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Old 08-30-2020, 12:55 PM   #21
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I have a friend, an elderly bachelor with no children and lots of relatives he doesn't like. He doesn't have a will. I told him he absolutely needed a will or his relatives will get it all if he dies intestate. He wanted to give it to me (at least $5 million) I told him to give it to the children's hospital at the same hospital that saved his life when he had heart trouble a few years back. He said he was going to, I hope he got it all set up.


He lives on much less than 4% of his NW and he lives very well.
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Old 08-30-2020, 01:06 PM   #22
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I use VPW which varies the drawdown based on stock market results and how long you have left to live. I plan for the younger spouse to live to 100.

https://www.bogleheads.org/wiki/Vari...age_withdrawal
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Old 08-30-2020, 01:19 PM   #23
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Originally Posted by SpinDoctorTX View Post
I have no kids, however we have a "gentlewo/men's agreement" if one of us goes first. DH has 2 sons so they'll get 25% ea. The other half to my family with different distribution instructions for a multitude of possible situations (DM gets all, DS, DB, or their kids). We have a provision that our house can be occupied by DM so long as taxes paid/ repairs done etc. DM is 84 in a month- she lives in Houston 1/3 of the year & on her KY farm the rest of the year..
This is all in a comprehensive estate plan with documentation of your DM's life estate in the house, etc. Right?
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Old 08-30-2020, 02:12 PM   #24
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My wife and I are in the same boat. I'd been vacillating between which withdrawal method we'd use but lately I'm thinking the Variable Percentage Withdrawal (VPW) method mentioned by Spudd a couple of messages back makes the most sense for us. We also named a number of charities in our wills should we not spend it all. These charities are smaller, lesser-known charities that would probably need the money more than the larger, better known charities like The American Cancer Society would.
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Old 08-30-2020, 02:16 PM   #25
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It is a conundrum. Spend too much and you may have to curtail spending too much later. Spend too little & you have a fortune to spend later, but you may be too feeble to enjoy it.

On the other hand, like others have said, spending for the sake of it makes no sense.

Right now, we're comfortable on less than 4% of portfolio value, so we are adding some small / infrequent luxuries and indulgences. I keep a close watch on annual spend (trailing 12 months) as a percentage of portfolio, so hopefully, we'll see a problem coming before it becomes critical.
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Old 08-30-2020, 02:22 PM   #26
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No kids here, but my WR will likely be below 4% because I'm a naturally frugal type. Currently, I plan to leave excess funds to my niece and a few charities. That's not a goal though, and if my frugal streak fades I'm fine with leaving very little or nothing.
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Old 08-30-2020, 02:34 PM   #27
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One kid and several relatives but I don't "plan" on leaving anyone anything. I hope/plan to have enough left over to pay for my own burial but that's about it. In reality, I don't think I'll be able plan that well and spend it all but I'm trying. So the DD may get something out of my demise.
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Old 08-30-2020, 02:52 PM   #28
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One kid and several relatives but I don't "plan" on leaving anyone anything. I hope/plan to have enough left over to pay for my own burial but that's about it. In reality, I don't think I'll be able plan that well and spend it all but I'm trying. So the DD may get something out of my demise.
I will inherit almost nothing but my parents did at least pre-pay their funeral costs. Did you know that's an option. It can really reduce the burden on your heirs. I plan to do the same thing.
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Old 08-30-2020, 02:54 PM   #29
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No kids and no close family. For the first 6 years we've been staying at 3%. This year we blew by that in June and are still spending. Probably hit 6% this year then back to a more normal 4. I don't plan on my SS until 70 which is a good portion of our monthly expenses so we will have to work harder to spend.
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Old 08-30-2020, 03:19 PM   #30
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It is commonly observed that people in care facilities with no family to watch over them, aren't treated as well. Therefore I would expect such people to allocate a larger %age of net worth to paying for the best possible facility - plus care advocates and aides.
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Old 08-30-2020, 03:30 PM   #31
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I will inherit almost nothing but my parents did at least pre-pay their funeral costs. Did you know that's an option. It can really reduce the burden on your heirs. I plan to do the same thing.
Yep, but I'm not paying those (***** *******) a dime in advance. I'd like to spend it all before I go but in reality I know I'll be leaving well over a million and that's in the worse case... I've haven't scrimped on much of anything, especially in the past 40 to 50 years, but I told my DD to go the cheapest and easiest route possible for my final expenses. ex. No services, no casket and cremation in a cardboard/plywood box...
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Old 08-30-2020, 04:58 PM   #32
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It is commonly observed that people in care facilities with no family to watch over them, aren't treated as well. Therefore I would expect such people to allocate a larger %age of net worth to paying for the best possible facility - plus care advocates and aides.
Yes, definitely. Even if you do have family, it's better to be in a good place where that should be less of a worry. So many people here talk about spending more while they are healthy, but now at age 86/84 my folks are going to be spending easily more than double what they ever did in the 24 previous years of retirement. But, anyone who wants to limit their options to places that take Medicaid, spend away. Maybe the options are better in other areas than where my folks live.
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Old 08-30-2020, 05:25 PM   #33
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Yes, definitely. Even if you do have family, it's better to be in a good place where that should be less of a worry. So many people here talk about spending more while they are healthy, but now at age 86/84 my folks are going to be spending easily more than double what they ever did in the 24 previous years of retirement. But, anyone who wants to limit their options to places that take Medicaid, spend away. Maybe the options are better in other areas than where my folks live.
Totally agree.

