View Poll Results: How much do you live on?
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20-30K per year
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37 |
13.03% |
30-40K per year
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52 |
18.31% |
40-60K per year
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78 |
27.46% |
60-80K per year
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48 |
16.90% |
> 80K per year
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69 |
24.30% |
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11-18-2010, 11:39 AM
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#101
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Thinks s/he gets paid by the post
Join Date: May 2008
Location: Cooksburg,PA
Posts: 1,873
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I am so glad you have taken an interest!
You can read about in my new book: How To Retire On 9 Cents per Day.
Now available at Amazon.com.
Free to canoe
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11-18-2010, 11:46 AM
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#102
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Jun 2002
Location: Texas: No Country for Old Men
Posts: 50,000
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Quote:
Originally Posted by Free To Canoe
You can read about in my new book: How To Retire On 9 Cents per Day.
Now available at Amazon.com.
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Let me guess: You only need to sell three a year to cover your annual living expenses...
__________________
Numbers is hard
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11-18-2010, 11:47 AM
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#103
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Recycles dryer sheets
Join Date: Dec 2009
Posts: 215
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Quote:
Originally Posted by Danmar
Boy am I an outlier on this one.
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Me too Danmar. We scrape by on $140K a year now that the mortgage is paid off. I am always amazed on what people are able to live on. I guess I am disadvantaged by living in the Northeast with a wife who shows horses.
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11-18-2010, 11:49 AM
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#104
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Jun 2002
Location: Texas: No Country for Old Men
Posts: 50,000
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Quote:
Originally Posted by chemist
We scrape by on $140K a year now that the mortgage is paid off. I am always amazed on what people are able to live on. I guess I am disadvantaged by living in the Northeast with a wife who shows horses.
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Wow. What does she show them that costs so dang much?
__________________
Numbers is hard
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11-18-2010, 12:01 PM
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#105
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: May 2005
Location: Lawn chair in Texas
Posts: 14,183
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Been out of the market a while, eh?
__________________
Have Funds, Will Retire
...not doing anything of true substance...
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11-18-2010, 06:59 PM
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#106
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Thinks s/he gets paid by the post
Join Date: Dec 2004
Posts: 1,798
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Quote:
Originally Posted by chemist
Me too Danmar. We scrape by on $140K a year now that the mortgage is paid off. I am always amazed on what people are able to live on. I guess I am disadvantaged by living in the Northeast with a wife who shows horses.
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I'm glad I don't live up there. Even with an expensive mortgage and a kid in private school I don't spend that much.
__________________
You don't want to work. You want to live like a king, but the big bad world don't owe you a thing. Get over it--The Eagles
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11-18-2010, 07:20 PM
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#107
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Jul 2008
Posts: 35,712
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I am happy with our living standard now. It is something I should be able to afford easily, barring the potential stratospheric rise of health care costs. If I have twice the means, I think I can learn to spend more. As I wrote earlier, I don't think that ability would be too difficult to acquire. But if I were to spend twice what I do now, would I be twice as happy? Or half as unhappy as I sometimes find myself to be? I doubt it, but I would spend more as a way to "spread the wealth", in addition to giving more to charity.
__________________
"Old age is the most unexpected of all things that happen to a man" -- Leon Trotsky (1879-1940)
"Those Who Can Make You Believe Absurdities Can Make You Commit Atrocities" - Voltaire (1694-1778)
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11-18-2010, 08:06 PM
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#108
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Apr 2003
Location: Hooverville
Posts: 22,983
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Quote:
Originally Posted by NW-Bound
I doubt it, but I would spend more as a way to "spread the wealth", in addition to giving more to charity.
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You are a wonderfully generous, public spirited man.
Ha
__________________
"As a general rule, the more dangerous or inappropriate a conversation, the more interesting it is."-Scott Adams
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11-18-2010, 09:40 PM
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#109
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Full time employment: Posting here.
Join Date: Apr 2005
Posts: 807
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I guess we're another kind of outlier, living on well under 2K per month for a couple. Only possible 'cause we live full-time in Mexico, albeit in a costly (due to many fellow gringos) area. Doing our best to make it on 3% SWR from a conservatively invested portfolio hard hit by the '08 meltdown - and still a long way from SS, with no pension or megacorp anything.
Health insurance @$600 per year for the two of us, good out-of-pocket care @ about 10 cents on the dollar, we rent rather than own (but property taxes here are ~$200 on a 300K house), food 1/3 of U.S. prices. We'd still prefer low-cost living in the U.S., but the health care and insurance situation and poor job market made this an okay Plan B. Lots of respect to all who have done and planned better.
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11-18-2010, 10:53 PM
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#110
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Thinks s/he gets paid by the post
Join Date: Jul 2009
Posts: 1,934
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Quote:
Originally Posted by kevink
Only possible 'cause we live full-time in Mexico, albeit in a costly (due to many fellow gringos) area.
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kevin, are you in Chapala?
__________________
And if I claim to be a wise man, it surely means that I don't know.
