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I am working on the advice given so far.
Can I retire early before age 60?
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I am working on the advice given so far.
jollystomper
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I'll put it this way
. I strove for a 100% success rate in FireCALC with annual expenses retirement expense starting at a minimum of $125-$130K (including taxes) to 100 years old (HA!) projection, and was able to achieve above that, in my situation (which may not be fully applicable to yours, which is why the recommendations to use the tools for you own), with 3 sources of income: pension, savings/investments, and (future, not taken yet) SS. When I reached that goal, I was comfortable to retire, though I did have a "glide path" for a couple of years after that, you can peruse it here at https://www.early-retirement.org/forums/f28/omy-glide-path-plans-81406.html). You can also, if interested, read my 3 year post-retirement summary at https://www.early-retirement.org/fo...f-retirement-after-the-glide-path-109967.html
As I mentioned above, continue to do what you are doing - I am a better saver than an investor, so I always believe saving is primary - keep it simple, use the tools to ensure you are staying on track, and you will be fine
.F.I.R.E User
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I'll put it this way
When I reached that goal, I was comfortable to retire, though I did have a "glide path" for a couple of years after that, you can peruse it here at https://www.early-retirement.org/forums/f28/omy-glide-path-plans-81406.html). You can also, if interested, read my 3 year post-retirement summary at https://www.early-retirement.org/fo...f-retirement-after-the-glide-path-109967.html
As I mentioned above, continue to do what you are doing - I am a better saver than an investor, so I always believe saving is primary - keep it simple, use the tools to ensure you are staying on track, and you will be fine
If FireCalc says 90% success rate. That’s pretty good too right? What if you live pass 100? I will not get pension. When do you plan to get SS?
jollystomper
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It is as good as the risk you are willing to take
. I wanted to see what the 100% success line gave me, others will consider a different rate. There is not a "right" answer.I currently plan to get SS sometime between 65 and 70. This is something FireCALC lets you model to see the difference in ones projections (of course there are other more detailed models for SS such as opensocialsecurity.com). The major factor in my case maximizing SS for my DW in the likely event that I die first. A minor factor is not taking it gives me more room for any tIRA->Roth conversions I choose to do. The impact on our spending is a very minor consideration. These are all very specific situations and there have been a plethora of threads here "debating"
when to take SS and on tIRA->Roth conversions.
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F.I.R.E User
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It is as good as the risk you are willing to take
I currently plan to get SS sometime between 65 and 70. This is something FireCALC lets you model to see the difference in ones projections (of course there are other more detailed models for SS such as opensocialsecurity.com). The major factor in my case maximizing SS for my DW in the likely event that I die first. A minor factor is not taking it gives me more room for any tIRA->Roth conversions I choose to do. The impact on our spending is a very minor consideration. These are all very specific situations and there have been a plethora of threads here "debating"
Is 100% recommended?
When should I tap into SS? At 70, my SS online account shows $2,543 per month.
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FIRECalc Results:
Following the "95% Rule," from Work Less, Live More, each subsequent annual withdrawal will be the greater of 4% of your previous year's withdrawal, or 3.0% of your current portfolio, with no adjustment for inflation (unlike the normal FIRECalc behavior, which uses your starting portfolio, and makes adjustments for inflation). Although the calculations are based on unadjusted withdrawals, the charted withdrawals are shown using 2021 dollars.
Because you indicated a future retirement date (2038), the withdrawals won't start until that year. Your contributions will continue until then. The tested period is 17 years of preretirement plus 13 years of retirement, or 30 years.
FIRECalc looked at the 121 possible 30 year periods in the available data, starting with a portfolio of $2,000,000 and spending your specified amounts each year thereafter.
Here is how your portfolio would have fared in each of the 121 cycles. The lowest and highest portfolio balance at the end of your retirement was $2,000,000 to $25,413,787, with an average at the end of $11,115,766. (Note: this is looking at all the possible periods; values are in terms of the dollars as of the beginning of the retirement period for each cycle.)
So I could expire with an average portfolio of over $11M at age 90?
Following the "95% Rule," from Work Less, Live More, each subsequent annual withdrawal will be the greater of 4% of your previous year's withdrawal, or 3.0% of your current portfolio, with no adjustment for inflation (unlike the normal FIRECalc behavior, which uses your starting portfolio, and makes adjustments for inflation). Although the calculations are based on unadjusted withdrawals, the charted withdrawals are shown using 2021 dollars.
Because you indicated a future retirement date (2038), the withdrawals won't start until that year. Your contributions will continue until then. The tested period is 17 years of preretirement plus 13 years of retirement, or 30 years.
FIRECalc looked at the 121 possible 30 year periods in the available data, starting with a portfolio of $2,000,000 and spending your specified amounts each year thereafter.
Here is how your portfolio would have fared in each of the 121 cycles. The lowest and highest portfolio balance at the end of your retirement was $2,000,000 to $25,413,787, with an average at the end of $11,115,766. (Note: this is looking at all the possible periods; values are in terms of the dollars as of the beginning of the retirement period for each cycle.)
So I could expire with an average portfolio of over $11M at age 90?
Yes. And your results show no failures in any of the runs. So the next thing to do is to go to the "investigate" tab and choose "spending level" for 95% success rate and rerun the program. That will give you an idea of how much more you could spend and still have excellent success. Lastly you could just run your case for retiring earlier than you have planned and see if you need to continue working so long. Those are things running your own numbers can do for you. Enjoy the tool and get what you can out of it.
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I did use the 95% option. It is kinda complicated.
No it's not complicated. And no you didn't run a case to determine acceptable expenses for a 95% success rate. You really need to spend more time reading comments closer, reading the program help comments more and playing with your numbers. I am out again.
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F.I.R.E User
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I checked the box about 95% on the last tab.
jollystomper
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Then after selecting that option on the "investigate" tab and clicking Submit, you should get a graph similar to the attached pic:
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jollystomper
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1000%, or any percent, is a personal choice based on how one chooses to play the "odds".
Same with SS. The tools I mentioned can show you the impact of taking SS at different ages to your final results for spending and your portfolio.
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I did see this graph but I was confused what to look for.
F.I.R.E User
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Got it.
F.I.R.E User
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I spoke to a scheduled appointment Fidelity rep today and he said that I should be 70/30 portfolio 12 years from retirement.
REWahoo
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Sounds reasonable.
Based on your history on E-R.org I think spending time talking with a Fidelity rep will be a much better use of your time than posting questions here.
Dtail
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Most folks who use Firecalc typically look for a 95 to 100% success rate including some folks who are not satisfied until spending is 150/200% of the 100% success rate.
Again these results are based on history and don't guarantee any future success.
Another way I personally look at it is I wanted a 100% success rate, so as to conceptually being able to survive the 6 worst starting period retirements. This includes the stagflation period of 1966 onward and the 1929 great depression.
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F.I.R.E User
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Another rep may have different opinion though.
REWahoo
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I think it’s good to get different exposures.
Dtail
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There is no true minimum success rate. Just mentioning that many use 95% as the minimum.
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Got it.
What did your Edward Jones rep say?
jollystomper
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Horizontal axis is annual spending. Vertical axis is odds of success. Blue line shows odds of success at that level of spending, based on the input data you provided. For example, in that sample graph, 30,286 annual spending (horizontal axis) is predicted to have 95% success rate of lasting the retirement period. 33,314 annual spending will have 85% chance of success, etc.
