Dodging Mediocre Retirement Investing

Some general market analysis from Research Affiliates that I completely agree with:

“It doesn’t seem like much to ask for–a 5 percent return. But the odds of making even that on traditional investments in the next 10 years are slim. Research Affiliates looked at the default settings of 11 retirement calculators, robo-advisors, and surveys of institutional investors. Their average annualized long-term expected return? It was 6.2 percent…One message that John West, head of client strategies at Research Affiliates and a co-author of the report, hopes that people will take away is that the high returns of the past came with a price: lower returns in the future.”

Yes. Yes. A thousand times yes.

When you see your net worth in an investment increase by an amount that is greater than the earnings growth and dividend payments borne out by the business, it can only mean one of two things. The … Read the rest of this article!