ER / LBYM essay

[Htown Harry]

I enjoyed reading this short essay / article. The author would fit in just fine 'round here.

Yes, You Can Retire: One Investor's Contrarian Perspective - Seeking Alpha

Excerpt:

I became my own "expert" spurred by the fear that most of the "real experts" instilled in me. I retired without having anything near the amount that many of them said I MUST have (or else I would be doomed!). Some of the numbers were ridiculous to me, and simply not possible the way I lived my lifestyle.

I found out that ANYONE who decides that they want to retire, can. You can, we can... and by keeping your eye on ONE area, you can figure out how you will retire.

The thing to focus on is how much you spend, and how much you will be able to reduce that spending, so that no matter what you savings accounts look like, you do not have to work forever.

He recommends "Die Broke" written by Pollan and Levine. In a quick search, I didn't find that title mentioned here on the forum. Any fans?

[FIREd]

Sounds like a good pep talk, but it's a little bit light on details. How much did he retire with, how much does he spend per year, and what/how much is that "other income"?

[Helen]

Quote:

I also see absolutely no reason to avoid spending down my savings for anything I want on a regular basis, and winding up with ZERO by the time I am no longer among the living.

I'd like to know how to time that.

[chinaco]

Thanks for the link.

It would not surprise me if that authors is a member of this forum.

He describes how he came to grips with his circumstances. I think his experience about assessing his circumstances, what is important, and his future is what many people on this forum have in common.

There was a book plug at the bottom of the article... got me interested... I will read it.

[rescueme]

Quote:

Originally Posted by Helen I'd like to know how to time that.

+1.

Again, it's the emotion of not leaving anything on the table that drives some folks to overplan/track, IMHO. Kind of like those that wish to "ensure" they get every dollar they paid into SS, chasing that elusive "payback date".

As for me? I would rather die with money than live without it. If there is anything left, who cares (I sure won't ). Money is for the living, not the dead...

[Amethyst]

Harry - Thanks for posting the article. I had not heard of "Seeking Alpha" before, and have bookmarked the site.

Amethyst

[donheff]

Quote:

There was a book plug at the bottom of the article... got me interested... I will read it.

Hard to understand why he loves and lives by Die Broke since the post says he retired. I looked up Die Broke on Amazon and the review includes the following:

Die Broke is organized into two sections: the first lays out the principles for dying broke. Pollan bases his whole argument on these four maxims: quit today and work for yourself, not your company; pay cash, melt your credit cards, and don't even think about using your ATM card; don't retire, retirement is a relatively new concept created during the Depression, instead plan to work all your life, and; die broke, after all, you can't take it with you.
The second part looks at specific instances of how to put this philosophy into action, covering everything from "Automated Teller Machines and Cards" and "Umbrella Liability Insurance" to "Mortgage Loans" and "Real Estate Investment Trusts." The book draws on Pollan's experience as a financial and legal consultant and includes many examples from his own practice.

Not exactly a philosophy people on this board would embrace.

[Closet_Gamer]

I know I'm preaching to the choir, but for folks good at LBYM, most of the retirement planning advice is nonsense. The "80% of pre-retirement income" schtick makes zero sense if, in fact, you already live on 50% of your pre-retirement income. Meanwhile, they do a miserable job of really talking about expenses that are coming our way...notably, healthcare.

The whole thing is predicated on the disfunctional life view that income is the sole driving force in everyone's life. Don't get me wrong, income is key and I've worked hard/taken a lot of risk to drive mine up, but its such a sole fixation for people that its counter-productive.

Income is arguably the place where you have the least control/certainty...You can lose your job, demand for your company's product can dry up, company's can default on their bonds, the government can suddenly realize that its insolvent and whack social security. Its a scary world out there.

Expenses though, are primarily in your own control. Lightning bolts in the form of emergencies can and will, of course, come your way...but those can mostly be hedged/covered with proper insurance.

And since our government takes $0.50 on the $1 in taxes, cutting a dollar of spending is a two-for-one deal vs. getting a dollar of new income. I've seen people who spend piles of money on cars, financial advisors, etc who will then move across the country for a $10K raise...really, uproot the family for net $5K per year? Stop leasing the 2nd SUV and your there pal.

Between a high income and low cost structure, I'll take the low cost structure everyday.

Of course, ideally...let's have both

[Ed_The_Gypsy]

Buy an annuity.

[haha]

Quote:

Originally Posted by Helen I'd like to know how to time that.

Hemlock.

[jdw_fire]

Quote:

Originally Posted by Helen I'd like to know how to time that.

i read the book quite a while ago so i maybe a little off but as i remember it the way to "die broke" was to buy annuities in a laddered way to protect against inflation.