Join Early Retirement Today
Reply
 
Thread Tools Search this Thread Display Modes
Old 05-05-2015, 10:52 PM   #41
Thinks s/he gets paid by the post
 
Join Date: Sep 2012
Location: Seattle
Posts: 2,906
Is it really surprising that 20% of people 85+ die with no or little assets? It is quite likely most of those people spent a few of the last years in LTC which from stories on here can reach $100k or higher per year.

I am actually surprised only 20% died with little assets.
__________________

__________________
Fermion is offline   Reply With Quote
Join the #1 Early Retirement and Financial Independence Forum Today - It's Totally Free!

Are you planning to be financially independent as early as possible so you can live life on your own terms? Discuss successful investing strategies, asset allocation models, tax strategies and other related topics in our online forum community. Our members range from young folks just starting their journey to financial independence, military retirees and even multimillionaires. No matter where you fit in you'll find that Early-Retirement.org is a great community to join. Best of all it's totally FREE!

You are currently viewing our boards as a guest so you have limited access to our community. Please take the time to register and you will gain a lot of great new features including; the ability to participate in discussions, network with our members, see fewer ads, upload photographs, create a retirement blog, send private messages and so much, much more!

Old 05-06-2015, 12:43 AM   #42
Thinks s/he gets paid by the post
 
Join Date: Jun 2014
Posts: 1,035
Agreed, shocked it was only 20-30 percent. They didn't even have the interwebcloud to help them.


Sent from my iPhone using Early Retirement Forum
__________________

__________________
dallas27 is offline   Reply With Quote
Old 05-06-2015, 06:30 PM   #43
Recycles dryer sheets
Rothman's Avatar
 
Join Date: Apr 2013
Posts: 249
I think the percentage with no assets is probably highly correlated to those with medical conditions or in long term care. The system today depletes assets fast and government supports comes only after assets are depleted.


Sent from my iPad using Early Retirement Forum
__________________
Rothman is offline   Reply With Quote
Old 05-06-2015, 08:24 PM   #44
Thinks s/he gets paid by the post
 
Join Date: Oct 2012
Location: Colorado Mountains
Posts: 2,146
Quote:
Originally Posted by GravitySucks View Post
All you need to do is live in a tent for two years and South America for a couple other years.
I'd rather get another job than live in a tent.

Sent from my Nexus 7 using Early Retirement Forum mobile app
I lived in a tent on 3-week visits out here in the Colorado mountains before I retired. It wasn't so bad. Glad it wasn't this year, though. With all the spring snow we've had, the tent probably would have collapsed!
__________________
Hermit is offline   Reply With Quote
Old 05-06-2015, 11:02 PM   #45
Full time employment: Posting here.
GravitySucks's Avatar
 
Join Date: Feb 2014
Location: Syracuse
Posts: 994
Quote:
Originally Posted by Hermit View Post
I lived in a tent on 3-week visits out here in the Colorado mountains before I retired. It wasn't so bad. Glad it wasn't this year, though. With all the spring snow we've had, the tent probably would have collapsed!
Since retiring I've spent a month plus living in a 30 year old Toyota Mini Motorhome and two weeks sleeping mostly on a train in the coach seats. Plus some generous couch surfing time.

Tenting for two years would be beyond the pale though. I stand by the going to a part time job instead statement. 😀
__________________
“No, not rich. I am a poor man with money, which is not the same thing"
GravitySucks is offline   Reply With Quote
Old 05-30-2015, 04:13 PM   #46
Recycles dryer sheets
 
Join Date: Aug 2013
Posts: 349
Quote:
Originally Posted by Running_Man View Post
These carefree yes you can retire with 80 - 100 percent stock portfolios presented as see you can survive the worst times are absurd, the article has the following problem:

1) How was this mythical person invested? In non-existent low cost ETF's? Per John Bogle in 1965 only 5.7% of equities were owned by funds and most of those funds were blends of stocks and bonds. Pure equity plays were almost impossible to find.

2) in 1975 when they cut their spending to 2.5% of the original portfolio amount, at that point the 40K withdrawal should have been $69,418 with inflation, they are going to live on 25K? The chart implies about 18K on an inflation adjusted basis but that does not match with the article statement. That 2,5% of original portfolio is equivalent to $15,716 in 1965 or in other words changed to a 1.5% withdrawal rate! Hey you can retire with 4% withdrawals, all you need is flexibility to live on 1/3 of that amount.

