Stock investments are no-one way street. Plus you cannot live on dividends. You literally assumed that going 100% stocks in a S&P index fund is a sureway street to financial freedom:
![[Image: 9e341dad02f1d5be0cf6b5f9c8296cc8.png]](https://media.ycharts.com/charts/9e341dad02f1d5be0cf6b5f9c8296cc8.png)
If you had pumped everything into the market in 1999, then you would have made a cool minus after 10 years (even index-funds cost some cash to operate). Sure - then you would have made 30% 8 years later.
Pumping everything into the stock market and calculating your net earnings of 8% from 2000 to 2018 should have made a 400% return according to such blanket statements. Any semi-savvy investor or trader knows the weakness of such statements.
There are some guys who have retired with 500.000$ and a frugal lifestyle, while pulling 80-90% of their cash into some low-risk bonds and funds, at best putting some in more risky investments like S&P500 - an investment that might net you zero after 15 years. But those things are usually done by individuals who have accumulated the money and have learned to live frugally.
That is why some lotteries have begun to give their winners monthly payouts in contrast to big lump sums.
Obviously there are countries in the world where a guy can move with 600k and live off a local savings account - worst case move elsewhere when it becomes too expensive.
So no - withdrawing 50k per year on 600k in net assets is no viable option unless you are quite competent at that or you are lucky and have some good years. But even then - it's mostly based on lack of awareness and competence regarding the risk/reward structure. That is shown by the way in the very fact of recommending someone to pump 100% into an S&P500 fund.
I would not even recommend that to that young man. There are better avenues for that depending on his personal expertise and risk-tolerance.
Looking at that woman I simply made an educated guess about her likely future behavioral pattern with regard to money and investment. Sure - it's possible that she goes and lives frugally from this time on, but in that case 600k will be enough anyway for the remainder of her life.
If you had pumped everything into the market in 1999, then you would have made a cool minus after 10 years (even index-funds cost some cash to operate). Sure - then you would have made 30% 8 years later.
Pumping everything into the stock market and calculating your net earnings of 8% from 2000 to 2018 should have made a 400% return according to such blanket statements. Any semi-savvy investor or trader knows the weakness of such statements.
There are some guys who have retired with 500.000$ and a frugal lifestyle, while pulling 80-90% of their cash into some low-risk bonds and funds, at best putting some in more risky investments like S&P500 - an investment that might net you zero after 15 years. But those things are usually done by individuals who have accumulated the money and have learned to live frugally.
That is why some lotteries have begun to give their winners monthly payouts in contrast to big lump sums.
Obviously there are countries in the world where a guy can move with 600k and live off a local savings account - worst case move elsewhere when it becomes too expensive.
So no - withdrawing 50k per year on 600k in net assets is no viable option unless you are quite competent at that or you are lucky and have some good years. But even then - it's mostly based on lack of awareness and competence regarding the risk/reward structure. That is shown by the way in the very fact of recommending someone to pump 100% into an S&P500 fund.
I would not even recommend that to that young man. There are better avenues for that depending on his personal expertise and risk-tolerance.
Looking at that woman I simply made an educated guess about her likely future behavioral pattern with regard to money and investment. Sure - it's possible that she goes and lives frugally from this time on, but in that case 600k will be enough anyway for the remainder of her life.