only one on the board with a single income. My DW retired when she was laid off 5 years ago.

Anyway, this was the first year in more then 6 years that I had to rebalance in bonds due to the rise in stocks.
“While money can’t buy happiness, it certainly lets you choose your own form of misery.” Groucho Marx

skor99
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Re: So, how was the year ? Gains made and Lessons learnt ?

Post by skor99 » Fri Dec 29, 2017 9:40 pm

badbreath wrote:
Fri Dec 29, 2017 9:32 pm
Don't think you are the only one on the board with a single income. My DW retired when she was laid off 5 years ago.

Anyway, this was the first year in more then 6 years that I had to rebalance in bonds due to the rise in stocks.
In my case DW has been a homemaker pretty much all the time. By choice initially when kids were young and then due to lack of opportunities with the recession and lack of experience. In any case, we feel lucky and blessed to be where we are, just want to close out the last 8-10 yrs ( hopefully) of my work life in a strong manner

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Re: So, how was the year ? Gains made and Lessons learnt ?

Post by stimulacra » Fri Dec 29, 2017 9:44 pm

2017 was overall a pretty good year. Rate of return is looking to be around 18% and I've been moving towards 30% bond allocation in my retirement funds.

Main goal for 2018 is to treat my career like an investment portfolio. Going to do a complete reassessment and retread on some skillsets. Main decision fork is to whether invest some time and energy on some online or evening courses to make me more marketable in my field or focus that same time and energy on side hustles to increase cash flow. I do have one recently completed project that might become a “passive” income stream but it's another fire I would need to stoke and follow up with additional content installments in 2018.

akpataego
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Re: So, how was the year ? Gains made and Lessons learnt ?

Post by akpataego » Fri Dec 29, 2017 11:07 pm

2017 was really my first year investing and I have learned a lot.
If I could go back in time I would have maxed out my 401K. Already changed my allocation as of Dec1 so I am on track to max out next year.

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AtlasShrugged?
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Re: So, how was the year ? Gains made and Lessons learnt ?

Post by AtlasShrugged? » Sat Dec 30, 2017 9:27 am

I would like to get a sense of how others feel about the year as well as hear from other single income folks of how they deal with work stress etc. If anybody has managed to leave the safe path and take some risks being in the same situation, I would also appreciate pointers from them.
skor99....You pose an interesting, and somewhat broad question. The quantitative part: ~18% for the year. It was a good year. My cumulative CAGR remains well above 7%, which is what I have used for retirement planning purposes. I cannot believe it, but I am ahead of plan. So it was a good year, in this sense.

Your other question is really a qualitative one. What lessons have I learned (or re-learned).

One, your spouse really frickin matters. I am very fortunate here. I have a great partner (was stay at home Mom). Very wise. Good with money.

Two, in 2017, I finally 'got' that simplicity is where it is at. I have been a 'slicer and dicer' (REITs, Small cap, Mid-cap, etc), and then some untimely deaths of people I distantly knew made me think. If I die, my wife needs to manage what I leave behind and she is not investment savvy at all. So in 2018, I am dramatically simplifying 3-fund in Roth, a total market fund for her Roth, and a 4-fund in my 401K.

Three, in BigCorp where I work, we are undergoing a massive reorganization. For months, I have been concerned about where I would land (assuming I had a place). Things are becoming more clear now (after months of internal corporate turmoil), and it looks like I will be Ok. I learned that sometimes just doing nothing and letting things play out can be the smartest move. I told my staff to just 'do the job' and the rest will sort itself out. It was good advice. I did not tell my wife about the corporate crap until December - why worry her - I cannot change what will happen.

What I would tell you. Have a written ISP, and stay the course. Having a written ISP has been a Godsend.
“If you don't know, the thing to do is not to get scared, but to learn.”

MoonOrb
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Re: So, how was the year ? Gains made and Lessons learnt ?

Post by MoonOrb » Sat Dec 30, 2017 10:23 am

I can’t report that I learned anything new this year. All I did was stick to my ISP and continue to invest.

Investing is so interesting to me, because in some sense, I learned everything I needed to learn quite a few years ago and I could write it all down on the back of a cocktail napkin if I had to.

On the other hand, I’m always gathering and soaking new information, but unlike many other areas of life, there’s nothing to take action on.

One thing I do hope to learn more about moving forward is under what circumstances if any does it make sense to invest after tax income instead of plowing it all into pre tax vehicles.

My wife and I can contribute more than $100k annually to tax deferred plans and are unable currently max out all of this tax deferred space. As a consequence, one day we will have, comparatively, an enormous amount of money subject to RMDs and taxable at our marginal rates and not much that isn’t.

So, there is at least something else out there I need to understand. But, really, this year hasn’t taught me anything that’s changed my behaviors and I think that’s fine. I suspect most investors don’t learn the valuable lessons when the market goes up by 20%. You just learn to believe you’re a good investor because it’s impossible to not make money. Lessons from years that the market is down 20% may be more profound.

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Re: So, how was the year ? Gains made and Lessons learnt ?

Post by OmniaProPatria » Sat Dec 30, 2017 10:35 am

I've been investing steadily and aggressively for the past 15 years — ever since I graduated from college — and 2017 was when I first witnessed just how remarkable the power of compounding is. Thanks to continued investments throughout the year (of about 100k), market gains, and low cost mutual funds — my investments increased by ~$345,000 this year. I find that simply amazing! The lessons: investing early and steadily reaps incredible rewards down the line.

