Fear of dying with too much money?

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willthrill81
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Fear of dying with too much money?

Post by willthrill81 » Sat Jan 20, 2018 2:37 pm

The White Coat Investor has a blog post today that is republished from Passive Income MD. It discusses the counter-fear to the "fear of running out of money," (FOROOM) namely, the "fear of dying with too much money."

Here are some of the post's downsides to dying with too much money.
1. It means you worked longer than you needed to.
2. It might mean that you deprived yourself of some pleasures by being too frugal.
3. Perhaps there are other people who could have benefited from your income but did not.
4. You might trigger inheritance or estate taxes.
5. You might ultimately hand down your money to someone who doesn’t really need it.

https://www.whitecoatinvestor.com/downs ... uch-money/

I've personally witnessed all but #4 on that list. In one family, the parents were extremely frugal (didn't even buy toilet paper, use your imagination), and died with a sizable estate. Their kids wound up fighting over it, and it pretty much destroyed the family's relationships.

Obviously, it is impossible to know up front precisely how much money one needs to be FI or retirement safely because there are many unknowns. But when I hear people talking about a sub-3% withdrawal rate, I really think that they are letting the FOROOM take precedence over everything else.

There are ways to combat this fear and very real risk of dying with too much money. Annuities, whether deferred or immediate, can actually help with both FOROOM and dying with too much money since upon death, there is (usually) no money left over (that was used to buy the annuity). The Bogleheads' variable percentage withdrawal can also help with this situation on both counts.

This is where I think that fixed withdrawal rates like the '4% rule' really fall short. Depending on the precise percent used, market conditions, etc., you're very unlikely to die in the 'sweet spot' of leaving 'just enough' behind. What is most likely to happen is that either (1) you'll die with far more than you needed or (2) you'll run out of money if your starting withdrawal percentage was too big. The second concern isn't really a big deal since no sane person will continue drawing down a failing portfolio until it is entirely exhausted, but their withdrawals could become small.

Consequently, I like flexible withdrawal rates (e.g. fixed percentage withdrawals) like 5% of annual ending portfolio balance, assuming that the retiree is able and willing to decrease their spending if/when needed. These have done a much better of job at converting the portfolio's balance into withdrawals over a retirement period, and it's literally impossible to ever run out of money. I'm not sure, though, how well this method addresses FOROOM or the fear of dying with too much.
“It's a dangerous business, Frodo, going out your door. You step onto the road, and if you don't keep your feet, there's no knowing where you might be swept off to.” J.R.R. Tolkien,The Lord of the Rings

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randomizer
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Re: Fear of dying with too much money?

Post by randomizer » Sat Jan 20, 2018 2:39 pm

I am nowhere near having that fear, nor do I fear ever developing the fear. :D
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Re: Fear of dying with too much money?

Post by willthrill81 » Sat Jan 20, 2018 2:42 pm

randomizer wrote:
Sat Jan 20, 2018 2:39 pm
I am nowhere near having that fear, nor do I fear ever developing the fear. :D
Good for you.

Personally, if my portfolio tripled over the course of the first 20 years of retirement, I believe that fear would become very real for me.
“It's a dangerous business, Frodo, going out your door. You step onto the road, and if you don't keep your feet, there's no knowing where you might be swept off to.” J.R.R. Tolkien,The Lord of the Rings

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Re: Fear of dying with too much money?

Post by TomatoTomahto » Sat Jan 20, 2018 2:52 pm

I sometimes worry that my wife and I disagree on how much to leave the kids and how much to give to charity and other people. I hope we live a long time, because as time goes on, we disagree less about this.

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Re: Fear of dying with too much money?

Post by Ron » Sat Jan 20, 2018 3:02 pm

Having an adult disabled "child", neither me or my wife will ever have this fear.

We invest for his future.

- Ron

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Re: Fear of dying with too much money?

Post by TomatoTomahto » Sat Jan 20, 2018 3:09 pm

Ron wrote:
Sat Jan 20, 2018 3:02 pm
Having an adult disabled "child", neither me or my wife will ever have this fear.

We invest for his future.

- Ron
The best of luck to you and yours.

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Re: Fear of dying with too much money?

Post by IlliniDave » Sat Jan 20, 2018 3:11 pm

No fear of that whatsoever.
Don't do something. Just stand there!

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Re: Fear of dying with too much money?

