To those already retired

[socca]

You can measure your current net worth by your personal financial balance sheet, but this is kind of boring. There are many other possible measures, such as the value of your past and current contributions to a particular community.

Bailing out of the American War Machine has meant a huge drop in my personal income (although cash flow is still positive and net assets are still rising, albeit more slowly) but a huge increase in my potential to make worthwhile contributions to certain communities which I admire. The trade-off is worth it (to me).

 

[audreyh1]

It's lower! I retired in August of 1999. My current net worth is 18.6% lower than it was when I retired!

Of course, my net worth was at an all time high in October 2007, and very close to that all time high in May of 2008.

Well, at least I have had almost 10 years of great retirement living to show for it!

Hey - by this measure, we should still have 43.8 years to go!

Actually, going back through the details (and this is WHY I like to keep all this data around in Quicken!) I see that there was a massive tax bill for 1999 due to realized gains on the stock we sold to set up our retirement fund. If I take out the estimated taxes we set aside in 1999, knowing we would have to pay it in April of 2000, the net worth comparison is now down 11.2%. Not nearly so bad, really. But still pretty shocking! no?

Audrey

 

[Koolau]

I wonder where you're going with this question......

Folks who are worth more today than when they ER'd will no doubt have some special circumstance such as pensions that cover all expenses, investments that are completely avoiding the current downturn, inheritance, insurance or legal award, etc.

Retired in '05. Don't have the exact figures as some are difficult to value right now. I'm saying "equal or better" than when I retired.

While youbet calls it "special circumstances" I like to call it "diversification" even if that diversification is a bit bizarre. My relatively low equity portion of the PF took about the same hit as everyone else's here.

Yes, I do have a pension but it only covers about 1/3 of my outflow - this year, anyway. Nor is it COLA'd. So I look at my pension as being worth LESS than it used to be even though the dollar amount is the same.

But my house value has been relatively stable since '05 (up since then and then back down a bit - roughly a wash - but who knows if I don't actually sell it which I don't plan to do.) So while most have lost money on housing, I'm saying it's roughly the same.

Cash portion of PF is mostly in Stable Value funds and SPDAs - in total they have gone up at a rate of nearly 5% per year. This is the largest portion of my PF. Figure I'm significantly ahead though a case could be made for discounting to inflation since '05.

Bizarre (diversified?) portion:

Gold and silver coins pitched into the bottom of the safe deposit box - up quite a bit in the past several years. Probably covers most of my losses in equities.

SS (both DW's and mine) value has gone up with inflation though DW just started last month and I'm waiting. But the "value" has gone up at least in dollar amount - maybe only equal based on inflation.

"Rothing" my IRAs - yeah it cost me some taxes, but I consider that I now have MORE in IRAs than I used to and everything I've converted is now "tax free". I get to worry less and less about the inevitable RMDs at age 70 (talk about priceless!) So I consider the value to be higher.

My share of (very) small family bidness - profits up so guess that means value is up. How to value? Who knows?

Collectables - Just have to trust me on this. Value is UP. Not a huge portion of PF, but a few % at least.


So I guess I'm saying I agree with youbet that my PF is not "typical" but I'm guessing most of our PFs aren't typical. We have a wide range of situations and circumstances which may make it difficult to value our PFs or be certain if we've gained or lost value. Still, I believe I could make a good case that my PF has NOT gone down and maybe has increased since '05. Of course, those with more "traditional" PFs experienced much better results during the "good" years than I did. But YMMV, and FWIW of course.

 

[MichaelB]

IActually, going back through the details (and this is WHY I like to keep all this data around in Quicken!) I see that there was a massive tax bill for 1999 due to realized gains on the stock we sold to set up our retirement fund. If I take out the estimated taxes we set aside in 1999, knowing we would have to pay it in April of 2000, the net worth comparison is now down 11.2%. Not nearly so bad, really. But still pretty shocking! no?

Audrey

That's the spirit!

I think we retired around the same time and have had similar portfolio returns. I feel like I'm in good company...

