# Do we have enough to retire by March 2014?



## Mookie

Hi all, my wife and I have been working hard and saving for our future all of our adult lives, and I think we’re now almost at the point where we can sit back and enjoy the fruits of our labour, by retiring in March of 2014.

For the last year, I’ve been crunching the numbers, and refining my massive spreadsheet, and according to my own assumptions and projections, I think we’re in good shape, but it’s always good to get some other expert eyes on the numbers, so here they are. Let me know what you think:

Retirement Savings (projected as of March 2014)

Mr. Mookie’s RRSP: $66,000
Mrs. Mookie’s RRSP: $53,000
Mrs. Mookie’s Spousal RRSP: $131,000 (Mrs. Mookie will withdraw as earnings)
Mr. Mookie’s TFSA: $33,000
Mrs. Mookie’s TFSA: $32,000
Mr. Mookie’s Non Registered: $216,000
Mrs. Mookie’s Non Registered: $310,000
Total Retirement Savings: $841,000
Retirement savings is generally invested in dividend paying ETFs, and is earning roughly 4.0% / year in dividends

Liabilities (projected as of March 2014)

Mr. Mookie’s Investment loan: $71,000 @ 2.15% (to be paid down by 2019)
Mrs. Mookie’s Investment Loan: $142,000 @ 3.0% (to be paid down by 2019)
Total Liabilities: $213,000

Future Expected Annual Income Amounts:

Mr. and Mrs. Mookie’s basement suite rental income: $8400 from now until 2028
Mr. Mookie’s DB pension: $18,400 (in today’s dollars) starting in 2023 / age 55, indexed to inflation
Mr. Mookie’s CPP: $9800 (in today’s dollars) starting in 2038 / age 70, indexed to inflation
Mr. Mookie’s OAS: $6550 (in today’s dollars) starting in 2035 / age 67, indexed to inflation
Mrs. Mookie’s CPP: $3000 (in today’s dollars) starting in 2039 / age 70, indexed to inflation
Mrs. Mookie’s OAS: $6550 (in today’s dollars) starting in 2036 / age 67, indexed to inflation

Other Assets:

House: $700,000
RESP: $80,000

General Info and Assumptions:

Goal: Retire in March of 2014
Mr. Mookie’s age at retirement: 45
Mrs. Mookie’s age at retirement: 44
Assumed inflation Rate: 2.5%
Assumed average investment return: 4.0%
Total average expenses per year: $50,000 (plus income tax, which varies by year)

The Plan:

Retire in March 2014
Gradually withdraw RRSPs from 2014 until the various pensions start around 2035-2039, to take advantage of “low income” years for tax purposes
Continue to shift money from non-registered accounts to TFSAs as much as possible to tax shelter future investment earnings
Downsize from existing house in 2028, when value is expected to be $1,000,000. Use $700,000 for downsized home, and move $300,000 to fund retirement.

I am also considering the possibility of working a couple extra years to add an extra cushion to our retirement savings, but life's too short, so I don't want to spend any more time at work than is really necessary.


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## none

I will only comment on your projection of the value of your house.

A likely more reasonable assumption is that your house will be worth 500K in 2013 dollars in 2028. Current house values are all screwed up and they will correct.


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## Jon_Snow

Good to see that I am not the only nut job trying to retire in my early 40's. :biggrin:

Strangely enough Mookie, I am also thinking about pulling the pin on my career in March 2014 - I will be 42. In some ways your numbers are similar to mine, but I have allowed for much more "padding" - you may very well be good to go, but in retiring in one's 40's... well, like you said if our plans go awry we are still young enough to go back to work. :hopelessness:


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## My Own Advisor

Impressive Mookie. Congrats.

I like the plan, especially the draw-down on RRSPs (early) in lower-income years; that's about $250K of your investments. Spending most or moving some of that to unregistered and as TFSA if possible would be good.

Any idea what your annual expenses might be?

@Jon_Snow, curious, what will your annual expenses be in early retirement?


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## Jon_Snow

My Own Advisor said:


> @Jon_Snow, curious, what will your annual expenses be in early retirement?


My wife and can live quite nicely on 30k per year, though I think we could probably spend 50k and be fine.


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## RBull

LOL. You never miss an opportunity to diss real estate. I can understand that from someone living in BC.

In truth I agree with you that future value shouldn't really have any growth baked in. 



none said:


> I will only comment on your projection of the value of your house.
> 
> A likely more reasonable assumption is that your house will be worth 500K in 2013 dollars in 2028. Current house values are all screwed up and they will correct.


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## lonewolf

your net worth is 841,000 + 780,000 - 213,000 = 1,408,000 (of course tax has to be paid on some of it)

Amazing job

You investments could drop in value very quickly when leverage is involved. (investment loan) But then you could always go back to work or move to a country where your dollars are streached.


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## andrewf

Do you plan to have a very modest lifestyle? Your net worth won't support much more over 50 years of retirement.


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## RBull

Mookie, You've done a good job accumulating assets at your age. In theory your plan looks good. 

I don't have the benefit of your spreadsheet however but it seems aggressive to retire that early with the savings you have, the lifestyle costs you indicate, and with the large debt repayment. You've got a lot to draw down to repay the loan in 5 years and maintain lifestyle, and a lot to fund the difference between your pension and expenses until CPP & OAS kick in. Hopefully nothing will change negatively on CPP/OAS in the next 25 years. I'm using ours as a bonus in my plan. I'm also not counting on any real estate investment value at the point of down sizing our home. 

As mentioned above your real estate may not net you the amount you're projecting and the loss of the rental income may not be made up by any difference from down sizing.


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## Spudd

My only question is whether your CPP amounts are taking into account the number of years you're not working.


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## My Own Advisor

@Jon_Snow,

Thanks for responding. I was thinking we'd need about $55K (after-tax) to retire but I think we could live on much less. We're a good 15 years away from making that happen unfortunately.

Key retirement expenses forecasted:
-property taxes
-home maintenance
-utilities
-insurance
-food & household supplies
-healthcare, dental, other

Hopefully the pension can cover these essentials. I want zero debt (mortgage or car payment) in retirement. The investments can hopefully cover other things.


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## RBull

My Own Advisor said:


> @Jon_Snow,
> 
> Thanks for responding. I was thinking we'd need about $55K (after-tax) to retire but I think we could live on much less. We're a good 15 years away from making that happen unfortunately.
> 
> Key retirement expenses forecasted:
> -property taxes
> -home maintenance
> -utilities
> -insurance
> -food & household supplies
> -healthcare, dental, other
> 
> Hopefully the pension can cover these essentials. I want zero debt (mortgage or car payment) in retirement. The investments can hopefully cover other things.


I like your focus on all things retirement. Zero debt in retirement is the only way to fly. 

Sorry to the OP for the thread rob.