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Re: So, how was the year ? Gains made and Lessons learnt ?

Post by Dinosaur Dad » Sat Dec 30, 2017 10:45 am

A lot happened this year. Layoff in January from 20+ year corporate job at age 61, am still looking to get something else, but much harder than I thought. Beyond grateful that I'm frugal and I started investing early so I have options, including just packing it in (although I really feel I have a lot of gas still in the tank that I'd like to use). I knew intuitively that few people retire from corporations nowadays (we become too expensive, or you have new management who wants their own team, or whatever), but I didn't really plan on this. So a LOT of lessons learned in terms of thinking about your final phase before retirement, and doing a lot of planning well in advance. Advice to younger self: think in terms of setting yourself up so you're able to retire well before your "ideal" target date - you just don't know. And start to imagine what you want this next phase to include...that's something I had spent little time on.
"Take calculated risks - that is quite different from being rash." | General George S. Patton

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ruralavalon
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Re: So, how was the year ? Gains made and Lessons learnt ?

Post by ruralavalon » Sat Dec 30, 2017 10:57 am

Happy New Year.

skor99 wrote:
Fri Dec 29, 2017 9:00 pm
For me it was a good year overall, from a point of view of how my “balanced growth/limited risk” investments did, if not as much from a professional point of view. 3 or 4 more years like this and I can maybe dream of retirement , even somewhat early :-) having had a single income household for most of the time.
I do think professional satisfaction also plays a big part in a working person’s life till he or she is ready to give it up. That’s where I hope , I can do better this coming year, although I feel most of it is not within my control as I have to keep my nose to the grindstone and cannot take chances with a single income. I would like to get a sense of how others feel about the year as well as hear from other single income folks of how they deal with work stress etc. If anybody has managed to leave the safe path and take some risks being in the same situation, I would also appreciate pointers from them. Happy New Year to all !
We were a single income family, wife a stay at home mom, with four children through college with no student debt. The keys are to live modestly, keep your savings rate as high as you can comfortably sustain, contribute to your tax-advantaged accounts every pay period, and keep investing expenses low. Have a plan with a reasonable asset allocation, and stick to it. Those are the factors you can control. Don't try to use high risk investing strategies.

I almost always enjoyed my work, and even when less enjoyable I could never think of any different work I would rather do. I retired the year that I turned 66. To my surprise I was able to slow down the last few years, not taking on new projects, and taking off many Friday afternoons.

Now age 72, retired 7 years, asset allocation 50/50. Total return of 11.62% for 2017, withdrawal rate of 3.24% for 2017.
"Everything should be as simple as it is, but not simpler." - Albert Einstein | Wiki article link:Getting Started

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TomatoTomahto
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Re: So, how was the year ? Gains made and Lessons learnt ?

Post by TomatoTomahto » Sat Dec 30, 2017 11:39 am

All in all, 2017 was a great year:

- My daughter got her dream assignment in the Peace Corps, and is working with Fijian youth at risk.
- One of my sons got his dream job for after graduation, and will be graduating with a combined MS/BS in Computer Science after 4 years.
- Two of my other sons started "getting it together" in college.
- My wife and I made some, as yet to be divulged publicly, decisions that will affect our next 5 years or so. Roughly speaking, it's like the concept of a "staycation," but applied to retirement. I can't think of a clever word for it, nor a succinct way to describe it. I welcome suggestions.

Our returns were up 17.2% for the year.
2017 is when I got off the Asset Allocation train and onto the Liability Matching train. We have enough bonds and bond-like assets to last a lifetime of expenses. Everything else goes into equities (TSM, TISM, and PRIMECAP). We will figure out how to draw it down when the time comes; my wife is still working.

TravelforFun
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Re: So, how was the year ? Gains made and Lessons learnt ?

Post by TravelforFun » Sat Dec 30, 2017 12:00 pm

Our portfolio consisting of about 30% bonds is up 19%. Overall, It's been a great year. We traveled to China and Japan to see the cherry blossoms in the spring, Cancun to vacation with kids and grandkids in the summer, then France, Italy, Greece, and Croatia in the fall with friends.

Professionally, my part-time, three-day-a-week gig is still going strong and hopefully I can continue this for a few more years. I would strongly recommend this way of working to my cohort who are in mid 60s and no longer care about job titles.

Investment wise, I dipped in and out of GBTC and made a little profit in the process.

Financially, I just paid my 2017 property taxes and so I paid both 2016 and 2017 property taxes this year and that ensure I can itemize and file Schedule A on my 2017 tax return. This is probably the last year I can do that.

Let's hope 2018 will be equally great.

TravelforFun

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Jazztonight
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Re: So, how was the year ? Gains made and Lessons learnt ?

Post by Jazztonight » Sat Dec 30, 2017 12:12 pm

It was a challenging year financially for me as my Dad passed in March (96 yo, Alzheimers, it was his time) and I had to deal with distributing his funds to my sister and myself.

