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Two years into RE, I struggled to not feel guilty over withdrawals. Lately, however, inspried by an ERD50 thread concerning portfolio value fluctuations and after much studying of FireCalc outputs, I've become more comfortable with the fact that there will likely be significant vairation in my portfolio value over time. And that my portfolio will shrink over time. Gimmicks such as buckets, holding large cash balances or extreme diversity don't solve the problem.
I downloaded a number of sample years in spreadsheet format from FireCalc and put middle and ending values into histograms. It's an eye opener! Few "average" outcomes. Many outcomes significantly above or below average and the distributions skewed to the right. Even with a WR that FireCalc indicates would have had a zero failure rate historically, there were lots of close calls and early dips.
In the end, I concluded that variation is something you just have to live with unless you want to buy an annuity or go to something like CD ladders and probably die a slow death to inflation.
After years of accumulating, I try to have money not be an end in itself but rather to live and enjoy my RE while prudently managing my investments.
I downloaded a number of sample years in spreadsheet format from FireCalc and put middle and ending values into histograms. It's an eye opener! Few "average" outcomes. Many outcomes significantly above or below average and the distributions skewed to the right. Even with a WR that FireCalc indicates would have had a zero failure rate historically, there were lots of close calls and early dips.
In the end, I concluded that variation is something you just have to live with unless you want to buy an annuity or go to something like CD ladders and probably die a slow death to inflation.
After years of accumulating, I try to have money not be an end in itself but rather to live and enjoy my RE while prudently managing my investments.