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Old 08-25-2017, 04:19 PM
 
Location: SoCal
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What do you by nothing. They are earning over 1.5%, that's the latest Rate from some online account.
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Old 08-25-2017, 04:21 PM
 
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Quote:
Originally Posted by DaveinMtAiry View Post
Yeah I'm with MJ. While I can certainly see the logic in a cash buffer to avoid withdraws when the market is down 3 years of living expenses in cash is a crazy amount of money earning nothing for years.


As for the initial topic I have been playing around with the Firecalc models and found that over 4% worked out something like 90% of the time in any market.
of course that depends on allocation .
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Old 08-25-2017, 04:22 PM
 
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Originally Posted by NewbieHere View Post
What do you by nothing. They are earning over 1.5%, that's the latest Rate from some online account.
1-1/2% is a drag . ftbfx is up 3.70% ytd ,more than 2x that .it has been more than 3x the last 5 years too .

so you can see it would have been better to avoid cash and just sell from bonds or stocks and rebalance the difference to fund your cash .

in fact if you were 100% stocks and started each year with 2 years cash refilled , you can see just spending from stocks would have left you higher .

i start each january with 2 years cash and spend down to 1 year each year and refill . not the best performance wise but it gives me a better feel for where we stand spending wise .
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Old 08-25-2017, 04:34 PM
 
Location: SoCal
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My trading account is also my cash account. It has earned more than 3.7%. It's my checking account that earns nothing.
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Old 08-25-2017, 04:35 PM
 
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what cash account earns 3.70% as cash sitting there ? if you are trading with it and earning money it is not apples to apples , it isn't cash instruments . the return falls under invested money and is at risk while invested the same as the other money invested . .
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Old 08-25-2017, 04:47 PM
 
Location: SoCal
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At this moment it has a lot of cash. It's my gambling account. Not sure I would consider it as investment.
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Old 08-25-2017, 04:54 PM
 
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if you are talking cash instruments you can't count it including money earned in other investments for the purpose of this discussion , cash means cash instruments in this case , not invested sometimes money. this discussion is about maintaing a bucket of only cash instruments SEPARATE from your bonds and stocks .
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Old 08-27-2017, 01:53 PM
 
Location: On the road
5,987 posts, read 2,912,200 times
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Originally Posted by NewbieHere View Post
I never pay attention to these rules. Good thing, because I just spend what I need.
It is wise to make sure "what you need" comes in at a reasonable safe withdrawal rate.

Anyone could sit there blindly withdrawing saying that is what they need, but when they end up broke because they didn't consider anything but the spending portion of the equation there would be some serious regret. Cat food tastes terrible.
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Old 08-27-2017, 02:00 PM
 
Location: SoCal
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Quote:
Originally Posted by lieqiang View Post
It is wise to make sure "what you need" comes in at a reasonable safe withdrawal rate.

Anyone could sit there blindly withdrawing saying that is what they need, but when they end up broke because they didn't consider anything but the spending portion of the equation there would be some serious regret. Cat food tastes terrible.
Luckily, it's still under 4%, maybe even 3.5% or even less. I can always cut back. I've done it before. Right now I have no restriction and it still good.
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Old 08-27-2017, 05:42 PM
 
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the idea behind a safe withdrawal rate is not to have to take a pay cut .


it is to set a floor where taking raises is about 90% more likely .
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