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Go Go to Slow Go... when did/has it happened to you?
Old 07-07-2021, 02:25 PM   #1
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Go Go to Slow Go... when did/has it happened to you?

Perhaps another way of putting it, when did you really stop BTD?

The science all seems to make sense... in ER you are in the honeymoon stage and excited to get after it and BTD on things such as travel, fun cars, fix up the house, buy some toys and then perhaps at sometime in the future (say in 70's), you get achy, health issues hit, maybe a little lazy, have a "been there done that" attitude to some things and pull back to a simpler less BTD lifestyle.

I'm in my last year of "part time work" and have taken off the governor on spending this year to really see how much I can/would BTD. The biggest items are travel this year, including 2 all expense paid trips with kids/G kids (9 of us) which can clearly run up the tab, along with some other trips with DW. Clearly, some of this extra travel is the result of Covid. Additionally, we have done some home renovation/new furniture and bought a few small toys. While I am not spending just to spend, I wonder how long I will really want to run at a serious BTD pace, regardless of my ability to fund it. Aside from any above normal gifting, I'm feeling like this could be my biggest spend year on BTD stuff.

When did you see your BTD trend line start to turn down (if it has)? What triggered the change? How much did your average annual spend drop?

This BTD stuff can be hard!
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Old 07-07-2021, 02:45 PM   #2
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You can look at averages, but it only helps if you are average. I have friends who did active travel, skiing, dancing, etc past their mid-80s. Others wound down around 70.

Once again I'll bring up my parents. They have had a U shaped spending curve. Upon retirement, they did trips. Nothing too taxing, but flying, bus rides, walking around attractions, etc. Then with my mom's arthritis and my dad not enjoying them that much they stopped and I don't think they've been more than 100 miles from home in the ~15 years since. Sometime around there they decided to move to an independent living community. Basically like living in an apartment with inner hallways, and activities for seniors, and a few meals a month. Then they moved to another place where all meals were included. More money, but still very sustainable. Now my mother is in memory care, and dad is in the independent living part of the community. If she lives for 3-4 more years she will be able to "die with zero" at any time. Maybe some people don't mind whatever Medicaid option there is for memory care, but those options are not good where they are, near most of the family. I will take up the payments if there is not a good medicaid option when that happens.

The message is, don't count on your expenses staying low once you slow down. I guess most just don't have a choice. From what I hear about LTC insurance is that there's a lot of fine print that limits payouts, and most can't really save enough to self-insure for a long time.
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Old 07-07-2021, 03:20 PM   #3
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Perhaps another way of putting it, when did you really stop BTD?

The science all seems to make sense... in ER you are in the honeymoon stage and excited to get after it and BTD on things such as travel, fun cars, fix up the house, buy some toys and then perhaps at sometime in the future (say in 70's), you get achy, health issues hit, maybe a little lazy, have a "been there done that" attitude to some things and pull back to a simpler less BTD lifestyle.

I'm in my last year of "part time work" and have taken off the governor on spending this year to really see how much I can/would BTD. The biggest items are travel this year, including 2 all expense paid trips with kids/G kids (9 of us) which can clearly run up the tab, along with some other trips with DW. Clearly, some of this extra travel is the result of Covid. Additionally, we have done some home renovation/new furniture and bought a few small toys. While I am not spending just to spend, I wonder how long I will really want to run at a serious BTD pace, regardless of my ability to fund it. Aside from any above normal gifting, I'm feeling like this could be my biggest spend year on BTD stuff.

When did you see your BTD trend line start to turn down (if it has)? What triggered the change? How much did your average annual spend drop?

This BTD stuff can be hard!
Does this help? I took my annual spending for each year of retirement, and divided it by my spending during my first year of retirement. I have an overfunded retirement, so I spend what I want.

Kind of looks all over the place, to me.
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Old 07-07-2021, 03:32 PM   #4
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Does this help? I took my annual spending for each year of retirement, and divided it by my spending during my first year of retirement. I have an overfunded retirement, so I spend what I want.

Kind of looks all over the place, to me.
Interesting! So was your yr 1 spend what you planned/budgeted or just some arbitrary spend that just so happened? If I am interpreting your graph correctly, it appears your worst case scenario (so far) was about 20% above your year 1 and your lower years dropped about 10%?

I would put myself in somewhat of the overfunded group with a low 2% WR and healthy planned annual (discretionary) spend. Just really wondering how much BTD is going to get me excited year after year.

Your graph says... "Who knows?!"
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Old 07-07-2021, 03:44 PM   #5
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Interesting! So was your yr 1 spend what you planned/budgeted or just some arbitrary spend that just so happened? If I am interpreting your graph correctly, it appears your worst case scenario (so far) was about 20% above your year 1 and your lower years dropped about 10%?

I would put myself in somewhat of the overfunded group with a low 2% WR and healthy planned annual (discretionary) spend. Just really wondering how much BTD is going to get me excited year after year.

Your graph says... "Who knows?!"
I did not want to spend more than 3.5%, or my dividends, whichever was smaller. So for Year One my dividends came to 2.8% but I didn't really need that much so I spent 2.61% of my portfolio. That percentage dropped as other income streams kicked in.

Later on, starting in 2013, I had SS which I honestly did not expect would survive for us baby boomers (such pessimism! ). So, I had more to spend. But I didn't need it, so my spending did not skyrocket.

The most that I spent was 126% of my year one spending, and that was the year I got my total knee replacement so I was feeling sorry for myself.

