What's your retirement nut?

[Scorpion Man]

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ANy of you guys students of the markets? Do you realize that between 1966 and 1982 (that is almost a lifetime for many on these boards) the dow was FLAT in nominal terms and DOWN 40% in real terms? That is was down 90% (yes, that is not a typo) from 1929-1933? That the NDX was down 80% 00-mid 03? That long bonds were down 20-25% in 1994? Anyone here actually had to manage a portfolio and LIVE on it? Models don't pay bills. And drawdowns are MAJOR problems when you are living off the cash flow. Retiring and NEEDING 8% per year to hit your spending is insane. And people are way underreserving for inflation -- its at least 3% of whatever return you are getting. Education and healthcare, 2 major expenses, have gone up much faster than that for years.

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The DJIA is not an entirely accurate representation of the total market.

The S&P is a better representation, although still not totally accurate.

From 1966 to 1982, the S&P 500 (dividends reinvested) nominally returned 200.2%.

I'm looking at DJIA data right now and I'm wondering did you only count capital gains (i.e., dividends excluded)?

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1) i did not look at divs that would take work. this thread is about retirement.

2) i mistyped. its 68-82 (14 yrs), not '66.

3) Specifically for you folks planning on doing it young, you really have to understand the data before making statements like you do above. I just looked at some of the S&P numbers. From 68-82, the S&P annualized at 4.6% with dividends reinvested. You after tax would have been considerably worse. Inflation was above this almost the entire time, and was double digits in some years. CPI annualized 7.6% during this peroid. It was a fking disaster. So was the early part of this decade. I am not being nitpicky on the numbers here. The DOW was down FORTY PERCENT REAL.

There are all sorts of costs that come up as you get older unless you live the life of a hermit. Having to take money out of the equity markets to fund your lifestyle while the markets are down is a killer.