patrick.net

I'm the same way - not gung ho about actually stopping working, but desire financial independence so that I could retire early if I want to, or otherwise work on my terms. My aggressive savings in recent years came in handy these past 2 years, as covidian threats from my employer have bounced right off me. I called their bluff a few times and they always folded. Many of my coworkers couldnt risk such a stance because they needed the job.

Anyway, if you aren't already using them yet, I highly recommend using FIRE calculators to help you model if your portfolio can support you for 30-50 years or w/e your expected retirement is. The fire calcs work by running a bunch of "retirement simulations", and then aggregate the results of each sim and show you stats about the results. For example, if you have a 30yr retirement, and input you will start retirement w/ a $1M portfolio, then the first simulation will assume you retire from say 1920 to 1950, and they use the historical stock, bond, and inflation performance of those years to model it. The next sim is 1921 to 1951, then 1922 to 1952 and so on each year until current years. So they basically use historical stock market data and model how you would have done for every possible retirement year as a way to model how people have historically performed.

It's not that I think the calcs are some highly accurate tool which guarantee financial success in retirement, but rather that they can teach you a lot about the mechanics involved in a retirement portfolio. You can see which years a heavy stock allocation did well, and did poorly. And then you can change to a heavy bond allocation and see how that works etc... Pay attention to:

- what circumstances portfolios typically fail in (i.e. a market/portfolio crash early in retirement is devastating, and cutting back on spending can make an enormous difference)
- what your portfolio weak spots are, and what tradeoffs you get from the different ways you can address the weak spots.

The value is in tweaking a single variable at a time, and then studying how it affects the outcome. For example, you'll eventually notice that the majority of the failed simulations occurred when retirement began in a year right before a large market crash. These are your worst case scenarios, and where you should focus your efforts on improving. What works better to mitigate those scenarios - increasing bond/fixed income allocation, or just cutting spending during a crash? If youre considering increasing bond allocation to help address it, pay attention to how it affects the majority of sims in terms of overall money - basically, trading stocks for bonds hurts your overall portfolio growth in many cases, and this means less play money, sometimes significantly. The point is be aware of the tradeoffs. Reducing spending for 2-5 yrs in the event of a market crash is really effective. People dont like to do that, as they want to enjoy retirement, but you might be able to retire 5-10 years earlier if youre willing to cut spending during a crash. I'm just naming some of the many things to consider.

For mechanic-studying purposes, I recommend keeping it simple, and avoid adding all kinds of income sources that start at various years etc...that stuff makes it impossible to learn from the results due to adding complexity.

You need to be interested, analytical, and a bit mathy to really benefit from a tool like this. Most people dont fit that description. But for those who do, I think it's time very well spent. I bet most people could work for a handful of extra years, saving the money, and it still wouldnt help increase their retirement portfolio success as much as just spending maybe 20-100 hours with a modeling tool like this. It takes some time to learn how to use the calcs and what all the different options mean, but personally I think its worth it.

My favorite fire calc is cfiresim.com

Lossa things to take into consideration. The earlier you retire, the more nut you need. Every five years of early retirement will consume hundreds of thousands of dollars from the pot. Also, do you have relatives you can fall back on, or are relatives falling back on you i.e. are parents financially independent, or will they need assistance from you as they age. Can you look forward to inheritance, or even a paid off house you can live in? Do your children need chronic parental outpatient care, too? What is your life expectancy based on relatives? Some early retirees wind up with an unexpected major illness for them or spouse that winds up eating up their portfolios before they are 65 medicare age.

Do you have a profession you can re-enter if necessary with ease even if you are older? Can you have a 'semi-retirement' with part time work and long periods of vacation to enjoy your retirement?

I had no inheritance, my parents were dysfunctional and I told them to bite off a long time ago. My father left me a 'fuck you' bequest of one dollar so I couldn't challenge his estate, and my sisters basically took everything from my mother that was inheritable when she was alive, and I heard nothing after her death. I wound up paying my mother's expenses the last couple of years of her life and her funeral, though my brother and my sister took her in and handled her requirements. I was happy to do it, and grateful my brother took on the direct care. My sisters were useless, even the one who divorced out of a wealthy marriage, but one of them did help my mother spend her money when she was alive and did do things for her.

