Poll: Retirees, how adequate is your retirement income?

[NW-Bound]

FIRECalc says I am way underspending, once future SS is considered. However, the market god may just take all that money away overnight.

About being a philanthropist, Quicken says that for the last 48 months, the "Gifts and Donations" category amounted to 12.04% of my total spending. I am not a church-going member, and none of that was for tithe.

 

[Ronstar]

I have a little more than I do spend, but a lot more than I should spend. I wasn't comfortable with my retirement income when I first retired, but I'm becoming more comfortable now that I'm 2+ years into it.

 

[Fermion]

If we get what we are promised in 20 odd years by the current SS estimator then we should have a little bit of breathing room, otherwise we will be in the "just enough" category and a little ticked off.

 

[NW-Bound]

... Last year we "invested" in a motorhome, and built a shop to house it...

Welcome back.

So, you sold the travel trailer. I still recall the thread when other posters were saying perhaps you needed a bigger pickup to pull it.

Darn, my memory is really superior.

Almost 47 and at a 3.12% WR, willing to go up to ~3.5%. Voted "a little more" than I need.

If you announced your retirement, I missed it. Must be when I was traveling or missed it somehow (meaning my memory is still superior - it's not forgetful if you never know about it).

 

[unclemick]

I give more to charities and the feds/state in taxes each than my yearly lowest expense year first starting ER 22 years or so ago.

heh heh heh - A good thing I think.

 

[Richard4444]

Being an Early Retirement Board, I would assume most who have been able to retire early have more than they spend - I fit into that category as well. What is interesting is that I never really had a budget when i w*rked, but now I do with multiple spreadsheets, etc., because once (speaking for myself) I ER'ed, I cannot earn more if I want to by going back to w*rk, just not an option I'm willing to explore.
Nice poll. Fun atmosphere on it!

Rich

 

[Major Tom]

As MichaelB says, this poll really is about perception. My current WR is a smidgin over 2% (2.05% actually) and although I am surviving comfortably, I'd like a bit more money to pursue my RV and traveling desires. I am completely ignoring SS in my calculations, which will come online in 10 years or more (depending on when I take it). If I were to include SS in my calculations and go for the maximum withdrawals that still give a 100% success rate in Firecalc, I'd have more than enough to do all that I want.

But I just can't make myself do it. I voted for the middle option, "I have just about exactly what I need, no more, no less" because withdrawing anything more than 2% and completely ignoring SS is, at least for now, the only strategy that gives me comfort and allows me to sleep at night.

 

[tmm99]

As MichaelB says, this poll really is about perception. My current WR is a smidgin over 2% (2.05% actually) and although I am surviving comfortably, I'd like a bit more money to pursue my RV and traveling desires. I am completely ignoring SS in my calculations, which will come online in 10 years or more (depending on when I take it). If I were to include SS in my calculations and go for the maximum withdrawals that still give a 100% success rate in Firecalc, I'd have more than enough to do all that I want.

But I just can't make myself do it. I voted for the middle option, "I have just about exactly what I need, no more, no less" because withdrawing anything more than 2% and completely ignoring SS is, at least for now, the only strategy that gives me comfort and allows me to sleep at night.

Wow, I thought I had made my budget tight, but compared to you, it isn't at all! (Mine is about 2.5%, but I am counting on SS) and I voted for the first one (I have a lot more than I can spend.) It must be all about the perception like you said.

 

[Fermion]

I am not sure SWR alone can predict how adequate is the retirement income.

There are a few factors. If you have $1m and need $20k to live, then your SWR is 2%

If you have $3m and need $60k to live, your SWR is still just 2%. This much is obvious.

But the person with $3m might be able to cut back lifestyle in a crisis where the person with $1m and a $20k spend might be near bare bones.

On the flip side, the person with $3m is much more likely to face higher taxes and means testing, so the person with $1m may have more confidence in future income streams like SS and subsidized healthcare.

 

[Major Tom]

Wow, I thought I had made my budget tight, but compared to you, it isn't at all! (Mine is about 2.5%, but I am counting on SS) and I voted for the first one (I have a lot more than I can spend.) It must be all about the perception like you said.

I'd like to loosen up, tmm99, but I just can't make myself do it. However, I think there are quite a few here with WR's similar to mine, and perhaps even more conservative.

