News for hackers. Stuff that matters.

A comment on Mr. Money Mustache’s retirement (sort of) plan.

Re:Mr. Money Mustache’s retirement (sort of) plan by josh_fyi on Monday February 22, 2016 @03:26AM (#11149380)
How does he rely on regular returns on investment of 7% or 4%?

You don't get that on bank accounts; and the stock market too has not given such returns over long-term timespans in the last 15 years.

[ Parent | on HN ]
Re:Mr. Money Mustache’s retirement (sort of) plan by HappyTypist on Monday February 22, 2016 @03:39AM (#11149428)
A very simple allocation of 70% stocks and 30% long term treasury bonds has a 6.23% CAGR over the past 15 years.

https://www.portfoliovisualizer.com/backtest-asset-class-all...

[ Parent | on HN ]
Re:Mr. Money Mustache’s retirement (sort of) plan by josh_fyi on Monday February 22, 2016 @03:44AM (#11149442)
Thank you. 6.23% before taxes and inflation, less after these.

Is this reliable enough over the long run to retire on?

[ Parent | on HN ]
Re:Mr. Money Mustache’s retirement (sort of) plan by hudibras on Monday February 22, 2016 @04:31AM (#11149619)
Keep in mind that the period 2000-2015 includes two major recessions. Almost any other fifteen year period will work even better (you can test it on that website). Move the timeframe to 30 years (which is the bare minimum that the early retirement crowd looks at) and it's difficult to find a period with less than 7% returns. Even adjusting for inflation, it's rare to have a 30-year period with less than 4% returns, which is the basis for the 4% Rule mentioned in the article.
[ Parent | on HN ]
Re:Mr. Money Mustache’s retirement (sort of) plan by lukego on Monday February 22, 2016 @04:18AM (#11149560)
Relevant MMM post: http://www.mrmoneymustache.com/2012/05/29/how-much-do-i-need...
[ Parent | on HN ]
Re:Mr. Money Mustache’s retirement (sort of) plan by ciconia on Monday February 22, 2016 @04:33AM (#11149627)
The golden rule is to spend no more than 4% of your assets per year, so it's quite doable.
[ Parent | on HN ]
Re:Mr. Money Mustache’s retirement (sort of) plan by harryjo on Monday February 22, 2016 @03:49AM (#11149460)
It is if you are a famous blogger pulling in lots of ad revenue.
[ Parent | on HN ]
Re:Mr. Money Mustache’s retirement (sort of) plan by miseg on Monday February 22, 2016 @06:06AM (#11149994)
Just a note for people outside of the States.

I've seen this before, and live in Ireland. It's a very different story here, with taxation on ETF index funds at 40% on gains, calculated every seven years. From my perspective, the 4% rule just does not count. Perhaps running a business is a better way in Ireland, for example.

[ Parent | on HN ]