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Old 05-29-2017, 07:23 PM   #101
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There is a wide gap between what is acceptable and what is desirable.

A burger on the barbie is acceptable but an occasional wagyu on the barbie is desirable -
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Old 05-29-2017, 07:25 PM   #102
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Originally Posted by joeea View Post
Back when your parents retired, they probably had one or more pensions, social security and other savings. That used to be called the three-legged stool of retirement. Those days are gone for many.

And I think you have confused the tenets of the rule. I don't believe the rule as you wrote it makes any sense. If it did, then those who get little to nothing from Social Security need save little to nothing.

And I can't imagine such a rule was ever applied to someone wishing to retire at 50.
Obviously, it assumes a full career of work covered by Social Security, and in the case of my father, retirement at 65 followed by some years of seasonal, part-time work.
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Old 05-29-2017, 07:25 PM   #103
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On MMM they sell their car and ride a bike or use public transportation. If they fly, it is probably free from some sort of credit card bonus signup thing they worked up.

On Bogleheads they don't fly first class, they charter a jet.

ER.org is usually a happy place between those two but sometimes seems to disparage someone who claims they can live comfortably a lowish amount.

I posted our possible budget not to say that is how we are going to live but to point out how cheap it can be to live (aside from health insurance, which right now IS cheap if you can manage low income....might not stay that way).

For the person who asked, we spent about $58k for the 28 acres. Eastern Washington is just silly cheap compared to the west part. Our forester even said we should log the lodgepole (leave the larch and fir) and get back about $8k!
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Old 05-29-2017, 07:41 PM   #104
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According to the Schwab annuity calculator here:
Income Annuity Estimator: Calculate Your Payout | Charles Schwab
a male in California who puts 600K into an SPIA on his 50th birthday today will receive monthly payments of 3781 for 15-year certain and 3087 for 20-year certain, so the 17-year payout would presumably be around 3500 per month. No inflation protection, but beneficiaries receive any remaining income payments until the end of the period.
Except NO inflation?? really is that feasible over 17 years to live with zero inflation? Again I repeat, not doable...and your still not making up that extra $400/month at the start.
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Old 05-29-2017, 07:49 PM   #105
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Ideally I would love to have a 2-3M portfolio so that I could simply live off interest and keep my capital intact and feel secure for the rest of my life. But that is not achievable for most. In that case, the other option is to save whatever I can and live on that by 1) moving to a low COL area 2) not owning a home (to avoid unexpected expenses in repairs and to use that home equity to invest) 3) not spending too much on entertainment and buying stuff that's not necessary

- Sam
The bold is interesting. I think I've seen lots of posts here that say planning for retirement includes owning a paid for home. I recall very few that say the right strategy is to rent.

Maybe it's a generational thing. I think I'll look for a poll.
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Old 05-29-2017, 07:58 PM   #106
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There is a wide gap between what is acceptable and what is desirable.

A burger on the barbie is acceptable but an occasional wagyu on the barbie is desirable -


How true! I suppose if we had been willing to leave where we want to live, stop going out to nice restaurants, and give up travel to exotic SCUBA destinations, we could've retired much sooner. We chose to continue working until we could afford to continue a lifestyle we think is desirable, plus have extra for the uncertainties.
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Old 05-29-2017, 08:32 PM   #107
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How true! I suppose if we had been willing to leave where we want to live, stop going out to nice restaurants, and give up travel to exotic SCUBA destinations, we could've retired much sooner. We chose to continue working until we could afford to continue a lifestyle we think is desirable, plus have extra for the uncertainties.
+1
But to each his own. I'd need triple the OP's income to live how I want to spend the rest of my life. And life is good now
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Old 05-29-2017, 08:36 PM   #108
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But OP doesn't want that kind of lifestyle, he wants bare minimum. But even then I don't think he has factored in inflation. Plus he has two kids. Others who can live in an RV may not have kids.
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Old 05-29-2017, 08:36 PM   #109
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I know there are a lot of well off people on this site, but it surprises me that so many think that $3900 a month is undoable. Millions of people live very comfortably on less than that.
I agree 100% that millions live on a lot less and live comfortable. My budget for the year is $35000 and we live with everything we need. It comes to $2900 a month for us to live. There are many that live on less then that.
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Old 05-29-2017, 08:48 PM   #110
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Ya know, I'm starting to think if we need a subsection on ER for those of us who don't think we need over 1.5M to live a good life. Personally I think if you have a paid for house and live in a LCOLA and you want to retire around 50-55:

1. One can survive on $600k
2. $1M is a decent lower-end target
3. $1.2M is comfortable
4. $1.5M is plenty

Anything above is gravy though I wouldn't bust my behind to get there. You only get one life to live.
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Old 05-29-2017, 08:57 PM   #111
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Ya know, I'm starting to think if we need a subsection on ER for those of us who don't think we need over 1.5M to live a good life. Personally I think if you have a paid for house and live in a LCOLA and you want to retire around 50-55:

1. One can survive on $600k
2. $1M is a decent lower-end target
3. $1.2M is comfortable
4. $1.5M is plenty

Anything above is gravy though I wouldn't bust my behind to get there. You only get one life to live.


I don't think most of us are saying the OP needs over $1.5M. $600K though is a bit light to retire so early.
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Old 05-29-2017, 09:02 PM   #112
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.....My intention is to come up with a reasonable number that actually works. 3900 per month is shocking for a few here. So many others felt that is a reasonable amount for a family of two (no kids) to live on. I agree about healthcare costs, the uncertainty of market and unexpected expenses. So may be 800K sounds like a more reasonable one then to retire at 50? ...
According to Firecalc, you would need $862k to retire at age 50 spending $46,800/year assuming that you start SS at age 67 and receive that amount each year... this would give you a 95% chance of not running out of money before age 95. Assumes 60/40 AA and all other assumptions default assumptions.