My wife got a small inheritance after we were already financially independent. However, her brother was executor of her mother's estate and basically just took other monies my wife was due. I told her not to challenge and forget about it, since her sibs were all kind of down in their finances and we weren't.

That being said, I think the present time is the classic scenario for NOT retiring if you have a steady job with benefits. I do know people even in Santa Cruz who manage to live there on shoestring. I think it involves a certain amount of anxiety and living in mobile home parks with rent control These parks are fading. The ones in CIty of Santa Cruz lost all rent control a few years ago because they couldn't pay for real estate moguls suing the city to return the properties to free enterprise status, so who knows how long rent control will last in the County.

Just two years ago pre-Biden, a steady pension of 60K a year after taxes might have sounded pretty good. Now, with the Biden pay cuts, that 60K is probably worth less than 50K equivalent spending power and dropping rapidly. There is no realistic way to compensate for that short of lottery luck investment strategies.

Ceffer says

a certain amount of anxiety and living in mobile home parks with rent control These parks are fading

Yep.

Mobile home parks in Silicon Valley were my backup plan for decades. But the high prices are threatening them. Since I retired I've delivered meals on wheels to such parks all over the valley We can see the different stages of the fade.

Seniors on fixed incomes that don't keep up with living expenses. Over time their mobile homes look increasingly shabby. The shabbiness seems roughly congruent with other outward signs of how they're doing like the age and amount of faded/peeling paint, cracks on tires of the cars parked in their spot. Some parks with lush landscaping and well paved roads, others look like some shabby outpost in the Mojave Desert.

One park wedged between the huge new Micron Technology and Samsung office buildings in North San Jose is tipping between lush and shabby. Some homes with old beater cars parked in front look like they're about to fall apart. Others with status symbol cars like Teslas and European luxury sedans are in different states of repair. Massive portion of the homes in that park have for sale signs in front. Not sure what you're buying, but apparently few buyers. It's clear what is going on: some Hipster Techies thought they could outsmart the high housing prices by living in a mobile home park, either by owning or sublet rental. Fun while it lasts. Clearly the owners know the park is in danger.

The local government seems to be more beholden to local labor unions and the funding of their pensions, than where displaced mobile home park residents would live. F*ck them: we want the re-development and the super high increased tax assessments to fund our needs.

I did retire at 55 because I was having an exceptionally good year in the stock market. A lot of those gains have gone away, but I'm still in no immediate danger of actual work. It helps that wife works as a teacher, though that's not consistent. Maybe she'll work again in the fall, or maybe not. It's OK either way.

I exercise a lot, read paper books, work on genealogy, and fix bugs on patrick.net. If I can continue like this until I drop, I'll be happy.

The main thing is to keep your expenses reasonably low.

Along with thinking about FIRE, taking care of your health should be a top priority. Take care of yourself so you can take care of your beloved ones.

Paying off the house is great if you don’t know how to generate more than 3-4% return (borrowing cost on the house). It also provides a great piece of mind with a paid off house. Then get a HELOC on the house in case some opportunity arises.

With respect to contributing to retirement, it’s “live less now so you can live less later” based on my philosophy. You may consider on earning more so you can spend more and save more.

Lastly, find something you love to do so you can work until the day you die, and you can take time off anytime you want. You work because you want to, not have to.

Is there a 'Caligula Fund' for investing in hooker and cocaine futures?

mell says

it's glycemic index is quite low

Carbs want fat. Coating and consuming with a healthy fat, EVOO or pastured butter etc., helps with the glycemic load, I believe.

In the for what its worth, and since we are older than most of you folks, wife and I retired at 53. Skied, exercised, golfed, traveled, etc., but after 7 years wife and I got bored beyond belief. We both need something to accomplish so we are starting another business, while maintaining our exercise regime. We can golf later. We are figuring we can retire again at 70 plus.

Don't worry excessively boys. I go to estate sales most weekends and at the bitter end it amounts to a house full of junk that somebody is trying to get rid of so they can divvy up the proceeds. I also walked my dog around a cemetery for years and was constantly reminded of the best-laid-plans nature of it all. I still have to hustle but some of my more affluent buddies are a little bored I think. I turned 69 today. I outlived most of the reprobates that I came up with....

Robert Sproul says

I turned 69 today.

Happy Birthday!!