First I had to GET the #!@%* money from five financial institutions who were holding my father's accounts hostage, I guess just in case he decided to come back and claim it all! This was a difficult and trying time for me (just ask my DW), since patience is not my strong suit. I just soldiered on until everything was distributed. Lesson learned: no matter how careful you are in planning, there is another form to fill out, another hoop to jump through, another person who does not return your calls, another fee to pay, another document to have notarized. It was a nightmare--small, but a nightmare nevertheless.

Second, my DS (sister) gave me full control over distribution and allocation of the funds. Since I started putting her share in TSM, TISM, and a bond fund at Vanguard at the beginning of the year, she now thinks I am a financial genius, since she's made a small fortune on this investment (compared to the savings accounts and money market funds she'd had her own money invested in--but that's another story). Lesson learned: it's easier to invest money for yourself when you're a Boglehead and have a plan and have been careful to follow that plan for 20 years than it is to invest other people's money, knowing that if the market takes a dive they want to know where the heck their money went!

Finally, as the year comes to an end, I reflect (at 71) on how I'm financially comfortable, my city has new construction projects going on all over the place, the rich are getting richer, and every time I walk or drive under a freeway overpass I see people living in tents, surrounded by their belongings, shopping carts, trash, children's toys, and you-name-it. The divide between the haves and the have-nots continues to grow, and I feel pretty much helpless to do anything about it other than to donate food, goods, and funds to charity as best I can. Lessons learned: We don't live in a vacuum; we live in a complicated society. And we should count our blessings on a regular basis.

Wishing everyone a Happy, Healthy 2018!
"What does not destroy me, makes me stronger." Nietzsche

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cinghiale
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Re: So, how was the year ? Gains made and Lessons learnt ?

Post by cinghiale » Sat Dec 30, 2017 12:18 pm

I learned that it is very good fortune indeed to retire into two good market years. Expenses were high again this year, as our version of retirement included relocation and other transitional costs. Total portfolio this year was up 11%. Net portfolio appreciation, accounting for spending, was 8%. This with a “Wellesley Income” (35/60/5) asset allocation. If there’s a place where I can sign up for another such year in 2018, I’ll gladly do so.
"We don't see things as they are; we see them as we are." Anais Nin | | "Sometimes the first duty of intelligent men is the restatement of the obvious." George Orwell

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cinghiale
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Re: So, how was the year ? Gains made and Lessons learnt ?

Post by cinghiale » Sat Dec 30, 2017 12:30 pm

Jazztonight’s post came in while I was tapping away...^^^^^

Condolences on the passing of your Dad. No matter how old, and no matter what the circumstances, the loss of a parent hits hard. May 2018 be kind to you with fond memories.

I hope your sister remembers your “genius” when there’s a market drop... and when you are counseling her to stay the course.

Remembering the spirit of the season, I hope your final paragraph isn’t excised by a moderator. Not everyone who posts here is rolling in dough, but I would guess that most have “enough.” Scenes like one you describe provide vivid reminders that there’s much more to life than fund expense ratios. And that we should give daily thanks.
Last edited by cinghiale on Sat Dec 30, 2017 1:02 pm, edited 2 times in total.
"We don't see things as they are; we see them as we are." Anais Nin | | "Sometimes the first duty of intelligent men is the restatement of the obvious." George Orwell

Sockpuppet
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Re: So, how was the year ? Gains made and Lessons learnt ?

Post by Sockpuppet » Sat Dec 30, 2017 12:43 pm

Condolences to Jazz as well.

In happier news, I am up about 21% with Vangaurd Index Funds.

Big year. Got married and started contributing to my 401k and Roth. I know it’s a bull market, but amazing how quickly savings add up.

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JamesSFO
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Re: So, how was the year ? Gains made and Lessons learnt ?

Post by JamesSFO » Sat Dec 30, 2017 12:47 pm

I have a 70% (stock)/30% (bond) 3 fund portfolio with the stock 70 US/30 Intl. Up 17% for the year (inclusive of contributions which are hard to break out). Definitely a good year.

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Tycoon
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Re: So, how was the year ? Gains made and Lessons learnt ?

Post by Tycoon » Sat Dec 30, 2017 2:32 pm

It was a VERY good year. I learned that CG and DIV gains are going to hurt come tax time.
...I might be just beginning | I might be near the end. Enya | | C'est la vie

Sandi_k
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Re: So, how was the year ? Gains made and Lessons learnt ?

Post by Sandi_k » Sat Dec 30, 2017 3:17 pm

JamesSFO wrote:
Sat Dec 30, 2017 12:47 pm
I have a 70% (stock)/30% (bond) 3 fund portfolio with the stock 70 US/30 Intl. Up 17% for the year (inclusive of contributions which are hard to break out).
No, it's not hard to break out:

The formula to calculate your 2017 gains is this:

[EV - BV - Adds] / [BV + 1/2 Adds]

Where EV is the ending value of your account, BV is the Beginning Value, and Adds are your deposits to the account over this year.

vested1
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Re: So, how was the year ? Gains made and Lessons learnt ?

