Long-time lurker; signed-up to ask the occasional question.

[GamblingMan]

Long-time lurker and I finally signed-up.
I booked-marked the 'funny joke Thursday' thread at page 119, probably when I was surfing for an explanation to a joke.
For whatever reason, I browse the forum when I at work, but almost never at home, so it took me a bit to actually sign-up while I was at off-work.

While I am not retired, and not really close to retirement, I do have some experience with the subject, learned from helping my parents get through it.
(e.g. Social Security, Medicare and medical, retirement withdrawals, and aging)

I am more comfortable talking in percentages (i.e. X% of income) than hard numbers.

I am not as complicated with retirement investing, as a lot of the members of the this forum seem to be. My risk tolerance maxes out at mutual funds.

I am not sure if I am the right fit for this forum. Early Retirement means to me, anything before Full Retirement Age. I already have a retirement number($) in mind, but most calculators don't think I'll make it, unless I work past FRA (not going to happen). So my plan is to retire with whatever I have at the appointed time, and try and make it work.

Still, sometimes retirement questions pop in up in my head. For example, what inflation number does everyone use in their calculators(?) (I currently use 3.5%, up from 3.0%, during the 'good' inflationary days.)

 

[MarieIG]

Welcome to the forum GamblingMan.

I retired the end of 2021 and had been using a 3% rate when I retired. Your choice of 3.5% seems reasonable to me - although others may feel differently. You certainly do not have to share hard numbers if you are not comfortable so doing, percentages are fine. As far as mutual funds go, you can certainly prepare for retirement vis-a-vis mutual funds options.

As far a ages go, this forum is for people of all ages.

 

[MichaelB]

I am not sure if I am the right fit for this forum. Early Retirement means to me, anything before Full Retirement Age. I already have a retirement number($) in mind, but most calculators don't think I'll make it, unless I work past FRA (not going to happen). So my plan is to retire with whatever I have at the appointed time, and try and make it work.

Still, sometimes retirement questions pop in up in my head. For example, what inflation number does everyone use in their calculators(?) (I currently use 3.5%, up from 3.0%, during the 'good' inflationary days.)

GamblingMan, if you want to retire someday you are the right fit.

As for inflation, there is no simple answer. Some use the historical average. This is the default for FIRECalc. Others use their own number, so there’s no right answer.

The rate of inflation matters more if your portfolio is mostly fixed income. If your portfolio has a mix of equities and fixed income other factors matter more than inflation.

 

[disneysteve]

My risk tolerance maxes out at mutual funds.

Welcome.

Mutual funds run the gamut from extremely conservative to wildly speculative so saying that doesn’t really indicate your risk tolerance.

If the calculators show you won’t hit your goal you need to keep playing with the numbers and the plan. Spend less, save more, work longer, invest more aggressively, etc. Keep tweaking and running different scenarios to see which gets you closest to “the number” or what changes you can make to be secure with less.

Good luck. This group is great at answering questions and helping people figure it all out.

 

[Jerry1]

Welcome to the forum. First, if you’re thinking about early retirement, you’re in the right place. It’s hard to accomplish the goal if you don’t think about it early, as you are doing.

As for how to do it, remember, there’s a few different legs in the retirement stool. There are the income legs that consist of pensions and returns from your investments. There’s social security. And, there’s life style. One way to get out early is to be brutal when it comes to your expenses. When you’re modeling your retirement, don’t just focus on how much you need to retire, run some scenarios to get an idea of how much you have to reduce your projected spending to get the model to show success. Remember, you may never have to actually live at that number but it will be good to keep a floor in mind as you evaluate your options.

 

[EastWest Gal]

Welcome to the forum. We are friendly group. Some people here end up retiring not early but most of us aim to retire before full retirement age (FRA). But this forum and the information on it can give you ideas on saving, investing, and living (cooking, grilling, DIY projects, etc.). One of the most useful tools here is FireCalc. It's in the banner at the top. I invest in index funds, mostly ETFs. They provide the greatest diversification, which lowers risk substantially.