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## skiwest

Mookie said:


> [*]Downsize from existing house in 2028, when value is expected to be $1,000,000. Use $700,000 for downsized home, and move $300,000 to fund retirement.


What your assuming is that the house value in real terms will go up by 30% over 15 years. That seems a bit high considering we have just gone through a growth period in RE. But then again downsizing will yield $$ in that that downsized house will be cheaper. Why not assume that house will be same value in todays $ and just count on the difference in what you would downsize today. Today in a $700k house would move to a $450K house ( or $400K) in todays $. Look at MLS and see what you could live with and use that $.

My plan is dec 2013 or Jan 2014, march is just silly as you miss ski season  to each his own

I use 5% rate of return with 2% inflation so your very conservative there compared to me
I don't include OAS

expenses are very similair , accounted for 60K before tax while bottom up estimate is56k so margin there


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## birdman

The only comment that I can make is that when we retired at age 55 (now 67) is that I estimated my expenses to be about the same as yours, about $50,000. or so per annum. This turned out to be about right except for extraordinary expenses, many of which were voluntary, which I didn't include. For example, over the past 5 or so years I had the following one time expenses:
New furnace and air source heat pump: $10,000.
Trip to Africa: 10,000.
Gift to one child when he married 20,000.
Gift to other child when he married 20,000.
New roof, eves, deck rebuild 10,000.
New deck 8,000.
New car: 30,000.
Kitchen update with SS appliances & granite 10,000.
Extended trip and cruise 12,000.

These additional expenses probably average $20,000. PA and every year another one seems to come up. 
Also, over the past ten years we have done some other things not initially planned for such as spending probably $5,000. PA in travelling and other costs associated in playing a sport in which I compete provincially and nationally in. Gym and tennis membership for my wife also doubled.
Of course the above expenditures would have not been made or would have been reduced if we could not afford them, however, the point I am trying to make is that there are always unforseen expenses depending on your choices and lifestyle and it is the unkown or unplanned things that are difficult to know. I am glad I made an allowance for these and you may wish to consider the same.


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## Eder

I retired at 53 with similar assets. After 3 1/2 years of freedom I would recommend that pulling the pin from the daily grind ASAP is paramount even with much less. What good does working to 65 do anyone, too soon we are all dust again so enjoy the ride.


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## steve41

If I run your numbers, I would need to know both gross salaries if even for a year.


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## Rainey

Mookie, my two cents:

Barring any serious physical or mental illness, there is no way, no how, anyone who was able to achieve what you have achieved at your age will end up "hanging out" for the next 50 years. It may not be for a while, it may not be anything you imagined yourself doing, but you'll be working again before its all over -- hopefully in a role, and in a way, you love.

My guess, your calculations are way off -- to the good. Within 5 or ten years after you begin to tire of travel, golf, woodworking or whatever else might float your boat, you'll be happily earning more than enought to cover your expenses as you've described. 

So pull the pin and don't look back.


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## none

RBull said:


> LOL. You never miss an opportunity to diss real estate. I can understand that from someone living in BC.
> 
> In truth I agree with you that future value shouldn't really have any growth baked in.


Roar!


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## skiwest

frase , I see your point but have been trying to just get all of the things we can think of done before pulling the pin. Plus our $60K allowance is quite a bit above the bottom up estimate low, not that we want to live there all the time but the 56k estimate does have a a fair bit of fat.

The other thing we did is have my wife retire before I did. So sold other residence so didn't have to estimate take away from that. Also had counted on a bit of consulting income from wife. AS that didn't turn out , it still may , took that off the table.

Haven't adjusted for vehicles as both are pretty new ( also part of plan) and when the 1 ton needs replacing we just won't be doing those things anymore or certainly wouldn't buy new.

Have even accounted for kid in that I was given money for house so she has already been given $50k for house grad school ( vet) so feel that that is enough until cabin and land come her way.


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## Charlie

my back'o the envelope calc....

you have $628K invested assets (excluding RESP and net of investment debt). At a 4% that brings you $25K. Plus your rental suite. You want $50K after tax. You have kids. 

I don't think you're there yet. Might be a great time for a few years sabbatical...to find a better treadmill...but you're cutting it very close to call it quits now. I think Rainey's dead on. You should look for more enjoyable employment or business. Or blitz it a few more years until you can be sustained with your investment income.


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## RBull

none said:


> Roar!



Ha. Cheers.:biggrin:


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## avrex

It's a rally race. Does mookie have enough fuel to reach each targeted destination?

Let's review his situation (in today's dollars) *at different age stages.*
- He will require $50,000 in average expenses per year.
- *At age 45*, he retires with $628,000 in investment assets. 
He needs a portion of that money to carry him forward 10 years.
- *At age 55*, he gets $18,400 per year from his DB pension.
Therefore he still needs $31,600 per year (50,000-18,400) from his investment assets, to carry him forward for another 12 years.
- *At age 67* (or 70 or whatever), he gets an additional $25,900 per year from CPP/OAS.
Therefore he only needs an additional $5,700 per year (31,600-25,900) from his investment assets for the remainder of his life.

In summary, he will need to burn through most of his investment assets, until age 67, to sustain himself. 
Once he starts receiving CPP/OAS, his expenses are almost fully covered.

The question is.... Is his $628,000, starting at age 45 enough to carry him through to these different stages?


*@Mookie*
*1. * You need to reply to 'steve41'. That's a very nice offer from him, to crunch your numbers.
Using his resources, steve41 can break down the above scenario for you.
*2. * Are you firm with your plan to stay in your current home, until age 60? 
Would you consider downsizing your home earlier, in order to add to your investment assets?

Mookie, I like your detailed plans. You've obviously given this a lot of thought. You've done well to get to this point in your life.


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## My Own Advisor

Nice way to create some suspense avrex!


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## CanadianCapitalist

Charlie said:


> you have $628K invested assets (excluding RESP and net of investment debt). At a 4% that brings you $25K. Plus your rental suite. You want $50K after tax. You have kids.


The 4 percent rule is not applicable here. The original 4 percent rule was based on the assumption that someone retires at age 65 and wants the portfolio to last 30 years. The withdrawal rate for someone retiring in their mid-forties is a lot lower, probably in the 2 percent range because the portfolio has to last pretty much forever. That would mean $50K pre-tax can probably be safely harvested from a $2.5 million portfolio. Just my 2 cents.


