RetirementColdHardTruth
Recycles dryer sheets
I have been running the numbers and based on a 6% average return between now and the next 6 years using my 1/1/2012 starting value as the basis (so excluding the massive gains this year) I could retire at 46 with a WR of 3.4%. I know my personal inflation rate and have been running monthly expenses thorugh a spreadsheet for the last 5 or 6 years. These included replacement of a roof, 2 new cars to replace my 12 year old ones and expenses such as carpet replacement and house painting. These figures would also cover my health care costs as I plan on moving back to Australia where I can get coverage for around 380 a month for the whole family. I assume a 1:1 dollar conversion rate and plan to move into Austalian based investments so that exchange rates wouldn't come into play. If the USD does well over anytime over the next 6 years I would begin that conversion earlier. What I have also noticed is that dividends in Australia across high yielding stocks (ETF) is in the order of 8% or could just move some to CD givng 6% locked in for 10 years with a good portion of the money.
Anyway if I waited until 50 my WR would drop to 2.1% and that means I could live off the interest on fixed income products for life given my assumptions. My question is 4 years extra working worth the massive buffer that comes from it and the security of miving to higher AA in fixed income worth the lost leasure time? I don't really hate my job, but would rather be surfing ofcourse.
Anyway if I waited until 50 my WR would drop to 2.1% and that means I could live off the interest on fixed income products for life given my assumptions. My question is 4 years extra working worth the massive buffer that comes from it and the security of miving to higher AA in fixed income worth the lost leasure time? I don't really hate my job, but would rather be surfing ofcourse.