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Old 08-28-2017, 02:36 PM   #121
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Originally Posted by flyingaway View Post
Since we are talking about safety nets, I would like to build something NOW to avoid being working at Walmart in my 70s, e.g., working one more year now is probably worth 5 to 10 years later at Walmart in my 70s.
Then you have your answer. Work 3-6 more years. you buy 15-30 years safety. I wouldnt do it, Id wait for the trouble to hit, I already wasted too much time working.
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Old 08-28-2017, 03:27 PM   #122
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Originally Posted by kcowan View Post
We could reduce our quantity of wine.

Not the wine. Anything but the wine.
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Old 08-28-2017, 04:13 PM   #123
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We are new to retirement (end of july, at 57/56), so discount accordingly. (FWIW, no desire/need to leave money to kids in lieu of spending it ourselves.)

Our buffers:
1. over half of our projected spending is purely discretionary travel and dining/entertainment (planning on being able to spend 2.175% of then-valued portfolio, recalculated at 6 month intervals; no pensions or healthcare). Our planned retirement spending very easily exceeds our "when-working" after-tax spending.

2. We continue to count Social as zero, as we have from the 1980s, but if we draw at 70, under present law we will be receiving over 70K a year.

3. We don't include house and associated acreage in our portfolio, but developers are interested and we could buy a fine place for 1/2 of the like net proceeds from any sale.

4. We don't include any hypothetical inheritances in our calculations.

5. We are maintaining our professional privileges for 2018 and maybe 2019--and we could always reup if needed.
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Old 08-28-2017, 05:37 PM   #124
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Our back-up plans (safety nets) are similar to those already mentioned, with one additional possibility...a SPIA. I've listed ours below, in expected order of use as necessary.

[Note: I know SPIAs are a controversial subject on our forum with fans & foes so, let's not repeat that debate here.]

BackUp Plans

A. Use cash buffer: We keep 3-5 yrs in CD/bond ladder
B. Cut expenses: We have three budgets - optimum, median & bare bones
C. Do consulting work: An option for me for a few more years
D. Sell rental house: Essentially trading current income for a big chunk of cash
E. Take SS earlier: We currently plan to defer to 70.
F. SPIA: Buy a single premium fixed annuity (SPIA) to help cover "essential" expenses. Use Fullmer's "annuitization hurdle" concept or Otar's "zone" concept to guide any annuity purchases.
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