What's the number?

[frorider]

Fuck it, we should all retire now: https://www.reuters.com/article/us-c...-idUSKBN1I3293

Because people worry about outlasting their savings, most adjust by living humbly – often overly so. Consequently, they make even modest savings last for years longer than expected by researchers.

While some people do run out of money, a person with less than $500,000 in savings, on average, spends just about a quarter of it during the first 20 years of retirement, according to a study by Sudipto Banerjee of the Employee Benefit Research Institute.

One-third actually end up with a nest egg larger than they had when they left their jobs, the study says. Even people who had only $32,000 shortly

....

In the EBRI study, those with the most savings - a median of $857,450 shortly after retiring - still had $756,300 two decades later. The decrease amounts to just 11.8 percent of the original sum.

[iceman]

I need to tell my wife about this "live humbly" idea.

[Timberridge]

I need to tell my wife about this "live humbly" idea.

wholesome organic ingredients are not cheap

[JimmyCarter]

I need to tell my wife about this "live humbly" idea.

I thought she was the retirement plan?

[MontuckyFried]

I need to tell my wife about this "live humbly" idea.

Lol. One thing's for sure, due to circumstances we recently had to sell our house, sell everything we didn't need/want (even most our furniture), and have massively downsized our lives. Won't get into all the details right now of how we try and spend less, but one thing I've realized through this all is actually how CHEAPLY one can exist if they "live humbly." We can still do better in certain areas, but I feel we live pretty simple in a lot of ways. It's also made me realize that we really don't need as much as people say we will to retire. Not living our current ways at least.

wholesome organic ingredients are not cheap

They can be if you there's a Bountiful Baskets coop in your area! We load up on buttloads of organic fruits/veggies once in a while thanks to that program. Check it out if you've never participated: http://www.bountifulbaskets.org/

[SkiCougar]

Fuck it, we should all retire now: https://www.reuters.com/article/us-c...-idUSKBN1I3293

from the article: "“People don’t want to touch their nest eggs,” said financial planner Anderson. “They feel fine spending interest or income from their investments but are reluctant to touch anything else.”

my opinion is that once many people actually retire, the fact that that regular income from a job isn't coming anymore puts some strict spending into them.

[iceman]

I thought she was the retirement plan?

"retirement gamble" is more like it. hey it might work out, we'll see.

[Skidog]

"retirement gamble" is more like it. hey it might work out, we'll see.

Shit who knows maybe they are the next "powerbar"

Sent from my XT1650 using TGR Forums mobile app

[GeezerSteve]

We call it "living low to the ground." The extreme end of the spectrum is called possum living. In the course of my career I've seen lots of people with bigger incomes than mine burn to the ground because they lived way beyond their means. Most of their purchases were wholly unnecessary. I don't get it. I couldn't sleep at night if we lived beyond our means.

That article is quite incomplete, e.g., makes no mention of SS. "Don't touch the principal" is a rich man's credo. Tapping the principal as part of a living low to the ground strategy is fine if that's what it takes to delay taking SS until age 70. (This assumes you've paid a decent amount into SS.)

[Ted Striker]

Shit who knows maybe they are the next "powerbar"

i.e. bought out by a massive corporation for hundreds of million dollars.

Sounds like a pretty good retirement to me.

[AdironRider]

We call it "living low to the ground." The extreme end of the spectrum is called possum living. In the course of my career I've seen lots of people with bigger incomes than mine burn to the ground because they lived way beyond their means. Most of their purchases were wholly unnecessary. I don't get it. I couldn't sleep at night if we lived beyond our means.

That article is quite incomplete, e.g., makes no mention of SS. "Don't touch the principal" is a rich man's credo. Tapping the principal as part of a living low to the ground strategy is fine if that's what it takes to delay taking SS until age 70. (This assumes you've paid a decent amount into SS.)

You have to have a relative shot at living to 90 to make waiting till 70 pay off, regardless of how much you qualify for as a benefit. Think the breakeven is 86 or 87, so if you have good genes go for it, otherwise take that shit early.

