Positives in Tougher Times
Bloomberg reports that even people who retired at the worst time to do so since 1926 would have made their money last 30 years by sticking to the 4% rule.
Here are the basic parameters of the 4% withdrawal rule:
Initial Withdrawal Rate:
Withdraw 4% of your retirement portfolio in the first year of retirement.
Inflation Adjustment:
Each year after the first, increase the dollar amount of your withdrawal by the rate of inflation to maintain purchasing power.
Time Horizon:
Designed to support a 30-year retirement.
Portfolio Composition:
Originally modeled with a balanced portfolio, often cited as:
- 50% in stocks
- 50% in bonds
Success Criterion:
A "safe" withdrawal rate is defined as the rate that gives a very high probability (e.g., 95%+) of not running out of money over 30 years.
Keep in Mind:
The rule was created using historical data on stock and bond returns over the 50 years from 1926 to 1976.
Past performance does not guarantee future results….
This does not guide you on where and when to pull from
This does not guide you on tax efficiency, RMDs, etc.
Overdue Bills
29% of US adults are late on one or more required payments. This jumps to 39% among lower-income households. (civicscience.com)
Certainly something to keep an eye on but you know how these polls go… how many responded? Where and how did you get the respondents? Now take the 672 responses you paid from one town mall and extrapolate to infinity… I am now seeing this reported as “the worst numbers since the great depression!” this is how information gets twisted into a narrative.
YouTube's Reach
A whopping 61% of Americans regularly use YouTube to listen to music or podcasts. (civicscience.com)
Again, from the same source, I think this is extrapolating to infinity and most likely very flawed information but have you seen my YouTube page?!
https://www.youtube.com/@planningbeforeinvesting
Hours of entertainment with new videos every week!
The Bill for an iPhone 16 Pro
Simple illustration of tariff impacts on something we all use every day.
Source: WSJ & UK Times
Certainly, just one example but a great perspective on all the pieces that come together from across the world to make one product!
Most things “manufactured” in the US are really just “put together” in the US….
Largest Stock Market Decline since 1950
"Thursday (4/3) and Friday (4/4) marked the fifth largest two-day decline in the stock market since 1950.
The only worse drops happened during:
- Black Monday in 1987
- The financial crisis in 2008
- The COVID crash in 2020
But here’s what’s even more important:
One, three, and five years after those steep declines, the market was substantially higher — 100% of the time. (finance.yahoo.com)
The lesson?
Panic today often leads to regret tomorrow. Staying invested through the storm has consistently paid off.
Remember, there’s over $7 Trillion in money market funds sitting on the sidelines!
Baby Boom!
Baby births in Tianmen, China rose 17% in 2024.
In early 2024 the city started offering serious cash incentives for couples to have more children. (Global Times)
Quite the experiment in population control.
With more than 4 times the population of the US, a baby boom is more like a population explosion!
Wall Street Record!
During Wednesday, April 9th, the market took off with over 30 BILLION shares traded in one day.
This is the heaviest volume day in the history of Wall Street. (Reuters)
Electronic trading and news have fundamentally changed our markets. Upon retirement, volatility should be expected, and your portfolio should be prepared for it. Let’s be honest, if the market just goes strait up without volatility, you’ll be just fine. Whereas, if the market crashes and you are not prepared, it can destroy your retirement.
Paul Atkins, SEC Chairman
The incoming SEC chairman owns a whopping 54 life insurance policies. The value is around 10% of his net worth which Bloomberg estimates is $330mm. (fortune.com)
Some of this did look quite strange but with all his board positions and corporate officer level positions, I can see how these would accumulate. People in key company positions will typically be given, company paid life insurance, but I think there is more to this. In some cases, it looks like he is using some as an investment portfolio diversifier and in other cases, an estate tax strategy. The bottom line is there are many uses for life insurance including, but not limited to estate tax avoidance, tax-free funding of retirement, creating a legacy to pass to heirs or charities, even paying for long-term care.