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Running out of money?
Old 01-02-2017, 12:16 PM   #1
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Running out of money?

With all our discussion here about withdrawal strategies, returns, AA's and such, has anyone run out of money or known someone who has or nearly has? I am assuming people take action as they see the inevitable and ward off disaster. I wonder sometimes if we worry too much or if the threat is truly real.
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Old 01-02-2017, 12:21 PM   #2
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I've been a member of this forum for over 10 years, and I remember a couple of people who were running scared around 2008-9 and disappeared. In a self selected group, there is likely to be a bias towards successful people.
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Old 01-02-2017, 12:27 PM   #3
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I've been a member of this forum for over 10 years, and I remember a couple of people who were running scared around 2008-9 and disappeared. In a self selected group, there is likely to be a bias towards successful people.
+1

I go with the supposition that the most folks here, they keep an eye out on the finances and would make necessary adjustments long before they crashed and burned.

now of course we could play the "what would happened" game for ever but all that would get us is ulcers.

Actually I did know one person who hit the progressive slots in a casino at A/C and within 5 years was broke but as with a lot of lottery winning stories, this person was horrible with money prior to wining.
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Old 01-02-2017, 12:39 PM   #4
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I've been a member of this forum for over 10 years, and I remember a couple of people who were running scared around 2008-9 and disappeared. In a self selected group, there is likely to be a bias towards successful people.
+1

Some did make posts worrying about money and talking about doing a side job, before disappearing.

Even more disturbing to me are a number of posters who talked about serious health issues, then also disappeared.

I'd rather be among the 1st group, living out my time in an RV on New Mexico state park, than releasing my carbon content back to the world.
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Old 01-02-2017, 12:56 PM   #5
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It almost begs the reverse question... how many saved a bunch of loot and then fast forward 10 yrs from RE you 1) never spent what you thought you would, 2) your portfolio is worth more than it was when you started/or what you expected? Would you have gotten earlier on less if you knew then what you know today?
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Old 01-02-2017, 12:57 PM   #6
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Not me, but one of my DGM's almost ran out of money.

She lived fairly frugally after my DGF died. She owned the house she lived in, then downsized to a condo, then moved into assisted living. It was partially paid for by insurance, but the insurance had recently run out (I believe it covered three years?). She was spending the last of her savings (along with SS).

She would have run out of money in about a year when she died at age 91.

Her safety net was the family. Between myself, siblings, and cousins, we would have stepped up and paid for her care.
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Old 01-02-2017, 01:11 PM   #7
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When talking 4% rule, tracking expenses and all of the other topics (firecalc results) I often wonder why some poster's are so precise and down to the penny with their plans. I feel that if someone is so set on ER and their precise planning why wouldn't they have mutiple back up plans/options? For example if you had a sequence of returns issue, wouldn't you definately have wiggle room/back up plan to deal with it. Who in the right mind would have such a delicate plan that if things barely began to fall out of the left and right lateral limmits wouldn't immediately correct course? "Nope, firecalc said this plan would work so I will ride this Titanic to the bottom". I am not saying some unforeseen issue won't come up (law suit comes to mind). I guess what I am saying is that if my AA slips from 70/30 to 67/33 I don't worry too much. Just rebalance periodically and continue to have fun. I sleep well at night knowing that I have mutiple streams of income and flexability to earn more and cut expenses if need be. Insurance and pensions help the sleep also.

Doubt we would hear too much from members who failed or had help issues causing them to be unsuccesful.

Happy New Year and best of luck to all in 2017.
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Old 01-02-2017, 01:16 PM   #8
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Most retired people I know never had much money to begin with. They have pensions, SS, and/or annuities so they don't need savings. Of course they all live on less than most people here but they all seem happy.
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Old 01-02-2017, 01:18 PM   #9
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When talking 4% rule, tracking expenses and all of the other topics (firecalc results) I often wonder why some poster's are so precise and down to the penny with their plans...
I am not among those. My spending is all over the place over past years.

My plan is to significantly under-spend the FIRECalc number. If I build up a big surplus, I will deal with it later. And then, my backup plan is to live in an RV parked for $200/year fee on New Mexico state land. Can it get worse than that?

I want to free my mind off the money problem, so I can concentrate on my health, if that makes any sense to anybody.
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Old 01-02-2017, 01:18 PM   #10
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It almost begs the reverse question... how many saved a bunch of loot and then fast forward 10 yrs from RE you 1) never spent what you thought you would, 2) your portfolio is worth more than it was when you started/or what you expected? Would you have gotten earlier on less if you knew then what you know today?
I use the car analogy. If my car holds 400 miles of gas and I take a trip going 390 miles do I drive the whole way without refilling? No. Somewhere around 300-350 miles I will stop and top off the tank. Now I do believe that my options for refilling the gas tank (my $ stash) will decrease over time I do have many back up plans in place to cover all foreseen/anticipated issues. At the end of the trip will I have gas left over in the tank? I am sure I will. Not a problem. Unless for some reason I get crazy stupid the last few years of anticipated life my heirs will recive a few bucks or at least a half tank of gas.
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Old 01-02-2017, 01:21 PM   #11
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I am not among those. My spending is all over the place over past years.

