What do you estimate total return to be on your investments over the next 20 years

[Iciclehead]

Just doing my financial planning and wondering what the talent on this find board feel are reasonable assumptions for return on capital (stock appreciation, dividends, interest) over the coming 20 years. I am deliberately excluding buying assets (e.g. real estate) as I already have some of that....this is just the money deposited in that great slot machine known as the market.

Presumption is some activity in trading but not at the day trader level (like perhaps less than 25 trades per month on a portfolio of $1.5 Million).

Also presume (and very much so in my case), that this is your only financial lifeline, no pension, no government (I am giving up on those guys ever paying me a nickle). I tend to think then in terms of a balanced portfolio as you would need to eat from it and if went bust 10 years out, you'd be on welfare or sucking out of a brown bag.

Also leave inflation out of your thinking...just total return.

Thanks in advance for your insight and any comments!

Dennis

[pwd72s]

20 years...ha ha ha ha ha ha ha.

Impossible to even guess.

But you might try posting your question on this board. You might be taken seriously.

http://www.bogleheads.org/forum/index.php

[widgeon13]

It's been going down.

Observations: Average Stock Market Return Since 19xx

[fred cook]

Not so much on stocks, but I have a commercial rental property that makes me about 10% per year on a regular basis. I also have some dividend stocks that pay a bit more than 10%. Of course, that is all before taxes!

[red-beard]

Originally Posted by fred cook

Not so much on stocks, but I have a commercial rental property that makes me about 10% per year on a regular basis. I also have some dividend stocks that pay a bit more than 10%. Of course, that is all before taxes!

Yep, the only way to truely get ahead is to own your own business!

[onewhippedpuppy]

Based on historical data you can pretty easily beat 5% with a typical mutual fund.

[Iciclehead]

Originally Posted by pwd72s

20 years...ha ha ha ha ha ha ha.

Impossible to even guess.

But you might try posting your question on this board. You might be taken seriously.

Bogleheads • Index page

Fair enough, I guess I am used to using long term rates in business forecasting (e.g. revenue growth and similar), just wondering what people were using in their personal financial area.

Dennis

[sammyg2]

If I don't average close to 10% over the long haul I get pissed.

[Iciclehead]

Originally Posted by sammyg2

If I don't average close to 10% over the long haul I get pissed.

OK, help me understand what your investment strategy is....right now I am maintaining about even to slightly positive, nothing close to 10%. PM me if you don't want to post on this thread.

Dennis

[tevake]

Originally Posted by sammyg2

If I don't average close to 10% over the long haul I get pissed.

AH ha, I think we now have an answer to the flavor of some of your posts, Hows that quest for the 10% going the last few years?

Cheers Richard

[sammyg2]

Originally Posted by Iciclehead

OK, help me understand what your investment strategy is....right now I am maintaining about even to slightly positive, nothing close to 10%. PM me if you don't want to post on this thread.

Dennis

LOL, nothing too exotic.
Below is from one of my investment accounts, a smaller and less "conservative" account that I play with. (My largest account is very conservative and still is in the 5% range YTD and slightly above that number over a 10 year span).

Personal Rate of Return from 01/01/2012 to 11/12/2012 is 9.2%

Yes we are in a recovery mode this year but historically, well-managed stocks have earned close to 10% on average.

The breakdown of the investments in that account are:


Note that all stocks in this portfolio are in the form of mutual funds with emphasis on small to mid cap stocks in the current environment.

I typically use morningstar ratings and evaluate the prospectus of each fund before investing and average about 1 move per month. I look at average rate of return, risk, type of investments, fees, etc. and how it performs long-term vs. the S&P and pier group funds.

I also follow the adage, if it looks to good to be true it is.
Some funds perform significantly better than their pier group and I usually steer away from them, too fishy.

If you want to speak to specific mutual funds I like we can do that in private.

[sammyg2]

Originally Posted by tevake

AH ha, I think we now have an answer to the flavor of some of your posts, Hows that quest for the 10% going the last few years?

Cheers Richard

I've done very well in the stock market over the past few years, thank you for asking.
Of course anyone who has kept up with the pace of any of the major indexes has done just as well, and it doesn't take a sooper-genius to do that.

3 years ago the dow was just over 10,000, what's it now, 12,850? (^23%)
The S&P was at 1100 3 years ago, it's threatening to hit 1400 now (^22%)

From the middle of 2008 to the 2nd quater 2009 I didn't do so well, but bailed on allot of stocks and went into safe haven and cut some of those losses.
I didn't get back in at the opportune time as I wasn't that confident, but still managed to ride up most of the swell.
By picking some more aggressive funds during the upswing it wasn't hard to outperform the average.

[RWebb]

the length of the redaction blots indicates fairly small numbers...

be sure to think about returns post-inflation, BTW