Vanguard execs: Stock investors will be stepping off the gas for years to come

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psh
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Vanguard execs: Stock investors will be stepping off the gas for years to come

Post by psh »

https://m.startribune.com/vanguard-exec ... 600138460/

Should I be concerned? I’m mainly invested in VTSAX for the next 15-20 yrs.
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Re: Vanguard execs: Stock investors will be stepping off the gas for years to come

Post by Orangutan »

Ignore. I used to get really into these predictions, read 30 pages of Bogleheads arguing about future returns, and now realize it was a huge waste of time. Just keep dumping into VTSAX/your AA.
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Re: Vanguard execs: Stock investors will be stepping off the gas for years to come

Post by TropikThunder »

psh wrote: Sun Jan 23, 2022 2:22 am https://m.startribune.com/vanguard-exec ... 600138460/

Should I be concerned? I’m mainly invested in VTSAX for the next 15-20 yrs.
What does "stepping off the gas" even mean? My car goes faster when I step on the gas because I want it to go faster (much faster some times :P ). Cause and effect. Stocks don't go up because investors want them to, so desire has nothing to do with it.
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Re: Vanguard execs: Stock investors will be stepping off the gas for years to come

Post by Ed 2 »

psh wrote: Sun Jan 23, 2022 2:22 am https://m.startribune.com/vanguard-exec ... 600138460/

Should I be concerned? I’m mainly invested in VTSAX for the next 15-20 yrs.
I like Tim , but it’s his job as Captain of the ship to do some risk management at Vanguard. I was for years amused and asking myself why Vanguard and other firms even trying to predict what coming next year or years after. Anyway, part of Vanguard management to lower expectations, that’s what they do and done.
Should you be concerned? It’s all about your risk tolerance. I almost 52 am not, I just bought a boatload of International index ( IXUS) on Friday right before close. My biggest holdings still VTSAX . Should I be concerned? Not in my lifetime. My biggest concern is taking care my health , that is why I do routinely, I exercise .
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Re: Vanguard execs: Stock investors will be stepping off the gas for years to come

Post by Wiggums »

He has a 50/50 chance of being right. Didn’t they also recommend a bigger stake in international funds? I’m sticking with my three fund portfolio and AA.
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Re: Vanguard execs: Stock investors will be stepping off the gas for years to come

Post by nisiprius »

It's noise. Tune out the noise.

You should have accepted the fact that stocks are risky, even over holding periods of 15-20 years. If you haven't, you need to.

Having done that, it has always been the case, at any point in time, that even if you restrict yourself to people you respect and feel are credible, some will be anticipating high stock returns, some will be anticipating low returns, some will say stocks are "overvalued" (whatever that means) and others that stocks are "undervalued." You can't know who will be right. The article talks about a 7.5% "Wall Street consensus," but there's no evidence that you can predict the future from a "consensus" of experts. (How would you decide whom to include in that "consensus?")

Now, Vanguard has published a paper on the economic and market outlook. Their central numbers got a fair amount of press attention when it came out, yet few reporters bothered to say anything about the range:

Image

When Buckley talks about "2-4%," you can see that 4% is just about the center of the forecast for "U.S. large cap." But you can also see that 2% is within the likely, green range, and so is the 7.5% "consensus" number.

Furthermore, the entire range is from -2% up to 12%. Even if you believe that Vanguard's models are absolutely correct--which is nonsense--they are not saying "the model forecasts 4%." They are saying "the model tested a range of possibilities, and it almost always came out somewhere between -2% and +12%."

So that is what we should be using as our mental planning number. On the average, over the next ten years, our stocks very well could lose an average of -2%/year, or gain +12% or year, and have about a coin-flip chance of being outside the range 2% to 7%.

That is the kind of uncertainty stock investors need to face.

Think "I'll probably get somewhere between -2% and +12%." And then you can ignore anyone bloviating on whether the real number will turn out to be 3% or 7%.
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Re: Vanguard execs: Stock investors will be stepping off the gas for years to come

Post by JoeRetire »

psh wrote: Sun Jan 23, 2022 2:22 am Should I be concerned? I’m mainly invested in VTSAX for the next 15-20 yrs.
Be concerned if you want to. But what good does that do you?

