In Business Since 2001 We accept Paypal
Home Article Directory
More from Bill Platt
"Bill Platt for Book Authors" Youtube Channel
Training for Book Authors
Other Resources for Book Authors & Publishers
FictionPlots.com (350+ Plots & counting)
Please Support Our Advertisers

 
D9 Hosting


Retirement Planning Wars

Copyright (c) 2005-2020

Through our working lifetime, saving forces battle the ‘live life’ forces. In our family sometimes saving won and sometimes spending won. As retirement approached we had equity in our home, a small nest egg, and no consumer debt.

Through our working lifetime, the conservative asset allocation forces battled the aggressive asset allocation forces. In our family, we mostly allocated and diversified with random financial transactions. There was no written or even spoken plan. Individual transactions were analyzed as discrete events loomed, not as part of a total plan. Thankfully we weren’t living beyond our means or wildly aggressive investors. As retirement approached our nest egg was split 50/50 between common stock and money market funds.

Finally, I retired and only then began studying our financial life from a big picture point of view.

Most of my early reading reinforced the common perception that asset allocation between asset classes reduces risk. The theory is that prices in different asset classes inflate and deflate at different rates. Rising bond prices might offset falling stock prices. Rising real estate prices might offset falling commodity prices. One of the champions of asset allocation is Burton G. Malkiel, PhD. In A Random Walk Down Wall Street he popularized a life-cycle approach to asset allocation. He proposed that retirees should shift more of their nest egg into bonds or other fixed income securities. The theory is that when salaries/wages stop and projected years to live decrease we can tolerate less risk.

Along the way I started looking at ways to access the equity in our home. I looked at reverse mortgages and discovered what reverses is the mortgage balance. In a conventional mortgage the balance decreases with each payment you make to the bank. With a reverse mortgage the balance increases with each payment the bank makes to you. The balance grows, but at some point the bank has to be paid off. Often cash is raised to pay the bank by selling the home.

Jeremy Siegel, PhD. studied more than 200 years of US stock market data. He determined on average the stock market returns a real return of 6.8% per year. He found that on average the stock market out yields other equity classes, and says “stocks remain the best bet in the long run for US investors.”

In mid 2002, these ideas were swirling around in my retired head. Diversifying asset classes reduces risk. Stock market has greatest average return. Interest rates, mortgage rates are at a fifty year low. I also knew from financial theory that pursuit of greater return requires acceptance of more risk. Conversely, avoidance of risk limits return. Some Excel spreadsheets with random number generators convinced me that the average annual draw from a retirement nestegg 100% in equities would exceed that of any mix of bonds and equities. Average draw would be more, but in individual years the draws possible for a bond portfolio are sometimes greater.

In July of 2002, we refinanced our mortgage and invested the proceeds in the stock market. The account is also my checking account. The plan was to keep the account balance at about the mortgage balance. The balance would be maintained by spending less if the account fell below the mortgage, and spending more if the account climbed above the mortgage. The account started with $128,175.86. Since then I’ve withdrawn $34,921.17 more than I have deposited, the investment value has grown by $35,782.19 and the account is at $129,036.87. The withdrawals include all interest and principle payments and closing cost for the first refinance and for a second refinance along the way. The mortgage balance is $127,766.97.

This strategy is working for us. I like the idea of staying flexible, slowing spending when the market is down and spending more when the market is up. Last year I spent $10,000 on reflooring and painting our condo. This year I’m spending the same on a 1990 Mustang Convertible. These are flexible projects. The market gave a little extra so we spent it. This strategy is probably not appropriate for everyone. There is always the chance that a bad year in the market will coincide with large inflexible expense.

In retrospect, I wish I had figured out at the start of my working life that diligent investment into a diversified equity portfolio would have made me wealthy. I wish I’d figured out borrowing for an investment was probably a better use of credit than borrowing for a new car. But, when you are in your twenties, who thinks deferred consumption is good. I’m happy now with more than 100% of my equity in the stock market.

In a future article I’ll discuss my Excel retirement draw models, and point out a website that goes far beyond. The website lets you play with asset allocation, funding amounts, and your expected longevity to see what your monthly withdrawal will be.


