Retirement - 3% - 4% Withdrawal

[nun]

Sometimes when I read the replays I think we are often comparing "apples" to "oranges". To retire on $35,000/year must assume no taxes, funded health care, no significant gifting and no gifts to the kids/grandkids and very minimal travel. Tax free pensions( state taxes), free health care for life, etc is a whole different ballgame- No pension no Roth IRA, having to pay for medical and dental care and a few grandkids puts comfortable retiring under $100,000 hard( assume that is all taxed).

You're correct that a $35k annual budget probably means that some common large costs have been eliminated or reduced.

My budget is $35k/year, but I have no mortgage or other debt, my pension is state tax free and I pay $100/month for low deductible healthcare. Once I take off allowances and deductions my Federal tax bill is also pretty small.

I travel most years, but it's usually on my bicycle......a couple of years ago I flew to Seattle with my bike and rode it back to the East Coast and that trip fit within my annual budget. I give some money to my nieces each year, but the big payout for them will be after I'm gone as they get the majority of my estate.

 

[scrabbler1]

It also depends on how much cash you hold in that buffer or cushion. I keep about $750 beyond the minimum balance requirements in my local bank's checking account. This covers me for small, unforeseen expenses which often arise from month to month. Larger, unforeseen expenses come from my second-tier emergency fund, something a rarely have to tap into. That money is in an intermediate-term, muni bond fund which earns just over 2% tax-free.


I don't like having to tie up money in an interest-free account, but I get many handy day-to-day services from my local bank, so not earning any interest on the rather small amount (about $2,000) I keep in there is okay.

 

[bigmarley4]

withdrawal rate

Very interesting thread - thank you to everyone who posted their #'s. My wife and I are on the FIRE path and will need our nest egg to last longer than the typical 30-year window as we're on track to be FI at a pretty young age and don't want to keep going in the rat race. The calculators aren't as useful because of the assumptions behind them, so it's helpful to see what you all are doing in the 'real world' so to speak.
-bigM