Will you choose not to be mainly invested in VTSAX for the next 15-20 yrs?
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Re: Vanguard execs: Stock investors will be stepping off the gas for years to come

Post by Sandtrap »

psh wrote: Sun Jan 23, 2022 2:22 am https://m.startribune.com/vanguard-exec ... 600138460/

Should I be concerned? I’m mainly invested in VTSAX for the next 15-20 yrs.
The flavor of the Kool-Aid and the color of the swimming pool water doesn’t change anything except emotional reaction, fear level, comfort zone, or cognitive bias. Yet, data, news, and input continues to heavily influence human behavior.

Remember: “When E.F Hutton talks….Everybody Listens”?

Ignore the noise.
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Re: Vanguard execs: Stock investors will be stepping off the gas for years to come

Post by vtsnowdin »

TropikThunder wrote: Sun Jan 23, 2022 3:45 am
psh wrote: Sun Jan 23, 2022 2:22 am https://m.startribune.com/vanguard-exec ... 600138460/

Should I be concerned? I’m mainly invested in VTSAX for the next 15-20 yrs.
What does "stepping off the gas" even mean? My car goes faster when I step on the gas because I want it to go faster (much faster some times :P ). Cause and effect. Stocks don't go up because investors want them to, so desire has nothing to do with it.
You are quite wrong on that. When the market is going up investors as a group become over confident and put money into stocks that have already gone up as much as the companies balance sheets justify and that pushes the price up by a "Speculation factor" on the Hope that it will rise further. Stocks went up because a lot of people wanted them to and bet on it. Then when a down turn comes people become discouraged and stop putting new money in and even sell at a loss to pull money out completing the buy high and sell low cycle.
Fund managers are just people that play with a bigger pile of other peoples chips and the average manager is just that "Average" and they as a group will also buy high and sell low partly because clients are giving them money when it is going up and withdrawing money when it is going down.
Stepping off the gas just means people will be sending in less new money to the managers for a while and some will want whats left of their money back.
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Re: Vanguard execs: Stock investors will be stepping off the gas for years to come

Post by anon_investor »

psh wrote: Sun Jan 23, 2022 2:22 am https://m.startribune.com/vanguard-exec ... 600138460/

Should I be concerned? I’m mainly invested in VTSAX for the next 15-20 yrs.
No. These guys have been so wrong so often. Just look at their past track record.
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Re: Vanguard execs: Stock investors will be stepping off the gas for years to come

Post by Yarlonkol12 »

From a mathematical perspective, you should be hoping they are right, assuming you want to work and invest for another 20 years
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Re: Vanguard execs: Stock investors will be stepping off the gas for years to come

Post by JoMoney »

I don't mind if stock investors take their foot off the pedal, just keep a safe distance from crashing, and don't hit the brakes ;)
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Re: Vanguard execs: Stock investors will be stepping off the gas for years to come

Post by anon_investor »

JoMoney wrote: Sun Jan 23, 2022 7:49 am I don't mind if stock investors take their foot off the pedal, just keep a safe distance from crashing, and don't hit the brakes ;)
A crash is not the end of the world. Just don't panic.
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Re: Vanguard execs: Stock investors will be stepping off the gas for years to come

Post by JoMoney »

anon_investor wrote: Sun Jan 23, 2022 7:58 am
JoMoney wrote: Sun Jan 23, 2022 7:49 am I don't mind if stock investors take their foot off the pedal, just keep a safe distance from crashing, and don't hit the brakes ;)
A crash is not the end of the world. Just don't panic.
Given the choice, a 5 MPH fender bender is better than a 5 car freeway pile-up.
In either case "panic" isn't helpful to avoid the situation nor changing anything after the fact, so.. agree :beer
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Re: Vanguard execs: Stock investors will be stepping off the gas for years to come

Post by tvubpwcisla »

A guy in a suit that works at Vanguard can predict future returns no more accurate than your neighbor down the street.

