Hi all,
I just "discovered" this site this past weekend, and have to say it is pretty awesome.
Anyhow, hopefully I can pester you with a couple of newbie questions. I'm on my own path to early retirement (or semi-retirement) and have basically been calculating everything with my own spreadsheet. There are some nice guidelines put forth here, including using the 4% withdrawal rate to reach a savings goal. I'm wondering about a couple of the assumptions that go into this, though:
(1) When coming up with your annual spending target, which the withdrawal rate is based on, are you including taxes?
For example, if I spend $25,000/year but get taxed 10% on the income used for this spending, should I consider my total spending to be $25,000 or $27,500?
(2) It seems like the withdrawal rate throws out any consideration of social security benefits. I know these may not be as generous in the future as they are now, but I expect to get something if I reach 67 or 70 - is this not the case for most?
(3) Is anyone using or considering Substantially Equal Periodic Payments as a means of financing part of early retirement? A 401(k) is my primary savings tool, and this seems like a good way to tap into it before age 59 1/2 without paying a penalty.
Thanks for any comments!
Dave