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Long Term Is Longer Than You Think

TedTed
in Fund Discussions
FYI: Investment time horizon is a critical concept in building wealth. Most investors have very long investment time horizons, typically decades or more. Investment managers also require long time horizons to deliver on their investment thesis. Finally, stock market volatility diminishes substantially over time, with a 75% decrease in variability for 10 years versus one year. As a result, developing patience and a long-term perspective are key to building wealth. We are living longer and need to invest appropriately. Even at age 70, the investment time horizon is more than 20 years.
Regards,
Ted
https://www.advisorperspectives.com/articles/2019/07/15/long-term-is-longer-than-you-think

Comments

  • davfordavfor
    edited July 2019
    Interesting short read. I turn 70 in a few months. Based on my current health status and the life spans of my parents and grandparents, I currently have my investment time horizon set at 21 years. I would be 90 years old at that point. Its been set at 90 since 2014 when I added an annual review of my planning horizon to my annual year-end portfolio review process. So, the chart makes sense to me.
  • JunksterJunkster
    edited July 2019
    davfor said:

    Interesting short read. I turn 70 in a few months. Based on my current health status and the life spans of my parents and grandparents, I currently have my investment time horizon set at 21 years. I would be 90 years old at that point. Its been set at 90 since 2014 when I added an annual review of my planning horizon to my annual year-end portfolio review process. So, the chart makes sense to me.

    Your investment time horizon seems reasonable. I say that because most everyone seems to overestimate how long they will live and think they will all live to 100. Longevity tables show those around our age ( I am 72) should live to 84/85. My high school and college classmates are dying off at an alarming rate. I am not sure in the U.S. lifespans are still expanding since obesity and being overweight has become so rampant over the past many years. Anyway, I never think about how many years I have left. Just try to live each day as if it is my last and spend some time each day on the trails, preferably in the middle of nowhere.

  • davfordavfor
    @junkster I view any time after 90 as bonus time as far as my investment planning horizon is concerned. My health status is good and my family history suggests living into my 90's is quite possible, likely even probable. But paying attention to a portfolio at that age...I don't want to plan on that happening!
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