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Old 12-22-2015, 08:21 PM
 
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For those currently retired which seems more important. A set amount of money or a set income?
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Old 12-22-2015, 09:43 PM
 
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Originally Posted by Caltovegas View Post
For those currently retired which seems more important. A set amount of money or a set income?
For us they go hand in hand and fortunately we have both. If only having one the it would be the one that yielded the highest annual income weighted by long term security of which is confusing.
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Old 12-23-2015, 03:24 AM
 
Location: Central Massachusetts
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Originally Posted by Caltovegas View Post
For those currently retired which seems more important. A set amount of money or a set income?
As TuborgP says they go hand in hand. The set amount of money in place of pensions will need to be higher than those with pensions. COLAs are a factor in pensions as well. One last is health. All of those have a direct effect on income.
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Old 12-23-2015, 09:46 AM
 
Location: VT; previously MD & NJ
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For me it's a set amount of money. From that comes "income."

When I first retired and rolled my 401k to an IRA, the advisor was pushing an annuity with the assumption that I would jump at the idea of steady income. I said thanks but no thanks, I can manage to withdraw what I need when I need it myself.
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Old 12-23-2015, 09:54 AM
 
Location: Sierra Nevada Land, CA
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Originally Posted by Caltovegas View Post
For those currently retired which seems more important. A set amount of money or a set income?
Income is forever.

Set amount? Depends on what that "set amount" is. How it is invested and other factors. After the crash of 2008, I would hate to be dependent on a set amount. We lost about 35%.

Our situation is we have the "set income" and our "set amount" is basically a reserve that we plan to rarely touch.
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Old 12-23-2015, 07:15 PM
 
Location: Columbia SC
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The problem with set income is you could outlive its buying power assuming fixed for the rest of your life. The younger one is, the less attractive it is.
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Old 12-24-2015, 06:41 AM
 
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Originally Posted by Mr5150 View Post
Income is forever.

Set amount? Depends on what that "set amount" is. How it is invested and other factors. After the crash of 2008, I would hate to be dependent on a set amount. We lost about 35%.

Our situation is we have the "set income" and our "set amount" is basically a reserve that we plan to rarely touch.
Would you prefer 30k of fixed pension income or 3 million available for drawdown? In this case probably the 3 million. Also one is more liquid than the other so if only fixed to live off yup give up liquidity for large expenses.

Not sure about everyone but I know for many liquid assets are essential and that factors in the equation.
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Old 12-24-2015, 06:48 AM
 
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Originally Posted by johngolf View Post
The problem with set income is you could outlive its buying power assuming fixed for the rest of your life. The younger one is, the less attractive it is.
That is why we have a built in COLA provider in using investment income to generate future COLA's. A factor of 3 or better times fixed income should work. You would only need a one percent return average to generate a 3 percent self COLA. The factor you have determines the COLA at one percent ROI
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Old 12-24-2015, 07:37 AM
 
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i say that because when i first bought treasury's i had to look up to see if their was any advantage to buying secondary ones at a discount tax wise .

but as you would expect , none .
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