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Old 04-12-2015, 12:49 PM   #21
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I posted this in the other $880k thread so might as well post it here too. In my case I'm shooting for $1.2MM with a 3.5% SWR (i.e. $42k without SS) and hopefully I can quit before my 50th b.day (10yrs to go but the BS bucket is starting to overflow). My budget is loosely based on what I'm currently spending and what sort of things will be reduced/eliminated (child support, mortgage etc) in the future when I retire:

Mortgage: 0
prop taxes: $2000
utilities: $3500
house up keep, maintenance: $2000
Car/RV insurance/gas/repairs/AAA etc: $8000
Food: $7000
Pets: $1500
Entertainmet: $3000
Healthcare: $2500 (ACA silver plan for 2 adults with $35k income and financial help)
Income taxes 15%: $5500

Total: $35000 (add another $5k for a buffer and I'm at $40k per year and I live in SoCal).
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Old 04-12-2015, 12:50 PM   #22
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Our magic number was lowering our annual expenses to match what we would have in retirement income without any additional earned income.
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Old 04-12-2015, 02:47 PM   #23
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I did not really have a magic number, a goal that I waited to reach before I retired. I did not even seriously entertain the idea of ER.

When I found this forum and saw people talked about 4% WR or less for ER, I started tracking my expenses, and saw that I had enough to maintain the same lifestyle, but needed my children college costs to be behind me. And while waiting for them to finish school, my stash grew some more, and made it easier. And that was how it worked.

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Originally Posted by wingfooted View Post
Net investable wealth > $10MM

I have a shot at it, dependent on equity market performance.
Nice!
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Old 04-12-2015, 05:42 PM   #24
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Once I hit 1.2M I knew I could go at any time. That and a paid for house made me and firecalc happy. I stayed working a bit longer (hoping for a layoff package) but the BS bucket filled up before I got the severance package.
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Old 04-12-2015, 06:21 PM   #25
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My magic number was 25 times expenses- including medical and taxes at retirement; less Social Security at age 62 (the earliest date we would take it) and less the non-cola pension.
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Old 04-12-2015, 07:16 PM   #26
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My magic number was however much I had when I was laid off and realized I didn't feel like going back to work.
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Old 04-12-2015, 07:42 PM   #27
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Never had a magic number. Last I checked I'm at 39x spending and 2.4 or 2.5% WR (includes SS delayed to 70). FIDO, Firecalc, CFIRESIM, ESPlanner, Financial Engines all say 100% success with leftover $ at end of plan. Personally have more confidence with FIDO as the default calculation is based on market returns performing substantially lower than average. Firecalc and CFIRESIM (without adjustments) are much more generous as they rely on historical US data, something I'm not comfortable with.

AFAICT, Pfau has got to be the most conservative forecaster out there, with a 2.5% inflation adjusted WR for 30 years and 90% success rate (given current valuations). Cotton states the range of recommended SWR's from recent literature is 3.2%-3.5%, including VG's recent estimate. Of course these are all just forecasts, but I agree with Cotton that it's best to plan conservatively. A "magic number" could blow up in your face tomorrow (see 2008).
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Old 04-12-2015, 07:50 PM   #28
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There is no magic number.

I thought it was $5m but I got there and did not feel comfortable with that so now I think it must be $10m - but if I hit that, I doubt if I will feel comfortable with that.

Maybe I just like to worry.
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Old 04-12-2015, 11:59 PM   #29
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My magic number (1.6M) quest turned into a ready or not number (1.25M) when I started to suffer from job burnout last year. A heart to heart with my supervisors (funny how they asked me how I was doing after I inquired about some details of my retirement account from HR) resulted in a transfer away from a abusive boss, cut my daily commute in half and reduced my hours somewhat. And my NW has grown 16% (too much company stock) since then. So if Mr. Market can hang it there a little longer I anticipate my "ready or not" number will be just a little short of my goal when I pull the plug, pay off Uncle Sam and fix my desired AA.
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Old 04-13-2015, 12:10 AM   #30
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Originally Posted by daylatedollarshort View Post
There is a term for that - accommodation.

