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Old 12-12-2015, 11:26 AM   #21
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Retired Jan 1, 2008, so almost 8 years in and my liquid (does not include house) net worth is approx. 25% higher. So far, so good.
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Old 12-12-2015, 11:36 AM   #22
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I retired at the end of October, 2008, just as the markets were crashing. (This was a GOOD thing because I bought thousands of shares of a bond mutual fund at bargain-basement prices.) The markets kept falling into early 2009 but they rebounded quickly and even now I am up about 50% since then with a majority-bond portfolio.
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Retired in late 2008 at age 45. Cashed in company stock, bought a lot of shares in a big bond fund and am living nicely off its dividends. IRA, SS, and a pension await me at age 60 and later. No kids, no debts.

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Old 12-12-2015, 01:40 PM   #23
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I retired in July 2013. Two and a half years later, net worth is 17% higher. We make very small withdrawals, less than 1%. Pensions, rentals, and dividends cover basic living expenses.
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Old 12-12-2015, 01:51 PM   #24
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It seems to me that people who plan to withdraw 4% from their investments will see the real value of their investments
go up if those investments yield more than 4% real, and
go down if those investments yield less than 40% real.

Since most people here have investments with market values that can fluctuate by double-digit percents in a single year, the answer the to the OP question will depend primarily on when people happened to retire.
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Old 12-13-2015, 09:55 AM   #25
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Originally Posted by Independent View Post
It seems to me that people who plan to withdraw 4% from their investments will see the real value of their investments
go up if those investments yield more than 4% real, and
go down if those investments yield less than 40% real.

Since most people here have investments with market values that can fluctuate by double-digit percents in a single year, the answer the to the OP question will depend primarily on when people happened to retire.
Yes, this is what I was trying to say. You said it much better than I. We are at the mercy of the market.
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Old 12-13-2015, 02:47 PM   #26
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Yes, this is what I was trying to say. You said it much better than I. We are at the mercy of the market.
Thanks.

But, re-reading my post, I see a typo. I expect you read it the way it was intended. It should have said:

It seems to me that people who plan to withdraw 4% from their investments will see the real value of their investments
go up if those investments yield more than 4% real, and
go down if those investments yield less than 4% real.

Since most people here have investments with market values that can fluctuate by double-digit percents in a single year, the answer the to the OP question will depend primarily on when people happened to retire.
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Old 12-13-2015, 03:33 PM   #27
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I am in my 6th year, and my NW continues to grow. I get SS and a small pension, My wife gets survivor's SS and a small pension. That income covers all our spending at this point.
Another nice thing is that the value of my IRA's increases every year even though I take out the RMD.
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Old 12-13-2015, 03:51 PM   #28
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Since most people here have investments with market values that can fluctuate by double-digit percents in a single year, the answer the to the OP question will depend primarily on when people happened to retire.
Yup. Sequence of returns is key.
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Old 12-13-2015, 04:01 PM   #29
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I saw the typo and knew he meets 4%, because I don't his money will last long with 40%.


