Best Laid Plans

Well despite my usual optimism about most things I do have to admit I’m a little worried about my best laid plans to retire at 45.  After all my plan calls for a personal inflation rate of 1.5% and an average rate of return of 7%.  So with the CPI closer to 3.5% and my likely return for the year closer to -25%.  It’s a bit hard to see how this going to work out facing the math of any year with -25% return could really screw up an average even over 15 years.

Yet at the same time I have to admit I’m thinking this time period could actually make my retirement plans rather than ruin them.  After all if I can managed to pick up the indexes when they are down and continue to selectively pick certain stocks to buy during the next year or two (or how ever long it takes for things to turn around).  I could end up riding a big wave back up and recover my overall plan.

So rather than worry about which it will be in the end I’m going to keep my mind open.  I’m not going to hide under a shell refusing to invest.  At the same time I’m aware I should keep my investment purchases resonable in the overall context of my own life.  I’m going to keep some cash on hand in case things get bad at my job (which is a bit of cocern of mine).  I’m going to try and walk the middle path, which is often much easier to say rather than to do.

So how about anyone else?  How has the last few months altered (if at all ) your plans to retire?

5 thoughts on “Best Laid Plans”

  1. Don’t get discouraged. Things tend to revert back to the mean. Even if you get a -25% in there, some nice years are likely to follow. Also the point you made about accumulating in low markets is an important one.

  2. Haven’t thought much about retirement but looking into the future I’ve definitely lowered my expectations for returns. Lately I’ve been thinking more about physical health/longevity and being happy in my career…in light of the fact that I may not be able to retire at 50 or 55 (I’m 30 years old).

  3. This mess has set my retirement back at least a year.
    But I’m flexible about when I pull the plug…I’m still in my early 40’s.
    I was expecting some kinda down turn in the markets..but nothing like this.
    I’m gonna wait till things calm down,then see where I’m at.

  4. Losing It,

    Actually that is great idea. Focus on what you can control and work at being happier now.


    I agree. I’m waiting for the bottom to hit and see what the final damage is.


  5. I’m not completely upset about recent developments, retirement is a long way off for me (I’m under 30).

    The major concern for me is to get as much cash as I can into the market. This is when it helps to be frugal. 😉

Comments are closed.