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It is a no brainier for me, 62 and I am taking the cash thank you very much. I got some fishing, drinking and dabbing to do. Mix in a little rving and I am liking the retirement lifestyle. You never know when you will drop dead. Both of my parents died before 70 so........I am not wasting anytime I am going to get some fishing,drinking oh yeah lots of dabbing in before I drop dead. So far so good. Besides money does not make you happy, if you have not figured that out by now you might as well keep on working.
You are correct that money does not (or should not) "make you happy".
But what money does do, is act like "insulation" in the walls of your home, it allows you to stay warm in the wintertime, which for me is one component of being "happy". Insulation does not stop heat loss, but it sure does slow it down. Being able to afford dental care when your teeth hurt, being able to have a choice in what quality food you eat, being able to live in a home and not a beat-up trailer, being able to give your kids a head start through a quality education; not having to drive a car that you're working on at midnight before having to use it to get to work the next morning, being able to help those in a time of trouble who helped you through your own bad times, even being able to afford good veterinary care for your pets - those are definitely all things that "make people happy", and it takes money, and sometimes quite a bit of money, to make those things happen.
It is a mis-quote to repeat the saying "Money is the root of all evil". The proper parable, as I understand it, is "The LOVE of money is the root of all evil", which is a completely different thing. Money is simply a tool, and like my favorite tool (a simple hammer), works best when it is used for its intended purpose. Use it incorrectly, and you end up with a smooshed thumb. Which I've done, and that experience has NOTHING to do with happiness, LOL.
A 50/50 mix would have more then a decade of cash and bonds so selling equities in a down market is not going to happen. You may even be buying equities when rebalancing
Sure you can do that but still as humans those numbers in the account dropping would not be pleasant to see and stick to 5he plan of drawing out.
You are correct that money does not (or should not) "make you happy".
It is a mis-quote to repeat the saying "Money is the root of all evil". .
money is not the root of all evil , actually lack of money is for the most part the root of evil . . money buys choices in life, that is where its greatest value is ..
money is not the root of all evil , actually lack of money is for the most part the root of evil . . money buys choices in life, that is where its greatest value is ..
Amen, Brother.
And, thanks for your input on this thread, I looked at Firecalc on your advice, and love their method of running every historical performance scenario for a particular starting nut and take rate, even allowing for different inflation rates for the take. That was a lot of data crunching on their part, it's a great resource.
Amen, Brother.
And, thanks for your input on this thread, I looked at Firecalc on your advice, and love their method of running every historical performance scenario for a particular starting nut and take rate, even allowing for different inflation rates for the take. That was a lot of data crunching on their part, it's a great resource.
it is an excellent tool and helps you prepare to meet the worst of times we have had ..anything better then worst case is a plus in the plan .
make sure you change the default portfolio allocation to match your plan . the default is 75% equities .
because a safe withdrawal rate is based on the worst of times it is important to look at where you are as time goes on so you can take raises .
most calculators are useless as they ask you to predict some average return . average returns don't work when spending down because the sequence's of the gains and losses can see the same average return run out of money 15 years sooner between the best sequence and the worst , with the same average return .
so safe withdrawal rates are based on the worst outcomes you can have .. those outcomes were so bad that 90% of the time at a 4% inflation adjusted draw you ended 30 years later with more then you started with and 67% of the the time more then 2x what you started with ... most of these silly media articles that question the 4% safe withdrawal rate working have no idea what it even represents .
mathematically all you need to sustain that draw is a 2% real return average the first 15 years and you are good to go .
don't confuse predicting some average return , with what you actually need to get as an average for the math to hold ... what you need for the math to hold is not a prediction , it is your actual outcome you are seeing .
Last edited by mathjak107; 06-16-2019 at 04:15 AM..
An interesting side note here I picked up on, is both a bear and bull market apparently are bad reasons to delay filing!
If it is a bear market, watching your portfolio drop while pulling out more to approximate your future SS is bad.
If it is a bull market, then you could do much better by filing early and investing it and the added portfolio increase makes for more income than delaying would.
So does that mean that the only time it makes sense to delay (for the increased income factor ONLY) is when the market is just floating, or if you are working?
I have to admit that I personally don’t know anyone that had delayed to 70 having retired before 62 and used their portfolio to delay.
I have said the same thing that mathjak said he actually did. Understanding and believing the math is one thing. But at a certain point it has GOT to be very hard to watch your portfolio drop or under perform each month when you know there are fat checks not being claimed for a lower risk future that may never come....
The key is to realize that of it only increases all the time, then you are certainly not using it for maximum income. I would hope that I would have no problem watching it underperform, or even drop, as long as it was still “more than enough”.
it really ends up being more psychological then mathematical .
it is like how we can make all the hypothetical plans and strategies we like . they all sound good and sound like they will work .
but as we saw in the research done by jason zweig , once real money is on the line a different part of our brain takes over which is not very logical .. it will force you to do things that were not in the hypothetical plan .
i always thought i would delay to 70 . why not ? we didn't really need the payments now .
but like i said , watching that balance drop as we spent down when i could easily stem the bleeding by taking ss earlier really made little sense after a while mentally .
money is not the root of all evil , actually lack of money is for the most part the root of evil . . money buys choices in life, that is where its greatest value is ..
I suppose it all depends on how you define "evil". (I won't pursue this here)
I really love work and may not be ready to retire at 62. Otoh, I might feel differently in 3 1/2 yrs.
And you might feel a LOT differently if your situation requires that you shop for health insurance at age 62.
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