Hi DT:
How do you think your holdings would do if/when interest rates move up, and inflation increases?
Great Question. To answer that question you have to define the term “your holdings”
I previously had mentioned that my portfolio value currently is 11 times the initial starting value of when I retired on July 1 2003 and that 11(Eleven) times value is after spending about 3 times initial portfolio value for all my living expenses over all these years.So, so far the portfolio has made a good amount of paper money and incurred a large embedded tax obligation.
Example: I buy a stock for $100 It goes up 11 times and is now valued at $1200 in my portfolio. For me to get that $1200 in cash I have to sell and pay tax on $1100 of about $367 leaving me with only $733 + $100=$833 cash in hand- AND I STILL DON’T HAVE THE $1200 And even worse I don’t have the income stream that $1200 investment earned to pay my bills. I now have to spend capital to pay those bills further eating into the remaining $833. The important metric for me is the continuation of the income stream. And that’s why I seek income that is as tax sheltered as possible.
So DT—I don’t know if I answered your question, because it gets complicated.
Good luck
b&w