About The Author: Shop Amazon - Top Gift Ideas
Lyle Wilkinson, investor, trader, author, MBA Helps individuals learn to self direct their stock portfolios. Book, e-book, PowerPoint "DIY Portfolio Management” http://www.diyportfoliomanagement.com mailto:joe@diyportfoliomanagement.com

VOTE ON THIS ARTICLE
Needs Work >> 0 - 1 - 2 - 3 - 4 - 5 << Excellent Article

Tell our authors what you think about their article.



Top-Level Category: Articles

10 Most Recent Articles Written by Lyle Wilkinson

How I Built a Kayak
Written by: Lyle Wilkinson | Distributed: 2006-06-06 | Word Count: 1178 | Page Views: 5934 | Votes: 17 | Rating: 1.35
Nowadays, most kayaks come from big machines, crews, and an assembly line. However, the roots of kayak building are DIY (do it yourself). With modern materials the options available to do it yourself builders have expanded. You can build "skin on frame," wood strip, plywood, fiberglass, or plastic. You can build a cedar strip work of art, you're afraid to get wet, or a kayak so ugly you don't have to worry about theft.

What's Working Now?
Written by: Lyle Wilkinson | Distributed: 2006-04-18 | Word Count: 0 | Page Views: 1199 | Votes: 2 | Rating: 0.00
Financial markets are not static. What works now might not work tomorrow. Sometimes what worked in the past will start to work again.

Top 3 Wealth Building Mistakes - Do You Make Any of Them?
Written by: Lyle Wilkinson | Distributed: 2005-05-20 | Word Count: 0 | Page Views: 2209 | Votes: 2 | Rating: 0.50
Do you procrastinate? Investing mistake #1 is waiting too long to begin. The wealth building formula needs time to work.

Exchange Traded Funds Are Good for Investors
Written by: Lyle Wilkinson | Distributed: 2005-04-28 | Word Count: 0 | Page Views: 1143 | Votes: 2 | Rating: 0.00
Exchange Traded Funds (ETFs) are growing. Investors are choosing low annual expense and market return over high annual expense and promised performance.

Why Manage Your Nest Egg Yourself?
Written by: Lyle Wilkinson | Distributed: 2005-04-05 | Word Count: 0 | Page Views: 1263 | Votes: 2 | Rating: 0.50
Why would anyone manage their own stock portfolio? Why would you want to? You want a better net return. There are two parts to a better return, gross return and investing expense. Investing expense is simply the gap between gross return and net return.

All of Author's Articles on this site:

Most Recent "" Articles

Ann Arbor, MI Offers A Lot Of Year-Around Family Fun
Written by: Jeb Maxwell | Distributed: 2010-01-20 | Word Count: 595 | Page Views: 3558 | Votes: 8 | Rating: 1.25
Ann Arbor, Michigan is the home of the University of Michigan, a leading institution of higher education. Ann Arbor is a wonderful place to visit. The University is co-mingled with the city and greatly expands the cultural places and events available in the area.

Flowers Are The Perfect Gift For Father's Day
Written by: Wesley Berry, AAF | Distributed: 2008-02-20 | Word Count: 486 | Page Views: 4985 | Votes: 11 | Rating: 2.09
Dads everywhere have Sonora Smart Dodd to thank for getting Father's Day started. In 1909, Sonora sat in a church in Spokane, Washington listening to a sermon expounding on the virtues of motherhood. But, as she sat there, she thought about how special her own father was since it was he who raised her after the death of her mother.

Finding the Adventure in Travel Again
Written by: Helen Bergstein | Distributed: 2006-05-11 | Word Count: 718 | Page Views: 3665 | Votes: 14 | Rating: 2.64
If you want to experience adventure at every level of your next trip, you need to go beyond the usual resorts and places to stay. If you're like most travelers, personal safety remains a priority, especially in today's world. A growing number of savvy travelers have found the perfect balance between adventure and comfort.

