Puppy Belly
Dryer sheet aficionado
- Joined
- Jan 20, 2008
- Messages
- 46
Excuse the rush to post without proper introduction. Bad form but I need advice badly.
Almost 60, retired 1 Jan, renters for life, frugal, no heirs, and want to set something very straight forward and safe so that the wife doesn't have to ever understand Mr. Market or have to flog herself on the streets.
I'm considering this CD ladder approach within Ray Lucia's Bucket Theory but modified to a 2 Bucket Plan as Rich_in_Tampa mused about in a previous thread. Hope neither Ray nor Rich feel offended at being mentioned here.
Need $65K income inflated at 4% yearly to age 92.
Taxable Account: (Bucket 1)
100k MM (3.7%) Slush/Emergency and first supplement source.
300k 3 Year CD (4.7%) Use interest income first, at maturity start taking incremental principle amts and diminishing yearly interest income.
300k 7 Year CD (4.8%) Same as above.
300k 15 Year CD (5.1%) Same as above.
The gist being: As expenses increase the interest alone is not sufficient so drawdown of principle starts and the account depletes to $300k at age 80.
IRA Account: (Bucket 2)
100,000,000 20 Year CD (5.5%) At age 62.5, this account's interest begins to be siphoned off at only 2% with the remaining DRIPed and compounding at 5.5.
My spreadsheets show a residual of $1,300,000 remaining at age 92.
Question is for everyone: Other than the ever-present inflation risk, does this plan seem risky??
PS: We could easily LBYM if required.
Almost 60, retired 1 Jan, renters for life, frugal, no heirs, and want to set something very straight forward and safe so that the wife doesn't have to ever understand Mr. Market or have to flog herself on the streets.
I'm considering this CD ladder approach within Ray Lucia's Bucket Theory but modified to a 2 Bucket Plan as Rich_in_Tampa mused about in a previous thread. Hope neither Ray nor Rich feel offended at being mentioned here.
Need $65K income inflated at 4% yearly to age 92.
Taxable Account: (Bucket 1)
100k MM (3.7%) Slush/Emergency and first supplement source.
300k 3 Year CD (4.7%) Use interest income first, at maturity start taking incremental principle amts and diminishing yearly interest income.
300k 7 Year CD (4.8%) Same as above.
300k 15 Year CD (5.1%) Same as above.
The gist being: As expenses increase the interest alone is not sufficient so drawdown of principle starts and the account depletes to $300k at age 80.
IRA Account: (Bucket 2)
100,000,000 20 Year CD (5.5%) At age 62.5, this account's interest begins to be siphoned off at only 2% with the remaining DRIPed and compounding at 5.5.
My spreadsheets show a residual of $1,300,000 remaining at age 92.
Question is for everyone: Other than the ever-present inflation risk, does this plan seem risky??
PS: We could easily LBYM if required.