That example is both fascinating and reassuring Marc. Thanks for sharing.You are of course correct. I wasn't focusing on the exact mathematics more the practical principles.
We like to paint pictures to illustrate the points. This is a real client's ARF account over the last 5 years. The original capital is the red line showing the annual distributions coming off each year and the blue line is the account value. Working perfectly...
Best options for short term liquidity is still State Savings I recently updated my analysis here
We strongly advocate that longer-term investments should be arranged via pensions and stock-market linked investment accounts.globalwealth.ie
to reflect the new less attractive, but still relatively good (compared to the bank) terms
Longer-term taxable investment accounts are best managed with a pure equity portfolio of non-EU ETFs and dial down the risk in the pension to accounts to compensate
Many investors find it difficult to achieve returns offered by the markets due to a misunderstanding of investment risk, costs and taxes.globalwealth.ie
What income are they drawing from it?