Retirement Savings -- Countup

[Randomsaver]

Apr 2021

401K Retirement Savings: $ 116K
IRA Retirement Savings $ 27K
Non-Retirement Account Retirement Savings: $ 296K

[Randomsaver]

There's a big thread on the ER site about how much people's portfolios have grown since they retired. For some it is by 7-figure amounts.

We all agonize about hitting our number and hoping it lasts. The reality is that as long as the market does reasonably well most years, your portfolio may well continue to grow despite your draw down. Of course, it could go the other way too, but statistically, the market is up more than it's down.

I wish my batch will have our own Trump-like president by the time we retire. Someone who could also double our money in 1 term.

[disneysteve]

I wish my batch will have our own Trump-like president by the time we retire. Someone who could also double our money in 1 term.

[Scallywag]

There's a big thread on the ER site about how much people's portfolios have grown since they retired. For some it is by 7-figure amounts.

We all agonize about hitting our number and hoping it lasts. The reality is that as long as the market does reasonably well most years, your portfolio may well continue to grow despite your draw down. Of course, it could go the other way too, but statistically, the market is up more than it's down.

What's ER site? Early Retirement?

BTW, what rate of return are you assuming for the next 10 years, Steve? I am assuming 7% (5% after inflation) in hopes it will make us hit our retirement figure of 3M (1M + SS beginning when DH turns 70) for us to live off of from ages 65 to 85/90) and the rest 2M for our son. Between ages 65 to 70, we hope to live off of accumulated cash savings, and then begin spending from our 1M nest egg and SS.

I just feel nervous / worried about this not working out... like SS not being there etc, or we developing health complications that drain our nest egg leaving our son destitute etc or that the market will simply not return 7% as we hope / expect it to for the next 15 - 20 years.

UGH.

[disneysteve]

Sorry about the abbreviation. Yes, ER was referring to early-retirement.org. That is a great forum filled with people preparing for retirement and many who are already retired sharing their knowledge and experiences.

I’m being very conservative in my planning. I’m using 5% for stocks, 2% for bonds, and 0.5% for cash. With an allocation of 60/30/10 that gives us a blended return of 3.65%. If we can have a withdrawal rate of 4% or less, we will be set for life. SS will be on top of that.

Our plan is similar to yours. Cash at first along with income thrown off by our taxable investments for the first few years. Then moving onto the retirement plans and SS.

[Scallywag]

Sorry about the abbreviation. Yes, ER was referring to early-retirement.org. That is a great forum filled with people preparing for retirement and many who are already retired sharing their knowledge and experiences.

I’m being very conservative in my planning. I’m using 5% for stocks, 2% for bonds, and 0.5% for cash. With an allocation of 60/30/10 that gives us a blended return of 3.65%. If we can have a withdrawal rate of 4% or less, we will be set for life. SS will be on top of that.

Our plan is similar to yours. Cash at first along with income thrown off by our taxable investments for the first few years. Then moving onto the retirement plans and SS.

You don't worry about SS "drying up"?

if I were as conservative as you and assumed a 3.5% ROR over the next 15 years, we wouldn't meet our financial goals at all. If SS ceases to exist then we're 200% screwed.

[disneysteve]

You don't worry about SS "drying up"?

if I were as conservative as you and assumed a 3.5% ROR over the next 15 years, we wouldn't meet our financial goals at all. If SS ceases to exist then we're 200% screwed.

I'm not concerned about SS going away. Maybe benefits will get trimmed but I doubt they'd do it to people already collecting or close to it.

I'm projecting that we will have upwards of $2.5M by next year. If we need 100K/yr, that's 25 years worth of money with no return (not accounting for inflation though). Add in SS taken at whatever age and even a 3.5-4.0% return on our money and we'll be just fine. And realistically, I expect the equity portion to do better than 5% but better to underestimate. I think 6 or 7% is reasonable.

[LivingAlmostLarge]

You don't worry about SS "drying up"?

if I were as conservative as you and assumed a 3.5% ROR over the next 15 years, we wouldn't meet our financial goals at all. If SS ceases to exist then we're 200% screwed.

So I'm 41 and I don't think SS will be gone by the time I'm 70. Benefits trimmed? For sure. Maybe it'll turn means based but I don't think see how they will be able to take it away from people who are a ta lower income. I suspect that they will increase FRA? Maybe do away with 62? Small incremental changes.

[disneysteve]

I suspect that they will increase FRA?

What does FRA even mean really? You can collect anywhere from 62 to 70. My FRA is 67 but there's nothing special or different that happens if I collect at that age. I get more than at 66 but less than at 68. Why even bother calling a particular age FRA?

[Scallywag]

So I'm 41 and I don't think SS will be gone by the time I'm 70. Benefits trimmed? For sure. Maybe it'll turn means based but I don't think see how they will be able to take it away from people who are a ta lower income. I suspect that they will increase FRA? Maybe do away with 62? Small incremental changes.

If it's means tested and still around by the time we can collect, then my family will DEFINITELY qualify. I'm not losing any breaths over SS, tbh.

I really have a nagging feeling that it might just all dry up by the time it's our turn to get back what we paid into the system. When I said we are 200% screwed, I was really referring to my poor son who may really need that money for his lifetime expenses. If my son was neuro typical, then I wouldn't even be THINKING of factoring SS into our nest egg equation - I'd just assume it won't be there by the time we turn 68 or whatever the FRA will be when we enter our 60s.

What does FRA even mean really? You can collect anywhere from 62 to 70. My FRA is 67 but there's nothing special or different that happens if I collect at that age. I get more than at 66 but less than at 68. Why even bother calling a particular age FRA?

How on Earth does that work that you get MORE at a younger age than at an older age?

IF SS is still around at the time, then we're hoping to stall collecting until DH turns 70 and then get DS collecting SSDI on his father's record. I don't qualify for SS on my own because I don't have enough credits from my working life, unfortunately.

And, of course, I know we can't control a thing from beyond the grave, but I do fear that if SS hasn't run out by the time DH turns 70, then it may just be a matter of time and the trust may eventually run out of money when my DS is still alive and needing that check every month.

I just hope my son never outlives the nest egg we leave him. I don't think SS will outlive DS, though.

[disneysteve]

How on Earth does that work that you get MORE at a younger age than at an older age?

I think you misread that. I said I'd get more at 67 than at 66 but less than at 68. It's a continuum with the benefit increasing every year from 62 to 70. There isn't anything special about 67 so I don't know why they call that my FRA. The designation is meaningless.

[Like2Plan]

What does FRA even mean really? You can collect anywhere from 62 to 70. My FRA is 67 but there's nothing special or different that happens if I collect at that age. I get more than at 66 but less than at 68. Why even bother calling a particular age FRA?

One difference I can think of--is if you still choose to work after FRA, no more earnings test for your SS benefits.

https://www.ssa.gov/oact/cola/rtea.html

[disneysteve]

One difference I can think of--is if you still choose to work after FRA, no more earnings test for your SS benefits.

https://www.ssa.gov/oact/cola/rtea.html

Thanks. That's certainly meaningful. So FRA does stand for something. I figured it must. I just didn't know what.

[Randomsaver]

Oh no it's going the wrong direction.

Jun 2021

401K Retirement Savings: $ 119K
IRA Retirement Savings $ 25K
Non-Retirement Account Retirement Savings: $ 289K

[LivingAlmostLarge]

Oh no it's going the wrong direction.

Jun 2021

401K Retirement Savings: $ 119K
IRA Retirement Savings $ 25K
Non-Retirement Account Retirement Savings: $ 289K

This is part of investing in the stock market. Up and down.