When I first started thinking about ER, I thought that 1.2M was enough but as I got closer I kept pushing up the number. Fortunately I didn't let the increases go on forever and decided to fire once we got to 1.8M


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Old 04-13-2015, 06:35 AM   #31
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I didn't have a magic number. DW had a magic date. So I waited (almost) to the time when she maximized her pension and secured retired health care from her employer.
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Old 04-13-2015, 08:20 AM   #32
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I am a dinosaur and had 2 magic numbers, 55 and 80. To take early retirement with a DB pension and retiree health insurance you had to be at least 55 years of age, and the sum of your age and years of service had to be 80 or higher.

FIRECALC also showed 100% when I hit 55 and 80
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Old 04-13-2015, 08:38 AM   #33
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Quite apparent here that most of us got to a "number" then decided to push the "number" a little more.As i'am presently doing this 1.5 going to 2, I keep reminding myself that the larger number does not equate with health. Just buried a co-worker 2 weeks ago who was 56.Want to make sure I clearly see that side of the equation as I balance net worth/ expenses/age/health
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Old 04-13-2015, 08:39 AM   #34
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My magic number is $2M, at which my wife will retire and we will do extensive travels (I am already semi-retired). If we get to $3M, we will buy business class seats for international travels.
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Old 04-13-2015, 08:42 AM   #35
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Originally Posted by mtheulen View Post
Quite apparent here that most of us got to a "number" then decided to push the "number" a little more.As i'am presently doing this 1.5 going to 2, I keep reminding myself that the larger number does not equate with health. Just buried a co-worker 2 weeks ago who was 56.Want to make sure I clearly see that side of the equation as I balance net worth/ expenses/age/health
Just to take this into account, we have started our "experiencing retirement" phase by doubling our travels, starting this year after my younger son goes to college. There is no need to wait until my magic number is hit. Time is more valuable.
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Old 04-13-2015, 08:44 AM   #36
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My magic number, the number I was watching closely as the final pieces of my ER plan were falling into place in 2007-08, was the exploding value of the company stock in my 401k. When it reached $300k, I knew I could cash it out at favorable tax rates via NUA, then invest it in a bond fund I had been watching for over a year to generate the monthly income I would need to retire on. I already had enough in my other non-retirement investments to (1) cover the taxes on the stock cashout, (2) provide me a decent cushion/surplus, and (3) provide some growth in the portfolio.
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Old 04-13-2015, 08:52 AM   #37
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My number was $2M, but I found out that it wasn't my DW's number. We're at more than 2x that number now, and we're counting down to a date, not a net worth number.
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Old 04-13-2015, 09:10 AM   #38
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Quote:
Originally Posted by W2R View Post
I think that many older members may find that their magic number is/was considerably less than an $880K portfolio (excluding real estate). This would be especially likely for those with a paid off house, no dependents, and living in low COL areas, who have reached SS age and/or have a small pension, and who do not regard expensive international travel as one of their core activities. I fall in that category.

Younger retirees may need more to bridge the gap to SS and/or pension and to last for more than 30 years.
+1

Well said... Retiring in 1989, we didn't think in terms of "magic"... More like, we'll give it a try... In the 1940's, the song was "Coming in on a Wing and a Prayer". (lyrics @ 1:31)



'Course the dollar was a bit different then, $500K in 1989, is $950K today.

Planning for the future is lots easier when your horizon is 10 years out, and not 20, 30 or 40.
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Old 04-13-2015, 09:30 AM   #39
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Originally Posted by Aus_E_Expat View Post
There is no magic number.

I thought it was $5m but I got there and did not feel comfortable with that so now I think it must be $10m - but if I hit that, I doubt if I will feel comfortable with that.

Maybe I just like to worry.

It's human nature to never be satisfied unless we make a conscious effort to do so.


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Old 04-13-2015, 09:37 AM   #40
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I have not run Firecalc. I am in the process of tracking our spending (started in November 2014) for two or three years to understand our spending in more detail. Already this has been an eye-opening exercise. So, my magic number is changing, as are my spending habits.

Right now, I think the goal is $2MM, paid off mortgage, and to be work-free by 60. If we can decrease spending consistently and the market gods are with us, maybe we can shave a year or two off of this. If, if, if...
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