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Old 10-02-2013, 03:23 PM   #41
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My goal is to have the same lifestyle pre- and post-retirement, both of them pretty darned good.
Same here.
I live well on X dollars a year. When dividend income from our portfolio reaches X dollars after taxes I am ready to FIRE. BTW I am all my life 100% in stocks
and it looks like we will work few years past the FI date.
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Old 10-03-2013, 12:42 AM   #42
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Originally Posted by LARS View Post
You know how much you need to retire? 50% more than you have... ha ha. The real point is it can become a moving target unless you can control/understand needs vs. wants. And only you can do that for your given idea of retirement.
Agree, it is different for all. LBYM has always been a good route, while remembering to enjoy life. Too many colleagues I have known deprived themselves to excess only to keel over a couple of years after retirement or have health issues. Like everything else, balance and common sense serve best. Travel when you can, and remember that life is too short to miss living.

I read somewhere that time shifting is a major cause of human unhappiness. "I'll be happy when..."
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Old 10-03-2013, 01:28 AM   #43
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However, we will likely work a few more years so that we will be able to "live the good life". Basically everything we earn from now until we retire can be spent on "wants" like travel, cars, giving, rv's, etc. etc.

How did you all decide how much "good life" budget you wanted in retirement?
We sort of did it the other way around. We weren't all that frugal before DH retired and I semi-retired. Part of that was that we had 3 kids with lots of expenses.

So, some things like that we've sort of been there, done that and don't really want or need to do it now. (I had my Corvette when I was 34 and it was great but I don't miss it now).

Anyway, we are probably different from many here in that our spending now is much less than what we earned during our working years and that is with kids in college. In a few years, it will go down again.

We are already spending much less than we spent, say, 5 to 10 years ago. But, I don't see that our lifestyle has changed in any material way.

Part of it is the usual stuff (lower taxes, don't need to save for retirement, expenses related to work) but part of was conscious decisions we made that greatly reduced ongoing expenses but didn't really change our lifestyle. For example, we moved into a smaller house with much lower maintenance costs. The house is just as nice as the one we sold. We just cut a lot of things but our lifestyle hasn't really changed mostly because the things we cut weren't the things that really mattered to us.

We did leave room for some things discretionary we want to do in retirement but when we really looked at it, most of them weren't really that expensive.
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Old 10-03-2013, 06:22 AM   #44
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Originally Posted by Malcolm2 View Post
Travel when you can, and remember that life is too short to miss living.

I read somewhere that time shifting is a major cause of human unhappiness. "I'll be happy when..."
+1 to this. I don't have to know all the answers, and in fact, believe they might be a bit illusory anyway. But I know time itself is a precious commodity and being happy is too important to wait for it.
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Old 10-03-2013, 06:40 AM   #45
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1) 2) Personally, I told myself that I would retire when I had an X-Sized nestegg, but then I got it and my X-goal just got ever bigger. Lee Eisenberg writes very eloquently about this phenomenon in his book "The Number" about how laughable his initial nestegg goal was. That book, by the way is a great read if you are interested.
+1

My first concept of retirement came soon after I started work at an ultra-mega corp. I looked at my pre-401k thrift plan and was impressed how fast it was growing. I thought that if I could ever amass $200,000 I'd be set for life. At the time I made $12K and 8% government bonds were available. Times have certainly changed.
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Old 10-03-2013, 10:08 AM   #46
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The lifetime spending models often assume that spending more money now will make you happier. After a certain point of having your needs met, most research shows that spending more money doesn't buy more happiness.
I recall reading recently that the median saturation point was 75K/yr, so assuming a 3% SWR, this works out to 2.5M USD minus 33x your annual income from pensions and social security.
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Old 10-03-2013, 12:05 PM   #47
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We had enough when we retired but we have even more after three years of retirement.

We got rid of a lot of 'things' and expenses in order to transition to a retired life with lots of travel. The 3600 sq foot home has been replace by a 1400 sq. foot rental condo and we love it. Two cars down to one in the next month. Traded a suburban lifestyle to one just on the edge of downtown with great access to rapid transit.

