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Sounds like you have a good handle on your options.
Retire early? Be sure you know how you will spend your time and that it will be more enjoyable that now.
Re run your financial projections using lower rates of returns. Remember historic rates of return are probably higher than you will earn in the next few years.
Remember sequence of returns. If the market crashes when your retire make sure you have enough "cash" to see you through.
If you can I would delay SS until 70 and spend down your assets. I consider the spend down as buying an annuity for the additional monthly income. Remember this amount can also go to your spouse.
run it through firecalc . you never want to test things using some average return .
that assumes you never spend down at a loss and from best to worst case in real life can be off by as much as 15 years in how long the money will last .
good planning methods revolve around the worst cases we have seen and getting through those .
we have not seen worse conditions in 51 years than portfolio's are stress tested against .
it is always better getting a raise if things are better than taking a pay cut . .
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I have used firecalc and like what I see as far as the success rate.
I just wish there was a little more cushion because I have just reached the end of my desire to work. I have had health issues that appear to have been resolved. I don't want to be the guy that works until that FRA carrot and then dies. I can hear you MJ saying "but what if you live" as you have in other posts and I really can appreciate that but I'm just tired, not happy and want so bad to be done.
We have been frugal all our lives and if anyone can make it, we can. I do own my home in NorCal and if things got tough I could sell and move to a lower COL location. That is my backup plan. But for now we will try to make it in this expensive state of CA, with the help of Prop 13 and see what new adventures await.
Thanks to all of you much smarter than I who share your wisdom. Very helpful and much appreciated!
run it through firecalc . you never want to test things using some average return .
that assumes you never spend down at a loss and from best to worst case in real life can be off by as much as 15 years in how long the money will last .
good planning methods revolve around the worst cases we have seen and getting through those .
we have not seen worse conditions in 51 years than portfolio's are stress tested against .
it is always better getting a raise if things are better than taking a pay cut . .
So what it the commonly recommended portfolio success rate when using Firecalc? 100%, 95%, 90%?
With over 170 scenarios and a thirty year time period it must be nearly impossible to achieve 100% success, meaning that none of the scenarios project a negative investment/savings balance at the end.
Lots of answers never mention a partner or spouse. It's one thing to afford "normal" costs and outlays. It's another thing to afford disasters.
We all need disaster planning unless we want to put likely outcomes completely into the hands of fate.
This becomes even more important if it's "we" and not just "I."
The last thing I'd want to have happen would be for my spouse to suffer after I'm gone, because I wasn't hip to my boss or job, or had a burning desire to leave the rat race, even though a few more years would have positioned "us," and later "her," with a better cash flow.
And if she left me first?
Then I'd have a better disaster plan than I ever would have imagined.
So what it the commonly recommended portfolio success rate when using Firecalc? 100%, 95%, 90%?
With over 170 scenarios and a thirty year time period it must be nearly impossible to achieve 100% success, meaning that none of the scenarios project a negative investment/savings balance at the end.
90 % is good .
there is actually 117 rolling 30 year periods in firecalc going back to 1871 .
of course you can get 100% . 4% failed a few cycles but just drop the draw to the 3.70 % range and it is 100% with a 50/50 mix .. 1907,1929,1937 and 1965/1966 were tough acts and a 4% draw just couldn't do it .
but odds are most of us will not live 30 years in retirement either so once life expectancy statistics are calculated in even 90% becomes close to 100% .
this is 3.70%
FIRECalc looked at the 117 possible 30 year periods in the available data, starting with a portfolio of $1,000,000 and spending your specified amounts each year thereafter.
Here is how your portfolio would have fared in each of the 117 cycles. The lowest and highest portfolio balance at the end of your retirement was $9,719 to $4,420,656, with an average at the end of $1,335,065. (Note: this is looking at all the possible periods; values are in terms of the dollars as of the beginning of the retirement period for each cycle.)
For our purposes, failure means the portfolio was depleted before the end of the 30 years. FIRECalc found that 0 cycles failed, for a success rate of 100.0%.
Last edited by mathjak107; 06-08-2017 at 02:58 PM..
After trying the calculator a few times I finally read the instructions - three times. I found the special tabs mentioned in the instructions at the TOP of the web page, not visible while reading the instructions near the bottom of the page.
After inserting the correct amount for the current value of our investment portfolio, selecting our expenses to equal 100% of my current take-home pay (conservative), planning on a 30 year life expectancy after retirement, adding in my wife's pension to start in two years, adding in my wife's SS to start at her age 65, adding in my SS to start at my age 65, and clicking the box saying I agree we will likely spend slightly less as we age, our results are 100%.
Meaning that even with the most dire forecast we will most likely not exhaust our funds by age 95.
I guess we are good to go!
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