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## MoneyGal

The 4% rule was also developed in a different real returns environment than the current one. We should probably abandon the 4% rule for planning purposes: http://papers.ssrn.com/sol3/papers.cfm?abstract_id=2201323

Abstract of that paper [bold added by me]: 

The safety of a 4% initial withdrawal strategy depends on asset return assumptions. Using historical averages to guide simulations for failure rates for retirees spending an inflation-adjusted 4% of retirement date assets over 30 years results in an estimated failure rate of about 6%. *This modest projected failure rate rises sharply if real returns decline*. As of January 2013, intermediate-term real interest rates are about 4% less than their historical average. Calibrating bond returns to the January 2013 real yields offered on 5-year TIPS, while maintaining the historical equity premium, causes the projected failure rate for retirement account withdrawals to jump to 57%. The 4% rule cannot be treated as a safe initial withdrawal rate in today’s low interest rate environment. Some planners may wish to assume that today’s low interest rates are an aberration and that higher real interest rates will return in the medium-term horizon. Although there is little evidence to support this assumption, we estimate how a reversion to historical real yields will impact failure rates. Because of sequence of returns risk, portfolio withdrawals can cause the events in early retirement to have a disproportionate effect on the sustainability of an income strategy. We simulate failure rates if today's bond rates return to their historical average after either 5 or 10 years and find that failure rates are much higher (18% and 32%, respectively for a 50% stock allocation) than many retirees may be willing to accept. *The success of the 4% rule in the U.S. may be an historical anomaly*, and clients may wish to consider their retirement income strategies more broadly than relying solely on systematic withdrawals from a volatile portfolio.


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## Four Pillars

MoneyGal said:


> We should probably abandon the 4% rule for planning purposes


[in a sing-song voice] "I'm not listening....".

Please don't tell me I have to save even more than I already have to!!


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## peterk

Four Pillars said:


> [in a sing-song voice] "I'm not listening....".


Haha - Agreed! My dreams of early retirement will not be quashed by scaredy cats!


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## skiwest

But today if you wanted to put that mil into Canadian bank share that all yield 4% or slighly higher and just live on the div income and be reasonably sure that the dividends will keep up with inflation as far as income is concerned.


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## Mookie

First off, thank you all for your comments so far. I was hoping to get a wide variety of opinions to help me to see my plan from different perspectives, and so far that’s definitely what I’ve seen in the responses. I would have replied sooner, but unfortunately I’m not retired yet! :chuncky:

Now let me try to respond to the comments so far - sorry for the long post… 



none said:


> I will only comment on your projection of the value of your house.
> A likely more reasonable assumption is that your house will be worth 500K in 2013 dollars in 2028. Current house values are all screwed up and they will correct.


Hi @none, my projection of future house price was obtained by simply taking my assumed inflation rate of 2.5%, and applying it to the current value of my house. So in effect, I’m saying that I expect my house to be worth the same in future dollars as it is today in today’s dollars.

Assuming your prediction is correct for a moment, I would sell my house for $500K (in today’s dollars), and would be able to buy my downsized place for $350K (because its value also dropped), leaving me with $150K (in today’s dollars) to add to my retirement fund. Not the greatest scenario, but I would survive.

Looking at real estate statistics for my area going back as far as 1979, the biggest housing bubble was of course 1981. According to those stats, if I bought a $700,000 home in 1981 right before the bubble burst, and then waited 15 years to sell (as I plan to do now), my house would have been worth roughly $1.3M in 1996.



My Own Advisor said:


> I like the plan, especially the draw-down on RRSPs (early) in lower-income years; that's about $250K of your investments. Spending most or moving some of that to unregistered and as TFSA if possible would be good.
> Any idea what your annual expenses might be?


Hi @My Own Advisor, yes, the early draw-down of RRSPs will save us a ton of money in taxes. Regarding expenses, according to my detailed bottom-up estimate, my annual expenses (excluding taxes) are expected to be roughly $36K-$40K, however for this discussion, I included an estimate of $50K per year just to be conservative and allow for more fun. My wife and I aren’t big spenders now, so I don’t think we would suddenly become big spenders in retirement. BTW, I enjoy reading your blog, and others on investing and early retirement. They’ve really helped me to fine tune my plan.



lonewolf said:


> You investments could drop in value very quickly when leverage is involved. (investment loan) But then you could always go back to work or move to a country where your dollars are streached.


Thanks @lonewolf, I agree they could drop, and in fact they did drop big time in 2008, but we held on, didn’t panic, bought more on the way down (too soon in hindsight) and “enjoyed” the ride. OK, we didn’t enjoy it, but here we are on the other side :chuncky:. If another 2008 comes along, I expect we can survive that too, and we do plan to deleverage completely between now and 2019. We would accelerate that if our investments don’t continue to outpace the cost of borrowing like they are currently.



andrewf said:


> Do you plan to have a very modest lifestyle? Your net worth won't support much more over 50 years of retirement.


Hi @andrewf, yes, the plan would be for a somewhat modest lifestyle, spending $50K / year. BTW, we currently live quite comfortably on $34K / year, excluding taxes.



RBull said:


> …it seems aggressive to retire that early with the savings you have, the lifestyle costs you indicate, and with the large debt repayment. You've got a lot to draw down to repay the loan in 5 years and maintain lifestyle, and a lot to fund the difference between your pension and expenses until CPP & OAS kick in.


Thanks @RBull, I agree it’s not a sure thing, which is why I am considering working a couple more years to pad my savings. It all comes down to risk analysis in the end – the risk of running out of money by retiring too early, vs. the risk of not being healthy enough to enjoy retirement, by retiring too late. I’ve seen too many people around me come down with medical issues in their 40’s, 50’s or 60’s, and I would hate to be one of those poor schmucks that die before they even start their retirement.



Spudd said:


> My only question is whether your CPP amounts are taking into account the number of years you're not working.


Hi @Spudd, the CPP estimates came from Service Canada, and are based on our past work history, and the assumption that we stop working this year.



skiwest said:


> What your assuming is that the house value in real terms will go up by 30% over 15 years. That seems a bit high considering we have just gone through a growth period in RE. But then again downsizing will yield $$ in that that downsized house will be cheaper. Why not assume that house will be same value in todays $ and just count on the difference in what you would downsize today. Today in a $700k house would move to a $450K house ( or $400K) in todays $. Look at MLS and see what you could live with and use that $.


Thanks @skiwest, I think my reply above to @none addresses your part of your comment as well. There are lots of nice new condos in the $400-$450K range in my area, and I think Mrs. Mookie and I would be quite happy with something like that after the kids leave the nest. I don’t enjoy yard work anyway.



frase said:


> The only comment that I can make is that when we retired at age 55 (now 67) is that I estimated my expenses to be about the same as yours, about $50,000. or so per annum. This turned out to be about right except for extraordinary expenses, many of which were voluntary, which I didn't include. Of course the above expenditures would have not been made or would have been reduced if we could not afford them, however, the point I am trying to make is that there are always unforseen expenses depending on your choices and lifestyle and it is the unkown or unplanned things that are difficult to know. I am glad I made an allowance for these and you may wish to consider the same.


Thanks @frase, good point, and my own Excel projection is based on retirement expenses (excluding taxes) of roughly $40K / year, but I stated $50K / year in my original post as a buffer for these extras. I agree that these extras are wants, not needs, so we would only spend the extra money if we had it, as you have done.



