What's your ERE goal amount?

Where are you and where are you going?
irukandjisting
Posts: 90
Joined: Sun Jun 10, 2012 12:58 pm

Post by irukandjisting »

Going around this quite different to most - as being female, single mum to a large family, and now in my 50's
I will be living on the term deposit interest money from my house sale next year - proceeds have to be divided, but interest rates around in the 5-6 percent on terms
Pensions in Australia for women start at 67 years of age so I will be self funding for some time
I hope to work 1 day a week, if any - and can up this if need be


GPMagnus
Posts: 116
Joined: Tue Jun 05, 2012 2:24 pm

Post by GPMagnus »

This is a fascinating thread that has really gotten me thinking. What is interesting to me is that most people here have some number or SWR rate based mostly on current consumption / status (i.e. children/childless or in the US / developing country). Also, most people do not assume any active income once retired ... What is less common are people trying to actively reduce expenses like bigato, MikeBOS or Jacob or actively gaining skills to enable them to reduce their consumption.
My main takeaways are that I need to know the following before doing the math:
1. How many people will the funds be supporting? Will there be any extra income ? Do these people have specific risks that can be diversified away with insurance?
2. What will be my true expense level given my skills, access to land/resources and my location?
If anyone wants to ping-pong and help me build up this question list - I'd love for it to happen!
Magnus


secretwealth
Posts: 1948
Joined: Mon Jun 27, 2011 3:31 am

Post by secretwealth »

"What is less common are people trying to actively reduce expenses like bigato, MikeBOS or Jacob or actively gaining skills to enable them to reduce their consumption."
I'm very guilty of this--I've cut down my housing expenses but that's about it. I am comfortable with my lifestyle and expenditure level, but it is very inefficient. Plus, I use the marketplace to satisfy many needs that could be satisfied with my own two hands. For example, I don't make my own furniture.
Still, my interests and lifestyle will change. I imagine in my 60s and 70s I will spend less time out of the house, and thus less time spending money. I don't think I will want to travel in my old age, and I definitely will want to leave NYC, which will be a tremendous savings for obvious reasons.
So, a question I'd add to your list, Magnus, is:
3. How will my expense level change in the future due to a changing lifestyle?


GPMagnus
Posts: 116
Joined: Tue Jun 05, 2012 2:24 pm

Post by GPMagnus »

@ secretwealth
Its a great point Secret :) I think its a subset of question 2 on my list and I thought about it vaguely when writing the post, but for some reason - likely the same as most people - an inability to imagine another lifestyle while not living it - I did not include it.
I think it also begs the question (which likely deserves a separate discussion) - how can we experience our "ideal" ERE lifestyles before we get there financially? This is critical and akin to dating .... think about imagining a spouse ... I am confident most of us ended up with SOs who were/are quite different from what we imagined when we were only beginning to date


before45
Posts: 80
Joined: Thu Mar 15, 2012 2:59 pm

Post by before45 »

FI to me means earning $20k from investments, and I'm comfortable using a 4%SWR. So $500k is my goal. I'm actually spending more like $18k a year right now, and I'm not against working a little at stuff I'd like in FI, but I'm not confident that getting paid side jobs is as easy for me as it seems to be for some. So I'm padding the budget a little with that $500k. That said, I should hit it within the next 2 years (and live up to my username, barely!). Whether I have the huevos to actually quit my job then, we'll see. I'll likely be asking this forum for a lot of virtual hand-holding to make that move. . . .


Phayen
Posts: 94
Joined: Wed Jul 27, 2011 8:25 pm

Post by Phayen »

Married, 2 kids, renting now.
$1.0M to $1.4M. I'm not really sure how much we'll need in retirement. I already don't spend much for work, so I'm guessing flat. Also, not sure how much teenagers will cost. (Probably not much if they live the same way I did growing up). So that range is pretty fitting. This is assuming 4% SWR. It'll probably happen at age 45 for me. Which is by far earlier than every single person I've met in RL.


JohnnyH
Posts: 2005
Joined: Thu Jul 22, 2010 6:00 pm
Location: Rockies

Post by JohnnyH »

I'd be really curious if there was a correlation with age (and kids, maybe) on these numbers.
Maybe an age, location, ERE goal amount survey?


Phayen
Posts: 94
Joined: Wed Jul 27, 2011 8:25 pm

Post by Phayen »

I think location (ideal retirement location) can have a significant impact. Mine is assuming Southern California. I could cut out $200-$300K by moving to Dallas. But I think its worth it.


JohnnyH
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Joined: Thu Jul 22, 2010 6:00 pm
Location: Rockies

Post by JohnnyH »

I've always been so puzzled by people who are willing to work an extra 5 years + just to stay in CA/NY... There are countless great places in the US, where you can live and house yourself for a fraction of the cost.
I suppose friends, family and general locational inertia could be a significant factor, however.


tylerrr
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Joined: Tue Dec 13, 2011 3:32 am
Location: Boston

Post by tylerrr »

i find it funny some of you are saying you need close to 1 million to retire.
That is not ERE at all in my opinion. You're missing the whole point.


George the original one
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Post by George the original one »

@tylerrr - Typically the million dollar figures are for 2 or more people.


dragoncar
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Post by dragoncar »

I don't think you really need an extra 5 years to stay in CA. Jacob's expenses didn't change between CA and IL.


tylerrr
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Location: Boston

Post by tylerrr »

@George the original one,
still seems high to me, but everyone is different I guess.


frugal
Posts: 72
Joined: Thu Sep 06, 2012 11:35 pm

Post by frugal »

Married , 1 child
Goal:

Get to 300k at 4% profit which is €12.000 euros a year. I'll keep my monthly budget down below €1k a month.
I would like to work part time 3-4 hours per day.
Problem: the child has to grow with lot of expenses


noskich
Posts: 91
Joined: Mon Oct 31, 2011 9:34 am

Post by noskich »

Initially 400K AUD which would enable relocation to a more relaxing environment and a more enjoyable job, maybe even part-time.

From then on I would not really care about the number as long as I manage to cover the expenses and increase the amount above the inflation rate.


Spartan_Warrior
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Joined: Fri Dec 02, 2011 1:24 am

Post by Spartan_Warrior »

$250,000 and a paid off house. (Value of house means little for my plans, but it should be worth about another 200-250k for a total net worth of 450-500k.) I'll be withdrawing about $1,200/mo. My entire retirement goal is based around freeing up time for me to write, so I'm also assuming a side income here. I'm still working on lowering my monthly expenses as well which should also allow a slightly safer SWR. Finally, I should be eligible for a tiny pension at some point in my 50's.


frugal
Posts: 72
Joined: Thu Sep 06, 2012 11:35 pm

Re: What's your ERE goal amount?

Post by frugal »

hi friends

any post to speak about the investment portfolio or how to get profit of cash?

Regards!

Jason

Re: What's your ERE goal amount?

Post by Jason »

500K and a paid off house and I might say fuck it. 750K and a paid off house, you best believe I will say fuck it.

I

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fiby41
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Re: What's your ERE goal amount?

Post by fiby41 »

Minimum requirement: 36 lakh
Under ideal conditions: 48 lakh

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