Asset Selling Angst?

[SteveR]

I have been planning out my escape to the land of FIRE (yet again :) and one of the several scenarios is to sell off some after-tax stock funds to raise the cash needed for income with the least amount of taxation. I can do this for 3-4 years before I would start my IRA withdrawls to allow them to grow a bit more. However, I feel angst at the thought of switching gears from saving, accumulating, and investing to selling. It is just sort of hit me today as I was cross checking my DW's 401(k) account. We put a lot of thought into were to put her recent bonus and since we maxed out her regular 401(k) for the year we put a chunk into the "catch up" bin (up to the limit).

After years of stuffing this accounts with $$ and feeding and watering them with TLC to get them were they are today the thought of selling them off is actually painful.

I know I should not feel this way but, man, this is a real mind-altering thought process.

Is it just me or did the rest of you feel this way too?

 

[JPatrick]

I feel your pain, but two things provide relief:
1. You are withdrawing this money to do something, or live your life in a way you have dreamed about for numerous working years. What better way to spend money?
2. When I begin my modest withdrawals (about 2%) I'm projecting that the portfolio will just keep on growing, probably for as long  as I live and well after.  That thought eases a bunch of pain

 

[Cut-Throat]

2. When I begin my modest withdrawals (about 2%) I'm projecting that the portfolio will just keep on growing, probably for as long as I live and well after. That thought eases a bunch of pain

JP,

Actually, this is the part that would cause me pain. If you actually died with more assets than you retired with, what good would that be?

Money is only a tool, a number on a computer. Financial Savvy is not only building a Nest Egg, but enjoying spending it also!

I think a vary conservative plan has your principal pared in half by the time you hit age 90! Money can be infinite, time is finite! 8)

 

[JPatrick]

JP,

Actually, this is the part that would cause me pain. If you actually died with more assets than you retired with, what good would that be?

Money is only a tool, a number on a computer. Financial Savvy is not only building a Nest Egg, but enjoying spending it also

You are right CT, and I don't have any solid desire or plan to leave bundles of cash behind.  The reason I'm going with a 2% withdrawal initially is because I may take some big chunks out of the stash for a few major five  figure one time purchases. After that, I'll relook the withdrawal rate, but I'm thinking I'll still be down at the 2-3 % level.

 

[Nords]

However, I feel angst at the thought of switching gears from saving, accumulating, and investing to selling.
Is it just me or did the rest of you feel this way too?

How do you feel about working for the rest of your life to support your accumulation habit? Gotta choose one or the other.

I never met a stock I didn't like, and for those who can't bear to part with their shares there's always dividends. (OK, Unclemick, take it!)

 

[unclemick]

Yep

Even post Katrina - spending emergency reserve - relocating - actually buying a new house and vehicle:

Trying to enjoy what FireCalc says I can spend is slightly painful - old comfortable(cheap SOB) habits die hard. Still have 47 Drip stocks - from one share waiting to buy more to hundreds of shares bought in dribbs and drabs since the late 80's.

Next year - heh heh heh - plan to get a grip - Drips down to 15-20 div stocks, and spend up to 4% of portfolio.

And talk myself into enjoying  spending the money.

RIGHT!!!! Angst ?? What is that?

heh heh heh

 

[SteveR]

How do you feel about working for the rest of your life to support your accumulation habit?  Gotta choose one or the other.

I guess I will write it off as a character flaw; not wanting to part with something that was difficult to obtain and being raised by Depression Era parents that pinched pennies until they bled.    My father's family were dirt poor; sharecroppers.  Mother's family lost the family farm and were forced into doing what it took to survive.  Quite an experience and one that is life-changing.  Banks were not to be trusted; never take a loan except on the house; pay cash for everything; if you don't have the cash---don't buy it.  Find useful ways to re-use just about everything you have left over. Etc. Etc.  

And No, I have no intention of working longer than I want to or need to.  I ER'd once already but made a planned decision to contiune to work for a couple of years until my DW retires.  We sock away a nice chunk of our income but also spend a chunk.  

As for dividends, many of the stocks I have bought or acquired over the past 15 years do not have dividends.  My after-tax portfolio was started as a way of learning about stocks and the market in general.  Some of these have a very low basis ($.40) and I may hold those for my kids to have once I am gone so the basis is reset at current market value instead of mine.  Selling many of these shares will create a significant tax issue so that is also part of the planning process.    

I am still working on losing my emotional involvement with my stocks.  All recent purchases have been funds and no individual shares except where we get a company match or other incentive to retain company shares.  When I start selling them off, it will be like sending kids off to college; heartwarming, exhilarating, but also sad.



