clifp
Give me a museum and I'll fill it. (Picasso) Give me a forum ...
- Joined
- Oct 27, 2006
- Messages
- 7,733
Ah no.
Thats a simple calculation and its not even close to just 1-2%. Certainly not over a 30+ year timespan.
I'd say your off by a factor of 100.
It is hard to hone on a single number but I'd say the average annual return for an aggressive portfolio vs a safe one is 4% a year, and it was more than 6% during my prime accumulation years 1980-2000. At 4% difference with steady saving that adds up to 180% and a 6% that is 240% more money. Even if saving is ramped up considerable over time so that most of the saving was done in the last 10 years it it hard to construct a case where the aggressive saver does not end up with twice as much as the rik free saver. That is for a 30 year accumulation period for a early retiree, for a more typical 40 year accumulation period the difference in saving is closer to 200-300% more.