Search for black swan event on Google.
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Re: Vanguard execs: Stock investors will be stepping off the gas for years to come

Post by markjk »

psh wrote: Sun Jan 23, 2022 2:22 am https://m.startribune.com/vanguard-exec ... 600138460/

Should I be concerned? I’m mainly invested in VTSAX for the next 15-20 yrs.
Nah, I wouldn't be concerned. The truth is you won't know if any of these predictions are correct until it's too late to take action on the information. Most predictions are wrong anyway when you look back. Set your AA and stick with it through the ups and downs. History says if you do that, you'll put yourself in the best position to succeed long term.

The same prediction came from Vanguard in January of 2020. The last two years were great. So, you have a recent real example right there where a prediction was wrong.

There might be some truth to a longer term (in aggregate) pull back in stock appreciation when looking at current valuation metrics. But even those aren't full proof indicators.
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Re: Vanguard execs: Stock investors will be stepping off the gas for years to come

Post by anon_investor »

JoMoney wrote: Sun Jan 23, 2022 8:03 am
anon_investor wrote: Sun Jan 23, 2022 7:58 am
JoMoney wrote: Sun Jan 23, 2022 7:49 am I don't mind if stock investors take their foot off the pedal, just keep a safe distance from crashing, and don't hit the brakes ;)
A crash is not the end of the world. Just don't panic.
Given the choice, a 5 MPH fender bender is better than a 5 car freeway pile-up.
In either case "panic" isn't helpful to avoid the situation nor changing anything after the fact, so.. agree :beer
If the stock market only played that nicely.
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Re: Vanguard execs: Stock investors will be stepping off the gas for years to come

Post by Svensk Anga »

markjk wrote: Sun Jan 23, 2022 8:04 am

The same prediction came from Vanguard in January of 2020. The last two years were great. So, you have a recent real example right there where a prediction was wrong.
No, it is not yet proven wrong. Vanguard's market predictions are for 10-year returns. They do not do short term forecasting. You cannot know that the 2020 prediction was wrong until 2030.
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Re: Vanguard execs: Stock investors will be stepping off the gas for years to come

Post by BitTooAggressive »

psh wrote: Sun Jan 23, 2022 2:22 am https://m.startribune.com/vanguard-exec ... 600138460/

Should I be concerned? I’m mainly invested in VTSAX for the next 15-20 yrs.
Yes you should be concerned, but not because of that. I think you should diversify your equity position beyond VTSAX. It is my largest holding, probably 35% of my equity holdings, but you should consider international, and larger positions in small and mid cap than the total market IMO. We don’t know which equity subclass will do better the next 40 years but I suspect each of the above will all have their day in the sun and times when they don’t do well.
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Re: Vanguard execs: Stock investors will be stepping off the gas for years to come

Post by nisiprius »

Svensk Anga wrote: Sun Jan 23, 2022 9:33 am
markjk wrote: Sun Jan 23, 2022 8:04 am

The same prediction came from Vanguard in January of 2020. The last two years were great. So, you have a recent real example right there where a prediction was wrong.
No, it is not yet proven wrong. Vanguard's market predictions are for 10-year returns. They do not do short term forecasting. You cannot know that the 2020 prediction was wrong until 2030.
More important, their forecast is for a range, not a single point. In 2030 we could see an average return of 1% or an average return of 10%, and their prediction would still not be wrong because both are within the range of possible outcomes predicted by the Vanguard Capital Markets model. See above.
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Re: Vanguard execs: Stock investors will be stepping off the gas for years to come

Post by nedsaid »

The Vanguard forecast tells me that a Global Equity Portfolio will be just fine. If you take this forecast seriously, Vanguard is saying that Global diversification is important. Also there is a clear implication that diversification across factors, that is tilting towards Small and Value might well add to portfolio diversification. Even REITs offer diversification benefits relative to U.S. Large Growth.