However, as previously mentioned the big risk would be if one person dies early and 1/3 of your SS income goes away. For example, if you started at with $862k at age 50 and one of you dies at 70 your success rate would drop from 95% to 78%.

All of the above assumes that you can live in the lifestyle that you desire for $46,800/year in 2017 dollars.
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Old 05-29-2017, 09:04 PM   #113
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It's all about choices and doing what you want. Doing what you want is more important than doing what you have to do.

If your job sucks so bad you want to just drive though the parking lot and go home each day there is that.

Everyone has to figure it out for themselves. It doesn't make a difference for anyone but you. It's like this "end of career" choice that is just as important as the "choice of career" when we were young.

Life is good -
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Old 05-29-2017, 09:06 PM   #114
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Originally Posted by dvalley View Post
Ya know, I'm starting to think if we need a subsection on ER for those of us who don't think we need over 1.5M to live a good life. Personally I think if you have a paid for house and live in a LCOLA and you want to retire around 50-55:

1. One can survive on $600k
2. $1M is a decent lower-end target
3. $1.2M is comfortable
4. $1.5M is plenty

Anything above is gravy though I wouldn't bust my behind to get there. You only get one life to live.
Your reference is today's money. OP's reference is money 13 years from now. $600k maybe worth less than $400K today.
Can you survive on $400k today. Plus it seems to me you already own a home. I'm not sure OP does.
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Old 05-29-2017, 09:18 PM   #115
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Ya know, I'm starting to think if we need a subsection on ER for those of us who don't think we need over 1.5M to live a good life. Personally I think if you have a paid for house and live in a LCOLA and you want to retire around 50-55:

1. One can survive on $600k
2. $1M is a decent lower-end target
3. $1.2M is comfortable
4. $1.5M is plenty

Anything above is gravy though I wouldn't bust my behind to get there. You only get one life to live.
The OP is 37, married to nonworking wife, has 2 small children and rents. He seems to like posting hypothetical questions like the original post. He mentions retiring at 50 for 2 people with 600k. What happened to the 2 children?
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Old 05-29-2017, 09:31 PM   #116
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I haven't run the numbers but some easy side income could increase the odds of success with the $600K plan - a few thousand $ from Adsense, a few thousand $ each from credit card sign ups, bank bonuses, get paid to apps, etc. and there's an extra $10K a year without an actual job or too much effort, maybe $20K with two people working at it.

We've saved or made a fair bit just following some of the ideas on forums like Fatwallet and Slickdeals. I never really understood the MMM appeal. Many of those ideas seem like a lot of hard, physical work for minimal savings, like making your own yogurt or bread or riding your bike to the grocery store. The grocery stores I can bike to are really expensive. I save much more in food than gas by driving to some place like Costco. We buy bread at Costco for $2 a loaf. If we made it ourselves after accounting for ~.30 kwh energy use and ingredients I don't think our hourly rate would be very high compared to learning the credit card game for free travel or getting a free year's supply of toilet paper and tissues with a store rewards programs.
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Old 05-29-2017, 09:34 PM   #117
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Originally Posted by splitwdw View Post
The OP is 37, married to nonworking wife, has 2 small children and rents. He seems to like posting hypothetical questions like the original post. He mentions retiring at 50 for 2 people with 600k. What happened to the 2 children?
Obviously, the parents kill them early on for the insurance.
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Old 05-29-2017, 09:36 PM   #118
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I don't think most of us are saying the OP needs over $1.5M. $600K though is a bit light to retire so early.
I was referring to those who were saying $3900 a month is not enough money to live comfortably which is actually 4% of 1.17M. So, in other words they are saying 1.17M is not enough to retire early.

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Your reference is today's money. OP's reference is money 13 years from now. $600k maybe worth less than $400K today.
Can you survive on $400k today. Plus it seems to me you already own a home. I'm not sure OP does.
I guess I didn't catch the today's vs. future dollars part, like the return on investment who knows what the inflation rate will be.

Quote:
Originally Posted by splitwdw View Post
The OP is 37, married to nonworking wife, has 2 small children and rents. He seems to like posting hypothetical questions like the original post. He mentions retiring at 50 for 2 people with 600k. What happened to the 2 children?
I think the OP is just trying to see if the shan hits the fit what's the bare min to survive on and for how long. I've asked the same question of myself many times.
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Old 05-29-2017, 09:38 PM   #119
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I don't think the point is if $3900 a month is too little or too much to retire on, it's whether or not the 37-year-old OP's anticipated nest egg of $600K when he turns 50 will generate enough income and slicing away of principal to provide that income until it can be supplemented by SS for the OP and his wife. Several posters here think the nest egg is not big enough to generate the $3900 and have clearly explained why--they don't seem to be arguing that OP can't live on that amount. Plenty of people live on less than $3900; maybe OP just needs to figure out how to live on what the nest egg actually could generate.
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Old 05-30-2017, 04:43 AM   #120
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This forum really demonstrates the wide range of what various people find to be an acceptable lifestyle. YMMV
Yep. And it rubs me the wrong way when I see a thread title like "All you need is ...", as if I'm being told what my acceptable lifestyle should be. That may be part of the reason for some of the other responses too. If the OP wants to live that way, fine by me, though I agree with the points about factoring in inflation.
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