7 Tips to Hiring a Good DJ for your Party
Written by: Kamau Austin | Distributed: 2006-05-11 | Word Count: 563 | Page Views: 4595 | Votes: 11 | Rating: 1.36
If you want to have a party that everyone will be talking about for days and years later, hire a good DJ to run your music and light show. Hiring a DJ can actually be fun. Just follow these simple tips, and you are sure to have a fabulous DJ for your party.

Building your Credit to get a Mortgage
Written by: Kamau Austin | Distributed: 2006-05-11 | Word Count: 840 | Page Views: 4626 | Votes: 11 | Rating: 2.09
You are thinking about purchasing real estate. However, you are not sure if your credit is good enough to get a mortgage. There are things that you can do to build your credit so that it is worthy of any mortgage that may interest you.

1569 Unique Ways To Get A Free Lunch
Written by: Steve Robichaud | Distributed: 2006-05-07 | Word Count: 0 | Page Views: 2750 | Votes: 3 | Rating: 0.33
Everywhere you turn - T.V., Radio, magazines, or the Internet, someone is talking about government grants. What's the real story? Does the government give away real money, to ordinary people, to use for whatever they want? Let's take a closer look:

Don't Wait to Start Your Marketing Strategy
Written by: Jo Fulkerson | Distributed: 2006-05-07 | Word Count: 0 | Page Views: 3063 | Votes: 3 | Rating: 0.33
Your novel is finished, you’ve had it edited by a professional Editor, and you’ve done the rewrites. What? You haven’t had an editor edit your work yet? This is a must. There are many editors advertising in Writer’s Digest.

NEVER Reply to an eGroup Post!
Written by: BIG Mike McDaniel | Distributed: 2006-05-07 | Word Count: 0 | Page Views: 4257 | Votes: 3 | Rating: 0.33
eGroups are collections of people subscribed to a common (discussion list) address. When one member sends an eMail message to the eGroup address, it is automatically sent to everyone else on the list. As subscribers open and read their eMail, discussion threads take shape with additional posts and replies. The attraction of eGroups is the ability to join in at your convenience as opposed to the confinement of live chat rooms.

Reasons behind Shoulder Pain
Written by: Jessica Horowitz | Distributed: 2006-05-07 | Word Count: 0 | Page Views: 4131 | Votes: 3 | Rating: 0.33
Pain between the shoulder blades, or any pain for that matter, is your body's way of notifying you that something is amiss. You should never ignore it and hope it will *go away by itself*. There are a multitude of possible causes of pain between the shoulder blades. We'll discuss common ones in this article and start with the most serious conditions first:

Effective Managers Need To Coach
Written by: Wendy Hearn | Distributed: 2006-05-07 | Word Count: 0 | Page Views: 3661 | Votes: 4 | Rating: 0.75
Bearing in mind the fast pace of business today and the need to stay competitive, it's essential that managers should be effective. They need to be especially effective with their people and this requires learning to coach. For most managers, coaching has been added to their role anyway, but the majority haven't received any training in coaching skills.

Most Viewed "" Articles

TAKING RESPONSIBILITY - LIFE'S BIGGEST QUESTION
Written by: Richard Sparky Bryan | Distributed: 2006-05-07 | Word Count: 0 | Page Views: 13048 | Votes: 3 | Rating: 0.33
When did Americans stop taking responsibility for their own actions? My friend agreed that the slide began in the late 1960's with the growth of the drug culture. But he was quick to emphasize that although the sixties began the slide, the real sharp slope did not arrive until the 1990's. Along about 1993, the slide began to sharpen. It was not until early 1998 that the slope became a steep cliff.

High Thread Count Bed Sheets. How Many Threads Does A Bed Sheet Need?
Written by: Liz Beresford | Distributed: 2004-09-14 | Word Count: 0 | Page Views: 5653 | Votes: 3 | Rating: 0.33
High thread count bed sheets, often called percale, are much advertised, but what exactly does 'high thread' count mean? You know that it means quality and comfort, but do you know why? It used to be considered good to have thread count of 180-200 but thread counts of up to 1000 are advertised these days.. So what is going on? Does high thread count always mean better quality? Is there an optimum thread count, and if so what is it?