Eder said:


> I retired at 53 with similar assets. After 3 1/2 years of freedom I would recommend that pulling the pin from the daily grind ASAP is paramount even with much less. What good does working to 65 do anyone, too soon we are all dust again so enjoy the ride.


Thanks @Eder, I couldn’t agree more!!!



steve41 said:


> If I run your numbers, I would need to know both gross salaries if even for a year.


Thanks very much @steve41! I just received your analysis by private message (that was fast!). I'll comment on it later, after I've had a chance to review it in detail.



Rainey said:


> Barring any serious physical or mental illness, there is no way, no how, anyone who was able to achieve what you have achieved at your age will end up "hanging out" for the next 50 years. It may not be for a while, it may not be anything you imagined yourself doing, but you'll be working again before its all over -- hopefully in a role, and in a way, you love.
> 
> My guess, your calculations are way off -- to the good. Within 5 or ten years after you begin to tire of travel, golf, woodworking or whatever else might float your boat, you'll be happily earning more than enought to cover your expenses as you've described.
> 
> So pull the pin and don't look back.


Thanks for the encouraging words @Rainey! I certainly hope to put as much effort into enjoying my retirement as I have done planning how to get there!



Charlie said:


> I don't think you're there yet. …You should look for more enjoyable employment or business. Or blitz it a few more years until you can be sustained with your investment income.


Thanks @Charlie, I may end up working a couple extra years, we’ll see…



avrex said:


> It's a rally race. Does mookie have enough fuel to reach each targeted destination?
> Are you firm with your plan to stay in your current home, until age 60?
> Would you consider downsizing your home earlier, in order to add to your investment assets?


Thanks @avrex, since we have kids, we probably wouldn’t downsize any sooner than 2023, but I think we would likely stay here until 2028 as planned. I know not everyone will agree, but I believe that investing in our primary residence is equally as good as investing in the stock market, and there is no capital gains tax to be paid. :chuncky:



CanadianCapitalist said:


> The 4 percent rule is not applicable here. The original 4 percent rule was based on the assumption that someone retires at age 65 and wants the portfolio to last 30 years. The withdrawal rate for someone retiring in their mid-forties is a lot lower, probably in the 2 percent range because the portfolio has to last pretty much forever.


Thanks @CanadianCapitalist, and @MoneyGal on the 4% rule. I agree that my withdrawal rate would be above 4% until my gov’t pensions kick in, so the question is will my money last? Hopefully @steve41's analysis can shed some light on things.


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## GoldStone

Four Pillars said:


> MoneyGal said:
> 
> 
> 
> We should probably abandon the 4% rule for planning purposes
> 
> 
> 
> Please don't tell me I have to save even more than I already have to!!
Click to expand...

I have long used 3% in my planning. To draw 50K pre-tax income @ 3% SWR, one has to save...


_wait for it..._


_wait for it..._


_wait for it..._


 *1,666,666.666*


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## marina628

I don't know how to use my 3 year old washer and dryer because my husband retired at 42 years old and has lots of time for laundry :chuncky: 
Having him at home cost a paycheck but we cut back on fuel expenses ,his clothing allowance less eating out because he cooks more at home.I still work and we are business owners but we had a plan when he retired and each month we are spending less and less.One thing that made the transition easy is because we bought the big ticket items before he left his job and had about 6 months where we lived on our budget before he left the job.


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## Mookie

steve41 said:


> If I run your numbers, I would need to know both gross salaries if even for a year.


Hey Steve - you're the man! Thanks for the analysis! Looking through what you provided, it actually came out pretty close to my own projection. According to your projection, I will be fine spending $53K per year in today's dollars, and will still have $1.9M left over (and my principal residence) when I croak at 95. 

So, despite the skepticism from some, it seems that if my assumptions are right (4% return, 2.5% inflation etc) then I should be good to go. Of course nobody can predict the future, so I may still work an extra year or two to play it safe, or to allow for a few extravagent expenses from time to time in retirement.


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## Sampson

Mookie said:


> it seems that if my assumptions are right (4% return, 2.5% inflation etc)


Assumptions are assumptions, they cannot be confirmed a priori.


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## Mookie

Sampson said:


> Assumptions are assumptions, they cannot be confirmed a priori.


True enough, but all plans are based on assumptions. The key to a reasonable plan is reasonable and conservative assumptions. Besides, if I decided to play it ultra safe and work until 65, I would be assuming that I'm going to live that long.


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## Young&Ambitious

And if everything doesn't work out as planned, there's always the backup plan: the children :biggrin:


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## Jon_Snow

This thread has proven encouraging.

See ya on the otherside in March 2014 Mookie!


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## Four Pillars

Mookie said:


> I’ve seen too many people around me come down with medical issues in their 40’s, 50’s or 60’s, and I would hate to be one of those poor schmucks that die before they even start their retirement.


Am I the only person on this board who is capable of working a full time job and enjoying life at the same time?

Me thinks that a good portion of people who are unhappy pre-retirement will also be unhappy in retirement - but they will complain about different things.


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## leoc2

> Me thinks that a good portion of people who are unhappy pre-retirement will also be unhappy in retirement - but they will complain about different things.


Mike you are on to something....Hmmmm


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## RBull

Good news Mookie. Thanks for taking the time to respond to all and good luck with your retirement next year. I'm not far behind you in that.


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## MoneyGal

Four Pillars said:


> Am I the only person on this board who is capable of working a full time job and enjoying life at the same time?
> 
> Me thinks that a good portion of people who are unhappy pre-retirement will also be unhappy in retirement - but they will complain about different things.


Good one! 

p.s. You are not alone.


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## andrewf

Four Pillars said:


> Am I the only person on this board who is capable of working a full time job and enjoying life at the same time?
> 
> Me thinks that a good portion of people who are unhappy pre-retirement will also be unhappy in retirement - but they will complain about different things.


+1

It might be nice to be able to job share and work maybe 40 weeks a year, but full retirement at 40 is not something I would want.


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## Sampson

I also enjoy my line of work. 

In fact, my plan when I become financially independent is to take a huge paycut and go back to school to do a PhD. Now who in their right mind would lose 80% of their salary yet do essentially similar things? That would be someone whom enjoys/loves what they do, and are fortunate enough that they could do it for another 40 years if desired.


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## Plugging Along

I really enjoy my work too, enough that CHOOSE to be there away from the kids (I adore my kids too). My spouse makes enough that I could 'retire' by 40, but why? We love our lifestyle that allows us to do work hard, and play harder. 

I have always had the attitude that if I am not enjoying what I am doing then I need to change it. I think that has allowed me the confidence to excel and do what I want. 

Also, I remember reading about the message parents are sending their kids by complaining about their work. Many parents tell their kids to do well in school s they can learn and get a good job or learn something that can support themselves. Yet, what role modeling do we provide for our kids to work hard if we complain about our own jobs. I think we should be happy with what we have, and if not do something about it. 

