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Y2K Retiree Update, Yikes!
Old 01-02-2009, 07:27 AM   #1
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Y2K Retiree Update, Yikes!

"In constant 2000 dollars the initial $1M portfolio has eroded to $382K and our retiree is now in a position of having to withdraw over 10% of that amount in order to keep living on a 4%/yr inflation-adjusted withdrawal rate. "

". . . . . But this is not the case for the hapless Y2K retiree who bought the safety argument for a stock-heavy S&P500-based portfolio in the heady days of the dawning of the new millenium. Clearly, this portfolio is in huge trouble and it would take a miracle to make it the full 30 years before failure. Hopefully our poor retiree can develop a taste for cat food in the near future. "

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Old 01-02-2009, 07:30 AM   #2
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Once again we learn that timing (or a taste for cat food) is everything.

Numbers is hard.

Retired in 2005 at age 58, no pension

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Old 01-02-2009, 07:31 AM   #3
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2000 is the new 1966.
"Hey, for every ten dollars, that's another hour that I have to be in the work place. That's an hour of my life. And my life is a very finite thing. I have only 'x' number of hours left before I'm dead. So how do I want to use these hours of my life? Do I want to use them just spending it on more crap and more stuff, or do I want to start getting a handle on it and using my life more intelligently?" -- Joe Dominguez (1938 - 1997)
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Old 01-02-2009, 08:43 AM   #4
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Spooky. I guess its increasingly clear that you ned more diversification than just S&P500 and t bills, eh? I always thought the trinity study portfolio was more about what it was easy to get data for rather than what any sensible person would invest in.

BTW, it is worth noting that the last 9 years differ from the 1966 on period in a very important way: at least as of yet, we have not experienced a large, sustained inflationary shock.
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Old 01-02-2009, 09:13 AM   #5
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Originally Posted by brewer12345 View Post
BTW, it is worth noting that the last 9 years differ from the 1966 on period in a very important way: at least as of yet, we have not experienced a large, sustained inflationary shock.
Gosh, didn't it take just about 8-9 years for that to happen in the 1966-1982 period too?

I guess our kid can take solace from knowing that 2014 (when she hypothetically enters the workforce) will be the new 1980...

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Old 01-02-2009, 12:52 PM   #6
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...and my cat has a taste for an occasional shrimp dinner. She may find herself working as a street performer, sitting between a rat and a rottweiler.
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Old 01-02-2009, 02:06 PM   #7
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How could anyone have known things would get this bad.

Consult with only myself as your adviser or representative. My thoughts should be construed as investment advice of the highest caliber. Past performance is but a pale shadow and guarantee of even greater results in the future.
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