Feeling Discouraged

[RobbieB]

Two guys were out fishing on the river set up the lawn chairs and one guy noticed that nothing was twitching the other guys rod so he reeled it in and said "you ain't got no bait on your hook"

The other guy said "I know"

 

[jkern]

I believe Dave Ramsey uses 12% return to encourage saving and investing vs. spending and borrowing. I think that anyone who quotes a steady 12% return is just trying to sell you something.

I've tried to keep my expectations reasonable so I don't get discouraged. During my accumulation phase (1986 to June 2009), my average annual return was about 2.5%. A non-linear contribution rate and sequence of returns really killed my average rate of return. Not having to withdraw any of my retirement account, it has doubled since 2009.

 

[gayl]

I believe Dave Ramsey uses 12% return to encourage saving and investing vs. spending and borrowing. I think that anyone who quotes a steady 12% return is just trying to sell you something.

Just 1 of my problems with DR. I'd rather have real numbers

Eventually compounding takes over

 

[RetireAge50]

12% might be a bit high but not totally out of whack if you use growth funds. A 100% stock fund has returned 10.1% on average since 1926 according to Vanguard.

https://personal.vanguard.com/us/insights/saving-investing/model-portfolio-allocations

 

[DrRoy]

While I certainly wish that future returns were higher, I would not go so far as to say I was discouraged. It does help that inflation is low, so part of your return reduction (nominal to real) is better than your statement. I started saving at 21 and my spending is under control, so I will manage with a 2-2.5% WR. Good luck to you.