This piece by Nanette Byrnes originally appeared on Portfolioist.
What rate of return can we realistically expect from our investments? Seven percent? Eight percent? 12 percent?
This is no academic brain teaser to anyone saving for retirement or a down payment. It’s not easy to get right, and getting it right is critically important.
A version of this post originally appeared on Portfolioist.
The Employee Benefits Research Institute has issued the 2011 Retirement Confidence Survey. And the answer is: We are not confident. This seems to be, one could argue, an acknowledgment of the obvious.
One statistic that was surprising, however: 31 percent of people surveyed said they expected they could retire comfortably on under $250,000 in savings.
A recent Portfolioist.com piece on the tradeoffs of investing in dividend stocks instead of bonds sparked a lively discussion about global dividend stocks. The big question for readers: “How come no one ever writes about income investing outside the U.S.?”
One reason may be that investors don’t have to go to foreign corporations for global dividends. Many U.S.-based dividend payers earn lots of their revenue overseas — Philip Morris International (PM) is legally headquartered in New York but gets 100 percent of its revenue selling Marlboros and other tobacco products outside of the 50 states. Its yield is currently 4.6 percent.