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Old 05-05-2016, 10:33 AM   #21
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I've been ER'd for 13 years now and so far all expenditures have come from our taxable pot and SS that we decided to start at age 62 for both us (3 years ago for me - I promised my wife not to tell when that horse left the gate for her) and a very tiny corporate pension ($400/mo). This has resulted in a comfortable life style with no desire to upgrade the level of expenditures - we have enough.

Being that our taxable pot is about 40% of the total pot in a few years (65 now) there is going to be a substantial increase on the draw down (due to MRD's) and my feeling at this time is so be it. I think the MRD plan is fine - Draws will just get converted to taxable stock funds if the pot really grows and they will not be quite as large (or maybe not at all) if the market doesn't cooperate. If it grows my kids will be happy, if it doesn't grow quite as much and some of the calamities everyone talks about comes to pass, we'll still be better off than most. What more can one ask for? The beauty of LBYM and investing.
I think this is key. If you already LBYM, why would you want to increase your WR? I'm quite content with my current spending situation (and will be even more so once I leave Los Angeles). In fact, in some ways my spending has actually and naturally decreased, and I'm not sure yet why. Could it be contentment requires less money? Yes, I could increase my WR if I wanted to, but what for? What would I spend more on? More travel? Travel first class? Maybe. Maybe not.

For years now, I've lost interest in shiny new things and experiences (not that I don't buy them when its required, mind you; I just don't "need" or "want" them). That whole power spending thing is so 1980's to me, sort of like big hair, men's power ties, and women's shoulder pads. OTOH, a midday nap, disappearing into a new book with afternoon coffee at my favorite coffeehouse, and a SWAN PF are priceless, IMO.
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Yet another guide to withdrawal rates
Old 05-05-2016, 01:38 PM   #22
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Yet another guide to withdrawal rates

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Originally Posted by Options View Post
I think this is key. If you already LBYM, why would you want to increase your WR? I'm quite content with my current spending situation (and will be even more so once I leave Los Angeles). In fact, in some ways my spending has actually and naturally decreased, and I'm not sure yet why. Could it be contentment requires less money? Yes, I could increase my WR if I wanted to, but what for? What would I spend more on? More travel? Travel first class? Maybe. Maybe not.

For years now, I've lost interest in shiny new things and experiences (not that I don't buy them when its required, mind you; I just don't "need" or "want" them). That whole power spending thing is so 1980's to me, sort of like big hair, men's power ties, and women's shoulder pads. OTOH, a midday nap, disappearing into a new book with afternoon coffee at my favorite coffeehouse, and a SWAN PF are priceless, IMO.

It's more about what that money may be able to do vis a vis setting and cementing your legacy than about buying more crap to fill the house and garage. Think of it differently:

Example: What student might you be able to help afford to attend some school program that he/she otherwise couldn't afford by giving or establishing a small scholarship fund.

What charitable organization needs a little boost to accomplish their objective. Humane society. Etc.

What impact might you be able to have on those and the community around you by giving more before you die than to have it get allocated post life.

It's a chance to give and see the impact.

That's powerful and it even is proven to release chemicals that do the body and mind good.

Not more stuff. Not more travel. This is a chance to learn about and do some giving. That's powerful. Pay it forward.
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Old 05-05-2016, 09:23 PM   #23
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It's more about what that money may be able to do vis a vis setting and cementing your legacy than about buying more crap to fill the house and garage. Think of it differently:

Example: What student might you be able to help afford to attend some school program that he/she otherwise couldn't afford by giving or establishing a small scholarship fund.

What charitable organization needs a little boost to accomplish their objective. Humane society. Etc.

What impact might you be able to have on those and the community around you by giving more before you die than to have it get allocated post life.

It's a chance to give and see the impact.

That's powerful and it even is proven to release chemicals that do the body and mind good.

Not more stuff. Not more travel. This is a chance to learn about and do some giving. That's powerful. Pay it forward.
My thoughts exactly. And it doesn't cost a thing to engage in most of the actions you mentioned. For example, my work mentoring youth starting in this month will cost me nothing, yet will impact these individuals (hopefully for the rest of their lives), and will serve as an investment in society as well.

OTOH, having worked in "leadership" in non-profits at some points in my career, I have no interest in "helping charitable organizations accomplish their objective." Those people are about half a mile left of crazy, in my experience (not unlike "leadership" in the private sector, if one is to be completely honest about it). Any work I do will be what is referred to as "direct service" to clients.
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Old 05-05-2016, 10:11 PM   #24
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Any engineer will tell you that, for mission critical systems, you should always have designed redundancy.
I spent most of my career in aerospace, doing R&D on flight critical systems for both civilian and military aircraft and rockets.

But when it comes to my retirement, I realize that I can redefine the "mission" if necessary. Hence, the requirements are not as strict.

That said, I am spending way below what FIRECalc says I can. I love money.
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Old 06-08-2016, 12:35 PM   #25
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Another article, this one is more a short summary for newbies.

Today's Retirement: Does the 4 Percent Rule Still Make Sense?
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Old 06-08-2016, 02:14 PM   #26
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But when it comes to my retirement, I realize that I can redefine the "mission" if necessary. Hence, the requirements are not as strict.
Also, building a retirement system with more redundancy before launch can seriously reduce mission lifetime.

It's critical, (relatively) one-shot but also time-critical.
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Old 03-30-2017, 11:18 AM   #27
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Here's one take on the various withdrawal strategies, from fixed to those that adjust based upon various factors:

https://earlyretirementnow.com/2017/...t-11-criteria/

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Withdrawal rate rules we consider

  1. The Fixed 4% rule: Set the initial withdrawal amount to 4% of the portfolio and then adjust by the CPI every month.
  2. Guyton-Klinger with a 4% initial rate. +/-20% guardrails and 10% adjustments. For a primer on what this rule does and some of the skeletons in the closet, check our previous posts on that topic, Part 9.
  3. The same Guyton-Klinger rule but with a 5% initial rate.
  4. Constant percentage: withdraw a fixed 4% p.a. of the portfolio over time (i.e., 0.333% each month).
  5. The Variable Percentage Withdrawal (VPW) rule, see the Bogleheads link on this, assuming a 40-year retiree (mid-point between Mr. and Mrs. ERN’s age at our planned retirement date). The same mechanics as the constant percentage, though we start at 4.6% and increase the rates based on the remaining life expectancy, calculated by smart folks at Bogleheads. In our simulations we cap the withdrawal rates at 8%, though, to ensure we don’t deplete the principal in year 60. We still like to leave a nice size bequest.
  6. A rule based on the Shiller CAPE: Calculate the Cyclically-Adjusted Earnings Yield (=1/CAPE) and use this as a proxy for expected equity returns. Then set the withdrawal rate to W = a + b*CAEY with the appropriate parameters for a and b. The first time I encountered this rule was at the cFIREsim site where they use this exact parameterization as their default values: a=1% and b=0.5. (There is some science behind the parameter choice and we will deal with the details in a later post!)
  7. Same as 6 but with a=1.5%, i.e., shift up the withdrawal rate in 6 by another 0.50% p.a.
  8. Same as 7 but with a=2.0%.
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Old 03-30-2017, 11:40 AM   #28
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Here's one take on the various withdrawal strategies, from fixed to those that adjust based upon various factors:

https://earlyretirementnow.com/2017/...t-11-criteria/
His series has been a good read.
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