I like to think I’m mentally prepared for 5% nominal returns for the next 7-10 years since my withdrawal rate is around 2% and I don’t auto adjust upward for inflation. However, even though I think I’m prepared I have a feeling it will be stressful to go through such a long period of low returns while living off the portfolio. I did OK mentally from 1998-2006 (about a 6% CAGR), but I was working, making pretty good money, and I was a net buyer of stocks (mostly Berkshire), so that was not really too stressful as I thought I was picking up bargains.
Full on excellent piece of work and analysis. Well done.
I like to think I’m mentally prepared for 5% nominal returns for the next 7-10 years since my withdrawal rate is around 2% and I don’t auto adjust upward for inflation. However, even though I think I’m prepared I have a feeling it will be stressful to go through such a long period of low returns while living off the portfolio. I did OK mentally from 1998-2006 (about a 6% CAGR), but I was working, making pretty good money, and I was a net buyer of stocks (mostly Berkshire), so that was not really too stressful as I thought I was picking up bargains.