Post by Earl Lemongrab » Sat Jan 20, 2018 3:21 pm

I expect to die with lots of money. If I don't, then the likely cause would have been some protracted and expensive medical expenses or protracted nursing home stay or both. Neither of those sounds great. I'd prefer to live my quiet and simple life for a fair amount longer. There's a pretty good chance, barring significant inflation, that I'll live out my life on my pension and social security, with maybe some dip into taxable account dividends.

I never concerns me that there is money that I could have spent and didn't. I spend what I want now. I don't budget for retirement or anything else.

The money goes to my family, and I like them.
Last edited by Earl Lemongrab on Sat Jan 20, 2018 3:24 pm, edited 1 time in total.
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Re: Fear of dying with too much money?

Post by tfb » Sat Jan 20, 2018 3:23 pm

It won't happen. Barring unexpected death, there are always ways to spend money on things and experiences we enjoy.
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Re: Fear of dying with too much money?

Post by CppCoder » Sat Jan 20, 2018 3:26 pm

If this is a real problem for you, I'll send you an address, and you can mail me checks every month. Will that help you sleep? I'll even be a sport and let you choose a variable amount to mail each month. :D

I suspect I will die with leftover. Maybe it will mean I will have worked too long, but that's ok, my job's not so bad. I don't deprive myself, but don't feel the need to spend money just because it's there. I guess I view having too much money as a self-insurance policy on life. Even though I have home owner's insurance, I don't lament not having my house burn down and not using that policy. If I so choose, I can cash in my insurance policy at death and fund charities once I know I won't need it. I guess I won't get the enjoyment of helping other people, but at least I'll help other people...

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Re: Fear of dying with too much money?

Post by 2b2 » Sat Jan 20, 2018 3:51 pm

How much is too much?
If one dies with $100 in a checking account, is that "dying with too much money"?

2b2

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Re: Fear of dying with too much money?

Post by aqan » Sat Jan 20, 2018 4:01 pm

2b2 wrote:
Sat Jan 20, 2018 3:51 pm
How much is too much?
If one dies with $100 in a checking account, is that "dying with too much money"?

2b2
you decide.

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Re: Fear of dying with too much money?

Post by midareff » Sat Jan 20, 2018 4:06 pm

I'm much more concerned with matching my WR and spending curve to the Go-Go phase of retirement I'm in @ 70 y/o, and like to travel. From my own observations of my slowly diminishing physical abilities and observing those on trips around me the later 70's to 80 is about is far as active travel gets. By active I mean getting off the cruise ship and spending 4-6 hours walking around the town with a lunch break in the middle. Perhaps we could call it an active Viking River Cruiser.

OTOH, I have no fear of dying with too much as my somewhat younger and much healthier wife will be able to spread some joy with my two lovely step-daughters and first step grandson. The last eight years in the market have been beyond bountiful.

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Re: Fear of dying with too much money?

Post by itstoomuch » Sat Jan 20, 2018 4:08 pm

#5 is our issue. However, The Only is making 1031 arrangements to where we may have to take a 30yr/5% mortgage, Seattle, and he will take the step-up on our passing :annoyed The risk-reward ratio appears to pencil out but somehow it doesn't feel right.
At this time, kinda glad that DS isn't hooked up. :confused
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Re: Fear of dying with too much money?

Post by DrGoogle2017 » Sat Jan 20, 2018 4:28 pm

I don’t have this fear, I’m still spending money. In fact, I plan to kick it up a notch.

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Re: Fear of dying with too much money?

Post by willthrill81 » Sat Jan 20, 2018 4:34 pm

midareff wrote:
Sat Jan 20, 2018 4:06 pm
I'm much more concerned with matching my WR and spending curve to the Go-Go phase of retirement I'm in @ 70 y/o, and like to travel. From my own observations of my slowly diminishing physical abilities and observing those on trips around me the later 70's to 80 is about is far as active travel gets. By active I mean getting off the cruise ship and spending 4-6 hours walking around the town with a lunch break in the middle. Perhaps we could call it an active Viking River Cruiser.
My thoughts are similar. I've been advising my parents, both in their late 60s, who really enjoy traveling to do what they realistically can now while they are physically able. As you note, globe trotting tends to become too physically challenging for those beyond 80. People worry a lot about medical costs beyond 80, but the numbers indicate that overall inflation-adjusted spending still tends to drop throughout retirees' 80s.
“It's a dangerous business, Frodo, going out your door. You step onto the road, and if you don't keep your feet, there's no knowing where you might be swept off to.” J.R.R. Tolkien,The Lord of the Rings

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Re: Fear of dying with too much money?

