How much money do you want to retire?

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frugalecon
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Re: How much money do you want to retire?

Post by frugalecon » Thu Sep 27, 2018 5:43 pm

wrongfunds wrote:
Thu Sep 27, 2018 4:59 pm
Let us run some numbers for $100k+$100k professional couple. If they have been able to fully contribute to 401K, IRA, HSA etc then they have never even seen (approx) 24+24+11+7 = 66K of that paycheck. Add Medicare (7+7) and SS taxes (3K) to the money never saw column. That makes it $83K vanished from the yearly paycheck. That leaves the couple with $117K to pay all other taxes and household expenses and mortgage and tuition and after tax savings etc.

If this couple has been used to keep their heads above water; then they should in theory have no trouble being able to live very comfortably, might even lavishly, at $117K *if* they are done with mortgage and kids colleges. Actually that sounds like insane amount of money to me with no mortgage and no tuition bills to pay it from!

Being professional couple working for many years, we will estimate they will be able to get around $30K each at FRA. Now they need to be able to support (117-30-30) = $67K from their invest-able assets. With assumed 4%, the couple needs to have $1.67M of assets. Now that sounds like a big number but if they were fully funding their retirement account for many years in the past as I assumed before, this number should be reachable.

Here is my answer; We want $1.67M to retire :-)

Anybody wants to poke holes in the calculations?
The only hole I will poke is that 117 - 30 - 30 is $57k, so you have overestimated the investable assets that are needed. This is somewhat similar to my household’s situation, and I anticipate living comfortably, even lavishly! Having no mortgage, no OASDI taxes, no Medicare taxes, and no more backdoor Roth contributions opens up a lot of space in the budget.

wrongfunds
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Re: How much money do you want to retire?

Post by wrongfunds » Thu Sep 27, 2018 7:28 pm

Oops, I am really red faced with that error! So that drops the required assets to $1.425M, under the psychological (and artificial) barrier of $1.5M.

I think the point not said behind the hypothetical scenario is that one needs to control the expenses and let the investment money come straight out from the paycheck which will allow continued life style in retirement.

letsgobobby
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Re: How much money do you want to retire?

Post by letsgobobby » Thu Sep 27, 2018 8:16 pm

Deleted
Last edited by letsgobobby on Fri Apr 26, 2019 2:19 pm, edited 1 time in total.

GeoffD
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Re: How much money do you want to retire?

Post by GeoffD » Thu Sep 27, 2018 8:56 pm

BoglePablo wrote:
Thu Sep 27, 2018 4:18 pm
wrongfunds wrote:
Thu Jun 07, 2018 8:01 am
A typical suburban house with 2500 sqft and 4 bedrooms will have taxes around $12K in Bostom Metrowest area *WITH* good school system. I live about 40 miles from Boston and my taxes for that house are over $13K. The assessed price is around $700K. My RE portion had been always higher than PI since the day we purchased the house 20 years ago!
NW Chicago suburb, 25 mi from city, great school district, 3000 sq ft 4 bedroom house, $12k annual property tax. Pretty typical in this area
I did the math at age 50, applied the shrink ray to my housing, and picked a town with a low mill rate. $2,500 property tax bill. The house I used to own in Winchester Ma just north of Boston now has a $30,000 property tax bill.

edgeagg
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Location: WA-US

Re: How much money do you want to retire?

Post by edgeagg » Thu Sep 27, 2018 9:18 pm

GeoffD wrote:
Thu Sep 27, 2018 8:56 pm
I did the math at age 50, applied the shrink ray to my housing, and picked a town with a low mill rate. $2,500 property tax bill. The house I used to own in Winchester Ma just north of Boston now has a $30,000 property tax bill.
Your house was worth $1.58M in assessed value? The property tax in Worcester seems to be insane in that case. WTF do they do with all of that money? We live in WA - just outside Redmond, WA and our rates are half of yours - even without a state income tax.

marcopolo
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Re: How much money do you want to retire?

Post by marcopolo » Thu Sep 27, 2018 9:42 pm

wrongfunds wrote:
Thu Sep 27, 2018 4:59 pm
Let us run some numbers for $100k+$100k professional couple. If they have been able to fully contribute to 401K, IRA, HSA etc then they have never even seen (approx) 24+24+11+7 = 66K of that paycheck. Add Medicare (7+7) and SS taxes (3K) to the money never saw column. That makes it $83K vanished from the yearly paycheck. That leaves the couple with $117K to pay all other taxes and household expenses and mortgage and tuition and after tax savings etc.

If this couple has been used to keep their heads above water; then they should in theory have no trouble being able to live very comfortably, might even lavishly, at $117K *if* they are done with mortgage and kids colleges. Actually that sounds like insane amount of money to me with no mortgage and no tuition bills to pay it from!

Being professional couple working for many years, we will estimate they will be able to get around $30K each at FRA. Now they need to be able to support (117-30-30) = $67K from their invest-able assets. With assumed 4%, the couple needs to have $1.67M of assets. Now that sounds like a big number but if they were fully funding their retirement account for many years in the past as I assumed before, this number should be reachable.

Here is my answer; We want $1.67M to retire :-)

Anybody wants to poke holes in the calculations?
wrongfunds wrote:
Thu Sep 27, 2018 7:28 pm
Oops, I am really red faced with that error! So that drops the required assets to $1.425M, under the psychological (and artificial) barrier of $1.5M.

I think the point not said behind the hypothetical scenario is that one needs to control the expenses and let the investment money come straight out from the paycheck which will allow continued life style in retirement.

I think the math makes a lot of sense in theory. I think in practice, it is very unlikely that one could/would retire with that level of assets given the scenario described. I thing the issue is one of timing.

Even if the hypothetical couple got a fairly late start at savings, let's say they are 40 when they start this plan, with no prior savings. With that level of savings, they would likely hit the target number somewhere in their mid-fifties. The problem at that point s that they would need a LOT more money to maintain their lifestyle because SS is still 10-15 years away, and they also need to think about health insurance for 10 years. Conversely, if they wait until medicare?=/SS FRA age and continue their savings, they will end up with a LOT more money, which they may not need. They may retire somewhere between those two extremes, but it seem unlikely they would retire with the target amount as descried above.
Once in a while you get shown the light, in the strangest of places if you look at it right.

bluelight
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Re: How much money do you want to retire?

Post by bluelight » Thu Sep 27, 2018 9:44 pm

I'm 3 months shy of 62, DH is 72 and has been retired for a number of years. I'd like to have 3M in retirement, we are about 60K short of that excluding our 550K house (no mortgage).

Our retirement income (pensions, SS and dividends) should come close to covering our retirement expenses within 10-20K per year.

I waffle between I'm done with work, I should work another 6 months, I should work another year.

wrongfunds
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Re: How much money do you want to retire?

Post by wrongfunds » Thu Sep 27, 2018 9:55 pm

bluelight wrote:
Thu Sep 27, 2018 9:44 pm
I'm 3 months shy of 62, DH is 72 and has been retired for a number of years. I'd like to have 3M in retirement, we are about 60K short of that excluding our 550K house (no mortgage).

Our retirement income (pensions, SS and dividends) should come close to covering our retirement expenses within 10-20K per year.

I waffle between I'm done with work, I should work another 6 months, I should work another year.
I do not get you at all! In the scheme of the thing, that 60K is really rounding off error. If your retirement expense are near 200K (I came up with this number because of 4% of 3M + SS +SS + pension). then surely that 60K is drop in the bucket. It is literally 2% of your portfolio and your portfolio fluctuate by that much every single week.

Peppergrass
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Re: How much money do you want to retire?

Post by Peppergrass » Thu Sep 27, 2018 11:35 pm

I'm 34. goal is 444 million in life.. problem being I don't have people's definition of retirement.. to me.... and this is me.....retirement is for people who hate what they do, you should be "working" till you die
Last edited by Peppergrass on Thu Sep 27, 2018 11:46 pm, edited 1 time in total.

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Hyperborea
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Re: How much money do you want to retire?

Post by Hyperborea » Thu Sep 27, 2018 11:39 pm

Peppergrass wrote:
Thu Sep 27, 2018 11:35 pm
I'm 34. goal is 444 million
I don't think anybody with goals that high will ever retire. First, most people will never get there. Second, those that do have far too much ego tied up in their money and "skill" in getting there to ever retire.
It’s hard to win an argument with a smart person, it's damn near impossible to win an argument with a stupid person. - Bill Murray

wrongfunds
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Re: How much money do you want to retire?

Post by wrongfunds » Thu Sep 27, 2018 11:41 pm

Peppergrass wrote:
Thu Sep 27, 2018 11:35 pm
I'm 34. goal is 444 million
The answer is 42

Peppergrass
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Re: How much money do you want to retire?

