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The suggestion is to simply to lower expectations. People always expect their 401Ks to beat inflation over the long run. Author is saying you might see a lost d
by francisofascii 3y ago
The suggestion is to simply to lower expectations. People always expect their 401Ks to beat inflation over the long run. Author is saying you might see a lost decade where you gain very little.
- Kirby64 3y agoThe 'lost decade' issues only have previously applied if you dump all your money in at a specific timeframe, then never contribute anything else. Or, alternatively, if you pull out a large amount of money after the downturn. Traditional 'set and forget' 401k funding would imply you continue to contribute throughout the period (i.e., dollar-cost-averaging). By putting money in during the downturn, those dollars earn outsized rewards when the market inevitably bounces back. It essentially cancels out the money lost.
- WkndTriathlete 3y agoWhich is stupid. If I shouldn't expect returns on my investments to beat inflation why would I bother investing in equities? By that metric I should put all of my money in TIPS and be done with it.