I hope your affluent but bored buddies can come up with some public service that is needed but cannot be paid for. For example, doing all the financing, planning, procurement, politics, and legal work to put up a youth Rec Center in an underserved part of town.

Robert Sproul says

mell says

it's glycemic index is quite low

Carbs want fat. Coating and consuming with a healthy fat, EVOO or pastured butter etc., helps with the glycemic load, I believe.

Adding fat to a meal does slow digestion and thus reduce insulin spikes. But carbs in general are just kinda aggressive in stimulating insulin release, and insulin takes the fuel out of your blood and crams it into storage, such as your muscles, and into bodyfat. It's possible the addition of fat to the meal ends up with much of the calories from the fat you ate getting shuttled right into storage/bodyfat because you will still have a moderate insulin spike from the meal.

I think ideally, you want that fuel floating in your blood for relatively longer (and/or digested slower), where it can be easily used as fuel over a longer period of time, and help prevent you from getting hungry again too soon. Seems like a high fat, low-carb low-protein meal does just that, and it matches my personal experience - when I ate like that, I could often go 8+ hours before getting hungry, although it took a few weeks for my body to adapt.

I'm not sure sure if adding fat to a carb meal is generally a win. i.e.
400 calories all carbs = 400
vs
400 calories carbs + 100 calories fat = 500
vs
300 calories carbs, 100 calories fat = 400

The addition of the fat will certainly slow digestion and thus reduce the insulin spike, but which of those 3 leads to more fat storage when considering just that meal in isolation, but also when considering how the rest of your day will go (how many calories will you eat at next meal? How long until you get hungry again?). I'm not sure, and while I think there's an answer to that question, it prob does vary a bit by person.

Oddly, a long time ago I looked through a list of foods in an insulin study and steak/meat triggered a very high insulin response, which I didnt expect. It's not just carbs that do it.

GreaterNYCDude says

Besides what's the point in having accumulated wealth if your not enjoying life? I do want to travel... not all the time but one big trip every other year is about right.

No intention of being a dick, but this is maybe the worst thought I've heard in a while. You should be traveling NOW. Like today. 2-3 big trips a year. If solo maybe $3-4k per trip at minimum. Family gets higher.

Time is $$$$$$$$$ and memories. Piss it away on travel. I'm not joking. When you're 70 and at maybe 30% of what you are now, you'll look back on this comment and say I'm right.

Any money isn't going with you. Kids can make money when they're adults. Enjoy the fuck out of life. Look into the points game with airlines. You'd be surprised how many airlines you spend what you normally would on a CC and get free flights. Think I'm near 5 years without a paid flight unless I wanted to upgrade to 1st class.

Down year this year and probably next year with the build. Still going to Montana and Mexico this year though. Probably somewhere else or MLK weekend early 2023. Was close to pulling a last second trip to Atlanta with a neighbor for a Prog Metal festival. Kids are out of school and too much shit going on.

Hircus says

Robert Sproul says

mell says

it's glycemic index is quite low

Carbs want fat. Coating and consuming with a healthy fat, EVOO or pastured butter etc., helps with the glycemic load, I believe.

Adding fat to a meal does slow digestion and thus reduce insulin spikes. But carbs in general are just kinda aggressive in stimulating insulin release, and insulin takes the fuel out of your blood and crams it into storage, such as your muscles, and into bodyfat. It's possible the addition of fat to the meal ends up with much of the calories from the fat you ate getting shuttled right into storage/bodyfat because you will still have a moderate insulin spike from the meal.

I think ideally, you want that fuel floating in your blood for relatively longer (and/or digeste...

If you exercise a lot you want to make sure you get enough carbs. If you're just an occasional exerciser and don't need much fuel you can do (very) low carb. I don't think you need to be low carb to be healthy, just avoid excessive sugar. But if you need to lose weight low carb is the best way to go imo

mell says

If you exercise a lot you want to make sure you get enough carbs. If you're just an occasional exerciser and don't need much fuel you can do (very) low carb. I don't think you need to be low carb to be healthy, just avoid excessive sugar. But if you need to lose weight low carb is the best way to go imo

I did keto for years (this was back in the atkins era, and "the anabolic diet" variant was popular back then too). I have to say ultra low carb/keto gave me much better long term endurance/energy, but I was more of a bodybuilder who sometimes went on long hikes or played the occasional sport like tennis for a few hours now and then. But I was very active. When my diet consists of normal levels of carbs, say > 100 or 200g per day, I find I need to periodically eat to refuel or I run out of energy, with my energy feeling like it fell off a sudden cliff. But on keto I just dont seem to run out of energy, although fatigue still happens. I always assumed this was because my body was accustomed to burning fat for energy on keto, and so it became much more efficient and was able to convert enough fat to meet my sustained energy needs without having to eat.

