should I change investment strategy?

[HsiaoChu]

Managed funds, not managed funds, its all the market which any downturn in the economy can take your principle and turn it to mush. When you are 10-15 years before the projected date of your retirement, you take 85-90% of your stock market stuff, and you put them in CD's or Treasuries.

You do not have time to make them back if the whole market crashes or your little piece of it tanks. I have too many friends who didn't follow this little rule 3 years ago they were going to retire with me. Now they are retiring when they have to which is age 70.

Every investment for retirement book anywhere says that. Any competent money manager or CFP will do that for you, or you do it for yourself.

 

[LOL!]

You do not have time to make them back if the whole market crashes or your little piece of it tanks. I have too many friends who didn't follow this little rule 3 years ago they were going to retire with me. Now they are retiring when they have to which is age 70.

This doesn't make any sense at all based on the data. We have see that a reasonable portfolio of stocks & bonds has recovered (where reasonable is anywhere from 30% to 70% stocks) to where it was in 2007 especially if you add in 3 years of contributions and forego 3 years of withdrawals. That is, someone retiring today should be as well off as someone retiring 3 years ago.

I can only conclude that you retired at age 67.

There is no need to take 85-90% of your stock market stuff and put them in CD's or Treasuries. One can do that, of course, but there is no need.

 

[DblDoc]

It is rather interesting to me that one does not find internet forums where early retired folks are writing about all their successes with actively-managed funds. Nor do you find a forum of fanatics devoted to Mr Johnson of Fidelity because he has made them wealthy. If actively-managed funds are so great, where ARE all the folks who have reached their dreams with them and want to proselytize about them? Where DO you find them?

At internet forum sites dedicated to active fund managers...

DD

 

[FinanceDude]

At internet forum sites dedicated to active fund managers...

DD

Yet Fidelity is the 3rd largest fund family in the world, after Vanguard and American Funds...........

 

[Nords]

If actively-managed funds are so great, where ARE all the folks who have reached their dreams with them and want to proselytize about them? Where DO you find them?

I don't even follow the genre anymore, but:
Bob's Mutual Fund Rating Page
FundVision - Home Page
FundAlarm-Updated 1st of Each Month
Fidelity Family
HandsOn
Options and Derivatives
Income & Dividend Investing
Oakmark Funds

and one who ER'd:
Amazon.com: How I Trade for a Living (Wiley Online Trading for a Living) (9780471355144): Gary Smith: Books

 

[haha]

It is rather interesting to me that one does not find internet forums where early retired folks are writing about all their successes with actively-managed funds. Nor do you find a forum of fanatics devoted to Mr Johnson of Fidelity because he has made them wealthy. If actively-managed funds are so great, where ARE all the folks who have reached their dreams with them and want to proselytize about them? Where DO you find them?

Often proselytizing is inversely proportional to results. See the famous natural experiments in social psychology where some group forms around a guru to await the end of the world. Often they sell their homes and their goods, leave their spouses and take other very definite actions in anticipation of the end of the world.

When the end doesn't some, do they hurry home and try to rebuild their lives?

Usually not. They often redouble their fervor and proselytizing, in a desperate effort to get social confirmation of their core belief, which when examined doesn't really stand up that well.

So that answers your question of where are the acolytes of non-Bogle approaches. They have no motivation to seek social confirmation, as they get confirmation from their statements and their everyday lives. I do agree that if a person has no interest or talent for choosing investments and planning his strategy, then the unvarying asset allocation method may be best. But why assume that all people are in this category?

As best I remember, I have never bought an index fund, and damn few funds of any description. I have been retired over 25 years, and I started with a laughably high WR and two young children and a non-working wife. I raised the kids to where one of them is now wealthy and the other has a high paying job, and I survived an expensive divorce settlement. While I am certainly not rich by my standards, I am also OK and do not expect to have to do unpleasant things like move to an unappealing but cheaper location.

Do I need some 'heads to confirm what is obvious from the entire experience of my life?

Actually, the secret of the approach favored by this board, the 'heads, etc, is not that it presents excellent investment results, but that this is a group of very self denying people with enormous ability to defer gratification, and very low psychic discount rates. Many even forgo having children at least partially because they cost a lot. If they didn't eventually get fairly well off it would be shocking. These folks would likely do fine just stuffing money into a mattress. Few outsiders would believe the raw savings ability of our group.

The "secret" is extreme frugality, and that equities have gone from very undervalued in the 1980s to moderately overvalued now. This is unlikely to happen again, from these levels.

The game continues.

Ha

 

[Darryl]

this is a group of very self denying people with enormous ability to defer gratification, and very low psychic discount rates. Many even forgo having children at least partially because they cost a lot. If they didn't eventually get fairly well off it would be shocking. These folks would likely do fine just stuffing money into a mattress. Few outsiders would believe the raw savings ability of our group.


The game continues.

Ha

Ha, fine piece of writing. Yes we have a very determined group.

 

[ERD50]

haha, I don't think people are saying that an individual cannot do well with individual stocks or picking their own funds. I personally think it is somewhat unlikely (by 'better' I mean risk-adjusted), and I've pretty much given up on it myself, but that certainly doesn't mean it can't be done. You appear to be one data point to support that it can. You may be the minority, but I'm sure you are not alone.

However, I think most of us are saying that it is *really* unlikely that you can pick some manager and pay expenses, and end up better off. Yes, there is a fair amount of 'group think' on this forum, but I tend to think there is some basis for it when it comes to this subject. One must allow for exceptions though. Never say never.

I sometimes jump on a thread with challenges when someone has a 'great, new, investment plan'. While it may sound like I'm just trying to confirm my own beliefs, I am really hoping that there is a nugget in there somewhere, something I can learn from. I did say 'pretty much' given up on it


-ERD50

 

[haha]

haha, I don't think people are saying that an individual cannot do well with individual stocks or picking their own funds. I personally think it is somewhat unlikely (by 'better' I mean risk-adjusted), and I've pretty much given up on it myself, but that certainly doesn't mean it can't be done. You appear to be one data point to support that it can. You may be the minority, but I'm sure you are not alone.

However, I think most of us are saying that it is *really* unlikely that you can pick some manager and pay expenses, and end up better off. Yes, there is a fair amount of 'group think' on this forum, but I tend to think there is some basis for it when it comes to this subject. One must allow for exceptions though. Never say never.

I sometimes jump on a thread with challenges when someone has a 'great, new, investment plan'. While it may sound like I'm just trying to confirm my own beliefs, I am really hoping that there is a nugget in there somewhere, something I can learn from. I did say 'pretty much' given up on it


-ERD50

You may well be right. I don't know because I haven't tried that.

Ha