Post by Peppergrass » Thu Sep 27, 2018 11:53 pm

Hyperborea wrote:
Thu Sep 27, 2018 11:39 pm
Peppergrass wrote:
Thu Sep 27, 2018 11:35 pm
I'm 34. goal is 444 million
I don't think anybody with goals that high will ever retire. First, most people will never get there. Second, those that do have far too much ego tied up in their money and "skill" in getting there to ever retire.
totally agree with that, which is why I was editing my answer when you wrote.. I don't believe in retirement for me... does it exists , sure I guess to people, but I have a different view on life, which is a constant and never ending improvement and to be honest, working harder and harder as life goes on. you climb and reach that rung that looked so far away and when you get there you realize there is a limitless amount more to climb

agree, most won't, and I don't think most even want to, for whatever reason. for me I knew I came down to have gobs of money, and to speak frankly, I have not met another person who literally has said the same or feels the same, yet..

I mostly agree. but to me I believe this is healthy.. try watching tv for a month.. it gets really BORING... maybe that's just me, which I know people are going to tell me that's not what retirement is, but with those low numbers it's not like you're traveling the world for years and have top service.. that's a budget of cable tv and pizza

I like setting high goals,, it pushes you farther, while if you don't hit it you most likely get pretty dang far

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HomerJ
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Re: How much money do you want to retire?

Post by HomerJ » Thu Sep 27, 2018 11:59 pm

bluelight wrote:
Thu Sep 27, 2018 9:44 pm
I'm 3 months shy of 62, DH is 72 and has been retired for a number of years. I'd like to have 3M in retirement, we are about 60K short of that excluding our 550K house (no mortgage).

Our retirement income (pensions, SS and dividends) should come close to covering our retirement expenses within 10-20K per year.

I waffle between I'm done with work, I should work another 6 months, I should work another year.
Why? Seriously, why?
The J stands for Jay

EddyB
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Re: How much money do you want to retire?

Post by EddyB » Fri Sep 28, 2018 12:01 am

Peppergrass wrote:
Thu Sep 27, 2018 11:53 pm
I like setting high goals,, it pushes you farther, while if you don't hit it you most likely get pretty dang far
Or it creates catastrophic failure. Or it comes at the expense of other dimensions (or even knowing those other dimensions exist any may merit their own goals).

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HomerJ
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Re: How much money do you want to retire?

Post by HomerJ » Fri Sep 28, 2018 12:21 am

Peppergrass wrote:
Thu Sep 27, 2018 11:53 pm
Hyperborea wrote:
Thu Sep 27, 2018 11:39 pm
Peppergrass wrote:
Thu Sep 27, 2018 11:35 pm
I'm 34. goal is 444 million
I don't think anybody with goals that high will ever retire. First, most people will never get there. Second, those that do have far too much ego tied up in their money and "skill" in getting there to ever retire.
totally agree with that, which is why I was editing my answer when you wrote.. I don't believe in retirement for me... does it exists , sure I guess to people, but I have a different view on life, which is a constant and never ending improvement and to be honest, working harder and harder as life goes on. you climb and reach that rung that looked so far away and when you get there you realize there is a limitless amount more to climb

agree, most won't, and I don't think most even want to, for whatever reason. for me I knew I came down to have gobs of money, and to speak frankly, I have not met another person who literally has said the same or feels the same, yet..

I mostly agree. but to me I believe this is healthy.. try watching tv for a month.. it gets really BORING... maybe that's just me, which I know people are going to tell me that's not what retirement is, but with those low numbers it's not like you're traveling the world for years and have top service.. that's a budget of cable tv and pizza

I like setting high goals,, it pushes you farther, while if you don't hit it you most likely get pretty dang far
What do you do for a living?
The J stands for Jay

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HomerJ
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Re: How much money do you want to retire?

Post by HomerJ » Fri Sep 28, 2018 12:30 am

Peppergrass wrote:
Thu Sep 27, 2018 11:53 pm
I like setting high goals,, it pushes you farther, while if you don't hit it you most likely get pretty dang far
Is it possible there are other high goals in life that don't revolve around making or even spending money?
The J stands for Jay

visualguy
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Re: How much money do you want to retire?

Post by visualguy » Fri Sep 28, 2018 12:41 am

Peppergrass wrote:
Thu Sep 27, 2018 11:35 pm
I'm 34. goal is 444 million in life.. problem being I don't have people's definition of retirement.. to me.... and this is me.....retirement is for people who hate what they do, you should be "working" till you die
You may not be able to work till you die even if you want to. The vast majority of retired people that I know didn't really retire voluntarily.

Peppergrass
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Re: How much money do you want to retire?

Post by Peppergrass » Fri Sep 28, 2018 12:50 am

HomerJ wrote:
Fri Sep 28, 2018 12:30 am
Peppergrass wrote:
Thu Sep 27, 2018 11:53 pm
I like setting high goals,, it pushes you farther, while if you don't hit it you most likely get pretty dang far
Is it possible there are other high goals in life that don't revolve around making or even spending money?
there are many.. and one could say they are more important then money, but what if you had them.. and MONEY ! that's an amazing life, not a great life but a super fulfilled crazy awesome life..

( friends, family, relationship, behavior, attitude, goals, sense of purpose, love, laughter, enjoyment, fulfillment, service to others, passion, spirituality, time, health, good habits, community, experiences... ... )


I don't know anyone given the choice would rather sit in the back fo the plane then fly up front, I don't know anyone given the choice would want to get a car because of price rather then because they want it... there are tons fo things money is great for.. never checking prices at the grocery store, going on a. trip and as long as you want for the experience doing it your way because you have the money..

I will totally be the first to admit a love of money more then most people, but I don't see it as a bad thing at all.. money provides me experiences I want to have and not forced to have.. that's not a bad thing ever.. if you chase money and you have your priorities in line, I see no problem with that.. heck people most likely waste more time watching tv and this and that then my quest to make more and more money.. we all do what we do down here, one of my drives is money and I will always be at the forefront to speak loudly.. there isn't one wrong thing with wanting money, only one thing is wanting money for money sake, I understand money provides you things and time and I use it accordingly

I believe anyone who says money "isn't that important" just hasen't seen how incredible a life can be with an abundance of.. of all things to be discussing this on a money related website should give us some clue.. .... if you have everything else "worthwhile" in life, why not add money to the list? what's the problem with that

secondly, money is being generated at an ever increasing speed then ever before.. no one in the past could ever become a billionaire overnight so quickly as one can today.. or at the speed people are hitting the billionaire list.. Heck we all know a million isn't special anymore even if you do have it.

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HomerJ
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Re: How much money do you want to retire?

Post by HomerJ » Fri Sep 28, 2018 1:14 am

Peppergrass wrote:
Fri Sep 28, 2018 12:50 am
if you have everything else "worthwhile" in life, why not add money to the list? what's the problem with that
No problem with that. But I think you will find out that time is a limited resource, and it's fairly difficult to achieve everything else worthwhile AND maximize wealth by working until you die.
( friends, family, relationship, behavior, attitude, goals, sense of purpose, love, laughter, enjoyment, fulfillment, service to others, passion, spirituality, time, health, good habits, community, experiences... ... )
It's a good list, but if you're NEVER satisfied with the amount of money you have and you plan to work until the day you die, you will have to make compromises somewhere on that list.

I submit there are diminishing returns to more money. Past a certain point, more money doesn't change your life as much as working on that list you posted above.
The J stands for Jay

randomguy
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Re: How much money do you want to retire?

Post by randomguy » Fri Sep 28, 2018 1:22 am

HomerJ wrote:
Thu Sep 27, 2018 11:59 pm
bluelight wrote:
Thu Sep 27, 2018 9:44 pm
I'm 3 months shy of 62, DH is 72 and has been retired for a number of years. I'd like to have 3M in retirement, we are about 60K short of that excluding our 550K house (no mortgage).

Our retirement income (pensions, SS and dividends) should come close to covering our retirement expenses within 10-20K per year.

I waffle between I'm done with work, I should work another 6 months, I should work another year.
Why? Seriously, why?
Hubby has a 150k/year pension that goes away when he dies? Thats about all I can come up with.

There is also a big fear of change thing for most people. If live is going good, why rock the boat?

casualflower
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Re: How much money do you want to retire?

Post by casualflower » Fri Sep 28, 2018 1:45 am

Peppergrass wrote:
Fri Sep 28, 2018 12:50 am
I don't know anyone given the choice would rather sit in the back fo the plane then fly up front, I don't know anyone given the choice would want to get a car because of price rather then because they want it... there are tons fo things money is great for.. never checking prices at the grocery store, going on a. trip and as long as you want for the experience doing it your way because you have the money..
Maybe no one tells you that money isn't important to them because you won't listen?

I drive a crappy car, 1/10 of what I could afford. I'm sometimes tempted, but it seems a waste, the expense, the depreciation, the extra insurance. But mostly, if I had a nicer car, I'd worry about spilling coffee on the seats, the dog shedding in it, or getting dented. If I were super-rich, I'd still worry about that. I see rich people get all upset when their toys break.

Happiness is a state of mind that is, for the most part, uncorrelated with money. Maybe you're happy continually striving for more. That's great. But not me. I'm content with what I have.

wrongfunds
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Re: How much money do you want to retire?