Post by sunnywindy » Sat Jan 20, 2018 4:46 pm

I don't subscribe to the theory that money or too much money is the problem. It has more to do with looking back at one's life and wondering if you did all that you could have. Money is just something to assign blame.
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Re: Fear of dying with too much money?

Post by midareff » Sat Jan 20, 2018 4:46 pm

willthrill81 wrote:
Sat Jan 20, 2018 4:34 pm
midareff wrote:
Sat Jan 20, 2018 4:06 pm
I'm much more concerned with matching my WR and spending curve to the Go-Go phase of retirement I'm in @ 70 y/o, and like to travel. From my own observations of my slowly diminishing physical abilities and observing those on trips around me the later 70's to 80 is about is far as active travel gets. By active I mean getting off the cruise ship and spending 4-6 hours walking around the town with a lunch break in the middle. Perhaps we could call it an active Viking River Cruiser.
My thoughts are similar. I've been advising my parents, both in their late 60s, who really enjoy traveling to do what they realistically can now while they are physically able. As you note, globe trotting tends to become too physically challenging for those beyond 80. People worry a lot about medical costs beyond 80, but the numbers indicate that overall inflation-adjusted spending still tends to drop throughout retirees' 80s.
I see different crowds on different trips. International travel (not the Caribbean) is a more venturesome and a better group condition wise. Late 50's to early 70's. USA riverboat travel is a bit older and a bit less capable. The Caribbean stuff round trip out of Miami or Fort Lauderdale is just a depressing group on some lines. I'd tell anyone in their late 60's to go Viking.... no if's ands or buts if it is affordable to them. Can recommend a Travel Agent if you want to PM.

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Re: Fear of dying with too much money?

Post by Dottie57 » Sat Jan 20, 2018 4:50 pm

randomizer wrote:
Sat Jan 20, 2018 2:39 pm
I am nowhere near having that fear, nor do I fear ever developing the fear. :D
+1

I can't imagine having this fear.

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Re: Fear of dying with too much money?

Post by 1210sda » Sat Jan 20, 2018 4:57 pm

willthrill81 wrote:
Sat Jan 20, 2018 2:42 pm
Personally, if my portfolio tripled over the course of the first 20 years of retirement, I believe that fear would become very real for me.
With a 4%WR, and a linear (i.e. no sequence of returns effect) 9.25% cagr for 20 years and you would triple your beginning portfolio.

:sharebeer :moneybag

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Re: Fear of dying with too much money?

Post by staythecourse » Sat Jan 20, 2018 5:01 pm

I think WCI is running out of stuff to talk about.

If one has fear of dying with too much money the treatment is simple... Live on the proverty level for a month. Then see if that fear still exists.

Boy, are we running out of stuff to talk about? How about the fear of having too efficient of a portfolio? Or how about the fear of being too good looking? Or how about the fear of being too intelligent?

Good luck.
"The stock market [fluctuation], therefore, is noise. A giant distraction from the business of investing.” | -Jack Bogle

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Re: Fear of dying with too much money?

Post by DrGoogle2017 » Sat Jan 20, 2018 5:13 pm

Fear of dying is more real than FODWTMM.

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Re: Fear of dying with too much money?

Post by Archimedes » Sat Jan 20, 2018 5:20 pm

It is highly likely that I will die with a ton of unspent assets. At this stage of life I don't need to work for financial reasons, but I do like my work and I need to keep busy and productive and contribute to maintain my mental health. The consequence is I keep earning lots of money that I don't need. And we already do spend money on lots of wants that are not needs. We give significant sums to charity, but we don't give more because there is always that fear of the future being unpredictable.

So, as I budget and plan for times both good and bad, with a big reserve for the bad, I am likely going to die with way too much money. There are worse things that could happen. To me, the money is there to make me secure and comfortable. When I am gone, it will likely be way too much for my heirs, but as I get closer to kicking the bucket maybe I will change my estate plan.

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Re: Fear of dying with too much money?