Of course, this is just a forecast and we all know that in the shorter run that almost anything can happen. It does make sense in that hot asset classes tend to cool off and that valuations matter, there is sort of a reversion to the mean. I don't see this as a doom and gloom prediction.
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Re: Vanguard execs: Stock investors will be stepping off the gas for years to come

Post by abuss368 »

Ed 2 wrote: Sun Jan 23, 2022 4:25 am
psh wrote: Sun Jan 23, 2022 2:22 am https://m.startribune.com/vanguard-exec ... 600138460/

Should I be concerned? I’m mainly invested in VTSAX for the next 15-20 yrs.
I like Tim , but it’s his job as Captain of the ship to do some risk management at Vanguard. I was for years amused and asking myself why Vanguard and other firms even trying to predict what coming next year or years after. Anyway, part of Vanguard management to lower expectations, that’s what they do and done.
Should you be concerned? It’s all about your risk tolerance. I almost 52 am not, I just bought a boatload of International index ( IXUS) on Friday right before close. My biggest holdings still VTSAX . Should I be concerned? Not in my lifetime. My biggest concern is taking care my health , that is why I do routinely, I exercise .
“ Nobody knows nothing “ Jack Bogle.
^ this is so well said! Puts priorities in perspective. Others would be wise to follow.

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Re: Vanguard execs: Stock investors will be stepping off the gas for years to come

Post by Ed 2 »

abuss368 wrote: Sun Jan 23, 2022 11:31 am
Ed 2 wrote: Sun Jan 23, 2022 4:25 am
psh wrote: Sun Jan 23, 2022 2:22 am https://m.startribune.com/vanguard-exec ... 600138460/

Should I be concerned? I’m mainly invested in VTSAX for the next 15-20 yrs.
I like Tim , but it’s his job as Captain of the ship to do some risk management at Vanguard. I was for years amused and asking myself why Vanguard and other firms even trying to predict what coming next year or years after. Anyway, part of Vanguard management to lower expectations, that’s what they do and done.
Should you be concerned? It’s all about your risk tolerance. I almost 52 am not, I just bought a boatload of International index ( IXUS) on Friday right before close. My biggest holdings still VTSAX . Should I be concerned? Not in my lifetime. My biggest concern is taking care my health , that is why I do routinely, I exercise .
“ Nobody knows nothing “ Jack Bogle.
^ this is so well said! Puts priorities in perspective. Others would be wise to follow.

Tony
Thanks. Wisdom comes with age I guess. Experience too.
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Re: Vanguard execs: Stock investors will be stepping off the gas for years to come

Post by beernutz »

psh wrote: Sun Jan 23, 2022 2:22 am https://m.startribune.com/vanguard-exec ... 600138460/

Should I be concerned? I’m mainly invested in VTSAX for the next 15-20 yrs.
If these people could accurately predict the future why are they working at all?
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Re: Vanguard execs: Stock investors will be stepping off the gas for years to come

Post by csmath »

Svensk Anga wrote: Sun Jan 23, 2022 9:33 am
markjk wrote: Sun Jan 23, 2022 8:04 am

The same prediction came from Vanguard in January of 2020. The last two years were great. So, you have a recent real example right there where a prediction was wrong.
No, it is not yet proven wrong. Vanguard's market predictions are for 10-year returns. They do not do short term forecasting. You cannot know that the 2020 prediction was wrong until 2030.
But some of the ones I dug up are going to start playing out soon!
csmath wrote: Mon Dec 07, 2020 9:30 pm Just because I was curious... then I got bored.

Vanguard January 2013: https://www.tmag2.com/documentlibrary/1 ... 142013.pdf
The expected return differential between U.S. and non-U.S. equity portfolios is not statistically significant
Vanguard 2014: https://static.fmgsuite.com/media/docum ... b23cb3.pdf
the long-term median expected return for U.S. equity versus global ex-U.S. equity in Figure III-8may suggest that the expected U.S. equity market return may undercut both its own historical average and the expected global ex-U.S. equity return.
Vanguard 2015: https://silo.tips/download/vanguard-res ... ber-2015-2
The expected return outlook for non-U.S. equity markets is modestly higher from a U.S. investor’s perspective
Vanguard 2016: https://global.vanguard.com/documents/2 ... ook-ch.pdf
As a consequence of this strong past performance, our outlook for global equities remains guarded, in the 5%–8% range
Vanguard 2017: https://pressroom.vanguard.com/nonindex ... r-2017.pdf
Expected returns for the U.S. stock market are lower than those for international markets
Vanguard 2018: https://global.vanguard.com/documents/i ... 018-eu.pdf
Expected returns for the US stock market are lower than those for international markets
Vanguard 2019: https://pressroom.vanguard.com/nonindex ... 120618.pdf
Expected returns for the U.S. stock market are lower than those for international markets
Vanguard 2020: https://pressroom.vanguard.com/nonindex ... k_2020.pdf
the expected return outlook for non-U.S. equity markets is in the 6.5%–8.5% range, higher than that of U.S. equity
Edit to add: I'm not trying to make any points here. I was just curious what was said in the past and started snooping. Figured I'd share what I found.
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Re: Vanguard execs: Stock investors will be stepping off the gas for years to come