Post by wrongfunds » Fri Sep 28, 2018 7:21 am

marcopolo wrote:
Thu Sep 27, 2018 9:42 pm
wrongfunds wrote:
Thu Sep 27, 2018 4:59 pm
Let us run some numbers for $100k+$100k professional couple. If they have been able to fully contribute to 401K, IRA, HSA etc then they have never even seen (approx) 24+24+11+7 = 66K of that paycheck. Add Medicare (7+7) and SS taxes (3K) to the money never saw column. That makes it $83K vanished from the yearly paycheck. That leaves the couple with $117K to pay all other taxes and household expenses and mortgage and tuition and after tax savings etc.

If this couple has been used to keep their heads above water; then they should in theory have no trouble being able to live very comfortably, might even lavishly, at $117K *if* they are done with mortgage and kids colleges. Actually that sounds like insane amount of money to me with no mortgage and no tuition bills to pay it from!

Being professional couple working for many years, we will estimate they will be able to get around $30K each at FRA. Now they need to be able to support (117-30-30) = $67K from their invest-able assets. With assumed 4%, the couple needs to have $1.67M of assets. Now that sounds like a big number but if they were fully funding their retirement account for many years in the past as I assumed before, this number should be reachable.

Here is my answer; We want $1.67M to retire :-)

Anybody wants to poke holes in the calculations?
wrongfunds wrote:
Thu Sep 27, 2018 7:28 pm
Oops, I am really red faced with that error! So that drops the required assets to $1.425M, under the psychological (and artificial) barrier of $1.5M.

I think the point not said behind the hypothetical scenario is that one needs to control the expenses and let the investment money come straight out from the paycheck which will allow continued life style in retirement.

I think the math makes a lot of sense in theory. I think in practice, it is very unlikely that one could/would retire with that level of assets given the scenario described. I thing the issue is one of timing.

Even if the hypothetical couple got a fairly late start at savings, let's say they are 40 when they start this plan, with no prior savings. With that level of savings, they would likely hit the target number somewhere in their mid-fifties. The problem at that point s that they would need a LOT more money to maintain their lifestyle because SS is still 10-15 years away, and they also need to think about health insurance for 10 years. Conversely, if they wait until medicare?=/SS FRA age and continue their savings, they will end up with a LOT more money, which they may not need. They may retire somewhere between those two extremes, but it seem unlikely they would retire with the target amount as descried above.
Now putting on BH caricature hat, the above scenario morphs in to something like below.

- 4% is too aggressive; I can not go over 2.5%
- I want to double my standard of living; that is the whole reason I am retiring. I want to fly first class and take 12 Viking river cruises and have a condo in Aspen;
- I also wants to ignore SS and pension because I want to retire at age 55
- Because of the black swan events and unknown health care costs and long term care costs, I want 100% buffer

Taking all of the above in to account, my number is now $12.7M (actually, I have not calculated it yet but I am sure it will be closer to 8 figures than to 7 figures) Somebody wants to redo my calculations using the above scenario?

The really sad part is that there are some BH who do think just like that. Although one never knows if they are trolling us or are really sincere about their belief in that calculation.

smitcat
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Re: How much money do you want to retire?

Post by smitcat » Fri Sep 28, 2018 8:50 am

wrongfunds wrote:
Fri Sep 28, 2018 7:21 am
marcopolo wrote:
Thu Sep 27, 2018 9:42 pm
wrongfunds wrote:
Thu Sep 27, 2018 4:59 pm
Let us run some numbers for $100k+$100k professional couple. If they have been able to fully contribute to 401K, IRA, HSA etc then they have never even seen (approx) 24+24+11+7 = 66K of that paycheck. Add Medicare (7+7) and SS taxes (3K) to the money never saw column. That makes it $83K vanished from the yearly paycheck. That leaves the couple with $117K to pay all other taxes and household expenses and mortgage and tuition and after tax savings etc.

If this couple has been used to keep their heads above water; then they should in theory have no trouble being able to live very comfortably, might even lavishly, at $117K *if* they are done with mortgage and kids colleges. Actually that sounds like insane amount of money to me with no mortgage and no tuition bills to pay it from!

Being professional couple working for many years, we will estimate they will be able to get around $30K each at FRA. Now they need to be able to support (117-30-30) = $67K from their invest-able assets. With assumed 4%, the couple needs to have $1.67M of assets. Now that sounds like a big number but if they were fully funding their retirement account for many years in the past as I assumed before, this number should be reachable.

Here is my answer; We want $1.67M to retire :-)

Anybody wants to poke holes in the calculations?
wrongfunds wrote:
Thu Sep 27, 2018 7:28 pm
Oops, I am really red faced with that error! So that drops the required assets to $1.425M, under the psychological (and artificial) barrier of $1.5M.

I think the point not said behind the hypothetical scenario is that one needs to control the expenses and let the investment money come straight out from the paycheck which will allow continued life style in retirement.

I think the math makes a lot of sense in theory. I think in practice, it is very unlikely that one could/would retire with that level of assets given the scenario described. I thing the issue is one of timing.

Even if the hypothetical couple got a fairly late start at savings, let's say they are 40 when they start this plan, with no prior savings. With that level of savings, they would likely hit the target number somewhere in their mid-fifties. The problem at that point s that they would need a LOT more money to maintain their lifestyle because SS is still 10-15 years away, and they also need to think about health insurance for 10 years. Conversely, if they wait until medicare?=/SS FRA age and continue their savings, they will end up with a LOT more money, which they may not need. They may retire somewhere between those two extremes, but it seem unlikely they would retire with the target amount as descried above.
Now putting on BH caricature hat, the above scenario morphs in to something like below.

- 4% is too aggressive; I can not go over 2.5%
- I want to double my standard of living; that is the whole reason I am retiring. I want to fly first class and take 12 Viking river cruises and have a condo in Aspen;
- I also wants to ignore SS and pension because I want to retire at age 55
- Because of the black swan events and unknown health care costs and long term care costs, I want 100% buffer

Taking all of the above in to account, my number is now $12.7M (actually, I have not calculated it yet but I am sure it will be closer to 8 figures than to 7 figures) Somebody wants to redo my calculations using the above scenario?

The really sad part is that there are some BH who do think just like that. Although one never knows if they are trolling us or are really sincere about their belief in that calculation.
I cannot speak for anyone other than ourselves but this is how we view it....

- 4% is too aggressive; I can not go over 2.5%
A VPW seems appropriate with an average around 3.3%

- I want to double my standard of living; that is the whole reason I am retiring. I want to fly first class and take 12 Viking river cruises and have a condo in Aspen;
Our goals are to balance our standard of living both before and after full retirement.

- I also wants to ignore SS and pension because I want to retire at age 55
We run our plans/scenarios with both full SS and the potentially reduced future amounts.

- Because of the black swan events and unknown health care costs and long term care costs, I want 100% buffer
Our goal is to leave our heirs with a good amount, we may need that if there are black swans.

- The really sad part is that there are some BH who do think just like that.
Life is good both before and after retirement , we never were 'waiting' for retirment to live in some other fashion or experience some delayed segment of life.

wrongfunds
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Re: How much money do you want to retire?

Post by wrongfunds » Fri Sep 28, 2018 9:09 am

I did do those calculations and came up with $18.72M. That is what I need.

smitcat
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Re: How much money do you want to retire?

Post by smitcat » Fri Sep 28, 2018 9:13 am

wrongfunds wrote:
Fri Sep 28, 2018 9:09 am
I did do those calculations and came up with $18.72M. That is what I need.
So your 'real' number is $120K per year and $3 million.

AnonJohn
Posts: 266
Joined: Wed Oct 07, 2015 2:45 pm

Re: How much money do you want to retire?

Post by AnonJohn » Fri Sep 28, 2018 9:17 am

About $1M in 2014 dollars. $2 M would be ideal. But $1 M would be enough.

wrongfunds
Posts: 2193
Joined: Tue Dec 21, 2010 3:55 pm

Re: How much money do you want to retire?

Post by wrongfunds » Fri Sep 28, 2018 9:22 am

smitcat wrote:
Fri Sep 28, 2018 9:13 am
wrongfunds wrote:
Fri Sep 28, 2018 9:09 am
I did do those calculations and came up with $18.72M. That is what I need.
So your 'real' number is $120K per year and $3 million.
I started with the previously stated $117K annual spend. Doubled it to $234K because we want to live lavishly in retirement
At 2.5% that translates in to $9360M. To account for black swan and legacy etc, so doubling it gives $18.27M

How did you come up with only $3M?

wrongfunds
Posts: 2193
Joined: Tue Dec 21, 2010 3:55 pm

Re: How much money do you want to retire?

Post by wrongfunds » Fri Sep 28, 2018 9:23 am

AnonJohn wrote:
Fri Sep 28, 2018 9:17 am
About $1M in 2014 dollars. $2 M would be ideal. But $1 M would be enough.
What is so special about 2014 dollars? Is that a typo?

LiterallyIronic
Posts: 1353
Joined: Sat Dec 05, 2015 10:36 am

Re: How much money do you want to retire?