Off topic, the funniest thing my 7 year who is well ahead of her peers and gets extra work to challenge her said 'You know what you get for working hard? More work.... So and so can barely write their name, and once is done gets to do what they want, me I have to continue writing chapters... How is that fair?'

I said with the straightest face I could '. Yeah, that is really unfair for so and so, he doesn't get to learn very much, and doesn't get to have all of the teachers knowledge. It's unfair that he won't have a choice to do things you do because he doesn't know how....' 

That seemed to satisfy her... For now.... Maybe it's a change of perspective is what people need.


----------



## Plugging Along

Back to the OP, I think you have done really well, You didn't mention how old your kids are. I would say that kids are one of the large non owns when it comes to finances. Outside of the resps, did you have intent to help them other ways, this can really change retirement. How old will they be at retiring time?


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## skiwest

Four Pillars said:


> Am I the only person on this board who is capable of working a full time job and enjoying life at the same time?
> 
> Me thinks that a good portion of people who are unhappy pre-retirement will also be unhappy in retirement - but they will complain about different things.


True , if unhappy with life just not working isn't going to solve that. But if weekends are twice as 'happy " as rest of week then won't it equate that once retired would be happy going from 9 to 14? Thats 55% more happy by my calc. My wife retired about a year ago. I get no sense of regret from her, skiing 50 days this year plus riding ( horse) a couple of times a week. 

There is a sticker in the rockies ( banff/ golden etc) " My life is better than your vacation" 

My goal next year is to ski 120 days - 80 resort and 40 sled tour or straight tour back country
Be able to look out from top of Kicking Horse and say I've been to the top or near top of 6 of those mountains up from 2 right now.


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## skiwest

I want to wake up to this view every morning , not just on weekends


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## Four Pillars

Haha - nice pics Skiwest. 

Don't get me wrong - I'm not knocking retirement or the ability to work part time etc. But most of us have to work full time for a certain number of years before we get much in the way of reasonable life choices.

The reality is that if I retire too early - I won't be able to afford to downhill ski.

As far as work goes - of course not everyone 'loves' their job - but even if you hate it - is your entire life about the job?


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## Plugging Along

Four Pillars said:


> Haha - nice pics Skiwest.
> 
> Don't get me wrong - I'm not knocking retirement or the ability to work part time etc. But most of us have to work full time for a certain number of years before we get much in the way of reasonable life choices.
> 
> The reality is that if I retire too early - I won't be able to afford to downhill ski.



I have to admit, if I could spend the way I do in retirement as I do while working, then I would retire earlier. I don't want my working life t be miserable and my retirement not to have enough.

So far what I have seen is those that want to retire early have reasonably frugal lifestyles. How much skiing, travel, luxury do they have? I am not saying they need it but that's what i want my retirement to look like. Week long ski trips, big vacations with the family, not worrying about the needs, and having a lot of the wants. When I have enough there, then I may consider retiring. Until then, I will take my work hard play harder approach.


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## Four Pillars

Plugging Along said:


> So far what I have seen is those that want to retire early have reasonably frugal lifestyles. How much skiing, travel, luxury do they have? I am not saying they need it but that's what i want my retirement to look like. Week long ski trips, big vacations with the family, not worrying about the needs, and having a lot of the wants. When I have enough there, then I may consider retiring. Until then, I will take my work hard play harder approach.


I'm in agreement with you. Part of the desire to work less is to have more time doing things I like to do.

But if some of those things cost money - then where will the $$ come from if I've only saved enough for a frugal lifestyle?


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## Mookie

Plugging Along said:


> Back to the OP, I think you have done really well, You didn't mention how old your kids are. I would say that kids are one of the large non owns when it comes to finances. Outside of the resps, did you have intent to help them other ways, this can really change retirement. How old will they be at retiring time?


My kids are 12 and 9 right now. As shown in my original post, we have set aside money for their education through an RESP, and i have budgeted for their living expenses until they move out on their own. We don't plan to buy them cars or houses, as I think that really does them a disservice in life.


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## Mookie

I don’t think I ever said that I was unhappy with my life now while I’m working, nor did I say that I dislike my job. What I have discovered though is that the closer you get to financial freedom (and the older you get), the more valuable time becomes. Right now I can only spend a maximum of 2/7 of my time on fun stuff, because I’m at work the other 5 days of the week. Of course having free time is not as enjoyable if you can’t afford to do anything with the time. 

@skiwest is a perfect example of this – he’s out there doing what he loves with his time, instead of sitting in a cubicle all day. I’ve got my hobbies too, and the cost of them is baked into my annual cost projections. Just like @skiwest, I’m pretty sure I would enjoy my life more if I spent more of it on hobbies, and less of it in cubicles.


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## skiwest

Plugging Along said:


> I have to admit, if I could spend the way I do in retirement as I do while working, then I would retire earlier. I don't want my working life t be miserable and my retirement not to have enough.
> 
> So far what I have seen is those that want to retire early have reasonably frugal lifestyles. How much skiing, travel, luxury do they have? I am not saying they need it but that's what i want my retirement to look like. Week long ski trips, big vacations with the family, not worrying about the needs, and having a lot of the wants. When I have enough there, then I may consider retiring. Until then, I will take my work hard play harder approach.


I agree with you totally. What good is it to save and save just not to work and have so little money all you can do is watch TV and eat crappy food because its cheap. I'm at the point where I can travel with out spending a lot of $$ as have done the around the world thing with work and other than one big 6 or 8 week trip to use up points , I can do without. I'm going to a location where I can ski at one of the best ski hills in the country that pulls in people from around the world and its 30 minutes away. I'm going to living in a place where truely as per the sticker " my life is better than your vacation".

I won't have to work with the money I have saved up but I may , of course after taking next winter off to ski every day, if I want to get $ for a big trip or something like that. But that that time I can weigh work vs trip and all the money from work is against that expressed purpose.

my budget includes ski passes $2000 plus $1500 a year gear which I don't need for a while as I have 7 pairs of skis and wife has 6 so I'm set for while.

I don't think I've saved much in the last 12 months as I've been buying stuff, new sled biggest made, welder, stuff for climbing wall, built a barn 54'x 63', couple pairs of skis, all new cordless, new table saw, new miter saw....


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## RBull

No, you aren't alone. 

When I was working full time I enjoyed life. Now working part time I am enjoying life. When I am fully retired I expect to be enjoying life. 

Unhappy people are just that- employment or retirement may well not be at all related. 




Four Pillars said:


> Am I the only person on this board who is capable of working a full time job and enjoying life at the same time?
> 
> Me thinks that a good portion of people who are unhappy pre-retirement will also be unhappy in retirement - but they will complain about different things.


