Scenario: Retired, what would you do?

[jIM_Ohio]

I'm going to have to take your word for it because all I see is computer language.

My excel sheet did not paste, I needed to edit the post. How does it look now?

BTW- the numbers you posted- what are those returns for?

[maat55]

My excel sheet did not paste, I needed to edit the post. How does it look now?

BTW- the numbers you posted- what are those returns for?

I went to get an history report for the S&P 500 and was given the numbers I have listed. I copied the numbers for 1970 and on, but they are jiving with your numbers. I'm not sure what stats DR used in his example of two year recovery. Based on your numbers, his would be wrong.

Where do you get the official history for every year of the S&P 500?

[maat55]

Here is the chart I used.

Calculated based upon earnings yield and S&P 500 levels each year. The raw data for this table was obtained from Bloomberg (and from S&P).

6.66% 6.49%
1970 5.98% 3.46% 92.15 5.51 3.19 -9.72% -1.61%
1971 5.46% 3.10% 102.09 5.57 3.16 1.15% -0.74%
1972 5.23% 2.70% 118.05 6.17 3.19 10.76% 0.71%
1973 8.16% 3.70% 97.55 7.96 3.61 28.93% 13.24%
1974 13.64% 5.43% 68.56 9.35 3.72 17.48% 3.14%
1975 8.55% 4.14% 90.19 7.71 3.73 -17.54% 0.30%
1976 9.07% 3.93% 107.46 9.75 4.22 26.39% 13.10%
1977 11.43% 5.11% 95.1 10.87 4.86 11.53% 15.07%
1978 12.11% 5.39% 96.11 11.64 5.18 7.07% 6.60%
1979 13.48% 5.53% 107.94 14.55 5.97 25.01% 15.23%
1980 11.04% 4.74% 135.76 14.99 6.44 3.01% 7.81%
1981 12.39% 5.57% 122.55 15.18 6.83 1.31% 6.08%
1982 9.83% 4.93% 140.64 13.82 6.93 -8.95% 1.58%
1983 8.06% 4.32% 164.93 13.29 7.12 -3.84% 2.76%
1984 10.07% 4.68% 167.24 16.84 7.83 26.69% 9.85%
1985 7.42% 3.88% 211.28 15.68 8.20 -6.91% 4.74%
1986 5.96% 3.38% 242.17 14.43 8.19 -7.93% -0.15%
1987 6.49% 3.71% 247.08 16.04 9.17 11.10% 11.99%
1988 8.20% 3.68% 277.72 22.77 10.22 42.02% 11.49%
1989 6.80% 3.32% 353.4 24.03 11.73 5.52% 14.80%
1990 6.58% 3.74% 330.22 21.73 12.35 -9.58% 5.26%
1991 4.58% 3.11% 417.09 19.10 12.97 -12.08% 5.03%
1992 4.16% 2.90% 435.71 18.13 12.64 -5.12% -2.59%
1993 4.25% 2.72% 466.45 19.82 12.69 9.37% 0.41%
1994 5.89% 2.91% 459.27 27.05 13.36 36.45% 5.34%
1995 5.74% 2.30% 615.93 35.35 14.17 30.70% 6.00%
1996 4.83% 2.01% 740.74 35.78 14.89 1.20% 5.10%
1997 4.08% 1.60% 970.43 39.56 15.52 10.57% 4.25%
1998 3.11% 1.32% 1229.23 38.23 16.20 -3.35% 4.37%
1999 3.07% 1.14% 1469.25 45.17 16.71 18.13% 3.16%
2000 3.94% 1.23% 1320.28 52.00 16.27 15.13% -2.65%
2001 3.85% 1.37% 1148.09 44.23 15.74 -14.94% -3.24%
2002 5.37% 1.83% 879.82 47.24 16.08 6.81% 2.15%
2003 4.87% 1.61% 1111.91 54.15 17.88 14.63% 11.19%
2004 5.53% 1.60% 1211.92 67.01 19.407 23.75% 8.54%
2005 5.47% 1.79% 1248.29 68.32 22.38 1.95% 15.32%
2006 5.78% 1.77% 1418.3 81.96 25.05 19.96% 11.93%
2007 5.96% 1.89% 1468.36 87.51 27.73 6.77% 10.70%

[jIM_Ohio]

Take one line

2007 5.96% 1.89% 1468.36 87.51 27.73 6.77% 10.70%

what do these mean?

1468 I am guessing is what this closed at Dec 31
5.96% might be the yearly return from previous close?
1.89%- what is that?
87.51- what is that?
27.73- what is that
6.77%- what is that?
10.70% what is that?

For returns I would look at a mutual fund because the mutual fund will include reinvested dividends. Often times the values on the S&P 500 chart will not.

[jIM_Ohio]

You proved the 2 year recovery to get back to level of the last year of the drop. But to recover from the peak takes much longer than 2 years.

DR measured what appears to be one bottom year to turnaround.
I am measuring peak to peak (how long until second peak is level of first peak). Peak to peak implies the first time you could sell and not lose money on any share you purchased during last bull market.

[maat55]

Take one line


what do these mean?

1468 I am guessing is what this closed at Dec 31
5.96% might be the yearly return from previous close?
1.89%- what is that?
87.51- what is that?
27.73- what is that
6.77%- what is that?
10.70% what is that?

For returns I would look at a mutual fund because the mutual fund will include reinvested dividends. Often times the values on the S&P 500 chart will not.

Here is the top line of the chart.
Year/ Earnings Yield/ Dividend Yield/ S&P 500/ Earnings/ Dividends/ Change in Earnings/ Change in