Post by LiterallyIronic » Fri Sep 28, 2018 9:32 am

Peppergrass wrote:
Fri Sep 28, 2018 12:50 am
HomerJ wrote:
Fri Sep 28, 2018 12:30 am
Peppergrass wrote:
Thu Sep 27, 2018 11:53 pm
I like setting high goals,, it pushes you farther, while if you don't hit it you most likely get pretty dang far
Is it possible there are other high goals in life that don't revolve around making or even spending money?
there are many.. and one could say they are more important then money, but what if you had them.. and MONEY ! that's an amazing life, not a great life but a super fulfilled crazy awesome life..

( friends, family, relationship, behavior, attitude, goals, sense of purpose, love, laughter, enjoyment, fulfillment, service to others, passion, spirituality, time, health, good habits, community, experiences... ... )


I don't know anyone given the choice would rather sit in the back fo the plane then fly up front, I don't know anyone given the choice would want to get a car because of price rather then because they want it... there are tons fo things money is great for.. never checking prices at the grocery store, going on a. trip and as long as you want for the experience doing it your way because you have the money..

I will totally be the first to admit a love of money more then most people, but I don't see it as a bad thing at all.. money provides me experiences I want to have and not forced to have.. that's not a bad thing ever.. if you chase money and you have your priorities in line, I see no problem with that.. heck people most likely waste more time watching tv and this and that then my quest to make more and more money.. we all do what we do down here, one of my drives is money and I will always be at the forefront to speak loudly.. there isn't one wrong thing with wanting money, only one thing is wanting money for money sake, I understand money provides you things and time and I use it accordingly

I believe anyone who says money "isn't that important" just hasen't seen how incredible a life can be with an abundance of.. of all things to be discussing this on a money related website should give us some clue.. .... if you have everything else "worthwhile" in life, why not add money to the list? what's the problem with that

secondly, money is being generated at an ever increasing speed then ever before.. no one in the past could ever become a billionaire overnight so quickly as one can today.. or at the speed people are hitting the billionaire list.. Heck we all know a million isn't special anymore even if you do have it.
First of all, your use of "then" instead of "than" is really bugging me.

Secondly, here I am. Gaining money does not provide you time. Gaining money takes away your time. You say you don't know anyone who would choose to sit in the back of the plane rather than the front? Here I am. If the seats are free, sure I'll sit in First Class. But they're not free. So I choose to sit in the back row, next to the toilet instead of spending my time to earn more money to spend on better seats. Same with the clunker. I can work a short period of time and buy a $1000 car or spend my time working more for a more expensive car. I'm taking the former every time.

Money provides me with one thing and one thing only: the ability to not work any more. Money isn't "great for a lot of things" it's great for one thing: not working. So I'm going to earn the bare minimum, retire as soon as possible, and hopefully bounce my last check.

You mention a bunch of other items in life: "friends, family, relationship, behavior, attitude, goals, sense of purpose, love, laughter, enjoyment, fulfillment, service to others, passion, spirituality, time, health, good habits, community, experiences, etc" and say, "why not have those and money?". To that, I say you can't. Every second you spend at work is a second you didn't spend with your friends, family, etc. Ergo, you didn't maximum those - you made a trade-off. You trade off that stuff for making money; other people, such as myself, trade off making money for that other stuff.

Thirdly, a million is absolutely special. If someone handed me a million dollars, I'd retire today at age 34.

smitcat
Posts: 4642
Joined: Mon Nov 07, 2016 10:51 am

Re: How much money do you want to retire?

Post by smitcat » Fri Sep 28, 2018 9:33 am

wrongfunds wrote:
Fri Sep 28, 2018 9:22 am
smitcat wrote:
Fri Sep 28, 2018 9:13 am
wrongfunds wrote:
Fri Sep 28, 2018 9:09 am
I did do those calculations and came up with $18.72M. That is what I need.
So your 'real' number is $120K per year and $3 million.
I started with the previously stated $117K annual spend. Doubled it to $234K because we want to live lavishly in retirement
At 2.5% that translates in to $9360M. To account for black swan and legacy etc, so doubling it gives $18.27M

How did you come up with only $3M?

"How did you come up with only $3M?"
Your new requirements in the above post....
1- 4% is too aggressive; I can not go over 2.5%
2- I want to double my standard of living; that is the whole reason I am retiring. I want to fly first class and take 12 Viking river cruises and have a condo in Aspen;
3- I also wants to ignore SS and pension because I want to retire at age 55
4- Because of the black swan events and unknown health care costs and long term care costs, I want 100% buffer

3 million was before the additional 'requirements' you put on.

3 million at 4% is $120/year without SS
$120 per year is base.
- add $50K/year for your stated cruises = $170
- mutiply by 2 for your 100% buffer = $340
- Need is X 50 for your 2.5% withdrawal rate = $17 million
- add 1.25 Million to cover part of a black swan = $18.25 million

smitcat
Posts: 4642
Joined: Mon Nov 07, 2016 10:51 am

Re: How much money do you want to retire?

Post by smitcat » Fri Sep 28, 2018 9:37 am

LiterallyIronic wrote:
Fri Sep 28, 2018 9:32 am
Peppergrass wrote:
Fri Sep 28, 2018 12:50 am
HomerJ wrote:
Fri Sep 28, 2018 12:30 am
Peppergrass wrote:
Thu Sep 27, 2018 11:53 pm
I like setting high goals,, it pushes you farther, while if you don't hit it you most likely get pretty dang far
Is it possible there are other high goals in life that don't revolve around making or even spending money?
there are many.. and one could say they are more important then money, but what if you had them.. and MONEY ! that's an amazing life, not a great life but a super fulfilled crazy awesome life..

( friends, family, relationship, behavior, attitude, goals, sense of purpose, love, laughter, enjoyment, fulfillment, service to others, passion, spirituality, time, health, good habits, community, experiences... ... )


I don't know anyone given the choice would rather sit in the back fo the plane then fly up front, I don't know anyone given the choice would want to get a car because of price rather then because they want it... there are tons fo things money is great for.. never checking prices at the grocery store, going on a. trip and as long as you want for the experience doing it your way because you have the money..

I will totally be the first to admit a love of money more then most people, but I don't see it as a bad thing at all.. money provides me experiences I want to have and not forced to have.. that's not a bad thing ever.. if you chase money and you have your priorities in line, I see no problem with that.. heck people most likely waste more time watching tv and this and that then my quest to make more and more money.. we all do what we do down here, one of my drives is money and I will always be at the forefront to speak loudly.. there isn't one wrong thing with wanting money, only one thing is wanting money for money sake, I understand money provides you things and time and I use it accordingly

I believe anyone who says money "isn't that important" just hasen't seen how incredible a life can be with an abundance of.. of all things to be discussing this on a money related website should give us some clue.. .... if you have everything else "worthwhile" in life, why not add money to the list? what's the problem with that

secondly, money is being generated at an ever increasing speed then ever before.. no one in the past could ever become a billionaire overnight so quickly as one can today.. or at the speed people are hitting the billionaire list.. Heck we all know a million isn't special anymore even if you do have it.
First of all, your use of "then" instead of "than" is really bugging me.

Secondly, here I am. Gaining money does not provide you time. Gaining money takes away your time. You say you don't know anyone who would choose to sit in the back of the plane rather than the front? Here I am. If the seats are free, sure I'll sit in First Class. But they're not free. So I choose to sit in the back row, next to the toilet instead of spending my time to earn more money to spend on better seats. Same with the clunker. I can work a short period of time and buy a $1000 car or spend my time working more for a more expensive car. I'm taking the former every time.

Money provides me with one thing and one thing only: the ability to not work any more. Money isn't "great for a lot of things" it's great for one thing: not working. So I'm going to earn the bare minimum, retire as soon as possible, and hopefully bounce my last check.

You mention a bunch of other items in life: "friends, family, relationship, behavior, attitude, goals, sense of purpose, love, laughter, enjoyment, fulfillment, service to others, passion, spirituality, time, health, good habits, community, experiences, etc" and say, "why not have those and money?". To that, I say you can't. Every second you spend at work is a second you didn't spend with your friends, family, etc. Ergo, you didn't maximum those - you made a trade-off. You trade off that stuff for making money; other people, such as myself, trade off making money for that other stuff.

Thirdly, a million is absolutely special. If someone handed me a million dollars, I'd retire today at age 34.
"Every second you spend at work is a second you didn't spend with your friends, family, etc. Ergo, you didn't maximum those - you made a trade-off. You trade off that stuff for making money; other people, such as myself, trade off making money for that other stuff."

This is a secular and hourly view - its really not the way it works for many folks. Your retirement goal of a very small expense footprint and small activity plan is not shared by all either.

bluelight
Posts: 312
Joined: Sun Jul 10, 2011 12:08 am

Re: How much money do you want to retire?

