Read? Sequence Risk's Impact on Your Retirement Money
Read? Two Years After Retiring From Full Time Monthly Salary As Employee (2)
Read? How I likely to avoid sequence-of-returns risk from my investment portfolio
Three years have passed over without any sequence of return risks or asset draw-down after retirement from full-time job as employee in Sep 2016.
So far, there is no impact on net worth as cumulative cash in exceeds cumulative cash out.
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Hi Uncle8888,
ReplyDeleteCash shield, yield shield, bond shield.
I think very hard for negative sequence of returns risk to penetrate your triple shields! LOL!
Based on your 3 Taps pie chart, roughly 14% of your total portfolio in risk assets (stocks).
Using SG large caps as proxy for your stocks positions, the maximum drawdowns over past 22 years if 14% Singapore stocks and 86% cash:-
1) -8.6% (GFC)
2) -7.5% (AFC)
3) -4.5% (2015 China / Oil Crisis)
4) -3.1% (Dotcom / SARS, but a long frustrating 3 years of +/- 3% up & down sideways sandpaper grinding)
Do note that all above drawdowns recovered ... but of course take time & patience (which depending on personal circumstances & goals, may or may not have).
Total gains of 85.3% or CAGR of 2.76% over 22 years LOL.
Using Monte Carlo statistical projections for the above 14:86 asset allocation:-
Worst case drawdown (Great Depression style) -- -11.5% (i.e. stocks position almost wiped out!)
Median "big bear" drawdown -- -8.1%
Super kiasi. LoL
DeleteHa!Ha!
Deletei only 4Ks, U super K or Super 4 Ks because your maths is much higher, mine only count with fingers and toes.
Yes in de- accumulation phase, we still have to watch cash in is more than cash out.
If necessary even belt tightening in bad times.
Especially if we want to leave a legacy.
Congratulations!
The only problem is only God knows how we go and at what time.
DeleteFor non-believers, no exceptions. No?
If we know when to go then retirement planning will be simpler
Delete