Long Story Short Spending on Experiences, Monte Carlo Projections & What Forward Returns Actually Look Like
Spring break had Andy thinking about something that comes up often with clients who have accumulated wealth: the value of spending on experiences over things. Adam connects this to a broader shift toward the experience and convenience economies, and Andy shares a personal story about his grandmother sponsoring family trips that still shape how he thinks about money and memory.
That leads into a practical conversation about the flaws of Monte Carlo analysis, and what should replace it. Adam lays out why Monte Carlo, despite its popularity, tends to push clients toward underspending, ignores realistic adjustments people would naturally make in a downturn, and uses return assumptions that may not match your actual portfolio. The better approach combines a conservative linear plan with dynamic spending guardrails that tell you exactly when to give yourself a raise and when to cut back.
They close on market valuations and forward return expectations. Vanguard and Goldman Sachs are both forecasting roughly 3% annual returns from the S&P 500 over the next decade, well below historical averages. Adam and Andy explain what that means for retirement planning and why the current pullback toward correction territory may actually improve the picture for people with cash on the sidelines.
⏱️ Timestamps:
(0:51) Intro: Andy's spring break and the experience economy
(2:43) Spending on experiences vs. things: why it matters in retirement planning
(6:18) Why diligent savers often need permission to spend
(7:54) Andy's grandmother, family trips, and what actually gets remembered
(9:41) Monte Carlo analysis explained: running your plan a thousand times
(10:55) Linear planning vs. Monte Carlo: what each one does well and poorly
(15:08) The problem with aiming for a 90% Monte Carlo score
(16:28) It doesn't account for natural spending adjustments in downturns
(19:48) A preferred approach: conservative linear plan plus dynamic spending guardrails
(23:17) The GPS analogy: dynamic planning vs. a paper map
(25:13) Vanguard and Goldman Sachs are forecasting roughly 3% annual returns for the next decade
(27:06) Goldman's sentiment indicator and why low sentiment tends to precede better returns
(28:44) The lost decade of the 2000s and why diversification paid off then
(34:26) Podcast disclosures
Resources:
Long Story Short website | burneywealth.com/podcast
Follow Burney Wealth Management on LinkedIn | www.linkedin.com/company/burneywealthmanagement
Follow Adam Newman on Linkedin | www.linkedin.com/in/adam-newman-cfa-cfp%C2%AE-mst-ricp%C2%AE-cepa-48853916/
Follow Andy Pratt on LinkedIn | www.linkedin.com/in/andyjpratt/
Have questions you want answered on the podcast? Email longstoryshort@burney.com
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The Burney Company is an SEC-registered investment adviser. Burney Wealth Management is a division of the Burney Company. Registration with the SEC or any state securities authority does not imply that Burney Company or any of its principals or employees possesses a particular level of skill or training in the investment advisory business or any other business. This content is for informational and educational purposes only. It is not intended as personalized investment advice or a recommendation.