View Poll Results: Which method do you use?
|
Pull method - do draws when running low; monitor WR rate
|
|
55 |
40.15% |
Push method - do draws on a regular basis; monitor balances
|
|
35 |
25.55% |
I like bacon
|
|
47 |
34.31% |
|
|
06-28-2019, 03:03 PM
|
#1
|
Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Jun 2006
Location: Boise
Posts: 7,882
|
Poll: Push or pull?
Just curious about something.
I mentally categorize my financial accounts, as I think most do, into my FIRE stash on the one hand and my day-to-day banking accounts on the other hand. In my case, the former includes my IRAs and a taxable account; the latter include checking, savings, and credit card accounts.
I use what I would call the "pull method": I spend down my cash on hand until it's almost out, then I pull some money from my FIRE stash to replenish it. In other words, I do my draws on an as-needed basis. I then monitor my WR to make sure I'm maintaining in a safe range.
It occurred to me that there could be another style, which I would call the "push method": Calculate a safe WR however you like, then use that to set up a regular draw to push money from FIRE to banking on a regular basis. In other words, do withdrawals regardless of one's banking account balances. In this approach, one would monitor safety simply by monitoring the level of cash in the banking accounts - if there's plenty of cash, then you're safe; if you're running dry then you're overspending your rate.
In my case, I've thought about the push method as maybe encouraging spending more, which might be a solution to my under-spending (I'm at a 1.17% net WR today), because the decision to pull money out at a certain rate would be automatic, rather than waiting until I am running low.
Which do you do? Pros, cons, thoughts?
__________________
"At times the world can seem an unfriendly and sinister place, but believe us when we say there is much more good in it than bad. All you have to do is look hard enough, and what might seem to be a series of unfortunate events, may in fact be the first steps of a journey." Violet Baudelaire.
|
|
|
|
Join the #1 Early Retirement and Financial Independence Forum Today - It's Totally Free!
Are you planning to be financially independent as early as possible so you can live life on your own terms? Discuss successful investing strategies, asset allocation models, tax strategies and other related topics in our online forum community. Our members range from young folks just starting their journey to financial independence, military retirees and even multimillionaires. No matter where you fit in you'll find that Early-Retirement.org is a great community to join. Best of all it's totally FREE!
You are currently viewing our boards as a guest so you have limited access to our community. Please take the time to register and you will gain a lot of great new features including; the ability to participate in discussions, network with our members, see fewer ads, upload photographs, create a retirement blog, send private messages and so much, much more!
|
06-28-2019, 03:11 PM
|
#2
|
Recycles dryer sheets
Join Date: Aug 2018
Location: YUKON,OK
Posts: 255
|
I'm not RE yet but plan to do the push method. Setting up a regular paycheck will just make me feel better. Any unspent money will just go back into savings of some sort.
Coz
|
|
|
06-28-2019, 03:14 PM
|
#3
|
Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Apr 2010
Posts: 5,912
|
I pull out money as needed. Once or twice a year. I move it into my hisa on line account, then transfer it to my current account when I need it.
|
|
|
06-28-2019, 03:17 PM
|
#4
|
Thinks s/he gets paid by the post
Join Date: Oct 2013
Location: Cholula
Posts: 1,595
|
Quote:
Originally Posted by COZICAN
I'm not RE yet but plan to do the push method. Setting up a regular paycheck will just make me feel better. Any unspent money will just go back into savings of some sort.
Coz
|
Our approach. Each month we have an automatic transfer out of IRA's. Any excess ends up in one of our taxable accounts.
__________________
“Before you criticize someone, walk a mile in their shoes. That way, you’ll be a mile from them, and you’ll have their shoes.” – Jack Handey
|
|
|
06-28-2019, 03:18 PM
|
#5
|
Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Nov 2009
Posts: 6,695
|
I don't really use either method the way you describe them. I am closer to the "push" method, though. I have two mutual funds which together generate dividends I automatically take as cash via ACH into my local bank account. I don't know what those amounts will until they are announced that day (such as today, the last business day of the month).
Excess dividends get reinvested somewhere, usually back into my main bond fund. Sometimes, I have to retain excess dividends to cover the lumpier expenses in later months.
__________________
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!"
|
|
|
06-28-2019, 03:21 PM
|
#6
|
Moderator Emeritus
Join Date: Aug 2007
Location: Northern Illinois
Posts: 16,600
|
I do pull - just withdraw when I run low. Primarily because I was operating on cash for the first 3 years of ER, and the past 2 years have been full of remodel projects that needed money on a sporadic basis.
|
|
|
06-28-2019, 03:24 PM
|
#7
|
Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Jun 2016
Location: Colorado
Posts: 8,971
|
I use a cash management account tied to my brokerage account. It brings everything together including credit card into one space. I have a lot of monthly interest and dividends so there is always free cash flow to reinvest or skim off the top off. I feel you pay for having too much cash as it is a drag on return. With that being said, I monitor my spend via a spreadsheet so I always know where I stand in relation to my spending goals. So I voted PULL.
|
|
|
06-28-2019, 03:25 PM
|
#8
|
Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Jan 2018
Location: Tampa
Posts: 11,298
|
Push amount with the same withdrawal each month. Very large lumpy expenses come out of an emergency account, but that's a whole other discussion.
__________________
TGIM
|
|
|
06-28-2019, 03:36 PM
|
#9
|
Thinks s/he gets paid by the post
Join Date: Aug 2013
Posts: 1,660
|
Both. Push for regular monthly stuff and pull for stuff like trips or major purchases. This way I have to make a conscious decision to spend money beyond the monthly stuff (because it requires a manual transfer of funds).
|
|
|
06-28-2019, 03:42 PM
|
#10
|
Thinks s/he gets paid by the post
Join Date: Jan 2017
Location: Hog Mountian
Posts: 2,077
|
Voted bacon.
