Anyone here who has never had their retirement/investments/savings/401K in the stock market?
Our 401k has always been in no risk/low yield Fed bonds. Our life savings have always been in credit union CDs.
We have never had anything in Equities since FIRE, has worked out fine for us.
So far...
We have never had anything in Equities since FIRE, has worked out fine for us. A lot of members here will pooh pooh it and spout off about inflation, which in some cases is pertinent.
However, If your personal inflation rate is low, (Not some statistical CPI published rate, your OWN PERSONAL Rate), you live within your means and your fixed income return are reasonable and less than your withdrawal rate, I would sleep well and keep on trucking.
And they're off!
Different question than the masses.
I am into all the numbers and track all my expenses, but wondering just how easy it is to track personal inflation.
Example - if your internet/TV costs $100 in 2019 and goes up to $105 in 2020 with the same services, okay then 5%.
If it goes up to $120 in 2020 because one added HBO, then are you actually breaking down the $15 for HBO as budget creep from the $5 as purely inflation?
The way We do it.... We have tracked our expenses for about 12 years, 2 do not count as we were working and spent a lot more on stuff like Gas, clothes, etc.
So in the last 10 years it is simple, I look at what we spend 10 years ago, compare it with the other 9 years until now and take the average increase, decrease etc. In our case some of the big numbers such as RE Taxes, Insurance, etc. actually went down. E.g.: Our RE Taxes were $8k in 2008 and are $5.5k now, Car insurance was $1800 a year, it is $650 now as we went to 1 car (Remember this is personal inflation). Car leases are also down as money was cheap, that may change going forward. Home owners Insurance has also gone down. We have not moved so the numbers are good.
Yard maintenance, HOA, Cable, Electricity (Now on equal billing), and gas are also down a little. Maybe because we use less or have adjusted our subscriptions. Food and drink is up though, probably because we eat better food and drink better wine.
Okay so you don't track it down to the level of my previous example, so it is more of a net change without regard to increases/decreases in choices vs. just the inflationary aspects of existing choices.
Sounds good.
We have never had anything in Equities since FIRE, has worked out fine for us. A lot of members here will pooh pooh it and spout off about inflation, which in some cases is pertinent.
However, If your personal inflation rate is low, (Not some statistical CPI published rate, your OWN PERSONAL Rate), you live within your means and your fixed income return are reasonable and less than your withdrawal rate, I would sleep well and keep on trucking.
Anyone here who has never had their retirement/investments/savings/401K in the stock market?
Our 401k has always been in no risk/low yield Fed bonds. Our life savings have always been in credit union CDs.