 

[Diogenes]

...Early Retirement means to me, anything before Full Retirement Age. I already have a retirement number($) in mind, but most calculators don't think I'll make it, unless I work past FRA (not going to happen). So my plan is to retire with whatever I have at the appointed time, and try and make it work.

When I first joined, it was my assumption that the target demographic was around 50-55... and that once folks aged into the more traditional bracket, they'd be less inclined to self-identify as "early". Thus far I have found that the more active members do in fact tend to be older, and to have been already retired for quite some time.

For an employee with 35 years of Social Security earnings and a presumed "decent" salary, one supposes that, upon reaching Full Retirement Age, Social Security alone would actually be enough to cover most (if not all) expenses. Thus the trick becomes, how to fund one's life between actual retirement-age and FRA... while still preserving one's portfolio, if one cares for such things (most do).

A related question is, to what extent we view our careers are our identity, and how that juxtaposes with the whole concept of retirement... something to ponder, at any age.

 

[audreyh1]

Welcome to the forum.

There are many many posters and retirees here who have used mutual funds for investing before and during retirement. Many folks with very simple portfolios. No issues there.

Many also consider any time before full retirement age to be retiring early.

 

[sdtech]

As I got closer to retirement I found the combination of this site and bogelheads gave me the best access to advice and subjects that were revelant.

 

[Exchme]

Welcome to the forum. I think you'll fit in just fine, whether retired early or not yet retired at all. The moderators do a great job of allowing conversations to be wide ranging as long as they don't get contentious. I agree with 'sdtech' that bogleheads is another great source of information, though the conversation there is much more restricted to just investing and money.

I'm not sure what percentage of folks really have exotic portfolios. I think it's more that the moderators encourage conversations on a wide range of topics. The mods reserve the Active Investing sub-forum for those folks so they can share ideas unhindered by us indexers. Us indexers would probably drown them out or at least argue with them too much.

You can see what the market predicts for inflation by looking at the real yield of TIPS. That's around 2%, so that's the inflation number I use. If you believe that inflation will be 3+%, then switch your fixed income to TIPS!

 

[wrigley]

I'm 64 and still working full time. I have been visiting this site for many years. I know there will come a day when I'll retire, and I learned a lot from the people on this site. Soak up the knowledge that is here and one day you too will retire.

Mike

 

[Surewhitey]

I'm a 3% guy on inflation. Figured if it's higher than historical, it is a good start.

You'll find this bunch has a very wide & deep knowledge (opinion) of just about anything from tax law to building kayaks. Don't be afraid to ask a question... But searching the site is a good first start...

 

[old medic]

Welcome to a great group of folks with tons of information. I joined to inform myself, and a year and a half later, I was retired.

 

[TickTock]

For an employee with 35 years of Social Security earnings and a presumed "decent" salary, one supposes that, upon reaching Full Retirement Age, Social Security alone would actually be enough to cover most (if not all) expenses.

SS is not designed to cover all of a retiree's expenses, and the replacement rate goes down as income goes up.

[AARP article: How Much Social Security Will I Get? ]

Summary: SS actuaries in 3/2023 calculated replacement rates for workers claiming benefits in 2024 for various income ranges.

• 78.9 percent for someone with “very low” career earnings (defined as an average of $15,867 per year).
• 57.4 percent for someone with “low” average earnings ($28,561 per year).
• 42.6 percent for someone with “medium” average earnings ($63,496 per year).
• 35.2 percent for someone with “high” average earnings ($101,550 per year).
• 28 percent for someone with “maximum” average earnings ($156,274 per year).

 

[pacergal]

Welcome to the forum!
I retired at age 60, not as early as many members here, but 5 years earlier than I thought I could.
So, it was early to me!
Save, invest, LBYM is how I got here. DH and I also had jobs with pensions, so we were more SIRE than FIRE.
There are members here with under a million dollars saved and those with multi millions. We are all here to learn, share and enjoy each others company.