Post by jeffh19 »

Ignore. I think for the past 3-5+ years Vanguard has predicted low stock market returns, especially in the US, predicting international would outperform the US. IIRC they predicted like 3-5% returns from the US stock market over the next decade or so, and that was a few years ago.

We've gotten what, around 20-30% returns 5/6 years in a row sans 2018? International has certainly underperformed domestic as well.

Nobody knows anything. Maybe there will be stepping off the gas...?? I could argue otherwise, but if we are talking in metaphors, maybe we are stepping off the gas, but if we were going 150mph when stepping off the gas, maybe we slow down to 100, or maybe we don't need the gas because we are going down hill or whatever lol
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Re: Vanguard execs: Stock investors will be stepping off the gas for years to come

Post by am »

Wonder if these predictions are designed to provide more business for their advisory division? Average investor may think that if future returns are poor, than an advisor will be useful. I don’t see why they would put these predictions out year after year otherwise? Follow the money.
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Re: Vanguard execs: Stock investors will be stepping off the gas for years to come

Post by GaryA505 »

I'm going to predict that if I eat too much beans I'll get gas, and I'll wager that it is a much better prediction than the Vanguard execs can make.
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Re: Vanguard execs: Stock investors will be stepping off the gas for years to come

Post by Ed 2 »

GaryA505 wrote: Sun Jan 23, 2022 1:10 pm I'm going to predict that if I eat too much beans I'll get gas, and I'll wager that it is a much better prediction than the Vanguard execs can make.
They’ve been way off with their predictions and asset allocation recommendations like past 10 years already, I guess your prediction probably more accurate and scientifically proven.
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Re: Vanguard execs: Stock investors will be stepping off the gas for years to come

Post by CyclingDuo »

psh wrote: Sun Jan 23, 2022 2:22 am https://m.startribune.com/vanguard-exec ... 600138460/

Should I be concerned? I’m mainly invested in VTSAX for the next 15-20 yrs.
Ignore the noise!

:sharebeer

I think it makes more sense to keep your foot firmly on the gas pedal for each and every year throughout your decades of working. You do not get to pick and choose your birthdate, death date, and for the most part - the decades that you work. If your time is "now" regarding your working career, I cannot imagine keeping the foot off the gas by investing a portion of your income from human capital each and every month/year throughout your working decades. You get what the market returns to you during your 30-40 years of working as you contribute a portion of your income each and every month into it.

Through thick and thin, just maxing out your 401k in the S&P 500 and not even counting the employer match, has been a return worthy of your discipline from 1988 to 2022 (chart below will most likely be updated by the author to include 2021 at some point). 1988 to 2022 includes all the drawdowns the market has experienced along the way, and there have been 28 (including the current drawdown we are in). If you want to count the drawdowns and see their severity with regard to the S&P 500, you can view them here: https://www.yardeni.com/pub/sp500corrbear.pdf

Here is the 401k (or 403b, or 457b) maxing out at the under age 50 contribution rate in the S&P 500 for one who has been working and doing that throughout their three decade career and change to date...

Image
https://retireby40.org/what-if-always-maxed-401k/

This year, the maximum contribution bumps up to $20,500 for those under age 50 and up to $27,000 for those age 50 and over. Add in the company match, plus other savings in Roth IRA, taxable, etc... - why would one want to take their foot off the gas? Returns will be what they are going to be over the next decade(s). I'm all for participation, or keeping the foot on the gas. Choose your AA and keep burning gas on the journey to arrive at your destination.