Post by bluelight » Fri Sep 28, 2018 9:43 am

wrongfunds wrote:
Thu Sep 27, 2018 9:55 pm
bluelight wrote:
Thu Sep 27, 2018 9:44 pm
I'm 3 months shy of 62, DH is 72 and has been retired for a number of years. I'd like to have 3M in retirement, we are about 60K short of that excluding our 550K house (no mortgage).

Our retirement income (pensions, SS and dividends) should come close to covering our retirement expenses within 10-20K per year.

I waffle between I'm done with work, I should work another 6 months, I should work another year.
I do not get you at all! In the scheme of the thing, that 60K is really rounding off error. If your retirement expense are near 200K (I came up with this number because of 4% of 3M + SS +SS + pension). then surely that 60K is drop in the bucket. It is literally 2% of your portfolio and your portfolio fluctuate by that much every single week.
Is it 2%? I never really checked, but is sounds about right.

Retirement expenses should be about 120K, income about the same. We live fairly frugally in a HCOL area.

Hubby is afraid that we will run out of money when I retire. I'm a little nervous about medical. I would have 1 1/2 years between the end of Cobra and the start of Medicare. My goal is spring 2019 to retire.

Crisium
Posts: 201
Joined: Thu Dec 22, 2016 9:52 am

Re: How much money do you want to retire?

Post by Crisium » Fri Sep 28, 2018 9:48 am

LiterallyIronic wrote:
Fri Sep 28, 2018 9:32 am
Thirdly, a million is absolutely special. If someone handed me a million dollars, I'd retire today at age 34.
Sometimes the life style inflation here is jarring to us more MMM types. $1M is still special, and living with a $40k income ($1M 4% SWR) still provides a better life than emperors ever had (unless your only quality of life measure is square footage).

LiterallyIronic
Posts: 1353
Joined: Sat Dec 05, 2015 10:36 am

Re: How much money do you want to retire?

Post by LiterallyIronic » Fri Sep 28, 2018 9:50 am

smitcat wrote:
Fri Sep 28, 2018 9:37 am
LiterallyIronic wrote:
Fri Sep 28, 2018 9:32 am
Peppergrass wrote:
Fri Sep 28, 2018 12:50 am
HomerJ wrote:
Fri Sep 28, 2018 12:30 am
Peppergrass wrote:
Thu Sep 27, 2018 11:53 pm
I like setting high goals,, it pushes you farther, while if you don't hit it you most likely get pretty dang far
Is it possible there are other high goals in life that don't revolve around making or even spending money?
there are many.. and one could say they are more important then money, but what if you had them.. and MONEY ! that's an amazing life, not a great life but a super fulfilled crazy awesome life..

( friends, family, relationship, behavior, attitude, goals, sense of purpose, love, laughter, enjoyment, fulfillment, service to others, passion, spirituality, time, health, good habits, community, experiences... ... )


I don't know anyone given the choice would rather sit in the back fo the plane then fly up front, I don't know anyone given the choice would want to get a car because of price rather then because they want it... there are tons fo things money is great for.. never checking prices at the grocery store, going on a. trip and as long as you want for the experience doing it your way because you have the money..

I will totally be the first to admit a love of money more then most people, but I don't see it as a bad thing at all.. money provides me experiences I want to have and not forced to have.. that's not a bad thing ever.. if you chase money and you have your priorities in line, I see no problem with that.. heck people most likely waste more time watching tv and this and that then my quest to make more and more money.. we all do what we do down here, one of my drives is money and I will always be at the forefront to speak loudly.. there isn't one wrong thing with wanting money, only one thing is wanting money for money sake, I understand money provides you things and time and I use it accordingly

I believe anyone who says money "isn't that important" just hasen't seen how incredible a life can be with an abundance of.. of all things to be discussing this on a money related website should give us some clue.. .... if you have everything else "worthwhile" in life, why not add money to the list? what's the problem with that

secondly, money is being generated at an ever increasing speed then ever before.. no one in the past could ever become a billionaire overnight so quickly as one can today.. or at the speed people are hitting the billionaire list.. Heck we all know a million isn't special anymore even if you do have it.
First of all, your use of "then" instead of "than" is really bugging me.

Secondly, here I am. Gaining money does not provide you time. Gaining money takes away your time. You say you don't know anyone who would choose to sit in the back of the plane rather than the front? Here I am. If the seats are free, sure I'll sit in First Class. But they're not free. So I choose to sit in the back row, next to the toilet instead of spending my time to earn more money to spend on better seats. Same with the clunker. I can work a short period of time and buy a $1000 car or spend my time working more for a more expensive car. I'm taking the former every time.

Money provides me with one thing and one thing only: the ability to not work any more. Money isn't "great for a lot of things" it's great for one thing: not working. So I'm going to earn the bare minimum, retire as soon as possible, and hopefully bounce my last check.

You mention a bunch of other items in life: "friends, family, relationship, behavior, attitude, goals, sense of purpose, love, laughter, enjoyment, fulfillment, service to others, passion, spirituality, time, health, good habits, community, experiences, etc" and say, "why not have those and money?". To that, I say you can't. Every second you spend at work is a second you didn't spend with your friends, family, etc. Ergo, you didn't maximum those - you made a trade-off. You trade off that stuff for making money; other people, such as myself, trade off making money for that other stuff.

Thirdly, a million is absolutely special. If someone handed me a million dollars, I'd retire today at age 34.
"Every second you spend at work is a second you didn't spend with your friends, family, etc. Ergo, you didn't maximum those - you made a trade-off. You trade off that stuff for making money; other people, such as myself, trade off making money for that other stuff."

This is a secular and hourly view - its really not the way it works for many folks. Your retirement goal of a very small expense footprint and small activity plan is not shared by all either.
Well, yeah, obviously not everyone shares the goal of small expenses and little activity. That's the point I'm making. Some people want to work longer, earn more money, and spend more money. Others want the opposite. And it's a huge spectrum of people making different trade-offs for different things. And that was my point.

As for your comment about "This is a secular and hourly view - its really not the way it works for many folks", I don't know what that sentence is supposed to mean. Doesn't "secular" mean "not religious"?

smitcat
Posts: 4642
Joined: Mon Nov 07, 2016 10:51 am

Re: How much money do you want to retire?

Post by smitcat » Fri Sep 28, 2018 9:53 am

bluelight wrote:
Fri Sep 28, 2018 9:43 am
wrongfunds wrote:
Thu Sep 27, 2018 9:55 pm
bluelight wrote:
Thu Sep 27, 2018 9:44 pm
I'm 3 months shy of 62, DH is 72 and has been retired for a number of years. I'd like to have 3M in retirement, we are about 60K short of that excluding our 550K house (no mortgage).

Our retirement income (pensions, SS and dividends) should come close to covering our retirement expenses within 10-20K per year.

I waffle between I'm done with work, I should work another 6 months, I should work another year.
I do not get you at all! In the scheme of the thing, that 60K is really rounding off error. If your retirement expense are near 200K (I came up with this number because of 4% of 3M + SS +SS + pension). then surely that 60K is drop in the bucket. It is literally 2% of your portfolio and your portfolio fluctuate by that much every single week.
Is it 2%? I never really checked, but is sounds about right.

Retirement expenses should be about 120K, income about the same. We live fairly frugally in a HCOL area.

Hubby is afraid that we will run out of money when I retire. I'm a little nervous about medical. I would have 1 1/2 years between the end of Cobra and the start of Medicare. My goal is spring 2019 to retire.

Your should be more then fine - have you run your numbers on a few retirement calculators to help relive your anxiety with your plans?
You are really in good shape.

bluelight
Posts: 312
Joined: Sun Jul 10, 2011 12:08 am

Re: How much money do you want to retire?

Post by bluelight » Fri Sep 28, 2018 9:56 am

randomguy wrote:
Fri Sep 28, 2018 1:22 am
HomerJ wrote:
Thu Sep 27, 2018 11:59 pm
bluelight wrote:
Thu Sep 27, 2018 9:44 pm
I'm 3 months shy of 62, DH is 72 and has been retired for a number of years. I'd like to have 3M in retirement, we are about 60K short of that excluding our 550K house (no mortgage).

Our retirement income (pensions, SS and dividends) should come close to covering our retirement expenses within 10-20K per year.

I waffle between I'm done with work, I should work another 6 months, I should work another year.
Why? Seriously, why?
Hubby has a 150k/year pension that goes away when he dies? Thats about all I can come up with.

There is also a big fear of change thing for most people. If live is going good, why rock the boat?
Our pensions and SS are about the same, mine may actually be a little more. His does go away when he dies.

We live pretty frugally, far below our means. Yet we have an Alaska cruise in the works for next year and a Viking cruise though France for 2020. I'd like to have them both paid for before retirement, and some things I'd like to have finished on the house.
If live is going good, why rock the boat?

As much as I want to retire, this may actually be the biggest reason.

wrongfunds
Posts: 2193
Joined: Tue Dec 21, 2010 3:55 pm

Re: How much money do you want to retire?