So our projected expenses would have been the same, but our desired change in lifestyle has actually reduced our expenses. At the same time, the equity from our former home is earning a higher return than we anticipated. All good for the moment.
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Old 10-03-2013, 12:47 PM   #48
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We had enough when we retired but we have even more after three years of retirement.

We got rid of a lot of 'things' and expenses in order to transition to a retired life with lots of travel. The 3600 sq foot home has been replace by a 1400 sq. foot rental condo and we love it. Two cars down to one in the next month. Traded a suburban lifestyle to one just on the edge of downtown with great access to rapid transit.

So our projected expenses would have been the same, but our desired change in lifestyle has actually reduced our expenses. At the same time, the equity from our former home is earning a higher return than we anticipated. All good for the moment.
That is close to our plans, but you are much further along. Good job.
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Old 10-03-2013, 01:30 PM   #49
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My goal is to be like brett. When you travel do you keep home base condo or just pick up and leave?
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Old 10-03-2013, 04:47 PM   #50
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My goal is to be like brett. When you travel do you keep home base condo or just pick up and leave?
We are doing this next year too. But we will travel and not have a home base due to not knowing where we want to live.

I have costed it all out and it would be at least 30%-50% cheaper for us to travel than live somewhere (in Australia, where we are) and live a middle class lifestyle.

We have two young children and have decided to show them the world. We have committed to coming "home" and renting somewhere close to family for 3 months each year so the children can continue relationships with them, as can we.

But I am sure we will have many visitors along the way.

We are planning to start in Asia and then Europe, Italy and France especially, and then perhaps Season in different places, for 3-6 months at a time to help immerse ourselves into a community and a language and also keep costs down.

We will also have our "house" money rolling over and not being touched as an extra investment so we can come home or settle somewhere at any time.

I agree, the minimising and downshifting is liberating to say the least!!

Is anyone else planning something similar?
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Old 10-03-2013, 11:06 PM   #51
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We are planning to start in Asia and then Europe, Italy and France especially, and then perhaps Season in different places, for 3-6 months at a time to help immerse ourselves into a community and a language and also keep costs down.
Unless you have dual citizenship you are limited to 90 days anywhere in the EU/Schengen Zone every 12 months. They are serious about that. France and Italy are both in the Zone as is most of Europe except Switzerland. Virtually impossible to get a long-term visa in Switzerland as an American without a work reason.

There are other issues with being without a base, but I'm sure you have researched them. Special issues with kids as well.

We lived and worked in Europe with a different type of visa for years before recently returning to the States. We will keep a house here but plan 1-2 month stays in different places each year.
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Old 10-04-2013, 07:20 AM   #52
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Same here.
I live well on X dollars a year. When dividend income from our portfolio reaches X dollars after taxes I am ready to FIRE. BTW I am all my life 100% in stocks
and it looks like we will work few years past the FI date.
If you're only living on dividend income (and not considering principal at all) and not considering SS then you'll probably end up working much longer than you need to.

Also, remember that most dividends will not be taxable if your taxable income is in the 15% bracket or lower.
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Old 10-04-2013, 08:05 AM   #53
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Like most, I crunched the numbers every which way and will always be on top of my where I currently stand. Again like most, a lot of thought has been given to possible scenarios going forward and how they would be addressed. There's always lots of uncertainties, "unique" current events and at times some anxiety dealing with so many unknowns. The one certainty though is that time is not a renewable resource and I made the transition to be more worried about not maximizing that than the possibly never ending pursuit of accumulating a bigger safety cushion.
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Old 10-05-2013, 02:52 AM   #54
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Don't get sucked into the golden handcuffs! If you have enough to retire do it. We were going to retire Oct. 1, 2013. Instead we retired August around the 1st when my wife was diagnosed with aggressive breast cancer. Yes, we now have regrets of not doing it sooner. You have one life, don't wait!
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Old 10-05-2013, 04:12 AM   #55
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It sounds like you are in a great place financially. I was in a similar position 5 years or so before I actually retired. What my wife and I did at that point was to tilt the balance a little more towards experiences in the present rather than saving quite so much for the future. We started taking better vacations and created a lot of wonderful family memories in the process. Our overall spending went up a bit too, but by that time our investments were growing more by investment gains than they were by what I added so it didn't seem to matter.
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Old 10-05-2013, 07:35 AM   #56
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It is so hard because right now we are in peak earnings years (45 & 42) and really socking away a lot of money. It just seems foolish to walk away from that, when every additional year can permanently add that much more to the monthly budget. Things would be a lot easier if one of us would get fired or something.
This is pretty much our situation, too, though ages are a little different (DH 55, me almost 45). I'm on the verge of some kind of promotion at work -- could be a very significant one -- and if that comes through I want to at least try it for a few years and see what happens. The work is stressful but meaningful, and I could potentially make a big difference. If it doesn't work out then I will likely start focusing my energies on convincing DH we should FIRE sooner rather than later.
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Old 10-15-2013, 03:55 PM   #57
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These links might be of interest to this discussion:

