Portfolio Spending Illustration

This illustration shows a 5% spending from a portfolio of large US companies as illustrated by the S&P 500 index. The analysis assumes you spend 5% of the prior year-end balance, which starts at $1 million in 1970. This timeline includes a decade of weak market returns in the 1970s and then a historically bad decade of returns in the 2000s. Even with these tough market environments the balance ended 2022 at $1.5 million and produced portfolio spending of close to $3.8 million.

Parsec certainly doesn’t recommend an all-equity approach for all of its clients, but it has long been Parsec’s philosophy that an investor with a long time horizon needs to have a majority of their assets invested in a globally diversified stock allocation.

Source: Duff & Phelps, LLC. 2022 SBBI® Yearbook. Illustration assumes annual spending was taken at the beginning of the year. Past performance is no guarantee of future results. All figures take into account inflation. Updated: Dec. 2022