Post by willthrill81 » Sat Jan 20, 2018 5:21 pm

staythecourse wrote:
Sat Jan 20, 2018 5:01 pm
If one has fear of dying with too much money the treatment is simple... Live on the proverty level for a month. Then see if that fear still exists.
From 2005-2009, my DW and I lived at the poverty line for four years. We had a paid for vehicle that cost us very little to maintain during that period, but we paid monthly rent and everything else just fine. We ate out once or twice a week, took some inexpensive vacations, and even saved up $5k for a trip to Hawaii at the end. Life was good.

I see Passive Income MD's point: I don't want to die with unfulfilled aspirations that money could have helped with if I had plenty of money with which to do it. I wouldn't call that a real fear at this point, but I don't want to be the richest guy in the cemetery.
“It's a dangerous business, Frodo, going out your door. You step onto the road, and if you don't keep your feet, there's no knowing where you might be swept off to.” J.R.R. Tolkien,The Lord of the Rings

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Re: Fear of dying with too much money?

Post by willthrill81 » Sat Jan 20, 2018 5:26 pm

Archimedes wrote:
Sat Jan 20, 2018 5:20 pm
It is highly likely that I will die with a ton of unspent assets. At this stage of life I don't need to work for financial reasons, but I do like my work and I need to keep busy and productive and contribute to maintain my mental health.
If you truly enjoy your work and would do it for free (that's a good litmus test to see how well you really like it), then by all means keep working.
Archimedes wrote:
Sat Jan 20, 2018 5:20 pm
The consequence is I keep earning lots of money that I don't need. And we already do spend money on lots of wants that are not needs. We give significant sums to charity, but we don't give more because there is always that fear of the future being unpredictable.
This is in conflict with your above statement. The future is always unpredictable, but that doesn't mean you need every dollar you can possibly get your hands on either. Reading between the lines, you seem to believe that you really need more money to ensure you'll always have enough, but then you say that you're working just to "keep busy and productive." Perhaps both are true, but I sense that they are not. Many in your position probably feel the same way.

If the fear of running out of money is real for you, then maybe you should consider just leaving a portion of your estate to charity rather than giving it before you pass.
“It's a dangerous business, Frodo, going out your door. You step onto the road, and if you don't keep your feet, there's no knowing where you might be swept off to.” J.R.R. Tolkien,The Lord of the Rings

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Re: Fear of dying with too much money?

Post by 1nv35t » Sat Jan 20, 2018 5:52 pm

Dying with residual money ... success.
Dying after having run out of money ... failure.
Excepting heirs, I have little concern about how successfully that might have been achieved.

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Re: Fear of dying with too much money?

Post by willthrill81 » Sat Jan 20, 2018 5:54 pm

1nv35t wrote:
Sat Jan 20, 2018 5:52 pm
Dying with residual money ... success.
Dying after having run out of money ... failure.
Excepting heirs, I have little concern about how successfully that might have been achieved.
While not as severe as running out of money before running out of life, I don't how I would classify someone with a $1.5 million portfolio scraping by on $30k a year in retirement for FOROOM. That doesn't smell like success to me.
“It's a dangerous business, Frodo, going out your door. You step onto the road, and if you don't keep your feet, there's no knowing where you might be swept off to.” J.R.R. Tolkien,The Lord of the Rings

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Re: Fear of dying with too much money?

Post by BigJohn » Sat Jan 20, 2018 5:57 pm

willthrill81 wrote:
Sat Jan 20, 2018 2:42 pm
Personally, if my portfolio tripled over the course of the first 20 years of retirement, I believe that fear would become very real for me.
Why worry until that happens? If it happens, do something about it like find a worthy charity or two or three and volunteer with them to ensure your money is well spent.

I may or may not accumulate more than I think my kids need to inherit. This is my plan if I’m fortunate enough to be in that situation.

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Re: Fear of dying with too much money?

Post by staythecourse » Sat Jan 20, 2018 6:01 pm

willthrill81 wrote:
Sat Jan 20, 2018 5:21 pm
staythecourse wrote:
Sat Jan 20, 2018 5:01 pm
If one has fear of dying with too much money the treatment is simple... Live on the proverty level for a month. Then see if that fear still exists.
From 2005-2009, my DW and I lived at the poverty line for four years. We had a paid for vehicle that cost us very little to maintain during that period, but we paid monthly rent and everything else just fine. We ate out once or twice a week, took some inexpensive vacations, and even saved up $5k for a trip to Hawaii at the end. Life was good.

