three month update (sept 2017)
I am considering a retroactive switch to a target of $2500/month
($2000/month + $6000/year lump) and viewing the starting balance over
$1M as a separate fund to be drawn from without guilt (with the
discipline to understand that once it’s gone, it’s gone). I place no
dependence upon supplemental income (future employment?), social
security ($10k/yr?), inheritance ($500k?), house equity (even with no
heirs), universal health care (probable?), or universal basic income
(possible?). The final balance will be left to charities.
If the year-end value is higher than the starting value, I might recalculate a new 3% SWR value and go forward from there since 3% is well within historically safe territory. If you think this strategy violates Trinity, keep thinking until you see how the 3% starting point should tell you otherwise. I might use instead (and keep using each year) the separate fund technique that I described earlier, until the first bad year hits or until $30k/yr is no longer a viable spending goal due to inflation (lifestyle or purchasing power).
This month's spending was $3148 (up/down from $2640), including $500 from the lump expenses, which is $584 over the targeted amount (23% over budget for the month; now 6% over for the year). We brought in $1031 from my wife's part-time job at the library (which she likes and would do for free) and some old book royalties of mine. Our withdrawal was $2117 this month, which is effectively a 2.06% pro-rated SWR for the month, putting us at 1.81% pro-rated for the year. The portfolio went from $1,054,577 to $1,045,372 (a 0.87% decrease), which dropped down to a new total of (drum-roll) $1,043,255 after paying the bills (1.7% increase since retirement, after expenses).
I am bored to tears with discussions on safe SWR, COL, UBI, ACA subsidy ethics, Trinity, insurance, health care costs, what-if scenarios, financial doomsday preppers, crystal balls, investment strategies, side hustles, lifestyle inflation, market corrections, frugality tips, tax avoidance, and even the acronym FIRE. When you’re new to the topic of early retirement, all of that stuff is very exciting. When you’ve run the race and crossed the line, not so much. This is a public forum, and I’ll likely read what you have to say, but please don’t expect much in the way of a response if it’s a question that I or someone else has answered a million times, especially if you’re just offering an unsubstantiated claim about my personal situation that demonstrates willful stupidity. I am however willing to clarify anything and discuss topics I find to be of more interest. I genuinely appreciate all the congratulations and well-wishers.
Financial thoughts for the month: My former employer’s 401(k) finally allowed me a final distribution on the 25th, long after I wanted out of small-cap (no other low ER fund was offered). If I could have withdrawn and converted to VTSAX upon retirement, I would have saved about $10k (small-caps took a hit a few weeks back). Of course since I’ve cashed out and am waiting for a $500k check to forward to Vanguard (no, they don’t send directly to institution; and yes, it’s made out in their name), small-caps have had a tremendous week (another $10k loss). Such is life. Spending was considerably up this month. $200 for a car battery; $200 on an IKEA trip; $200 on a car hitch with bike rack explain the overage. It doesn’t take much. Just those three items wiped out half the buffer that our supplemental income provides. Without that income, this month’s adjusted SWR would have been 3.7%.
Experiences for the month: I’ve read more in three months than the past three years. Darwin’s Origin of Species, The Bible (cover to cover), a college astronomy textbook, in addition to 3-4 others, just this month alone. I cook weekly (first time with thai, chili, and sushi). I broke off the Diablo 3 semi-addiction, tried Path of Exile and Diablo 1 HD Mod a little. I’m up to 40 miles per week with my running (going for 1:25 HM Oct 14). Lifting weights three times per week and I can tell a difference. I live in the path of totality for the eclipse and saw the most amazing thing of my life. A little swimming, a little television (rewatched the 1977 Roots mini-series and some political stuff on youtube), a little more music, and a lot more housework. I’m so glad to not have the work stress. I was warned that happiness won’t automatically come from quitting work, which is true, but not having the stress sure helps me feel better. Now to just work on some personal stuff.