Post by wrongfunds » Fri Sep 28, 2018 9:59 am

bluelight wrote:
Fri Sep 28, 2018 9:43 am
wrongfunds wrote:
Thu Sep 27, 2018 9:55 pm
bluelight wrote:
Thu Sep 27, 2018 9:44 pm
I'm 3 months shy of 62, DH is 72 and has been retired for a number of years. I'd like to have 3M in retirement, we are about 60K short of that excluding our 550K house (no mortgage).

Our retirement income (pensions, SS and dividends) should come close to covering our retirement expenses within 10-20K per year.

I waffle between I'm done with work, I should work another 6 months, I should work another year.
I do not get you at all! In the scheme of the thing, that 60K is really rounding off error. If your retirement expense are near 200K (I came up with this number because of 4% of 3M + SS +SS + pension). then surely that 60K is drop in the bucket. It is literally 2% of your portfolio and your portfolio fluctuate by that much every single week.
Is it 2%? I never really checked, but is sounds about right.

Retirement expenses should be about 120K, income about the same. We live fairly frugally in a HCOL area.

Hubby is afraid that we will run out of money when I retire. I'm a little nervous about medical. I would have 1 1/2 years between the end of Cobra and the start of Medicare. My goal is spring 2019 to retire.
I think both of you need to visit some impartial third party who will assure you otherwise. With your assets, there would be lot of interest for them to give you "free consultation". You just have to be little bit resistant when they try to push you towards their high cost products.

If you are working because either of you fear "running out of money", then it can be mathematically proven that you have totally irrational fear.

bluelight
Posts: 312
Joined: Sun Jul 10, 2011 12:08 am

Re: How much money do you want to retire?

Post by bluelight » Fri Sep 28, 2018 10:00 am

smitcat wrote:
Fri Sep 28, 2018 9:53 am
bluelight wrote:
Fri Sep 28, 2018 9:43 am
wrongfunds wrote:
Thu Sep 27, 2018 9:55 pm
bluelight wrote:
Thu Sep 27, 2018 9:44 pm
I'm 3 months shy of 62, DH is 72 and has been retired for a number of years. I'd like to have 3M in retirement, we are about 60K short of that excluding our 550K house (no mortgage).

Our retirement income (pensions, SS and dividends) should come close to covering our retirement expenses within 10-20K per year.

I waffle between I'm done with work, I should work another 6 months, I should work another year.
I do not get you at all! In the scheme of the thing, that 60K is really rounding off error. If your retirement expense are near 200K (I came up with this number because of 4% of 3M + SS +SS + pension). then surely that 60K is drop in the bucket. It is literally 2% of your portfolio and your portfolio fluctuate by that much every single week.
Is it 2%? I never really checked, but is sounds about right.

Retirement expenses should be about 120K, income about the same. We live fairly frugally in a HCOL area.

Hubby is afraid that we will run out of money when I retire. I'm a little nervous about medical. I would have 1 1/2 years between the end of Cobra and the start of Medicare. My goal is spring 2019 to retire.

Your should be more then fine - have you run your numbers on a few retirement calculators to help relive your anxiety with your plans?
You are really in good shape.
Yes, I've tracked our expenses for the last 5 years and have run our numbers on Firecalc. I try to show my husband, but he would just rather worry that we will run out of money.

smitcat
Posts: 4642
Joined: Mon Nov 07, 2016 10:51 am

Re: How much money do you want to retire?

Post by smitcat » Fri Sep 28, 2018 10:02 am

LiterallyIronic wrote:
Fri Sep 28, 2018 9:50 am
smitcat wrote:
Fri Sep 28, 2018 9:37 am
LiterallyIronic wrote:
Fri Sep 28, 2018 9:32 am
Peppergrass wrote:
Fri Sep 28, 2018 12:50 am
HomerJ wrote:
Fri Sep 28, 2018 12:30 am


Is it possible there are other high goals in life that don't revolve around making or even spending money?
there are many.. and one could say they are more important then money, but what if you had them.. and MONEY ! that's an amazing life, not a great life but a super fulfilled crazy awesome life..

( friends, family, relationship, behavior, attitude, goals, sense of purpose, love, laughter, enjoyment, fulfillment, service to others, passion, spirituality, time, health, good habits, community, experiences... ... )


I don't know anyone given the choice would rather sit in the back fo the plane then fly up front, I don't know anyone given the choice would want to get a car because of price rather then because they want it... there are tons fo things money is great for.. never checking prices at the grocery store, going on a. trip and as long as you want for the experience doing it your way because you have the money..

I will totally be the first to admit a love of money more then most people, but I don't see it as a bad thing at all.. money provides me experiences I want to have and not forced to have.. that's not a bad thing ever.. if you chase money and you have your priorities in line, I see no problem with that.. heck people most likely waste more time watching tv and this and that then my quest to make more and more money.. we all do what we do down here, one of my drives is money and I will always be at the forefront to speak loudly.. there isn't one wrong thing with wanting money, only one thing is wanting money for money sake, I understand money provides you things and time and I use it accordingly

I believe anyone who says money "isn't that important" just hasen't seen how incredible a life can be with an abundance of.. of all things to be discussing this on a money related website should give us some clue.. .... if you have everything else "worthwhile" in life, why not add money to the list? what's the problem with that

secondly, money is being generated at an ever increasing speed then ever before.. no one in the past could ever become a billionaire overnight so quickly as one can today.. or at the speed people are hitting the billionaire list.. Heck we all know a million isn't special anymore even if you do have it.
First of all, your use of "then" instead of "than" is really bugging me.

Secondly, here I am. Gaining money does not provide you time. Gaining money takes away your time. You say you don't know anyone who would choose to sit in the back of the plane rather than the front? Here I am. If the seats are free, sure I'll sit in First Class. But they're not free. So I choose to sit in the back row, next to the toilet instead of spending my time to earn more money to spend on better seats. Same with the clunker. I can work a short period of time and buy a $1000 car or spend my time working more for a more expensive car. I'm taking the former every time.

Money provides me with one thing and one thing only: the ability to not work any more. Money isn't "great for a lot of things" it's great for one thing: not working. So I'm going to earn the bare minimum, retire as soon as possible, and hopefully bounce my last check.

You mention a bunch of other items in life: "friends, family, relationship, behavior, attitude, goals, sense of purpose, love, laughter, enjoyment, fulfillment, service to others, passion, spirituality, time, health, good habits, community, experiences, etc" and say, "why not have those and money?". To that, I say you can't. Every second you spend at work is a second you didn't spend with your friends, family, etc. Ergo, you didn't maximum those - you made a trade-off. You trade off that stuff for making money; other people, such as myself, trade off making money for that other stuff.

Thirdly, a million is absolutely special. If someone handed me a million dollars, I'd retire today at age 34.
"Every second you spend at work is a second you didn't spend with your friends, family, etc. Ergo, you didn't maximum those - you made a trade-off. You trade off that stuff for making money; other people, such as myself, trade off making money for that other stuff."

This is a secular and hourly view - its really not the way it works for many folks. Your retirement goal of a very small expense footprint and small activity plan is not shared by all either.
Well, yeah, obviously not everyone shares the goal of small expenses and little activity. That's the point I'm making. Some people want to work longer, earn more money, and spend more money. Others want the opposite. And it's a huge spectrum of people making different trade-offs for different things. And that was my point.

As for your comment about "This is a secular and hourly view - its really not the way it works for many folks", I don't know what that sentence is supposed to mean. Doesn't "secular" mean "not religious"?
I hope I am wrong but this is what your posts seem to indicate....
Your view is that work is terrible, work is something to be avoided, and that work is equal to money earned. Work is a unit of pain that is tolerated but generates one unit of money for each hour of pain. Work takes you away from the people you like and has no enjoyment, no fulfilling times, no learning experiences nor great adventures. There is no light at the end of the work tunnel as there is no improvement or advancement worth the efforts.
The goal appears to be to tolerate work untill/unless you can repalace it with doing as little as possible.
Again - I hope this is incorrect ....

smitcat
Posts: 4642
Joined: Mon Nov 07, 2016 10:51 am

Re: How much money do you want to retire?

Post by smitcat » Fri Sep 28, 2018 10:06 am

bluelight wrote:
Fri Sep 28, 2018 10:00 am
smitcat wrote:
Fri Sep 28, 2018 9:53 am
bluelight wrote:
Fri Sep 28, 2018 9:43 am
wrongfunds wrote:
Thu Sep 27, 2018 9:55 pm
bluelight wrote:
Thu Sep 27, 2018 9:44 pm
I'm 3 months shy of 62, DH is 72 and has been retired for a number of years. I'd like to have 3M in retirement, we are about 60K short of that excluding our 550K house (no mortgage).

Our retirement income (pensions, SS and dividends) should come close to covering our retirement expenses within 10-20K per year.

I waffle between I'm done with work, I should work another 6 months, I should work another year.
I do not get you at all! In the scheme of the thing, that 60K is really rounding off error. If your retirement expense are near 200K (I came up with this number because of 4% of 3M + SS +SS + pension). then surely that 60K is drop in the bucket. It is literally 2% of your portfolio and your portfolio fluctuate by that much every single week.
Is it 2%? I never really checked, but is sounds about right.