I see Passive Income MD's point: I don't want to die with unfulfilled aspirations that money could have helped with if I had plenty of money with which to do it. I wouldn't call that a real fear at this point, but I don't want to be the richest guy in the cemetery.
That is under the assumption you are denying yourself. The best thing to do is sit down and think of the 10 most material things you really want in life. Then fold it up and look at it every year. Start with the cheapest and buy it. Then each year run down the list. Then by the 10th year of retirement you will be done.

My assumption, as a doctor who sees a lot of folks in different life cycles is that I have NEVER seen one person near death who even thought about what they did or did not buy in their life. I have one patient right now who called who will likely die before the weekend is up and who owns his own business. The only fear they had was either 1. Not spending enough time with family and/ or 2. Not having better health. Those 2 things luckily cost no money just time and effort.

Good luck.
"The stock market [fluctuation], therefore, is noise. A giant distraction from the business of investing.” | -Jack Bogle

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Re: Fear of dying with too much money?

Post by Grt2bOutdoors » Sat Jan 20, 2018 6:05 pm

Living in a high tax state eliminates any such fear of having too much.
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Re: Fear of dying with too much money?

Post by KlangFool » Sat Jan 20, 2018 6:05 pm

willthrill81 wrote:
Sat Jan 20, 2018 5:54 pm
1nv35t wrote:
Sat Jan 20, 2018 5:52 pm
Dying with residual money ... success.
Dying after having run out of money ... failure.
Excepting heirs, I have little concern about how successfully that might have been achieved.
While not as severe as running out of money before running out of life, I don't how I would classify someone with a $1.5 million portfolio scraping by on $30k a year in retirement for FOROOM. That doesn't smell like success to me.
willthrill81,

Why should that person care about your opinion? In fact, the definition of success is to be able to live your life according to your own opinion and value system. Anyone that care too much about other's opinion is a failure regardless of how much money that they have.

KlangFool

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Re: Fear of dying with too much money?

Post by nedsaid » Sat Jan 20, 2018 6:09 pm

Right now, fear of dying with too much money is not a problem for me. I am concerned about having enough. If it turned out that my nest egg was getting too large, I would donate more to charitable causes. Leaving too much to family members can cause more problems than it solves.
A fool and his money are good for business.

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Re: Fear of dying with too much money?

Post by willthrill81 » Sat Jan 20, 2018 6:10 pm

KlangFool wrote:
Sat Jan 20, 2018 6:05 pm
willthrill81 wrote:
Sat Jan 20, 2018 5:54 pm
1nv35t wrote:
Sat Jan 20, 2018 5:52 pm
Dying with residual money ... success.
Dying after having run out of money ... failure.
Excepting heirs, I have little concern about how successfully that might have been achieved.
While not as severe as running out of money before running out of life, I don't how I would classify someone with a $1.5 million portfolio scraping by on $30k a year in retirement for FOROOM. That doesn't smell like success to me.
willthrill81,

Why should that person care about your opinion? In fact, the definition of success is to be able to live your life according to your own opinion and value system. Anyone that care too much about other's opinion is a failure regardless of how much money that they have.

KlangFool
My point was that a life of truly unnecessary deprivation due to FOROOM doesn't appeal to me, and there are many others for whom this holds no appeal either. If someone does want to go that route, then by all means they have every right to do so and ignore what anyone else thinks.

Your first sentence seems accusatory of me being presumptuous, but your last sentence seems very presumptuous to me. I really care what my family's opinions are.
“It's a dangerous business, Frodo, going out your door. You step onto the road, and if you don't keep your feet, there's no knowing where you might be swept off to.” J.R.R. Tolkien,The Lord of the Rings

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Re: Fear of dying with too much money?

Post by Sandtrap » Sat Jan 20, 2018 6:11 pm

I've been blessed with more than enough.
So I invest for the security of an educational "legacy" trust for my hares . . . and the hares of my hares.. . and their hares :shock: .
j :D
Last edited by Sandtrap on Sat Jan 20, 2018 6:12 pm, edited 1 time in total.

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Re: Fear of dying with too much money?

