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06-06-2017, 05:08 AM
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#21
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gone traveling
Join Date: Mar 2015
Posts: 3,508
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Quote:
Originally Posted by Enuff2Eat
Wow... is it really possible? too many people keep telling me that I will out live your money. if you are retired, please share your thoughts.
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It's entirely possible.
It all depends on how much you receive from Social Security, Pensions, and Investment Income compared to your Expenses.
I've run the numbers for myself and expect that the combination of Social Security and Investment Income (I don't get a Pension) will exceed my Expenses. Unless I decide to spend more than the inflation-adjusted $100k per year currently planned, I'll die with more money than I have now.
You could run your own numbers using your own assumptions and find out for yourself.
Remember that the focus of this site is Early Retirement, so folks here may not be representative of the population as a whole. It's all about the numbers - some people have them, some don't.
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06-06-2017, 05:24 AM
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#22
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Aug 2013
Location: Texas
Posts: 10,931
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Only pension here is SS and I certainly don't practice LBYM. I've been retired 5 years now and my NW has increased by a little over 15% (not inflation adjusted) with very little of that coming from the market. Don't ask me how!
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06-06-2017, 05:31 AM
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#23
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Thinks s/he gets paid by the post
Join Date: Feb 2014
Posts: 3,083
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NW is higher than when I ERd 2.75 years ago.
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06-06-2017, 05:37 AM
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#24
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Mar 2011
Posts: 8,411
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We had a recent thread where "most" retirees (I forget the actual numbers) with a 4% withdrawal die with more than double what they started with.
__________________
Living well is the best revenge!
Retired @ 52 in 2005
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06-06-2017, 05:42 AM
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#25
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Jan 2006
Location: Rio Grande Valley
Posts: 38,140
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Quote:
Originally Posted by audreyh1
For us, since the start of 20132012, net worth has grown over 40%, and is still up 33% after inflation.
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typo
__________________
Retired since summer 1999.
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06-06-2017, 05:53 AM
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#26
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: May 2014
Posts: 7,373
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I'm up 6% 3 years after retirement; it would have been more but we had an expensive downsizing 2 years ago. (More $$ than expected to fix things in the old house and make the changes we wanted to the new house.)
It should work that way if you want to keep pace with inflation and withdraw larger annual amounts as the purchasing power of your money decreases; my goal has always been to keep the withdrawal % less than the average investment return each year.
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06-06-2017, 05:54 AM
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#27
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Nov 2010
Location: Sarasota, FL & Vermont
Posts: 36,364
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Actually, now that I think of it, it is probably more likely than not that one's retirement assets will grow because SWR's are based on pessimistic cases so one doesn't run out of money if returns are adverse.... if returns are even normal, then it is likely that you assets will grow. The historical return for a 60/40 portfolio is about 8%... so even if future returns are lower and only 6%... with a 4% WR the investments will be growing 2% annually.... and returns over the last 5 years have been good.
__________________
If something cannot endure laughter.... it cannot endure.
Patience is the art of concealing your impatience.
Slow and steady wins the race.
Retired Jan 2012 at age 56
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06-06-2017, 06:15 AM
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#28
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Feb 2005
Location: Central MS/Orange Beach, AL
Posts: 9,072
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I'm ahead too. Not as much as some here as I have a very conservative AA. Just started collecting SS so that should help even more. No pension. Got some things I want to do with my condo and new furniture to buy for my home so plan to spend a little more over the next couple of years.
__________________
Retired 3/31/2007@52
Investing style: Full time wuss.
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06-06-2017, 06:28 AM
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#29
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gone traveling
Join Date: Mar 2015
Location: Greenville
Posts: 653
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Quote:
Originally Posted by Dawg52
I'm ahead too. Not as much as some here as I have a very conservative AA. Just started collecting SS so that should help even more. No pension. Got some things I want to do with my condo and new furniture to buy for my home so plan to spend a little more over the next couple of years.
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If you don't mind stating it, what do you consider a conservative AA?
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06-06-2017, 06:32 AM
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#30
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Jan 2006
Location: Rio Grande Valley
Posts: 38,140
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Quote:
Originally Posted by pb4uski
Actually, now that I think of it, it is probably more likely than not that one's retirement assets will grow because SWR's are based on pessimistic cases so one doesn't run out of money if returns are adverse.... if returns are even normal, then it is likely that you assets will grow. The historical return for a 60/40 portfolio is about 8%... so even if future returns are lower and only 6%... with a 4% WR the investments will be growing 2% annually.... and returns over the last 5 years have been good.
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Of course. The average terminal values for 4% withdrawal rate for 30 years is quite high.
__________________
Retired since summer 1999.
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06-06-2017, 06:37 AM
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#31
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Nov 2016
Posts: 9,515
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Only being a ER for one year I can see this being very common. My portfolio is up 11% in one year and that is minus all of our expenses etc.
Everyone has a different approach and how they handle their money but if you plan for it I do believe it is very common to have more in the end then what you started with.
