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A comment on Fund manager: ‘Nightmare’ US stock valuations driven by ‘young, dumb’ investors. Parent comment

Re:Fund manager: ‘Nightmare’ US stock valuations driven by ‘... by hcknwscommenter on Friday October 16, 2020 @03:47AM (#24798583)
>Look at any long term chart. I'll take the risk.

There are 30 year periods where US stocks (spy 500 or a close proxy thereof) posted a negative total return. Are you prepared for that?

My larger point is that 12-15% return assumption is absurd. There are very few long-term periods where that has ever been achieved in the US market, most (but not all) of which were followed by a deep and long-lasting correction.

The alternative is to assume a lower return like 5% and plan accordingly.

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Re:Fund manager: ‘Nightmare’ US stock valuations driven by ‘... by icedchai on Friday October 16, 2020 @10:00AM (#24800875)
Despite these huge gains over the past 10 years, I do agree with you. I plan for a 3.5% withdrawal rate during retirement (hopefully early retirement.)
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Re:Fund manager: ‘Nightmare’ US stock valuations driven by ‘... by hcknwscommenter on Monday October 19, 2020 @05:44PM (#24831372)
You can still plan for a 3.5% withdrawal rate and be way off of what you need to retire if you are assuming a 12-15% return rate.
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Re:Fund manager: ‘Nightmare’ US stock valuations driven by ‘... by icedchai on Monday October 19, 2020 @10:36PM (#24833443)
I already hit my FIRE goal, so not a problem for me.
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Re:Fund manager: ‘Nightmare’ US stock valuations driven by ‘... by hcknwscommenter on Thursday October 22, 2020 @01:27PM (#24860568)
Good for you, but your FIRE goal either explicitly or inherently assumes both an inflation rate and an expected return rate. It is crazy to ignore both as you seem to be doing with your statement that you are safe from failing to meet 12-15% returns simply because you are assuming a 3.5% withdrawal rate. In addition to inflation and expected return, you also should consider max draw down potential.
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