Many valid points by the bogleheads. MMM's optimism is great for drawing people into the lifestyle, but it isn't the most realistic on many of the finer points, which the bogleheads did a good job of highlighting.
Even though I disagree with MMM on many of the fine details, it doesn't detract from the message at all. (Unless anyone here is drinking the Kool-Aid.)
Curious @Boofinator - what aspects of MMM do you find unrealistic and where do you disagree?
I certainly have my own opinions (MMM's rush to pay off mortgages, plus his overly rosy rental assumptions are two examples).
I agree with the general tenets. That's why I'm here. But let's pick through the article:
1) MMM puts his stake in the ground (or draws a line in the sand), saying its absolutely possible to make a chunk of money last a lifetime with no side hustles. I agree.
2) But then he quotes living off $40k, which was his starting amount (if subtracting home equity) ten plus years ago. Not that it isn't possible to be happy on this amount, but few are as frugal as MMM.
3) Then he gives three success scenarios, starting with being probably able to make it with 5%. Well, if the premise is you're guaranteeing no side hustle, though you could cut your expenses to something lower than what MMM was spending ten years ago given the fairly decent chance you run out of money, I don't think that is a recipe for success.
4) MMM uses a constant rate of return for stocks in his calculations. Since this has never actually happened, I don't consider it a good lynchpin for your retirement spending.
5) MMM says to get the big picture right and not sweat the small stuff, but neglects to mention his experience with sequence of returns, specifically the house business. He certainly wasn't comfortable with the giant losses in his business at the time owing to the housing market downturn. Now, of course, everything is small stuff for him.
6) He recommends not investing in bonds. When you are that close to the line of making it / not making it from an historical perspective, bonds (at the beginning of retirement) can decrease the sequence of returns risk.
7) He says that should the stock market crash, within a year or two, the market is back up. Try 16 years for the Great Depression, or 11 years with the DotCom bust. (And these are not inflation-adjusted; if you consider those dips, we have historically seen decades-long dips).
8) He says you can cut your lifestyle if needed below $40k per year. Not sure this comes with the happiness proposed.
9) What happens should an adverse life event bump up the cost of living to $50k per year?
10) To round it out to an even ten, he only considers historical U.S. returns. Past performance yada yada.
To conclude, a chunk of money is a perfectly good retirement plan. But if one were to go solely based off that article they could become very disillusioned with Mustachianism (or perhaps they'll get lucky).
My take: 5% is probably a good figure if you have side hustles planned (such as he did) or if you're FatFIRE and truly have plenty of fat to cut. If you don't have side hustles planned and plan on living on $40k in the U.S., you should probably be much more conservative in your planning (unless you truly don't mind living like a pauper for a few years; easier said than done).