> The 4% rule doesn't exist
I figure I would try to stick to 3% or around $3000 / month, which seems reasonable. Later in life I could increase to 4% if investments hold up.
I might be able to stay at 2% if I stay extra frugal or have the supplement income.
The 4% rule seems to be covered alot elsewhere:
http://www.mrmoneymustache.com/2012/05/29/how-much-do-i-need-for-retirement/As a backup plan, I would like to find some part-time freelance work online - -maybe web design, blog setup, research, data analysis, SEO, open source software, or some other small project .
Has anyone tried elance?
I also thought about part-year or seasonal work.
As far as taxes, at least 1/3 of my savings are tax deferred or non-taxable. This includes IRA, savings bonds, and muni bonds. The stock dividends, other dividends, and capital gains are now taxed at a low rate if one's income is low. It's also possible to reset the cost basis of some shares each year while taxes are low.
It is true that taxes could increase in the future and decrease one's returns, but this is one of many investments risks. But it's also possible taxes on investment income remain favorable for the near future.
Life expectancy, investment returns relative to inflation and taxes, and one's personal future cost of living are all unpredictable. My opinion is that the MMM philosophy is one makes reasonable assumptions and has a backup plans -- good health, activities that turn into income, etc.
I think the overall question is do I optimize for financial gain or happiness? If I'm not happy at the job and have some solid saving, my thinking is I should go now (or sooner).
I think that fear of the worst case scenario can hold myself and others back. But the cost of not taking action is the best case scenario doesn't happen either.