Re:TerraUSD crash led to vanished savings, shattered dreams
by jmyeet on Tuesday June 21, 2022 @10:57PM
(#31831541)
> I think you're greatly underestimating how many people can "live off [...] assets"
1% of households are worth >$11m? Is that really true? I have trouble believing that but it could be true.
Either way, all it does is change it so that 95% of people should be leftists.
Also FWIW living off those assets at the lower percentiles that you mention doesn't factor in inflation, which is currently more than the 5% returns you mentioned. And a real return of 5% is a somewhat more aggressive strategy. It's more likely (and suggested) that at a certain point portfolios should become defensive as a amssive drop is way more impactful than a large positive gain.
It's also worth noting that these net worth figures include your net house value. You're not making a return on that money. In fact it's costing you money. Sure you could not own, get a return on that money instead and rent instead but that opens you up to other risks (eg as we're seeing now with massive rent hikes).
1% of households are worth >$11m? Is that really true? I have trouble believing that but it could be true.
Either way, all it does is change it so that 95% of people should be leftists.
Also FWIW living off those assets at the lower percentiles that you mention doesn't factor in inflation, which is currently more than the 5% returns you mentioned. And a real return of 5% is a somewhat more aggressive strategy. It's more likely (and suggested) that at a certain point portfolios should become defensive as a amssive drop is way more impactful than a large positive gain.
It's also worth noting that these net worth figures include your net house value. You're not making a return on that money. In fact it's costing you money. Sure you could not own, get a return on that money instead and rent instead but that opens you up to other risks (eg as we're seeing now with massive rent hikes).