mathjak107
Give me a museum and I'll fill it. (Picasso) Give me a forum ...
- Joined
- Jul 27, 2005
- Messages
- 6,208
one of the issues we don't think about is that the returns we think we get and the money we should have by retirement is always looked at as pre-inflation.
it looks great when you look at these growth charts and see you will have over a million at retirement but if that is decades from now it is a different ball game.
throw in cagr average return values and when markets are down 50% and need to double to get back to where they are the compounded average returns work differently .
dr pfau ran some numbers looking at what we thought our compounding was vs what we really see.
dr pfau ran some numbers looking at what we thought our compounding was vs what we really see. in fact dr pfau found that 1.3 million dollars on the graph in todays dollars and with real world mathamatical forces may be 300k or so when saving 5k a year for 40 years at 8% average returns
very interesting paper as usual from dr pfau.
Retirement Researcher Blog: Compound Interest and Wealth Accumulation: It's Not As Easy as You Think
it looks great when you look at these growth charts and see you will have over a million at retirement but if that is decades from now it is a different ball game.
throw in cagr average return values and when markets are down 50% and need to double to get back to where they are the compounded average returns work differently .
dr pfau ran some numbers looking at what we thought our compounding was vs what we really see.
dr pfau ran some numbers looking at what we thought our compounding was vs what we really see. in fact dr pfau found that 1.3 million dollars on the graph in todays dollars and with real world mathamatical forces may be 300k or so when saving 5k a year for 40 years at 8% average returns
very interesting paper as usual from dr pfau.
Retirement Researcher Blog: Compound Interest and Wealth Accumulation: It's Not As Easy as You Think
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