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View Poll Results: Investment choice
All Bonds 75 61.48%
All Stock 47 38.52%
Voters: 122. You may not vote on this poll

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Old 02-05-2011, 03:08 PM   #61
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I don't think so. The condition as set up by chinaco in the original post is Whatever amount that means in terms of actual dollars, which would vary with the age of the person taking the poll, and exactly what is meant by "ultra safe bonds", the condition set forth in the OP is that you have that much money. Thus, the choice offered is between the certainty of having enough, and the potential to have more than enough coupled with the risk of having less than enough.

I prefer certainty. I simply don't understand why anyone who had attained certainty of success on a greatly desired goal like ER would voluntarily risk losing it.
You're obviously reading comprehension challenged as well.
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Old 02-05-2011, 03:42 PM   #62
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You're obviously reading comprehension challenged as well.
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Old 02-05-2011, 04:07 PM   #63
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Your interpretation of the OP's intent seems to correspond to mine and I was told I have reading comprehension problems. You'd have to go back and read the thread again.
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Old 02-05-2011, 04:09 PM   #64
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Originally Posted by BTravlin View Post
You're obviously reading comprehension challenged as well.
Well, she left out the following sentence:

Quote:
All you need to do is keep up with inflation.
So, if "Ultra-safe Bonds" can't keep up with inflation, the whole premise is rather contradictory.

-ERD50
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Old 02-05-2011, 04:27 PM   #65
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I vote stocks because I like seeing my wealth constantly go up and down constantly like a yo yo. Also having 100% stocks gives me a good excuse to watch the hot babes and bald guys on CNBC and Fox Business.

Seriously my objections are similar to ERD and FD's and the prospect of high or even hyper inflation is real enough that I couldn't sleep nights with 100% bond portfolio.
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Old 02-05-2011, 05:00 PM   #66
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Well, she left out the following sentence:



So, if "Ultra-safe Bonds" can't keep up with inflation, the whole premise is rather contradictory.

-ERD50
I think the meaning of the poll depends on which phrase of chinaco's original description is given more weight: "All you need to do is keep up with inflation" or "you have the assets to do it. You have enough PV assets to live your current lifestyle for the rest of your natural life." To me, having "enough to live your current lifestyle for the rest of your natural life" includes keeping up with inflation. If you are losing ground to inflation, then the amount of money you have is less than what chinaco described.

Adding the phrase "all you need to do is keep up with inflation" could be taken to indicate a doubt about whether the 100% bonds portfolio is really able to keep up, but even so, I would take the bonds. If I had a big enough pile of money, I'd do so in the real world too.
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Old 02-05-2011, 05:49 PM   #67
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I would take the bonds. If I had a big enough pile of money, I'd do so in the real world too.
If I had a big enough pile of money, I'd take the stocks. As long as my portfolio was big enough that I could make my annual withdrawals even in severely down markets, I'd take the chance that there would be no end of the world scenario where equities all become value-less. Heck, in a situation where a diversified portfolio of world equities becomes worthless, bonds would probably default as well.
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Old 02-05-2011, 06:49 PM   #68
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OK, I have made up my mind. I'd go all stocks.

Up until now, I am one who employs Tactical Allocation, where my equity portion has been as high as 80%, and as low as 30%. But, if I have to chose one, then stocks it is. The reason? Same as the following.

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I vote stocks because I like seeing my wealth constantly go up and down constantly like a yo yo. Also having 100% stocks gives me a good excuse to watch the hot babes and bald guys on CNBC and Fox Business.
Yes, stocks going up and down adds spice to life. It may be a bit dull without that.

About the hot babes, I have eyes only for Melissa Francis with her big smile that warms my heart in the morning. I usually only watch a bit of CNBC in the morning as the market opens, and that is usually when Melissa makes her appearance. As to bald guys, well, I will save them for our female forum members (some of these guys are fairly beefy, and I am sure do have some sex appeal, but not for me).

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If I had a big enough pile of money, I'd take the stocks. As long as my portfolio was big enough that I could make my annual withdrawals even in severely down markets, I'd take the chance that there would be no end of the world scenario where equities all become value-less. Heck, in a situation where a diversified portfolio of world equities becomes worthless, bonds would probably default as well.
Ironically, I think that's why some of the rich people could become richer. Of course, we have seen some who bet the farm poorly and lost big, but usually they tend to get richer with time. At least that's the impression I have.
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Old 02-05-2011, 07:19 PM   #69
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Easy choice - #2 all stocks.

Real life - 52, retired 4 years, 100% stocks for many years
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Old 02-05-2011, 08:19 PM   #70
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If I say to you, the Steelers are "most likely" to win the Super Bowl tomorrow, would you take that as 100% certainty?
You can take it to the bank.

I voted bonds given the wording of the question. If you are able to FIRE, aren't you already rich? I would not want to risk not being able to FIRE.