Plans for next month: lots more running, my first round of golf, maybe Game of Thrones (never watched), still looking for somewhere to volunteer (harder than you would think), keeping an eye out for used kayaks, more movies perhaps (I’m at around 600 on the TSPDT 1000 list), and whatever the fuck I want.
If the year-end value is higher than the starting value, I might recalculate a new 3% SWR value and go forward from there since 3% is well within historically safe territory. If you think this strategy violates Trinity, keep thinking until you see how the 3% starting point should tell you otherwise. I might use instead (and keep using each year) the separate fund technique that I described earlier, until the first bad year hits or until $30k/yr is no longer a viable spending goal due to inflation (lifestyle or purchasing power).
This month's spending was $3148 (up/down from $2640), including $500 from the lump expenses, which is $584 over the targeted amount (23% over budget for the month; now 6% over for the year). We brought in $1031 from my wife's part-time job at the library (which she likes and would do for free) and some old book royalties of mine. Our withdrawal was $2117 this month, which is effectively a 2.06% pro-rated SWR for the month, putting us at 1.81% pro-rated for the year. The portfolio went from $1,054,577 to $1,045,372 (a 0.87% decrease), which dropped down to a new total of (drum-roll) $1,043,255 after paying the bills (1.7% increase since retirement, after expenses).
I am bored to tears with discussions on safe SWR, COL, UBI, ACA subsidy ethics, Trinity, insurance, health care costs, what-if scenarios, financial doomsday preppers, crystal balls, investment strategies, side hustles, lifestyle inflation, market corrections, frugality tips, tax avoidance, and even the acronym FIRE. When you’re new to the topic of early retirement, all of that stuff is very exciting. When you’ve run the race and crossed the line, not so much. This is a public forum, and I’ll likely read what you have to say, but please don’t expect much in the way of a response if it’s a question that I or someone else has answered a million times, especially if you’re just offering an unsubstantiated claim about my personal situation that demonstrates willful stupidity. I am however willing to clarify anything and discuss topics I find to be of more interest. I genuinely appreciate all the congratulations and well-wishers.
Financial thoughts for the month: My former employer’s 401(k) finally allowed me a final distribution on the 25th, long after I wanted out of small-cap (no other low ER fund was offered). If I could have withdrawn and converted to VTSAX upon retirement, I would have saved about $10k (small-caps took a hit a few weeks back). Of course since I’ve cashed out and am waiting for a $500k check to forward to Vanguard (no, they don’t send directly to institution; and yes, it’s made out in their name), small-caps have had a tremendous week (another $10k loss). Such is life. Spending was considerably up this month. $200 for a car battery; $200 on an IKEA trip; $200 on a car hitch with bike rack explain the overage. It doesn’t take much. Just those three items wiped out half the buffer that our supplemental income provides. Without that income, this month’s adjusted SWR would have been 3.7%.
Experiences for the month: I’ve read more in three months than the past three years. Darwin’s Origin of Species, The Bible (cover to cover), a college astronomy textbook, in addition to 3-4 others, just this month alone. I cook weekly (first time with thai, chili, and sushi). I broke off the Diablo 3 semi-addiction, tried Path of Exile and Diablo 1 HD Mod a little. I’m up to 40 miles per week with my running (going for 1:25 HM Oct 14). Lifting weights three times per week and I can tell a difference. I live in the path of totality for the eclipse and saw the most amazing thing of my life. A little swimming, a little television (rewatched the 1977 Roots mini-series and some political stuff on youtube), a little more music, and a lot more housework. I’m so glad to not have the work stress. I was warned that happiness won’t automatically come from quitting work, which is true, but not having the stress sure helps me feel better. Now to just work on some personal stuff.
Plans for next month: lots more running, my first round of golf, maybe Game of Thrones (never watched), still looking for somewhere to volunteer (harder than you would think), keeping an eye out for used kayaks, more movies perhaps (I’m at around 600 on the TSPDT 1000 list), and whatever the fuck I want.