tag:blogger.com,1999:blog-8242926316765633205.post911272496987033028..comments2024-03-17T04:14:44.845-05:00Comments on Frugal Scholar: Financial Independence= X times 25Frugal Scholarhttp://www.blogger.com/profile/12696815672500452503noreply@blogger.comBlogger10125tag:blogger.com,1999:blog-8242926316765633205.post-68240242990054967412010-10-17T11:40:10.640-05:002010-10-17T11:40:10.640-05:00@Terri--it has me thinking too...Note that he has ...@Terri--it has me thinking too...Note that he has traveled a lot already, so he would put it lower than many.<br /><br />@Duchesse--Totally agree. I just meant that you wouldn't DIE if you didn't travel!<br /><br />@Shelley--That book was an eye-opener for me. I recently gave it to my son. He said "I know this stuff already." <br /><br />@FB--We have so many travel plans. We are building travel into our budget--not an add-on.<br /><br />@Duchesse--Thanks for emphasizing the importance of travel when you have mobility. <br /><br />@Funny--Yes--social security needs to be factored in. As others have said, inflation is taken into account.<br /><br />@stannius--The book "Work Less, Live More" suggests a 4% drawdown MINUS 5% in years of economic declines. Thanks for commenting and sorry about my delayed response.<br /><br />@Cubicle--Thanks for the tip. How I've missed your blog. Hoping you are making good progress toward your goals.Frugal Scholarhttps://www.blogger.com/profile/12696815672500452503noreply@blogger.comtag:blogger.com,1999:blog-8242926316765633205.post-30674797127562216192010-10-14T16:43:49.122-05:002010-10-14T16:43:49.122-05:00stannius,
3% withdrawal has historically lasted f...stannius,<br /><br />3% withdrawal has historically lasted forever, so one would need 33.33 X annual expenses or 400 times monthly expenses.Over the Cubicle Wallhttps://www.blogger.com/profile/04842722161649016062noreply@blogger.comtag:blogger.com,1999:blog-8242926316765633205.post-72059591966104456052010-10-14T12:21:37.809-05:002010-10-14T12:21:37.809-05:00This is not to devalue the overall point of your p...This is not to devalue the overall point of your post, which is to say that the less you spend, the less nest egg you need. Regardless of whether you're using X times 25 or X times 100 or any other number, smaller X = smaller nest egg needed.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-8242926316765633205.post-36245018356005142962010-10-14T12:19:39.316-05:002010-10-14T12:19:39.316-05:00I used to adhere to the 4% / 25x rule too. But rec...I used to adhere to the 4% / 25x rule too. But recently another p.f. commenter corrected me. The 4% figure is NOT for an indefinite withdrawal period. The original study was for a 30 year time period (with 95% chance of not running out of money.) Prompted by the commenter I went and read some of the studies for myself.<br /><br />Unfortunately I don't know what the replacement number is. There's got to be some number that you can use. College endowment funds have a goal of spending without burning principal, so we should be able to do the same somehow.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-8242926316765633205.post-68294984836514032462010-10-13T19:33:35.805-05:002010-10-13T19:33:35.805-05:00It's a good rule of thumb. But it doesn't ...It's a good rule of thumb. But it doesn't take Social Security into consideration. During at least some part of your retirement, you can reasonably expect to receive Social Security payments. <br /><br />So your calculation is not monthly expenses x 12 x 25 = required nest egg.<br /><br />It's monthly expenses - net monthly SS benefit x 12 x 25 = required nest egg.<br /><br />If you plan to retire before you're eligible to collect social security, then you would have to adjust your figures to show the amount you would need between Retirement Year 1 and Social Security Benefit Year 1. As to what that formula might be, I dare not hazard a guess.Funny about Moneyhttps://www.blogger.com/profile/13188173788063351801noreply@blogger.comtag:blogger.com,1999:blog-8242926316765633205.post-83816318578622070992010-10-13T11:56:37.121-05:002010-10-13T11:56:37.121-05:00Yes, travel now. And you may also travel 'then...Yes, travel now. And you may also travel 'then', but perhaps your trips will be shorter or closer to home. I once worked with a group of professional tour guides, who told me, "Our job is hauling half-dead people around Europe". They said it with compassion, but meant it.Duchessehttps://www.blogger.com/profile/09986153653120526776noreply@blogger.comtag:blogger.com,1999:blog-8242926316765633205.post-2125182757638011662010-10-13T07:49:47.061-05:002010-10-13T07:49:47.061-05:00That's how I calculate what my retirement shou...That's how I calculate what my retirement should be ---- expenses x years lived.<br /><br />Don't forget inflation and cost of living in the area, seeing as you may not retire where you live<br /><br />As for travel, I'm doing it now, so I don't regret it when I'm older when I don't go back to Japan, for example.FB @ FabulouslyBroke.comhttps://www.blogger.com/profile/12966672580040786485noreply@blogger.comtag:blogger.com,1999:blog-8242926316765633205.post-83126229309580594142010-10-13T02:47:58.709-05:002010-10-13T02:47:58.709-05:00The book Your Money or Your Life by Dominguez &...The book Your Money or Your Life by Dominguez & Vicki Robin first brought home to me the idea that we exchange the (limited) hours of our life for money and then spend that money on stuff. I have likely traded years of my time on earth for things I don't actually value. This is an idea most of us avoid because we don't like thinking about what Privilege calls The Death Probelm. Jacob's approach avoids looking at that angle and looks at it a different way. Anything that helps me be more conscious about how I'm spending money has to be a good thing as far as I'm concerned. "Gimmick" is apparently marketing language and we swallow that bilge all the time without a second thought. What Duchesse says is just how Bill and I are thinking - how much more travel can we manage before we're too old to enjoy it?Shelleyhttps://www.blogger.com/profile/10239488936038510294noreply@blogger.comtag:blogger.com,1999:blog-8242926316765633205.post-26037781025805043802010-10-12T18:29:07.005-05:002010-10-12T18:29:07.005-05:00What is sobering is to see the stats; spending for...What is sobering is to see the stats; spending for travel peaks from age 65-early 70s, then trends down gradually to around 80, when it more or less stops. It's not that you won't be around, but you (or your partner) will travel a lot less then.Duchessehttps://www.blogger.com/profile/09986153653120526776noreply@blogger.comtag:blogger.com,1999:blog-8242926316765633205.post-85578529248372503722010-10-12T15:34:17.651-05:002010-10-12T15:34:17.651-05:00Well, it might be a gimmick, but it has me thinkin...Well, it might be a gimmick, but it has me thinking. I also like how he has ranked priorities, so travel is somewhat down the list.Anonymousnoreply@blogger.com