Author Topic: How you calculate your FIRE date?  (Read 1382 times)

haschen

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How you calculate your FIRE date?
« on: November 16, 2016, 07:41:27 PM »
Hi,

I've been reading this forum for some time now. And since that I've put togethere the spreadsheet with all our asstes (they are spread over between 3 countries, so it was  a lot of fun)
Now, I'm trying to understand how most of the ppl calculate their FIRE date?
Do you take into account just your cash/investment sevings? Should I add the 401/other retirement plan savings, even if I can not access them in next 20-30 years? Also, do you take into account the property value etc..

I understand 4% rule, but I'm wondering what that should applied to.

Thanks for you help and explanation!
« Last Edit: November 17, 2016, 06:05:09 AM by haschen »

marty998

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Re: How you calculate your FIER date?
« Reply #1 on: November 17, 2016, 12:16:22 AM »
I picked a date in the future that I no longer want to be working full time beyond.

Whether I actually have enough to be FIRE is a whole 'nother matter!

rpr

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Re: How you calculate your FIER date?
« Reply #2 on: November 17, 2016, 12:38:34 AM »

Do you take into account just your cash/investment sevings? Should I add the 401/other retirement plan savings, even if I can not access them in next 20-30 years?
Yes, take into account retirement accounts such as 401k, IRAs etc. All those can be accessed in ER via many different ways such as Roth Ladder etc.
Quote
Also, do you take into account the property value etc..
Are you talking about primary residence or rental property? A fully paid off rental can produce an income stream that you can use. Take into account the primary residence property value only if you plan to sell and move when in ER. If moving then you will need to consider the new housing costs in ER. To keep things simple, I would leave out primary residence property value.

Linea_Norway

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Re: How you calculate your FIER date?
« Reply #3 on: November 17, 2016, 01:31:31 AM »
I have understood that 4% is a conservative guess of how much you can make yearly with money in a fund (preferably an index fund with cheap costs).
That way you should be able to take out 4% yearly, without your money declining.

My DH and I have been trying to calculate how much we will get in pension from the state and our pension funds, from the age of 67. It turned out that what we will get, is already enough to live off after 67, even if we would stop working today.
So now we just need to cover the period from 50 to 67 years: 17 years. We guess we need 400.000 NOK per year for a living, so we need 17X400.000 = almost 7.000.000 NOK, roughly 1 Mil USD, in spendable money. And a mortgage free place to live.

Dicey

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Re: How you calculate your FIER date?
« Reply #4 on: November 17, 2016, 03:02:10 AM »
What is FIER?

Linea_Norway

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Re: How you calculate your FIER date?
« Reply #5 on: November 17, 2016, 03:04:23 AM »
What is FIER?

Financially Independent Early Retirement

Oh, it's probably wrong and should have been FIRE:

Financial Independence Retire Early

Dicey

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Re: How you calculate your FIER date?
« Reply #6 on: November 17, 2016, 03:35:04 AM »
At the risk of being a total snatk-ass, I do know what it means. But given where we are, this typo is pretty egregious, IMO.

haschen

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Re: How you calculate your FIER date?
« Reply #7 on: November 17, 2016, 06:11:25 AM »
Yes, take into account retirement accounts such as 401k, IRAs etc. All those can be accessed in ER via many different ways such as Roth Ladder etc.
Are you talking about primary residence or rental property? A fully paid off rental can produce an income stream that you can use. Take into account the primary residence property value only if you plan to sell and move when in ER. If moving then you will need to consider the new housing costs in ER. To keep things simple, I would leave out primary residence property value.

I'm not american citizen, I'm here on a working visa, so I'm not sure that I will be able to access 401 earlier (in the same way as would americans).
But I think we can just pay the taxes and take our money out of it, if/when we leave the company  and USA. Not sure if that's true though.

I guess I had this question after reading multiple posts about ppl saving 500/750k/1m... And I was not sure what they include in that number.

Thanks for answers guys, I will be mainly focusing on counting the the investments accounts.. All other assets will be just nice addition in the end..
cheers