Husband's 401k keep shrinking (annuity, investments, Vanguard, loan)

[darrell2525]

Originally Posted by mathjak107

thats the key to success i find. just turn off the noise,the talking heads and second guessing yourself.

as i have said many times i use the newsletter not because they have such great picks or models but because by having them call the shots i dont worry about what to do next.
that alone has kept me in the game when i would have followed my brains reaction to short term events and bailed and ran.

What is the name of the newsletter you use again? Thanks you mentioned in another thread, but i cant find it.

[mathjak107]

i use fidelity insight but there are lots of others too

[DSOs]

Originally Posted by mathjak107

yep, jack thats my point. risk tolerance is number 1 criteria for putting a plan together not age....today volatility has that same mix swinging 2x that. thats more than most folks signed up for.

Exactly right! Before 2008 retirement accounts were deceptively touted as full proof as long as you modestly continue investing & stay in for the long haul. These participants’ were told to sit on the couch & relax because the pooled money, in itself, would bulletproof solid/steady returns for the MASS majority of participants.

After 2008, the pros start coming out of the woodwork stating that faltering retirement plans arise because of inexperienced participants’. Sadly, these amateurs’ admit their shortcomings (low pucker factor) but have little choice but to anxiously continue on, or pay penalties for early withdrawal.

Originally Posted by C

No.....take up a hobby and rebalance once or twice a year....there's no point in worrying if you are not drawing down.

This advice is flawed/outdated unless the Market is either rigged, or blessed with guardian angel oversight (Gov't/Taxpayer/FED).

[CouponJack]

Originally Posted by DSOs

Exactly right! Before 2008 retirement accounts were deceptively touted as full proof as long as you modestly continue investing & stay in for the long haul. These participants’ were told to sit on the couch & relax because the pooled money, in itself, would bulletproof solid/steady returns for the MASS majority of participants.

After 2008, the pros start coming out of the woodwork stating that faltering retirement plans arise because of inexperienced participants’. Sadly, these amateurs’ admit their shortcomings (low pucker factor) but have little choice but to anxiously continue on, or pay penalties for early withdrawal.

This advice is flawed/outdated unless the Market is either rigged, or blessed with guardian angel oversight (Gov't/Taxpayer/FED).

The people who panicked and pulled money out in 2008 did not know what their true risk tolerance was...(aka puker factor)...simple as that.

The market is not rigged. I'm diversified and I'm in the accumulation stage of my life well on my way to meeting my financial goals w/very little effort (I let the people who charge high fees make the market inefficient).

[mathjak107]

like i say the markets are a mechanisim for transfering wealth from the impatiant to the patiant

[Keim]

Originally Posted by mathjak107

like i say the markets are a mechanisim for transfering wealth from the impatiant to the patiant

good one!

[DSOs]

Originally Posted by CouponJack

The people who panicked and pulled money out in 2008 did not know what their true risk tolerance was...(aka puker factor)...simple as that.

That’s right. What you’re missing is that they were dubiously told there is no pucker factor as long as you keep contributing & stay the course. Some of the people who “bailed out” in 2008 either needed the money, were in over their heads, &/or realized that they were misled (lost trust).

Originally Posted by CouponJack

The market is not rigged. I'm diversified and I'm in the accumulation stage of my life well on my way to meeting my financial goals w/very little effort (I let the people who charge high fees make the market inefficient).

I see; more guaranteed, free lunch talk.

Question: How long will it take until HFT infiltrates/crowds out the lazy, careful, strategic investor? IMO, the Market apparatus will be charging high fees for EVERYONE soon enough.

Something else I don’t get: Why do you guys feel that the withdrawal stage deserves mega-attention, & the accumulation stage doesn’t? At least during the withdrawal stage you have rock solid data that allows you to adjust with pin-point accuracy—in other words you have control. You can’t control reliably/accurately during the accumulating stage; unless of course the market is rigged in your favor, or you have a guardian angel.

[CouponJack]

Originally Posted by DSOs

That’s right. What you’re missing is that they were dubiously told there is no pucker factor as long as you keep contributing & stay the course. Some of the people who “bailed out” in 2008 either needed the money, were in over their heads, &/or realized that they were misled (lost trust).

I'm not missing anything. if you don't do your homework and let your finances for someone else to handle then you can't blame anyone but yourself for losing more money than you should've...

I don't disagree w/you though that there are alot of dumb advisors out there who led people the wrong way, but you still need to do your homework...



I see; more guaranteed, free lunch talk.

Originally Posted by DSOs

Question: How long will it take until HFT infiltrates/crowds out the lazy, careful, strategic investor? IMO, the Market apparatus will be charging high fees for EVERYONE soon enough.

Not everyone will be charged high fees soon. There's alot of bad funds and expensive places to invest, but places like Vanguard and Fidelity give the average investor a very good chance at outperforming many "smart" money managers....

