[El]

Why don’t more people adopt a risk parity style portfolio? Is it because most people are ignorant to it? Most people are still in accumulation?

If a high swr which is the core of FIRE is your goal then it makes perfect sense to transition to a risk parity type portfolio but I don’t see it talked about nearly enough so just wondering if I’m missing something

[Jeff]

I have begun my slow down phase. Only withdrawing less than 1.5% annually, but that will go up as we transition to full time retirement when my youngest graduates high school in a year and a half.

I’ve transitioned to a risk parity style portfolio with swr’s projected above 5%.

I think, until you’re getting close to this stage of life, you have no reason to learn about it. At least, I didn’t.

I think as more people learn about Frank Vasquez’s podcast, it will become a more talked about subject.

[Rick]

Accumulation, yes that is a part. Awareness too. I believe another part is complexity is scary and creates a desire to ignore it or say I am fine without it.

But I expect the two biggest reasons are tied to
1. VTSAX and chill has mostly crushed it for over a decade. Asking someone to deviate significantly from the goose laying the current golden eggs is no easy thing.

A period of time will come where vtsax and chill is no longer the golden goose and that time will create more interest in purposeful portfolio construction.

2. Most people are just not planning on portfolio SWR alone. They will have extra income. They have a partner with income.

They plan geo arbitrage for years to drive needs down to 1-2% withdrawals. And many other reasons.

And so, the need for 5.5%+ SWR is likely far lower than you may expect and with that a reduced need for portfolios designed to produce it.

[Author]

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