Quote:
Originally Posted by SSLance
Again, just being devil's advocate here...but here's a look at this same scenario from my current view. Remember, I have no kids and our siblings have no kids...so no heirs at all to worry about leaving anything to.
Given that, say I take that same million dollars and put it in a CD or likewise investment and pull the same $50,000 a year out of it. That's 20 years minimum of cash flow without taking a single bit of risk. I'll be 67 years old by then, the wife even older and I'll be tired of enjoying my money by then as I've had the last 20 years of freedom with no worries.
BTW, my average ROI for the 15 years I was in the market, 4.5% before taxes. Were there mistakes made, sure...but there were also 3 major corrections during that 15 year period, none of them caused by any actions of mine. And we had plenty of good years as well with well more than 8-9% appreciation. My investment life timing has just sucked.
Like I said in my first post, the investor's lost decade.
I'm an accountant by nature, so I realize that one can make numbers spin just about anyway one wants to given different scenarios. You can make things appear rosier and I can make them appear worse, just by juggling things around. I'm trying to not play that game.
I really am trying to figure out a method by which I can keep up with inflation while incurring minimal risk at the same time. It's almost like I need to look at this as if I was already 67 years old yet I can't pull money out of my IRAs for another 12 years or so without a 10% penalty.
Keep in mind, we have other assets and incomes in place already as well. I'm mainly concerned about the hunk we have in our retirement accounts and taxable investment accounts.
I realize my situation is different and if you'd rather not discuss it in this thread, I understand. I have pretty much exhausted the normal people I would talk to things like this about and welcome a different perspective. I believe that things are different after 2008 and with no signs of QE ending anytime soon, I don't believe anyone knows what is coming around the bend. I do like to talk about it with those that are participating though.
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Not to pick on you but I'd like to add some perspective.
One of life's greatest values is helping others. As you grow older, I hope you find some people and charities that you would be happy to leave your stakes to at the end of the day.
Wouldn't it be great to spend a chunk of your retirement helping others with your time and money? That's one of my long term goals.
I don't see how a CD is going to be a sufficient game plan. Right now you are lucky to get 1%. That's $10,000 on $1,000,000. When interest rates go up, so will the returns on CD's but inflation will kick your butt.
The bottom line is you must put your money to work if you plan to become financially independent. There will be plenty of springs of opportunity, you just have to keep your nose in the wind.