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Old 09-01-2009, 05:32 PM   #41
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I thought the longer time between re balancing was interesting and I could see how that could work !
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Old 09-01-2009, 05:34 PM   #42
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I don't know about SPIA issuers defaulting, so I can't answer that. That is a concern that he discusses. He also talks about laddering SPIAs which is not something that I have seen before.

But I will say that perhaps because Otar is Canadian that he does not factor Social Security into the book at all. I think that one can consider Social Security a CPI-indexed annuity, so in some sense many US workers have some risk exported to the US government already. One would not include SS benefits into your assets, but if they provide a floor that covers most of your essential expenses, then your portfolio can probably have some fluctuation and still you would survive.
While he may be Canadian, he may have other reasons for ignoring SS.

Canada has CPP (which is a pension based on contributions), OAS (paid to all) and GIS (paid to the poor and old) which are similar to SS but probably smaller payouts. The last is means tested and the second partly depends on other income. Up here, there has been some question as to whether the govt will be fiscally politically able to continue these payments although CPP has been shown to be actuarily sound until about 2050?

Is SS really guarenteed? He may simply be taking a very conservative stance.
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Old 09-02-2009, 03:23 PM   #43
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This book sounds really interesting. I tried to download it. Not to hijack the thread but.....

I've always been suspicious of PayPal. Upon trying the download (after entering all my credit card and personal information), PayPal sent me a message saying my transaction could not go through, then proceeded to post $1.09 to the account. Mr. Otar had no record of my order (in any event $1.09 is not $3.99 and it didn't go to him), and was unwilling to be involved any further (can't really blame him for $3.99).

I'm not about to try again until the erroneous paypal temp authorization disappears from the account. Hopefully, I won't have to go to the bother of contesting it. Given PayPal's past record of security breaches, this doesn't give me a lot of confidence. At least it's a credit card and not a bank account.

As for why Otar may or may not include SS, CPP maxes out at about $10,000/year (contributions max out at around $40,000/year income), and OAS is around $6,000/year, but a "clawback" starts at about $65,000 annual income. It's my understanding that the system is on a much more solid footing than the US SS system.

So even if you are maxing both, you are receiving somewhat less than someone maxing US SS. If you qualify for the GIS, you probably aren't having a comfortable retirement anyway....
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Old 09-03-2009, 01:46 PM   #44
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When I run some numbers through Otar's calculator it only allows a 2.6% SWR, where Firecalc allows 3.1% for a 50/50 portfolio for 50 years.

Wonder what the difference is?
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Old 09-03-2009, 01:56 PM   #45
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When I run some numbers through Otar's calculator it only allows a 2.6% SWR, where Firecalc allows 3.1% for a 50/50 portfolio for 50 years.

Wonder what the difference is?
0.5%

Kidding aside, it has to be in the assumptions Otar makes in his calculations. FIRECalc is based on history, Otar's calculator is based on
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Old 09-03-2009, 03:33 PM   #46
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0.5%

Kidding aside, it has to be in the assumptions Otar makes in his calculations. FIRECalc is based on history, Otar's calculator is based on
Otar claims his is based on history, too.

Cardude: Without seeing both completed forms it is hard to say, but what duration of retirement do you have on each?
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Old 09-03-2009, 07:59 PM   #47
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When I run some numbers through Otar's calculator it only allows a 2.6% SWR, where Firecalc allows 3.1% for a 50/50 portfolio for 50 years.

Wonder what the difference is?
Recall that FIRECALC can't complete a 50 year sequence with data after 1958 (it wont have 50 years in it). Maybe Otar filled in those years with ? ... something?

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Old 09-03-2009, 08:43 PM   #48
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I am about half way through this tome, and I like it.

