Going Sailing
Dryer sheet aficionado
I have come to appreciate a remarkably consistent voice here on this forum. Life is good if you live below your means, buy Vanguard funds with a low management expense covering the whole market, get your asset mix right and live with some nice sustainable withdrawal rate that maximizes the long term chance of success. I don't mean to simplify because there is obviously a spectrum of remarkably sophisticated financial minds here with a broad range of opinions on all sort of matters, but advice tends to come back to something like that.
I think it is great. I have moved my investments out of some funds that were expensive and have them in a happier place after reading some here. Now I have a confession.
Once or twice a week, sometimes only once or twice a month, I get an email that says sell stock x, buy stock y. And I go and sell the designated quantity of stock x and buy the designated quantity of stock y. And most of the time I have no idea what company x or company y even do.
The emails come from a friend who is a PhD electrical engineer with a day job and a night time quantitative hobby. He has a model that he had been running and back-tested for 30 years etc etc and it was showing consistent 30% gains.
In 2011 I had about $100k and change in cash that I was trying to figure out what to do with. So I thought what the hell, nothing else is giving me a decent return. Might as well have some fun. So I followed the trade instructions and in relatively short order, we turned $100k into $80k. All consistent with the relatively volatile nature of the model in a down market. Fun so far. I stuck with it.
By middle of last year, the account had grown to $280k. Damned if it didn't work. But for me at least, $280k was kind of well beyond fun money range. So I took all of the original investment out and put it into some nice Vanguard ETFs.
Now I am playing with house money so to speak. The annualized return since inception is 23.4%.
Up until last year, my overall retirement portfolio has been 100% equity. I had always felt that the biggest risk was being to conservative.
Now, I have just bought a small town home in a good seasonal rental market that will be built in a year. Moved my boat to a less expensive slip. Called the realtor to find out what we need to do sell the big house for the best value. Have long since given up the home phone and cable TV. Looking forward to a life without debt and dreaming about sailing away.
Which is all very weird, because the notion of retiring on ~4% withdrawal rate on a portfolio that will be about $1mil seems absolutely crazy based on our current rate of spending. Cars, cell phones, insurance for everything, mortgage, vacations etc.
But over on another forum there are cruisers who endlessly debate the merits of living on $500 month. Another thread talks about the $2500 a month lifestyle and the luxury that it affords. If I posted over there suggesting I had a paid for boat and a million dollar cruising kitty (the cruising kitty is the retirement portfolio that you blow while sailing the world - and perhaps work occasionally to top up), the overwhelming question would be "what the hell are you waiting for?". Here on this forum if we look at same fact set the advice would probably be keep working...
It all seems very risky, but I don't think there is a reset button if you get to 80 and don't like the way you lived your life. So what the hell.
But it is weird feeling living on this boundary between relatively high income and what would be a very modest land based income, relatively aggressive investing approach and relatively conservative portfolio going forward, relatively high debt and no debt, high cash consumption and spending very little.
I just have to flip the switches in the right sequence and not screw up. The double life is hard. One small slip and I am working another 5 years...
I think it is great. I have moved my investments out of some funds that were expensive and have them in a happier place after reading some here. Now I have a confession.
Once or twice a week, sometimes only once or twice a month, I get an email that says sell stock x, buy stock y. And I go and sell the designated quantity of stock x and buy the designated quantity of stock y. And most of the time I have no idea what company x or company y even do.
The emails come from a friend who is a PhD electrical engineer with a day job and a night time quantitative hobby. He has a model that he had been running and back-tested for 30 years etc etc and it was showing consistent 30% gains.
In 2011 I had about $100k and change in cash that I was trying to figure out what to do with. So I thought what the hell, nothing else is giving me a decent return. Might as well have some fun. So I followed the trade instructions and in relatively short order, we turned $100k into $80k. All consistent with the relatively volatile nature of the model in a down market. Fun so far. I stuck with it.
By middle of last year, the account had grown to $280k. Damned if it didn't work. But for me at least, $280k was kind of well beyond fun money range. So I took all of the original investment out and put it into some nice Vanguard ETFs.
Now I am playing with house money so to speak. The annualized return since inception is 23.4%.
Up until last year, my overall retirement portfolio has been 100% equity. I had always felt that the biggest risk was being to conservative.
Now, I have just bought a small town home in a good seasonal rental market that will be built in a year. Moved my boat to a less expensive slip. Called the realtor to find out what we need to do sell the big house for the best value. Have long since given up the home phone and cable TV. Looking forward to a life without debt and dreaming about sailing away.
Which is all very weird, because the notion of retiring on ~4% withdrawal rate on a portfolio that will be about $1mil seems absolutely crazy based on our current rate of spending. Cars, cell phones, insurance for everything, mortgage, vacations etc.
But over on another forum there are cruisers who endlessly debate the merits of living on $500 month. Another thread talks about the $2500 a month lifestyle and the luxury that it affords. If I posted over there suggesting I had a paid for boat and a million dollar cruising kitty (the cruising kitty is the retirement portfolio that you blow while sailing the world - and perhaps work occasionally to top up), the overwhelming question would be "what the hell are you waiting for?". Here on this forum if we look at same fact set the advice would probably be keep working...
It all seems very risky, but I don't think there is a reset button if you get to 80 and don't like the way you lived your life. So what the hell.
But it is weird feeling living on this boundary between relatively high income and what would be a very modest land based income, relatively aggressive investing approach and relatively conservative portfolio going forward, relatively high debt and no debt, high cash consumption and spending very little.
I just have to flip the switches in the right sequence and not screw up. The double life is hard. One small slip and I am working another 5 years...
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