Hi I'm galeno

[galeno]

I'm probably infamous to some of the regulars from the REHP board on TMF, but I should introduce myself to the new members that haven't seen me on the MF message boards.

I retired in 1995 at age 38 after working almost 14 years as a private practice physician in Costa Rica. I have a MD from UCIMED medical school in Costa Rica and I did my internal medicine speciality at Mt. Sinai Medical Center in NYC. I also have a MBA degree from INCAE business school in Costa Rica.

I started my quest to FIRE in 1982 by investing 20% of my gross monthly salary into Frank Russel offshore index mutual funds. I was paying an offshore bank a 1% gatekeeper fee to get into these funds. At the end of 1994, I switched to individual stocks with the idea of improving my CAGR and lowering my investment expenses of 1.5% per year. So far this strategy switch has been successful as I have beaten the S&P500 by 6% per year over the last 8 years. My risk adjusted return (as measured by the Sharpe ratio) also beats the S&P500's Sharpe ratio.

I'm married with four children aged 5 to 15. I currently live in Alajuela, Costa Rica.

[dory36]

Welcome, Galeno!

Are you still following the withdrawal process you described a couple of years ago on TMF? It was quite interesting to me at the time -- I bet readers here would like to read about it!

For folks here who haven't read Galeno's writings in the past -- he's certainly responsible for more than a few folks considering relocating to Costa Rica for retirement!

Dory36

[galeno]

Yes I am following the same mechanical withdrawal plan. In short, it goes like this:

FI = 25%
2y living expenses in MMF
2y living expenses in 2y CD (maturing in 1y)
2y living expenses in 2y CD (maturing in 2y)

Stocks = 75%

At the end of the year I sell 4% of the value of my stock portfolio and buy a 2y CD. I let half of the maturing 2y CDs go to MMF and I buy another 2y CD with the other half. I then divide the entire FI balance by 72 and that's my monthly draw for the year. At year end, I repeat the process.

Even with this three year bear market, my monthly FIRE income fluctuates very little thanks to my FI buffer. It's a similar approach to intercst's inflation adjusted withdrawals but slightly different in that I let the long term growth of my stock portfolio indirectly take care of any inflation or deflation in the economy.

[jackalope]

Are there any calculators or discussion about being able to figure annual withdrawals if you do not want to have any money left when you pass to the great beyond?

[Michael]

The way I understand it, the safe withdrawal calculators include some historical periods where your assets would have been depleted to near zero at the end of the selected term. There does not seem to be any way to safely increase withdrawal rate. To be sure that your money will not run out, you have to take the risk that some will be left over, since no one knows for sure when they will die. If your assets do significantly increase, you can take the safe withdrawal percentage of the larger portfolio. Of course, older people who buy annuities can sometimes increase the percentage of the initial portfolio spent each year. However, you will then be at risk if the insurance company goes out of business, and give up any hope of substantially increased withdrawals from a larger asset base in the distant future.

[intercst]

The only way to ensure you won't have any money left when you die is to buy a life annuity. The the insurance company gets the big pot of cash at the end of the rainbow.

intercst

[galeno]

I'm still using a 60/30/10 portfolio with a 3% AWR.

[clifp]

Quote:

Originally Posted by galeno I'm still using a 60/30/10 portfolio with a 3% AWR.

Galeno !! glad to see you are still happily retired. I am not sure if you remember me from REHP.

I am 80/10/10 FYI..
Got to get down and visit Costa Rica one of these days.

[obgyn65]

Welcome, OP. I am more conservative with my investments. Turning 48 this year. Would love to visit Costa Rica. :-)

[friar1610]

Wow! This is like the old days on TMF REHP - galeno, dory36, intercst, clifp.

I have since changed my screen name but used to post as jtmitch on TMF before it went so political.

[Golden sunsets]

OK guys - newbie here. What does the anacronym TMF REHP stand for?

[REWahoo]

The Motley Fool & The Retire Early Home Page.

[Texas Proud]

Welcome....


So, how is Costa Rico? This is one of the places that my DW is interested in retiring.... It would be nice to get a true rundown from a native...

[JDARNELL]

Ahhh yes Galeno. I rem well from TMF and your income smoothing strategy. In fact I modeled it years ago via excel and look at it often. From what I rem you were setting on the beach trying to keep the sand out of your laptop. Glad to see you surface here!

JDARNELL

[yakers]

Quote:

Originally Posted by friar1610 Wow! This is like the old days on TMF REHP - galeno, dory36, intercst, clifp. I have since changed my screen name but used to post as jtmitch on TMF before it went so political.

I also remember the TMF and diehards board days, happy to see the old folks posting, must mean we were/are doing something right. Really, it is nice to see different investment and withdrawal systems tested under real life conditions.

Just so we don't see the H0cu& person, may he never retire.

[Free To Canoe]

Thanks for answering my question about withdrawals here
http://www.early-retirement.org/foru...ml#post1108651
and welcome back.

[friar1610]

Quote:

Originally Posted by yakers I also remember the TMF and diehards board days, happy to see the old folks posting, must mean we were/are doing something right. Really, it is nice to see different investment and withdrawal systems tested under real life conditions. Just so we don't see the H0cu& person, may he never retire.

Just for the record, I don't want to get into *****-bashing, but his name came up in my house just yesterday.
My daughter is a writer. She is now writing novels but spent quite a few years doing freelance writing for various magazines to which she sold her articles. I don't remember the details but quite a few years ago she somehow - probably through an on-line connection - ran across ***** and actually interviewed him as an "expert" for an article she wrote. He sent her a copy of his book as a result. She gave the book to me.

As we are moving, we are tying to cull our possessions, books being the heaviest things to get rid of. We have 3 piles - donate to the local library, try to resell and recycle because the books don't fit either of the first two categories. My wife looked at the book and said she thought it looked like it might be worth trying to sell. I'm sorry to say that the ***** book ended up in pile #3.

[katwillny]

Glad things are working out for you. 38 is a very early age to retire. I was just in Jaco for second time. Will most likely be back in Oct.

[DFW_M5]

Welcome back oldtimer!

[packrat44]

Quote:

Originally Posted by friar1610 Just for the record, I don't want to get into *****-bashing, but his name came up in my house just yesterday. My daughter is a writer. She is now writing novels but spent quite a few years doing freelance writing for various magazines to which she sold her articles. I don't remember the details but quite a few years ago she somehow - probably through an on-line connection - ran across ***** and actually interviewed him as an "expert" for an article she wrote. He sent her a copy of his book as a result. She gave the book to me. As we are moving, we are tying to cull our possessions, books being the heaviest things to get rid of. We have 3 piles - donate to the local library, try to resell and recycle because the books don't fit either of the first two categories. My wife looked at the book and said she thought it looked like it might be worth trying to sell. I'm sorry to say that the ***** book ended up in pile #3.

You might consider donating it to someone who has an outhouse and is short on catalogs and corn cobs.