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## My Own Advisor

@Mookie,

You raise a great point IMO. I don't dislike my job but I know if I had the same income as I do now, without any financial obligations, I'd be much happier. Why? Because I can choose how to spend my time. My time is largely chosen for me, now, meaning, I need to work to live.

In my late-30s, I realize time is precious. Time didn't matter as much in my 20s. Probably because I could stay up all night and party


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## avrex

Mookie said:


> - I don’t think I ever said that I was unhappy with my life now while I’m working, nor did I say that I dislike my job.
> - Right now I can only spend a maximum of 2/7 of my time on fun stuff, because I’m at work the other 5 days of the week.
> - I’m pretty sure I would enjoy my life more if I spent more of it on hobbies, and less of it in cubicles.


I completely agree with the above statements.

I have many interests/projects/hobbies that I 'love'. 
Unfortunately, these passions do not translate into a paying salary.

My jobs have ranged from 'like' to 'ok'. However, I have never found a job that I 'love'. 
To those of you who have found that job, that pays you and that you 'love', I salute you.

In the meantime, I'm enjoying life. I'm not being ultra-frugal. I spend money on things that I enjoy.
However, I also continue to save money, so that I can leave the job market as early as possible, to have an even more enriched life.

Will I ever get bored or be unhappy, by retiring early? The answer is, *Never.*


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## Jon_Snow

At some point I have just come to the conclusion that I want to start living life on my terms. For me, that means quitting my job - kudos to those who have occupations that make them happy - I haven't been so fortunate. But the job has paid well over 25 years and put me in position to do this. 

By March 2014 I will have close to a million in investable assets, a wonderful wife who wants to keep working a while longer (six figure salary), several properties (mortgage free), no other debt, an ability to "play hard" on 30k yearly, and no children to support. And a seven figure inheritance in the hopefully distant future. Nobody seems to want to talk about inheritances, but it has to be factored in, IMO.

In the "General Discussion" thread there is topic going discussing CMF'ers hobbies. I like to kayak amongst Orcas and listen to their underwater chatter with a portable hydrophone. I have other "hobbies" that give me a similar thrill. Thanks to my job and its demands, I don't actually get much opportunity to do these things that I love. Screw that.

Frankly, the more I look at things, I'd be a bit of a fool not to quit working. There is sometimes the thought of perhaps finding a career I don't detest. But then it hits me: I just don't need to work anymore.


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## none

Yeah, working is for suckers. If working was so much fun why would they have to pay you to do it.

Good for you.


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## My Own Advisor

@Jon_Snow,

GREAT for you Jon. Sounds like you're set and you're totally doing the right thing.


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## Mookie

none said:


> Yeah, working is for suckers. If working was so much fun why would they have to pay you to do it.


I couldn't agree more! LOL


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## donald

For ''young'' retiree's (the under 40 millionaire's or budding millionaire's-natural wealth builder's)I think it is just leaving behind the traditional life-path.....''I did it my way" and i think that inner-knowledge or realization you ''broke-free" is what it is about.

Anybody that has a goal to become wealthy/Er and makes that happen before 90% of the population is obviously goal centered/independent thinker/above average intelligence ect ect.It is just clearing the ''1st'' phase.

Anybody who self-directs(which are almost all the ''under 40'')is doing it because obviously it is a natural interest and very likely a natural innate skill/ability ect(otherwise they would not be doing it or hanging around money forum's/investing forum's/investing blog ect On their own time)

If you are a self-directed early millionaire running your own portfolio i'd argue you are simply a business man/women and you might not even realize it---''you found yourself in the process"?Look at how passionate some cmf member's are here about personal finance/investing/blogging ect/money----building portfolio's/the challenge of the market/the high's the low's being right being wrong/learning,there is no end point in investing.

Is it not likely some just want to be a investor?maybe it has nothing to do with er(or money for the matter).Also to use frugal trader for example(because he fit's the description)By the time he is 45 if he keeps on his life path he will have a portfolio of several million.That is work....Is it about beach houses and bmw's @ the end of the day for the typical profile of the early under 40.....you would'nt go through a process like that and then suddenly desire roman noddles and enough to just get by and check out.(your intellect would demand more,you would'nt find yourself in the position otherwise)


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## fraser

I would consider downsizing you house prior to retirement for a number of reasons. First of all, you will have a solid number on just how of the equity will end up in the retirement fund. It may be less than you think.

Secondly, why not realize the benefits of a downsize when you start your retirement, ie less property taxes, lower utility bills etc. Don't forget, those downsizing savings are after tax dolllars....money that can be spent on travel, vacations, etc. Those are the 'good' dollars.


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## skiwest

Jon_Snow said:


> ....And a seven figure inheritance in the hopefully distant future. Nobody seems to want to talk about inheritances, but it has to be factored in, IMO.


True , for me its not big as will be split 6 ways and already have decided to give to daughter anyway. But it can work other way as my in laws though made good money spent it all plus some. Though this has worked out for me as they hate me so my wife will never ask for anything for them. Parents can be a liabilty. Has anyone seen the recent court cases where really terrible parents sued kids for support.


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## Four Pillars

none said:


> Yeah, working is for suckers. If working was so much fun why would they have to pay you to do it.
> 
> Good for you.


Silly stuff - work is for people who want to make money.

If you have enough money you don't need to work, good for you. No need to make the rest of us hard-working folks feel like suckers...


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## Plugging Along

donald said:


> For ''young'' retiree's (the under 40 millionaire's or budding millionaire's-natural wealth builder's)I think it is just leaving behind the traditional life-path.....''I did it my way" and i think that inner-knowledge or realization you ''broke-free" is what it is about.
> 
> Anybody that has a goal to become wealthy/Er and makes that happen before 90% of the population is obviously goal centered/independent thinker/above average intelligence ect ect.It is just clearing the ''1st'' phase.
> 
> Anybody who self-directs(which are almost all the ''under 40'')is doing it because obviously it is a natural interest and very likely a natural innate skill/ability ect(otherwise they would not be doing it or hanging around money forum's/investing forum's/investing blog ect On their own time)
> 
> If you are a self-directed early millionaire running your own portfolio i'd argue you are simply a business man/women and you might not even realize it---''you found yourself in the process"?Look at how passionate some cmf member's are here about personal finance/investing/blogging ect/money----building portfolio's/the challenge of the market/the high's the low's being right being wrong/learning,there is no end point in investing.
> 
> Is it not likely some just want to be a investor?maybe it has nothing to do with er(or money for the matter).Also to use frugal trader for example(because he fit's the description)By the time he is 45 if he keeps on his life path he will have a portfolio of several million.That is work....Is it about beach houses and bmw's @ the end of the day for the typical profile of the early under 40.....you would'nt go through a process like that and then suddenly desire roman noddles and enough to just get by and check out.(your intellect would demand more,you would'nt find yourself in the position otherwise)


You take about the journey and doing it your own way. I fully understand this journey. Everyone in my family has made it on their own (no inheritances or gifts) and became millionaires /multi millionaires while in their thirties. However, none of them did so they could retire early, they continued working and doing bigger things. They are all entrepreneurs and run business's. I guess I see a difference between trying to achieve verses trying to get out of the rat race. It just sounds awful to HAVE to go to work every day at something you don't like.


