SWR - No Heirs

[RunningBum]

There seem to be a lot of retired people in this forum who report using a 3.5-4% SWR, and their assets are growing. There could be a number if reasons for this or combinations of reasons: (1) people with growing assets like to brag about it (and who wouldn't?), while people with declining assets aren't so eager to write about it; (2) people here are better investors than most; (3) the markets have been rising the last couple of years; and (4) the 3.5-4% SWR is safe for worst case scenarios, which happen only rarely. I kind of think that #4 is a big reason. I plan to use a higher withdrawal rate, and keep a cash cushion of term deposits so that I don't have to sell off holdings in a down market.

#3 for me. Maybe all 4. #2 least likely for me, but as long as I keep from doing anything stupid I'm probably ahead of the game.

 

[utrecht]

All you have to do is set any semblance of a proper AA and then leave it alone. That alone gives you #2 and makes you a "better investor than most"

 

[pixelville]

If you and your spouse were high earners and you take SS at 70 you are looking at about 70k to 75k a year. (Even if you stopped working at around 50-55)

That is plenty to live on.

Unless you ER at 40-45 with 15 yrs of work history only!

A challenge with this approach is when the first one passes away and the impact of reduced income on the surviving spouse.

 

[Options]

My plan "C" (SHTF scenario) involves taxable asset spend down between 60-70, some PF annuitization (SPIA) at 70 to make up for a small deficiency between income needs and amount of SS income delayed until 70, then annuitizing an even smaller amount in approx. 2033 (if necessary) to make up for any possible SS reductions. 3% of leftover PF will more than cover emergencies and inflation increases.