Lewis Clark
Thinks s/he gets paid by the post
- Joined
- Aug 2, 2018
- Messages
- 1,034
Crap! I've been FIREd for 6 years with around $1M and a pension! What am I gonna due ya'll!
Time to start investing in lottery tickets. : )
Crap! I've been FIREd for 6 years with around $1M and a pension! What am I gonna due ya'll!
So much of this stuff I read about the FIRE "movement" is talking about those trying to drop out of the workforce at age 30-ish or even younger. Without running numbers in firecalc, I tend to agree that $2M probably wouldn't cut it to support a 40- or 50-year retirement, at least to maintain a typical middle-class American lifestyle and raise children.
But how many people actually FIRE at age 25 or 30? (Kudos to any here who accomplished that without winning the lottery!) Meh, more financial porn.
Well, apparently inflation raised her number from "$5 million or $6 million, maybe $10 million" to $20 million in under a year. She's laughable now more than ever. She must be upset that Dave is getting more headlines than she is with clickbait titles.
I know we discussed this here, as did most other FIRE boards when she said it last year.
https://finance.yahoo.com/news/t-lost-compounding-suze-orman-120000501.html
But she explained that it would take a lot of money to make retirement work at, say, age 35.
"You need at least $5 million, or $6 million," she said. "Really, you might need $10 million." In her opinion, anything less wouldn't offer you enough protection from a potential financial catastrophe, like an expensive illness.
Wait a minute, the context was
So if you retired at 35 today (or in 2018), you probably won't get much in SS, and SS might get affected (taxed, reduced) for someone who is 35 today (30+ years from FRA).
That's a lot of years of health care to cover, and who knows what might happen between now and Medicare?
https://www.census.gov/library/publications/2023/demo/p60-279.html
"Real median household income was $74,580 in 2022".
At age 35, I'm going to say it might be prudent to hold $1M in 'reserve' and let it grow (or w/o 'compartmentalizing', reduce your WR to 80% of plan).
Let's add in $10K for health care, and say $85K Inflation Adjusted Withdrawal Rate (IAWR), and ignore SS. An IAWR of 3.3% seems to be on the edge of a 'forever' plan, so 80% of that is 2.64%. And 85,000 / 2.64% requires a $3.2M nest egg.
So OK, *maybe* $5M is high, but there sure are a lot of unknowns between 35 and EOL.
-ERD50
+1I find that many, possibly most, yahoo articles are too shallow to be useful.
Two million is penny to her! dang
That point is with this new article, even if you accept what she said barely 8 months ago, it's meaningless, because today, if you continue to accept what she says, you need $20M.
It's clearly clickbait and nothing more.