Author Topic: Scared to death of retiring with 2.65M in assets  (Read 5415 times)

johnny847

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Scared to death of retiring with 2.65M in assets
« on: January 12, 2015, 07:59:08 AM »
A case study on the Go Curry Cracker blog (great blog btw): http://www.gocurrycracker.com/reader-financial-review-scared-death-early-retirement/
Not only do they have 2.65M in assets, but they could have a 0% withdrawal rate, because a pension and SS would provide $4300/mo = $51.6k a year.

And somehow they're panicking about retiring????

Le Barbu

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Re: Scared to death of retiring with 2.65M in assets
« Reply #1 on: January 12, 2015, 08:09:38 AM »
He is 57 and she is 54, what kind of ER are they talking about?

Probably the biggest problem is to think that kind of shit, lets get outside the box a bit!

ER is at least 50 or less, 40 something is normal and before 30 is better.

+1 for their NW doh!
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slugline

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Re: Scared to death of retiring with 2.65M in assets
« Reply #2 on: January 12, 2015, 09:27:55 AM »
I wonder if the true concern with this case study has nothing to do with the numbers. Maybe, deep down, this couple is unsure of what they will actually do in their post-retirement phase.

RFAAOATB

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Re: Scared to death of retiring with 2.65M in assets
« Reply #3 on: January 12, 2015, 11:37:12 AM »
I wonder if the true concern with this case study has nothing to do with the numbers. Maybe, deep down, this couple is unsure of what they will actually do in their post-retirement phase.

They said they had no children, perhaps a later in life adoption for an heir.

James

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Re: Scared to death of retiring with 2.65M in assets
« Reply #4 on: January 12, 2015, 11:45:22 AM »
What a waste, waiting that long to retire with all those assets. They could have retired years ago and been doing what they want, travel and winters in Florida. Imagine the regret if one of them develops health issues shortly after retiring...
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Rezdent

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Re: Scared to death of retiring with 2.65M in assets
« Reply #5 on: January 12, 2015, 11:46:22 AM »
I think the key is the fear; it could be rational or not.  Possibly the same fear allowed them to accumulate the stache in the first place.

nereo

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Re: Scared to death of retiring with 2.65M in assets
« Reply #6 on: January 12, 2015, 12:07:34 PM »
It's fear, plain and simple.  Regardless of all the fireCalc simulations, pensions, SS, etc. some people are so afraid of going to $0 earned income that they perpetually delay.  I remember a similar conversation I had one someone on this forum who (if I remember correctly) had annual expenses of under $40k, a mostly-equity portfolio around $1.6M (already a 2.4% WR), a paid-off home he planned to downsize, and substantial cash flow from a pension and (later) SS.  Yet he kept talking about one-more-year 'just to be safe'. 

slugline may be right - deep down the poster may just not know what to do in ER.

also, while 54 might not seem 'early' to those of us on this blog, it's a good decade earlier than the typical worker in almost every country on earth.  So sure, I personally count anything before 59.5 as "early" - but that's just me.
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johnny847

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Re: Scared to death of retiring with 2.65M in assets
« Reply #7 on: January 12, 2015, 04:52:30 PM »
Agreed - even if they don't consciously realize it, I'm sure some of their skepticism to retiring comes from the stability of a paycheck, and fear of what to do in retirement.

But damn, as others have stated, what a waste! I mean seriously, their problem once they finally "make the leap" and retire is deciding what to do with all that money. Because with a 0% withdrawal rate, that portfolio is going to grow to a huge sum by the time they pass. I suppose they could waste money on random crap, but depending on their personality, even that can get boring.

Jeremy

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Re: Scared to death of retiring with 2.65M in assets
« Reply #8 on: January 12, 2015, 08:39:04 PM »
Come on guys, I thought this section of the forum was for people that live beyond their means and other such ridiculousness

They have done well for themselves, saving and investing, and laying a foundation for traveling through their retirement years

They are a decade ahead of many of their peers, and are putting themselves out there to ask for help.  That takes a lot of courage

Bob is responding to comments on the Reader Review.  If you have questions about their fears or retirement goals, or just want to share some encouragement, I'm sure he would be happy to respond

innerscorecard

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Re: Scared to death of retiring with 2.65M in assets
« Reply #9 on: January 13, 2015, 01:31:44 AM »
The interesting thing is that most financially "responsible" people in our society are like that. They've done well for themselves by following the rules. But the rules don't provide for retiring early.
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nereo

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Re: Scared to death of retiring with 2.65M in assets
« Reply #10 on: January 13, 2015, 09:09:11 AM »
Come on guys, I thought this section of the forum was for people that live beyond their means and other such ridiculousness

They have done well for themselves, saving and investing, and laying a foundation for traveling through their retirement years

They are a decade ahead of many of their peers, and are putting themselves out there to ask for help.  That takes a lot of courage
Point taken.  Thanks for the reminder Jeremy.  I'll admit I'm envious that they've reached FI several times over - I just hope I don't hold myself back when the time comes for me.  They deserve at least a hand clap for their actions thus far.
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Bob W

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Re: Scared to death of retiring with 2.65M in assets
« Reply #11 on: January 13, 2015, 09:44:44 AM »
Old habit are hard to change.  If they semi enjoy their jobs I would be all for them working until they die and then passing their assets onto someone deserving. 
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Re: Scared to death of retiring with 2.65M in assets
« Reply #12 on: January 13, 2015, 10:17:58 AM »
When I first read this I said to myself are you kidding me. Then I realized that it's all relative. $2.65 million would seem like a lot for most of the population out there but not for everybody (there're too hung up on taxes). I think of my own situation where some of my siblings would retire if they had my stash, but to me it's not enough.

Jeremy

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Re: Scared to death of retiring with 2.65M in assets
« Reply #13 on: January 13, 2015, 07:02:16 PM »
When I first read this I said to myself are you kidding me. Then I realized that it's all relative. $2.65 million would seem like a lot for most of the population out there but not for everybody (there're too hung up on taxes). I think of my own situation where some of my siblings would retire if they had my stash, but to me it's not enough.

Plus if you've always been thinking that you need to work until you vest for your pension and health benefits, and don't obsessively check your portfolio value or read early retirement blogs all the time, compound interest can just sneak up on you like that


PS:  I know Bob would appreciate it if a few more people would share some words of encouragement in the comments.  Jim Collins of jlcollinsnh.com fame just shared some thoughts as well