Are there any therapists/counselors/shrinks here who are willing to do a little freelance consultation?

 

[rbmrtn]

When SS kicks in I will have a good bit more in income than what I spend. As of the moment.......it's pretty close.

That's similar to me. Currently arranged dividend income to cover expenses ( which less than what I used to pay in taxes). When the reinforcements arrive, pension + SS + RMDs, I'll have much more than I need.

 

[Midpack]

FIFY

I am not sure [-]S[/-]WR alone can predict how adequate is the retirement income.

There are a few factors. If you have $1m and need $20k to live, then your [-]S[/-]WR is 2%

If you have $3m and need $60k to live, your [-]S[/-]WR is still just 2%. This much is obvious.

But the person with $3m might be able to cut back lifestyle in a crisis where the person with $1m and a $20k spend might be near bare bones.

On the flip side, the person with $3m is much more likely to face higher taxes and means testing, so the person with $1m may have more confidence in future income streams like SS and subsidized healthcare.

 

[tmm99]

I'd like to loosen up, tmm99, but I just can't make myself do it. However, I think there are quite a few here with WR's similar to mine, and perhaps even more conservative.

Are there any therapists/counselors/shrinks here who are willing to do a little freelance consultation?

I may have the same ailment you do, but in a much smaller scale and I can probably kick it if I put my mind to it Maybe you are still young(ish) and have a long road ahead of you? What does your FireCalc type of tools say? Mine says I can spend more than twice as much, but this is my first year, so I am extra cautious...

 

[imoldernu]

We don't think about money very much.

As members of the Silent Generation, DW and I feel comfortable about what we have, given our age and condition. With a little more thought, we might be a model of the American Dream, as it was perceived back in the 1950's and 1960's. Wealth, per se, was not a part of that dream, rather a vision of what a good life could be.

It was a time when family was the basis for happiness. Children (we had four), a stay at home mom. Neighborhoods that were blended, and a community spirit, with Boy Scouts, church, school and the extended family at the core of our lives. Not every family had a car, or even a telephone, but class and wealth didn't seem to matter.

So, as to adequacy of retirement income? Not much of a concern. When television came in, we had our first exposure to the larger world, but even then, there was very little exposure to the American Dream that had to do with having money. The "ideal" family was not predicated on material things. There was almost no exposure to class differences, and certainly nothing that dwelt on money. Poverty, or "just getting by" was never a subject.

Old folks homes were there, but usually a farm, not a nursing home. Yes older people died earlier, but for those who didn't, there was always a grandma's or grandpa's room in the family home.

The comforting thoughts about old age, came from the promise of Social Security, so thoughts of amassing funds for the retirement years, was far from the thinking of the day.

Just my perspective, but living in retirement communities with people of my own age, makes me believe that most of my friends feel the same way. There are those with multiples of my own resources, and those with less, but most of us having lived in the golden years, see the world through the same glasses, and there have never been any discussions about income adequacy. Yes, a few have moved back to live with family, and a few have moved to less expensive communities, but most, are living the American Dream, as it was seen in those earlier days.

 

[W2R]

I'd like to loosen up, tmm99, but I just can't make myself do it. However, I think there are quite a few here with WR's similar to mine, and perhaps even more conservative.

Are there any therapists/counselors/shrinks here who are willing to do a little freelance consultation?

I just happen to have the solution!

Buy a dream house and fix it up so that is it utterly perfect for you to spend the rest of your years living in it. That'll take care of your 2% problem, believe me. My WR averaged 2% for the first 5 years of retirement, but last year was disastrous due to buying the house (8.4%, I think?) and this year with all my expenses in settling in and improvements, plus unexpected major dental work, I'll be glad if I spend less than 4%! My spending is just now beginning to settle back down. I have great hope for 2% again, for 2017.

I would imagine that some of our travelers taking their "trip of a lifetime" know exactly what I'm going through, financially speaking. It's hair-raising but it's nice to know that I can afford it.

P.S., to all those participating in this poll - - I'm glad that some of you posted that you are having fun with the poll. That's what it is all about, FUN! I just want everybody to kick back and vote however they want to vote. YOU're in charge, here, YOU make the definitions, and YOU get to decide how YOU feel about your income, so laissez les bons temps rouler and have a ball.