Post by vested1 » Sat Dec 30, 2017 3:33 pm

skor99 wrote:
Fri Dec 29, 2017 9:00 pm
For me it was a good year overall, from a point of view of how my “balanced growth/limited risk” investments did, if not as much from a professional point of view. 3 or 4 more years like this and I can maybe dream of retirement , even somewhat early :-) having had a single income household for most of the time.
I do think professional satisfaction also plays a big part in a working person’s life till he or she is ready to give it up. That’s where I hope , I can do better this coming year, although I feel most of it is not within my control as I have to keep my nose to the grindstone and cannot take chances with a single income. I would like to get a sense of how others feel about the year as well as hear from other single income folks of how they deal with work stress etc. If anybody has managed to leave the safe path and take some risks being in the same situation, I would also appreciate pointers from them. Happy New Year to all !
Not in the same situation, but, with a 60/40 AA in retirement in a 4 fund index portfolio slightly under 1 million, we gained $118,146 in 2017 with zero contributions. We withdrew 60k in 2017 though, using a variable withdrawal rate (VWR) while both delaying SS. 1st year of retirement (2016) we had a large purchase so our VWR was 8.83%, gain was 9.35%. Second year of retirement (2017) our VWR was 6.59%, gain was 12.96%. Next year (2018), with the onset of initial SS in July our VWR is forecast be 4.64%. From 2019 to 2023 our VWR is forecast to be 3.1%, excluding ROTH conversion, then RMD's only.

Many would consider our WR in the 1st 3 years of retirement as too risky, but the V in VWR left us an out. We have no illusions that 22.31% gain since retirement in 2016 was anything but luck. The reduced taxation of SS should provide additional spendable income starting next year. Reducing TIRA balance through withdrawals, and ROTH conversions up to the top of the 12% tax bracket should reduce RMD's as well. Income should continue to rise every year. We expect to be in the 22% tax bracket once RMD's begin at approximately 130k in income (with zero gain used in calculations). SS will be about 63k of that 130k, also with zero COLA. 30k is from a 100% survivor pension.

Lesson learned: Stick to our plan, it's working so far.

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Artsdoctor
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Re: So, how was the year ? Gains made and Lessons learnt ?

Post by Artsdoctor » Sat Dec 30, 2017 3:59 pm

Extremely active year with a tremendous number of challenges.

Certainly did not expect the market to provide the gains that it did.

I stuck with my investment plans that were set out long ago and did not veer. The outlined plans provided a sense of calm since I really didn't try to second-guess myself.

The forum here provided a wealth of support. I can't stand hypocrisy so if I'm going to offer advice, I have to heed it myself.

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David Jay
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Re: So, how was the year ? Gains made and Lessons learnt ?

Post by David Jay » Sat Dec 30, 2017 4:31 pm

The timing was great for me. I am taking equities "off the table" in preparation for retirement, so much of this past year's gains are locked in.

My plan is to hold all of our age 63 - 70 living expenses in bonds so my AA has moved about 10% per year each of the last 2 years (about 5% to go).
Prediction is very difficult, especially about the future - Niels Bohr | To get the "risk premium", you really do have to take the risk - nisiprius

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Re: So, how was the year ? Gains made and Lessons learnt ?

Post by ByThePond » Sat Dec 30, 2017 4:47 pm

2017 may have moved up my retirement date by a couple of years. Total portfolio is up over 250k, even as it dropped from 100% equities to 60%. DW commented that she never thought we'd HAVE that amount, much less gain it in one year.

Lessons learned? Having a reliable spouse is paramount to these results, as she manages the daily expenses masterfully & frugally. She's totally on board with our investing, even if she doesn't quite follow every detail.

Also heeding the advice to quit playing once you've won the game.

Thanks to all, and Happy New Year!

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unclescrooge
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Re: So, how was the year ? Gains made and Lessons learnt ?

Post by unclescrooge » Sat Dec 30, 2017 8:06 pm

2017 was a blast.

Welcomed my son into this world, completed a year-long renovation of a meth-house and moved in to a dream home, made made 22% return on my 80/20 portfolio.

getthatmarshmallow
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Re: So, how was the year ? Gains made and Lessons learnt ?

Post by getthatmarshmallow » Sat Dec 30, 2017 9:34 pm

A good year! Promotions for me and my better half, refinanced the mortgage to 15 year fixed, son (4) learned to read, daughter (1) learned to talk.

And in November I read Bogle's investing book and the Bogleheads investing book and finally took the plunge into index investing. The Bogleheads book was revelatory -- I realized that I was already the frugal person they described and I just didn't know how to invest. It turns out that proper investing is really very boring, and that I'm fortunate that part of my compensation was deferred and growing like mad these past few years.

A bit of a late bloomer (PhD late launch) but with a target and a plan I'm looking forward to 2018. I still have to decide whether we will work toward paying off the mortgage or invest (math says invest, spouse however will be on board more easily with killing the mortgage) but here's looking to another good year.

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Re: So, how was the year ? Gains made and Lessons learnt ?

Post by DVMResident » Sat Dec 30, 2017 9:36 pm

-Sold a 2-unit primary home turned full rental: market appreciation made the equity:rent no longer attractive. A good problem to have. We sold. Lesson learned: (1) I like being a landlord and I am very open to buying another property (when the RE market cools a bit) and (2) it's more emotional to sell a physical thing.

-Family health issues: a number of serious family health issues and a couple deaths. Lesson learned: the amount of time, resources, and emotional drain associated with them is huge. I overextended between work, family, and selling the rental. The only actionable lesson is don't overextend obligations (professional and family) to give room for the unexpected.