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11-19-2010, 06:30 AM
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#111
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Recycles dryer sheets
Join Date: May 2007
Posts: 213
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I've been watching this poll with interest and what it boils down to is that it doesn't matter what someone else lives on. It matters what you need to live a happy life. The only way to know this is to track every penny you spend for several years. Then add whatever taxes you would pay on top of that, as well as any change in health care costs. Add any travel or hobby costs, subtract commuting or work costs to get your best estimate.
We spend about the same as before retirement, but have swapped out commuting costs for travel and hobby costs. since our health care is increasing 68% this year I am thankful we did so much tracking and built in a healthy cushion.
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11-19-2010, 06:56 AM
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#112
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Nov 2009
Posts: 6,679
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Quote:
Originally Posted by 52andout
I've been watching this poll with interest and what it boils down to is that it doesn't matter what someone else lives on. It matters what you need to live a happy life. The only way to know this is to track every penny you spend for several years. Then add whatever taxes you would pay on top of that, as well as any change in health care costs. Add any travel or hobby costs, subtract commuting or work costs to get your best estimate.
We spend about the same as before retirement, but have swapped out commuting costs for travel and hobby costs. since our health care is increasing 68% this year I am thankful we did so much tracking and built in a healthy cushion.
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I don't track every penny I spend, choosing instead to bundle the smaller ones into broader categories (i.e. I keep track of ATM cash withdrawals but not what I spend the cash on).
When creating my retirement spreadsheet, I noticed that in the expenses part I was for the most part swapping my commutation expenses and SS taxes for added medical (HI) costs. My cash expenses dropped slightly because the cost of expanding my hobbies one night a week was slightly less than the cost of buying lunch when I was working.
Your last point about building in a cushion (i.e. surplus) to my ER budget can't be overstated. This gives me peace of mind in case I have some unforseen expenses, a rise in existing expenses, or an unexpected drop in dividend income.
__________________
Retired in late 2008 at age 45. Cashed in company stock, bought a lot of shares in a big bond fund and am living nicely off its dividends. IRA, SS, and a pension await me at age 60 and later. No kids, no debts.
"I want my money working for me instead of me working for my money!"
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11-19-2010, 09:11 AM
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#113
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Thinks s/he gets paid by the post
Join Date: Mar 2010
Location: Seattle-ish
Posts: 1,156
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Quote:
Originally Posted by 52andout
... The only way to know this is to track every penny you spend for several years. Then add whatever taxes you would pay on top of that, as well as any change in health care costs.
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I am assuming you are referring to income taxes. If not, please ignore the following response.
Why would I need to add income taxes to the calculation of my annual expenses? Apart from interest/dividends that I hope to reap from my nest egg, and the resultant income tax I'll pay on that, such taxes are not an expense to me, particularly since I ER'd and no longer make as much as I did.
Let's pretend I have now looked over my past few years of expenses, figured in the new expense of individual health insurance premiums and other costs, and am predicting $30K annual expenses for the foreseeable future--which does not include any income taxes in my list of expenses. Let's also pretend that whether I plan to work part-time or have only interest/dividends as income, I'll pay taxes only on that extra income. Yet taxes are never 100% or more of income, but are less than a third of that income. In ER, it will be much, much less. Taxes are an expense, if you will, only on income I'll make. But I'll still have [income minus taxes=net $].
In summary, I just do not see the need to figure in income taxes when coming up with my annual expenses.
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11-19-2010, 10:00 AM
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#114
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Mar 2005
Location: Chicago
Posts: 13,148
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Quote:
Originally Posted by Birdie Num Nums
I am assuming you are referring to income taxes. If not, please ignore the following response.
Why would I need to add income taxes to the calculation of my annual expenses? Apart from interest/dividends that I hope to reap from my nest egg, and the resultant income tax I'll pay on that, such taxes are not an expense to me, particularly since I ER'd and no longer make as much as I did.
Let's pretend I have now looked over my past few years of expenses, figured in the new expense of individual health insurance premiums and other costs, and am predicting $30K annual expenses for the foreseeable future--which does not include any income taxes in my list of expenses. Let's also pretend that whether I plan to work part-time or have only interest/dividends as income, I'll pay taxes only on that extra income. Yet taxes are never 100% or more of income, but are less than a third of that income. In ER, it will be much, much less. Taxes are an expense, if you will, only on income I'll make. But I'll still have [income minus taxes=net $].
In summary, I just do not see the need to figure in income taxes when coming up with my annual expenses.
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Makes sense, since you'll have zero TIRA withdrawals, zero 401k/403b withdrawals, zero SS, zero pension, zero interest, divs or cap gains...... just no taxable income. Then, indeed, your expense for income taxes should be zero. Congratulations!
__________________
"I wasn't born blue blood. I was born blue-collar." John Wort Hannam
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11-19-2010, 11:14 AM
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#115
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Thinks s/he gets paid by the post
Join Date: Mar 2010
Location: Seattle-ish
Posts: 1,156
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Quote:
Originally Posted by youbet
Makes sense, since you'll have zero TIRA withdrawals, zero 401k/403b withdrawals, zero SS, zero pension, zero interest, divs or cap gains...... just no taxable income. Then, indeed, your expense for income taxes should be zero. Congratulations!
