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45 years old - 2.5% SWR - retire or not?
Old 07-20-2010, 04:24 PM   #1
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45 years old - 2.5% SWR - retire or not?

A quick poll - I'm 45 years old and figuring all expenses (basic living, health insurance, 10K replacement / repair fund) I'd have a 2.5% SWR on my 55/45 portfolio. Darned sick of my own business that I've been in for 25 years and would likely take a year or two or maybe more off and then either go to work part time for someone or start my own one man business.

My quick question - Do it or don't?
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Old 07-20-2010, 04:27 PM   #2
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I forgot to add that everything is paid off - there is no debt
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Old 07-20-2010, 04:32 PM   #3
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Who manages your investments? If you have an adviser that sucks 1%+ off your portfolio every year, I may have to change my vote to "DON'T DO IT!!!!!!!".

Otherwise you are pretty golden.
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Old 07-20-2010, 04:32 PM   #4
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Originally Posted by tomc5179 View Post
" and would likely take a year or two or maybe more off and then either go to work part time for someone or start my own one man business. "
This, along with your very low SWR, means you have so much flexibility that your chances of success are very high.

You certainly can afford to take a nice break right now.

Edited to add: Oh Yeah - FUEGO gives a key caveat.

Audrey
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Old 07-20-2010, 04:39 PM   #5
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I agree with the others...especially if you have funds you can get to without having to pay a penalty.
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Old 07-20-2010, 04:42 PM   #6
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A quick poll - I'm 45 years old and figuring all expenses (basic living, health insurance, 10K replacement / repair fund) I'd have a 2.5% SWR on my 55/45 portfolio. Darned sick of my own business that I've been in for 25 years and would likely take a year or two or maybe more off and then either go to work part time for someone or start my own one man business.

My quick question - Do it or don't?
I think you can do it, too. And that is because my SWR when I was 45 2 years ago was also 2.5%. And my AA was 55/45 at the time (but has changed in order to provide me with more income).

So if it was good enough for me to retire on very comfortably, it should be good enough for you, too!
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Old 07-20-2010, 05:49 PM   #7
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My quick question - Do it or don't?
I'd have done it at 3%.
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Old 07-20-2010, 05:51 PM   #8
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Do it.
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Old 07-20-2010, 05:53 PM   #9
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Numbers look great - assuming your budget allows you to accomplish what you want - if the 2.5% SWR equates to a $10,000 annual spending budget - then that may be a low SWR - but no way I'd want to live...
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Old 07-20-2010, 06:02 PM   #10
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If you need a poll you're not ready. If your portfolio can sustain you with a 2.5% withdrawal rate and you're still not sure, perhaps you should think about your goals a bit more.
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Old 07-20-2010, 07:52 PM   #11
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You need a third choice.

"I don't give a ****"

Ha
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Old 07-20-2010, 08:05 PM   #12
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You need a third choice.

"I don't give a ****"

Ha
Stock market was up! You should be in a good mood.
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Old 07-20-2010, 09:46 PM   #13
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A 2.5% WR suggests you are financially ready to retire (even without factoring in your plans to resume working in one form or another after a couple of years).

As Delawaredave5 said, this assumes that your WR is based on an appropriate and relalistic level of estimated expenses. Have you tracked historical expenses accurately and done a budget - I ended up revising my "number" upwards after doing that exercise.
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Old 07-20-2010, 09:58 PM   #14
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Stock market was up! You should be in a good mood.
You are absolutely correct. I should have said, Sir, do as you wish, Sir, as it is your money and your life.

If somebody says "I have $400,000 and I need $30,000 a year and I am 22", I have an opinion. But when someone says my WR is 2.5% and asks if he can retire I suspect OAP. It is just too absurd to discuss.

BTW, I miss OAP. He had some nice sidewalk-life shots

Ha
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Old 07-20-2010, 10:11 PM   #15
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You are absolutely correct. I should have said, Sir, do as you wish, Sir, as it is your money and your life.

If somebody says "I have $400,000 and I need $30,000 a year and I am 22", I have an opinion. But when someone says my WR is 2.5% and asks if he can retire I suspect OAP. It is just too absurd to discuss.

BTW, I miss OAP. He had some nice sidewalk-life shots

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He had a blog for awhile. Moved from one city to the next, experiencing different cultures. Lost track of him though.
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Old 07-20-2010, 10:59 PM   #16
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Tomc, are you stlll single? In '05 you were planning to marry; that could change your numbers.
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Old 07-21-2010, 06:09 AM   #17
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Tomc, are you stlll single? In '05 you were planning to marry; that could change your numbers.
Correct - I am single now (but have been living together with fiancee for the past 5 years) and will be getting married in October of this year. I have been following all my expenses daily for the last five years. I pay 100% on prop tax, utilites, etc. She pays a small part on groceries. I am happy with this and also have a thorough pre-nup that has been executed.

What can I expect marriage to do to my taxes?

Also, Fuego wondered if I had any high cost brokers handling my money - I do have about a third of it from a long time ago at Wells Fargo. I know I need to get that moved. Anybody had any experiance with calling Vanguard and having them move accounts?
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Old 07-21-2010, 06:39 AM   #18
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Correct - I am single now (but have been living together with fiancee for the past 5 years) and will be getting married in October of this year. I have been following all my expenses daily for the last five years. I pay 100% on prop tax, utilites, etc. She pays a small part on groceries. I am happy with this and also have a thorough pre-nup that has been executed.
You say you are 45. What about her? Kids on the way could change everything.
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Old 07-21-2010, 06:57 AM   #19
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You say you are 45. What about her? Kids on the way could change everything.
She's 46 and has been "fixed". Neither one of us have any desire to have kids.
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Old 07-21-2010, 07:51 AM   #20
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You are absolutely correct. I should have said, Sir, do as you wish, Sir, as it is your money and your life.
I thought you said it better the first time
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