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Old 04-19-2015, 09:45 PM   #61
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I am amazed that people are willing to spend a lot of time to discuss the action of two particular persons to such a great depth. There are billions of people in the world and there are many actions that different people can take. These two guys want to retire at 30 with $1M in banks. Another two guys want to retire at 30 without money in banks and decide to rob the banks. Every one has his/her choice of life.
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Old 04-20-2015, 06:44 AM   #62
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Originally Posted by flyingaway View Post
I am amazed that people are willing to spend a lot of time to discuss the action of two particular persons to such a great depth. There are billions of people in the world and there are many actions that different people can take. These two guys want to retire at 30 with $1M in banks. Another two guys want to retire at 30 without money in banks and decide to rob the banks. Every one has his/her choice of life.
That is why this is a retirement forum, to discuss retirement ideas! From reading various individuals retirement ideas one can better formulate or modify their own retirement, this to me is the purpose of the forum.

As for the couple, with present ACA and college funding, I do not see why if the spending can be held to 40K per year it would not work out. ACA will only be 242 per month for a family of 3 and if there is after tax money and can hold income recognized to 30K you are only talking about 100 per month. Additionally there would be no need to save for college for the child as present rules would most likely make grants available in the 10K per year range.

Downside would be lack of qualification for Social Security but whether or not the 4% withdrawal rate would work would be known pretty much by the time the couple was 40 and still able to work.

As long as the expense could be controlled to 40K and flexibility if work force reentry was an option, I see no reason to not give it a go.
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Old 04-20-2015, 07:26 AM   #63
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Personally I wouldn't do it.

But I did enter into FireCalc a portfolio of $1M, withdrawal of $40k per year and a 60 year time period and it gave a probability of success of 82% (which seems high to me). This used the default FireCalc settings. But like others have said, there are so many variables for a potential 60 year retirement that I would not feel comfortable.
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Old 04-20-2015, 07:29 AM   #64
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I"m with Brewer and Fuego (and Fermion) on this: sure, I'd have done it, knowing that I'd probably have to do something for a few coins most years, and not have a problem with that. The kids thing is different for me, but it would seem you can raise them without spending exorbitant amounts of cash if need be.

The catastrophic events like major health problems would certainly worry me, and there's no question that money makes those kinds of things easier to deal with, but it would again probably be a gamble I'd have taken if I could.

I guess I wouldn't call it retirement, as such, but more of a lifestyle change to intermittent work. The old Travis McGee, if you will.
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Old 04-20-2015, 08:59 AM   #65
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I have a couple of old friends/cow*rkers who sort of did this, although not exactly. In their early 40s they "retired" to the beach in FL with the intention of living off their savings as long as they could, sort of like "retirement is wasted on the old". They lasted a decade or so, partly due to a fairly large payoff at the track. But last I heard they both have had to go back to work, and I don't think retirement is in their future for a long, long time. To each his own, but at 59 and having been retired for 9 years, I would be absolutely miserable going back to work.
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Old 04-20-2015, 09:47 AM   #66
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I have a couple of old friends/cow*rkers who sort of did this, although not exactly. In their early 40s they "retired" to the beach in FL with the intention of living off their savings as long as they could, sort of like "retirement is wasted on the old". They lasted a decade or so, partly due to a fairly large payoff at the track. But last I heard they both have had to go back to work, and I don't think retirement is in their future for a long, long time. To each his own, but at 59 and having been retired for 9 years, I would be absolutely miserable going back to work.
What?

How is this story of two people gambling at a racetrack at all related to someone investing $1m in a diversified portfolio and trying to live on 4% of it?

I heard a story about a guy who worked until age 60, retired, then lost all of his money on a bad business venture. I guess that proves that working until 60 doesn't work either.
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Old 04-20-2015, 09:53 AM   #67
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What?

How is this story of two people gambling at a racetrack at all related to someone investing $1m in a diversified portfolio and trying to live on 4% of it?

I heard a story about a guy who worked until age 60, retired, then lost all of his money on a bad business venture. I guess that proves that working until 60 doesn't work either.
I might have read it wrong, but I took the story to mean that this couple tried to retire early when they thought they had enough money, but weren't able to sustain themselves. Perhaps they budgeted wrong or some big expense, or something came up. But then, they lucked out at the race track, and that was able to sustain them a bit longer. But in the end it wasn't enough to keep them retired, so they had to go back to work.

At least, that was my take on it.
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Old 04-20-2015, 09:56 AM   #68
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I might have read it wrong, but I took the story to mean that this couple tried to retire early when they thought they had enough money, but weren't able to sustain themselves. Perhaps they budgeted wrong or some big expense, or something came up. But then, they lucked out at the race track, and that was able to sustain them a bit longer. But in the end it wasn't enough to keep them retired, so they had to go back to work.