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On further thought, I wasn't considering the tax-deferred $ I now have in my nest egg. I am so new at ER (since June) that I have not had to consider taking out any tax-deferred $ from my IRAs, 401k, or 403(b)(7) accounts. Once I do take such money, far into the future, then I'll have to figure out the income tax due at that time.
(In the meantime, I also build in a cushion, calculating my yearly expenses then adding a 10% cushion--to predict what I'll need for the coming year.)
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11-19-2010, 11:37 AM
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#116
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Recycles dryer sheets
Join Date: May 2007
Posts: 213
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Quote:
Originally Posted by Birdie Num Nums
In summary, I just do not see the need to figure in income taxes when coming up with my annual expenses.
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actually, that was part of what we figured in, not to say it is applicable to everyone. All of this 401K and IRA money has never been taxed so if you take out say $30,000 per year than you will have to pay tax on that money. Yes it will be way less than what you paid during the accumulating years but nonetheless must be accounted for even if only a few thousand dollars. With almost certainty I can say taxes will rise. Who is going to pay for all this money our government is spending?
When I read these polls I also wonder if the following expenses are included for example:
house repairs (roofs aren't cheap)
auto replacement and repair (I'm willing to drive an old car but not everyone is)
rising health care costs
One of our friends estimated $35,000 per year in retirement which I thought was low considering his lifestyle. Adding in some travel, a car breakdown, taxes and health care it rose to over $50,000 his first year much to his surprise.
It really isn't simple at all. Lots to consider when you are planning.
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11-19-2010, 04:04 PM
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#117
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Jan 2008
Location: NC
Posts: 21,148
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Interesting distribution. Looks bimodal, but probably just a too narrow bin range. Some big spenders here...
__________________
No one agrees with other people's opinions; they merely agree with their own opinions -- expressed by somebody else. Sydney Tremayne
Retired Jun 2011 at age 57
Target AA: 50% equity funds / 45% bonds / 5% cash
Target WR: Approx 1.5% Approx 20% SI (secure income, SS only)
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11-19-2010, 05:38 PM
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#118
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Full time employment: Posting here.
Join Date: Oct 2007
Posts: 798
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Quote:
Originally Posted by Midpack
Interesting distribution. Looks bimodal, but probably just a too narrow bin range. Some big spenders here...
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I would also say some some fairly big earners also. At least I don't think they are spending what they don't have.
I figure that, for us, total taxes will be about 30% even in retirement. That would include all the taxes we pay now except for SS. Since almost everything we have in assets, other than our home, is tax deferred, and we will still have to pay property and sales taxes, I don't see them dropping as a percentage of income, only in dollar amount as our income drops. SS benefits will be fully taxed at 85% as ordinary income. Unless people are able to live off large stashes of already taxed money, I don't understand how their taxes can be 0 or close to it. I may be wrong, but I think many of us use 401Ks, IRAs, I bonds, etc. for our primary savings - all have tax bills coming due when they are withdrawn. It would be nice to have lots of Roth money, but there are income limits and I, for one, don't see much benefit in paying taxes on a conversion now, rather than later when the money is withdrawn.
We try to live within our means, to include maxing out any income deferral opportunities we have as well as charitable giving, but we don't need to be frugal, so we aren't. If we had to be, we would economize. I never really understood being extremely frugal for the sake of it - like the millionaire woman in the late 1800s in NYC who stuffed her coats with newspapers to keep warm rather than buy decent quality clothing. I understand living within your means and only borrowing for major life items. I don't quite get having the money to live well (not outrageously) but being so frugal the nickels beg for mercy .
__________________
Mission accomplished - not necessarily ER, but certainly R.
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11-19-2010, 06:48 PM
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#119
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Jul 2008
Posts: 35,712
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A while back, we talked of a homeless man who left his $4M estate to charity. He was not even what people would call frugal; he simply did not care about money. Strangely, he appeared to be a decent investor.
Richard Leroy Walters: Homeless Millionaire (PHOTO, VIDEO) | Bitten and Bound
PS. Come to think of it, he might just be an average investor. His secret? 0% SWR :-)
__________________
"Old age is the most unexpected of all things that happen to a man" -- Leon Trotsky (1879-1940)
"Those Who Can Make You Believe Absurdities Can Make You Commit Atrocities" - Voltaire (1694-1778)
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11-22-2010, 07:08 PM
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#120
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Full time employment: Posting here.
Join Date: Nov 2010
Posts: 628
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DW and I are in the $30K or slightly more range. We are in a quickly accumulating stage while living on future pension & DW's SS equivalent.
Completely debt free. Mortgage paid, health partly paid by employer, live in a lower cost Midwest state. Roof is a lifetime steel shingle roof. I won't spend time on THAT roof ever again. House was flooded two years ago and is now nearly completely rebuilt. We didn't have flood insurance. BIG mistake!
We enjoy low cost hobbies including DIYs, gardening, cooking, outdoors, hiking, and kayaking. (Sometimes NOT in circles!!!). My goal is for even a bad investment year, a 0-1% draw will be ample to feel extravagant. Later, we can cash in on my SS at a higher rate assuming some is still left.
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