2008 was a great year to retire

[kcowan]

I retired in 2002 so 2007 was simply a blip. Did not sell anything. I was glad of my emergency fund.

 

[yakers]

Retired in March 2008 @ 57, DW retired Jun 06 @58. All has gone well financially, thanks to the long upward market.
Work was great but retirement is better

 

[Mr. Tightwad]

Stopped going to work on 3/1/2008.

It's been a good 13 years.

 

[Lakedog]

Retired March 28, 2008. Fairly wild ride in the market that first year or so but current investments are almost 2.5 times the value at retirement. The last 13 years have been good but have gone by quickly.

 

[6miths]

It would seem that 2009 and 2010 and 2011 and... were also good years to retire.

 

[DawgMan]

These kinds of stories are reassuring to those of us just getting our wings. Clearly, the overall message is to stay the course, don't panic, stay agile. Not to be Debbie Downer, but I think it would be just as interesting/helpful to hear some stories from those who maybe did panic and sell (at least for a while before getting back in), went back to work for __ yrs, and ate frozen pizza for 2 yrs, before getting back on track. While in hindsight I am sure some of the lessons were obvious, if you did hit the panic button (which would have been totally understandable), what did you do to bounce back and are you at peace today with your retirement and portfolio balance? Do tell (assuming you are still out there?)!

 

[kcowan]

I wonder how many here have come to depend on equity returns being earned recently.

We used 8% in 2002 and have revised it to 6% two years ago. Because our SWR was only 1.8% in 2019, we have entered our Blow That Dough phase, buying a new luxury condo and furnishing it well. Because it was pre-construction, it is going up in value too.

 

[DrRoy]

I wonder how many here have come to depend on equity returns being earned recently.

We used 8% in 2002 and have revised it to 6% two years ago. Because our SWR was only 1.8% in 2019, we have entered our Blow That Dough phase, buying a new luxury condo and furnishing it well.

We are not depending on the great recent returns, but we are using them to remodel the house. Even with that, we only needed 2.4% WD this year (plus a small pension). With no remodeling, it would be 1.8%.

 

[Andre1969]

A few years back, I did a little exercise, to see how my portfolio would have held up if I had retired on 12/31/07, and had to start relying on it, using my actual portfolio returns over the years. While 2008 was a bad year, the recovery was so fast, and everything since then was smooth sailing, so I quit updating it at the end of 2017. And, while 2018 ended up down a bit, 2019 was a great year, and despite the COVID fiasco, 2020 was good as well. So chances are, I'd still be fine even now. I ran scenarios with a 3%, 4%, 4.5%, and even a 5% withdrawal rate. Even at 5%, if I had started with $1M on 12/31/99, I would have ended up with around $994K on 12/31/17.

I also ran "what if" numbers, presuming I retired on 12/31/99. That scenario is definitely shakier, and I carried this one out through 12/31/20. At 3%, that $1M would be at around $917K. But at 4%, I'd be down to around $150K, and definitely on track for failure within the next couple years.

Now, there are a few flaws in my calculation, though. First, if I had been close to retiring, I probably wouldn't have had my portfolio invested nearly as risky. Also, at some point, SS would have been kicking in.

I have a feeling that retiring in 1999 is probably one of the roughest cycles in recent memory, but even it wouldn't have been a total disaster, if you had planned wisely.

 

[street]

^ that study you did was very interesting and shows and gives strength in the stay or course philosophy. It also shows if we can adjust spending on the go while in down times we should be able to survive the down turns in markets.

Thanks

 

[N02L84ER]

DH retired in 11/2005 at age 45 and I semi-retired. I worked very part time and earned an average of $10K/yr for the next 2 years. Our gross WRs would have been 6.5% and 5.4% but after accounting for my wages they were 5.4% and 4.5%. We were 16+ years from collecting SS and have no pensions but thought we could still pull it off. I never posted our information on this forum back then because I knew everyone would tell me our plan would fail. Then the Great Recession happened. Luckily, the company where I was doing contract work offered me more hours in 2008 and I earned an average of $42,700/yr over the next four years. I did also refinance our 15 yr mortgage to 30 yrs in order to drop that monthly nut from $2100 to $800 in 2009. I retired in 2012. Our WR last year was 1.7%. SORR was scary, but now we are definitely good to go.