http://www.dfaus.com/pdf/How_Much_Should_I_Save.pdf

http://www.dfaus.com/pdf/RetirementI...Summer2012.pdf

According to the research, anywhere from 82% to 58%, depending on your income level. If I read the report correctly, that equates to an income stream from savings of 23% to 37%, with the remaining needs met by SS. They use 40% as the goal.
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Old 10-15-2013, 04:22 PM   #58
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Unless you have dual citizenship you are limited to 90 days anywhere in the EU/Schengen Zone every 12 months. They are serious about that. France and Italy are both in the Zone as is most of Europe except Switzerland. Virtually impossible to get a long-term visa in Switzerland as an American without a work reason.

There are other issues with being without a base, but I'm sure you have researched them. Special issues with kids as well.

We lived and worked in Europe with a different type of visa for years before recently returning to the States. We will keep a house here but plan 1-2 month stays in different places each year.
Hi, thankyou for your information.

I thought it was 90 days for every 180 days that you could be inside the EU zone.

We have planned on that advice to initially have 3 months in Italy, then 3 months in either the UK or Switzerland then 3 months in France to comply with the EU visa stuff.

But if we can prove that we earn enough money France Italy and Germany have long term 12 month + visas that we can apply for and apparantly they are not too difficult to obtain. The German one is a self employed web-style one, but as long as you have the income level they require you can apply with just a blog or basic webpage.

If anyone is interested I can post an interesting link on EU Visas.

We are Australian so in the UK we can stay for 6 months at any time and I can apply for an ancestral visa if we want to eventually.

But we will most likely move every three months at this stage, for the first 2 years anyway. Then we may find a base for 12months or so after that. Who knows where....?

Does anyone else NOT include the princpial in their SWR? We are only including the income from the principal in our calculations as we will be 42 and 38. Obviously that is a safer option, but just curious as to what the "proper" calculation would be.
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Old 10-15-2013, 04:31 PM   #59
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Enough is when you can live your life as well as when you were working. I got laid off when I was 56 but realized we were not deprived of anything we had done before. I did a couple of odd end jobs but then realized that they were not really adding to what we already had. Once my military pension came in at 60 I knew we were set.
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Old 10-15-2013, 05:48 PM   #60
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I recall reading recently that the median saturation point was 75K/yr, so assuming a 3% SWR, this works out to 2.5M USD minus 33x your annual income from pensions and social security.
These studies make a lot of assumptions when stating that "happiness is maximized at 75k / yr". For one, they pretty much assume one would just spend blindly what they make and that 75k is enough to come near the peak happiness (however that's defined!). With or without kids? With a big, fancy house or plopping around the Bahamas on a 30' sailboat like the Pardeys? For my wife, dog, and myself, we've reached our happiness at around 25k-30k / year (not necessarily related to what we make). I expect to stick around that number my whole life if health allows and semi-retire in my 30s instead. Work will just be financial gravy and enjoyable projects.

It just takes a bit of creativity to cut that 75k in half. I've read of plenty of folks that add about 5k/yr for each kid (transfer payments definitely help as earned income drops) so I might be at 35k-40k if I had some little ones. Some add less, some WAY more with all the 3 year old resume building insanity.

I say find your own number, add 25% for safety buffer if you want or just work part time in something you love, and find a way to fund it. Then you have "enough".

Earlyretirementextreme.com : Low income path to FI
Mrmoneymustache.com: middle income path to FI
FinancialSamurai.com: high income path to FI

All three paths have happy folks at the other end...
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