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Old 01-24-2016, 01:36 PM   #121
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Exactly. You gotta live somewhere, and unless that somewhere is under a bridge, there's going to be a financial cost involved.
Right. I just prefer to pay for my house outright, and then take a smaller annual withdrawal (that doesn't include rent or mortgage) from a similarly smaller nestegg (smaller because I paid for the house in cash).

The recommended WR isn't affected AFAIK.
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Old 01-24-2016, 01:42 PM   #122
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The recommended WR isn't affected AFAIK.
True, but your house is an asset that you could sell if you needed the money for residential long term care. Renters don't have that option.
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Old 01-24-2016, 02:20 PM   #123
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True, but your house is an asset that you could sell if you needed the money for residential long term care. Renters don't have that option.
I suppose. We do have to live somewhere, though, and residential long term care can involve buying into a CCRC and/or renting, so I am thinking that one is still faced with the buy/rent/pay-off-the-housing dilemma.
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Old 02-22-2016, 05:14 PM   #124
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I'm planning a similar 5-6.5% withdrawal rate in 3 years and for 3-4 years until I'm 64 and eligible for early SS. If the portfolio is high enough to take a 4% at that point, I'll defer until full SS; if not, I'll consider taking early after considering the RMD at 70.5.
I'm currently on "modified employment" that pays 40% of my prior salary to work part-time, pretty much on my own schedule, and DW is younger and will work longer, although at about 60% of her salary before we moved from Houston to here. I may get extended at least one more year, so unlike what I initially planned, I probably won't start making withdrawals until 2018, which probably will allow me to boost the withdrawal rate a little more. The joker in the pack is if DW loses her job, but my plan is for her to stop when I did, at 57. That's when the 6.5% to 7% rate would kick in, for 3-4 years.


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Originally Posted by REWahoo View Post
MuirWannabe posted a link to this old thread so I thought I would update my chart to show where we are after 10.5 years of retirement. The chart is explained at the beginning of this thread.

Our calendar year withdrawal rates to date shown as a percentage of our initial portfolio value the day we retired in 2005:

Year 1: 4.8%
Year 2: 9.8%
Year 3: 7.9%
Year 4: 6.1% (SS begins for me)
Year 5: 5.4% (SS begins for DW)
Year 6: 4.2%
Year 7: 3.9%
Year 8: 3.5%
Year 9: 3.7%
Year 10: 4.5%

As you can see from the jump in our withdrawal rate this year, we've loosened up the purse strings a bit.

Still, so far, so good...
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Old 02-22-2016, 09:15 PM   #125
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Originally Posted by REWahoo View Post
MuirWannabe posted a link to this old thread so I thought I would update my chart to show where we are after 10.5 years of retirement. The chart is explained at the beginning of this thread.

Our calendar year withdrawal rates to date shown as a percentage of our initial portfolio value the day we retired in 2005:

Year 1: 4.8%
Year 2: 9.8%
Year 3: 7.9%
Year 4: 6.1% (SS begins for me)
Year 5: 5.4% (SS begins for DW)
Year 6: 4.2%
Year 7: 3.9%
Year 8: 3.5%
Year 9: 3.7%
Year 10: 4.5%

As you can see from the jump in our withdrawal rate this year, we've loosened up the purse strings a bit.

Still, so far, so good...
Isn't it actually that your portfolio shrank in 2015? It dropped due to your withdrawal at the beginning, then probably went down some due to market drops.
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Old 02-22-2016, 10:13 PM   #126
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Isn't it actually that your portfolio shrank in 2015? It dropped due to your withdrawal at the beginning, then probably went down some due to market drops.
The graph in post #91 shows how my portfolio has performed (relative to the three FIRECalc examples) since 2005. The 2015 portion of the line has a slightly downward slope.
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Old 02-22-2016, 10:49 PM   #127
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I would assume this scenario is not based on a bucket strategy where at least 2-3 years of income is set aside in cash accounts to be used before mid and long term investment buckets?


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Old 02-23-2016, 07:28 AM   #128
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I would assume this scenario is not based on a bucket strategy where at least 2-3 years of income is set aside in cash accounts to be used before mid and long term investment buckets?