3) In the middle of this in 1970's they consider a part time minimum wage job to make $500 a month after tax. Minimum wage in 1977 is $2.30 so they are going to need to work 217 hours without considering taxes to make $500 per month. This is 54 hours per week. But hey no, let's just move to Brazil for a couple of years it'll be great there and we'll save a fortune so we go!.

4) The article implies you live off an average of 3.75% over the lifetime of 50 years with a little flexibility - really what is written calls for psychic powers. Despite a belief in 4% withdrawals you know enough to start at 3% and average a 2.5% withdrawal during the early bad years and are able to drop that to 1.5% 10 years in and at the all time low in stocks you go 100% stocks invest at the absolute bottom. Then when portfolio is just starting to recover you go to 4% of original portfolio, 8% withdrawal of the actual portfolio why not!, right when the market makes a huge multi-year greatest bull run ever, which helps because otherwise that withdrawal rate would have failed for sure.

This psychic ability is necessary since if you started at 4 per cent withdrawals and dropped to 3% as the portfolio fell and invested in the mutual funds available at the time you would be a 50 year old bankrupted individual in 1980 otherwise, right when unemployment is set to be at an all time high. Of course at age 50 with no retirement savings, you would be no worse off than over 50% of all 50 year olds.

This obvious rip-off of the Mr Money Mustache the world is all sunshine blog and 100% stocks always works out if you keep a good attitude and are willing to ride a bike is dangerous to financial planning. Of course the income from the blog from people wishing to be able to stop working at age 35 means the writer never has to worry about living on stocks, he's got blogging income!
__________________
aim-high is offline   Reply With Quote
Old 06-01-2015, 09:48 AM   #47
Dryer sheet wannabe
 
Join Date: Mar 2012
Posts: 17
Quote:
Originally Posted by Bestwifeever View Post
Bloggers. I also read the comments to the link, most made by other bloggers. I wonder how many of their commenters/readers are bloggers. I bow to whoever created the blogosphere.

He links to another article of his about how the 4 percent annual withdrawal for 50 years is supported, but that article of course is all about the 30 year period, not 50. I think we need a blog entry about how you can take 4 percent from birth.
From this thread (and others) it seems that the common wisdom around here is contrary to MMM and other bloggers whose common wisdom is that 4% is just fine, even for 50 years. So what is the mindset here? 3% 2%?
__________________
1979dreamer is offline   Reply With Quote
Old 06-01-2015, 11:35 AM   #48
Administrator
W2R's Avatar
 
Join Date: Jan 2007
Location: New Orleans
Posts: 38,939
Quote:
Originally Posted by 1979dreamer View Post
From this thread (and others) it seems that the common wisdom around here is contrary to MMM and other bloggers whose common wisdom is that 4% is just fine, even for 50 years. So what is the mindset here? 3% 2%?
For other people, I would think probably 3% for a 50 year retirement.

For myself - - well, I think everyone here would agree that I am cautious about money, perhaps overly cautious. So far in retirement I have been spending around 2%, but I am taking steps to increase my spending from now on because you can't take it with you. I am 66 so I think 3.5% is a better spending level for me.
__________________
Already we are boldly launched upon the deep; but soon we shall be lost in its unshored, harbourless immensities.

- - H. Melville, 1851
W2R is offline   Reply With Quote
Old 06-01-2015, 12:12 PM   #49
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
pb4uski's Avatar
 
Join Date: Nov 2010
Location: Vermont & Sarasota, FL
Posts: 16,477
Quote:
Originally Posted by 1979dreamer View Post
From this thread (and others) it seems that the common wisdom around here is contrary to MMM and other bloggers whose common wisdom is that 4% is just fine, even for 50 years. So what is the mindset here? 3% 2%?
4% can be close to ok if you have SS or a pension that replaces a good portion of your spending needs.

For example, take firecalc and a 50 year old single with $1 million in assets and $40k living expenses, 60/40 portfolio and the remaining assumptions defaults. Success ratio is 73.7%.

Now assume that SS replaces 25% of living expenses ($10k in current $) beginning at age 66 and the success ratio increases to 91.6%.

Now assume that instead the person waits until age 70 and receives $13.2k (132%, 8% increase for 4 years) and the success ratio is still 91.6%.

