Can I retire NOW? I can't sleep! What do YOU think?

[obgyn65]

OK. I would assume that some people may finetune their asset allocation (i.e. shifting from 90/10 AA for example to 70/30) after reading posts here. However, I am not sure how many posters have changed their overall nature towards investing (e.g. from being very conservative like to me to 90% + in stocks like some other posters).

To answer your question, I come here to exchange ideas and learn about new financial strategies. Last year, after reading posts here, I bought deferred annuities, LTCI, and a few weeks ago Wellesley. For the first time, I designed a month by month cash flow model after reading about it here. But I have not become more of a risk taker even after reading many posts here.

I think this is not necessarily true. The discussions here often appear to reflect a fair degree of certainty and confidence, and I imagine that it is quite possible that people's opinions could be moved. Why come hear if there is no possibility that the material here could have any effect on one's opinions?

Ha

 

[steelyman]

I am not suggesting other members ever do it maliciously, it's invariably an innocent mistake when it happens, but it's surprisingly often. With respect, would that be more "kindly" obgyn65?

There's probably a "mommy.com" that can help here.

 

[daylatedollarshort]

I have not become more of a risk taker even after reading many posts here.

We have a very conservative portfolio as well. I don't want to gamble with my retirement savings. I am okay with just keeping up with inflation over retirement vs. losing 50% at some point in time.

I read the posts here and I couldn't sleep at night if I invested like most people here. Good for you guys for being better risk takers, but I would rather live a more frugal life and not take chances.

 

[NanoSour]

We have a very conservative portfolio as well. I don't want to gamble with my retirement savings. I am okay with just keeping up with inflation over retirement vs. losing 50% at some point in time.

I read the posts here and I couldn't sleep at night if I invested like most people here. Good for you guys for being better risk takers, but I would rather live a more frugal life and not take chances.

I'm of the same opinion. I have my assets at VG in the "Gone Fishing Portfolio". Don't expect any great returns, but also feel protected against any significant downside risk. My calculations with ESPlanner suggest my standard of living will remain at pre-ER levels with 0% real return; i.e. keeping up with inflation.

 

[tuixiu]

At 51 history would suggest you should probably be using 3% or so, not 4% or 25X unless you plan to expire at age 81.

Why?

I understand it would need to be a lower SWR to achieve same chance of success, but is it really that big a reduction?

When I run firecalc with $1,000,000 stash and everything else default:
40k spending, 30 year retirement = 94.6%
37k spending, 50 year retirement = 96.7%

Wouldn't this indicate if 4% is the comfort baseline for a 30 year retirement then 3.7% would at the very least equal it for a 50 year?

 

[tuixiu]

The thresholds for getting 100% with $1,000,000 and default settings are:
30 years = 35k spending
50 years = 34k spending

I realize I'm greatly oversimplifying, but I can't imagine 30 => 50 gets you anywhere near needing an entire 1% reduction in SWR.

 

[Charlie Delta]

Thank you for the many great responses! Surely a nice bunch of helpful and knowledgable folks here and I will be spending more time here. Sorry for the delay in responding back, I have been up to my eyeballs busy and have been trying to put this out of my head for a while. I didn't know about firecalc, it is by far the best tool I have found and helped me to have a little less worry. I think that once things are settled at the end of this month and I get my finances in order, there will be less stress and worry, once I actually start to live it and hopefully see that I can actually retire and not worry so much about the money! Thanks again for all the great info and opinions!

 

[Ready]

Why?

I understand it would need to be a lower SWR to achieve same chance of success, but is it really that big a reduction?

When I run firecalc with $1,000,000 stash and everything else default:
40k spending, 30 year retirement = 94.6%
37k spending, 50 year retirement = 96.7%

Wouldn't this indicate if 4% is the comfort baseline for a 30 year retirement then 3.7% would at the very least equal it for a 50 year?

At some point, I think around 40 years, it really doesn't matter whether you plan for 40 years or 100 because you are building a model that can theoretically be an annuity where the principal is always in tact. I think the reason for Midpack's suggestion to reduce the SWR for a longer period is based more on the concern that future returns may not be a strong as past returns. Of course nobody really knows what the future holds, but the latest concerns about low bond yields and high stock valuations have some experts predicting a prolonged period of lower returns, and therefore are suggesting that 3% SWR is the new 4% SWR.

Whether you prescribe to this line of somewhat pessimistic thinking is your call, and anybody's guess. Remember that financial predictions are wrong about as often as they are correct.