-Job: DW actually had two job offers: one with a lot of stress/long hours for double the salary of the second job with less hours. We decided for the lower stress/paying job. This was the first time in either of our lives we decided for the less ambitious career opportunity. Curious turning point in life.

-Related to above, kids are expensive. DW's salary barely break-even with taxes and daycare. No surprises or lessons learned. Just a "wow" moment.

-Secondarily, my megacorp job had a couple layoffs and I survived this round. I'm developing a tougher skin and preparing for a post-layoff sabbatical to see if FIRE is for me. I'm almost excited for a test FIRE sabbatical.

-21% gains on a 80/20 portfolio.

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Re: So, how was the year ? Gains made and Lessons learnt ?

Post by mindboggling » Sat Dec 30, 2017 11:19 pm

2017:

1. GF has metastatic cancer...she's holding steady.

2. I don't track investment returns, but it appears the market is up!

3. 2017 was my first full year of total retirement. I stopped working full-time in 2013, but returned to work almost immediately as a part-time daily-hire. Called it quits completely in December of 2016.

4. Sold a co-op apartment in an outer borough of NYC. Unfortunately, it was not my primary residence, so I will have to pay capital gains on it. I still have not invested the funds, so I am below my target asset allocation (30/70). I am dribbling money gradually into more equities.

5. Annuitized a Vanguard variable annuity that I contributed to for almost 20 years.

6. Established a donor-advised charitable fund through Vanguard.

7. Home improvements: new heating system, new Bilco door, close in garage that is not used.

Have a great 2018 everybody.

S
In broken mathematics, We estimate our prize, --Emily Dickinson

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JamesSFO
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Re: So, how was the year ? Gains made and Lessons learnt ?

Post by JamesSFO » Sun Dec 31, 2017 1:44 am

Sandi_k wrote:
Sat Dec 30, 2017 3:17 pm
No, it's not hard to break out....
I know the math, I literally do not have the contribution data available without combing through the accounts and I didn't feel like doing that. If you want to disregard my post as a result feel free to do so.

minimalistmarc
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Re: So, how was the year ? Gains made and Lessons learnt ?

Post by minimalistmarc » Sun Dec 31, 2017 5:46 am

Had our second child, now 5 months, wife and myself exhausted. Everything good investment wise. Work has been challenging but rewarding.

Here’s to a great 2018 to all Bogleheads!

ge1
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Re: So, how was the year ? Gains made and Lessons learnt ?

Post by ge1 » Sun Dec 31, 2017 6:18 am

After 20 years at MegaCorp I joined a small company, relocated the entire family to the Caribbean - and then we all relocated back due to the Hurricanes! I'm not complaining though, the new job allowed DW to give up her job and she is enjoying it and thankfully we kept the old house. The move actually made me appreciate our old neighborhood including friends that much more. At work I have an arrangement now with half remote work / half travel which works fine and I really enjoy what I'm doing.

Oh yes, and the market kept going up but I don't think I ever cared less about investing than this year.

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DaftInvestor
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Re: So, how was the year ? Gains made and Lessons learnt ?

Post by DaftInvestor » Sun Dec 31, 2017 7:19 am

We've been a single income family since my daughter was born more than 20 years ago. Sounds like the thought of it stresses you a bit perhaps because it is new to you. You get used to it (or at least I have). I am nor sure about what you mean by "can't take chances" - if you have a single income there might be some risks you might want to take to increase your income. You can't let the feeling of a single income hinder you too much.
It was a great year for us and more importantly we have greater things to look forward to here in the US in the year ahead!
(GDP is up, unemployment is down, growth is accelerating, market up, interest rates still low, etc.)
Happy New Year!

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tennisplyr
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Location: Sarasota, FL

Re: So, how was the year ? Gains made and Lessons learnt ?

Post by tennisplyr » Sun Dec 31, 2017 7:47 am

Downsized to FL from a HCOL area and love it! Banked a bunch of money while ongoing expenses are lower. Health is good as is the weather, off to play some tennis 🌞
Those who move forward with a happy spirit will find that things always work out.

KESP
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Joined: Sat May 07, 2016 8:24 pm

Re: So, how was the year ? Gains made and Lessons learnt ?

Post by KESP » Sun Dec 31, 2017 9:37 am

We are up 15% for the year. While we have an extremely modest portfolio compared to many on this forum, this is more money than I ever thought we’d have. DH pretty much lost everything in his divorce and while I saved, I could have saved a lot more. I’ve passed these lessons on to my children and they have been listening to me. Yay! I’m looking forward to retiring in 4 years. Because of this site and 403bwise, I successfully got a provider added to our school system that has low cost mutual fund options. Our only options prior to this was a very high cost variable annuity. Finally, the older I get, the more I believe if you have your health, you have everything. I’m exercising, eating primarily a plant based diet, and avoiding processed foods. Thanks to all of you who patiently give advice to those of us who still have a lot to learn!
:sharebeer

bgf
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Re: So, how was the year ? Gains made and Lessons learnt ?

Post by bgf » Sun Dec 31, 2017 9:38 am

great year for me. Total Portfolio had a 22.86% dollar-weighted IRR. outperformed my benchmark, VT, by 0.23%, and my portfolio has higher expenses. traded some call options for the first time this year.

obviously, with a year like that im feeling pretty good about everything.

who knows what next year will bring?
“TE OCCIDERE POSSUNT SED TE EDERE NON POSSUNT NEFAS EST"

bgf
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Re: So, how was the year ? Gains made and Lessons learnt ?