In real life, perhaps bonds may keep you from successfully FIREing. Good point to debate.

Go Steelers!
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Old 02-05-2011, 08:40 PM   #71
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Within the parameters of the OP, I would take all stocks in the belief that "a little over inflation" is not enough to maintain my spending power over a time period that could be 50 years or more. The risk of below average or negative returns on an all stock portfolio is the lesser risk and, further, that risk is substantially reduced by the fact that it is below average returns in the early years that are the greatest risk. Given that the question was placed in the context FIREing, by definition if there are below average returns in the early years that risk can be dealt with by either or both of us going back to work (we will still be young enough).

This takes into account today's market conditions.

In the real world, I would have a mix of asset classes, cash or near cash to last a few years, a debt free home and would adjust asset class exposure in response to market conditions - but even with the freedom to chose, I would still rather hold a lot more stocks than bonds most of the time.
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Old 02-06-2011, 05:12 AM   #72
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.... I am heavily weighted in EQ (~75%)... -ERD50
OK. I see.... heh heh heh... one of the options didn't align with your tendency toward risk.

It's not all about you ERD50...

Believe it or not.. the poll was not put up to threaten your Psyche.

BTW - What do you see when you look at this image of an ink blot? >> [ink blot] [/ink blot]


The poll was artificially simple and binary for a reason. I wanted to see how members feel about risk when they stop working and begin spending their savings. What is more important... stable income or chance to make more. I could have stated it that way... but those two security classes are common representations of differences in risk/reward. People can relate to it.

Why did I do it? I see a lot of posts about the stock market... not much about bonds. I was curious about the population's tendencies. I am approaching FIRE and making decisions myself.



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Old 02-06-2011, 05:58 AM   #73
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I agree with this. I am already 100% bonds, munis, CDs, cash or equivalent.

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I prefer certainty. I simply don't understand why anyone who had attained certainty of success on a greatly desired goal like ER would voluntarily risk losing it.
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Old 02-06-2011, 09:00 AM   #74
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Of course, like most things in reality, it's not an either/or choice. But the answers are revealing and helpful.
Not sure how the answers are helpful, but the thread was entertaining.

There really should have been a third choice that covered all the other options like too anal, too reading comprehensive challenged, thinks its all about me, etc. I'd have voted for that one. If there had been a gun too my head and I had to make a choice, I'd have voted for stocks, but since there wasn't I did not vote.
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Old 02-06-2011, 10:35 AM   #75
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chinaco - A number of us pointed out the flaws and bias in the way you set the poll. It adds to the misunderstanding I see here of the relative safety of bonds versus stocks, which I don't think serves the community well. It isn't about me.

I never got personal, I stuck to the information as presented.

The fact that you turned this into a personal attack in post #72, and got snide in post#11 reveals much more about chinaco than any inkblot test would reveal about me.

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I am approaching FIRE and making decisions myself.
And yet, you totally ignore what FIRECALC has to show us about bonds versus stocks, even when tested through the Great Depression?

Good luck with your decision.

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Old 02-06-2011, 10:49 AM   #76
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I guess I'm an adventurous soul. I'm about to move across the country to a new job and several people have said that I'm "very brave". I don't get it. If you don't take a certain amount of risk, you shrivel up and die.
Hey Meadbh
Where are you moving and why?
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Old 02-06-2011, 11:51 AM   #77
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100% Stocks!

This is a no-brainer.... Bonds? Who needs bonds?

I don't see any reason to not go with stocks. There are many more stocks that act like bonds - relatively stable price, consistent income producers - than there are bonds that act like stocks - i.e. significant growth potential.

DW and I have been 100% stocks and fully invested for years. We are at a point of FI but we have not RE'd. Even when RE does occur we will be 100% stocks.

In my mind you can be 100% stocks and have a portion of you porfolio act like bonds if that floats your boat. Don't overlook the fact that bonds can have significant volatility and most are not guaranteed - just ask municipal bond holders of the past. Even today there are bonds that are in trouble. I guess you could go with all treasuries if you want a "guarantee" of the full faith of the government.
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Old 02-06-2011, 12:08 PM   #78
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No brainer for Miss Chicken Feathers ...Door number 1, all bonds according to these tight parameters.

In the real world, 40/60 AA.
Yup! capital preservation is more important than growth, albeit it is required to keep up with inflation. Our AA is similar.
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Old 02-06-2011, 02:47 PM   #79
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Erd50,
It is because you got hung up on the choice part bonds or stocks when the OP was asking about weather you would put your retirement at risk or increased income in retirement.

" What is more important... stable income or chance to make more."

That was what he was after, not how you go about it.
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Old 02-06-2011, 02:50 PM   #80
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Hey Meadbh
Where are you moving and why?
Keith

I have been trying to respond in a PM but it just won't work today despite my best efforts (see thread on Paging maintenance to Private Messages). I can PM everyone else with no problems. Could your mailbox be full?
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