So many here are recently or are near or are planning for it.

Lets keep it simple as it can become quite complex.

A few simple concepts I like are the following.

The 4% withdrawal rule. Take 4% of your retirement acct every year. Adding 3% a year for inflation of that dollar amount (4%).

Another thing I like is in helping determine how much you need going into retirement is calculate how much money you will need a year to live as you wish in retirement. Multiply that x25 to determine how much you will need to retire. Say if you need $50k a year x 25 years you will need $1.25 million heading into retirement.

Another one is to determine when to take SS. And How much of that is required to meet the above.
Hopefully SS is a smaller part of that equation.
Personally I do not think delaying SS more than 2 or three years serves most people very well, ymmv.

I am not sure how most retiree's view additional assets like real estate and other valuable assets as they navigate through retirement.

What are your guys and gals thoughts. Remember, lets keep it on the simpler side.

Thanks all.

Go into retirement with no or as little debt as possible.

In the spirit of keeping things simple: While "keeping things simple" is generally good advice, the problem with it when dealing with complex issues like retirement financial planning is that it often leads to oversimplification, ignoring crucial details, and ultimately suboptimal or even detrimental outcomes.

So you’ll either end up short of money with plenty of life left to live or you’ve missed out on enjoying life more because you didn’t spend enough. So either have enough money to not have to worry about running out or be poor enough to qualify for government programs. If you’re anywhere in between, you’re going to have to roll your sleeves up and work to get a good handle on your situation because no one is going to care more about your self-interests than you.

Good one Sourdough.

Rey, you missed the intent of the thread. Yes we know it can be complex. And starting with some of the basics and simple concepts can help us all as we navigate and learn more about the process.

The more we learn and educate ourselves without being overwhelmed the more likely we are to succeed.

I agree with the idea of taking social security earlier than "full retirement age". When you run the numbers, the break even point is often around 78-80 years of age. Everyone's situation is different, but I think most of us can make better use of those funds while we're able to fully enjoy them.

I've had an interest in the stock market for many years and I believe in owning solid dividend paying companies. My retirement income includes dividends in my taxable brokerage account as well as dividends from my Roth IRA. Most conventional advisors would not recommend taking from a Roth early, but for me it works well and especially since it's dividends and principle stays.

Having some additional rental income is a nice perk if you don't mind the occasional headache. Of if the situation allows, a rental management company may be worth it.

Employer-sponsored pension amount

Can you live how you want to without the salary you're now making?

Having 2-3 years worth of expenses in cash so you aren't force to sell in a down market. Also have 3 buckets for your assets; pretax, taxable and tax-free

quote:

Retirement planning kept simple

Money out less than money in. And, of course, no debt.

Don't be too much of a mizer in the first half of your retirement. That will be the most enjoyable half of your retirement.

As simple as I can make it is suck it up and find a good Financial Planner to help you.
Every situation is unique and they can fine tune a plan for you.
Ours costs us less than 1% annually and projects about a 10% return. It also includes access to an in house CPA to do our taxes and help us unwind tax protected accounts in the most tax efficient manner possible.

I understand this stuff well enough that I could do it myself. But, I would prefer playing full-time instead.

The best general "advice" I have seen is that 2/3 of your needs in retirement should come from guaranteed sources. Those would be SS, pension or an annuitized annuity (not a withdrawal benefit). The other 1/3 should be portfolio withdrawals.

Your NEEDS not your wants, think groceries, electric, taxes, housing, etc...

YMMV and there are lot of details that need worked out, but get yourself some guaranteed income.

Money is not the most important thing. It is taking care of your health and pursuing things you want to do. It is a big adjustment and if possible it is done gradually.(cutting your work hours}.

No general advice. It depends on your personal financial situation and what you want out of retirement. There are folks that enjoy working and wouldn’t retire even though they easily could.

For me, that "delay taking social security payments" is just so much non-sense in my opinion...start taking it as soon as you retire.

4%? My certified financial advisor, and Edward Jones franchise owner, says 7%. However, I managed close to that 4%.

And I took my Social Security as soon as possible, give me my money now while I’m more likely able to utilize and enjoy it. I did the math and it was gonna take ~12 years to break even.

I have one more major task to do… switch from a conventional will to a trust.
I have three siblings, all three have done that, and two of them are smarter than me so I plan to make it unanimous!

1) Retired means you reached financial independence. You don't need to work in order to eat. Your job now is to maintain that financial independence. You are no longer in the accumulation phase, so change your mindset on your portfolio. No more trading or taking big risks. Keep what you have already accumulated, don't gamble it.

2) Have a plan, and execute the plan. You'll sleep well even when the markets are going down.

3) I agree, take Social Security as early as possible. Invest it if you don't need to spend it. Waiting gets you 8% per year increase in SS payments, and you should be able to get that with conservative investments suitable for retirees.

4) Taxes can become much more complex than pre-retirement. Start learning 10 years before retiring so you are properly configured.

5) Diversify your portfolio! Large, medium, and small cap. Value and growth. I like ETFs because they each include many stocks, which diversifies nicely. See item 1 above, you are protecting what you have, not trying to take risks to generate even more wealth.

6) I like the 5% rule rather than 4%, though up to 7% can be theoretically safe. Take the total value of your portfolio (not including home equity) on the day before you retire and multiply it by 5% (or whatever number you prefer). That is your annual spend from your portfolio. (Including taxes). What you get from SS or pensions is on top of that. e.g. a $1 million portfolio gives $50k per year spend from the portfolio. Increase it each year by the inflation rate. Don't recalculate the 5% each year, just do it the first year and then adjust it by inflation.

7) Guardrails is an excellent concept. If your withdrawals (ie from the 5% rule) become 6% or more of your portfolio (the portfolio has lost significant value), reduce your spend by 10%. If your withdrawals drop to 4% or less of your portfolio (the portfolio has gained significant value), increase your spend by 10%. This lets you increase your spending if the portfolio does quite well, and that's a good thing. If the markets are bad, you reduce your spending by a small amount.

Is the intent to focus on financial aspects?

Or how about (day to day) health / living aspects? For example, assuming that half of 24 hours is spent doing compulsory things (eating, sleeping, chores, etc), it's been conveyed to me to plan your days such that you spend, on the average per day (of the hours left after compulsory activities):
1. 20% doing something physical (about 2 hours/day)
2. 20% doing something mental (about 2 hours per day)
3. 60% doing something enjoyable / social (rest of discretionary time).

So, something like the 40-60 rule for discretionary time: 40% doing something good for mind / body, 60% living life.

Not sure I agree w/ it yet. But pondering it. In any case, the concept seems to have merit. If one can mix 1 and/or 2 w/ 3, all the better perhaps.

quote:

Originally posted by crue-dell:
Having 2-3 years worth of expenses in cash so you aren't force to sell in a down market. Also have 3 buckets for your assets; pretax, taxable and tax-free

Instead of cash, you might consider ladder bonds set to liquidate in the December prior to the year you need them. BAA rated corporate bonds over 3 years have only 2-5% probability of losing value while allowing you to grow with reinvested dividends. Years 1 and 2 are fully funded in ladder bonds and years 3 onwards start at 80% funding going down by 20% each year until it drops to 0%.

This quarter’s funds are in high yield accounts and the rest of the year is in XBIL, a six month treasury etf.

Here’s a link to iBonds etf where you can choose from corporate, high yield, treasuries, or munis.

iBonds

Rey, if I keep money in a 401k bond fund, is that enough? Or are you suggesting an additional cash/fund outside of 401k?