Skip to main content

What About 100% Growth Funds For Retirement

We could withdraw 4% from SPY and not be broke in almost every situation based on historaical SPY price and dividend data since 1993. And since growth funds such as IWF, VRGWX and SPYG beat SPY about 80% of the times, I wonder if I can keep a 100% growth portfolio as retirement funds. Is it safe if I withdraw 4% every year from it?

I have built this tool for comparison withdrawing funds from SPY and IWF.

APP

Tax Rate on Dividends: %.
Withdrawal Freqhency:
Withdrawal Rate: %.
Initaial Portfolio Value: $.
Retirement Date:.

Simulate 100 Times

Retired Right Before 2000 Financial Crisis

Withdrawing 4.83% from a total IWF portfolio leave me about broke now. SPY does a lot better.

Retired Right Before 2000 Financial Crisis

Withdrawing 11% from a total IWF portfolio leave me about broke now, which is a little better than SPY.

Conclusion

It is quite dangerous keeping a total growth fund for retirement.
Labels:

Comments

Post a Comment

Popular posts from this blog

Which Asset Class Had the Best Performance During the 2008 Financial Crisis?

In this article, I want to explore which asset, ETFs, MFs, Stocks, did best during the 2008 financial crisis. I will compare the investment results against the result of SPY, since it represents the overall market. The scenario is investing right at the highest point of S&P 500 index right before it crashed during the crisis. The date is Oct 9, 2007  when the index reached 1,565.15. I will compare the returns of each asset against SPY in the following order: Investing until the bottom of the crisis at 676.53 on Mar 09, 2009 in order to simulate downside risk. Investing until the S&P 500 index closed above the previous high at 1,568.61 on Apr 09, 2013 in order to simulate recover ability. Investing until the bottom of the Covid crisis at 2,304.92 on Mar 20, 2020 in order to simulate a series of market crashes. Performance By Ranks Oct 9, 2007 to Mar 09, 2009 SHY  return is 8.848% AGG  return is 7.390% LQD  return is -6.793% HYG  return i...
Post a Comment
Read more