I'd say yeah, who knows? But if my budget had been tighter, then it might have been more constrained as I grew older. I suspect that nobody wants to run out of money in old age.

I tend to think all this go go to slow go stuff is baloney, at least in my case. There are lots of things for me to spend money on in old age that I didn't need or want at younger ages. I'm happy to have an over-funded retirement as I grow older.
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Old 07-07-2021, 03:50 PM   #6
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Hasn’t happened yet. We had a couple of initial spendy years, but after that costs dropped due to RV full timing. Then 5 years later we bought another house. Costs went up some. Then we started doing more international travel. Costs rose. Then we realized we could afford more high end international travel plus more generous gifting, so expenses went up quite a bit more, exceeding early expenses.

We are still relatively young for retirees and once we are mostly past this COVID thing, we expect to do considerably more international traveling, as much as we can the next 10 years while we are still still healthy.

Hopefully we are at least still 10 years away from slowing down.

Also anticipate a big outlay for CCRC type arrangements in our early 80s. And potentially helping with sibling health/LTC needs.

So we don’t plan on the go slow no go spending drop.
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Old 07-07-2021, 03:58 PM   #7
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I don't know what "BTD" is. Never heard that before.

I don't fall into the standard "go go, slow go" pattern of retirement. I'm two years into retirement, and I enjoy a slow pace. My life gets better when I slow down. A frantic, go-go pace makes me uncomfortable. It jangles my nerves. I try to avoid "sped up" states generally (although I do like my morning coffee). I prefer to slow down and take it easy, not burn up the track.
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Old 07-07-2021, 04:04 PM   #8
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I don't know what "BTD" is. Never heard that before.
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Old 07-07-2021, 04:09 PM   #9
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BTD = Blow that Dough.
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Old 07-07-2021, 04:20 PM   #10
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Does this help? I took my annual spending for each year of retirement, and divided it by my spending during my first year of retirement. I have an overfunded retirement, so I spend what I want.

Kind of looks all over the place, to me.
Just curious, are these dollar amounts adjusted for inflation, or just actual spending?

Iíve often wondered if most ER folks actually see their spending rising year over year at the rate of inflation.
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Old 07-07-2021, 04:30 PM   #11
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Over decades my retirement spending changes have had nothing to do with inflation. Driven by lifestyle changes and available funds.
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Old 07-07-2021, 04:35 PM   #12
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Just curious, are these dollar amounts adjusted for inflation, or just actual spending?

I’ve often wondered if most ER folks actually see their spending rising year over year at the rate of inflation.
Those are actual dollars spent during those 11 years. I just whipped up that graph on the fly a few minutes ago and I think it is more clear and easily understandable this way. YMMV!
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Old 07-07-2021, 04:39 PM   #13
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Just curious, are these dollar amounts adjusted for inflation, or just actual spending?



Iíve often wondered if most ER folks actually see their spending rising year over year at the rate of inflation.


I have wondered the same thing. How many people tend to maintain a steady 4% withdrawal throughout retirement with no adjustment for inflation because they have additional income like pension or social security coming in along the way? I would venture to think this scenario is more common than we think. This probably means that they would really need to BTD later because with no adjustments for inflation, theyíre likely to have a lot left.
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Old 07-07-2021, 04:45 PM   #14
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I have wondered the same thing. How many people tend to maintain a steady 4% withdrawal throughout retirement with no adjustment for inflation because they have additional income like pension or social security coming in along the way? I would venture to think this scenario is more common than we think. This probably means that they would really need to BTD later because with no adjustments for inflation, they’re likely to have a lot left.
Many compute WR as a percentage of the total portfolio value on 12/31 of the year before.

I think that once we retire, a lot of the "spend spend spend!!!" need seems to lessen. At least it did for me so I am thinking maybe that is the case in general.
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Old 07-07-2021, 04:49 PM   #15
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We retired in 2016 and have been BTD throughout our working years as well as into retirement. We travel about 3 months a year, a few weeks to our regular timeshare resorts in California, Arizona and Hawaii, and a few cruises a year although we had to stop in 2020 because of COVID. This year we sold and bought a more expensive home and then spent on expensive and expansive remodel of the new home. My husband does not want to slow down in travel until one of us is less mobile. I doubt we will move again, or maybe when one of us goes first. We belong to a country club here and golf alot which is a great time killer but also keeps us healther. If my husband goes before I do, I may stop paying the country club membership dues and just rely on gym and pool. We eat out alot when we were working and we still eat out alot but not nearly like we used to.
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Old 07-07-2021, 05:37 PM   #16
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BTD = Blow that Dough.
Yeah, I realized that about an hour after posting...
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Old 07-07-2021, 06:34 PM   #17
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In the 9 years of retirement travel has been the biggest expense not counting medical. We spent anywhere between 4-14k a year 6 of those years.
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Old 07-08-2021, 03:06 AM   #18
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BTD = Blow that Dough.
Ah! I was totally lost until you posted this.
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Old 07-08-2021, 04:32 AM   #19
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This year (#4) looks like it will be around 165% of year 1. It will definitely drop next year, as our remodeling spree will be over, even though we plan to replace the car.
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Old 07-08-2021, 04:57 AM   #20
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BTD hasn't stopped. Travel spending slowed down a little because of Covid, but I expect it to start escalating in about a month. I don't expect spending to slow down much in the next 10 years.
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