Feb 12, 2016

Take a hypothetical investor named George who retired on Jan. 1, 2000, at age 65 with a $1 million all-stock portfolio, and spent $50,000 a year on his RLE, adjusted for inflation. Considering the S&P 500 lost 41.2% in nominal dollars (or 53.4% after inflation) between the day he retired and Feb. 28, 2009, George would have barely $100,000 left of his nest egg by the end of September 2014, with perhaps ten to twenty years to go for him and his wife. Steve and Sinclair review a Wall Street Journal article by former Neuro Surgeon turned financial analyst, William Bernstein. Bernstein developed a formula for calculating the amount of nest egg you need to retire, based on your Residual Living Expenses (RLE). Steve and Sinclair dig into it and more.