Join Early Retirement Today
Reply
 
Thread Tools Search this Thread Display Modes
Beware: another cocktail hour post
Old 07-29-2004, 03:48 PM   #21
Thinks s/he gets paid by the post
BUM's Avatar
 
Join Date: Feb 2004
Location: Mid Hudson Valley
Posts: 1,778
Beware: another cocktail hour post

Cut-Throat,

To hijack a phrase "megadittos"! Once out of work, I cant imagine I'll ever work again. Especially doing crossover work. That is charging or getting paid for doing something you love to do. My neighbor is a devoted surfer and recently started selling surfing lessons. I talked to him about it and it seems to work fine for him... no judgements here.

But for me pleasure and work are mutually exclusive. The further apart the better. Makes for an better prespective.

However if facing starvation, I could work. :P


BUM
__________________

__________________
In a panamax down by the river.
BUM 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!

Re: Safety Margins
Old 07-29-2004, 04:26 PM   #22
 
Posts: n/a
Re: Safety Margins

Re. "megadittos", Rush Limbaugh is a guy who has faced a lot of trouble. He promised to be
"host for life". I hope he keeps his promise but I
doubt it. The guy has already gone through several
firings (including the ESPN fiasco), rapid onset total deafness,
drug dependency, and now a divorce. I've got to tell
you, I wouldn't blame him if he took his bazzillion
dollars and played golf.

John Galt
__________________
  Reply With Quote
Re: Safety Margins
Old 07-29-2004, 04:31 PM   #23
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
cute fuzzy bunny's Avatar
 
Join Date: Dec 2003
Location: Losing my whump
Posts: 22,697
Re: Safety Margins

Eh, I'd go back to work if this sitting around all day stuff became too monotonous, I started running out of money, or the economy fell in a very deep hole.

I wouldnt like it at first, but I'd bet in a few months I'd be plugging away like before.
__________________
Be fearful when others are greedy, and greedy when others are fearful. Just another form of "buy low, sell high" for those who have trouble with things. This rule is not universal. Do not buy a 1973 Pinto because everyone else is afraid of it.
cute fuzzy bunny is offline   Reply With Quote
Re: Safety Margins
Old 07-29-2004, 04:55 PM   #24
Thinks s/he gets paid by the post
Hyperborea's Avatar
 
Join Date: Sep 2002
Location: Silicon Valley
Posts: 1,008
Re: Safety Margins

Quote:
Eh, I'd go back to work if this sitting around all day stuff became too monotonous, I started running out of money, or the economy fell in a very deep hole.
This was exactly my point. The go back to work fall backs are at the bottom of my list. If however, my portfolio dropped to half the year after I retired then I would be looking at some contract work to pay the current bills and leave the portfolio alone or maybe even add to it. If it was 10 years after retirement and I took a hit of 20% I would probably just tighten the budget, do some reallocation, and perhaps live off the fixed income portion for a year or so. Most of that in fact would be taken care of by the fixed+variable system.
__________________
Hyperborea is offline   Reply With Quote
Re: Safety Margins
Old 07-30-2004, 06:50 AM   #25
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
 
Join Date: Jul 2003
Location: Kansas City
Posts: 7,408
Re: Safety Margins

If my portfolio fell by half, I'd salute the Norwegian widow, reread page 108, on Mr Market in my Ben Graham, check the SEC yield of my portfolio (should take 5- 10 minutes) and get back to ER. I suffer from the illusion, a 50-60% drop in the S&P 500 should be 'a planned possible event' in todays market environment. Bernstein, Bogle, or Ben Graham - take your pick - they understand 'Markets Fluctuate'.
__________________
unclemick is offline   Reply With Quote
Re: Safety Margins
Old 08-02-2004, 10:54 AM   #26
Thinks s/he gets paid by the post
Hyperborea's Avatar
 