Retirement expenses should be about 120K, income about the same. We live fairly frugally in a HCOL area.

Hubby is afraid that we will run out of money when I retire. I'm a little nervous about medical. I would have 1 1/2 years between the end of Cobra and the start of Medicare. My goal is spring 2019 to retire.

Your should be more then fine - have you run your numbers on a few retirement calculators to help relive your anxiety with your plans?
You are really in good shape.
Yes, I've tracked our expenses for the last 5 years and have run our numbers on Firecalc. I try to show my husband, but he would just rather worry that we will run out of money.
Perhaps run it on the extended IORP , or for more detail on the RPM spreadsheet calculator and play with things like Roth conversions and tax implications. Worrying is really not a good alternative....running the RPM may show you that waiting is not as much of an issue for 'spendable' money then you think. As you wait to implement your retirement for savings to grow you may also be closing some doors on Roth conversions and the net result will likely be unexpected for your situation.

FoolMeOnce
Posts: 760
Joined: Mon Apr 24, 2017 11:16 am

Re: How much money do you want to retire?

Post by FoolMeOnce » Fri Sep 28, 2018 10:17 am

wrongfunds wrote:
Fri Sep 28, 2018 7:21 am
marcopolo wrote:
Thu Sep 27, 2018 9:42 pm
wrongfunds wrote:
Thu Sep 27, 2018 4:59 pm
Let us run some numbers for $100k+$100k professional couple. If they have been able to fully contribute to 401K, IRA, HSA etc then they have never even seen (approx) 24+24+11+7 = 66K of that paycheck. Add Medicare (7+7) and SS taxes (3K) to the money never saw column. That makes it $83K vanished from the yearly paycheck. That leaves the couple with $117K to pay all other taxes and household expenses and mortgage and tuition and after tax savings etc.

If this couple has been used to keep their heads above water; then they should in theory have no trouble being able to live very comfortably, might even lavishly, at $117K *if* they are done with mortgage and kids colleges. Actually that sounds like insane amount of money to me with no mortgage and no tuition bills to pay it from!

Being professional couple working for many years, we will estimate they will be able to get around $30K each at FRA. Now they need to be able to support (117-30-30) = $67K from their invest-able assets. With assumed 4%, the couple needs to have $1.67M of assets. Now that sounds like a big number but if they were fully funding their retirement account for many years in the past as I assumed before, this number should be reachable.

Here is my answer; We want $1.67M to retire :-)

Anybody wants to poke holes in the calculations?
wrongfunds wrote:
Thu Sep 27, 2018 7:28 pm
Oops, I am really red faced with that error! So that drops the required assets to $1.425M, under the psychological (and artificial) barrier of $1.5M.

I think the point not said behind the hypothetical scenario is that one needs to control the expenses and let the investment money come straight out from the paycheck which will allow continued life style in retirement.

I think the math makes a lot of sense in theory. I think in practice, it is very unlikely that one could/would retire with that level of assets given the scenario described. I thing the issue is one of timing.

Even if the hypothetical couple got a fairly late start at savings, let's say they are 40 when they start this plan, with no prior savings. With that level of savings, they would likely hit the target number somewhere in their mid-fifties. The problem at that point s that they would need a LOT more money to maintain their lifestyle because SS is still 10-15 years away, and they also need to think about health insurance for 10 years. Conversely, if they wait until medicare?=/SS FRA age and continue their savings, they will end up with a LOT more money, which they may not need. They may retire somewhere between those two extremes, but it seem unlikely they would retire with the target amount as descried above.
Now putting on BH caricature hat, the above scenario morphs in to something like below.

- 4% is too aggressive; I can not go over 2.5%
- I want to double my standard of living; that is the whole reason I am retiring. I want to fly first class and take 12 Viking river cruises and have a condo in Aspen;
- I also wants to ignore SS and pension because I want to retire at age 55
- Because of the black swan events and unknown health care costs and long term care costs, I want 100% buffer

Taking all of the above in to account, my number is now $12.7M (actually, I have not calculated it yet but I am sure it will be closer to 8 figures than to 7 figures) Somebody wants to redo my calculations using the above scenario?

The really sad part is that there are some BH who do think just like that. Although one never knows if they are trolling us or are really sincere about their belief in that calculation.
I like your original analysis, and I agree with the general point that many here are extremely and overly conservative, but you asked for anyone to poke holes in your calculations and when presented with a very reasonable one (your calculation includes SS from day one, but many if not most people here plan to retire years before taking SS), you turned it into a straw man. It is a serious, common, and not overly conservative critique. Perhaps you plan to take SS from day one, but the scenario you presented was for a generic "professional couple."

bluelight
Posts: 312
Joined: Sun Jul 10, 2011 12:08 am

Re: How much money do you want to retire?

Post by bluelight » Fri Sep 28, 2018 10:26 am

smitcat wrote:
Fri Sep 28, 2018 10:06 am
bluelight wrote:
Fri Sep 28, 2018 10:00 am
smitcat wrote:
Fri Sep 28, 2018 9:53 am
bluelight wrote:
Fri Sep 28, 2018 9:43 am
wrongfunds wrote:
Thu Sep 27, 2018 9:55 pm


I do not get you at all! In the scheme of the thing, that 60K is really rounding off error. If your retirement expense are near 200K (I came up with this number because of 4% of 3M + SS +SS + pension). then surely that 60K is drop in the bucket. It is literally 2% of your portfolio and your portfolio fluctuate by that much every single week.
Is it 2%? I never really checked, but is sounds about right.

Retirement expenses should be about 120K, income about the same. We live fairly frugally in a HCOL area.

Hubby is afraid that we will run out of money when I retire. I'm a little nervous about medical. I would have 1 1/2 years between the end of Cobra and the start of Medicare. My goal is spring 2019 to retire.

Your should be more then fine - have you run your numbers on a few retirement calculators to help relive your anxiety with your plans?
You are really in good shape.
Yes, I've tracked our expenses for the last 5 years and have run our numbers on Firecalc. I try to show my husband, but he would just rather worry that we will run out of money.
Perhaps run it on the extended IORP , or for more detail on the RPM spreadsheet calculator and play with things like Roth conversions and tax implications. Worrying is really not a good alternative....running the RPM may show you that waiting is not as much of an issue for 'spendable' money then you think. As you wait to implement your retirement for savings to grow you may also be closing some doors on Roth conversions and the net result will likely be unexpected for your situation.
Thank you. I'll take a look at the RPM spreadsheet. What is the extended IORP?

I know that I need to take a closer look at Roth conversions and also figure out the correct withdrawal order prior to retiring. I have seen info on BH, I just need to take the time to read it.

User avatar
HomerJ
Posts: 13584
Joined: Fri Jun 06, 2008 12:50 pm

Re: How much money do you want to retire?

Post by HomerJ » Fri Sep 28, 2018 10:27 am

bluelight...

Do the math.

If you can't retire, no one can.

You have $2.9 million, spend about $120,000 a year, and you have pensions and SS worth around $100k a year.

Put $400,000 in a emergency fund

Put $1 million in 3% CDs, and it will generate $30,000 a year. The principal won't even go down. You'll just be spending the interest. You'll still have the million in the bank the entire time.

The other $1.5 million, you can put 50/50 stocks/bonds. Just the dividends alone will generate at least $30,000 a year. Again, you won't even have to touch the principal, and it will grow over time.

There's no possible way for you guys to run out of money. Even when one of you dies, the interest alone on all that money will generate the extra $60k the survivor needs.

You don't even need to dip into the actual money you saved, like most of us (That's the point of saving it). You've gone so far beyond what you need, that you can live off just the interest from just a FRACTION of your portfolio, and the rest of your portfolio will just continue to grow.

(And this doesn't even include the $550k you have in your house).

Retire tomorrow. You have 0-30 years left on this planet. Note the ZERO. Don't waste it working if you don't want to.
The J stands for Jay

smitcat
Posts: 4642
Joined: Mon Nov 07, 2016 10:51 am

Re: How much money do you want to retire?

Post by smitcat » Fri Sep 28, 2018 10:44 am

bluelight wrote:
Fri Sep 28, 2018 10:26 am
smitcat wrote:
Fri Sep 28, 2018 10:06 am
bluelight wrote:
Fri Sep 28, 2018 10:00 am
smitcat wrote:
Fri Sep 28, 2018 9:53 am
bluelight wrote:
Fri Sep 28, 2018 9:43 am


Is it 2%? I never really checked, but is sounds about right.

Retirement expenses should be about 120K, income about the same. We live fairly frugally in a HCOL area.

Hubby is afraid that we will run out of money when I retire. I'm a little nervous about medical. I would have 1 1/2 years between the end of Cobra and the start of Medicare. My goal is spring 2019 to retire.