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06-06-2017, 06:37 AM
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#32
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Thinks s/he gets paid by the post
Join Date: Dec 2009
Location: Alberta/Ontario/ Arizona
Posts: 3,393
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Entirely possible and even likely given the strong markets since 2009. Depending on your asset mix and as long as you have a reasonable WR you will almost certainly have more now than in 2009. I retired in 2006 ( a particularly bad time) but even then have a lot more now than when I started. Have started to "up the spending a bit" to prevent being the "the richest guy in the graveyard". Even then I suspect we will never deplete the portfolio much below its current level.
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06-06-2017, 06:44 AM
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#33
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Dec 2014
Location: Huntsville, AL/Helen, GA
Posts: 6,002
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After 8 1/2 years ER, I'm up just over 30% in my 401K--despite making normal withdrawals in 6 of those years.
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06-06-2017, 06:56 AM
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#34
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Thinks s/he gets paid by the post
Join Date: Sep 2006
Posts: 1,743
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Quote:
Originally Posted by DrRoy
+1. I have a modest pension and only need 2% WR or less after that. If my annual return is over 2% then my assets grow. I am thinking about more expensive travel.
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Your annual return needs to grow in real terms by 2% plus the rate of inflation which as of last month was 2.2%.
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Assets Depleting after Retired
06-06-2017, 06:58 AM
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#35
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Full time employment: Posting here.
Join Date: Jun 2017
Posts: 504
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Assets Depleting after Retired
Something to consider. If you plan your SWR on 100% success and retire with 100x then 10 years later because of bull market now have 150x - you should be able to use the same SWR% on the appreciated assets because your worst case scenario is you withdrawing at the peak before an extended downturn. You can essentially always use the highest number to support you SWR and increase it by the greater of inflation or appreciation.
If you have less than 100% SWR then you should recalculate your failure rate at the new SWR (same $ withdrawal but higher balance) looking at current portfolio balance.
The date you retired has no impact when looking at your portfolio and future SWR.
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06-06-2017, 06:58 AM
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#36
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Sep 2005
Location: Northern IL
Posts: 26,888
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Quote:
Originally Posted by Enuff2Eat
... I saw a friend whom retired 3-4 years ago. To my surprise, he told me that his assets actually INCREASED since he retired.
why? how? I don't believe it. ...
Wow... is it really possible?
...if you are retired, please share your thoughts.
enuff
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My thoughts are: It's hard for me to believe you've been on this forum since 2005, and would ask this.
Of course it is possible to have assets increase in retirement. As other's have pointed out - it is more than 'possible,' it is likely.
Many people here mis-characterize the 4% WR as 'spending down all your money'. But that happens in only ~ 5 % of the cases, many cases end up with more, often far more, at the end.
-ERD50
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06-06-2017, 07:25 AM
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#37
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Recycles dryer sheets
Join Date: Aug 2013
Posts: 275
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Only been retired for 4 years. My nest egg has increased 13% and our WR has average around 2.5%. My biggest ticket item has been a new (used) car. My current ER plan shows us dying with ~50% initial net egg (today $). I use this as a buffer since we have a 44 year plan. Do not start seeing significant decreases in net egg until I hit 72 and start paying higher taxes on RMD and ever increasing heathcare costs. Our other buffer is assuming no SS. I will probably increase spending at 62 once I know what our SS benefits will "actually" be.
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06-06-2017, 07:31 AM
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#38
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Thinks s/he gets paid by the post
Join Date: Jul 2012
Location: Texas
Posts: 3,024
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I retired 4 years ago in 2013. We both have modest pensions and a small amount of rental income. Withdrawal rate after that is 1.9%, which is easily covered by dividends, so we haven't actually sold any shares yet. This is all pre-SS. Portfolio is up 30% since I retired, excluding rentals and main home. I guess one way to look at this: I could withstand a 30% drop in the market and still have the same portfolio value I started with. I'll need to remind myself of that at the time.
__________________
Retired at 52 in July 2013. On to better things...
AA: 85/15 WR: 2.7% SI: 2 pensions, SS later
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06-06-2017, 07:32 AM
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#39
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Thinks s/he gets paid by the post
Join Date: Apr 2016
Location: Ex-Cali
Posts: 1,245
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I would say if you retired in the last 5, or so, years your assets should be up. I would be concerned if they weren't. Most sectors have performed very well.
__________________
______________________
The plan was September 1, 2022 and I am 95% there. Still working a few hours a week at the real job.
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06-06-2017, 07:44 AM
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#40
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Recycles dryer sheets
Join Date: Aug 2013
Posts: 275
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Quote:
Originally Posted by CaliKid
I would say if you retired in the last 5, or so, years your assets should be up. I would be concerned if they weren't. Most sectors have performed very well.
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Yep.. as a newbie at ER I will not spend more just because our nest egg is higher than plan. All is takes is a bear market to bring things back.
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