Join Early Retirement Today
Reply
 
Thread Tools Search this Thread Display Modes
Old 12-04-2009, 09:26 AM   #21
Moderator
Alan's Avatar
 
Join Date: Jul 2005
Location: Eee Bah Gum
Posts: 21,091
Quote:
Originally Posted by donheff View Post
I am planning to start something similar in January (DW retires this year). I will pull the years funds at one time and move them to another account where I will pull monthly for the year's expenses. Left over money (if any) will get rolled into a mad money/emergency fund. Like R-I-T I plan a Clyatt style variable rate.
To be more specific about my plans, I will calculate the amount based on the Jan 1st balance - say it is $36k for the coming year. I will then move it into my spending account once a quarter, since that is when Wellesley spits out it's dividends. If my Wellesley account pays out $5k end of a quarter then I will add $4k to it from my RE cash accounts.

Since this is my first year coming up I am only speaking about my plan, I have no experience at this yet but it sounds simple and I like simple

PS - if the amount "planned" is greater than 4% then I will only withdraw 4% and cut spending that coming year
__________________

__________________
Retired in Jan, 2010 at 55, moved to England in May 2016
Now it's adventure before dementia
Alan 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 12-04-2009, 09:51 AM   #22
Thinks s/he gets paid by the post
Rustic23's Avatar
 
Join Date: Dec 2005
Location: Lake Livingston, Tx
Posts: 3,624
This seems a little like the 'measure with a micrometer and cut it with a meat ax' discussion. First one of those disclosures, 'I don't depend on SWR for retirement.' However, I do have IRA's and such and do want to know what I can draw out and have them last my entire retirement.

Having said that, and reading much about the SWR on this board and other placed, it is just not that accurate of a forecast. If I understand it, which may be the problem, it is initial amount and rate you can withdraw from your savings increasing each year for inflation. If this amount is set for the initial withdrawal then the amount is key not necessarily the rate for future withdrawals. I know many on this board manage the rate depending on what their portfolio does, however, IMHO, in those cases you are not really using a SWR, and that makes perfectly good since. Running out of cash at 89 is not a option for most of us.

If the SWR is truly a valid number, then it should not make any difference when you calculate it. It has never made since to me that an investor that retires on Jan 1 with 1,000,000 can withdraw 40,000, however, if he retires one year later with 500,000, he can only withdraw 20,000. According to SWR theory he will withdraw 40,000 plus inflation from his 500,000 portfolio in his second year. If the reason for his portfolio drop is 'economic' i.e. he did not take out 500,000 to purchase something or such, then it seems to me he is in the same place the second year.
__________________

__________________
If it is after 5:00 when I post I reserve the right to disavow anything I posted.
Rustic23 is offline   Reply With Quote
Old 12-04-2009, 10:25 AM   #23
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
Moemg's Avatar
 
Join Date: Jan 2007
Location: Sarasota,fl.
Posts: 10,032
Quote:
Originally Posted by Rustic23 View Post
.

If the SWR is truly a valid number, then it should not make any difference when you calculate it. It has never made since to me that an investor that retires on Jan 1 with 1,000,000 can withdraw 40,000, however, if he retires one year later with 500,000, he can only withdraw 20,000. According to SWR theory he will withdraw 40,000 plus inflation from his 500,000 portfolio in his second year. If the reason for his portfolio drop is 'economic' i.e. he did not take out 500,000 to purchase something or such, then it seems to me he is in the same place the second year.

That is what happened (maybe not as drastic a drop ) to a lot of us that retired just as the market melt down started . By the time Jan. 2009 rolled around my portfolio had taken a major hit so I did take a cut . It was not drastic as I still had my pension and SS survivor benefit but it was a cut of several thousand dollars . Luckily I had a lot of padding so it was not too painful . I just did not feel comfortable taking my amount from 2008 and giving myself a raise when the meltdown was still occurring . Plus leaving that money in the market helped me get back a lot of my losses .
So I feel the SWR and the way you calculate it is emotional as well as financial .
__________________
Moemg is offline   Reply With Quote
Old 12-04-2009, 08:27 PM   #24
Recycles dryer sheets
 
Join Date: Oct 2007
Posts: 332
The Journal of Financial Planning is going to have this article in the Jan. 2010 issue. It is a subject I have been considering. It will probably be worth a read- "Achieving Sustainable Retirement Withdrawals: A Combined Equity and Annuity Approach".
__________________

__________________
cashflo2u2 is offline   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
What is your withdrawal rate ? Moemg FIRE and Money 50 12-18-2007 01:57 PM
Rookie Social Security question emi guy FIRE and Money 7 09-25-2007 04:55 PM
Calculating FIRE date / portfolio (newbie question) Webzter Young Dreamers 7 07-02-2007 12:17 PM
Another safe withdrawal rate question arandomwalk07 FIRE and Money 52 04-04-2007 10:46 AM
A simple withdrawal rate question Roger_R FIRE and Money 7 03-07-2007 04:30 AM

 

 
All times are GMT -6. The time now is 03:05 PM.
 
Powered by vBulletin® Version 3.8.8 Beta 1
Copyright ©2000 - 2017, vBulletin Solutions, Inc.