Ask 0bama to give you some from his stash.
It's never empty.
Posted on 03/28/2011 12:14:28 PM PDT by SeekAndFind
In recent years, it has become a rule of thumb that many retirees can safely withdraw 4% or 5% a year from their investments and feel confident about their chances of having their savings last the rest of their lives.With the low, low returns in most grayhair investment vehicles, using part of the capital to supplement the Social Security and/or pension benefits is not a bad idea -- assuming that this 4% figure is understood to mean, exhausting the entire nestegg in 25 years.
Somerset Maugham wrote short story about two Englishmen in Tahiti who retired. One took his money in a lifetime pension, the other took his as a lump sum, declaring that if he ran out of money, he would shoot himself. He did run out of money, but did not commit suicide. He ended up begging from the natives -- you can imagine the shame for a Englishman of that era to do that....
Your big risk is if your stocks go down significantly. You can lose more of the principal in one year than you make in 5 years in dividends. And make that 5yrs in 8 years, because dividends are taxed as you get them, while capital losses offset income up to only $3000 a year.
Welcome to Walmart, just getting ready.
Don’t feel alone. Every time I’ve tried to retire, I seem to get a large tax bill for the previous year which takes a large chunk out of the retirement kitty.
If stocks go down, and the dividends are still being paid, why sell? You still own the same slice of the same companies, and if you think they are solid companies, don’t sell them.
The rational thing to do is buy additional shares, and get an 6-7% dividend. I only wish I had done more of that.
Actually, it doesn’t mean exhausting it in 25 years. It lasts longer than that because of the declining principal: for example, when the principal is down to half its original value, the 4% is now only 2% of the original principal.
That’s true if the dividend isn’t cut, but in serious downturns they often are.
If rates are, say, 4%, the money will never run out. But it’s hard to find rates that high, other than natural gas concessions (which also have the depreciation offset, IOW a tax shelter).
Between inflation and the government’s growing willingness to use dictatorial methods, I’ve just about given up on having a normal retirement (and I’m only in my twenties).
Hell, with the way things are going, some ambitious Hitler wannabe senator will probably start pushing for the government having the final say on when you can retire. Considering how many suckers believe a person has a duty to work and provide for his fellow man with nothing in return, I no longer consider such actions impossible in America.
That is the real question. You’d need a million dollars if you wanted to take 5% a year and make $50,000 a year.
But if you were 80, and started taking $50,000 a year out of your million dollars, even if you made no money, it would take 20 years to spend down the principle — which means you’d be 100.
Sometimes I wonder why I am saving so much money, when I could spend it now and enjoy myself.
I live quite modestly, and what ticks me off is that the government demands I take out more from my IRA than I need to live on.....No mortgage, 10 year old car, don’t need to buy new furniture every 5 years, have enough clothes to last longer than my life expectency, its none of their business how much I take out, but they make the rules. Who ever made these laws should be tar and feathered..
My mom (92.5 now) is the same. I gave up trying to keep her from saving her used tin foil that she’ll wash, dry and fold. And then neatly stashed away - either in her winter home or her summer home.
“What nest egg?”
You better start saving. The dollar has declined 14% since last June:
And the dollar will continue to decline.
Ok. I am simi retired(but 65) to take care of my dieing mom. It doesnt take much to figure out that what I thought would be enough will not be. the dollar is getting more worthless everyday and there really isnt anywhere to put your cash to keep it growing.
I currently have quite a bit invested in precious metals: lead, brass — that sort of thing.
Am so sorry about hearing about your mom.
Please forgive me for anything construed as being insensitive.
You have plenty of problems without irritating people like me talking.
You did not retire because you could, you retired because you had to. Big diff.
Good idea. We need to be prepared for anything that may happen, as best as we can.
I’m glad I stocked up on the more expensive canned goods, and bought some gold when it was low.
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