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Old 06-10-2015, 08:01 AM   #41
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Originally Posted by kaudrey View Post
Your asset allocation should be such that you are comfortable riding out any downturns. Equity investments should be for the long term, so if the market corrects tomorrow or next year or 5 years from now, you shouldn't care, because you shouldn't have to sell anything. You haven't lost until you sell.

If you are asking the question, then maybe your AA is too aggressive for your risk tolerance.

As I have for the past 20 years, we invest bi-weekly through my 401(k) and monthly in our Roths and taxable accounts.
I must admit that it is much easier to be sanguine when you have a paying job and you are LBYM's enough to invest bi-weekly through your 401K. However, once you retire, it turns into an IRA and now you are pulling money OUT of it. Makes downturns less "interesting". But you are absolutely right that this means that your allocations must allow a livable WR that gets one through the inevitable downturns.

Wild Bill shoulda taken more out of his IRA when he could have. . . .
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Old 06-10-2015, 09:51 PM   #42
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Originally Posted by daylatedollarshort View Post
John Bogle's predictions -


“When you factor in the costs associated with index funds, inflation, and taxes, you are actually looking at real returns of nominal to zero,” Bogle explained.....Although Bogle believes that the stock market is currently fully valued, he assured that he does not feel that investors should be running for the hills. “I don’t think we’re at the edge of some great cataclysmic crash, but anyone that invests should be prepared for a 25 to 30 percent decline because they do come along from time to time.”

This is interesting as 30 years TIPS are currently at 1.18% real.
But he was talking about the next 10 years, not the next 30.

Though I think your earlier mention of 'matching strategies' is worth consideration.


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Old 06-10-2015, 10:09 PM   #43
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Originally Posted by ERD50 View Post
But he was talking about the next 10 years, not the next 30.

Though I think your earlier mention of 'matching strategies' is worth consideration.

Good point. The ten year TIPS on the secondary market are at inflation + .59% today - relatively risk free, or worry free as Zvi Bodie would call it.

I like matching strategies. Bobcat2 has some great posts on Bogleheads on the topic.

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