Alternatives

[Nords]

I can help on the quoting issue.

And you can "Modify" your post to cut & paste the text where you want it to go... as shown above.

 

[jdw_fire]

I like to travel and eat too too, don't have social security to look forward to but do have some investments and a pension to factor in.  This brings up a question I've had on my mind for a while - I'm 50 and if I were to retire today would have a pension of about 72K a year (full cola and subsidized health coverage included).  What does that translate to in FIRE talk so far as what it's worth?  Like how much real $ would a person have to invest to yield that kind of return?  (Actually, judging by the way my other investments perform, other than the real estate, it's a good thing I got that job with the pension at the end of the line.)

When I put a $72k CPI adjusted W/D into FIRECalc with a 40 year life the 95% success rate requires a portfolio of $1,848,138.  To figure how much more portfolio is required to produce the value of the "subsidized health coverage" you will need to first determine what that value is on an annual basis.

 

[jclarksnakes]

That $1,848,138 is roughly 25 times your 72K a year with COLA. The number 25 is often used as a rule of thumb for multiplying an annual pension to see what it is really "worth". This fits with the 95% success rate that lines up with the 4% withdrawal and 95% probablity of success rate in the FIRE calculator. It seems to me that the problem with multiplying an annual COLA covered pension times 25 is that it does not take into account that if we had the lump sum instead of the pension and were taking 4% plus an inflation adjustment every year there is a very very good possibility that we would have something left at the time of our unfortunate demise to leave to our ungrateful heirs...uh I mean loving children. The value of full COLA coverage especially for the really early early retiree is enormous. IMO it is impossible to put an exact dollar value on this based upon not knowing when we will be taking the final journey and also having no real idea what inflation will do between now and that important date.
jc.

 

[cute fuzzy bunny]

Now if COLA's and inflation were only the same thing...