Author Topic: Financial Samurai - "1% is the new SWR"  (Read 2130 times)

zolotiyeruki

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Financial Samurai - "1% is the new SWR"
« on: February 02, 2021, 12:32:17 PM »
I subscribe to the Get Rich Slowly RSS feed, and this article was posted today, authored by Financial Samurai.  The short version of his thesis is this:

The Trinity study was performed in the 80's, when the federal funds rate was around 5%.  Now, it's at 1%.  That means that corporate bonds will have a lower return, and dividends will be similarly lower.  Which means that you can only rely on a 1% return, and so you need 100x spending in order to FIRE.

Of course, saving up 100x spending is a pretty steep hill to climb.  FS's solution?  Go back to work.  Seriously.  Because "What's funny about the 4% Rule is that its proponents don't even follow the rule!"  That, or invest in higher-risk things like REITs, dividend ETFs, rental property, etc., all of which will give you something like 3-4% returns.

What's interesting is there's no mention of index funds in there...

therethere

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Re: Financial Samurai - "1% is the new SWR"
« Reply #1 on: February 02, 2021, 12:54:53 PM »
Don't give that mooch any clicks. I'm summarizing (and I hope my memory serves me right as I read the article months ago at this point) but I believe you left something out....

FS's solution? Go back to work. And hustle to increase website and other income streams to meet our excessive spending.

ysette9

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Re: Financial Samurai - "1% is the new SWR"
« Reply #2 on: February 02, 2021, 01:00:24 PM »
I feel at this point any air space we give this guy is a losing to position for us as he is clearly only about outlandish click-bait articles. He isnít substantially adding to the conversation in any meaningful way. Letís just move along.

Telecaster

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Re: Financial Samurai - "1% is the new SWR"
« Reply #3 on: February 02, 2021, 01:02:48 PM »
What a loon. 

UnleashHell

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Re: Financial Samurai - "1% is the new SWR"
« Reply #4 on: February 02, 2021, 01:41:20 PM »
Samurai: They were the well-paid retainers of the daimyo (the great feudal landholders).

1% my hairy arse!

Malcat

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Re: Financial Samurai - "1% is the new SWR"
« Reply #5 on: February 02, 2021, 02:04:48 PM »
This has been discussed a lot. He just puts out clickbait bullshit because he's admitted he needs more money to meet his inflated lifestyle.

Don't give it a second thought.

achvfi

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Re: Financial Samurai - "1% is the new SWR"
« Reply #6 on: February 02, 2021, 02:16:37 PM »
What a loon.
Yeah, a nutcase. He lost touch of reality. I will not click on that link :)

Malcat

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Re: Financial Samurai - "1% is the new SWR"
« Reply #7 on: February 02, 2021, 02:24:39 PM »
What a loon.
Yeah, a nutcase. He lost touch of reality. I will not click on that link :)

He's not crazy, he's perfectly rational and knows exactly how to sell out his previous position of respect for the sake of click and cash.

He has nothing legitimate left to say that can possibly go viral, and he's been very open that he desperately wants more wealth.

This isn't lunacy, it's plain old boring greed.

achvfi

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Re: Financial Samurai - "1% is the new SWR"
« Reply #8 on: February 02, 2021, 03:18:03 PM »
What a loon.
Yeah, a nutcase. He lost touch of reality. I will not click on that link :)

He's not crazy, he's perfectly rational and knows exactly how to sell out his previous position of respect for the sake of click and cash.

He has nothing legitimate left to say that can possibly go viral, and he's been very open that he desperately wants more wealth.

This isn't lunacy, it's plain old boring greed.
Right. It reminds of another respected guy, Robert Kiyosaki from rich dad poor dad. These days he just talks crazy, lures people into his bad investments and involved in shady practices.

DadJokes

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Re: Financial Samurai - "1% is the new SWR"
« Reply #9 on: February 03, 2021, 06:29:53 AM »
What a loon.
Yeah, a nutcase. He lost touch of reality. I will not click on that link :)

He's not crazy, he's perfectly rational and knows exactly how to sell out his previous position of respect for the sake of click and cash.

He has nothing legitimate left to say that can possibly go viral, and he's been very open that he desperately wants more wealth.

This isn't lunacy, it's plain old boring greed.
Right. It reminds of another respected guy, Robert Kiyosaki from rich dad poor dad. These days he just talks crazy, lures people into his bad investments and involved in shady practices.