Your should be more then fine - have you run your numbers on a few retirement calculators to help relive your anxiety with your plans?
You are really in good shape.
Yes, I've tracked our expenses for the last 5 years and have run our numbers on Firecalc. I try to show my husband, but he would just rather worry that we will run out of money.
Perhaps run it on the extended IORP , or for more detail on the RPM spreadsheet calculator and play with things like Roth conversions and tax implications. Worrying is really not a good alternative....running the RPM may show you that waiting is not as much of an issue for 'spendable' money then you think. As you wait to implement your retirement for savings to grow you may also be closing some doors on Roth conversions and the net result will likely be unexpected for your situation.
Thank you. I'll take a look at the RPM spreadsheet. What is the extended IORP?

I know that I need to take a closer look at Roth conversions and also figure out the correct withdrawal order prior to retiring. I have seen info on BH, I just need to take the time to read it.
Extended IORP + https://www.i-orp.com/LumpSum/extended.html
Much easier to load and use the RPM allowing you to compare inputs quickly.
The RPM will take a bunch more time so perhaps only load that and play when you have a couple of your most likely scenarios.
The RPM will allow more details as well as an easy to compare chart for Roth and no Roth conversions.
It will take time but time making your plans and knowing you will be fine is well spent vs worrying.

smitcat
Posts: 4642
Joined: Mon Nov 07, 2016 10:51 am

Re: How much money do you want to retire?

Post by smitcat » Fri Sep 28, 2018 10:45 am

HomerJ wrote:
Fri Sep 28, 2018 10:27 am
bluelight...

Do the math.

If you can't retire, no one can.

You have $2.9 million, spend about $120,000 a year, and you have pensions and SS worth around $100k a year.

Put $400,000 in a emergency fund

Put $1 million in 3% CDs, and it will generate $30,000 a year. The principal won't even go down. You'll just be spending the interest. You'll still have the million in the bank the entire time.

The other $1.5 million, you can put 50/50 stocks/bonds. Just the dividends alone will generate at least $30,000 a year. Again, you won't even have to touch the principal, and it will grow over time.

There's no possible way for you guys to run out of money. Even when one of you dies, the interest alone on all that money will generate the extra $60k the survivor needs.

You don't even need to dip into the actual money you saved, like most of us (That's the point of saving it). You've gone so far beyond what you need, that you can live off just the interest from just a FRACTION of your portfolio, and the rest of your portfolio will just continue to grow.

(And this doesn't even include the $550k you have in your house).

Retire tomorrow. You have 0-30 years left on this planet. Note the ZERO. Don't waste it working if you don't want to.

Jay is very right !!!

wrongfunds
Posts: 2193
Joined: Tue Dec 21, 2010 3:55 pm

Re: How much money do you want to retire?

Post by wrongfunds » Fri Sep 28, 2018 10:49 am

FoolMeOnce wrote:
Fri Sep 28, 2018 10:17 am
...
...
I like your original analysis, and I agree with the general point that many here are extremely and overly conservative, but you asked for anyone to poke holes in your calculations and when presented with a very reasonable one (your calculation includes SS from day one, but many if not most people here plan to retire years before taking SS), you turned it into a straw man. It is a serious, common, and not overly conservative critique. Perhaps you plan to take SS from day one, but the scenario you presented was for a generic "professional couple."
So let us get serious again then. Suppose the couple wants to retire 5 years before collecting the SS/pension. So in that hypothetical case, they should have to allocate the missing $60K for 5 years. They will need additional $300K. Now we are at $1.8M.

But what if the couple still paying the mortgage and still has college bills to pay? In my humble opinion, that couple is NOT yet ready to retire but some do want to. If so, the original analysis does not apply to them.

The troubling part of this type of analysis is that some people want to put the "conservative hat" on every single aspect and then we get those astronomical numbers aka "straw man".

FoolMeOnce
Posts: 760
Joined: Mon Apr 24, 2017 11:16 am

Re: How much money do you want to retire?

Post by FoolMeOnce » Fri Sep 28, 2018 11:20 am

wrongfunds wrote:
Fri Sep 28, 2018 10:49 am
FoolMeOnce wrote:
Fri Sep 28, 2018 10:17 am
...
...
I like your original analysis, and I agree with the general point that many here are extremely and overly conservative, but you asked for anyone to poke holes in your calculations and when presented with a very reasonable one (your calculation includes SS from day one, but many if not most people here plan to retire years before taking SS), you turned it into a straw man. It is a serious, common, and not overly conservative critique. Perhaps you plan to take SS from day one, but the scenario you presented was for a generic "professional couple."
So let us get serious again then. Suppose the couple wants to retire 5 years before collecting the SS/pension. So in that hypothetical case, they should have to allocate the missing $60K for 5 years. They will need additional $300K. Now we are at $1.8M.

But what if the couple still paying the mortgage and still has college bills to pay? In my humble opinion, that couple is NOT yet ready to retire but some do want to. If so, the original analysis does not apply to them.

The troubling part of this type of analysis is that some people want to put the "conservative hat" on every single aspect and then we get those astronomical numbers aka "straw man".
I think the mortgage was already included in your initial calculations - an expense already covered by the money available for expenses during the working years, and the calculation for retirement expenses based off that number. As for accounting for years before SS, I don't see anything conservative about that. Ignoring SS altogether, as many do, is one thing; accounting for the known years without it is another.

LiterallyIronic
Posts: 1353
Joined: Sat Dec 05, 2015 10:36 am

Re: How much money do you want to retire?

Post by LiterallyIronic » Fri Sep 28, 2018 1:10 pm

smitcat wrote:
Fri Sep 28, 2018 10:02 am
I hope I am wrong but this is what your posts seem to indicate....
Your view is that work is terrible, work is something to be avoided, and that work is equal to money earned. Work is a unit of pain that is tolerated but generates one unit of money for each hour of pain. Work takes you away from the people you like and has no enjoyment, no fulfilling times, no learning experiences nor great adventures. There is no light at the end of the work tunnel as there is no improvement or advancement worth the efforts.
The goal appears to be to tolerate work untill/unless you can repalace it with doing as little as possible.
Again - I hope this is incorrect ....
No, you have correctly interpreted my view of work and you phrased it beautifully.

bluelight
Posts: 312
Joined: Sun Jul 10, 2011 12:08 am

Re: How much money do you want to retire?

Post by bluelight » Fri Sep 28, 2018 1:57 pm

HomerJ wrote:
Fri Sep 28, 2018 10:27 am
bluelight...

Do the math.

If you can't retire, no one can.

You have $2.9 million, spend about $120,000 a year, and you have pensions and SS worth around $100k a year.

Put $400,000 in a emergency fund

Put $1 million in 3% CDs, and it will generate $30,000 a year. The principal won't even go down. You'll just be spending the interest. You'll still have the million in the bank the entire time.

The other $1.5 million, you can put 50/50 stocks/bonds. Just the dividends alone will generate at least $30,000 a year. Again, you won't even have to touch the principal, and it will grow over time.

There's no possible way for you guys to run out of money. Even when one of you dies, the interest alone on all that money will generate the extra $60k the survivor needs.

You don't even need to dip into the actual money you saved, like most of us (That's the point of saving it). You've gone so far beyond what you need, that you can live off just the interest from just a FRACTION of your portfolio, and the rest of your portfolio will just continue to grow.

(And this doesn't even include the $550k you have in your house).

Retire tomorrow. You have 0-30 years left on this planet. Note the ZERO. Don't waste it working if you don't want to.
Thank you.

bluelight
Posts: 312
Joined: Sun Jul 10, 2011 12:08 am

Re: How much money do you want to retire?

Post by bluelight » Fri Sep 28, 2018 1:58 pm

smitcat wrote:
Fri Sep 28, 2018 10:44 am
bluelight wrote:
Fri Sep 28, 2018 10:26 am
smitcat wrote:
Fri Sep 28, 2018 10:06 am
bluelight wrote:
Fri Sep 28, 2018 10:00 am
smitcat wrote:
Fri Sep 28, 2018 9:53 am



Your should be more then fine - have you run your numbers on a few retirement calculators to help relive your anxiety with your plans?
You are really in good shape.
Yes, I've tracked our expenses for the last 5 years and have run our numbers on Firecalc. I try to show my husband, but he would just rather worry that we will run out of money.
Perhaps run it on the extended IORP , or for more detail on the RPM spreadsheet calculator and play with things like Roth conversions and tax implications. Worrying is really not a good alternative....running the RPM may show you that waiting is not as much of an issue for 'spendable' money then you think. As you wait to implement your retirement for savings to grow you may also be closing some doors on Roth conversions and the net result will likely be unexpected for your situation.
Thank you. I'll take a look at the RPM spreadsheet. What is the extended IORP?

I know that I need to take a closer look at Roth conversions and also figure out the correct withdrawal order prior to retiring. I have seen info on BH, I just need to take the time to read it.
Extended IORP + https://www.i-orp.com/LumpSum/extended.html
Much easier to load and use the RPM allowing you to compare inputs quickly.
The RPM will take a bunch more time so perhaps only load that and play when you have a couple of your most likely scenarios.
The RPM will allow more details as well as an easy to compare chart for Roth and no Roth conversions.
It will take time but time making your plans and knowing you will be fine is well spent vs worrying.
Thank you.

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