Have you run your plan through FIRECalc: A different kind of retirement calculator? Good place to start.
As rule of thumb, 3% is widely considered a SWR for age 55 or less (one example of many below, 3.3% looks like the 95% success rate for a 40 year retirement based on past history at least). As you probably know, the 4% rate most often talked about was based on a 65 yo retiree living for 30 years. But both are without factoring in Soc Sec, which most if not all US citizens can factor in.
If you do FIRECALC, I'd take Koolau's suggestion to scale up your projected expenses by 15-20% to allow for taxes unless you know more exactly what your tax bite will be.
Your certainly in the ballpark financially, congrats!
Okay, I've been "playing" with FIRECalc, but I need more clarity on the tax issue. When I laid out our budget for the first year in retirement, I had already taken taxes into consideration which led me to the $30K draw down figure required in our first full year of retirement. Are you suggesting that I add an additional 15-20% on top of what I already estimated to pay in taxes in 2013 to account for a higher than inflation adjusted tax liability in the future? I don't have a problem with doing that, but I just want to be clear that that is what you're suggesting that I do. So if total expenses for the first year are, say, $100K and that $100K already includes our 2013 estimated tax liability, you're suggesting that I should add an ADDITIONAL 15-20% to our expenses making them $115-$120K instead of $100K? Is that correct?
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