 

[RonBoyd]

And I gained $10.9 billion on Berkshire Hathaway:

Berkshire net sinks; Buffett says economy in shambles | Reuters

Berkshire's net worth fell to $109.27 billion at year end from $120.16 billion at the end of September, and $120.73 billion at the end of 2007.

 

[dm]

I reran Firecalc today using today's numbers. I could still retire, but there is not much cushion. Since I am retired, at least that makes me feel alittle better. Like most I am cutting back on the extras untill, hopefully things turn around.

 

[audreyh1]

It's lower! I retired in August of 1999. My current net worth is 18.6% lower than it was when I retired!

Of course, my net worth was at an all time high in October 2007, and very close to that all time high in May of 2008.

Well, at least I have had almost 10 years of great retirement living to show for it!

Hey - by this measure, we should still have 43.8 years to go!

Actually, going back through the details (and this is WHY I like to keep all this data around in Quicken!) I see that there was a massive tax bill for 1999 due to realized gains on the stock we sold to set up our retirement fund. If I take out the estimated taxes we set aside in 1999, knowing we would have to pay it in April of 2000, the net worth comparison is now down 11.2%. Not nearly so bad, really. But still pretty shocking! no?

Audrey

Well - my current net worth report was missing a couple of key accounts!!! Oops!, so the news is better. Now I am only down 6.5% from where I started in August of 1999 - LOL!

FWIW, my net worth reached its peak in Oct 2007 at 55% above where I started in 1999. After that my net worth made a U-turn and plummeted 40%. Ouch! 8.1 years of gains, 17 months to wipe it all out!

Whatever

Audrey

 

[Dawg52]

I reran Firecalc today using today's numbers. I could still retire, but there is not much cushion. Since I am retired, at least that makes me feel alittle better. Like most I am cutting back on the extras untill, hopefully things turn around.

Ditto. Sure is depression though knowing how much I'm down.

 

[sander06]

My net weight is down 86 pounds since last June, 2008. Oh wait, you said net worth! Never mind!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!! Ha...

 

[tryan]

We're down 40-50% depending on how you value the rental property (harder to pin a number on). Mega corp 401k easily cut in half.

Good thing for those rents! Little bit interesting, with the drop in home value and rents remaining strong, my annual ROI has nearly doubled (from 3-4% at the peak to 6-8% today).

 

[grumpy]

Interesting coincidence - this week when I updated my portfolio spreadsheet I decided to look back to see when it was last this low. Turns out it was almost exactly when I retired from NASA in 2002. Home equity is pretty much a wash - current house was more expensive but value has fallen to almost what I got for the previous house. So overall my net worth hasn't changed at all since I retired.

 

[REWahoo]

I'm with grumpy (always wanted to say that). I'm back to 2002 levels, 3 years before retiring.

The bad news is I knew back then I didn't have enough to retire. The good news is I'm 7 years nearer death so now that number doesn't look quite so depressing.

 

[Moemg]

I checked 2002 levels and I'm $50,000 below it that is the bad news . The good news is my house (even with the drop ) is worth 50% more .

 

[bbbamI]

The bad news is I knew back then I didn't have enough to retire. The good news is I'm 7 years nearer death so now that number doesn't look quite so depressing.

Well, ahem..that's comforting...

 

[kumquat]

ER'd in June 07. Net worth doubled between Jun07 & June08 mostly because I had >50% in former mega-corp stock which tripled in that time frame. Sold some in June 08 and it has since tumbled but still about the same as Sept. 07.

Net worth is off 35% from it's high but still more than on my ER date.

 

[Tadpole]

Not retired.

House - don't really know so will use Zillow - down 14.5%.
Savings - up 77.5% since first recording 04/08/2004
- up 12.5% since end of year 2006
- down 4.5% since end of year 2007
- down 2.3% since end of year 2008

The major reason the downside is accelerating is that I am not retired and have been continuing to buy equities while prices decline and declines this year have eaten more than I have given. Whether this is smart or now will become more transparent with time. Husband retiring in September; I'm retiring in December 2010.

Paying the piper on deferred taxes will cost me more than the downturn/crash. (Also, inflation is not factored into the above numbers. I fear inflation more than the market.)