I've heard some athletes (usually competitive or those who really push it) say they cant perform at the level they need to w/ keto, and so they prefer high carb diets. I will say I was maybe 5% or so stronger on carbs, and the effect of the additional muscle glycogen on a carb diet was visible, and I often noticed 5-10lbs gain when switching from keto back to carbs, with the majority of the weight gain appearing intramuscular due to the more constant muscle glycogen pump. Keto usually made my muscles look a bit flatter/deflated.

So ya I would agree carbs provide superior peak energy for intense exercise. But for sustained moderate energy, IME keto worked excellent. Not needing to eat so often was the benefit I never knew I liked until I experienced it.

I know about two annuities; variable annuity and fixed immediate annuity.
The CIAA-Cref has them, mine is from Vanguard but no longer sold. Fidelity probably has them, maybe T. Rowe Price too.

The variable annuity is like a non-deductible IRA with no limit.
It has sub accounts which are like mutual funds. You can put a million bucks in it, it produces no 1099 while it is in the accumulation phase.
You can change the allocation in it without a tax consequence, like an IRA.

The fixed income annuity is to provide guaranteed income for life. The advantage is they pay a good rate for you at age 70, like 7.5%.

What is a little confusing is you can exchange the variable annuity for a fixed annuity, and you can exchange an IRA for one also.

You can also take the variable annuity out as a lump sum rather than lifetime payments.

Edit: There’s no Required Minimum Distribution for a Variable Annuity, the “annuity date” can be age 99.
I guess if I live to 100 they will make me 1. Take a 100% lump sum OR 2. Take lifetime payments 😉
The IRS doesn’t know that you own it until you take money out.

https://finance.yahoo.com/news/americans-magic-number-retirement-rises-110008361.html

Americans' Magic Number for Retirement Rises to $1.27 Million

Hircus says

Oddly, a long time ago I looked through a list of foods in an insulin study and steak/meat triggered a very high insulin response, which I didnt expect. It's not just carbs that do it.

From what I've read about intermittent fasting, even if you cut out carbs and go OMAD (one meal a day), for the first several weeks or months, you still experience insulin spikes. The body remembers, and it's addicted to the glucose dumps from massive carbs. Over time, as the expected glucose dumps don't occur, the insulin spikes reduce and eventually fade out.

My diet used to be 50 - 70% carbs. I had to cut out carbs and sugary junk for almost 5 years (I've related this elsewhere on PatNet). I learned to substitute fats for carbs, since you can only eat so much protein. Later, as I got older, I started eating 2 meals a day, until now I'm OMAD. In my carb gobbling days, I would get hangry from blood sugar swings. Now I can fast up to 48 hours as long as I'm not busting my ass with physical activity. I tend to get slow after about 36 hours.

zzyzzx says

https://finance.yahoo.com/news/americans-magic-number-retirement-rises-110008361.html

Americans' Magic Number for Retirement Rises to $1.27 Million

From the article:

High-net-worth individuals – those with more than $1 million in investable assets – believe they'll need $3 million to retire comfortably.

Sounds about right.... with $3 mill I can live on the interest / dividends and rarely if ever have to touch the principal.

WookieMan says

No intention of being a dick, but

You do know the "but" negates the first part of your sentence, don't you?

GreaterNYCDude says

Sounds about right.... with $3 mill I can live on the interest / dividends and rarely if ever have to touch the principal.

Well, supposedly with absolute economy, you would be spending down the principle as well against some hypothetical projected life span, possibly even dying with a marginal negative net worth for the sibs to fight over and come up with squat. However, that would require a talented psychic to accomplish.

Hircus says

What works better to mitigate those scenarios - increasing bond/fixed income allocation

Except this time bonds crashed along with stocks.