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## Jon_Snow

Yeah, if I was lucky enough to have a job that brought me as much satisfaction and happiness as my "hobbies" do, I would have no problem continuing to work. I've been been beaten down by my career for so long now that I am just feeling a bit selfish and want to now maximize my happiness. Fortunately, finances are now at a point that this is possible.

Amongst my group of cohorts, there is not alot of job satisfaction going on... but if this forum is any indication, there actually exists people who ENJOY going to work everyday. Well, heck, my wife is also one of them. 

Plugging Along, you definitely seem to have found the sweet spot....


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## jcgd

I've generally hated my job, but I've hit this lovely patch over the last four months where I have been given more responsibility, more chances to learn and a few people under me. I must say I have been enjoying my job lately. I enjoy learning and being relied on. It turns out it's not my job I hate, it's boredom. I've been extremely fortunate lately and I really hope the trend continues. 

I don't mind working, but I have greater aspirations than just being another number. I want to contribute to something in a significant way.


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## Mookie

fraser said:


> ...why not realize the benefits of a downsize when you start your retirement, ie less property taxes, lower utility bills etc. Don't forget, those downsizing savings are after tax dolllars....money that can be spent on travel, vacations, etc. Those are the 'good' dollars.


Good point - the only challenge for me is that I have two young kids, so we'll probably have to wait unil they move out.


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## Plugging Along

Jon_Snow said:


> Yeah, if I was lucky enough to have a job that brought me as much satisfaction and happiness as my "hobbies" do, I would have no problem continuing to work. I've been been beaten down by my career for so long now that I am just feeling a bit selfish and want to now maximize my happiness. Fortunately, finances are now at a point that this is possible.
> 
> Amongst my group of cohorts, there is not alot of job satisfaction going on... but if this forum is any indication, there actually exists people who ENJOY going to work everyday. Well, heck, my wife is also one of them.
> 
> Plugging Along, you definitely seem to have found the sweet spot....


Jon - Do not feel selfish for wanting to maximize your happiness. You are not doing at the expense of others. I am a little jeolous of you when I was reading the hobby thread. You have a clear direction on what will make you happy, and work is just providing you the means to get there. I think it's really smart how you have planned out your finances and have such a clear plan. I LOVE a great plan!


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## Plugging Along

*Why we are not retiring*

Grrr.. can't get a pic up =(


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## celishave

CanadianCapitalist said:


> The 4 percent rule is not applicable here. The original 4 percent rule was based on the assumption that someone retires at age 65 and wants the portfolio to last 30 years. The withdrawal rate for someone retiring in their mid-forties is a lot lower, probably in the 2 percent range because the portfolio has to last pretty much forever. That would mean $50K pre-tax can probably be safely harvested from a $2.5 million portfolio. Just my 2 cents.


This is absurd. You are not factoring in CPP/OAS. The inverse calculation can be used to estimate what their cpp/oas is worth today. $26,000 per year at 3% withdrawal rate has a value of approx $850,000. I agree though 4% is not sufficient for an early retiree and for myself I am planning on 3% MAX.


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## Rainman9440

So my question is how do you overcome the paralysis that goes with having read too much? Over the past 3 years I have read almost every retirement document, book, article etc and found myself scared to death of several aspects of retiring. First and foremost in having sufficient financial backing to enjoy the lifestyle I want to and second of being bored or losing myself in the retirement boredom. I did retire from a government job in 2011 after 32 years on a 64 % pension which is indexed and I get my benefits paid until I am 65 including a life insurance policy. My pension is approx. $101,500 a year. I took a 3 year appointment which pays me $143,000 with the federal government and at the end of next year I will receive a further approx. $8,800 pension a year for life. This position also comes with full benefits. My wife retired after 17 years of teaching which she did not start until she was late 30's so her pension is approx. $14,000 a year + a small $ 3,500 annual pension she gets from a previous government job. We have about $350,000 invested and are currently investing about $75,000 annually while I am working the contract along with about $225,000 in cash from the sale of our home. We are renting in the city that I am working for the government currently and we do not own any real estate.. I am 55 and my wife is 54 years of age. What concerns me is that everything I have read that seems to pertain to me is stating that I should have about $1 million or more in cash to be able safely consider retirement as well as a home etc. We have two brand new cars (2012) worth about $55,000 and a newer motorhome which we like to travel in that has a current value of approx. $ 160,000. All the vehicles are paid for. I don't think we have enough money saved to be free from the stress of retiring but I need to make a decision if I am going to renew my contract for a further 5 year term or retire. There are days that I think we should be okay and others that I panic afar reading another article about needing a lot more cash than I have. Perhaps I need a reality check and I am asking those who are on here for your thoughts about my situation. I am well aware that we are likely better off than many however that does not negate the worry. I have my money invested with a financial planner on a fee for service basis and he has advised me that I can and likely should retire sooner than later however I am still concerned and quitting work while I am earning this large an income seems like a bad idea but I am just at a loss.


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## Spudd

Those "you need a million dollars to retire" articles are talking about people who don't have a pension. As long as you can keep your current lifestyle on your combined pensions, which seems to be around $125k/year, you'll be fine. Have you tracked your annual spending to see how much you consume? Will you get the full pension if you retire before 65?


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## MoneyGal

The other side of that "you need a million dollars to retire (unless you have a pension)" rhetoric is "a government-backed, inflation-indexed pension of $65K for life _is worth more than a million dollars_". That might be part of the underlying rationale for the argument, self-interest of the financial services profession aside.


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## Hawkdog

great thread people, I got a lot out of that discussion.

Congrats Mookie! Job well done!


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## Mookie

Rainman9440 said:


> What concerns me is that everything I have read that seems to pertain to me is stating that I should have about $1 million or more in cash to be able safely consider retirement as well as a home etc.


Your company pensions total $128K / year (plus CPP). So long as your expenses in retirement are less than this, you actually don't need a dime in savings to retire.


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## GoldStone

Rainman9440 said:


> Over the past 3 years I have read almost every retirement document, book, article etc and *found myself scared to death* of several aspects of retiring.
> ...
> My pension is approx. $101,500 a year.
> ...
> at the end of next year I will receive a further approx. $8,800 pension a year for life.
> ...
> My wife retired after 17 years of teaching which she did not start until she was late 30's so her pension is approx. $14,000 a year + a small $ 3,500 annual pension she gets from a previous government job.


You are scared to death? Are you kidding me? Your pensions total $128,000/year. You are laughing all the way to the bank. 

