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Financial discussion variables
Old 06-09-2013, 12:34 PM   #1
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Join Date: Jul 2012
Location: Peru
Posts: 4,652
Financial discussion variables

Variables that often vary, when relating some of our discussions. Not usually an issue when the retirement assets are substantial but for those of us who expect to "spend down", and where the "cushion" may be a bit thinner, the broader numbers sometimes get confusing.

-one person?
-government definition of household (2.6 persons)?
-two persons? (retired couple)
-retirement advice websites definition?

-Wiki definition?
-Include or exclude Social Security?
-one or two persons?
-use SS net present value? (conversion tables)
-use Pension net present value?
-include house net value or not?
-include personal property jewelry, collections, autos, furniture etc.?

-include or not?
-based on historical or estimated ?
-apply to investment income?
-apply to expenses?

-percent of pre-retirement income?
-actual itemized post retirement expenses?
-tiered expenses according to age, events or known expenses?

-100% retention of capital?
-die broke?
-plan for inheritance?
-one or two person option?
-spend down plan?

-life insurance policies?
-health insurance policies government?
-health insurance policies supplements?
-health insurance policies other (dental, vision)?
-nursing home policies?
-catastrophic policies?


As DW and I look at our assets, our current expenses, and projected changes in our lifestyle, it is clear that our remaining years will see major reductions in current expenses, as in going down to a single vehicle, selling our Florida retirement home, and our local lake camp. Things like travel, which used to be 15 to 20 thousand miles a year are now down by two thirds. In all, our annual expenses look to be reduced by 40% as we reach towards our eighties. For us, the expense factor is even more important in planning, than the assets or income, since our assets are for the most part, "fixed" and ultra-conservatively invested.

Your mileage will vary.

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Old 06-09-2013, 07:44 PM   #2
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Join Date: Feb 2011
Posts: 1,629
Strongly agree there's quite a broad range of variables which can make it difficult to offer advice on the forums. I've always thought it odd when someone asks if they can ER at, say, 55 with a nest egg of $X. Makes a huge difference if that person would be ERing with a decent pension & benefits (HI, etc.) vs ERing after selling a small business with little else except that nest egg.
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