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It all depends on your lifestyle in retirement. You can try to maintain your preretirement lifestyle, and to do that you would need at least 80% of your preretirement income and draw-outs from investments. If you wish to keep up a cushy lifestyle, the million bucks on top of SS/pension is probably on the low side.
If you scale back your spending to say 60% of what you spent before retirement, and do such things as sell your big unneeded home and buy down, you'll have another big chunk of money to go into savings and can draw on that, reducing further your need for "income."
If on top of that you do things like move to a place with very low property tax (with property tax breaks for seniors), and further, go from two or three cars down to one for the household, you're not really depriving yourself so much but are further decreasing your needed level of "income." Many people decide to trade household expense for expanded travel expense, by going into a very small house or apartment/condo and being frugal at home.
Everyone has different material "needs." Those who have huge needs need huge income.
It all depends on your lifestyle in retirement. You can try to maintain your preretirement lifestyle, and to do that you would need at least 80% of your preretirement income and draw-outs from investments. If you wish to keep up a cushy lifestyle, the million bucks on top of SS/pension is probably on the low side.
If you scale back your spending to say 60% of what you spent before retirement, and do such things as sell your big unneeded home and buy down, you'll have another big chunk of money to go into savings and can draw on that, reducing further your need for "income."
If on top of that you do things like move to a place with very low property tax (with property tax breaks for seniors), and further, go from two or three cars down to one for the household, you're not really depriving yourself so much but are further decreasing your needed level of "income." Many people decide to trade household expense for expanded travel expense, by going into a very small house or apartment/condo and being frugal at home.
Everyone has different material "needs." Those who have huge needs need huge income.
I think the point is you throw out things like "you need 80% from investment" or you need 1 Million dollars.
The point is you have no evidence so you shouldn't be making these claims which are nonsense.
[quote=newenglandgirl;22636236]It all depends on your lifestyle in retirement. You can try to maintain your preretirement lifestyle, and to do that you would need at least 80% of your preretirement income and draw-outs from investments. If you wish to keep up a cushy lifestyle, the million bucks on top of SS/pension is probably on the low side.
I think you hit it out of the park here. Stopping working has lowered our expences and have found that even taking trips has not stretched the budget. So it all comes down to thinking about your haves,must haves, and special haves.
We took a somewhat novel approach by reducing our lifestyle basics over the last 10 years to about 50% of what we could 'afford', lifestyle wise. Our projections are that we can easily return to the could have lifestyle once retired. Now, at retirement in 23.5 months, the Lord willing, and continued good health, we canlive it up!
And, if need be, since we'd acclimated ourselves to a more frugal lifestyle, we could return there if circumstances necessitated such a change.
Always interested in new information, so will definitely read the article.
What happens if you need a couple million for uncovered cancer drugs or you feel a little mushy one day and drive over a herd of crippled schoolchildren and run out of insurance?
Five million is the bare minimum reserve. After you have more you can think of very small withdrawls.
I think the point is you throw out things like "you need 80% from investment" or you need 1 Million dollars.
The point is you have no evidence so you shouldn't be making these claims which are nonsense.
Isn't the real point that nobody has a crystal ball to tell them things like how their investments will do in the future, how much money they will need to cover unexpected expenses, or how long they will live.
Thus, even though there is no 'one size fits all' formula, there are some general guidelines based on logical, mathematical standards.
What do you recommend, if not a 4% withdrawal, 80% investment or $1M 401K ... and what is the basis for your recommendation? --- one that isn't 'nonsense!'
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'Nonsense' may be better than no plan at all.