C-T,
My plan is also to die with a only small amount in my accounts for the grandkids.  I have no intention of hoarding more than is necessary to provide an acceptable income stream and to maintain an inflation cushion.  I agree that about half should be gone before I am 80 since the family genes would suggest I won't go much past that.  That still leaves a ton for DW to cruise the world and pick-up Spanish dance instructors for many years to come.  

 

[MJ]

Trying to enjoy what FireCalc says I can spend is slightly painful - old comfortable(cheap SOB) habits die hard.

Next year - heh heh heh - plan to get a grip - Drips down to 15-20 div stocks, and spend up to 4% of portfolio.

And talk myself into enjoying spending the money.

RIGHT!!!! Angst ?? What is that?

heh heh heh

Man, do I know what you're feeling. I know you were forced out at 49 and struggled to establish your comfort budget. I just started ER at the rip young age of 57. Firecalc, even with my 75/25 Fixed/equity is being more generous than I am comfortable with. I hope within a year (58) or two (59), I will let out "most" of the stops and enjoy most of my money.

MJ

 

[uncledrz]

Yes, its difficult after years of accumulating to change gears and start to enjoy the fruits and freedom of your labor. OTOH, when recently asked when we get to enjoy the money, I had to address the fact that if we don't start now, when?

Uncledrz

 

[Jay_Gatsby]

Yes, its difficult after years of accumulating to change gears and start to enjoy the fruits and freedom of your labor.  OTOH, when recently asked when we get to enjoy the money, I had to address the fact that if we don't start now, when? 

Uncledrz

Very good point. Learning to spend is likely to be just as difficult as learning to save, but may in fact be more difficult. Learning to save often requires the initial pain of deprivation, or divesting yourself of the money before you have it (i.e. 401(k) plan) to avoid feeling deprived. Unfortunately, there is no corollary to divesting yourself of money when you're learning to spend after FIRE. You already have money, and it's worth far more to you having saved it, watered it, and watched it grow for 20+ years.

When learning to spend again, there's no safety valve; there's no way to prevent yourself from spending too much, except by exercising the same self-control used to save the money in the first place. I would assume that FIRE'd people learning to spend in their retirement often have no sense of what constitutes "too much", and fall back on what they believed to be "too much" when trying to save money. This sounds like the situation that SteveR is presently confronting.

 

[acg]

I have been planning out my escape to the land of FIRE (yet again :)  However, I feel angst at the thought of switching gears from saving, accumulating, and investing to selling.  After years of stuffing this accounts with $$ and feeding and watering them with TLC to get them were they are today the thought of selling them off is actually painful.   

I know I should not feel this way but, man, this is a real mind-altering thought process.   

Is it just me or did the rest of you feel this way too?

"If I had my life to live over, I'd dare to make more mistakes next time. I would take fewer things seriously. I would take more chances. I would climb more mountains and swim more rivers. I would perhaps have more actual troubles, but I'd have fewer imaginary ones. You see, I'm one of those people who lived sensibly and sanely, hour after hour, day after day. Oh, I've had my moments, and if I could do it over again, I'd have more of them. In fact, I'd try to have nothing else...just moments, one after another, instead of living so many years ahead of each day. If I had my life to live over, I would go to more dances, I would ride more merry-go-rounds. I would pick more daisies."                                        -Nadine Stair (age 85 at the time she wrote it)

 

[unclemick]

Hmmm

If I had my life to live over - I wouldn't change a thing.

I sometimes wonder what thirty years in New Orleans (pre Katrina) did for my future life expectancy.

Maybe I should 'tone it down in slow MO.'

heh heh heh heh heh heh

Bon Temps Rolliere - doesn't translate up here.

 

[Mr._johngalt]

Bon Temps Rolliere - doesn't translate up here.

Maybe not, but the idea is usable world wide IMHO.

JG

 

[Eagle43]

Hmmm

If I had my life to live over - I wouldn't change a thing.

I sometimes wonder what thirty years in New Orleans (pre Katrina) did for my future life expectancy.

Maybe I should 'tone it down in slow MO.'

heh heh heh heh heh heh

Bon Temps Rolliere - doesn't translate up here.

http://thecajunconnection.com/zatarains.html?OVRAW=crab boil&OVKEY=crab boil&OVMTC=standard
You did bring some zatarains crab boil with you??  So buy some shrimp and French bread (I know, it will probably suck) and invite the neighbors over.  Couple of beers later, who knows, maybe the bon temps will reappear!

 

[preben]

I FIREd at 36 and was faced with the same dillemma. I had a cash stack to last me the first 6 months or so but when THAT started to run thin I really had to force myself to sell ANYTHING. I got going by simply following pre-set mechanical rules, and overall my portfolio has increased, but I am still learning to become better selling/withdrawing/spending. Cheers!

 

[Lancelot]

HmmmIf I had my life to live over - I wouldn't change a thing.

That pretty much sums up a successful life, IMHO.

Good for you Unclemick!

Lance