Looks like I need 6.2M to retire

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:And maintain current $250K income. Well, I only have 3.2 at 53 outside of home (no mortgage). What’s the best way to manage the next 10-15 years to meet this goal?

how does one come this far in life and need to crowd source these questions?

your money will double in 10 years if you do absolutely nothing . 🤦🏻‍♀️

Ugh...it's comments like these that make me wonder when we will have the next era of horrible stock market performance.

Tell that to the folks that put their money in the stock market in 1965, only for the market to drop 70% through 1982.

yea and by 1986 it had doubled from 1982, 1995 doubled again from 86, 2 year later in 98 it doubled again.

you have good years and bad years. I’ve been investing since 1999 and my annual growth and dividends from stocks now outpace my w2 wage slave income and I’m 49yrs old.

This is dangerous thinking. If you retired in 1965 and lost 70% of your investments through 1982, AND were having to have additional losses to fund your yearly expenses, you will probably never recovered in our lifetime.

We are discussing RETIREMENT on this thread, not being 30 and living through massive corrections. Two very different scenarios.

This is my biggest concern. Sequence of Return Risk. Retiring into a downturn, correction, crash. It is well documented and a must-understand for people who invest.
Sequence of returns risk is the risk of negative market returns occurring late in your working years and/or early in retirement. At this stage of your investment life, market downturns can have a much more significant impact on your portfolio and your lifetime income strategy.

Yes, it's why you have to diversify and cannot just snooze and think you will get truly "passive" income. Likely you want a combo of long term funds, some rental income, and some short term trading (work to do) to hedge against risks. You are basically going to have to "work" to keep your money you already earned, saved and often paid taxes on. It's the sh** system we live in.. The work never ends.

[Anonymous]

Sequence if returns risk is why I will probably never feel comfortable retiring. I have enough to retire but not enough to retire into a prolonged down market..

[Anonymous]

You don’t need the same income in retirement.
For example, you won’t have to contribute to retirement savings any longer.

Ideally, you won’t have mortgage payments at that point. You will also have social security income.

Something is off with your calculations. Don’t you have an advisor?

[Anonymous]

Anonymous wrote:Sequence if returns risk is why I will probably never feel comfortable retiring. I have enough to retire but not enough to retire into a prolonged down market..

My advisor has me keep two years worth of liquid funds outside of the market, so I would not have to tap in if there was a downturn.

They have not historically lasted that long.

[Anonymous]

Anonymous wrote:

Anonymous wrote:I thought conventional wisdom says you need 10xs your income. So you need 2.5

No, conventional wisdom is 30x your income, or less conservative, 25x your income.

Ridiculous (for one person),

[Anonymous]

Anonymous wrote:I think the average person near retirement has way more money than they think they have.

I have no money. But I started adding up my none money and it adds up.

I have a few 401Ks some from old companies They are 2 million. My wife has not worked in years but she has an old 401k worth one million I found, also found a old 100K cash balance pension, 400K in old stock grants, 300k in CDs that are rolling, and old brokerage account for 120k and another old brokerage account with 1.5 million, a left over 529 with 70K and some old Ibonds worth 20K. I even realized my 4 paid off cars are worth over 100k.

People should add up their lost money. Throw in home equity which is at least one million most people you should be fine even if you retire penniless.


You “found” one million dollars?

Sometime is very off with your family’s way of doing things.

[Anonymous]

General investment logic says investments should double every 7.5 years. In 15 years you'll have the 6.5m.

[Anonymous]

Anonymous wrote:

Anonymous wrote:Sequence if returns risk is why I will probably never feel comfortable retiring. I have enough to retire but not enough to retire into a prolonged down market..

My advisor has me keep two years worth of liquid funds outside of the market, so I would not have to tap in if there was a downturn.

They have not historically lasted that long.

There are a couple of issues with that advice. The future is unknown. If you think the future will be like the past, then a downturn can easily last 10 yrs. And your performance is almost guaranteed to take a hit by having money tied up in bonds or cash.

I'm not saying that you shouldn't invest in bonds (you probably should), but their is a downside to pretty much every strategy. Reducing your withdrawal rate to 3% or doing one of the variable strategies is what I'll probably end up doing.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Sequence if returns risk is why I will probably never feel comfortable retiring. I have enough to retire but not enough to retire into a prolonged down market..

My advisor has me keep two years worth of liquid funds outside of the market, so I would not have to tap in if there was a downturn.

They have not historically lasted that long.

There are a couple of issues with that advice. The future is unknown. If you think the future will be like the past, then a downturn can easily last 10 yrs. And your performance is almost guaranteed to take a hit by having money tied up in bonds or cash.

I'm not saying that you shouldn't invest in bonds (you probably should), but their is a downside to pretty much every strategy. Reducing your withdrawal rate to 3% or doing one of the variable strategies is what I'll probably end up doing.

Obviously there is a downside to each strategy. However, if you are approaching retirement, it is best to have a portion of your investments in cash/bonds/easily accessible and not likely to take a hit investments. yes, you will miss out on gains if the market is positive. Conversely, if the market goes down 10%+, those investments will remain steady/small gains.
Given that MM/CDs/treasuries are likely to continue returning 3%+ for the foreseeable future, it would be silly currently not to hedge your bets and put the next 2 years (or more) into that category if that is your income (or will soon be).

just like if your kid is 16 and approaching college, you should not be 100% in stock funds. Unless you can deal with loosing 30-40% of your 529 before they enter college. That's why you move a portion to secure investments a few years before college and hedge your bets with 25-50% in the market still.

[Anonymous]

Anonymous wrote:

Anonymous wrote:Sequence if returns risk is why I will probably never feel comfortable retiring. I have enough to retire but not enough to retire into a prolonged down market..

My advisor has me keep two years worth of liquid funds outside of the market, so I would not have to tap in if there was a downturn.

They have not historically lasted that long.

Tell that to the retiree who retired in 1965.

[Anonymous]

Our plan (at this point) for retirement is to have 60% growth equities, 30% dividend paying stocks, 10% bonds and cash, with the dividends, interest + SSI covering our basic living expenses.

We have the overall number that supposedly we need to retire, but not the percentages yet.

Our hope is to not dip into principal (or assess how it is going and then adjust along the way) and have plenty to pay for LTC as needed, or plenty to pass along to the kids.

[Anonymous]

My aunt advisor told hey she needs the following to retire.
Fully paid off primary home
Fully paid off retirement home
Fully funded grandkids college funds
10 million saved
Zero debt

[Anonymous]

Anonymous wrote:My aunt advisor told hey she needs the following to retire.
Fully paid off primary home
Fully paid off retirement home
Fully funded grandkids college funds
10 million saved
Zero debt

She should fire her advisor, who is an idiot.

[Anonymous]

Anonymous wrote:My aunt advisor told hey she needs the following to retire.
Fully paid off primary home
Fully paid off retirement home
Fully funded grandkids college funds
10 million saved
Zero debt

Forgot to add, yacht and kids college paid for the advisor who is taking 1% annually from your aunt.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:I thought conventional wisdom says you need 10xs your income. So you need 2.5

No, conventional wisdom is 30x your income, or less conservative, 25x your income.

Ridiculous (for one person),

No it's 25X your expenses. We live on half our net income now even while saving for retirement.