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Old 12-13-2015, 04:25 PM   #30
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I am curious about this topic. While obviously it is great to say that your net worth has gone up since your retired...but, is that really the goal of most people who are retired? I plan to leave a little bit behind for my kids, but my wife and I will have worked and saved for a long time when we finally retire, we plan on enjoying life. Obviously, we will live within our means, but if our withdrawal rate results in small decreases in net worth over the years, I'm not going to be too concerned. If we retire with our pensions and have (for example) $800K in savings, I don't plan on dying with $800K+ in our accounts.
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Old 12-13-2015, 04:39 PM   #31
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I am curious about this topic. While obviously it is great to say that your net worth has gone up since your retired...but, is that really the goal of most people who are retired?
If you are happy and can increase your NW, why spend more? At least some studies show that after a certain point, spending more money does not bring more happiness. Of course if you need basics like food, housing or medical care, more spending is probably going to make you happier. But if you already have a closet full of clothes and a house full of stuff, is spending more on even more consumer goods really going to increase your happiness levels?
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Old 12-13-2015, 04:54 PM   #32
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Originally Posted by HomesteadDreamer View Post
I am curious about this topic. While obviously it is great to say that your net worth has gone up since your retired...but, is that really the goal of most people who are retired? I plan to leave a little bit behind for my kids, but my wife and I will have worked and saved for a long time when we finally retire, we plan on enjoying life. Obviously, we will live within our means, but if our withdrawal rate results in small decreases in net worth over the years, I'm not going to be too concerned. If we retire with our pensions and have (for example) $800K in savings, I don't plan on dying with $800K+ in our accounts.
Small decreases in NW are fine. Big decreases are another story, especially if (a) they occur in the first few years, thereby having a disproportionate negative effect on long term portfolio sustainability and (b) there is no pension. Those with pensions have a buffer against market crashes and should consider themselves very fortunate.
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Old 12-13-2015, 06:31 PM   #33
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Retired at 58 (6 years now), and every year has been positive growth for taxable/retirement accounts - so far. We draw only dividends off 52/48 (stock/bond) taxable accounts for living expenses. IRAs keep growing - will be doing Roth conversions before RMDs begin.
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Old 12-13-2015, 07:08 PM   #34
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Originally Posted by HomesteadDreamer View Post
I am curious about this topic. While obviously it is great to say that your net worth has gone up since your retired...but, is that really the goal of most people who are retired? I plan to leave a little bit behind for my kids, but my wife and I will have worked and saved for a long time when we finally retire, we plan on enjoying life. Obviously, we will live within our means, but if our withdrawal rate results in small decreases in net worth over the years, I'm not going to be too concerned. If we retire with our pensions and have (for example) $800K in savings, I don't plan on dying with $800K+ in our accounts.
I do not either, which is why I am distributing the yearly RMD to the children rather than rolling it into a taxable account. My mom lived to 102, so I am planning for another 25 years not to run out of money. The children can use the money now, not later.
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Old 12-13-2015, 09:13 PM   #35
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I know that the point where passive income (from all stocks and bonds for us) exceeds spending is the inflection point of FI and I wonder if it is likely to continue?
That is a great point to be at.....but many ER plans include spending of principal to maximize income and the ideal plan is thought by some to be one where you have zero net worth when you die. Very few people go into retirement expecting their net worth to increase and the 4% SWR is predicated on your money lasting for some time with some probability.

Personally I use a liability matching approach from guaranteed income sources and reinvest any gains from the market so I expect my net worth to increase through retirement.
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Old 12-14-2015, 07:49 AM   #36
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Quick reminder that the SWR is based on a fixed withdrawal from the nest egg at the time of retirement, and not the rate this year. I look at both, but the sequence of returns risk does not change. SWR can increase in down years, and decrease in up years.
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Old 12-14-2015, 08:12 AM   #37
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Retired going on 4 years. NW up about 20% since I retired.
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Old 12-14-2015, 10:51 AM   #38
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While increasing their portfolio size may not be he primary goal of most retirees, it does add a further degree of flexibility to your retirement plans. You could up spending, charitable giving, gifts to children, etc. Seems much better than the alternative scenario?

In my case if I keep just spending portfolio income, it is pretty likely our portfolio will grow. This is not our objective though so over time we will have to find new uses for some of the portfolio. Current markets might assist here?
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Old 12-14-2015, 11:00 AM   #39
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...did you see your net worth continue to RISE in your first few years post-work, or did it gradually start to FALL as you spent for your lifestyle?...
Ours rose but we retired 4 years ago.... just before some really good years of investment performance (about 11%/year since we retired). We are at about 120% of what we had when we retired and peaked at about 125%. And that is after spending money on travel, a new garage and a new car in addition to living expenses.

I don't expect that investment performance to last and part of the reason that our spending splurged was that our portfolio was doing so well.
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