Question on return on investment

[Safire]

Currently, our retirement portfolio is split up between Vanguard's Total Stock, Total International, International Growth & some individual stocks. We have two municipal bonds funds but no total bond fund.

What is a REALISTIC rate of return to assume to calculate the size of the retirement eggs in 15 years' time? I don't want nasty surprises in retirement, but I don't want to be overly pessimistic as well.

I use the following calculator:

https://www.investor.gov/financial-tools-calculators/calculators/compound-interest-calculator

I also tried FireCalc to run numbers in retirement but had trouble inputing numbers (poor vision and font size - despite CTRL + - wasn't helping)

Thanks!

 

[disneysteve]

What is your allocation between each of those funds and stocks? How much in US stocks, how much in international stocks, how much in bonds?

 

[SevenUp]

What is a REALISTIC rate of return to assume to calculate the size of the retirement eggs in 15 years' time?

That is a great question, but unfortunately there are no clear answers. There are many opinions, but the only reliable answers will come after the fact.

Pick an asset allocation that is comfortable for you, invest what you can, and things will work out however they will. As that 15 years becomes 10, 5, 3, etc., the +/- on your estimate will shrink, but even one year out there can be significant uncertainty.

 

[disneysteve]

Personally, I use 5% for stocks, 2% for bonds, and 0.5% for cash.

I’m not sure about the international stuff as I don’t have a lot in foreign stocks.

 

[Safire]

What is your allocation between each of those funds and stocks? How much in US stocks, how much in international stocks, how much in bonds?

Will be 78% total stock fund & individual stocks, 5% total international fund, 5% international growth fund, 2% munis & 8% cash.

This will be adjusted eventually over the next 5 year to add bonds until we get to 50% stocks, 30% bonds & 20% cash at retirement.