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Don't most bucket strategies have a plan for refilling the cash bucket along the way...

In other words - the bucket strategy is just a normal asset allocation with the cash/fixed portion being the cash bucket.

If you just use up the cash bucket, without refilling it - what happens if the market is down when you run out of cash?
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Old 08-08-2017, 01:40 PM   #129
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Update:

Since there was some recent discussion of this old thread I thought I would update the graph showing where I stand after 12 years of retirement.

Note that this reflects nominal dollars - no adjustment for inflation.
Attached Images
File Type: jpg REW 12 year plot.jpg (49.9 KB, 88 views)
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Old 08-08-2017, 01:47 PM   #130
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Update:

Since there was some recent discussion of this old thread I thought I would update the graph showing where I stand after 12 years of retirement.

Note that this reflects nominal dollars - no adjustment for inflation.
Excellent, REWahoo! This is sure encouraging.

(Just to remind people with memories as hazy as mine, the origin/meaning of these lines is explained in the first post of this thread.)
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Old 08-08-2017, 02:28 PM   #131
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Thanks. Great news. Just to make sure I understand, is the green line the best possible outcome in Fire Calc, the red line the worst, and the blue line the nominal or average?

Would be interesting to know if you look at all the scenarios after 12 years, what percentile are you at?
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Old 08-08-2017, 02:32 PM   #132
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Thanks. Great news. Just to make sure I understand, is the green line the best possible outcome in Fire Calc, the red line the worst, and the blue line the nominal or average?
None of the above. The Green line is Bob, the blue line is Betty and the red line is Bill.

The basis of the graph is found in the "real numbers" example of How FIRECalc Works, found here: FIRECalc: Why another retirement calculator?

An explanation of my plot on the graph is found in the first post on this thread.
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Old 08-08-2017, 02:36 PM   #133
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I'll bet you're looking forward to that big leap after the 21 year mark!
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Old 08-08-2017, 02:41 PM   #134
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I'll bet you're looking forward to that big leap after the 21 year mark!
Yep, I'm hoping I'm not taking a dirt nap by then the two decades I'll have spent setting it up will really pay off!
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Old 08-08-2017, 02:43 PM   #135
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I'll bet you're looking forward to that big leap after the 21 year mark!
Would that be predicting the future?
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Old 08-08-2017, 05:18 PM   #136
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Excellent, REWahoo! This is sure encouraging.

(Just to remind people with memories as hazy as mine, the origin/meaning of these lines is explained in the first post of this thread.)
FYI:
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Shown here are the year-end balances of three identical portfolios. One starts in 1973 (red), another in 1974 (blue), and the third in 1975 (green).
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Old 08-08-2017, 05:26 PM   #137
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Update:

Since there was some recent discussion of this old thread I thought I would update the graph showing where I stand after 12 years of retirement.

Note that this reflects nominal dollars - no adjustment for inflation.
Good job! are Mr & Mrs Wellesley/Wellington still in your employ?
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Old 08-08-2017, 05:36 PM   #138
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Yep, I'm hoping I'm not taking a dirt nap by then the two decades I'll have spent setting it up will really pay off!
: I cheated. After two decades I married and the second round came with a pension, portfolio and a farm. Plus my first two decades I had some temp work, rental RE sold and consumed not to mention SS, a small pension and of course some -heh,heh- psst Wellesley.

Yours is the better chart.

heh heh heh - I am happy to say my 'yes but' has been wrong most of the time or at least conservative the last 24 years while the 2-6%, 4% target withdrawal and stay the course manta has held up well. My shift to Target Retirement 2015 and 'few good stocks in 2006 has been successfully boring.
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Old 08-08-2017, 05:55 PM   #139
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are Mr & Mrs Wellesley/Wellington still in your employ?
Yes, they are carrying 2/3 of the load for me.
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Old 08-09-2017, 09:48 AM   #140
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Yes, they are carrying 2/3 of the load for me.
Are you weighted more on the Wellesley side or the Wellington side? I too have them and often question myself if I should tilt to one side or the other or go 50/50. Right now, I'm heavier on the Wellington side.
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