Post by bgf » Sun Dec 31, 2017 10:02 am

how are most people calculating returns including contributions? Kind of surprised at how high some of these are given bond allocations of 20-30%... VT total return was ~24%, but that assumes no contributions. contributions throughout the year would decrease that number, as VT rose consistently through the year. BND returned a whopping 3.7%...

i use XIRR and also a time weighted return formula. both showed 22.8%, and i have a <5% bond allocation and overweighted VWO compared to VT...
“TE OCCIDERE POSSUNT SED TE EDERE NON POSSUNT NEFAS EST"

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JamesSFO
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Re: So, how was the year ? Gains made and Lessons learnt ?

Post by JamesSFO » Sun Dec 31, 2017 10:29 am

bgf wrote:
Sun Dec 31, 2017 10:02 am
how are most people calculating returns including contributions? Kind of surprised at how high some of these are given bond allocations of 20-30%... VT total return was ~24%, but that assumes no contributions. contributions throughout the year would decrease that number, as VT rose consistently through the year. BND returned a whopping 3.7%...

i use XIRR and also a time weighted return formula. both showed 22.8%, and i have a <5% bond allocation and overweighted VWO compared to VT...
I pointed out in my post that I did not work out the contribution data and even if I had subtracted it out I would not have done the spreadsheet with XIRR. It really depends how closely you track in an tool how easy figuring it out is. I had my 2016 YE balance and this YE balance and did the math and made the comment in my post about the issue.

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JamesSFO
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Re: So, how was the year ? Gains made and Lessons learnt ?

Post by JamesSFO » Sun Dec 31, 2017 10:33 am

FWIW, I just decided to check Vanguard's "Personal Performance" page, they are computing a higher % increase even factoring contributions: 19.8% vs. 17% when I just compared balances (vanguard has most, but not all, of my funds) and again I'm 70% stock/30% bond and w/in stock 70/30 us/intl.

skor99
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Re: So, how was the year ? Gains made and Lessons learnt ?

Post by skor99 » Sun Dec 31, 2017 10:33 am

DaftInvestor wrote:
Sun Dec 31, 2017 7:19 am
We've been a single income family since my daughter was born more than 20 years ago. Sounds like the thought of it stresses you a bit perhaps because it is new to you. You get used to it (or at least I have). I am nor sure about what you mean by "can't take chances" - if you have a single income there might be some risks you might want to take to increase your income. You can't let the feeling of a single income hinder you too much.
It was a great year for us and more importantly we have greater things to look forward to here in the US in the year ahead!
(GDP is up, unemployment is down, growth is accelerating, market up, interest rates still low, etc.)
Happy New Year!
The risks somebody can take as a single earner can only be minimal as opposed to households with dual income. I can surely switch jobs if I find a decent one paying more in another company with decent benefits - somewhat of a risk as a new job always is, but not substantial if it is a big stable company. On the other hand, I cannot on a whim decide to quit and go into uncharted waters in new areas where I feel there might be very good future opportunities, but would be a big risk as well with no experience in those areas.

pennywise
Posts: 451
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Re: So, how was the year ? Gains made and Lessons learnt ?

Post by pennywise » Sun Dec 31, 2017 10:50 am

This year we bought a vacation/retirement home; it's been such a joyous experience that the retirement calendar consisting of 'guess we'll work a few more years till something happens' has become 'when can we get outta here and go down there forever'.

Financially we drew down the majority of our liquid resources to fund the house purchase, but OTOH our 403b accounts are following the market trends so we've amassed more in there than we ever dreamed of having. With that and the benefits of a longtime 2-income couple (2 pensions, 2 social security benefits, etc) retirement looks financially feasible any time.

Daughter finished graduate degree, found great job and moved to the city of her dreams. DIL got a promotion so son is able to crow that his plan for daddy daycare is well on track LOL. Very grateful that we didn't lose anyone we loved, and were able to gather a large extended family to celebrate our first Christmas in the new house. We got the best gift possible: happy memories of time together with those we treasure most in our lives.

Lessons learned include the importance of good planning and stewardship of finances-particularly with aging parents including one with dementia in assisted living, another still living on his own but starting to slip. I had a zero birthday and realized that if I don't get serious about exercise and moving more I"ll soon be dealing with health repercussions that could certainly derail an active retirement that is based on living ocean side. So that is my NY goal, along with putting some solid plans into place to structure that gauzy retirement dream into a reality.

Life is good and we are so blessed, I hope never to lose sight of that in the daily stress and grind.

bgf
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Re: So, how was the year ? Gains made and Lessons learnt ?

Post by bgf » Sun Dec 31, 2017 10:52 am

JamesSFO wrote:
Sun Dec 31, 2017 10:29 am
bgf wrote:
Sun Dec 31, 2017 10:02 am
how are most people calculating returns including contributions? Kind of surprised at how high some of these are given bond allocations of 20-30%... VT total return was ~24%, but that assumes no contributions. contributions throughout the year would decrease that number, as VT rose consistently through the year. BND returned a whopping 3.7%...

i use XIRR and also a time weighted return formula. both showed 22.8%, and i have a <5% bond allocation and overweighted VWO compared to VT...
I pointed out in my post that I did not work out the contribution data and even if I had subtracted it out I would not have done the spreadsheet with XIRR. It really depends how closely you track in an tool how easy figuring it out is. I had my 2016 YE balance and this YE balance and did the math and made the comment in my post about the issue.

