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Old 08-02-2019, 10:28 AM
 
Location: Black Forest, CO
1,521 posts, read 2,254,508 times
Reputation: 1494

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Quote:
Originally Posted by StealthRabbit View Post
I hope you have some "Investments", because if you are living off of "Savings".... it might be kinda lean.
Yes we have always maxed out our 401ks, and also have additional non-retirement account investments, as well as other things. I think we are ok financially. I also have kept detailed records of what we spend each month for the past 15 years and I know our spending habits (FYI this is a great exercise for anyone out there and I have a pretty easy system I use, but then I am a nerd). Will also have to figure in more for insurance too.
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Old 08-02-2019, 10:30 AM
 
Location: Black Forest, CO
1,521 posts, read 2,254,508 times
Reputation: 1494
Quote:
Originally Posted by SoCal_Native View Post
Just saw you live in Black Forest...I used to live in Kings Deer driving through Black Forest on the way home from Schriever AFB.
Cool - I am near there, east of Kings Deer off County Line.
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Old 08-02-2019, 11:58 AM
 
Location: Miami, The Magic City
2,942 posts, read 2,049,912 times
Reputation: 1965
Definitely a weird feeling...I had a career in sales and measured my success v quota attainment; I am in very good physical shape and measure myself vs the mirror and others; I measured my wealth accumulation v my age and others. Time for new goals. Financially, I had my CPA and investment firms run a cash flow analysis and I will be fine—just need to readjust to the possibility of not reaching new highs in terms of wealth unless I discover a money making hobby or interest and/or my investments outperform my spending.
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Old 08-02-2019, 12:44 PM
 
Location: Scottsdale, AZ
7,931 posts, read 4,863,650 times
Reputation: 29087
My spouse retired in mid-May and seems lost about draws from savings, investments and annuities. It is not a reassuring feeling to know the person who has complete control over our money is unsure what to do. I've tried but he rejects all attempts at gentle education and advice. His iron-clad rule: "We can't have a taxable event!" 70.5 is only two years away and we have multiple 401(k)s. That'll be fun!

So, in order to keep me from climbing the drapes with worry and frustration, I am still working. I have a business I run from home that takes only about half the day. The business was languishing over the last year from neglect but I think I've pinpointed the major issues and started to turn it around.

Retirement is tough for people accustomed to a life that is nothing but a rule-based routine. I get it. There are no rules now. You no longer have a manager. No one works with you to set goals (although they would if you let them). There's no bonus for doing retirement "right." And there's no one to grant you company stock for showing up every weekday.

I've been self-employed for nearly two decades, so I've had to learn to do those things for myself.
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Old 08-02-2019, 01:12 PM
 
72,347 posts, read 72,289,871 times
Reputation: 49867
For those who draw off about 4% and use 50%-60% equities, they have ended 30 years later with more than they started 90% of every 30 year period since 1926...... so there is no reason it has to go down unless you are so equity shy that your money does not grow.

This is our 4th year and we are way higher then the day we started
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Old 08-02-2019, 01:14 PM
 
14,130 posts, read 7,546,700 times
Reputation: 25876
Quote:
Originally Posted by fluffythewondercat View Post
My spouse retired in mid-May and seems lost about draws from savings, investments and annuities. It is not a reassuring feeling to know the person who has complete control over our money is unsure what to do. I've tried but he rejects all attempts at gentle education and advice. His iron-clad rule: "We can't have a taxable event!" 70.5 is only two years away and we have multiple 401(k)s. That'll be fun!

So, in order to keep me from climbing the drapes with worry and frustration, I am still working. I have a business I run from home that takes only about half the day. The business was languishing over the last year from neglect but I think I've pinpointed the major issues and started to turn it around.

Retirement is tough for people accustomed to a life that is nothing but a rule-based routine. I get it. There are no rules now. You no longer have a manager. No one works with you to set goals (although they would if you let them). There's no bonus for doing retirement "right." And there's no one to grant you company stock for showing up every weekday.

I've been self-employed for nearly two decades, so I've had to learn to do those things for myself.

Jeez. Everything is a taxable event.


I just did a straw man 2019 tax return today to figure out how much I should be pulling from my 401(k) this year to stay in a tax-efficient bracket. The 401(k) money that went in was mostly sheltering ~28% and 33% bracket money.



Married, the 12% bracket extends up to $103K AGI. You have a $9K tax bill. Most people can live pretty well on $94K cash flow. Layer in the tax advantage of a couple of Social Security checks and it can be a $100K+ cash flow while still staying in the 12% bracket.
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Old 08-02-2019, 01:24 PM
 
Location: SoCal
13,602 posts, read 6,483,219 times
Reputation: 10169
Quote:
Originally Posted by fluffythewondercat View Post
My spouse retired in mid-May and seems lost about draws from savings, investments and annuities. It is not a reassuring feeling to know the person who has complete control over our money is unsure what to do. I've tried but he rejects all attempts at gentle education and advice. His iron-clad rule: "We can't have a taxable event!" 70.5 is only two years away and we have multiple 401(k)s. That'll be fun!