Consider this: my wife and I both work in the private sector. We have no pensions. None. Zero. Zilch. Nada. Zip. We have to self-fund our retirement with our own savings. $128,000/year is out of reach for us. To generate that amount of annual income, we would have to save over 4 million dollars. _(I assumed 3% withdrawal rate)_



Rainman9440 said:


> What concerns me is that everything I have read that seems to pertain to me is stating that I should have about $1 million or more in cash to be able safely consider retirement


That rule does not apply to you. You have your pensions.



Rainman9440 said:


> Perhaps I need a reality check and I am asking those who are on here for your thoughts about my situation.


You are in better shape than 99% of the population. You have nothing to worry about.

An aside comment not directed at you personally: government pensions are unreal. Totally out of whack with the private sector.


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## My Own Advisor

@Rainman9440,

You're in AMAZING shape for retirement.

When I read your pensions total $128,000/year, know that you're making *about $50,000 more per year* in retirement than the average working Canadian family today. I almost fell off my chair when I read that...

Your pensions are worth millions. Retire now and enjoy the good life while you have your health and happiness. As Goldstone said, few people have it that good (like you)  Congratulations to say the least!


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## HaroldCrump

GoldStone said:


> An aside comment not directed at you personally: government pensions are unreal. Totally out of whack with the private sector.


The goal of public sector pensions is a constant income re-distribution and wealth transfer from the private sector to the public sector.
Towards that goal, it is succeeding admirably.


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## RBull

I have to agree with the last 3 posts above. Especially the one from HaroldCrump. I would also add there is something wrong when government pensioners collect and then take lucrative contracts from the same employer.

Rainmann9440, surely you jest. A government job that pays that much, a wife with other government pensions and you're wondering about needing savings goals suggested for those with no pension? 

If you had read every book, article or document on retirement you would have seen clearly indicated that a secure DB pension income (at a high percentage of your previous income) replaces the need for large sums of savings to withdraw retirement funds from. That of course is as long as your spending requirements are covered by this income. 

LOL


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## GoldStone

RBull said:


> That of course is as long as your spending requirements are covered by this income.


At $128,000/year, we are talking about spending desires, not spending requirements.


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## Rainman9440

Well thanks to those who have responded and just to clarify I am currently working for the federal government on contract and retired from a municipal job with an OMERS pension which is why I can work for the feds as OMERS is not the same pension plan. Obviously I am well aware of the benefits of having the government pension(s) and am not looking to get into a debate or an argument about the sustainability of same. Just to clarify once again most people retiring with an OMERS pernsion dont earn the amount that I do. I was working at the top of my orgainisation for over 5 years so my pension worth was extremely higher than the norm for most retiring in OMERS. As I mentioned earlier, we have what amounts to, in my opinion, a very small amount of cash saved considering we don't own a home which we are planning to buy back at some point as opposed to renting. With that in mind, we don't have a substantial amount of money left once we do that. I am looking at an approximate income of about $6,500 net with the pensions based on an estimate of how I am being taxed right now. What concerns me is the replacement of 60 to 70 percent of my pre-retirenment income. When my wife and I were working we earned about $250,000 + gross. Our pensions together do not come close to the 60-70% pre retirement income now. Even now with my pension income and the current government contract of $143,000 if I leave I am looking at approximately 50% of pre-retirement income and that is what has me concerned. Everything you read says that you need to have the higher amounts of income to be safe in retirement and maintain your pre retirement lifestyle. Does your income tax change that much because again, what I am reading says it does not and that I will be taxed at the same rates I am currently. I guess the only difference is not paying CPP or EI but the rest remains. That being the case the monthly amount is not that large in comparison to what we are used to. My wife an I do not live an extravagant lifestyle and never have and despite that, and our incomes, we have not saved a lot of money to this point given the incomes we earned. We did put our kids X 3 through University and each came out carrying no debt however they have all struggled for work since graduation. By now most of you have figured out that I am not an accountant or a economist and handling money is clearly not my forte. For us we just went to work and made the money and have not given the retirment much thought until recently. The thought that the pensions are worth millions is a very abstract concept, at least to me, and its the thought of living on a fixed amount, at less than half of what we are used to without a large bankroll is concerning. It is the same worry that we have always had and it is very difficult to change your outlook after a lifetime of living with money cocnerns much the same as many of you have had to do. We did not start earning the larger amounts until the end of our careers so we do not come from money. We have earned more in the last 10 than working for the first 25 together so maybe that helps to explain.


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## leoc2

Is the original poster legit?
How can you read all the finance books and not know your pension is worth millions?
Sounds like a post made by someone trying to fan the flame of Private vrs Public pensions fire.


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## MoneyGal

I know! I was going to make the same point: surely this is a trolling attempt?


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## Four Pillars

Give the poor guy a break, we're talking about a high-level government employee. Might not be the sharpest knife in the drawer...


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## Rainman9440

Clearly I have not been able to adequately convey my issues so rathe than see this get any more nasty than its started to turn towards I'll drop this. I am not looking to get into any kind of petty argument with anyone and I am not looking at getting into any kind of debate over public pension funding.


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## GoldStone

Four Pillars Law:

A sufficiently high-ranked government employee is indistinguishable from a troll.


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## Ihatetaxes

Knowledge of paragraph structure must not be a prerequisite to a highly paid government job.


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## Spudd

Rainman, the 70% is just a rule of thumb. Currently, you're spending money on rent (which you won't if you buy a house), you're saving for retirement, and you paid for 3 kids to go through school. Track your expenses for a year and see how much you really need.


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## MoneyGal

GoldStone said:


> Four Pillars Law:
> 
> A sufficiently high-ranked government employee is indistinguishable from a troll.


This is AWESOME.


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## MoneyGal

Also, this thread is truly fascinating, from the POV of retirement income needs expressed as a ratio. If your spending is at or above your income, it doesn't matter how much that income is: you don't have enough.


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## Four Pillars

GoldStone said:


> Four Pillars Law:
> 
> A sufficiently high-ranked government employee is indistinguishable from a troll.


Lol!


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## GoldStone

Rainman9440 said:


> Clearly I have not been able to adequately convey my issues...


The only issue I see is your complete disconnect from the real world where the rest of us live.


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## RBull

Agreed. Hence the LOL at the end of my post. 



GoldStone said:


> At $128,000/year, we are talking about spending desires, not spending requirements.



Rainman9440 you have done very well indeed. 

I would retire now and never look back, unless 128K indexed isn't enough for your retirement plans. That amount buys a lot of retirement for most anyone. The best way to calculate if you have enough to retire now is to work from your projected expenses in retirement and not income in isolation. 

With your income you don't need to buy a house- just rent and keep your 300K+ in savings. As has been mentioned earlier the % rules are very general. A lot of your expenses you had before aren't there for retirement.


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