3 million bucks is surely enough for 30-40 years of living off the money, especially assuming social security.

There are funds which pay high dividends so you're not going to deplete your capital.

I planned for no inheritance and therefore have a safety margin; a roll of the dice with AAPL was more frosting on the cake.

I expect more capital appreciation in stocks for the next 10 years; by that time I will be lazy and probably spending even less.

What scared me is how suddenly your health can change over age 65. I see it all around me.

I would buy more time if the devil would sell me some, like a Twilight Zone episode.

Eric Holder says

Except this time bonds crashed along with stocks.

Which is why you always hold bonds to maturity.

Booger says

Eric Holder says

Except this time bonds crashed along with stocks.

Which is why you always hold bonds to maturity.

... or hold stocks until they recover? Nice if you can, nasty if you can't.

I have a bond fund and its purpose is extra monthly income.

So, if the NAV falls (from rising interest rates) I'm not annoyed because I'm holding it forever.

I'm still about 90% stocks.

stereotomy says

Later, as I got older, I started eating 2 meals a day, until now I'm OMAD.

I go at least 18-20 hours each day fasting and feel great. I've been doing this fasting routine for about 4 years now and can't imagine going back to 3 meals a day. I still eat a fair amount of carbs though......chips, pretzels, pizza, IPA's.

The weight loss is great, but fasting also provides so many other health and longevity benefits.

I'd like to try a longer 36+ hour fast sometime this year to get some "autophagy" going!

clambo says

3 million bucks is surely enough for 30-40 years of living off the money, especially assuming social security.
There are funds which pay high dividends so you're not going to deplete your capital.

Dividends suck. If it weren't for dividends I'd qualify for subsidized Obamacare, food stamps, reduced electricity prices, etc. I might even get back 1/10 of what I paid in!

Eric Holder says

... or hold stocks until they recover? Nice if you can, nasty if you can't.

"The market can remain irrational longer than you can remain solvent."

https://qz.com/2169395/all-the-reasons-why-so-many-near-retirees-are-going-back-to-work

All the reasons why so many near-retirees are going back to work

Millions of older Americans retired early, before age 65, during the pandemic, but now, to most economists’ surprise, they’ve boomeranged back into the workforce faster than other age groups.

An estimated 1.5 million of those would-be retirees are back to work according to US Bureau of Labor Statistics data. The workforce participation rate for people aged 55 to 64 has returned to its pre-pandemic level. (People age 65 and older have not returned at the same rate.)

Certainly, older workers have responded to the sudden rebound in demand within the labor market—a rebound that came about because of government stimulus efforts, he continues. But in the chart below, the v-shaped labor force recovery for 55-to 64-year-olds obscures the possibility that, if the pandemic hadn’t happened, there would likely be even more older adults working today, says Davis.

Article fails to mention jab mandates and their affect on the labor market.

if anything work at home such as gig jobs listed at Rat Race Rebellion website ..its a legit site and its been mentioned by mainstream media...

this helps as far as senior citizens looking to earn at least a few hundred dollars per month .. usually they pay around $7 to $10 an hour...

zzyzzx says

Certainly, older workers have responded to the sudden rebound in demand within the labor market—a rebound that came about because of government stimulus efforts, he continues.

Reality - the over 65-year-olds have found they cannot afford to retire now due to high inflation and no more covid payments.

The Spin - the over 65-year-olds are benefiting from a government stimulated economy.

https://www.axios.com/2024/02/19/american-retirement-boom-high-stock-market-returns

Retirements spike again as stock market booms

What's interesting is the obvious early retirement spike right around when the clot shot mandates started.

Money is major concern , between ss + small pension , n investment incomes should be ok as long as I don't live large.

Only need one car then, n Uber if needed.

What kind of hobbies do you guys do to keep busy?.
Tv , only so much u can watch.
Gardening
Helping kids n grandkids
Exercize, walking

.

One thing the retirees can do is work at home such as take surveys

Legit work from home sites have a lot of those type job listings

Check out Rat Race Rebellion and also Work at Home Job Queen

Can earn about $7 an hour at home, and about $15 a day to help pay for bills

I like the gardening mention as you can grow cherry tomatoes easily in pots... I like the cheap fabric pots sold on Amazon ...

Agree about walking, as it should be at least 5 days a week for 1 hour each walking session

.