Just retired at 62 and I hope I saved enough??

[ncbill]

One other concern I might point out for higher NW folks “struggling” with thier RE decisions, the old saying the bigger they are, the harder they fall can haunt many of us. Yes, it is relative, but in real $$, it can feel more impactful. Eg. using a 4% WR, if a $1m portfolio loses 20% that is an $8k hit on the WR while it’s a $64K hit on $8m. While both are relatively significant, I might argue the $64k hit might hurt more psychologically, thus often adding some more tension/OMY analysis to the higher NW guys. Just another perspective.

AFAIK he didn't specify the composition of the IRA, but if it is 100% equities that means his asset allocation is ~75% equities, ~25% fixed income/cash.

Given his spending, which he feels needs to be sustained for now, I'd suggest flipping that ratio by making sure the IRA is rebalanced to $3-$4 million in (shorter duration) fixed income.

I.e. following the "rising equity glide path" approach in order to mitigate sequence-of-return risk.

 

[DawgMan]

How much is your number 2 budget?

It has some "depends" in it like charity amount, but call it $220K - $230K taxable. Budget 3) can obviously go down substantially further. In my case, I only have a little bit of house debt I will probably pay off when I launch (low 3% interest rate range so I go back and forth). There is significant discretionary $$ in my budget as I am sure there is in most higher RE spenders (assuming they have no/low debt). As stated earlier, the "creep" has a way of increasing your "needs" which are really "wants" when you step back and look at them. I think the key here is being honest with yourself and prioritizing what you really need/want for you RE spend and then being flexible based on what your assets may support in any given year without hopefully jeopardizing your future. This is the exercise I am trying to run with DW before I launch. I realize no one can forecast the future uncontrollables, but I would like to try and launch with my eyes wide open running some traps on the things I do have some control of. Will see what happens!

 

[haha]

Is this a serious question, or are we being punked? You have $8,100,000 dollars at the age of 62 and your house is almost paid off and you want to know if you can retire?

We are being punked. No one smart enough to put together $8 million is dumb enough to ask a bunch of strangers if he can do anything.

Ha

 

[The Cosmic Avenger]

...Caymus to Two Buck Chuck...

::

I assume that's like going from Macallan 18 to Evan Williams?

(Seriously though, thanks for getting me thinking about it....I might need to break out whisky/bourbon and craft beer in my entertainment budget when I plan for retirement! It's a huge part of it for me, including not just bottles but tasting events.)

 

[Letj]

What most of us can't fathom is needing to spend $250K/year! If you had a couple of boats, a few houses, a few condos....or race cars or race horses, it would be easy. So, the real question is, Franklin, how much of that do you really need to spend to be satisfied, and how much of that are you just used to spending? Obviously, you could easily cut back if you needed to, regardless of whether you'd want to. SO, if retirement (time) is more important than money, you know the answer.

What you’re describing seems like they would require much more than $250K annual income; more like $1,000,000.

 

[lribookend]

As I have learned, it doesn't matter how much money you take in, it matters how much you spend. Move to a very low cost of living state and live like a king. Or stay in California. Easy decision in my mind.

 

[Franklin]

thanks moving back east in 9 months.

 

[StuckinCT]

You are in good shape no matter how you slice it. You will need likely $300,000 annually to net $250,000 after tax with so much in retirement accounts assuming you pay state income tax. Even so, with social security and even a conservative 3% withdrawal rate you should be more than fine. You could comfortably go as high as 4% at your age so with Social Security you could even probably spend $300,000 annually; but if you don't need to, why push it. I have a similar net worth but I am 47 with three young kids. I think even at my age you could go up to 4%, but as of now I am at 3.33% which is my investment income...