So SS can have a significant impact on a sustainable withdrawal ratio. For me, I would want 98% success which implies a 3.75% WR with SS covering 25% of living expenses ($10k in the scenario above), so it isn't a lot lower than 4%.
__________________
If something cannot endure laughter.... it cannot endure.
Patience is the art of concealing your impatience.
Slow and steady wins the race.
pb4uski is online now   Reply With Quote
Old 06-01-2015, 12:14 PM   #50
Thinks s/he gets paid by the post
2017ish's Avatar
 
Join Date: Apr 2012
Posts: 1,848
Quote:
Originally Posted by 1979dreamer View Post
From this thread (and others) it seems that the common wisdom around here is contrary to MMM and other bloggers whose common wisdom is that 4% is just fine, even for 50 years. So what is the mindset here? 3% 2%?
I don't know that there is a particular mindset--other than that many (most) feel that the "traditional" lockstep 4% every year is likely a risky way to go when you are planning a 40-50 year retirement in the current environment for Stocks/Bonds. 3% is probably common.

OTOH, we plan to work until 3% would let us travel more/better than we have to date, and 1% would let us live reasonably well without travel. But leaning toward a withdrawal "strategy" of 4.5-5% of the previous year end portfolio value; indeed, in the early years, it may even be 1.1-1.25% of the previous quarter's ending value. This will be a roller coaster, but given that the vast majority of our spending will be discretionary....

VPW (Variable Percentage Withdrawal) is also a noteworthy approach, and there are many others.
__________________
OMY * 3 2ish Done 7.28.17
2017ish is offline   Reply With Quote
Old 06-01-2015, 01:12 PM   #51
Thinks s/he gets paid by the post
 
Join Date: Feb 2007
Posts: 1,906
Quote:
Originally Posted by pb4uski View Post
4% can be close to ok if you have SS or a pension that replaces a good portion of your spending needs.

For example, take firecalc and a 50 year old single with $1 million in assets and $40k living expenses, 60/40 portfolio and the remaining assumptions defaults. Success ratio is 73.7%.

Now assume that SS replaces 25% of living expenses ($10k in current $) beginning at age 66 and the success ratio increases to 91.6%.

Now assume that instead the person waits until age 70 and receives $13.2k (132%, 8% increase for 4 years) and the success ratio is still 91.6%.

So SS can have a significant impact on a sustainable withdrawal ratio. For me, I would want 98% success which implies a 3.75% WR with SS covering 25% of living expenses ($10k in the scenario above), so it isn't a lot lower than 4%.
Or 92.6% success ratio if SS is started at 62. I guess in this simple scenario it does pay to start SS early (per Firecalc anyway)
__________________
ejman is online now   Reply With Quote
Old 06-01-2015, 02:06 PM   #52
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
haha's Avatar
 
Join Date: Apr 2003
Location: Hooverville
Posts: 22,387
Quote:
Originally Posted by pb4uski View Post
4% can be close to ok if you have SS or a pension that replaces a good portion of your spending needs.
Sure, as is amply proven by those retirees with essentially no savings, What counts is not savings, but cash flow and its reliability.

Ha
__________________

__________________
"As a general rule, the more dangerous or inappropriate a conversation, the more interesting it is."-Scott Adams
haha is online now   Reply With Quote
Reply


Currently Active Users Viewing This Thread: 1 (0 members and 1 guests)
 
Thread Tools Search this Thread
Search this Thread:

Advanced Search
Display Modes

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is Off
Trackbacks are Off
Pingbacks are Off
Refbacks are Off


Similar Threads
Thread Thread Starter Forum Replies Last Post
Best Time / Worst Time to rollover 401(k) Looking4Ward FIRE and Money 19 09-22-2014 12:38 PM
Your worst moments / worst failures? Nords Other topics 28 07-13-2007 12:03 AM
How Would You Have Done In 1965? Donner Other topics 64 06-01-2005 02:42 PM
Worst Jobs Ever cute fuzzy bunny Other topics 2 03-22-2005 07:17 AM
Doom and gloom SWR based on 1965-1982 amt FIRE and Money 81 07-26-2004 05:49 AM

 

 
All times are GMT -6. The time now is 05:34 PM.
 
Powered by vBulletin® Version 3.8.8 Beta 1
Copyright ©2000 - 2017, vBulletin Solutions, Inc.