Post by willthrill81 » Sat Jan 20, 2018 6:11 pm

nedsaid wrote:
Sat Jan 20, 2018 6:09 pm
Right now, fear of dying with too much money is not a problem for me. I am concerned about having enough. If it turned out that my nest egg was getting too large, I would donate more to charitable causes. Leaving too much to family members can cause more problems than it solves.
How would you know that your nest egg was getting too large?
“It's a dangerous business, Frodo, going out your door. You step onto the road, and if you don't keep your feet, there's no knowing where you might be swept off to.” J.R.R. Tolkien,The Lord of the Rings

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Re: Fear of dying with too much money?

Post by willthrill81 » Sat Jan 20, 2018 6:13 pm

Sandtrap wrote:
Sat Jan 20, 2018 6:11 pm
I've been blessed with more than enough.
So I invest for the security of an educational "legacy" trust for my hares . . . and the hares of my hares.. . and their hares.
j :D
Ummm....you must really like your pets, huh? :wink:

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“It's a dangerous business, Frodo, going out your door. You step onto the road, and if you don't keep your feet, there's no knowing where you might be swept off to.” J.R.R. Tolkien,The Lord of the Rings

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Re: Fear of dying with too much money?

Post by IlliniDave » Sat Jan 20, 2018 6:15 pm

willthrill81 wrote:
Sat Jan 20, 2018 5:54 pm

While not as severe as running out of money before running out of life, I don't how I would classify someone with a $1.5 million portfolio scraping by on $30k a year in retirement for FOROOM. That doesn't smell like success to me.
I "scrape by" on $30K a year (okay, well, I've averaged a little over $31K over the last four years, so not quite $30K) and am quite happy with my lifestyle. Much happier than I was when tossing $20-bills out the window with great abandon everywhere I went in my misspent younger years. That's while still working and it represents less than 20% of my gross income (i.e., it's a choice not a constraint). I plan on spending a little more than that in retirement, but not a whole lot. I get to define success for me. :beer
Last edited by IlliniDave on Sat Jan 20, 2018 6:20 pm, edited 1 time in total.
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Re: Fear of dying with too much money?

Post by willthrill81 » Sat Jan 20, 2018 6:19 pm

IlliniDave wrote:
Sat Jan 20, 2018 6:15 pm
willthrill81 wrote:
Sat Jan 20, 2018 5:54 pm

While not as severe as running out of money before running out of life, I don't how I would classify someone with a $1.5 million portfolio scraping by on $30k a year in retirement for FOROOM. That doesn't smell like success to me.
I "scrape by" on $30K a year (okay, well, I've averaged a little over $31K over the last four years, so not quite $30K) and am quite happy with my lifestyle. Much happier than I was when tossing $20-bills out the window with great abandon everywhere I went in my misspent younger years. That's while still working and it represents less than 20% of my gross income. I plan on spending a little more than that in retirement, but not a whole lot. I get to define success for me. :beer
Good for you! :D

Sadly, there are many places in the U.S. where $30k is really on the low end of feasible.

My MiL lives on about $12k, but she really is scraping by and occasionally has to use savings to fund shortfalls. But she's content, so I guess that's fine.
“It's a dangerous business, Frodo, going out your door. You step onto the road, and if you don't keep your feet, there's no knowing where you might be swept off to.” J.R.R. Tolkien,The Lord of the Rings

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GerryL
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Re: Fear of dying with too much money?

Post by GerryL » Sat Jan 20, 2018 6:24 pm

Dying with "too much money" is not a fear. I just take it for granted that I will. It was a bit disconcerting when I realized that this would be my fate, barring horrible health issues, but it has given me the freedom to be more generous with others and with myself. And I don't in any way regret my frugal lifestyle that has helped me arrive at this place.

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nedsaid
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Re: Fear of dying with too much money?

Post by nedsaid » Sat Jan 20, 2018 6:25 pm

willthrill81 wrote:
Sat Jan 20, 2018 6:11 pm
nedsaid wrote:
Sat Jan 20, 2018 6:09 pm
Right now, fear of dying with too much money is not a problem for me. I am concerned about having enough. If it turned out that my nest egg was getting too large, I would donate more to charitable causes. Leaving too much to family members can cause more problems than it solves.
How would you know that your nest egg was getting too large?
That is not a problem right now. The nest egg would be too large if I could pay for many years of long term care without risk of exhausting the portfolio. Most who need it, need 3-5 years. I would also look at what I could realistically leave family members without destroying their lives. Another indicator would be if the portfolio generated income and capital gains year after year far in excess of what is needed to maintain my lifestyle. Trying to get to my first million, having many millions doesn't seem to be in the cards right now. This is not going to be a problem for most people.
A fool and his money are good for business.