 

[Major Tom]

Midpack - thanks for the correction of SWR to WR. I've often wanted to point out the difference, but didn't want to seem pedantic. However, it is (to me at least) an important distinction. There is a definite difference between a Safe Withdrawal Rate (the WR that is estimated to not lead to portfolio failure), and a WR, which can be any old figure you decide on. You can have a WR of 25%, but it sure as heck ain't a SWR!

 

[Major Tom]

I may have the same ailment you do, but in a much smaller scale and I can probably kick it if I put my mind to it Maybe you are still young(ish) and have a long road ahead of you? What does your FireCalc type of tools say? Mine says I can spend more than twice as much, but this is my first year, so I am extra cautious...

I'm 52 and am planning for another 40 years so yes, that does have something to do with it. If I take future SS into account, Firecalc says that I could spend double and still have a 100% success rate, but I'm playing it cautious.

OTOH, I sure would like that class B camper van...........

 

[tmm99]

I'm 52 and am planning for another 40 years so yes, that does have something to do with it. If I take future SS into account, Firecalc says that I could spend double and still have a 100% success rate, but I'm playing it cautious.

OTOH, I sure would like that class B camper van...........

Yep, that makes sense. At 52, I can see you being extra cautious.

 

[tmm99]

I just happen to have the solution!

Buy a dream house and fix it up so that is it utterly perfect for you to spend the rest of your years living in it. That'll take care of your 2% problem,

I would think he would have to move first since he lives in the bay area. A house purchase n the bay area would have definitely broken my Fire and many others.

 

[Major Tom]

LOL - a house purchase here would use up my entire stash!

But W2R - the spirit of your comments are certainly giving me food for thought, as my personal dream is a little camper van, which is much more affordable than a house in the Bay Area.

 

[W2R]

LOL - a house purchase here would use up my entire stash!

But W2R - the spirit of your comments are certainly giving me food for thought, as my personal dream is a little camper van, which is much more affordable than a house in the Bay Area.

Well, there you go! Buy your dream camper van, and fix it up to be just exactly what you want, and I guarantee that your 2% will go out the window at least for a year or so.

I often forget (and can hardly believe!) the prices of houses in the Bay Area. Every month or two I "go there" on realtor.com and it is just mind boggling to me. I thought houses were expensive in Berkeley back in the 1960's when I lived there, but wow - - they are just through the roof there. And SF? The prices there just make me laugh these days.

 

[audreyh1]

We supposedly have (way) more than enough, but only 5 years in with another 30+ to go, I wouldn't presume to really know, so I voted "a little more." All we can do us plan as best we can, have a plan B, C, D --- and enjoy/live life in the present. That's my story and I'm sticking to it...

Same here. And I don't want to tempt fate!

All we need is another big market swoon with a very slow recovery, and all of a sudden I'll be in the just getting by camp.

 

[FIREd]

I would think he would have to move first since he lives in the bay area. A house purchase n the bay area would have definitely broken my Fire and many others.

Yes, for us it was either a house in the bay area or FIRE. We decided that FIRE was way more important.

 

[SecondCor521]

If you announced your retirement, I missed it. Must be when I was traveling or missed it somehow (meaning my memory is still superior - it's not forgetful if you never know about it).

Since returning to these boards, I have tried to be more unassuming. I'm not sure why.

My "announcements" - such as they were - were here:

http://www.early-retirement.org/forums/f28/share-your-fire-milestones-65754-11.html#post1704620

and here:

http://www.early-retirement.org/forums/f29/class-of-2016-a-56133-4.html#post1700159

I have a journal going on over at the MMM board with many details:

Login

 

[REWahoo]

I'm 52 and am planning for another 40 years so yes, that does have something to do with it. If I take future SS into account, Firecalc says that I could spend double and still have a 100% success rate, but I'm playing it cautious.

OTOH, I sure would like that class B camper van...........

Tom, it pains me to see you procrastinating on the RV, year after year. I understand some reluctance due to your tender age, but you have to know that the "no SS" fear isn't realistic. If SS isn't there for you in 10 years then you (and the rest of us) will have problems far greater than wishing you hadn't purchased and enjoyed using that RV for the past decade.