[mathjak107]

Originally Posted by DSOs

That’s right. What you’re missing is that they were dubiously told there is no pucker factor as long as you keep contributing & stay the course. Some of the people who “bailed out” in 2008 either needed the money, were in over their heads, &/or realized that they were misled (lost trust).

I see; more guaranteed, free lunch talk.

Question: How long will it take until HFT infiltrates/crowds out the lazy, careful, strategic investor? IMO, the Market apparatus will be charging high fees for EVERYONE soon enough.

Something else I don’t get: Why do you guys feel that the withdrawal stage deserves mega-attention, & the accumulation stage doesn’t? At least during the withdrawal stage you have rock solid data that allows you to adjust with pin-point accuracy—in other words you have control. You can’t control reliably/accurately during the accumulating stage; unless of course the market is rigged in your favor, or you have a guardian angel.

retirement planning is a subject very near and dear to my heart and i spend a lot of time learning,studying and working on my own final plan as we ready for retirement now.

let me enlighten you as to the differences between accumulation and decumulation as well as your pin point accuracy comment.


heres what your missing about decumulation vs accmulation.

while studies like the trinity study gave us an idea about how long our money should last using a particular allocation and withdrawl rate its all based on theoretical historical markets happening again and inflation being what it was .

here is the issues ,the biggest being we have been living the 10% failure rate the studies refer to for the last 12 years.that may immediately destroy any data of the past making it outdated going forward.

the latest data for the trinity study was updated in 2011 and that really only tells us how those fared who retired 30 years ago since 30 year chunks of time are studied. those time frames had little in common to what we have been seeing for more than a decade.

here is the difference between accumulation and decumulation.

the order of the gains and losses during accumulatation doesnt matter at all. an 8% annual average return over long periods of time is the same no matter the order they come in.

decumulation is a different animal all together. the order those market gains and losses come in are crucial to your portfolio living or dying .

taking withdrawals and getting hit with a string of down years early on is death to a retirement plan.

want a startling example?

the period from 1987 to 2003 the markets had 17 incredible years. the markets averaged 13.4%. thats what you saw if you were in your accumulation stage.

for those spending down the results would have varied over that time by a huge amount.

the 4% safe withdrawal theory comes from a 50/50 mix averaging about 7% with 3% inflation.

your leave 3% with the nest egg to account for inflation and your free to withdraw everything else.

well inflation ran 4% during 1987 to 2003 so leaving 4% with the house and withdrawing everything over that had some amazing results just based on playing with the order of those gains and losses over that period.

starting out with 100k the balance during the greatest bull market ever varied from a positive 76,629 left to A NEGATIVE 187,606 .00 at the end of the 17 years just by doing nothing more than playing with the order those gains and losses came in..
IS THAT INCREDIBLE OR WHAT.

a difference ranging from +76,000 to a minus 188,000 just by changing the order those gains and losses came in.

thats why the accumulation stage is a piece of cake to deal with,spending down is far more complex.

to someone spending down getting caught in a downturn and selling at a loss is like a trader having a string of losses early on. that money is gone forever even if markets recover.

thats why its imperitive to have a spending plan that avoids having you ever selling into a loss.

planners are a dime a dozen who can help you in the accumulation stage. i know very very few who i would call experts at the decumulation stage planning level

[Malloric]

Originally Posted by DSOs

That’s right. What you’re missing is that they were dubiously told there is no pucker factor as long as you keep contributing & stay the course. Some of the people who “bailed out” in 2008 either needed the money, were in over their heads, &/or realized that they were misled (lost trust).

I see; more guaranteed, free lunch talk.

Question: How long will it take until HFT infiltrates/crowds out the lazy, careful, strategic investor? IMO, the Market apparatus will be charging high fees for EVERYONE soon enough.

Something else I don’t get: Why do you guys feel that the withdrawal stage deserves mega-attention, & the accumulation stage doesn’t? At least during the withdrawal stage you have rock solid data that allows you to adjust with pin-point accuracy—in other words you have control. You can’t control reliably/accurately during the accumulating stage; unless of course the market is rigged in your favor, or you have a guardian angel.

No, they weren't. All investing comes with boilerplate warnings about capital being at risk, past performance, blah, blah, blah. One needs only to look back to the dotcom era that was just a few years before 2008 to see the last 4000+ point correction in the market. Everyone everywhere recommends adjusting your portfolio as you get closer to retirement. If you're heavily in stocks on money you'll need in five years, you're a god damned idiot. Period. A fool and his money. And let's talk about CDOs, where a lot of people lost their shirts. Anyone who thinks they can get above treasury yields with zero risk is a god damned idiot. Period. CDOs were paying out up to 16% yields in 2005. A fool and his money.

The people who got out in late 2008 early 2009 missed the 100% plus recovery... ouch again. And you really wonder why the withdrawal stage warrants attention... That's why.