In our early 70’s and FIRE’d 14 years, DW and I have chosen to have 10 years of private pay care set aside. If not used, then DS’s family gets it. Medicaid can be pretty iffy.

Fortunately, we’re comfortable with our spending even with that chunk of our FIRE portfolio set aside in this way.
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Old 08-30-2020, 05:41 PM   #34
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The point of the 4% “rule” is to have your next egg last through expected lifetime, not to leave a legacy. I would hope that any “rule” would leave some left because no one can know if you need one more year of spending.
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Old 08-30-2020, 05:47 PM   #35
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The point of the 4% “rule” is to have your next egg last through expected lifetime, not to leave a legacy. I would hope that any “rule” would leave some left because no one can know if you need one more year of spending.
Well..... historically you would have left a legacy 95% of the time.
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Old 08-30-2020, 06:04 PM   #36
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Our goal is not to be a burden on anyone else, financially or otherwise. If we leave money on the table, that's better than the alternative to us.
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Old 08-30-2020, 07:33 PM   #37
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Well..... historically you would have left a legacy 95% of the time.
But the point of 4% “rule” is have enough to get there on. So looking at a higher rate would increase the chances that you would outlive your funds. I guess I’m looking at the question from another angle. What is a “safe” rate to get acceptable odds of not outliving your funds. My withdraw plan is made to ensure we have funds through retirement. If there are some funds left for a bequest, great but only goal is to fund our retirement years with some confidence.

As the artist said can’t take it with you when your gone, just want enough to get there on. Solve that problem and you “win”.
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Old 08-30-2020, 08:10 PM   #38
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I wanted to follow the 4% rule, but found it to be a bit too limiting, as I want to have a house early in ER, dive, and hopefully travel, while my health is presumably better. I don't expect to have a constant WR throughout the remainder of my life, especially if it lasts for 20-30+ years or so. Bernicke's 'rule' fit my mom's spending profile, almost to a T, up until the end. If she hadn't had a good friend who helped her with meds, shopping, and doctor's visits (and hadn't had dementia and refused paid help), the last 3 years would have been more expensive.

I plan to 'pre-spend' from age 55 (next year) to age 70 or 75, with a starting WR of 4.3-4.7%. Then, when SS kicks in, if the portfolio is lower than starting, then I'll adjust the spending to account for SS and the lowered 'new' starting value, a la VPW; if it's even, or up, then SS will give the spending a boost. While there's some risk, even if the portfolio drops by 50%, that with SS, and moving from the house to a condo (which is my mid-term plan, regardless of assets) should be more than enough to offset the loss.
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Old 08-30-2020, 08:14 PM   #39
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I feel like for those of us who likely and lucky to have more than we’ll need, it really comes down to the question of whether you get more joy from accumulation or from spending. As stupid as it sounds, I get more joy from watching the numbers on the spreadsheet grow than from buying expensive things I don’t really crave. Hopefully that’ll make some charities very happy one day when they receive a surprise windfall from my estate.
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Old 08-30-2020, 08:19 PM   #40
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...I get more joy from watching the numbers on the spreadsheet grow than from buying expensive things I don’t really crave. Hopefully that’ll make some charities very happy one day when they receive a surprise windfall from my estate.
Good for you! I've deferred so much spending, that I could easily buy some new sports car, some higher-end audio and video gear, a boat, and even build a home theater add-on to the house, if I had extra $. Still, we will likely have no heirs, and whatever is left will go to something like the Cousteau Society.
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