So, in order to keep me from climbing the drapes with worry and frustration, I am still working. I have a business I run from home that takes only about half the day. The business was languishing over the last year from neglect but I think I've pinpointed the major issues and started to turn it around.

Retirement is tough for people accustomed to a life that is nothing but a rule-based routine. I get it. There are no rules now. You no longer have a manager. No one works with you to set goals (although they would if you let them). There's no bonus for doing retirement "right." And there's no one to grant you company stock for showing up every weekday.

I've been self-employed for nearly two decades, so I've had to learn to do those things for myself.
Does he know he has to withdraw from every separate 401k? He might change his mind about it. Managing your tax rate is better than get torpedoed.
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Old 08-02-2019, 02:27 PM
 
11,630 posts, read 8,513,038 times
Reputation: 7181
Quote:
Originally Posted by mathjak107 View Post
For those who draw off about 4% and use 50%-60% equities, they have ended 30 years later with more than they started 90% of every 30 year period since 1926...... so there is no reason it has to go down unless you are so equity shy that your money does not grow.

This is our 4th year and we are way higher then the day we started
^^^^^this

Plus. it cost money to go to work every day. You might spend more the first couple years doing all the things you saved until retirement. DH retired at 52.

Three years later he started talking part time jobs due to being bored. He had done everything he wanted to do.

We even moved and rehabbed at house at 75.

He'd still take a part time job if anybody would hire an 80 yo man who had had a stroke the caused him
to fall off a ladder from the second floor onto the pool deck. And 2 kinds of cancer.

But he still has employer provided healthcare. Healthcare is the big unknown.
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Old 08-02-2019, 03:08 PM
 
1,737 posts, read 612,134 times
Reputation: 3244
Quote:
Originally Posted by beezle1 View Post
After working and saving our entire lives up to now, how do we transition emotionally to living off our savings? It seems like it will be discouraging to see our savings going down instead of up.
I've been living that scenario for more than a decade and it can be .... disconcerting, to say the least. I went from my highest-ever total income of about $40K gross in 2009 to a net income of about $10K in 2010 because cancer treatment made it impossible for me to work (although not legally qualified as "disabled", the reality was that I could not have handled a job either physically or emotionally during that time. My stress level was off the charts without adding that.) So my income was entirely from savings interest and dividends on investments... but those investments had to be sold off on a continual basis to pay uninsured medical expenses.

2011 was the same... about $8K/yr income from ever-dwindling investments and falling interest rates. I was basically bleeding money on a weekly basis and believe me it was not fun to watch that happen. Meanwhile the property taxes and utilities and food still had to be paid for as well as the medical expenses which were all out of pocket. This was all in my early 60s so no Medicare.

I was really REALLY trying to hold off on taking Social Security until FRA but finally when my total YEAR TO DATE income as of the end of July at age 63 was only $1200 .... I had to file early. I did it under my own name so as to wait to claim my widow's benefit until FRA. This meant that my already-paltry benefit was reduced even more but let me tell you, that $900/month looked like "manna from heaven" at that point. I had been seeing cash flow tens of thousands of dollars in the red for the past several years (during my surgery year it was $135K negative) and so even those few thousand dollars extra per year looked like a lifesaver.

Once I finally reached FRA and was able to switch to the survivor's benefit things got easier. Of course the investment income is long gone and the interest rates have been miniscule (gee thanks Mister Powell for doing me no favors whatsoever this week) on savings but at least now my income almost covers my actual expenses (within a couple thousand of breaking even) nowadays. But compared to what I went through via watching my savings/assets continuously being sucked into a black hole for six years, well, a thousand or two in negative cash flow at the end of the year is tolerable.

Not fun, not desirable, but tolerable. Because I know from experience that it could be (and was) a lot worse.

Last edited by BBCjunkie; 08-02-2019 at 03:16 PM..
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Old 08-02-2019, 03:26 PM
 
1,750 posts, read 636,319 times
Reputation: 1838
I see it this way: at the end of each year, I have one less year left of retirement, ie, one less year to support myself from the savings. If I am spending money at the same rate at which I am spending time, everything is okay, because I will not need my savings after I die (I have no kids, so the best possible way for me to use for my savings is to spend as much as possible. Of course, I have a reasonable budget that can, per historical inflation data, cover my present level of spending til age 100, and a more modest level til 125 which is the theoretical limit of human longevity because chromosomal telomeres cannot re-grow past that age).


I'm kind of refusing to put aside too much of my savings for a possible need for heroic measures to prolong life if seriously sick, or to nursing home plans. In the first case I'll just die, and I am not going to go to a nursing home unless I get so decrepit that I don't care where I am anyway, and could just as well go to a Medicaid facility (though I made arrangements too with my extended family to ship me to a good/inexpensive nursing home in a different country for the latter possibility).
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