关于老杨“提前退休的计划” 的看法

In laoyangdelp’s original and response posts, assume she (thought a HE, but it is a SHE) already has $2M in her portfolios, and her LG-self would be able to support their family on one income for the next 20 years without consuming their investment portfolios.

The historical data for S&P 500 showed annual returns of 10-11% for 80, 40, and 20 years period since 1926. 20 year is a long term scenario for investment, average annual returns should be achievable. Let’s assume 10% annual return for SPY, 3% annual inflation, her $2M current portfolio will turn into $2M x (1 + 10%) ^ 20 / (1 + 3%) ^20 = $7.44M of current money. So laoyangdelp will have $7.44M (current money) in her investment accounts in 2027. At that time, 10% of $7.33M will result in $744K return and she can withdraw the yearly gain while still keep the same principal. Does it sound YUMMY? The goal is realistic and doable.

If she is more aggressive and willing to take more risks, she can buy BRKa or BRKb. Warren Buffet already showed his genius investment performance since 1965 with over 21% average annualized return. Maybe he can live another 10-20 years and still keep his superior 20% return, then laoyangdelp will have over $42M current money in her accounts in 20 years. Wow, what a compounding return!

History tells us the stock market is the best way to invest for long term. If you don’t know how to pick particular stocks, just buy the SPY index or BRKa/b. You will not feel regretted 20 years later.

老杨，you can retire and worry free now with your $2M.