The FIRE Rebalancing Mistake That Costs You Returns

In this episode of The FIRE Podcast, Lucas and Luna dive into a hidden drag on early retirement portfolios: the rebalancing schedule. Most FIRE planners rebalance quarterly or annually, but new research shows that rebalancing too often can shave 0.5% to 1% off annual returns over a decade. They break down why the standard 60/40 portfolio suffers from 'rebalancing regret' in trending markets, and walk through a case study using Vanguard's own data on the 2020–2025 bull run. Luna challenges Lucas on whether the 'set it and forget it' approach works when you're living off withdrawals, and they land on a specific threshold-based strategy that triggers rebalancing only when an asset class drifts more than 5% from target. If you're in or nearing FIRE, this episode may save you from a costly mechanical habit. #FIRE #EarlyRetirement #PortfolioRebalancing #InvestmentStrategy #PassiveIncome #FIREPodcast #FexingoBusiness #BusinessPodcast #FinancePodcast #Vanguard #60_40Portfolio #ThresholdRebalancing #RebalancingCosts #RetirementWithdrawals #AssetAllocation #BullMarket #FinancialIndependence #WealthManagement Keep every episode free: buymeacoffee.com/fexingo