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question for those who have already retired
Old 04-20-2011, 07:24 PM   #1
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question for those who have already retired

Since I know many run the retirement calculators that draw me like a bee to a flower, have you found that your results from Firecalc, orp, Merrill edge, for example, have proven pretty reliable in actual life? And if so, for how long have you been retired and looking at these figures? Thanks!
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Old 04-20-2011, 07:30 PM   #2
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I believe you'll need to ask that question again...

in about 30 years or so. That way we'll see if FireCalc worked or not.

Seriously, what you ask isn't knowable until the end.

The model for Firecalc is that past is prologue. So if the markets behave in cycles kind of like they have in the past then Firecalc will be a good model.
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Old 04-20-2011, 07:34 PM   #3
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Not sure about Merrill Edge but I'd guess that it tells you that you never have enough. I'd guess that they want you to work and invest forever so they can keep taking your money.
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Old 04-20-2011, 08:05 PM   #4
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I used many retirement calulators including my own model to help me make the decision of whether I had enough to retire. After nearly two years into retirement, my investment account has exceeded the expectations of the calculators...which of course makes me very happy on one hand, however, on the other hand, I have to factor in that I'm in a bull market. Who knows what will happen in a bear market! It is truely a crap shoot!
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Old 04-20-2011, 08:11 PM   #5
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Who knows what will happen in a bear market!
I do.
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Originally Posted by Budman View Post
It is truely a crap shoot!
You definitely got one of the terms correct...
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Old 04-20-2011, 08:27 PM   #6
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The calculators only get you so far. And there isn't much of a historic record where markets are valued, like they currently are, to offer a 3.35% 10-year Treasury yield and 1.76% dividend yield. Given those valuations, it makes sense to add a decent amount of cushion to whatever the calculators deem 'safe' and then have a realistic 'Plan B' just in case that cushion isn't enough.
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Old 04-20-2011, 09:12 PM   #7
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It's only been a few years for us, and an awful lot depends on dumb luck in regards to the stock market and life in general. So far so good. We knew exactly how much we spent through years of tracking and had no debt so we can cut back a lot of expenses if need be and survive. when we used the calculators we had a bare minimum yearly withdrawal, medium, and high on the hog level. I never would have gone out on even a medium figure- just too many unknowns.

People that I know that have made a good wage and not been successful in retirement or not been able to early retire either had "life" happen to them (ie. divorce, sickness, ending up raising grandkids), or made bad choices.
Like 100% in company stock right before it plummeted, some crazy gas well scheme, buying a lot of gold when it happened to top out and then go down, being sold a crazy high fee annuity and losing a bunch of other money invested with the same person.

I would say cross your fingers, don't do anything stupid with your money, know how much you spend and how much you have and hope for the best is about all you can do or you'll drive yourself crazy.
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Old 04-21-2011, 07:43 AM   #8
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All of the above makes sense and you should keep it in mind.
We just retired this past month, but have been living on the "retirement budget" comfortably for the past 4 years.
Our comfort retiring was that regardless of which calculator we used (and it was darn near everyone we could find) they all said good to go.
Having a really good handle on retirement expenses is critical.

Our biggest variable was and is taxes for the long term. They are down now, but will go up when we get to SS, and probably again when minimum IRA distributions hit. And we do not know what the taxes will look like then. Regardless, we will be able to deal with it.

When (it will happen at some point) the market takes a sharp drop, I suppose we will worry a bit. But we beleive that if we stay on plan, we will be OK. We have also chosen to keep 2 years living expenses, plus some emergency expense money liquid.
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Old 04-21-2011, 05:39 PM   #9
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I did not use firecalc as a benchmark of how I am doing on an ongoing basis. I used it as a go/no go indicator.

Trying to get to the crux of your question, I think you want to know how to ensure that you will have the continuing means to finance your retirement forever.

Here is what I (personally, ymmv) have learned in the 4 years of FIRE.
1) the economic crisis was absolutely the worse thing that could have happened as I entered FIRE. I discussed this with a number of people before I had FIREd and had mentioned the worse case scenario and this was it (the market 'tubing' right after I FIRE).
The solution that I had up my sleeve (purely by luck, ... I had chosen to FIRE after 30 years (a nice round number) when I could have done so a bit earlier if I only looked at the numbers. I have a huge (the luck part) emergency fund (about 8 years of what I need for a comfortable FIRE (which subsidizes my megacorp pension (non-cola)). I actually don't touch that, since I only needed about a 1% SWR to finance living and traveling expenses.
The moral to the story is to over-engineer (by plan or happenstance) your FIRE funding. Spend a few more years w*rking (I guess)
I believe that at current course and speed, I am actually adding to my portfolio
2) continue to LBYM. I am sure that this is second nature to most on this board anyway.
3) watch your property taxes if you are in a high tax area and your medical insurance costs (these are my highest (percentage wise) single expenditures). If you can control these, you will do ok.
4) keep yourself healthy. Getting sick or injured will put your FIRE in bad shape, both economically and lifestyle wise. so get enough sleep and eat healthier and exercise (I am trying to get to number 3 myself).

There are a bunch of other nitty things, but I think the above should get you through 90% of what you should be focusing on.

... I'm lov'ng it.
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Old 04-21-2011, 05:46 PM   #10
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Quote:
Originally Posted by palomalou View Post
Since I know many run the retirement calculators that draw me like a bee to a flower, have you found that your results from Firecalc, orp, Merrill edge, for example, have proven pretty reliable in actual life? And if so, for how long have you been retired and looking at these figures? Thanks!
I have been retired for only 17 months, and I don't know. Actually I guess I will never know because I don't spend as much as FIRECalc says I could spend. If the market crashes again, I would probably ramp back my spending even further.

I do think that FIRECalc is a bit generous for my tastes, but then I have a very cautious nature. On the other hand, I am pleasantly surprised with how well my nestegg has done during the strengthening economy since my retirement.
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Old 04-22-2011, 07:48 PM   #11
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Since I know many run the retirement calculators that draw me like a bee to a flower, have you found that your results from Firecalc, orp, Merrill edge, for example, have proven pretty reliable in actual life? And if so, for how long have you been retired and looking at these figures? Thanks!
If anything they've been too conservative. Or perhaps we've been excessively conservative in our assumptions.

We've been ER'd for nearly nine years, but I spent the most time with a retirement calculator on the day the stock market re-opened after 9/11. When I was done crunching the numbers, they still worked. A year later (Oct 2002) they were still working. We never got back down to those levels in 2009 so I stopped worrying about it...
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