My RoR since 2010 has been 7.3% and I am OK with that. I am not dependent on my investments for my living costs and have been conservatively invested.
Nope, I have enough money. More than sufficient for our needs. I know that you cannot help counting money as success, but for some of us, having enough is enough. Is there a score board somewhere? Why do you want more? what good is it?
Yeh, and I have expectations of all the exercise I'm gonna do All kidding aside, I've been please with the return on my 401)k), considering that a chunk of it is in safe 2% Return stuff. My Annualized ROR for this year is over 8%. For some of us, it's not really wanting "more," it's needing "enough." Not everyone has more than they need...and needs change. Money cannot make you happy, but an insufficient amount can sure add stress.
You can have "expectations", but then pandemics happen. We don't draw from our investments so they just rock along. I'm more concerned about whether dividend rates will eventually be cut.
Lon, you mentioned something important that lots of people tend to ignore: Never make yourself dependent on ROI let alone during retirement. The low or zero interest rate policy has messed up private pension plans of many people who mistakenly believed that there would be constant risk-free earnings from their at-sight savings accounts. How could they ever have expected that with fluctuation being a key feature of any market-oriented economy. Like you, I didn't put all my eggs in one basket and always made sure I could do without any ROI at all. As I wrote earlier on I'm no longer heavily invested in the stock market. My returns from both stock and bond market investments are modest but I don't need them anyway.
An interesting thing I believe has changed is that retired people used to put their investments in safe, conservative things: bonds, CDs, Money Market accounts, maybe dividend-yielding Blue Chips. But no equities. I don't know when things changed, but now much of the advice is for retired folks to have exposure to equities. That frightens me on behalf of a lot of folks who could not weather a downturn. There are a ton of different "strategies" out there. One from Morningstar intrigues me: -Keep 2 years worth of withdrawals in cash -Keep enough money for years 3 thru 10 in short-term investments (CDs, Money Mkt Accounts, Bonds) -Anything money over 10 year's of need goes into the stock market That way, when the market takes a downturn, you won't be cashing out stocks when they're low, because you don't need to touch that money for another 10 years. You'll leave them alone for the assumed recovery.
Do you have that kind of money John, Two years of withdrawals? in cash? !0 years of need? Damn I must be a fricken poverty case next to you. Of course I don't worry about downturns. I am fat dumb and happy, don't go without anything that I need, have money left at the end of the month. My annuity could just disappear and I wouldn't miss it. Social Security and pension more than covers my modest needs.
I own 13 acres of land a four bedroom house all paid for, we each have a 2013 car,(she is trading hers come January) we will decide whether or not to make payments depending onthe interest rates when the time comes we bring in less than 50k. We need nothing more.
I thought the same thing when I first read that recommendation ("who has that kind of money???"), and started to type an explanation to my comment because of how it sounds. Then I deleted it. Way too much verbiage for one comment, even for me Like you, I'm frugal and my needs are pretty simple. I didn't grow up with much (but had no idea, because all my needs were met and back then you entertained yourself) and was pretty house poor for a while as an adult, so know the difference between "wants" and "needs." Heck, I just drop $50 on a pasta machine and $6 on a gnocchi board and it's got me occupied for a good while! I'm making two new types of ravioli tomorrow, plus a couple of "shaped pastas." And friends are grateful when I share. Social Security covers my needs, too. Although I have no pension, I've got a modest 401(k) account. I've been lucky enough to have paid off my house (the benefit of selling a tiny home I lived in for nearly 40 years without having the urge to "trade up.") Frankly, between groceries, car costs (insurance + fuel) and taxes (property and real estate), I'm surprised at just how much it does cost to "just exist" each month. The amount it costs to feed one adult who cooks all of his meals still surprises me. So when MorningStar talks about having "Two years worth of withdrawals," it sounds like both you and I are in the same boat...it's darned little money. The same goes for expenses 10 years out, barring a catastrophe. Knock on wood, the only reason I'll be taking money out of my 401(k) account is I'll hit the Mandatory Withdrawal age. As an aside, I've done quite a bit of volunteer work since I moved here 10 years ago, much of it in people's homes. I realize how very lucky I am. I lived outside of DC for nearly my entire life (and pretty much my entire career.) I've seen first-hand people who have so much (and I mean a LOT) and are so darned ungrateful (and dissatisfied), it truly boggles the mind. I've also seen those in this region who apparently have so little yet are quite content...and unselfish with what they do have.
I've purchased 3 new vehicles in my life, after driving cars I paid $500 cash for, "traded up" when the opportunity arose, and then got my money out of when I sold them. If I needed to travel any great distance, I rented. -1989 Chevy S10 pickup (drove it for 15 years) -2005 GMC Canyon (still have it) -2019 Mazda CX-5 I mainly purchased the Mazda because my 1990 Volvo (740 Turbo Intercooler sedan) took out Bambi's dad one foggy night. Nicest deer I've seen around here. 12 point buck just standing in the road. The car was less than 200 miles shy of turning 200,000. Not having a trustworthy car in the country is a real life-inhibitor, so I bit the bullet with the Mazda (0% dealer financing.) My entertainment mostly comes from attending free events in the region, and with a nice car I'm able to haul friends who might not otherwise be able to attend. That car is my only discretionary spending. The payment at 0% was darned near the payment on a used car at used car finance rates...that's mainly why I went new. It is the nicest vehicle I've ever owned. 2019 CX-5 CUV with the 2.5L turbo. I wish I had discovered the brand before. Mazda makes a very well-engineered product. Truly is a "driver's car."
Let's all list our Net Worth, including Real Estate, Cash, Investments, and Personal Property Assets. You first:
No. I never had any investments. Lived from hand to mouth, by the seat of my pants, as it were. I used to envy people who were brilliant in the handling of their money and investments and could, if they chose, to brag a bit. But since I arrived at where I wanted to be financially, living the dream, I seldom think of money matters any more. Glad your investments are giving you a good return.
Trust me, I scraped bottom many times throughout my life. And without specifics, "investments" can mean a lot of things...like savings accounts of any amount placed in CDs. I mostly got lucky with the timing of where I owned a house for so many years. Things would be way different for me if not for the DC housing market and decades of home ownership. I often think of the speaker I saw long ago at a college commencement ceremony. I can't remember the woman's name, but I'll never forget her words: "All I can tell you as you go through life is this: you don't get what you deserve, and you don't deserve what you get." Yup.