Originally Posted by wstu32
i have noticed that firecalc is the most "conservative"
am i correct on this or is firecalc pretty much "on"...
i would need no more than $60k per year....
opinions on firecalc vs other calcs and safe amount to earn 60k per year in conservative portfolio. once retired, i would not want too much exposure to risk.
Hey, the good news is that you're intimately familiar with interest-rate math. The bad news is that you're intimately familiar with interest-rate math.
FIRECalc's success ratio uses the worst markets we've ever seen and hopes that past is prologue. That's inherently conservative, but the Monte Carlo version might be even more conservative due to the way it mixes numbers without regard to trends.
Have you read Bernstein's five-part "Calculator from Hell"
series? Any calculator with a success ratio over 80% is telling you that you're polishing the cannonball.
You probably have a couple quantitative trends on your side that don't show up in the calculators. Most ERs experience declining spending, lower taxes, and the ability to shop for a good price. A number of recent studies have speculated, for different reasons, that a 4% SWR may be too conservative or that varying SWRs (like ESRBob's system) will handily smooth out bear-market bumps despite a higher overall SWR.
You gotta quantify that "too much exposure to risk" statement. Risk of inflation chewing up your 100% TIPS portfolio? Risk of downward volatility in your portfolio invested 100% in beaver cheeze commodity futures? ("Upward volatility" isn't considered a risk unless you've shorted the futures.) Risk of single-stock failure of your pink-sheet micro-cap emerging-market telecom company headquartered in the Bahamas? Risk of your insurance company going bankrupt after you've put your entire portfolio in one of their annuities? All of that "risk" can be moderated by diversifying among a couple different asset classes.
Originally Posted by wstu32
is anyone else out there as neurotic
as me in checking their assets? any thoughts on how i can stop doing this ....
Well, in the first place, is there anything wrong with checking every day? I'm in our Quicken files just about every day for one reason or another, and of course I'm going to download the latest portfolio numbers. On an up day I shout "Woo hoo!" and share my investing genius the good news with my spouse. On a not-so-good day I keep my mouth shut and find something else that needs my attention. On a really nasty day, maybe once or twice a year, I give her my "full disclosure" report and ask her when she's going on her next set of paid orders. It doesn't affect my thoughts or activities for more than a few minutes, and it certainly doesn't affect my sleep.
If it is affecting your morale then worry constructively. If you're worried about one particular asset then diversify away from it. If your worry is "just" fraught with a sense of impending doom then bury that website's bookmark deeper in your browser or take that software's icon off your desktop so that it doesn't catch your eye. Declare one day a month (or a quarter or even a year) as "look at the portfolio day" and find some other habitable activity to replace the day's routine. If you're worried about the future then educate yourself by reading every library book you can on investment returns, market trends, and asset allocation. Assuming you don't drop one of those tomes and crush your foot, you'll gain a sense of historical perspective that'll help you look past the short-term variations. (A good book, in both the historical & foot-crushing sense, is Dimson & Marsh's "Triumph of the Optimists" from the Hawaii library system.) Try to remain blissfully ignorant about it for the rest of the time.
You probably have a number of different way to reassure mortgage customers who are fretting that interest rates or real estate prices are too high for them to ever be able to afford their first purchase. Perhaps the logic behind those reassurances could be reworked and used on yourself to make you feel better about your portfolio's volatility.
Maybe the next time your portfolio goes up by four figures you should go longboard shopping. It takes a lot of effort to properly locate, acquire, equip, transport, position, and operate that type of investment too!