Business Marketing Magazine Summer 2017 Do It Yourself SEO Tips and Tools | Page 32

With this in mind, DO NOT accept historical
rates of 10% or so or be lulled into “reversion to the mean” (a term that means that
the current lower rates (the S&P was flat
for 2015) will start to increase to reflect
to make up for lost time.) The lower GDP
means lower earnings which, obviously,
means lower sales and profits, which means
lower stock prices. Period.

So we have bond valuations suffering from
mandatory interest rate increases and lower
stock prices.
If you want to do a portfolio allocation
simply utilizing a 60/40 split of stocks and
bonds (which generally reflects an advisor
who doesn’t know what he or she is doing),
I doubt that overall returns would be much
more than 4% to 5%. Reducing bond funds
(remember this material is for middle class
who would not be using individual bonds to
maturity), then a 5% to 6,5% return might
be feasible.
As will be shown in subsequent months
after we finish a couple more inputs, it is
possible to make up
a table that gives a
range of monies necessary to payout $x
for retirement.

So in summary, inflation goes from 2%
to 4% and rates of return from 4% to 6.5%.
Think on that for a while till it starts to sinks
in. And try to view Roubini.

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Matt