What's your ERE goal amount?

beav80 · Post by **beav80** » Tue Aug 23, 2011 12:47 pm

I'm just starting out, going to have a child, and going to finish off a PhD. It seems like I should aim high, more like $600k but I am just getting started on this though I take these ideas to heart. Thanks for this, it's very helpful.

sree · Post by **sree** » Tue Aug 23, 2011 4:36 pm

My goal is 750k invested, which I should be able to achieve in about 6-8 months. Also I already have 240k put in a paid off condo, which I might get 220k if I sold it. Current expenses are about $20,000 per year, which would be about a 3% withdrawal rate from the 750k.

LiquidSapphire · Post by **LiquidSapphire** » Wed Aug 24, 2011 5:03 pm

Really enjoyed this thread. I have been focusing on trying to reduce expenses so as to get this number as low as realistically possible. Based on a future, pretty tight budget, I calculated 482,758 which would entail a 4% SWR. That number includes purchasing property for 100,000 or less, a $40,000 lifetime budget for travel and paying off my debt (roughly $32,000). I am about 35% of the way to this figure. I might quit sooner though, I don't think working part time to make a little extra fun money and to make that travel money over time would be so bad.

palmera · Post by **palmera** » Tue Aug 30, 2011 11:03 pm

My goal is semi-retirement with $250k + a property that's mostly paying itself off (mortgage free in 10 years) in 3.5 years.
After that I plan on working on a casual/part-time basis, or running my own little business.

TheWanderingScholar · Tue Aug 30, 2011 11:17 pm

Goal: Get to 300k at 4% dividend stock which is $12000 dollars a years. I'll keep my monthly budget down below $1k a month by moving to the Philippines if need be.
After that, run a small business with low maintenance cost, and/or work part time.

pooablo · Post by **pooablo** » Sun Sep 18, 2011 7:14 am

It's great to see all these different range of numbers. My father and I live together now after he divorced his second wife. I enjoy my father's company and it saves me a lot of money as I no longer need to pay for rent.
My goal is between $500,000 to $750,000 in financial assets including stocks, bonds, cash, and real estate. I am hoping to hit that range between 35 to 40.
After I hit my goal, I'll probably teach yoga, work at a vegan restaurant, and maybe lifeguard for fun. I may even work as a tax preparer during the tax season as I actually enjoying doing tax returns!

arebelspy · Post by **arebelspy** » Mon Sep 19, 2011 2:29 am

I'd be really interested in reading more about the article user "learning" posted about in this thread two months ago, saying:
"I read somewhere a contrarian view about using debt leverage, though. The argument was that it is actually faster to accumulate assets by waiting and paying full price using income from existing assets than paying the interest on the loans (disregarding taking advantage of down markets)."
Anyone have any more information on this?

NYC ERE · Post by **NYC ERE** » Mon Sep 19, 2011 2:37 am

$250k -- 45k for land/house, 205k for investing. i am maybe starry-eyed in my expectation of 8% real returns, but this is my hope, and i'm willing to manage rental properties for some time to get it.
i'm getting an itch to really learn building, though, so might build some spec houses as my first post-ERE "mini-career," which, depending on its success, could supply more capital. i'd prefer to use whatever additional capital comes in to lower my investment risk.
btw i love the idea of being able to live on even less than $1,100/mo. by growing my own food, etc., re: Jacob and MikeBOS.

Post by **jacob** » Mon Sep 19, 2011 3:01 am

@arebelspy - Leverage works if you can grow the capital faster than the interest you're paying. The spread is money you get for free. If it's negative, you're losing money. If it's zero, it doesn't make a difference.
This is speaking in terms of cash flows, not ratios.
In conclusion, there's no general rule and you can get an answer very easy for a specific situation by running the numbers in a spreadsheet.

Ralphy · Post by **Ralphy** » Mon Sep 19, 2011 4:01 am

My primary target is $150,000. That should roughly cover my current level of living expenses.
At that point, I'll be ready to cut back on work, but I'll probably still coach my cross country team (which also pays about as much as my annual expenses).

irukandjisting · Post by **irukandjisting** » Sun Sep 16, 2012 1:39 am

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 · Post by **GPMagnus** » Sun Sep 16, 2012 1:36 pm

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 · Post by **secretwealth** » Sun Sep 16, 2012 2:05 pm

"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 · Post by **GPMagnus** » Sun Sep 16, 2012 2:21 pm

@ 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 · Post by **before45** » Sun Sep 16, 2012 2:24 pm

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 · Post by **Phayen** » Mon Sep 17, 2012 5:06 pm

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 · Post by **JohnnyH** » Mon Sep 17, 2012 5:34 pm

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 · Post by **Phayen** » Mon Sep 17, 2012 9:40 pm

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 · Post by **JohnnyH** » Mon Sep 17, 2012 10:01 pm

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.