Watching Interest Rates

[Gatordoc50]

10 year hit 2.9% today. And that's prior to any tapering.

 

[JOHNNIE36]

That's fine, but even at 77 you have to think about inflation.

I put a 20 year time frame (so to age 97) into FIRECalc, and it shows 35%-40% equities to be the 'sweet spot' for portfolio survival. That allows you to take 4.7% WR from the portfolio with 100% success. A zero% equities would fail ~ 20% of the time.

To get 100% historical safety with zero equities for 20 years, you need to drop the WR to 3.67%.

If that lower WR works for you, and zero equities helps you sleep at night, then you've got a plan. But you've swapped 'market risk' for 'inflation risk'. You haven't actually reduced portfolio survival risk with zero equities, you've increased it. But again, if that works for you, then you've got your plan.

-ERD50

I hear you ERD, but at this stage in my life I don't worry about things like inflation and withdrawal rates. I haven't taken any withdrawals in four years and don't plan to in the coming years. The only WD I take is from the IRA for my RMD. Then I just bought another CD with those funds and continued on. We have a decent pension through Prudential (was GM), we both get SS and we receive regular payments on a mortgage we are carrying on our last house. The mortgage has nine more years to run, by that time I'll be 86 and probably won't give a s**t about anything.

Still, I'm always interested in what people have to say about their investments and what they are into. I've come to know over the years that there are some really sharp people on this forum. Really, I am envious of all the people that are FIRE'd that were able to do it without pensions and still waiting on SS. Kudo's to you folks.

 

[ERD50]

I hear you ERD, ... I haven't taken any withdrawals in four years and don't plan to in the coming years. ....

Well, at a zero withdrawal rate, I don't even need FIRECalc to tell me how long your funds will last, or the optimal AA

Congrats, who knows, maybe I'll be there some day?

-ERD50

 

[JOHNNIE36]

But you know what? One never knows when an illness will hit and it will take you down the path to financial ruin. Even with insurance, a serious illness could take every thing you have. I thank my lucky stars every day and pray for good health for my wife and myself.

 

[Bestwifeever]

But you know what? One never knows when an illness will hit and it will take you down the path to financial ruin. Even with insurance, a serious illness could take every thing you have. I thank my lucky stars every day and pray for good health for my wife and myself.

I'll give a big Amen to that prayer.