Muzzling the Motor Mouths: Silence Workplace Windbags
Written by: Bill Lampton Ph.D. | Distributed: 2005-12-01 | Word Count: 0 | Page Views: 5479 | Votes: 4 | Rating: 0.50
During my twenty-three years in management, I dealt with blabbermouths frequently, so for the last ten years I have advised clients on how to silence the workplace windbags. Here are my suggestions for muzzling the motor mouths:

Better Than Botox is there a Safer Substitute?
Written by: Kamau Austin | Distributed: 2005-09-08 | Word Count: 0 | Page Views: 5385 | Votes: 3 | Rating: 0.33
Women since time immemorial have always looked for ways to enhance and prolong their beauty. This of course becomes more difficult as they age.

Transform Your Work Area into a Homey Environment
Written by: Ted Roberson | Distributed: 2006-02-24 | Word Count: 0 | Page Views: 5250 | Votes: 4 | Rating: 1.25
Nothing enables one to think and work better than a comfortable working environment. Especially if you have a sedentary job, you've got to have little knick knacks around that will enliven your spirits or which you can look at for inspiration or just to zone out in relaxation.

12 Ways to Promote Your Business And Website for Free
Written by: Ivana Katz | Distributed: 2005-03-29 | Word Count: 0 | Page Views: 5115 | Votes: 3 | Rating: 0.33
You are very excited!! You have finally created your own website!! But the trouble is customers aren*t knocking on your website door. Why? The most probable answer is...

Flowers Are The Perfect Gift For Father's Day
Written by: Wesley Berry, AAF | Distributed: 2008-02-20 | Word Count: 486 | Page Views: 4985 | Votes: 11 | Rating: 2.09
Dads everywhere have Sonora Smart Dodd to thank for getting Father's Day started. In 1909, Sonora sat in a church in Spokane, Washington listening to a sermon expounding on the virtues of motherhood. But, as she sat there, she thought about how special her own father was since it was he who raised her after the death of her mother.

Building your Credit to get a Mortgage
Written by: Kamau Austin | Distributed: 2006-05-11 | Word Count: 840 | Page Views: 4626 | Votes: 11 | Rating: 2.09
You are thinking about purchasing real estate. However, you are not sure if your credit is good enough to get a mortgage. There are things that you can do to build your credit so that it is worthy of any mortgage that may interest you.

7 Tips to Hiring a Good DJ for your Party
Written by: Kamau Austin | Distributed: 2006-05-11 | Word Count: 563 | Page Views: 4595 | Votes: 11 | Rating: 1.36
If you want to have a party that everyone will be talking about for days and years later, hire a good DJ to run your music and light show. Hiring a DJ can actually be fun. Just follow these simple tips, and you are sure to have a fabulous DJ for your party.

Sell Yourself, Not Your Products or Services
Written by: Bill Platt | Distributed: 2004-05-03 | Word Count: 0 | Page Views: 4336 | Votes: 2 | Rating: 0.50
Sell yourself, not your products or services. The point we need to make is that your products and services will change over time as your business adapts to the realities of the marketplace.

Highest Ranked "" Articles

Finding the Adventure in Travel Again
Written by: Helen Bergstein | Distributed: 2006-05-11 | Word Count: 718 | Page Views: 3665 | Votes: 14 | Rating: 2.64
If you want to experience adventure at every level of your next trip, you need to go beyond the usual resorts and places to stay. If you're like most travelers, personal safety remains a priority, especially in today's world. A growing number of savvy travelers have found the perfect balance between adventure and comfort.

Building your Credit to get a Mortgage
Written by: Kamau Austin | Distributed: 2006-05-11 | Word Count: 840 | Page Views: 4626 | Votes: 11 | Rating: 2.09
You are thinking about purchasing real estate. However, you are not sure if your credit is good enough to get a mortgage. There are things that you can do to build your credit so that it is worthy of any mortgage that may interest you.

Flowers Are The Perfect Gift For Father's Day
Written by: Wesley Berry, AAF | Distributed: 2008-02-20 | Word Count: 486 | Page Views: 4985 | Votes: 11 | Rating: 2.09
Dads everywhere have Sonora Smart Dodd to thank for getting Father's Day started. In 1909, Sonora sat in a church in Spokane, Washington listening to a sermon expounding on the virtues of motherhood. But, as she sat there, she thought about how special her own father was since it was he who raised her after the death of her mother.