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Re: Vanguard execs: Stock investors will be stepping off the gas for years to come

Post by LadyGeek »

This thread is now in the Investing - Theory, News & General forum (general discussion).
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Re: Vanguard execs: Stock investors will be stepping off the gas for years to come

Post by AnnetteLouisan »

How are stock futures looking tomorrow? Btw it’s a great time to learn to meditate.
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Re: Vanguard execs: Stock investors will be stepping off the gas for years to come

Post by AnnetteLouisan »

CyclingDuo wrote: Sun Jan 23, 2022 1:31 pm
psh wrote: Sun Jan 23, 2022 2:22 am https://m.startribune.com/vanguard-exec ... 600138460/

Should I be concerned? I’m mainly invested in VTSAX for the next 15-20 yrs.
Ignore the noise!

:sharebeer

I think it makes more sense to keep your foot firmly on the gas pedal for each and every year throughout your decades of working. You do not get to pick and choose your birthdate, death date, and for the most part - the decades that you work. If your time is "now" regarding your working career, I cannot imagine keeping the foot off the gas by investing a portion of your income from human capital each and every month/year throughout your working decades. You get what the market returns to you during your 30-40 years of working as you contribute a portion of your income each and every month into it.

Through thick and thin, just maxing out your 401k in the S&P 500 and not even counting the employer match, has been a return worthy of your discipline from 1988 to 2022 (chart below will most likely be updated by the author to include 2021 at some point). 1988 to 2022 includes all the drawdowns the market has experienced along the way, and there have been 28 (including the current drawdown we are in). If you want to count the drawdowns and see their severity with regard to the S&P 500, you can view them here: https://www.yardeni.com/pub/sp500corrbear.pdf

Here is the 401k (or 403b, or 457b) maxing out at the under age 50 contribution rate in the S&P 500 for one who has been working and doing that throughout their three decade career and change to date...

Image
https://retireby40.org/what-if-always-maxed-401k/

This year, the maximum contribution bumps up to $20,500 for those under age 50 and up to $27,000 for those age 50 and over. Add in the company match, plus other savings in Roth IRA, taxable, etc... - why would one want to take their foot off the gas? Returns will be what they are going to be over the next decade(s). I'm all for participation, or keeping the foot on the gas. Choose your AA and keep burning gas on the journey to arrive at your destination.

CyclingDuo
You’re eligible for the 401k catch up immediately in the calendar year in which you turn 50 - so, now even if your bday isn’t until Dec. Nota bene!
Elysium
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Re: Vanguard execs: Stock investors will be stepping off the gas for years to come

Post by Elysium »

Folks keep forgetting on these threads one thing, the S&P 500 has already returned 26% annualized per annum since 2019, and many including Vanguard were forecasting lower returns ranging in the 6%-7% range for US large at the end of 2018. It is not impossible to get to that level over the next 7 years, if the US S&P 500 had a couple of years of losses with -20% to -15% range, followed by returns in the +15% to +20% range in the other years. Just a quick plug of the numbers on my returns calc excel tells me a series of returns that goes like that will easily end up with 5% to 6% average ending 2028 and starting 2019, and it could easily return about 2% to 3% average for 2022-2028 with a couple of negative years like we had in 2000-2002 followed by stellar years in 2003-2007, so it isn't inconceivable at all.

Why are folks getting all riled up against the forecasters? sure, they don't have crystal balls and they are providing a wide range. But the base case they are projecting is very much in the realm of normal stock market behavior that we should expect. Why is there a problem accepting that. We've already had 3 outstanding years, and in order to get to the averages, we're likely to have a few negative years. That's the way it works. We do not need the market to drop 50% or even 40%, just a sequence of returns in the low double digits that are both positive and negative alternatively, in fact more positive years than negative will still get us there.

