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General Discussion => Welcome and General Discussion => Topic started by: retireatbirth on December 04, 2017, 05:25:36 PM

Title: Required rates of return for CoastFI
Post by: retireatbirth on December 04, 2017, 05:25:36 PM
Had some fun at work today playing around with the formula determining the required return you'd need to early FIRE.

Simple algebra on this formula taking age and % FIRE as variables gave a pretty cool grid which I've attached. Hope it is useful to someone.

(Current Value) * (1 + Rate) ^ (Years until 59.5) = FIRE Value

Basically find your age and % FIRE (dollar amount) and it'll tell you the rate of return you'll need for it to grow to full FIRE by age 59.5 if left untouched. So go off and work a fun job while your money works hard for you. All that green is any rate below 6% (inflation-adjusted).

Caution: Grid is dangerous to anyone under 35. Supervision required.
Title: Re: Required rates of return for CoastFI
Post by: FIRE Artist on December 04, 2017, 09:11:56 PM
I am familiar with this concept as I am essentially coasting to FIRE right now since I downshifted my career. 

This graph would be much more useful if instead of age you used years to desired FIRE date, this way it could be used for any retirement age, not limited to 59.5

Title: Re: Required rates of return for CoastFI
Post by: retireatbirth on December 05, 2017, 06:01:42 AM
I am familiar with this concept as I am essentially coasting to FIRE right now since I downshifted my career. 

This graph would be much more useful if instead of age you used years to desired FIRE date, this way it could be used for any retirement age, not limited to 59.5

Argh, I originally had it that way. Not sure what I was thinking...
Title: Re: Required rates of return for CoastFI
Post by: HawkeyeNFO on December 05, 2017, 08:14:13 AM
Worthless.  Nobody wants to work until 59.5.
Title: Re: Required rates of return for CoastFI
Post by: exige on December 05, 2017, 03:08:11 PM
8.7% this is unacceptable