I think having a budget/spending plan is crucial.
Have you run Firecalc? It has options to see how well your plan would be based on history, plus the ability see what your see spending number is. Play around with it.

Feel free to ask any questions. there are so many knowledgeable folks here willing to share and answer questions. They certainly have helped me.

And feel free to join in on other forums. It is a great place to learn, share, and it is friendly. The moderators are wonderful in assisting in that area.

 

[BadgerNCarolina]

Long-time lurker and I finally signed-up.
I booked-marked the 'funny joke Thursday' thread at page 119, probably when I was surfing for an explanation to a joke.
For whatever reason, I browse the forum when I at work, but almost never at home, so it took me a bit to actually sign-up while I was at off-work.

While I am not retired, and not really close to retirement, I do have some experience with the subject, learned from helping my parents get through it.
(e.g. Social Security, Medicare and medical, retirement withdrawals, and aging)

I am more comfortable talking in percentages (i.e. X% of income) than hard numbers.

I am not as complicated with retirement investing, as a lot of the members of the this forum seem to be. My risk tolerance maxes out at mutual funds.

I am not sure if I am the right fit for this forum. Early Retirement means to me, anything before Full Retirement Age. I already have a retirement number($) in mind, but most calculators don't think I'll make it, unless I work past FRA (not going to happen). So my plan is to retire with whatever I have at the appointed time, and try and make it work.

Still, sometimes retirement questions pop in up in my head. For example, what inflation number does everyone use in their calculators(?) (I currently use 3.5%, up from 3.0%, during the 'good' inflationary days.)

Personally I think this is the most important factor in retiring when you decide. The 'number' has always been a silly way to look at it for me, as I think the most important thing is simply having enough yearly income in retirement to cover expenses. That can be with a number, with a pension plus a number, a pension plus ss plus nothing, with real estate passive income, whatever. The important part is that you are flexible on the spend side and you have a reasonable plan to adjust if things go sideways.

 

[Sunset]

Welcome.
Things I wish I had done earlier:
Track my spending (not budget) but know exactly what is being spent on what. Was eye opening.
Invest inside Roth account instead all in IRA/401K
Buy ETF's (broad index ones) instead of expensive funds.

One thing I'm glad I never did: have a brokerage manage my fund for only 1%->2% of value

 

[Lorenzo]

I am not sure if I am the right fit for this forum. Early Retirement means to me, anything before Full Retirement Age.

I felt like I might be out of place, too, but as others have pointed out the ages here (at least of the most active members) tend toward higher than you might think. I agree with your definition of "early." If one can retire before the traditional (in the US at least) age of 65, even if it's only a year or two earlier, that's an accomplishment.

 

[Taxman59]

I started on this site when I was about 5-10 from expected retirement. After reading what others had done, some luck with the market, and a little belt tightening, I pulled the plug just over 9 years ago at 56. I looked at the expenses I had, what would continue into retirement, and what new expenses would arise (think travel and gifts to grandchildren), and decided that the headaches of the job just weren't worth it, and pulled the plug when I was at a 90% projected success rate. With the run in the market the past 9 years, I have more $$ than I projected I would have (even more that I started with!!) and have given $$ to grandchildren and children that wasn't planned. This is a long way of saying that some will retire with $$$$ and some with $. If you are ready mentally, you can find a way to make the money work.

Welcome to the Forum.

 

[Koolau]

Welcome to the Forum. We never judge anyone on when they actually retire. "Early" is a state of mind.

19 years ago when I ran FIRECalc for the last time before pulling the plug, I used 3%. 3.5% is probably a good number.

Welcome to the Forum. Please don't be a stranger here. We look forward to your inputs.

 

[Diogenes]

Summary: SS actuaries in 3/2023 calculated replacement rates for workers claiming benefits in 2024 for various income ranges.