We have a push to the soulless mortgage holder (and a few utility bills) as its a fairly fixed amount. We use a pull (to the credit union) for discretionary stuff as it tends to be very lumpy.
__________________
Never let yesterday use up too much of today.
W. Rogers
|
|
|
06-28-2019, 03:46 PM
|
#11
|
Thinks s/he gets paid by the post
Join Date: Dec 2014
Location: St. Charles
Posts: 3,919
|
Quote:
Originally Posted by Red Badger
Voted bacon.
We have a push to the soulless mortgage holder (and a few utility bills) as its a fairly fixed amount. We use a pull (to the credit union) for discretionary stuff as it tends to be very lumpy.
|
I voted bacon for a similar reason. We have a monthly push (not enough to cover normal spending), but then we pull additional funds as needed.
I would be comfortable just pulling as needed, but DW likes to get the "monthly paycheck".
__________________
If your not living on the edge, you're taking up too much space.
Never slow down, never grow old!
|
|
|
06-28-2019, 03:46 PM
|
#12
|
Thinks s/he gets paid by the post
Join Date: Jan 2005
Location: northern Michigan
Posts: 2,215
|
Quote:
Originally Posted by RetireAge50
Both. Push for regular monthly stuff and pull for stuff like trips or major purchases. This way I have to make a conscious decision to spend money beyond the monthly stuff (because it requires a manual transfer of funds).
|
+1, same here.
|
|
|
06-28-2019, 04:51 PM
|
#13
|
Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Mar 2017
Location: City
Posts: 10,351
|
Pull. Monthly expenses can easily vary by many thousands, even $10-20K when we pay for a trip. Principal reasons include travel, property, and income taxes. A car in January, a refurbished pontoon boat & new motor in May, ... Push would make no sense.
|
|
|
06-28-2019, 04:54 PM
|
#14
|
Moderator
Join Date: Feb 2010
Location: Flyover country
Posts: 25,356
|
It's not always apparent, is it?
Midvale.jpg
__________________
I thought growing old would take longer.
|
|
|
06-28-2019, 05:03 PM
|
#15
|
Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Jan 2006
Location: Rio Grande Valley
Posts: 38,145
|
Push.
My income is based on the Dec 31 value of my retirement portfolio. On Jan 2 (or whenever the next market/business day is), I pull out an entire year’s worth of income - a fixed X% of the portfolio - and move it to a high yield savings account. I set aside what I have estimated as taxes I must pay throughout the year, including estimated taxes, and the remainder is available for spending throughout the year.
So you could say that my withdrawal/income drives my budget/planned spending rather than the other way around.
After the annual withdrawal I rebalance my retirement portfolio if needed. Then pretty much leave it alone.
__________________
Retired since summer 1999.
|
|
|
06-28-2019, 05:04 PM
|
#16
|
Thinks s/he gets paid by the post
Join Date: Aug 2012
Posts: 1,862
|
I pull my annual withdrawal from our IRA's and deposit to Ally. I have an automatic push coming from Ally the 15th of the month for regular expenses. Earlier this year we needed a new AC, furnace, hot water heater and sump pump, and did a pull from Ally to cover that gargantuan bill. It's working for us. I missed having a regular paycheck, and now with SS and my pension, we're in a good routine.
__________________
FIRE Class of 2018 @ 61
Old men and women sit in the shade of trees they planted long ago
|
|
|
06-28-2019, 06:11 PM
|
#17
|
Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Sep 2005
Location: Northern IL
Posts: 26,891
|
Another "BOTH".
I like the push method, as it is on auto-pilot for covering regular bills, plus a little to keep a buffer for the other stuff that pops up. If something happened to me, everything would just go on, auto-pay pulling, and the auto-deposit push.
If the balance gets large, visit the "Blow That Dough!" thread, or invest it. If it gets tight, think about controlling your spending and/or just pull some more to cover.
-ERD50
|
|
|
06-28-2019, 06:17 PM
|
#18
|
Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Nov 2009
Posts: 6,695
|
For money coming in, which is I believe the OP was asking about, I use "push." For money going out to pay the bills, I use "pull," mostly. I use "push" for only a few things going out.
__________________
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!"
|
|
|
06-28-2019, 06:47 PM
|
#19
|
Thinks s/he gets paid by the post
Join Date: Aug 2010
Location: Back woods of Fennario
Posts: 1,170
|
Push it real good...... (unrelated to OP's question; just can't resist a Salt-N-Pepa reference opportunity....)
__________________
"Time wounds all heels...." - Groucho Marx
|
|
|
06-28-2019, 06:48 PM
|
#20
|
Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Jul 2008
Posts: 35,712
|
Pull mostly throughout the year, to replenish the checking account for wife to pay bills.
At the year end, if my WR is below plan I may do a push to keep the tax burden even from year to year. Or do a Roth.
This reminds me it's time for another pull. Darn, that last pull did not last long. Wife just paid those credit card bills from the long Europe road trip. Next month will be better, because there are no more large bills that are outstanding.
PS. Multiple choices should be allowed in this poll. Why can't a pusher or puller be allowed to like bacon also?
__________________
"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)
|
|
|
|
|
Currently Active Users Viewing This Thread: 1 (0 members and 1 guests)
|
|
Thread Tools |
|
Display Modes |
Linear Mode
|
Posting Rules
|
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts
HTML code is Off
|
|
|
|
» Recent Threads
|
|
|
|
|
|
|
|
|
|
|
|
|
» Quick Links
|
|
|