We need to go back and run our own estimates on where we wanted to be in 10 years, 3 years before. My own calculations were based on modest average returns of 5% to 6% at beginning of 2019, and if end up getting "only" there in the next 7 years, I am still going to be fine. We cannot move our goalpost by start expecting higher average returns after we've had a couple of outsized years. But we can mitigate risk by looking at the figures having exceed expectations.
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markjk
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Re: Vanguard execs: Stock investors will be stepping off the gas for years to come

Post by markjk »

Svensk Anga wrote: Sun Jan 23, 2022 9:33 am
markjk wrote: Sun Jan 23, 2022 8:04 am

The same prediction came from Vanguard in January of 2020. The last two years were great. So, you have a recent real example right there where a prediction was wrong.
No, it is not yet proven wrong. Vanguard's market predictions are for 10-year returns. They do not do short term forecasting. You cannot know that the 2020 prediction was wrong until 2030.
If you made an adjustment in 2020 due to the 10 year projection and rotated out of stocks, it was a problem for you the past few years. I think that is the point. I certainly understand what you are saying about the 10 full years.

If you go back to 2011, you have your full 10 years. They were quite a bit off. Projecting a 6 - 9% equity return over 10 years when the return was really closer to 15%. Was that a good, actionable projection? I don't know. Maybe.
https://personal.vanguard.com/pdf/s289.pdf

I'm not knocking Vanguard. What does all of this discussion really boil down to? For me, it's just stick to your AA and ignore all of the noise and the projections. They tend to hurt more than help. No one can predict something like stock/bond returns when there are so many variable factors that come into play. It's good reading, and I use it as information, but making any adjustments based on projections can be very risky.
Hofburg43
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Re: Vanguard execs: Stock investors will be stepping off the gas for years to come

Post by Hofburg43 »

I really hate headlines such as this.

First, what does the Minneapolis Star Tribune know about anything, much less investing and how to cover markets?

Second, as a low cost index fund investor, I don't have gas or gas pedals or any other automotive-related equipment.

Metaphors, similies and idioms are great for fiction, poetry and emotive language, etc.

Really bad for money matters.

Third, "stock investors" is a category so broad as to be meaningless.

I plan on doing as always, putting money into VSTAX on a regular basis as long as I have some to do so.

I also question the CEO of Vanguard doing road shows. What is the purpose? I know Fidelity has to, Abigail Johnson needs a new LVMH handbag every so often.
My lifetime requirement for investment advice was satisfied upon reading Jack Bogle write that most people need only a low cost S&P 500 Index fund.
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Toons
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Re: Vanguard execs: Stock investors will be stepping off the gas for years to come

Post by Toons »

Great
Keep Investing
:happy
"One does not accumulate but eliminate. It is not daily increase but daily decrease. The height of cultivation always runs to simplicity" –Bruce Lee
sycamore
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Re: Vanguard execs: Stock investors will be stepping off the gas for years to come

Post by sycamore »

Hofburg43 wrote: Mon Jan 24, 2022 1:44 pm First, what does the Minneapolis Star Tribune know about anything, much less investing and how to cover markets?
Just to clarify, the Star Tribune didn't write the article, they just published it -- the byline says "By ERIN ARVEDLUND , PHILADELPHIA INQUIRER".

Being in Vanguard's backyard, the Inquirer publishes numerous stories on Vanguard. Not that that means they know anything either :)
GaryA505
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Re: Vanguard execs: Stock investors will be stepping off the gas for years to come

Post by GaryA505 »

sycamore wrote: Mon Jan 24, 2022 4:08 pm
Hofburg43 wrote: Mon Jan 24, 2022 1:44 pm First, what does the Minneapolis Star Tribune know about anything, much less investing and how to cover markets?
Just to clarify, the Star Tribune didn't write the article, they just published it -- the byline says "By ERIN ARVEDLUND , PHILADELPHIA INQUIRER".

