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Author: GusSmed Big gold star, 5000 posts Old School Fool CAPS All Star Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 62965  
Subject: Re: SWR and irrational exuberance Date: 2/7/2007 9:09 PM
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Most universities and large charitable foundations limit their endowement withdrawals to 4%-5% of assets per year

Playing the Devil's Advocate for a few seconds here, the counterargument is that large institutions can't reasonably expect to outperform the S&P 500 or dodge market drops. Even with someone exceptional at the helm, big funds have inertia.

The Motley Fool ads for their newsletters have been repeating Buffet's comment about making 50% CAGR if he was dealing with smaller amounts, pumping it for all it's worth. Maybe so, but somehow I don't think reading a TMF newsletter will turn you into Warren Buffet.

Maybe smart guys can outperform the S&P 500 consistently. I like to think I have a shot at it, for example. Maybe BMW's approach is really sure-fire.

But 10% withdrawal? I think you need to be Buffet or really lucky to have that work for 30+ years. BMW says he did well with his mother's retirement funds through 2000-2003, but will the approach never stumble right after retirement?

- Gus
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