IlliniDave
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Re: Fear of dying with too much money?

Post by IlliniDave » Sat Jan 20, 2018 6:37 pm

willthrill81 wrote:
Sat Jan 20, 2018 6:19 pm

Good for you! :D

Sadly, there are many places in the U.S. where $30k is really on the low end of feasible.

My MiL lives on about $12k, but she really is scraping by and occasionally has to use savings to fund shortfalls. But she's content, so I guess that's fine.
Probably so. I am lucky that I am not drawn to amenities unique to HCOL areas I suppose.The median household income was in the $50-$60K range last time I checked. Being a household of 1 and spending $31K (equivalent to maybe $33-$34K pretax) puts me pretty comparable to the median on a per capita basis. It sounds worse than it actually is. A bonus to enjoying a humble lifestyle is that one can be wealthy with a lot less money, and it's a great enabler for someone contemplating early retirement.

I don't think I'm strong enough to survive contentedly on what your MIL does, I would agree that that income level is in the scraping by category--certainly would be for me. I have my creature comforts and little luxuries that giving up would make me less happy.
Don't do something. Just stand there!

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Re: Fear of dying with too much money?

Post by bigred77 » Sat Jan 20, 2018 6:38 pm

Dying with too much money is a symptom of a problem I do perceive on Bogleheads and that’s the pursuit of absolute economic certainty regardless of cost.

That cost comes in the form of working additional years unnecessarily. It comes in the form of depriving oneself of experiences, conveniences, or other wants they could reasonably afford if they didn’t pursue a sub 3% withdrawal rate. It comes in the form of being excessively conservative in their choices, assumptions, and economic decisions throughout their life.

If you make gobs and gobs of money, it’s really no big deal. If you love your job, it’s no big deal. If you are truly content with your life and standard of living, it’s no big deal. But I read some posts and can absolutely tell the pursuit of economic certainty has impacted their life negatively. It’s a first world problem if there ever was one but it’s there nonetheless.

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Re: Fear of dying with too much money?

Post by Allan » Sat Jan 20, 2018 6:39 pm

Sandtrap wrote:
Sat Jan 20, 2018 6:11 pm
I've been blessed with more than enough.
So I invest for the security of an educational "legacy" trust for my hares . . . and the hares of my hares.. . and their hares :shock: .
j :D
You can't have too much money for hares, especially when they are multiplying like rabbits :)

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Re: Fear of dying with too much money?

Post by KlangFool » Sat Jan 20, 2018 6:40 pm

willthrill81 wrote:
Sat Jan 20, 2018 6:10 pm
KlangFool wrote:
Sat Jan 20, 2018 6:05 pm
willthrill81 wrote:
Sat Jan 20, 2018 5:54 pm
1nv35t wrote:
Sat Jan 20, 2018 5:52 pm
Dying with residual money ... success.
Dying after having run out of money ... failure.
Excepting heirs, I have little concern about how successfully that might have been achieved.
While not as severe as running out of money before running out of life, I don't how I would classify someone with a $1.5 million portfolio scraping by on $30k a year in retirement for FOROOM. That doesn't smell like success to me.
willthrill81,

Why should that person care about your opinion? In fact, the definition of success is to be able to live your life according to your own opinion and value system. Anyone that care too much about other's opinion is a failure regardless of how much money that they have.

KlangFool
My point was that a life of truly unnecessary deprivation due to FOROOM doesn't appeal to me, and there are many others for whom this holds no appeal either. If someone does want to go that route, then by all means they have every right to do so and ignore what anyone else thinks.

Your first sentence seems accusatory of me being presumptuous, but your last sentence seems very presumptuous to me. I really care what my family's opinions are.
willthrill81,

1) You express your opinion of what success is.

2) I express my opinion of what success is.

<< My point was that a life of truly unnecessary deprivation due to FOROOM doesn't appeal to me, and there are many others for whom this holds no appeal either. >>

3) And, why does any of this matters? Isn't the whole point of having money is the freedom to do whatever you want with your own money?

4) My annual expense with the mortgage is about 60K per year. My annual expense without the mortgage is about 45K. I plan to spend the same amount of money when I retired. This is the lifestyle that I want to live in. So, I have no idea whatever you meant by deprivation.

