Hi! ...I am stressed to pull the trigger

[Mdlerth]

Quote:

Originally Posted by Go-NoGo Try this calculator at the UK office of National statistics: https://www.ons.gov.uk/peoplepopulat...nge/2017-12-01 if you are Male and 55 years old, the odds of you living to 100 are 6.3%

I think the UK calculator has a gremlin in it. The higher the "current" age you enter, the lower it computes your odds of living to 100.

That doesn't make sense. Your odds of hitting 100 should get higher as you age, not lower.

Every year you stay this side of the dirt, the more shorter-lived people get weeded out of your birth cohort. The remainder, including you, constitute a subset which not only will have a higher average but also contain an upper tail of the distribution (those reaching 100 or more) which represents a higher fraction of the remaining population.

IOW, say 30 out of 1000 of your birth cohort will make it to 100. That's 3%. Those 30 individuals fated to hit the century mark are still alive when you hit 80, but by then half of the original class is already in the cemetery. Therefore, 30 of the remaining 500 will make it to triple digits; that's now 6%.

Survey the class again eight years later when the class has been further halved. All 30 of the future centenarians are still alive, along with 220 who won't make it all the way; 30 out of 250 is now 12%.

[Go-NoGo]

Quote:

Originally Posted by Mdlerth I think the UK calculator has a gremlin in it. The higher the "current" age you enter, the lower it computes your odds of living to 100. That doesn't make sense. Your odds of hitting 100 should get higher as you age, not lower.

I noticed that as well, so when I run the numbers for a couple of age groups:

20 year old male: 87 avg life expectancy, 15.8% chance of reaching 100
40 year old male: 86 avg life expectancy, 9.7% chance of reaching 100
60 year old male: 85 avg life expectancy, 5.4% chance of reaching 100

My guess (and this is only a guess) is that it is modelling for increased life expectancy based on future advances in medical technology and this would benefit the younger cohorts more as they have a greater exposure to it throughout their lifespan.

Or it could be a bug.

edit: interestingly enough for a 100 year old male:
100 year old male: 102 avg life expectancy, 100% chance of reaching 100
- so it gets this edge case correct

[wazoomann]

Congrats on saving that amount of $$ - you live a very, very nice lifestyle. I could retire on one tenth that LOL. You have a lot of room to reduce expenses and I wouldn't worry so much. Enjoy! Plus...you can always do some part time consulting if you need $ or get bored in retirement.

[Flotuspa]

Hi, new member here. This post and the replies caught my attention.
As a professional living in a suburb of a big city in a middle of the road (no mansion) but comfortable home and (like in our case) 2 teens still at home, those expenses do not seem out of line. Everybody has a different view of what a comfortable retirement is. For me, it means not compromising my current standard of living and our expenses are in the same ball park of the original poster's.
My Mom is in her 90's and is frail but healthy and my grand-mother lived until 99. So, with those genes, I have to plan for a long and hopefully mostly healthy life.
My advice would be to go for it and enjoy life. You worked hard and now's the time to enjoy life a little. If you are stressed about $$, consult for the first few years at your leisure. This will ease you into your new routine and cover your discretionary expenses which will serve mostly to put your mind at ease.. Life is too short.

[StuckinCT]

Quote:

Originally Posted by Morris4096 I am coming out sort of speak. I have followed so many of you on this forum and have read many informative threads. Seeking input to give us confidence to make the move. We have been lucky as hell but feel the time is up. Turning 58 and DW is 54 who retired last year. DW and I have been working since our teens and have been fortunate to always be employed by megacorps and avoided layoffs multiple times over 35 years. Sheer luck. Lived well but no big house compared to neighborhood outside of DC and thus saved a considerable portion of income over the years and invested like clock work from the age of 20. Never worried about money until I started to think about pulling the plug and DW and I are stressed out with decision to cut off income stream. We have no sources of income to come other than SS so what we have in investments has to feed us. Job is killing me , lost confidence in megacorp mgmt and want to leave by spring 2020. DW has good genes and will live to 100 and is worried about having enough to carry her for 45 year retirement horizon. I might be good till mid eighties based on family history. Projected Expenses In Retirement House Insurance $1600 Taxes $7000 Electricity and Gas $3800 Sewer $900 Trash $1000 Water $900 Cable/internet $2400 Cell $2400 House cleaning $3600 House maintenance $4200 Food /Restaurants Groceries /Liquor $9600 Dining Out $10800 Car Expenses Gas for 2 cars $7,560 Insurance for 2 cars $4,728 Car maintenance $4,200 Car fund to replace one car every five years $9,600 Health Expenses Health and dental insurance for family $6600 Out of pocket( copays and contacts and rxs) $4000 Liability insurance (umbrella) $1600 Entertainment /Travel /Pet Entertainment (movies, Netflix, concerts ,lessons ) $4800 Fitness memberships $4800 Vacation $30000 Pet costs ( vet, food boarding) $3000 Other discretionary expenses Dry cleaning $1000 Hair/nails/grooming $ 2000 Clothing $6000 Gifts /charity $ 17000 Total Year Budget= $160,000 ( after tax expenses) Healthcare insurance costs between now and 65 are being subsidized ( 6600 cost to us ) from retirement package. At 65 and then receive subsidy of 3K per year for medicare coverage. Not sure what that will cost for 2 and keeping my daughter insured until she finishes 4 year college in 2028. Nest Egg DH IRA $1.1M DH Lump Sum Pension rollover $1.2M DW IRA $1.2M Taxable accounts 2.2M Portfolio 60 /30 /10 stock/bond /cash….total retirement assets =$5.7M House value = 600K 529 Plan =300K for daughter college expenses to start in 2023 Social Security Estimates DH =2400/month at 70 DW = 2000/month at 70 Tax assumptions I am assuming the my effective tax rate until 70 would be about 20% until social security and RMD kick in and then effective rate might up. Not sure how to model this. Assuming 160K of expenses annually, I would need to generate 200K before taxes for the first 12 years or so. Firecalc Ran model with $5.7M portfolio, 200K before tax income from portfolio and taking social security at 70 . This is about a 3.5% withdrawal rate until SS kicks in. Firecalc outcome is 100%. Why are we stressed? We are at the peak of the market and believe sequence or return risk is acute. I do not want to go back to work even part time once I am gone . We could cut back budget in many areas if needed . Do not replace cars every 5 years and do it at 10 years . Cut back on entertainment / travel and restaurants. We have not accounted for long term care insurance but think we can fund long term care with assets . We would appreciate comments and advise on plan for a 45 year retirement …at least for DW. What have we missed? Are we silly to be stressed at this point?

I know exactly how you feel, as we are in a similar 3.5% 100% firecalcl situation but feel stressed like you about pulling the plug. I am a little younger at 48. If I were in your shoes, I would not hesitate to call it quits with a 3.5% WR.

I also have experienced others in this forum questioning my net worth sincerity etc based on what some may consider a high net worth. Some people are rich with $2mm, others with $20mm, so disregard the wealth comments- all that matters is that you have a sustainable situation.

Withdrawal rates, though important, are not the only factor IMHO. The fact that you have subsidized health insurance makes that 3.5% WR even safer. Congratulations on amassing a sizable portfolio and go ahead and retire as firecalc incorporates sequence of return risk, health is a factor that can always turn things upside down, but you have higher certainty than most with this cost.