KlangFool wrote: EnjoyIt wrote: Hawaiishrimp wrote:
EnjoyIt wrote:For all you people that said "growth in the accounts exceeded wages from work"
Why are you still working?
Uh... because stocks may go down tomorrow..
uh... won't they come back up? shouldn't you have some fixed income sources to ride out a storm? I know, I know some bogleheads are very conservative and are looking to retire with 2% withdrawals. Personally I think its a little nuts, but whatever makes you happy is probably what is important. If I had 50x I would probably double my spending and then cut back if times become rough. Maybe not fly first class on my next trip to the Galapagos Islands.
If your portfolio is growing every year more than your wages,
not only have you won the game, you demolished it.
Unless you have a windfall of some sort, your portfolio will have to grow for many years until it is big enough for this to happen. And, when your portfolio growth exceed more that your wages every now and then, you are very close to 25X and 33X. And, when you reach 25X and/or 33X, you may choose to retire at that moment as opposed to working longer. Due to all those reasons, people do not reach 50X.
I am facing this question now. I am approximately 20X now. If the market growth stays at the current pace, it might be the first year where it exceeds my wages. At my case, it probably will never reach 50X unless I have a windfall. I would retire before then. Life is too short!!
I'm not clear on how (or perhaps why) you are assigning this somewhat arbitrary multiple of wages and claiming that this means one "has enough." Let me explain.
Our gross wages are $240k. However, our spending is much, much less than that, even accounting for taxes. In our case, after retirement and taxable savings, our expenses are approx $84k. That, however, includes the costs associated with a mortgage, and with two children: food, clothing, two extra airline seats, activities, and so on.
In retirement, our (projected) expenses will not include a) kids living at home (one hopes) b) a mortgage c) retirement and non-retirement savings and so on.
So, point being that yes, if I wanted to stop working tomorrow I might need $6m (25x wages). But most people are not going to have the same level of expenses (much less the same savings rate or tax rate) when they stop working.
All that one needs when one is considering "their number" is a portfolio that supports a SWR (whatever one thinks that should be) that supports their lifestyle AT THAT TIME. Not whatever their wages are at present.
Do you disagree?