5) I plan to give whatever amount that my children should get from me before I die. So, this solves the inheritance question too.

6) As for the rest, I do not care whatever happened to it when I died.

KlangFool

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steve roy
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Re: Fear of dying with too much money?

Post by steve roy » Sat Jan 20, 2018 6:47 pm

2b2 wrote:
Sat Jan 20, 2018 3:51 pm
How much is too much?
If one dies with $100 in a checking account, is that "dying with too much money"?

2b2
Remember the words of Errol Flynn: “Any man who dies with more than five thousand dollars to his name is a FAILURE.”

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Re: Fear of dying with too much money?

Post by DrGoogle2017 » Sat Jan 20, 2018 6:47 pm

wrote:
Sat Jan 20, 2018 5:54 pm
wrote:
Sat Jan 20, 2018 5:52 pm
Dying with residual money ... success.
Dying after having run out of money ... failure.
Excepting heirs, I have little concern about how successfully that might have been achieved.
While not as severe as running out of money before running out of life, I don't how I would classify someone with a $1.5 million portfolio scraping by on $30k a year in retirement for FOROOM. That doesn't smell like success to me.
Maybe you should watch Fisher Investment commercial sometime. “It’s brutal to run out of money when you are old”.

IlliniDave
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Re: Fear of dying with too much money?

Post by IlliniDave » Sat Jan 20, 2018 6:51 pm

GerryL wrote:
Sat Jan 20, 2018 6:24 pm
Dying with "too much money" is not a fear. I just take it for granted that I will. It was a bit disconcerting when I realized that this would be my fate, barring horrible health issues, but it has given me the freedom to be more generous with others and with myself. And I don't in any way regret my frugal lifestyle that has helped me arrive at this place.
This is pretty much how I see it. If things go roughly similar to assumptions I built into my plan, I'll be worth more when I die than when I retire. But having two kids, 4 grandchildren, and a fifth in the oven due next August (and being "only" 53), I feel an old-fashioned patriarchal responsibility to be at least part of a financial backstop for the family which will likely produce an additional generation before the actuarial tables say my time will expire. Being careful with money affords me a good chance to live up to that responsibility and is a trade I'd do over again (and will continue to make going forward).
Don't do something. Just stand there!

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Phineas J. Whoopee
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Re: Fear of dying with too much money?

Post by Phineas J. Whoopee » Sat Jan 20, 2018 7:03 pm

I do not fear the prospect of being dead, any more than I am traumatized by memories of the time during which I was not yet born.

The dying process bothers me in certain ways. I've tried to mitigate them but I may not have sufficient control for my steps to make a material difference.

Should I come through the process and be dead with an estate of whatever size somebody or other perceives as too much, I will not feel really, really bad inside.

PJW

delamer
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Re: Fear of dying with too much money?

Post by delamer » Sat Jan 20, 2018 7:31 pm

Your post seems pretty glib about the prospect of running out of money.

Yes, no one is going run out of money if they limit withdrawals to 5% of the prior year’s ending balance. But that in no way guarantees that they will enough money to live comfortably or even pay their basic bills. Same with “no sane person will draw down a portfolio until it is exhausted.” Well, maybe they will have to in order to support themselves.

There are some situations that are very unlikely but extremely expensive. One regular poster here has a wife who had a severe stroke, and the costs and difficulties of managing her situation are high. Not to mention the unknowns of prognosis.

No fear of dying with too much money for me. Just a lack of fear of not having enough to live on.

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Re: Fear of dying with too much money?

Post by willthrill81 » Sat Jan 20, 2018 7:37 pm

delamer wrote:
Sat Jan 20, 2018 7:31 pm
Your post seems pretty glib about the prospect of running out of money.
That was certainly not my intent. But many Bogleheads have made a point that actually exhausting a sizable portfolio during retirement is something so rare as to not be a very realistic possibility for those reading this forum.

It could be said that many are 'glib' about the prospect of people working many additional years doing something they don't truly enjoy for an extra margin of safety on top of other margins of safety that they already have.

There are two ditches on both sides of the road. Running out of money is indeed serious, but as I already noted, I've seen a family disintegrate due to a large inheritance. I think that many would agree that both outcomes are unacceptable.
“It's a dangerous business, Frodo, going out your door. You step onto the road, and if you don't keep your feet, there's no knowing where you might be swept off to.” J.R.R. Tolkien,The Lord of the Rings

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