My plan is to significantly under-spend the FIRECalc number. If I build up a big surplus, I will deal with it later. And then, my backup plan is to live in an RV parked for $200/year fee on New Mexico state land. Can it get worse than that?

I want to free my mind off the money problem, so I can concentrate on my health, if that makes any sense to anybody.
+1 sort of. This is #3 or #4 if some weird unfrorseen event wipes out plans 1 and 2.
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Old 01-02-2017, 01:30 PM   #12
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I use the car analogy. If my car holds 400 miles of gas and I take a trip going 390 miles do I drive the whole way without refilling? No. Somewhere around 300-350 miles I will stop and top off the tank...
I always keep an eye on the fuel gauge when driving. The MPG varies based on many factors.

When younger, I used to do a lot of day trips to California. Driving the same car with a full tank, starting from Phoenix I usually could get close to LA before having to refuel. I was able to reach Long Beach once.

One time, my tank was alarmingly close to empty when I got to Indio, and I needed to stop for gas. When I got out of the car at the gas station, I understood why. The headwind was blowing so strong that I had to push hard to open the door! I stood leaning 30 degrees into the wind while pumping!

So, one needs to keep an eye on his stash, and starts to cut back his lifestyle before it gets too late, no matter what calculator he uses.
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Old 01-02-2017, 02:21 PM   #13
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Originally Posted by Bigdawg View Post
When talking 4% rule, tracking expenses and all of the other topics (firecalc results) I often wonder why some poster's are so precise and down to the penny with their plans. I feel that if someone is so set on ER and their precise planning why wouldn't they have multiple back up plans/options? For example if you had a sequence of returns issue, wouldn't you definitely have wiggle room/back up plan to deal with it. Who in the right mind would have such a delicate plan that if things barely began to fall out of the left and right lateral limits wouldn't immediately correct course
I agree- I'm averaging just under 4% and haven't filed for SS yet. I track my spending mostly out of curiosity but also to figure out the cost of basic necessities vs. frills. I could cut out a ton in a bad year just by cutting way back on charitable donations and travel.
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Old 01-02-2017, 02:40 PM   #14
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I agree- I'm averaging just under 4% and haven't filed for SS yet. I track my spending mostly out of curiosity but also to figure out the cost of basic necessities vs. frills. I could cut out a ton in a bad year just by cutting way back on charitable donations and travel.
+1

I track my expenses for the same reason. Same as you, I would save a bunch without charity, gift giving, and travel. If I jettison the 2nd home, I will save even more.

Come to think of it, when one has a paid-for home and is on Medicare, has no car payments, just stays home to surf the Web and cooks own meals, what are the expenses? Food is darn cheap, and then old people do not eat that much. Wine bottles under $10 are plenty good. Heck, my favorite wine currently is a box wine.
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Old 01-02-2017, 02:48 PM   #15
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My Mom planned her life that when her $ ran out she could still live fine on her SS and small pension my Dad left. It worked fine for her. She still went out to eat, movies etc but by 80's did not want to travel a lot but did travel some.
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Old 01-02-2017, 02:56 PM   #16
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Out of about 8 people I knew that pulled their pension just before it was locked in at age 50, 2 of them have returned to w*rk because the money didn't last as long as they thought. Had they stayed 5 and 7 years longer, they both would have been entitled to a monthly pension that likely would have been sufficient for their needs.
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Old 01-02-2017, 02:59 PM   #17
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I'm one of those "precise planners". But I also added some fudge in my numbers so it's fuzzy precision Being able to be precise at the start of my planning gave me comfort. Adding the fuzziness made me feel more secure in taking the leap. 18 months in I'm ok. My only concern now is that the market run up has caused me to feel overly secure, however my WR for this (my first full year of ER) is 3% of my initial portfolio. Looking at it in those terms makes me feel better.
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Old 01-02-2017, 03:10 PM   #18
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It almost begs the reverse question... how many saved a bunch of loot and then fast forward 10 yrs from RE you 1) never spent what you thought you would, 2) your portfolio is worth more than it was when you started/or what you expected? Would you have gotten earlier on less if you knew then what you know today?
heh heh heh - predictions is hard especially about the future(sic). My Yogi Berra quote book went in Katrina.

22 years ER. Cheap early, Mr Market was kind, and married at 70 - Wife with porfolio. My crystal ball never worked but
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Old 01-02-2017, 03:17 PM   #19
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That is really sad. That is the reason the government will never let people have a lump sum for SS. Just a bad idea all around.
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Old 01-02-2017, 03:28 PM   #20
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That is really sad. That is the reason the government will never let people have a lump sum for SS. Just a bad idea all around.
What's sad?
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