FWIW, I just decided to check Vanguard's "Personal Performance" page, they are computing a higher % increase even factoring contributions: 19.8% vs. 17% when I just compared balances (vanguard has most, but not all, of my funds) and again I'm 70% stock/30% bond and w/in stock 70/30 us/intl.
sure, and it sounds like you clearly understand the level of estimation and effect of contributions/withdrawals on one's rate of return. before i started digging deeper into the time weighted/dollar weighted IRR, i really had no idea about how much discrepancy could pop up when comparing percentage returns... especially when comparing to one's portfolio to "market returns."

im surprised by your Vanguard performance number. I know my wife's TIAA cref account also provides a 'personal rate of return' but i have never tracked just that account to determine how accurate it is.

im sure on a site like this all these things have been discussed in detail in other areas.
“TE OCCIDERE POSSUNT SED TE EDERE NON POSSUNT NEFAS EST"

DrGoogle2017
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Re: So, how was the year ? Gains made and Lessons learnt ?

Post by DrGoogle2017 » Sun Dec 31, 2017 11:04 am

It was a good year overall. Both kids are financially independent and one got a 20% bonus for 2017. Nobody is seriously sick, everybody’s health is improving or got better, even my own sister’s health. She took some advice from me, taking turmeric and her feet are no longer swollen. Small step at a time to improve your health. The really good news over Xmas is that one of my kids got LASIK and she now can see 20/20, no more glasses or contact lens. It’s a wonderful feeling, brand new eyes.
And for us, we got a hang of retirement life, made money in the stock market, expense decreased, income went up slightly due to COLA. What more can you ask? Life is good.
Last edited by DrGoogle2017 on Sun Dec 31, 2017 11:35 am, edited 1 time in total.

2015
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Re: So, how was the year ? Gains made and Lessons learnt ?

Post by 2015 » Sun Dec 31, 2017 11:30 am

The single most important thing I learned this year was that I used to think successful men and women do what they have to do when they have to do it whether they feel like it or not (conversely, low performing men and women are always in "hair-on-fire mode" when it comes to project management as they only do what they have to do when they feel like doing it). Now my thinking has evolved to the idea that successful men and women do what they have to do far in advance of when they have to do it. I have found this to be a very subtle but powerful shift in producing superior results. Repeatedly this year, I have completed high impact financial/life projects that went smoothly and with a minimum of obstructions as a result of doing much prep work in advance.

I am also indebted to Cal Newport for his book Deep Work which greatly increased my efficiency and effectiveness in both time and project management.

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DaftInvestor
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Re: So, how was the year ? Gains made and Lessons learnt ?

Post by DaftInvestor » Sun Dec 31, 2017 12:46 pm

skor99 wrote:
Sun Dec 31, 2017 10:33 am
DaftInvestor wrote:
Sun Dec 31, 2017 7:19 am
We've been a single income family since my daughter was born more than 20 years ago. Sounds like the thought of it stresses you a bit perhaps because it is new to you. You get used to it (or at least I have). I am nor sure about what you mean by "can't take chances" - if you have a single income there might be some risks you might want to take to increase your income. You can't let the feeling of a single income hinder you too much.
It was a great year for us and more importantly we have greater things to look forward to here in the US in the year ahead!
(GDP is up, unemployment is down, growth is accelerating, market up, interest rates still low, etc.)
Happy New Year!
The risks somebody can take as a single earner can only be minimal as opposed to households with dual income. I can surely switch jobs if I find a decent one paying more in another company with decent benefits - somewhat of a risk as a new job always is, but not substantial if it is a big stable company. On the other hand, I cannot on a whim decide to quit and go into uncharted waters in new areas where I feel there might be very good future opportunities, but would be a big risk as well with no experience in those areas.
In my case having a stay-at-home-spouse offered me the greater flexibility to work more hours and take a job that required me to take more business trips. Knowing my kids were cared for (and in the primary case of my spouse) let me focus a bit more on maximizing my income over the years.

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TomatoTomahto
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Re: So, how was the year ? Gains made and Lessons learnt ?

Post by TomatoTomahto » Sun Dec 31, 2017 2:32 pm

DaftInvestor wrote:
Sun Dec 31, 2017 12:46 pm
skor99 wrote:
Sun Dec 31, 2017 10:33 am
DaftInvestor wrote:
Sun Dec 31, 2017 7:19 am
We've been a single income family since my daughter was born more than 20 years ago. Sounds like the thought of it stresses you a bit perhaps because it is new to you. You get used to it (or at least I have). I am nor sure about what you mean by "can't take chances" - if you have a single income there might be some risks you might want to take to increase your income. You can't let the feeling of a single income hinder you too much.
It was a great year for us and more importantly we have greater things to look forward to here in the US in the year ahead!
(GDP is up, unemployment is down, growth is accelerating, market up, interest rates still low, etc.)
Happy New Year!
The risks somebody can take as a single earner can only be minimal as opposed to households with dual income. I can surely switch jobs if I find a decent one paying more in another company with decent benefits - somewhat of a risk as a new job always is, but not substantial if it is a big stable company. On the other hand, I cannot on a whim decide to quit and go into uncharted waters in new areas where I feel there might be very good future opportunities, but would be a big risk as well with no experience in those areas.
In my case having a stay-at-home-spouse offered me the greater flexibility to work more hours and take a job that required me to take more business trips. Knowing my kids were cared for (and in the primary case of my spouse) let me focus a bit more on maximizing my income over the years.
+1000

