07-08-2017, 08:46 AM
Good morning....
Just sipping my coffee and playing around with Portfolio Visualizer after reading an SA article warning that DGI may not be the be all-end all as interest rates rise. Using the DG50 portfolio created by SA author Mike Nadel as a foundation I added a few random picks of my own bringing the portfolio count to 61 stocks.
For round numbers I began with a $1 million dollar portfolio that withdrew 4% (inflation adjusted) annually. I was able to get PV to look back from 2001-2017.
The three portfolios:
Portfolio 1: My DGI "61" pure stock (a variation on Mike's Gold Standard DG50)
Portfolio 2: My DGI "61" adjusted to include a 30% allocation of Vanguard Total Bond Fund (VBMFX)
Portfolio 3: 100% Vanguard Wellington (VWELX) which is roughly a 65/35 allocation. I have always considered this a a no-brainer for my better half in an emergency...the fund goes back to 1929.
In fact if you substitute Vanguard Growth Index (VIGRX) or Vanguard Total Stock Market Index(VTSMX) in Portfolio 3 at 100% you end up with $200,000 and $100,000 less respectively.
So the bottom line....press on...we've got a good plan here. If you are just discovering DGI, Mike Nadel's DG50 series is a great place to start.
Cheers!
Rob
Just sipping my coffee and playing around with Portfolio Visualizer after reading an SA article warning that DGI may not be the be all-end all as interest rates rise. Using the DG50 portfolio created by SA author Mike Nadel as a foundation I added a few random picks of my own bringing the portfolio count to 61 stocks.
For round numbers I began with a $1 million dollar portfolio that withdrew 4% (inflation adjusted) annually. I was able to get PV to look back from 2001-2017.
The three portfolios:
Portfolio 1: My DGI "61" pure stock (a variation on Mike's Gold Standard DG50)
Portfolio 2: My DGI "61" adjusted to include a 30% allocation of Vanguard Total Bond Fund (VBMFX)
Portfolio 3: 100% Vanguard Wellington (VWELX) which is roughly a 65/35 allocation. I have always considered this a a no-brainer for my better half in an emergency...the fund goes back to 1929.
In fact if you substitute Vanguard Growth Index (VIGRX) or Vanguard Total Stock Market Index(VTSMX) in Portfolio 3 at 100% you end up with $200,000 and $100,000 less respectively.
So the bottom line....press on...we've got a good plan here. If you are just discovering DGI, Mike Nadel's DG50 series is a great place to start.
Cheers!
Rob
There are people who use up their entire lives making money so they can enjoy the lives they have entirely used up
Frederick Buechner
Frederick Buechner