Join Date: Sep 2002
Location: Silicon Valley
Posts: 1,008
Re: Safety Margins

Quote:
If my portfolio fell by half, I'd salute the Norwegian widow, reread page 108, on Mr Market in my Ben Graham, check the SEC yield of my portfolio (should take 5- 10 minutes) and get back to ER. I suffer from the illusion, a 50-60% drop in the S&P 500 should be 'a planned possible event' in todays market environment. Bernstein, Bogle, or Ben Graham - take your pick - they understand 'Markets Fluctuate'.
Sure, if the S&P500-like portion of my portfolio fell by 50% I wouldn't be too concerned. But if my total portfolio dropped by 50% I would be worried. That portfolio in retirement will be something like:
  • 20% Fixed Income (CDs, short term government bonds, etc)
  • 80% Equity - widely diversified perhaps such as:
    • 10% Total US market - Wilshire 5000
    • 10% Large US Value
    • 10% Small US Value
    • 20% EAFE
    • 10% Emerging Markets
    • 5% REITs
    • 5% Precious Metals
    • 5% Timber
    • 5% High Yield Bonds
Such a large drop in the first year of FIRE with such a highly diversified portfolio would be a large danger sign in my opinion. If it happened then I would think that it would be highly advisable to stop sucking money from it and make some more while my skills were still reasonably fresh and able to bring in more money.

If I waited just a couple of years to "see what happens" then two bad things happen. First, my skills get older and less able to bring in good remuneration. Second, the continued draw from the portfolio increases the odds of failure. It's quite interesting to play with portfolio failure and see that failures can often be turned into winners with some early corrective action.
__________________
Hyperborea is offline   Reply With Quote
Re: Safety Margins
Old 08-02-2004, 11:22 AM   #27
 
Posts: n/a
Re: Safety Margins

Wow, now that's diversification!

In my case, for purposes of illustration let's say
I have 50% in real estate and 50% in bonds/bond funds.
Actually this is pretty accurate. Now, let's assume
I lost 100% of the bonds. Wiped out. I still would
not have to return to work. I would simply sell one of our two (2) residences (or rent it out full time), reverse
mortgage the other one, and draw my SS. It wouldn't be
the ER I had planned for, but it would still be
a good life. Keepin' the wife working a while wouldn't hurt either

John Galt
__________________
  Reply With Quote
Re: Safety Margins
Old 08-09-2004, 05:52 PM   #28
Thinks s/he gets paid by the post
 
Join Date: Mar 2004
Posts: 1,318
Re: Safety Margins

Hanging on to a thread of work life through some part- time work could be an important long-run lifestyle life-preserver for ER couples, living on earnings from assets, who go through a divorce somewhere down the road and find themselves without nearly the income they started ER with. Again, those with personal pensions may not have to worry about this as much, but those with assets that get split in half (or perhaps you are the part of the couple that receives less than half of the assets!) may appreciate having kept a little something going on the work front.

It seems to me that if we are really planning long term, then we have to think about things like that.

(based on the assumption that 1/2 of a couple's income is not enough to live the same lifestyle as a single)

ESRBob
__________________
ER for 10 years; living off 4.3% of savings (and a few book royalties ;-)
ESRBob is offline   Reply With Quote
Re: Safety Margins
Old 08-09-2004, 06:07 PM   #29
 
Posts: n/a
Re: Safety Margins

[quote] (based on the assumption that 1/2 of a couple's income is not enough to live the same lifestyle as a single)

There's an old saying: Two can live as cheaply as each one
separately added together.

Able to leap over tall building in two, sometimes three, bounds
__________________
  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
RV buying and safety guide -- anyone used this? Caroline FIRE and Money 4 12-14-2006 06:43 AM
Safe or Safety Deposit Box? kz Other topics 12 07-13-2006 08:19 PM
Safety of HSA Funds in Vanguard TromboneAl FIRE and Money 1 03-12-2006 07:09 AM
Safety Deposit Box becca FIRE and Money 17 12-02-2005 12:11 PM
Safety Net Sharp21 Young Dreamers 4 01-23-2005 10:00 AM

 

 
All times are GMT -6. The time now is 07:23 AM.
 
Powered by vBulletin® Version 3.8.8 Beta 1
Copyright ©2000 - 2017, vBulletin Solutions, Inc.