His insights into the differences in behavior between a growing pool of assets and a drawn-upon pool (distribution) are very revealing. I thought I understood this but he points out a lot of misinterpretaitons (on my part).
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Old 09-03-2009, 08:54 PM   #49
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I haven't read the book yet, and am eager to see Otar's techniques for assuring the risk I "exported" to the insurance company when I bought the SPIA doesn't get re-sent back to me COD when the company can't keep its promises. There may be a lot of that going around in the future.
Amongst all the fun and games over the past two years, I think that it is worth noting that there really has not been a life insurer failure where the policyholders were impaired. Contrast that to the number of other types of financial firms that fell over. Not to say we won't see insurers blow up, but if they did not do so through what we just experienced, I cannot help but feel some confidence that the bigger and stronger firms (especially the mutuals) are a pretty good risk. So I would not put all my eggs in one basket, but I could get comfy with a chunk of assets at one or more well-chosen insurers.
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Old 09-04-2009, 03:43 AM   #50
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I'm sure the book is interesting, but I will not be reading it. After attempting to go through PayPal twice, with 2 different credit cards, it bombed both times. It could be my ISP, but I've had no problems with other online orders or downloads. I emailed Mr. Otar a couple of times in order to verify where the break in the link was, since PayPal had placed temporary authorizations on both accounts. After receiving his arrogant and insulting response, I wouldn't give him a nickel.

A portion of my last response from him (and I wasn't badgering him or abusive in any way, rather polite and just trying to figure out what the problem was) is quoted below:

"I just want to point out that my book is heavy in math, charts and tables.
It has complicated formulas and strategies. It is meant for advisors and
people accustomed to financial planning. It may not be suitable for you. I
will not be able to answer any questions or provide any type of consulting.
What I am trying to say -as politely as I can- if making a $3.99 payment is
so complicated for you and for me, perhaps it is better that you borrow the
book from the local library when it becomes available, before you waste more
of your time and money, and mine too.
"

I was pretty astounded at what I consider to be a very rude response under the circumstances. After thinking it over most of the day (and, yes, fuming), here was my final communication to him:

"Your condescending implication that somehow the problem here is related
to my intellectual capacity, however 'politely' you may feel you phrased
it, is not appreciated. I have been conducting my business online,
successfully, for at least 10 years. I have B.S. and M.S. degrees in
structural engineering, a B.A. in philosophy, and a long and successful
career as a structural engineer. Although not a professional financial
planner, I am well-versed in the subject and am pretty sure I can
comprehend any 'higher mathematics' you may have included in your book.

My communications to you were to enlist your help in solving a vexing
problem, and to determine whether the problem was with your website, my
ISP, or that of PayPal (your payment processor). Your last response,
which can only be characterized as 'arrogant' does not speak well of
you. I have no further need to communicate with you.

Finally, if you feel that providing customer service for your product is
a waste of your time, even if only $3.99 is at stake, then perhaps
you should look somewhere besides the service sector for your
profession. Hire someone else to handle your sales, or go back to
engineering.
"
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Old 09-04-2009, 06:47 AM   #51
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Wow. What a jerk. I feel like emailing him some stupid questions just to piss him off now.............

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Old 09-04-2009, 07:44 AM   #52
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Makes me feel like returning the "book" to him and demanding my money back. What an arrogant reply. I will never understand how or why some people would choose to treat others that way.

... but the book is one of the best I've read on the topic. Even I can follow the algebra .
.
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Old 09-04-2009, 08:32 AM   #53
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... Hire someone else to handle your sales, or go back to engineering.
Even from the "engineering viewpoint", if one customer had problems with the transaction, it is likely that others may be experiencing problems, and they may not have taken the time to report the problem. I'd bet that some Probability and Statistics could be (and has been) applied to the situation of "reported problems" versus "total actual problems"

He should be thanking you for the feedback, not claiming you are "wasting his time".


Hmmm, I was gonna buy the book, not so motivated now. Responses like his are what fuel some "rationalizations" among the "pirates". Looks like it might be easier to steal it than to buy it (though I would never condone such action).

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Old 09-04-2009, 09:03 AM   #54
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Software does not always work as designed or intended. Anyone involved in any kind of public facing software, website, payment system or accounting should know that and be prepared to deal with it. With an ebook the incremental cost per copy is as close to zero as practical, so the obvious customer service response should be "Sorry you had trouble. Here's the copy you tried to order." Then the situation can be investigated or ignored as an isolated incident until other reports confirm it. Customer gets some satisfaction. Minimal time is "wasted" if problem really is difficult to track down.

