TrophyHusband
Dryer sheet aficionado
Due to an injury I've made the decision to retire. However, as I'm getting my financial house in order and checking investments, FireCalc, SWR, etc. I'm unsure as to when to determine what my actual Safe Withdrawal (SW) amount will be.
To be clear, I know what my SW rate is, but I don't know when to actually determine what the SW amount (SWR x retirement/investment account value) is. Is it the day you retire, the day you run out of cash, the day you make your first withdrawal from a retirement/investment account? Especially important considering the volatility of the market over the last several weeks where our retirement/investment accounts moved significantly over a period of 3-weeks. Determining a SW amount on July 17th (DJIA 41,198) would have been significantly different than on Aug 5th (DJIA 38,703).
For example, if my total retirement/investment account assets are;
- Today (Aug 16): $5M
- Retirement date (Aug 31): $4.5M
- Date when cash reserve accounts are zeroed (Nov 1): $4.8M
- Date when first withdrawal from retirement/investment accounts occurs (Dec 1): $5.2M
When would I determine my SW amount?
Note: The numbers above are just examples. I do not expect to actually experience a 10% swing in value between Aug 16 and Aug 31 nor do I know the value of the accounts in Nov or Dec.
To be clear, I know what my SW rate is, but I don't know when to actually determine what the SW amount (SWR x retirement/investment account value) is. Is it the day you retire, the day you run out of cash, the day you make your first withdrawal from a retirement/investment account? Especially important considering the volatility of the market over the last several weeks where our retirement/investment accounts moved significantly over a period of 3-weeks. Determining a SW amount on July 17th (DJIA 41,198) would have been significantly different than on Aug 5th (DJIA 38,703).
For example, if my total retirement/investment account assets are;
- Today (Aug 16): $5M
- Retirement date (Aug 31): $4.5M
- Date when cash reserve accounts are zeroed (Nov 1): $4.8M
- Date when first withdrawal from retirement/investment accounts occurs (Dec 1): $5.2M
When would I determine my SW amount?
Note: The numbers above are just examples. I do not expect to actually experience a 10% swing in value between Aug 16 and Aug 31 nor do I know the value of the accounts in Nov or Dec.