Still shooting for retirement at 59.5 with a paid off house, a rental, and a cool million. Feel strong about my odds.

Edit: The synopsis of that book claims you don't need doctors, lawyers, or insurance. I can see the lawyer thing but the other two? What are your thoughts Steve?

[XXX-er]

We call it "living low to the ground." The extreme end of the spectrum is called possum living. In the course of my career I've seen lots of people with bigger incomes than mine burn to the ground because they lived way beyond their means. Most of their purchases were wholly unnecessary. I don't get it. I couldn't sleep at night if we lived beyond our means.

That article is quite incomplete, e.g., makes no mention of SS. "Don't touch the principal" is a rich man's credo. Tapping the principal as part of a living low to the ground strategy is fine if that's what it takes to delay taking SS until age 70. (This assumes you've paid a decent amount into SS.)

A lot of smart people out thar

so smart they out smart themselves

I would rather be dumb an continue to not work

cuz I am unhireable at this point

[iceman]

i.e. bought out by a massive corporation for hundreds of million dollars.

Sounds like a pretty good retirement to me.

Well that's one end of the range of possibilities.

[skaredshtles]

<snip>
Edit: The synopsis of that book claims you don't need doctors, lawyers, or insurance. I can see the lawyer thing but the other two? What are your thoughts Steve?

Seems like a bit of a dice-roll, eh? I guess once you're on single-payer old folks medical you can not worry about doctors?

[Benny Profane]

Seems like a bit of a dice-roll, eh? I guess once you're on single-payer old folks medical you can not worry about doctors?

OH, you still have to worry plenty, and cover that shit with Medicare B and a good Medigap plan. Cancer is really really expensive. So, no insurance is stupid. That's about 5 grand a year. It's never going to be free, like France, and, if these pricks in Congress have their way, look for 10 grand a year soon after 65 to cover your ass(ets).

[Benny Profane]

Just read an article this morning about how AirB&B is bringing out the pitchforks in various cities and towns in Europe, especially Spain, which is my next month long trip. Fuck. Going to have to act fast. Granada right now has 900 a month rentals. Cheap trip.

[wooley12]

When the money runs out.....die. You are no longer needed in a capitalist society that respects only money. You become a detriment to shareholder value and enemy of productivity. Dying seems quite popular. Everybody does it. Death Panels on the sly.

[GeezerSteve]

You have to have a relative shot at living to 90 to make waiting till 70 pay off, regardless of how much you qualify for as a benefit. Think the breakeven is 86 or 87. . . .

Well, that might be the payoff threshold age sometime in the future, but it's a few years too high for someone my age. My payoff threshold age is 83-1/2, and it applies to me and my wife if she outlives me. It works like this (assuming flat income up to SS election date):

-- SS looks at the average American's life expectancy at age 62. Currently, that is 21-1/2 years, i.e., today's average 62 y.o. has a working "average death date" of 83-1/2.

-- SS actuarial tables pay out the same aggregate amount, regardless of when the recipient takes it, IF the recipient dies at his or her "average death date." For example, if our hypothetical 62 y.o. (today) takes SS at age 62, at "full" (66 years, 4 months for me), at 70 or at anytime between 62 and 70 AND he dies at exactly 83-1/2 years, he or she will have collected the exact amount of SS.

-- Thus, for those age 62 today, waiting to take SS until age 70 is best hedge against the recipient or the recipient's spouse (see below) living older than 83-1/2.

-- The payoff age threshold creeps up a bit if the recipient's income level trends downward after age 62. For me (61-1/2, semi-retired), the payoff age will creep up to around 84-1/2 based on my current trajectory per working around 1/4 time.

-- A BIG factor is whether the recipient has a spouse who is younger and/or paid less into SS. When the recipient dies, the surviving spouse (if at "full" SS age or older) can elect to take the dead spouse's monthly payment. If the surviving spouse is younger than "full" SS age, the monthly payment is whittled down, but not by much. Because the odds that 1 of 2 spouses will outlive the payoff threshold age is necessarily greater, a married couple with sufficient resources should wait until the higher lifetime earner is 70 before he or she elects to take SS.