When we first decided that, for a lot of reasons, I would be a SAHD, we figured that we could afford it, but we were far from having won the game. The freedom that my wife got from that enabled her to soar. She would probably have done well, regardless, but she no longer had to worry about the kids. Behind many successful women stands a loving and helpful man 😉

TwstdSista
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Re: So, how was the year ? Gains made and Lessons learnt ?

Post by TwstdSista » Sun Dec 31, 2017 3:00 pm

I haven't pulled our end of year numbers yet, although I know we are up.

But lesson learned -- Make a complete plan first, then implement it in full. (I started and then changed my mind several times, it was a mess). And stick with it.

In other words: create an IPS, implement your IPS, and follow your IPS.

Gnirk
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Location: Western Washington

Re: So, how was the year ? Gains made and Lessons learnt ?

Post by Gnirk » Sun Dec 31, 2017 3:42 pm

Gain about 8% with a 37/60/3 AA
1% WR
Lesson learned: I can actually spend some money on wants, not just needs.

ER2023
Posts: 51
Joined: Mon Jun 24, 2013 10:14 am

Re: So, how was the year ? Gains made and Lessons learnt ?

Post by ER2023 » Sun Dec 31, 2017 5:05 pm

Jazztonight wrote:
Sat Dec 30, 2017 12:12 pm
Finally, as the year comes to an end, I reflect (at 71) on how I'm financially comfortable, my city has new construction projects going on all over the place, the rich are getting richer, and every time I walk or drive under a freeway overpass I see people living in tents, surrounded by their belongings, shopping carts, trash, children's toys, and you-name-it. The divide between the haves and the have-nots continues to grow, and I feel pretty much helpless to do anything about it other than to donate food, goods, and funds to charity as best I can. Lessons learned: We don't live in a vacuum; we live in a complicated society. And we should count our blessings on a regular basis.

Wishing everyone a Happy, Healthy 2018!
+1

stimulacra
Posts: 221
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Location: Houston

Re: So, how was the year ? Gains made and Lessons learnt ?

Post by stimulacra » Sun Dec 31, 2017 6:02 pm

bgf wrote:
Sun Dec 31, 2017 10:02 am
how are most people calculating returns including contributions? Kind of surprised at how high some of these are given bond allocations of 20-30%... VT total return was ~24%, but that assumes no contributions. contributions throughout the year would decrease that number, as VT rose consistently through the year. BND returned a whopping 3.7%...

i use XIRR and also a time weighted return formula. both showed 22.8%, and i have a <5% bond allocation and overweighted VWO compared to VT...
Took gains and returns and divided that by beginning balance for Jan 1, 2017. Leaving out contributions made over the year might skew the returns a bit but not by much.

I still have a sizable amount of individual stocks and all of my international allocation is in emerging markets so that might be having an effect on returns as well.

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ruralavalon
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Re: So, how was the year ? Gains made and Lessons learnt ?

Post by ruralavalon » Sun Dec 31, 2017 6:26 pm

stimulacra wrote:
Sun Dec 31, 2017 6:02 pm
bgf wrote:
Sun Dec 31, 2017 10:02 am
how are most people calculating returns including contributions? Kind of surprised at how high some of these are given bond allocations of 20-30%... VT total return was ~24%, but that assumes no contributions. contributions throughout the year would decrease that number, as VT rose consistently through the year. BND returned a whopping 3.7%...

i use XIRR and also a time weighted return formula. both showed 22.8%, and i have a <5% bond allocation and overweighted VWO compared to VT...
Took gains and returns and divided that by beginning balance for Jan 1, 2017. Leaving out contributions made over the year might skew the returns a bit but not by much.

I still have a sizable amount of individual stocks and all of my international allocation is in emerging markets so that might be having an effect on returns as well.
Including contributions skews the result quite a bit for newer investors with smaller portfolios.

Excluding contributions is the correct way to measure gains from the investments.
"Everything should be as simple as it is, but not simpler." - Albert Einstein | Wiki article link:Getting Started

2015
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Re: So, how was the year ? Gains made and Lessons learnt ?

Post by 2015 » Sun Dec 31, 2017 7:31 pm

cinghiale wrote:
Sat Dec 30, 2017 12:18 pm
I learned that it is very good fortune indeed to retire into two good market years. Expenses were high again this year, as our version of retirement included relocation and other transitional costs. Total portfolio this year was up 11%. Net portfolio appreciation, accounting for spending, was 8%. This with a “Wellesley Income” (35/60/5) asset allocation. If there’s a place where I can sign up for another such year in 2018, I’ll gladly do so.
Yes, me too! I'm very much aware of how lucky I've been to have the wind at my back these past 2 1/2 years of what Otar refers to as the luck factor (with respect to sequence of returns).

Wishing all a happy, healthy, and prosperous 2018!

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