Thank you. I love data and analysis like this. Reducing variables and focusing on what matters most!OP,Wow thank you for the Monte Carlo simulation. That’s a very thorough analysis. I appreciate you running that for me. It definitely helps with some of my assumptions. Currently I am all vanguard funds utilizing a simple portfolio…VTSAX, VTIAX, VBTLX, VTWAX. I am 83% stock, 17% bonds + cash and 19% of my equities are international
A) I disagreed with the previous analysis that you have a more aggressive asset allocation. That is not going to help you enough. In fact, I believe your asset allocation is too aggressive. It should be 70/30.
B) I agreed that higher saving rate should helps.
Starting with 1.711 million and saving 75K per year.
With an average annual return of 5%, you can reach 4 million in 11 years.
With an average annual return of 7%, you can reach 4 million in 10 years.
The difference of annual return rate of 2%, it only changes 1 year.
Starting Net Worth$1,711,000
Annual Savings$75,000
Years
Annual Return Rate7891011
5.00%$3,018,199 $3,244,109 $3,481,315 $3,730,381 $3,991,900
6.00%$3,202,249 $3,469,384 $3,752,547 $4,052,700 $4,370,862
7.00%$3,396,544 $3,709,302 $4,043,953 $4,402,030 $4,785,172
Starting with 1.711 million and saving 85K per year.
With an average annual return of 5%, you can reach 4 million in 10+ years.
With an average annual return of 7%, you can reach 4 million in 8+ years.
Starting Net Worth$1,711,000
Annual Savings$85,000
Years
Annual Return Rate7891011
5.00%$3,099,620 $3,339,601 $3,591,581 $3,856,160 $4,133,968
6.00%$3,286,188 $3,568,359 $3,867,460 $4,184,508 $4,520,578
7.00%$3,483,084 $3,811,900 $4,163,733 $4,540,194 $4,943,008
Saving 10K more per year makes a lot more difference.
https://investor.vanguard.com/investor- ... allocation
Average annual return of 70/30 is 9.1%
Average annual return of 80/20 is 9.5%
Average annual return of 90/10 is 9.9%
You only have 10 more years to go. Not enough time for an aggressive AA to helps you. But, short enough for a downturn to hurt you.
KlangFool
Statistics: Posted by TarHeel2002 — Sun Jul 21, 2024 12:56 pm — Replies 12 — Views 1629