chinaco
Give me a museum and I'll fill it. (Picasso) Give me a forum ...
- Joined
- Feb 14, 2007
- Messages
- 5,072
I did a quick back of the envelop analysis of the state of our current portfolio with retirement income/expense projections and have determined that we can stay on track for ER.
Our plan is to spend a bit more in ER and less as we age. Of course, we do not know how it will actually play out.
Our plan includes:
Another way I could work it is just reduce our spend to conform to the 4% model directly in the early years. That would mean our initial income is about 1.6x of current expenses.
I have always included high income projections in our plan (compared to our current expenses/spending). We don't like like paupers... but we have a LBYM lifestyle.
Right now... If things stabilize and turn around in the next year or so, I am about 90% confident that I am on track for ER.
Have you done any analysis to see where you stand?
Our plan is to spend a bit more in ER and less as we age. Of course, we do not know how it will actually play out.
Our plan includes:
- Small Fixed Pension at ER (about 15% of beginning ER Income... It is reduce for taking it early)
- DW takes SS at 62
- I take SS at normal Retirement 66.x (option to take it earlier depending on what occurs in those years)
- Overall Inflation assumptions using long-term norm
- Our initial planned income till 70 is about 2x our current spend (while I am working)
- We reduce our inflation adjusted income at 70, 80, and 90 by about 10% to 15% at each 10 year interval. Which bring the income down to about 1x or a little more than 1x at 90.
- Average growth of portfolio is 8% from now till age 90... But with the portfolio positioned to handle volatility. Not sure if 8% from here is realistic on 60/40. All we can do is watch and adjust accordingly. Less return will translate to lower income in ER.
- We currently have company Retirement Health Insurance (x2)... DW and I both have it. But we will pay the double premium in case one company stops (at least until we are eligible for medicare)
- We have fairly low cost LTC policies (Group plan through DW work) that would defray a fair amount of those costs if we needed it (hopefully not). Short of having an extended LTC need... we should be covered pretty well for a risk perspective there.
- House paid off.
Another way I could work it is just reduce our spend to conform to the 4% model directly in the early years. That would mean our initial income is about 1.6x of current expenses.
I have always included high income projections in our plan (compared to our current expenses/spending). We don't like like paupers... but we have a LBYM lifestyle.
Right now... If things stabilize and turn around in the next year or so, I am about 90% confident that I am on track for ER.
Have you done any analysis to see where you stand?