The 4% Rule is not as good as we hoped – Part 2: Bond expected returns

Part 2 of our multi-part series deals with bond returns. During the 1871 to 2016 time span, 10 year government bonds returned over 2% in real terms. It’s hard to see how bonds can continue that trend in the foreseeable future. Continue reading “The 4% Rule is not as good as we hoped – Part 2: Bond expected returns”


Pros and cons of different withdrawal rate rules

Update Dec 7, 2016: Check our new series on safe withdrawal rates: The Ultimate Guide to Safe Withdrawal Rates – Part 1: Introduction

Look around in the early retirement community and everybody is raving about the 4% rule. It’s a “safe” withdrawal rate, we are told, by the Trinity Study and some in the early retirement community. Some claims, we found, are downright false but more on that later. Continue reading “Pros and cons of different withdrawal rate rules”

The ABC (and D through J) of Early Retirement

Retirement is too important to not have a comprehensive plan about what to do if – God forbid – something were to go wrong. Here is our Plan A, as well as our Plans B, C, D, all the way through Plan J. Just in case!

Continue reading “The ABC (and D through J) of Early Retirement”

Why we don’t use Robo-advisers

  1. Most investors will get much smaller excess returns from the tax savings than what the Robo-advisers claim.
  2. Robo-advisers pick an asset allocation that may have tax inefficiencies built in for some investors, worth at least several basis points of annualized returns.
  3. Smart investors should still perform Tax Loss Harvesting, but it’s best to DIY because the benefits may not outweigh the Robo-adviser fees, especially if taking into account some of the potential inefficiencies introduced in the Robo-adviser target portfolios.


In our earlier post we showed how to be your own DIY Robo adviser. That post got quite long and even then it didn’t deal with all the issues of Robo advisers and especially tax loss harvesting (TLH). Here are some additional thoughts and caveats about TLH, Robo-advisers and their – in our opinion – slightly “creative” marketing practices. Continue reading “Why we don’t use Robo-advisers”