Being in Vanguard's backyard, the Inquirer publishes numerous stories on Vanguard. Not that that means they know anything either :)
I'm starting to wonder if anybody knows anything.
Get most of it right and don't make any big mistakes. All else being equal, simpler is better. Simple is as simple does.
bondsr4me
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Re: Vanguard execs: Stock investors will be stepping off the gas for years to come

Post by bondsr4me »

and I quote: “nobody knows nothing”…..
Hofburg43
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Re: Vanguard execs: Stock investors will be stepping off the gas for years to come

Post by Hofburg43 »

GaryA505 wrote: Mon Jan 24, 2022 4:11 pm
sycamore wrote: Mon Jan 24, 2022 4:08 pm
Hofburg43 wrote: Mon Jan 24, 2022 1:44 pm First, what does the Minneapolis Star Tribune know about anything, much less investing and how to cover markets?
Just to clarify, the Star Tribune didn't write the article, they just published it -- the byline says "By ERIN ARVEDLUND , PHILADELPHIA INQUIRER".

Being in Vanguard's backyard, the Inquirer publishes numerous stories on Vanguard. Not that that means they know anything either :)
I'm starting to wonder if anybody knows anything.
The mass media doesn't and the airheads at "wealth advisers" and on TV don't.
But some guy a few decades ago decided to start the first low cost index fund, and he did... :moneybag :moneybag :moneybag
My lifetime requirement for investment advice was satisfied upon reading Jack Bogle write that most people need only a low cost S&P 500 Index fund.
andypanda
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Re: Vanguard execs: Stock investors will be stepping off the gas for years to come

Post by andypanda »

"I'm starting to wonder if anybody knows anything."

I'm 71 and I've never ever never heard anyone say step off the gas. Must be a local term somewhere.
Booogle
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Re: Vanguard execs: Stock investors will be stepping off the gas for years to come

Post by Booogle »

2022 Vanguard outlook

"As we look toward 2022 and beyond, our long-term outlook for assets is guarded...."

https://institutional.vanguard.com/iam/ ... 122021.pdf

The word "assets" refers to EVERYTHING in the world.
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peskypesky
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Re: Vanguard execs: Stock investors will be stepping off the gas for years to come

Post by peskypesky »

Sandtrap wrote: Sun Jan 23, 2022 7:21 am
Remember: “When E.F Hutton talks….Everybody Listens”?
OMG!!! I remember! LMAO
GaryA505
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Re: Vanguard execs: Stock investors will be stepping off the gas for years to come

Post by GaryA505 »

peskypesky wrote: Tue Jan 25, 2022 10:29 am
Sandtrap wrote: Sun Jan 23, 2022 7:21 am
Remember: “When E.F Hutton talks….Everybody Listens”?
OMG!!! I remember! LMAO
Apparently E. F. Hutton has returned from the grave.
https://efhuttongroup.com/
Get most of it right and don't make any big mistakes. All else being equal, simpler is better. Simple is as simple does.
Independent George
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Re: Vanguard execs: Stock investors will be stepping off the gas for years to come

Post by Independent George »

On the surface, it's a very reasonable expectation which I agree with - higher recent returns tends to imply lower returns in the near future.

However, back in 2008-2009, did they ever tell people to expect higher than average returns in the future? Because that's the flip side to it.
secondopinion
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Re: Vanguard execs: Stock investors will be stepping off the gas for years to come

Post by secondopinion »

bondsr4me wrote: Mon Jan 24, 2022 4:13 pm and I quote: “nobody knows nothing”…..
Does this mean "everybody knows something"? The truth, to your point, is that unless someone can correctly guess a major dip with great precision (which I yet to see) what is the point of "stepping off"? Anyone with considerable timeframe cannot afford to step out. If someone can retire or is close to retiring because of the major gains seen, then they can step back (but not out).
Passive investing: not about making big bucks but making profits. Active investing: not about beating the market but meeting goals. Speculation: not about timing the market but taking profitable risks.
incognito_man
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Re: Vanguard execs: Stock investors will be stepping off the gas for years to come

Post by incognito_man »

That range (2-4%) appears spot-on for historical values at current market prices. It seems like a reasonable range to expect given today's prices.

A month ago, the range was probably (1-3%).
JC Denton
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Re: Vanguard execs: Stock investors will be stepping off the gas for years to come

Post by JC Denton »

So returns on our risk will be less than inflation.
JC Denton
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Re: Vanguard execs: Stock investors will be stepping off the gas for years to come

Post by JC Denton »

The answer seems simple. Invest all your money in countries like have higher gdp like China. Except I am sure there is a catch, there always is.
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