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View Poll Results: What percentage of your expenses in retirement are funded by a Pension?
0% - No Pension 55 52.88%
1-25% 14 13.46%
26-50% 14 13.46%
51-75% 6 5.77%
More than 76% 15 14.42%
Voters: 104. You may not vote on this poll

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Re: Source of FIRE Funding
Old 12-04-2006, 11:31 PM   #21
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Re: Source of FIRE Funding

I expect most of my needs will be paid for by the penison even though medical is not paid. But that fact has not kept me from saving like crazy over the last several years to provide an alternative source of income if needed.
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Re: Source of FIRE Funding
Old 12-04-2006, 11:47 PM   #22
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Re: Source of FIRE Funding

I am very suprised by the poll, assuming it is not self-selected. It is exactly the opposite of the results I expected.
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Re: Source of FIRE Funding
Old 12-04-2006, 11:56 PM   #23
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Re: Source of FIRE Funding

not FIRE'd yet, but when I do, it will be without a pension.
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Re: Source of FIRE Funding
Old 12-05-2006, 07:07 AM   #24
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Re: Source of FIRE Funding

Quote:
Originally Posted by bbuzzard
I am very suprised by the poll, assuming it is not self-selected. It is exactly the opposite of the results I expected.
I see a fair number of posts from people with government pensions (including me) but it never struck me that they predominate. The board may actually self-select the other way. People with good, inflation protected pensions have less to worry/plan about financially and may not seek out a forum like this. People who have to DIY gravitate to a forum that can help them validate their planning.
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Re: Source of FIRE Funding
Old 12-05-2006, 07:22 AM   #25
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Re: Source of FIRE Funding

Don't know how your poll would account for this type of funding but I rolled my pension lump sum along with a 401K into an IRA. Which I have yet to tap.
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Re: Source of FIRE Funding
Old 12-05-2006, 07:58 AM   #26
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Re: Source of FIRE Funding

Although there are lots of ways to skin the cat, I agree with Finance Dude that starting and selling your own small biz is a good way to kick start ER -- worked for me anyway. No pension, but SS will be there eventually in some part (assume all here are ignoring that when we say we have no pension) and IRA/401ks are just part of savings in my definition. I guess to be clear the poll is about people getting a defined benefit pension?
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Re: Source of FIRE Funding
Old 12-05-2006, 08:37 AM   #27
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Re: Source of FIRE Funding

Quote:
If I had had to start, run, and sell a successful business in order to retire I would have been miserable and probably would never have made it.
Once read 9 out of 10 don't make it (and fail within 2 years).
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Re: Source of FIRE Funding
Old 12-05-2006, 08:45 AM   #28
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Re: Source of FIRE Funding

Quote:
Originally Posted by tryan
Once read 9 out of 10 don't make it (and fail within 2 years).
Tis true, 9 out of ten small businesses do fail (although I think it is within 5 years).
However, I would say 0 out of 10 'successful businesses' fail (which is what you quoted ).

It isn't easy, but people that are good at it tend to enjoy the process.
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Re: Source of FIRE Funding
Old 12-05-2006, 09:08 AM   #29
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Re: Source of FIRE Funding

You don't have to start and run your own business. If you are one of the early employees in a growing business it can pay off just as well. It's more risky than being an employee in an established business, but it can be far more financially rewarding (if the company management is willing to share).

Audrey
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Re: Source of FIRE Funding
Old 12-05-2006, 02:56 PM   #30
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Re: Source of FIRE Funding

Way more than 76% of my expenses will be covered by my gov't DB pension w/ COLA.

My pension after taxes, ins premiums, and etc., will be ~84% of my net pay now. I live on far less than my net currently, and invest the rest. After FIRE I will continue on that same road. Plus I will actually have more money to play around with, since I won't have to pay costs related to commuting to/from w**k, and eating lunch out 5 days a week!!!

