What We Believe

HNL Bill said:
While there are a broad diversity of individuals and philosophies on this forum, I’m going to take a stab at what we, as an average group believe. Please feel free to add constructively to the list.

We believe that for most here:


  1. Early retirement means retiring at 55 or earlier. I would say it's any time before FRA as defined by SS.
  2. Hope is not a strategy.
  3. Living below your means prior to retirement is the key to attaining ER.
  4. FireCalc can give you one of the best predictions as to whether you’re ready financially to retire, but that you should use multiple retirement calculators and/or Monte Carlo simulators to confirm your results.
  5. Follow the 4% rule or better yet, make it the 3-3.5% rule (confirmed by FIRECALC). Better yet, use a flexible withdrawal method on top of any income floor such as SS, Pension, etc.
  6. You need to know your budget prior to retirement.
  7. You need to know your budget in retirement, and ensure you’ve accounted for everything, including health insurance and possibly LTC.
  8. Diversified investments diversify risk.
  9. Asset allocation is king.
  10. Maintain a solid asset allocation, especially in retirement. Most include some equities (50-60%+ with some % of international funds), some bonds/bond funds (10-60%), and cash/money market/CD reserves (1-3 years living expenses).This seems more like a more detailed version of #9 above.
  11. Invest in mutual funds, not individual equities (which carry higher risk). Mutual funds and/or ETF's.
  12. Timing the market does not work as effectively as long-term investment with AA.
  13. Save and invest with withdrawal strategies in mind (including taxes). This means having both taxable and tax-deferred investments.
  14. Determine the best time for you and your spouse or SO to take SS.
  15. Plan for a decrease in SS benefits (say, 25%).
  16. Plan for the elimination of the ACA in its present subsidized form.
  17. Have something to retire to.
  18. Plan to maintain or exceed one’s pre-retirement standard of living in retirement.
  19. Avoid annuities. Avoid variable type annuities due to opaque cost structures, but SPIA's can be helpful in certain circumstances and are relatively inexpensive.
  20. Avoid speculative ‘investments’ with no basis in value.
  21. Your investable assets are what matters, along with any debt. The value of your house or classic car collection are not investable assets, unless you are going to sell them.
  22. Consider Roth conversions in early retirement, if your tax situation warrants.
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See above
 
-trust but verify

-the only person that cares about your money/investments is you

-always remember the risk/rewards rule.

-the only certainty is death and taxes
 
Asset allocation differs depending upon the investor but basically drift from aggressive to moderate as we age. (90% stock / 10% fixed income / just taking dividends)
 
Teacher Terry said:
I think that there are plenty of people that don’t desire to have the same standard of living in retirement. It seems to me that some are happy with less because the time is more important. If in the future we have to quit taking big trips it was worth it to us to have the time. We will never be poor but but who knows what the future holds.
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My wife and I do not plan to maintain our current standard of living/spending level when we retire. I ran the numbers today and to maintain our current spending levels assuming we live to be 100 years old and 70% of estimated Social Security, we'd need to work 5 more years to hit 100% on FIRECalc.

We'd be much happier with a lower spending level, no w*rk, and have those 5 years.
 
ZenMaster said:
My wife and I do not plan to maintain our current standard of living/spending level when we retire. I ran the numbers today and to maintain our current spending levels assuming we live to be 100 years old and 70% of estimated Social Security, we'd need to work 5 more years to hit 100% on FIRECalc.

We'd be much happier with a lower spending level, no w*rk, and have those 5 years.
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It depends on your pre-retirement standard of living. Some of us live very frugally before retirement, to be able to retire early and spend more later. My post-FIRE budget is 200% of my current budget, as I want to be able to do a lot of dive travel. For others, who live below their means less than I do (e.g., have a higher standard of living prior to retirement), I can see cutting back to retire early.
 
I disagree with almost all of the items on the list.

  1. Live frugally
  2. Plan for the future
  3. Everyone's situation is different (i.e. what's wrong for you may be perfect for me)
 
HNL Bill said:
While there are a broad diversity of individuals and philosophies on this forum, I’m going to take a stab at what we, as an average group believe. We believe that for most here...[/LIST]
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This was an attempt to state what we, as an average group, believe. There are outliers with every group.

About half of the respondents (no, I did not count) generally agreed with the list. About half offered differing opinions.

The list was created after reading thousands of posts here, and reading perhaps hundreds of thousands of responses. Yes, we're all different, but I believe, that most in this forum (especially those who plan to retire more than several years before 62) are very similar in their planning approaches, investment approaches, and end goals.

Thanks for your participation and input!!! Great group!
 
