Post #4781 by james22 on the Berkshire Hathaway board

Stocks A to Z / Stocks B / Berkshire Hathaway (BRK.A) ❤

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Sequence of returns not an issue "If you have enough money to fund your retirement".

Sure.

But over the long run you'll not get the average valuation.

In fact, SWR and the average return are only very slightly correlated.

https://earlyretirementnow.com/2017/05/24/the-ulti...

Buffett (2014): "But I've told the trustee to put 90% of it in an S&P 500 index fund and 10% in short-term governments. And the reason for the 10% in short-term governments is that if there's a terrible period in the market and she's withdrawing 3% or 4% a year you take it out of that instead of selling stocks at the wrong time. She'll do fine with that. And anybody will do fine with that. It's low-cost, it's in a bunch of wonderful businesses and it takes care of itself."

This is what I do myself, but only because I have a <3% WR.

The Cash Cushion approach is really caught between a rock and a hard place. Either the drawdown is so long that you can’t possibly have enough cash to make it through or the drawdown is short enough that the cash cushion likely wouldn’t have made a big difference.

https://earlyretirementnow.com/2017/03/29/the-ulti...

https://earlyretirementnow.com/2021/09/14/bucket-s...
https://earlyretirementnow.com/2023/01/25/discussi...
https://earlyretirementnow.com/2018/05/23/the-ulti...

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