7 Tips to Hiring a Good DJ for your Party
Written by: Kamau Austin | Distributed: 2006-05-11 | Word Count: 563 | Page Views: 4595 | Votes: 11 | Rating: 1.36
If you want to have a party that everyone will be talking about for days and years later, hire a good DJ to run your music and light show. Hiring a DJ can actually be fun. Just follow these simple tips, and you are sure to have a fabulous DJ for your party.

Ann Arbor, MI Offers A Lot Of Year-Around Family Fun
Written by: Jeb Maxwell | Distributed: 2010-01-20 | Word Count: 595 | Page Views: 3558 | Votes: 8 | Rating: 1.25
Ann Arbor, Michigan is the home of the University of Michigan, a leading institution of higher education. Ann Arbor is a wonderful place to visit. The University is co-mingled with the city and greatly expands the cultural places and events available in the area.

How to Decorate Your Home on EBay
Written by: Pamela Cole Harris | Distributed: 2005-09-14 | Word Count: 0 | Page Views: 1395 | Votes: 5 | Rating: 1.20
If you are on a budget (and who isn’t?), a wonderful place for find home decorating accessories is auction sites like eBay. But before you go a’baying, here is some advice...

The "Proprietary Blend" Nutritional Supplement
Written by: Will Brink | Distributed: 2006-02-10 | Word Count: 0 | Page Views: 2650 | Votes: 5 | Rating: 0.60
In a nut shell, I went onto cover each of these common marketing terms that are used to sell supplements to unwitting consumers and explained each in detail as to what I view as their common misuse within the market place.

Brink's Unified Theory of Nutrition
Written by: Will Brink | Distributed: 2006-02-24 | Word Count: 0 | Page Views: 1625 | Votes: 5 | Rating: 0.60
Regardless of the topic, a unified theory, seeks to explain seemingly incompatible aspects of various theories. In this article I attempt to unify seemingly incompatible or opposing views regarding nutrition, namely, what is probably the longest running debate in the nutritional sciences: calories vs. macro nutrients.

7 Steps to Successful Telemarketing
Written by: Kamau Austin | Distributed: 2006-05-03 | Word Count: 0 | Page Views: 2282 | Votes: 5 | Rating: 0.40
Telemarketing is not as easy as it looks. Telemarketing involves talking on the phone to someone you do not know and trying to convince them to buy a product, use a service, or sign up for a special offer. Many times, telemarketers fail because they are not doing the job properly.

Offer More Payment Options than your Competition
Written by: Bill Platt | Distributed: 2004-05-03 | Word Count: 0 | Page Views: 2652 | Votes: 5 | Rating: 0.40
In order to be successful online, you must provide your customers many quick and easy ways to pay for your goods and services. It is not enough to ask folks to send a money order or check to your house or place of business. You must do more.











Download an eBook today
 
Directory Navigation
Locate By Category:

ALL Categories
Arts & Crafts
Arts & Entertainment
Automotive
Business - Offline
Business - Online
Career
Computers
Education
Family
Finance
Food & Drink
Health & Wellness
Home & Garden
Humor
Internet
Nature & Pets
Real Estate
Religion
Self Improvement
Shopping
Society
Sports & Recreation
Technology
Travel & Leisure
Uncategorized
World Events
Writing & Speaking

Change Number of Results:
50 - 100 - 200 - 500
Article Reprint Rights
Creative Commons License

This work is
licensed under a
Creative Commons
License


You are not required to show the creative commons license notice when you reprint this work.
Article Statistics
Word Count: 0

Total Views: 1365

Article Rating: 0.50 of 5
Votes Cast: 2

More Articles By Author:



Last Distribution Date:
2005-06-01 01:13:02

Internal ID: #1022





All Articles are Copyright © 2001-2020 of the Defined Authors.

All other material and images on this site are:
Copyright © 2001-2020, ThePhantomWriters.com