When was Robert Kiyosaki respected? Even the original book was scammy.

norajean

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Re: Financial Samurai - "1% is the new SWR"
« Reply #10 on: February 03, 2021, 07:42:14 AM »
One percent sounds low.

Fomerly known as something

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Re: Financial Samurai - "1% is the new SWR"
« Reply #11 on: February 03, 2021, 07:58:06 PM »
The comment were interesting, I only clicked because it was a guest post on Get Rich slowly, the theme seemed to be why are you publishing something from the snake oil salesman.

tooqk4u22

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Re: Financial Samurai - "1% is the new SWR"
« Reply #12 on: February 04, 2021, 08:28:48 AM »
He is the worst. 

However, the main thing that concerns me from a historical perspective is the 40 year bull market in interest rates that also corresponds with a 40 year bull market in debt (private, corporate, government).  Which also aids the high multiples we have.  So makes sense that returns will be lower going forward, rates really can't go much lower (fed will always fight).

But 1% - GTFOH!     

less4success

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Re: Financial Samurai - "1% is the new SWR"
« Reply #13 on: February 04, 2021, 08:45:51 AM »
I subscribe to the Get Rich Slowly RSS feed, and this article was posted today, authored by Financial Samurai

If Get Rich Slowly is posting Financial Samurai's clickbait articles, I would humbly recommend unsubscribing.

Edit: GRS owned up to this mistake and pulled the article.
« Last Edit: February 05, 2021, 10:23:47 PM by less4success »

bacchi

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Re: Financial Samurai - "1% is the new SWR"
« Reply #14 on: February 04, 2021, 09:11:09 AM »
The comment were interesting, I only clicked because it was a guest post on Get Rich slowly, the theme seemed to be why are you publishing something from the snake oil salesman.

Ha. "Syd" defends FS too much.

StarBright

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Re: Financial Samurai - "1% is the new SWR"
« Reply #15 on: February 04, 2021, 11:13:59 AM »
I subscribe to the Get Rich Slowly RSS feed, and this article was posted today, authored by Financial Samurai

If Get Rich Slowly is posting Financial Samurai's clickbait articles, I would humbly recommend unsubscribing.

I was reading the comments on an earlier article and it looked like JD from GRS and FinSam may have had a little spat about something else. I figured running the FinSam post was an olive branch of sorts.

For what it is worth, GRS put caveats at the top and bottom of the post saying they disagreed with most the of the article but that they are committed to sharing different viewpoints occasionally.

I really love GRS because JD is such an imperfect FIREer and he is so honest about it. And he is always trying to be better but so open about being far from perfect. I find it to be one of the most human FIRE blogs.

dandarc

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Re: Financial Samurai - "1% is the new SWR"
« Reply #16 on: February 04, 2021, 01:12:30 PM »
Not the caveat at the top was put there at the request of commenters - not everyone just knows "Sam Dogan = Financial Samurai" but lots of people know "Financial Samurai = not worth your time to read it".

zolotiyeruki

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Re: Financial Samurai - "1% is the new SWR"
« Reply #17 on: February 04, 2021, 03:52:28 PM »
Not the caveat at the top was put there at the request of commenters - not everyone just knows "Sam Dogan = Financial Samurai" but lots of people know "Financial Samurai = not worth your time to read it".
I'm one of those formerly-oblivious users.  It's only halfway through the article when he mentions FS that I started to wonder, although by that point he had already lost me.

ixtap

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Re: Financial Samurai - "1% is the new SWR"
« Reply #18 on: February 04, 2021, 04:09:21 PM »
MY EYES! THEY BURN!

20x Gross Annual Income is even safer because then you can't fudge the budget?!?!

I have run calculations and informed my husband he needs to work another 12 years to accumulate the proper amount. He has informed me we need to get moving on estate planning. Not sure if that is for proper distribution of obscene amounts of money or because he is going to be killing me.

dandarc

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DadJokes

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Travis

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Re: Financial Samurai - "1% is the new SWR"
« Reply #21 on: February 05, 2021, 06:35:27 PM »
https://www.getrichslowly.org/a-retraction/

Dang. That's pretty brutal.

And should be telling to any future readers of FS - he refuses to defend his own words or show his data.

tooqk4u22

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Re: Financial Samurai - "1% is the new SWR"
« Reply #22 on: February 05, 2021, 08:06:04 PM »
https://www.getrichslowly.org/a-retraction/

Dang. That's pretty brutal.

And should be telling to any future readers of FS - he refuses to defend his own words or show his data.

But GRS still included s link back