• 78.9 percent for someone with “very low” career earnings (defined as an average of $15,867 per year).
• 57.4 percent for someone with “low” average earnings ($28,561 per year).
• 42.6 percent for someone with “medium” average earnings ($63,496 per year).
• 35.2 percent for someone with “high” average earnings ($101,550 per year).
• 28 percent for someone with “maximum” average earnings ($156,274 per year).

Not to derail the thread, but for aggressive FIRE-minded savers, it is well within scope to be earning around $150K but living off of less than $30K, other than income taxes. This means that if some utter catastrophe visits an investor, with 100% wipe-out of the portfolio... but the person nevertheless makes it to FRA with a good earnings history, and has only SS left... then our hero may quite possible experience a pay raise. The portfolio is gone, but the spendable income actually... increases. It's just a matter of transitioning from W2 + savings, to SS and no more savings.

Though it might contravene the premise of this Site, it could still be of relevance to the OP, to note, that our retirement system is exquisitely well-suited to rewarding the elderly and punishing the comparatively young. I mean this not as a rant, but as a non-normative observation. The sheer fact of making it to age 67, is an enormous boon, even if we're lousy at savings or investment... while having an impressive boatload of money, but being only 45 or 50 or even 55, and exiting the workforce, means bevy of taxes, unsubsidized healthcare and so on.

If the fairy godmother ever visits me, I'd ask her not to make me richer, but older.

 

[TickTock]

You said: "For an employee with 35 years of Social Security earnings and a presumed "decent" salary, one supposes that, upon reaching Full Retirement Age, Social Security alone would actually be enough to cover most (if not all) expenses." No mention of savings rate.

Add, 'for someone who lives off of <20% of their income excluding taxes' and sure SS will cover it. With that kind of savings rate for 35 years SS is likely to be a very small % of SWR from their portfolio.

 

[Koolau]

You said: "For an employee with 35 years of Social Security earnings and a presumed "decent" salary, one supposes that, upon reaching Full Retirement Age, Social Security alone would actually be enough to cover most (if not all) expenses." No mention of savings rate.

Add, 'for someone who lives off of <20% of their income excluding taxes' and sure SS will cover it. With that kind of savings rate for 35 years SS is likely to be a very small % of SWR from their portfolio.

My mom's SS ca 1995 was around $1000/month. And she saved a fair amount of it. That is, until she needed full time memory care in a facility.

Some people just don't need much income to survive comfortably.

 

[Texas Proud]

Do not worry if you do not retire early.... this site helps out no matter when you retired or with how much...

There will be a day when you will sign up for medicare... and SS... and take RMDs... and heck, try to decide if you should have a mortgage (just threw that in for fun)...

And some people just do not know how... I have a brother who is 70 and still working.. he retired a few years back but got offers that he liked... he works from home on his schedule and has told them if they want him in the office he resigns that day... and he is getting more money than he ever got.. .have been recruited heavily...

OHHH, and also has more money than his 5 siblings who all are retired combined...

 

[Diogenes]

You said: "For an employee with 35 years of Social Security earnings and a presumed "decent" salary, one supposes that, upon reaching Full Retirement Age, Social Security alone would actually be enough to cover most (if not all) expenses." No mention of savings rate.

Add, 'for someone who lives off of <20% of their income excluding taxes' and sure SS will cover it. With that kind of savings rate for 35 years SS is likely to be a very small % of SWR from their portfolio.

Of course. My whole point is that for such frugal savers, there is a strong demarcation, depending on age. Reach enough age, and then, clucking-and-fussing over the success of our portfolios is more of a vanity exercise. Even horrific failure won't destroy the floor under our feet. Even having been an unsuccessful investor, while regrettable, isn't catastrophic... because we're used to a low level of spending, and that level is already covered by SS.

But for persons retiring 10 or 15 or however many years earlier, well, there the whole game is about successful investment. We retire from our day-jobs and become as it were professional money managers.