I for one was so interested in this book because of the positive responses from others who seem to have a high opinion of Mr Otar and his analytic abilities. After learning about this maybe I am not so accepting. All systems (software is just an example) can and do occasionally behave unexpectedly. I assume this includes financial systems, monetary systems and even my own retirement plans. A rigorous analysis which makes no provision for, or even acknowledges the possibility of, unexpected events may still be useful, but I will view it skeptically.
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Old 09-04-2009, 09:34 AM   #55
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Bosco, his response to you was sooooo wrong in so many ways.

Even if some people were just too dumb (as Barbie said: "Math is hard!") to understand his book, maybe they were ordering it for someone else.

Maybe lots of people have tried to order it and can't get through the broken link and just don't care enough to pursue it.

Maybe he used "broken links" in reaching his conclusions in the book.

Perhaps he is lurking and reading this thread and can see what his poorly worded response to you has wrought in the previously positive take on his work.
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Old 09-04-2009, 11:22 AM   #56
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When I run some numbers through Otar's calculator it only allows a 2.6% SWR, where Firecalc allows 3.1% for a 50/50 portfolio for 50 years.
Wonder what the difference is?
I haven't run the calculator yet, but most of his book assumes what we Americans would think of as staggeringly high expense ratios of 2%. I wonder if that's the difference.

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Bosco, his response to you was sooooo wrong in so many ways.
Perhaps he is lurking and reading this thread and can see what his poorly worded response to you has wrought in the previously positive take on his work.
Perhaps we've only seen one side of the story...

Anyone else heard from Otar or had problems with PayPal? I'm off to the Bogleheads to read their thread.
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Old 09-04-2009, 11:54 AM   #57
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Well, I prefaced both my earlier communications with an apology to take up his time over $3.99, but I really needed to find out how far the transaction(s) had proceeded before I attempted to take any action.

The first time I ordered the book, I used a Canadian credit card and my Canadian address (since he's Canadian, I figured it would be simpler). Paypal put a temp. authorization of $1.09 on that account (I assume $1.00 US with exchange).

The second time, I thought it would be simpler to try a US card and US address, since Paypal seemed intent on a US transaction. Different error message, but same result--$1.00 temp auth.

I honestly thought this was info he needed, and didn't know how proceed without contacting him anyway. Paypal has no phone number or email listed, and my only other recourse was to cancel the charge through the credit card company. But I can't do that until it is permanently posted.

So I thought he could let me know what he knew, if anything, about the transactions since I'd need that info to dispute any charges anyway. Wow--I was flabbergasted at his last response.
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Old 09-04-2009, 11:58 AM   #58
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In the first response he sent back to me, part of what he said was

"So, I have no clue what you paid to whom for what. In either case, if you were to pay Retirementoptimizer, i.e. if you had pushed one of the buttons on my website, the amount would not be $1.09 in any case."

Only problem was (as I assured him), I DID push the button on his website (sheesh!!).

So my first theory was that somehow, because at the present time, my IP was from a US domain, Paypal wanted to charge US funds (jeez, sometimes living in 2 countries can be complicated).

That's why I thought I'd try a US card, but that didn't work any better.

So looking back, even the initial response from him after the first problem sort of had the implication that I was an idiot. I just didn't read it that way because I try to give people the benefit of the doubt and I do understand that for $3.99 he doesn't want to spend a lot of time. But like I said in my last email, maybe he should hire someone.
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Old 09-04-2009, 02:31 PM   #59
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Wow Bosco. That was an unbelievable response you got. Thanks for posting.
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Old 09-04-2009, 02:58 PM   #60
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I

Perhaps we've only seen one side of the story...

Anyone else heard from Otar or had problems with PayPal? I'm off to the Bogleheads to read their thread.

I had a problem . I started the download and then my computer just shut down ( We had been having signal problems ) . I rebooted it and the download was lost in space so I emailed him ,explained the problem and asked for another link . He sent it pretty quickly with no message only the new link which I used and it downloaded without a problem .
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