At least, that was my take on it.
They lasted one decade. There has not been ANY financial event in the markets of the past 60 years where a diversified portfolio of stocks/bonds in a reasonable mixture (say 60/40) failed at a 4% SWR in just 10 years.

This means they really didn't have enough money to even sustain a 4% SWR retirement and were counting on something else (gambling) to make their retirement work.

That is my take on it
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Old 04-20-2015, 10:14 AM   #69
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What, we're not allowed to off topic anymore? I must have missed the rule change. Sorry, please stop beating me massa! I...can't...breathe!
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Old 04-20-2015, 10:39 AM   #70
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What, we're not allowed to off topic anymore? I must have missed the rule change. Sorry, please stop beating me massa! I...can't...breathe!
You posted a story and then made the statement "To each his own, but at 59 and having been retired for 9 years, I would be absolutely miserable going back to work."

I thought your story was told as an attempt to reinforce that statement. I am sorry if you were just telling a story and making a separate statement and the two were unrelated.

I had a hamster once. He ate a marble and died. I do not think Social security will be cut.

Confused?
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Old 04-20-2015, 10:59 AM   #71
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Why not just agree to disagree and keep it friendly.
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Old 04-20-2015, 11:36 AM   #72
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That is why this is a retirement forum, to discuss retirement ideas! From reading various individuals retirement ideas one can better formulate or modify their own retirement, this to me is the purpose of the forum.

As for the couple, with present ACA and college funding, I do not see why if the spending can be held to 40K per year it would not work out. ACA will only be 242 per month for a family of 3 and if there is after tax money and can hold income recognized to 30K you are only talking about 100 per month. Additionally there would be no need to save for college for the child as present rules would most likely make grants available in the 10K per year range.

Downside would be lack of qualification for Social Security but whether or not the 4% withdrawal rate would work would be known pretty much by the time the couple was 40 and still able to work.

As long as the expense could be controlled to 40K and flexibility if work force reentry was an option, I see no reason to not give it a go.
OK. I get it. Everyone can retire regardless. One can have ACA for health care, and grants for kids' college education. Please don't forget there are food stamps (and churches) for people when they run out of money.
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Old 04-20-2015, 12:15 PM   #73
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Alright y'all. No reason for such crankiness on a Monday morning, especially the already retired ones. I'm the one still working, at least I have an excuse.
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Old 04-20-2015, 12:20 PM   #74
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Depends on the definition of retiring. If it's like MMM just switching to self-employment on their own terms the answer would be yes.
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Old 04-20-2015, 12:55 PM   #75
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I think more people should take the route of extreme early retirement from "career" positions and live life, supplementing along the way, doing lower paid work that is more enjoyable or less stressful, when needed/wanted.

Even with kids. Raise your kids, teach them, be part of your community.

Maybe this is a generational perspective shift but I don't see any particular honor earned or bozo buttons handed out for putting in 30 years at megacorp, having strangers raise your kids, and living life through purchased products and annual vacations at the all-inclusive resorts, while looking at your best years and health fade in the rear view mirror.


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Old 04-20-2015, 01:03 PM   #76
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I think everyone should do what works best for them individually. Some people would not be able to sleep with that plan.
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Old 04-20-2015, 01:07 PM   #77
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A frugal person could retire with $1,000,000 at 30.
Living in a van under a bridge maybe?

But they're missing the main point of the 4% calculation, I think. Doesn't the 4% rule sort of stop working beyond 35-40 years or so?
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Old 04-20-2015, 01:10 PM   #78
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I think more people should take the route of extreme early retirement from "career" positions and live life, supplementing along the way, doing lower paid work that is more enjoyable or less stressful, when needed/wanted.

Even with kids. Raise your kids, teach them, be part of your community.

Maybe this is a generational perspective shift but I don't see any particular honor earned or bozo buttons handed out for putting in 30 years at megacorp, having strangers raise your kids, and living life through purchased products and annual vacations at the all-inclusive resorts, while looking at your best years and health fade in the rear view mirror.
Well said. I am the older generation but I wish I had realized to do this years ago, though partly why we couldn't were concerns over health insurance and pre-existing conditions. The ACA has made this kind of life more of a reality.

The traditional American Dream is the dream we have been spoon fed from billions and billions of dollars in marketing our entire lives.
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Old 04-20-2015, 01:11 PM   #79
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I wouldn't have retired w/ $1M at 30. I won't retire with $1M at 40. I may retire with somewhat more than that plus a pension at 42, however!

That kind of money that early would've led me to a different career path, I think. Just like that kind of money at 42 will allow me to do something I want to do rather than finding a "real job" to make ends meet, if I decide to find a job at all.
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Old 04-20-2015, 01:20 PM   #80
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Living in a van under a bridge maybe?

But they're missing the main point of the 4% calculation, I think. Doesn't the 4% rule sort of stop working beyond 35-40 years or so?
Thinking more like - van down by the river.
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