We believe that for most here:


  • There is no definitive answer to the question "what is the best age to start drawing social security benefits?"
  • There is no definitive answer to the question "should I pay off my mortgage early?"
  • In spite of these two beliefs we still love nothing more than debating the questions ad nauseum.
 
joeea said:
We believe that for most here:


  • There is no definitive answer to the question "what is the best age to start drawing social security benefits?"
  • There is no definitive answer to the question "should I pay off my mortgage early?"
  • In spite of these two beliefs we still love nothing more than debating the questions ad nauseum.
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Plus to a lesser extent, Roth conversions, ACA subsidies. :LOL:
 
Maybe 22 should be something like "if it's debated ad nauseum here, flip a coin and you're fine"
 
Nice list HNL Bill, don't agree with half, but nice anyway.

Aerides said:
According to a recent poll, we're about 1/3 female:
Early Retirement & Financial Independence Community - View Poll Results
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Just cause I'm 2 cheeseburgers away from a B cup doesn't make me 1/3 female!

Teacher Terry said:
I think that there are plenty of people that don’t desire to have the same standard of living in retirement. It seems to me that some are happy with less because the time is more important. If in the future we have to quit taking big trips it was worth it to us to have the time. We will never be poor but but who knows what the future holds.
Click to expand...

My standard of living is higher though the cost of living is much lower. I just finished a 2 month trip that cost less than $2,000. If I was still working it would have been two weeks at the most and I probably would have insisted on spoiling myself with at least $4,000 in beach front hotels.
 
GravitySucks said:
I just finished a 2 month trip that cost less than $2,000. If I was still working it would have been two weeks at the most and I probably would have insisted on spoiling myself with at least $4,000 in beach front hotels.
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+1


When vacation time was very limited, I found myself spending more to ensure that my vacation time was spent seeing and doing what I wanted rather than figuring out basic stuff. Now that I have the time, I can enjoy figuring out the basic stuff as well as seeing and doing things of interest.
 
marko said:
I think the OP was just trying to make a general profile of our group, not exclude anyone.

Most of the list is a distillation of what hundreds have stated in thousands of posts through the years.

Sort of a cheat sheet for the forum. I don't take any of it personally and take the list as being fairly lighthearted .
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+1 :)
 
HFWR said:
“Tonto, we’re surrounded by Indians!”

“Whattaya mean we, paleface...”
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Reminds me of the old joke about when the Lone Ranger was bitten by a rattlesnake and what Tonto told him. :LOL:
 
Doc says you're gonna die
 
Fun list; food for thought
Early retirement means retiring at 55 or earlier. Anything below full retirement age, which for me is 67. I'm considering 60.
Hope is not a strategy. Agree
Living below your means prior to retirement is the key to attaining ER. It is one very important key.
FireCalc can give you one of the best predictions as to whether you’re ready financially to retire, but that you should use multiple retirement calculators and/or Monte Carlo simulators to confirm your results. Have used these.
Follow the 4% rule or better yet, make it the 3-3.5% rule (confirmed by FIRECALC). Plan for me is under 3%. DH is another story
You need to know your budget prior to retirement. Well, that would be best but we're ball parking it.
You need to know your budget in retirement, and ensure you’ve accounted for everything, including health insurance and possibly LTC. Health insurance taken care of. LTC has to be self insured.
Diversified investments diversify risk. Yes
Asset allocation is king. Keeping spending under control is king. Asset allocation Queen.
Maintain a solid asset allocation, especially in retirement. Most include some equities (50-60%+ with some % of international funds), some bonds/bond funds (10-60%), and cash/money market/CD reserves (1-3 years living expenses).
Invest in mutual funds, not individual equities (which carry higher risk). Agreed, but I still haven't gotten around to cashing in all stocks
Timing the market does not work as effectively as long-term investment with AA. Agreed
Save and invest with withdrawal strategies in mind (including taxes). This means having both taxable and tax-deferred investments.Agreed
Determine the best time for you and your spouse or SO to take SS.Agreed
Plan for a decrease in SS benefits (say, 25%).
Plan for the elimination of the ACA in its present subsidized form. Not an issue
Have something to retire to.DH does: me not so much.
Plan to maintain or exceed one’s pre-retirement standard of living in retirement.Hmmm, it will be very different
Avoid annuities.Too late there, I have one through Vanguard
Avoid speculative ‘investments’ with no basis in value. Agreed, other than the occasional lotto ticket, which I classify under entertainment
Your investable assets are what matters, along with any debt. The value of your house or classic car collection are not investable assets, unless you are going to sell them.They all matter; but only investible assets are used to calculate withdrawals
 
I would use "living within your means" as opposed to "living below your means." Just my take and YMMV.
 
Batten down the hatches when W2R says "whee";)
 
target2019 said:
No, it does not mean that, IMO. That's a non-starter, if many folks are eliminated from the game by your #1.
:popcorn:
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donheff said:
The age of early retirement is in the mind of the retiree. It is the desire to retire earlier than you might otherwise that brings people here.
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I agree that there are no black and white answers. A person who planned to retire at 75 and changes that based on this forum would qualify IMHO. But like all posts, #1 has more truth than not. As do all the others. Good job.
 
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