Life IS Good!!!
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Re: Source of FIRE Funding
Old 12-05-2006, 07:30 PM   #31
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Re: Source of FIRE Funding

Quote:
Originally Posted by sgeeeee
I'm retired at age 52 (DW at age 51). DW and I are both vested in small pensions, but will not be eligible to receive any benefits until age 55 (for half benefits) or age 62+ (for full benefits). Since the pension benfits are not COLA'd, the percentage of our annual cash draw that they represent falls every year. So today, the answer is 0% of our annual spending comes from pensions and it will remain that way for 3 to 13 years depending on when we decide to take it.

Based on some reasonable assumptions about spending and inflation, the pensions may contribute about 30% of our cash flow requirements the first year we begin taking benefits.

Based on similar assumptions and the assumption that I live to age 88 (from longevity tables), The pensions may contribute about 15% of my overall retirement cash flow over my lifetime.

I am going to be in a similar situation, and I am very interested in your details. I am currently 46, but thinking of ER or semi-ER. I would withdrawl a little more than the 4% SWD until pension kicks in at 53, 55 or 62, depending upon situation. I was wondering if you have any hybrid models that address this.
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Re: Source of FIRE Funding
Old 12-05-2006, 11:14 PM   #32
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Re: Source of FIRE Funding

Quote:
Originally Posted by 48Fire
I am going to be in a similar situation, and I am very interested in your details. I am currently 46, but thinking of ER or semi-ER. I would withdrawl a little more than the 4% SWD until pension kicks in at 53, 55 or 62, depending upon situation. I was wondering if you have any hybrid models that address this.
FIRECalc (in the original form) actually allows you to model this situation fairly completely. Non-COLA'd pensions can be started on a particular date by entering the pension amount and checking the box that does not inflation adjust.

I also have a collection of spreadsheets and calculations. You can convert a fixed pension amount to a present value using an annuity calculator. (check out Section 5.4 at http://www.golio.net/My_Homepage_Files/Page13.html to get access to some online calculators). Then make appropriate assumptions about earning rate between today and the start date of your benefits. Add that amount to your present net worth and apply the 4% rule.
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Re: Source of FIRE Funding
Old 12-05-2006, 11:25 PM   #33
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Re: Source of FIRE Funding

A majority of our members apparently have no pension.

A lot of true grit here, to get to FIRE completely on your own.

Ha
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Re: Source of FIRE Funding
Old 12-06-2006, 05:41 AM   #34
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Re: Source of FIRE Funding

Thanks, sgeeeee. I will take a look at it, and get back with any more questions.
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Re: Source of FIRE Funding
Old 12-06-2006, 10:29 AM   #35
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Re: Source of FIRE Funding

Quote:
Originally Posted by HaHa
A majority of our members apparently have no pension.

A lot of true grit here, to get to FIRE completely on your own.

Ha
I've been thinking a bit about this statement. My FIRE will be a combination of a partially (and somewhat imperfectly) COLA'd pension plus investments. The pension will figure in more early, the investments more later. I find I have much more insecurity about the pension portion.

I have no control over the pension. Corporate and political agencies are finding ways in droves to slime out on pension obligations. Alternatively, If I could have kept my contribution and the employer's contibution (you know, that part they were supposed to make, but didn't) and been allowed to invest it, I'd feel much better. if I had the option for a lump-sum payout, I'd take it in a heartbeat, but unfortunately, I would get next to nothing for it (only the employees contributions with 3% interest). I guess it's all about where you perceive the risks to be.

So my question to all those out there envying pensions--who is in better shape--who's really more secure? And who needs the most "true grit." If you are planning on a pension, have you considered if your pension is not fully COLA'd, how will your retirement fare in a round of 70s-style inflation?

I don't know the answer. I'm probably a control freak, which is why depending on a pension makes me very nervous. I'm considering taking an accelerated payout which will leave my investments alone longer and take the pension money up front. But there are other issues with that, not the least of which is there is no joint survivor option if I do that, so I'd need to look into term life.
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Re: Source of FIRE Funding
Old 12-06-2006, 12:31 PM   #36
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Re: Source of FIRE Funding

I didn't vote since DH hasn't quit yet, so we're still living off of his income, but once he quits that's it - we're on our own, no pension.
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