In my circumstances, it's a no-brainer. My wife is one month shy of 8 years younger than I am. She will likely outlive me. (Her mother, who lived a less than healthy life, recently died at age 93.) We can afford to live off our incomes, supplemented by savings and retirement if necessary, until I reach 70, at which time I will take SS. My wife will take SS early, at age 62. Our combined SS payments should be plenty to live on (if Congress doesn't fuck it up), with savings as a cushion. When I die, my wife takes my higher SS payment.

Edit: The synopsis of that book claims you don't need doctors, lawyers, or insurance.

That's a manifestly faulty synopsis of the book. I do not recall any mention of doctors, lawyers or insurance when I read the book a few years ago. If those things are mentioned, it was merely in passing. The book is mostly about self-sufficiency (e.g., growing food, fixing your stuff), not getting caught up in impressing others with stuff, acknowledging that time and experiences are more valuable than stuff, and finding value in things that are free or cheap (e.g., birdwatching, XC skiing). The author (pseudonym Dolly Freed) wrote the book as a young woman when she was living the possum life with her father. She later became a NASA scientist, continued living low to the ground and has saved more money than she could ever spend.

[4matic]

Once you have your income for life figured out you should take regular distributions. That’s what my Insurance expert bro says. It makes sense. You can slow down after year one or any other year.

I plan for zero inflation and 3% yield.

[AdironRider]

has saved more money than she could ever spend.

Well then what is the point? I know you can't plan perfectly, but it seems pretty stupid IMO to just hoard cash and give up life experiences because you might live to 100. You only live once ya know.

And I agree, having a significantly younger spouse, who has earned consistently less than you, it makes sense to wait for SS. That isn't the majority of people though.

[XXX-er]

[QUOTE=Benny Profane;5343589]Just read an article this morning about how AirB&B is bringing out the pitchforks in various cities and towns in Europe, especially Spain, which is my next month long trip. Fuck. Going to have to act fast. Granada right now has 900 a month rentals. Cheap trip.[/QUOTE

In a great airbnb in barcelona right now that is cheap as fuck

[Benny Profane]

Enjoy it while you can. There were protests in Barcelona last year and recently. Seville is passing laws. I don't blame them. I probably contributed a little bit to a middle class Italian not finding an affordable apartment with my month in Verona last year. Sure can be cheap, though, especially having a full kitchen.

[GeezerSteve]

Well then what is the point?

The point of what? Her book is not about retiring early. Indeed, I don't recall that she even mentions it. Why would she? She was 18 y.o. when she wrote it. The book is about living a good rich life on very little money.

Maybe you're confusing Possum Living with another book, Your Money or Your Life, which is about retiring early via simple living.

And I agree, having a significantly younger spouse, who has earned consistently less than you. . . .

Well, actually, my wife has paid SS premiums at or near SS maximum most of the past 20 years, and will likely pay max the next 8 years (when we'll both take SS), thus her SS benefit schedule will look very similar to mine. In our case it's about her being younger, not about a history of lower earnings.

ETA: Another factor: The calculation of taking SS at an early age has dramatically changed in the past 20-25 year. In 1995, if you had a chunk of money in savings and retirement at age 62, you could invest in super safe debt instruments with 5-6% or better return. Back then, taking SS at 62 sometimes penciled out because the return on the debt instruments more than made up for the value of delaying SS election. It's a different world now.

[Sirshredalot]

Well then what is the point? I know you can't plan perfectly, but it seems pretty stupid IMO to just hoard cash and give up life experiences because you might live to 100. You only live once ya know.

And I agree, having a significantly younger spouse, who has earned consistently less than you, it makes sense to wait for SS. That isn't the majority of people though.

It is for very many men. Men tend to earn more, tend to be a little older than their spouse, and also die earlier than women. Most married women end up widowed.

[Benny Profane]

I plan for zero inflation and 3% yield.

Zero is a bit severe, but, yeah, not much inflation for a decade or two, and inflation can destroy savings.