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Old 07-26-2020, 09:40 AM   #21
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^And of course dropping lifestyle down a notch if possible to below $100K/yr expenses would help. I cut back on things involving high maintenance (retired at 54 last year, waiting for 59.5 to raise lifestyle bar back up a notch as most in IRAs). I'd rather drop down lifestyle a bit than work again but if you love working...
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Old 07-26-2020, 09:42 AM   #22
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One thing we all underestimate is the effects of inflation. Even 20 years at a very moderate average of 2.5% reduces the buying power of a dollar by 40%. Long term US average inflation is 3.11% IIRC and trailing 40 year average is over 4%.

My personal bogeyman is a decline in the value of the US$. Virtually every country in the world hates that the $ is the reserve currency and many of the larger economies like China and the EU would like very much to knock us off our throne. A 20% decline would cause huge pain and chaos as most internationally traded products like food, oil, and plastic would be 25% more expensive crossing the border. Not to mention clothes, consumer electronics, major components of cars, etc. It might take a decade for our economy to adjust.
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Old 07-26-2020, 09:54 AM   #23
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^Printing more money isn't helping value of US$. Apparently can only work if demand exceeds supply of printing extra, right? And doesn't GDP also need to grow? (I'm not an economist so not sure).
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Old 07-26-2020, 09:59 AM   #24
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It appears that you have a couple of mortgages including in your $120k spend. Do those drop off in the next ten years or so? That would help your numbers.
Good point, and if you include mortgage payments in expenses in FIRECalc then FIRECalc inflates those expenes and they never end, so you get flawed success rates.

It would be preferable to exclude mortgage payments (P&I) from spending and reduce the portfolio input into FIRECalc for you mortgage balances... like you pay off your mortgages before retiring... that will provide a truer success rate.

Alternatively, you can include mortgage payments as fixed off-chart spending starting immediatelyand then offset it with a fixed pension entry of equal amount in the year the mortgage ends.... that avoids the inflation of the expenses and provides an end point.
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Old 07-26-2020, 10:04 AM   #25
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^Printing more money isn't helping value of US$. Apparently can only work if demand exceeds supply of printing extra, right? And doesn't GDP also need to grow? (I'm not an economist so not sure).
There is ample fodder to feed anyone's growing paranoia. (That is actually this week's topic in The Economist." *) But the bottom line is that nobody, nowhere, has ever been able to forecast the world economy in any useful way.

"The only function of economic forecasting is to make astrology look respectable.Ē Often attributed to John Kenneth Galbraith but apparently actually from Ezra Solomon, a member of the Council of Economic Advisors during the Nixon administration.

*https://www.economist.com/weeklyedition/2020-07-25
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