@leanit5756 Lol! REALLY?! Ever here of a Sports figure or a Lottery winner going broke with 10 times that amount?! 4% Rule puts 2.6 Million at only 104K/year. Try buying a house or 2 and a fancy car or two and Jet set... Can be blown in no time!
@@leanit5756 and OP -- If you live like hermits like my parents do, volunteer your time for entertainment instead of spending money for entertainment, and don't like to spend money on travel - you couldn't. They can't seem to outspend their social security and small pension despite my encouragement. When people make comments like the one you're making, you're projecting your lifestyle and expenses on that balance, and saying OF COURSE they can retire. But the simple, actual answer to the question is - by having a lifestyle those funds don't support. If you're spending 10,000 / month on basic living expenses, AND another 1,000/mo on health (massage, PT, etc) he has earmarked in the example, AND dropping $175k on a remodel AND spending $45000/year on travel for the first decade or more of retirement, on top of retiring early so adding private health insurance to your costs and having a big gap before social security kicks in -- you might well out of money pretty fast. Now, I don't spend 10k/month now, and I think $45,000/year on travel alone is more than I would need to be happy, and I'm guessing you do too - but it's not really that hard to see how you can run out of money if your lifestyle expectations are that high, is it? So your real response should be: Who needs to spend that much money to get by, even with dependents? And that's a fair question. My guess is - someone who earned more than I did and got used to "the good life" - but who apparently didn't save much more than I did along the way.
It all depends on his expenses in retirement. Using the 4% rule to keep it simple. He would need $3M invested to spend $10k per month (likely more when you consider taxes). So it all depends on the type of lifestyle they are trying to live.
Hey Ari, I love your videos. I'm pulling the trigger on retiring in two weeks (at 60). Numbers wise, everything looks good. At average returns, I'll be pulling around 4% until SS kicks in and then I'll be around 2.5%. It's still scary thinking about turning off the paycheck spigot, especially with the market volatility and the crazy world. Your videos always calm my nerves, though :).
Great video, hit close to home for me. I am in that 2 to 5 year window to retire early. I have been trying my best to model into the software as many of the expected and unexpected expenses I can think of to best avoid any huge surprises in retirement. I have a family with college bound kids during my early retirement so I have that in there as well. My 3 biggest concerns are market performance next few years, health care expenses continually outpacing inflation, and SS cuts in the future. I am ready to stop working but want to make sure I do not have risk of running out of money but also want to have plenty of money so the stress of managing my retirement is not stressful. Would love to have the funds to afford someone like Root but when I model in that AUM fee, it's a huge hit to the overall plan
Actually I think your college bound kids should be your greatest concern. Will they graduate? Will it take 4 years or longer? Don’t expect them to have a good paying career job immediately upon graduation. Do you plan on selling your home? It may be years before they’re able to support themselves. And there’s a lot of assorted college expenses other than tuition, room and board. Sorry if I just blew up your software projections.
The most frustrating part of the software is the “portfolio allocation.” People’s financial lives can’t be summarized that easily, but there is a lot riding on which category is selected.
How realistic is part time income in retirement? I’m in IT. Getting a job in my field is nearly impossible at 55, much less 65. I don’t think it’s wise to assume I’ll have that option. That’s not even taking health into consideration. Even if jobs are available, is it wise to bet on being healthy enough to work?
If you setup the software properly what he’s adjusting would be your after tax spending and also exclude housing. Housing is separate as are goals and vacations from the monthly spend field. Took me a while to figure that all out. Looking at the waterfall detail view really helps show it all
As I plan for my retirement, I’ve been watching videos from all over the world. Yours stands out for its high quality and depth of information. I started investing early last year with $100K, and just last three months, I reached my first $1M USD. Now, I have a portfolio worth $2.5M. My only regret is not starting sooner. If things continue to go well, I should be retiring soon
How did you manage to achieve that level of growth? I'm 55 years old with not enough set aside for retirement at this point. I have always been curious about the market and have witnessed people who played the game right and retired early. Some claimed they started very small, but their portfolio grew over time. I do have a significant amount but I’m unsure about which strategies or approach to take in order to achieve good returns. I'm open-minded and would appreciate any help or guidance
He will be fine at that income to show taxable income if he is trying to qualify for aca subsidy. Sounds like he actually will make too much for subsidy. The challenge is showing taxable income for subsidy if you want to live on 50k before age 59.5. Brokerage acct won't suffice and roth conversion msy not make sense if youre in a lower tax bracket when retired
Let’s do the math on one of my bucket list trips: 8 day Rhine River cruise ($14,000); 2 rt business class tickets from Chicago to Amsterdam ($10,000); additional 2 weeks having fun traveling through Germany/Belgium ($200/day X 14 days =$2800). Total for 3 week trip is $26,800. That leaves $18,200 to divide between spring/summer travel in North America plus winter travel in South America. I agree it’s a red flag - Ari should suggest travel budget of $50,000. ❤❤. The point is that everyone is different - and their plans, desires, and budgets differ too.
Amazing video, A friend of mine referred me to a financial adviser sometime ago and we got talking about investment and money. I started investing with $120k and in the first 2 months , my portfolio was reading $274,800. Crazy right!, I decided to reinvest my profit and gets more interesting. For over a year we have been working together making consistent profit just bought my second home 2 weeks ago and care for my family.
I’ve been forced to find additional sources of income as I got retrenched. I barely have time to continue trading and watch my investments since I had my second daughter. Do you think I should take a break for a while from the market and focus on other things or return whenever I have free time or is it a continuous process? Thanks.
@@ThamaraSchlossarek Quitting may not be the best approach if you ask me. This is where an AI comes into the picture. I barely have time to trade myself as my job swallows up most of my time. *MARGARET MOLLI ALVEY* ..
Thank you, Ari! This was really interesting to see how small changes, and especially spreading out large expenditures, can make a huge difference.
The guy is single with no children. Retirement success with those account balances should be a slam dunk.
For sure. How could a person possibly screw up a retirement with 2.6M, even with dependents?
@leanit5756
Lol!
REALLY?!
Ever here of a Sports figure or a Lottery winner going broke with 10 times that amount?!
4% Rule puts 2.6 Million at only 104K/year.
Try buying a house or 2 and a fancy car or two and Jet set... Can be blown in no time!
If you had Hunter B
@@leanit5756 and OP -- If you live like hermits like my parents do, volunteer your time for entertainment instead of spending money for entertainment, and don't like to spend money on travel - you couldn't. They can't seem to outspend their social security and small pension despite my encouragement. When people make comments like the one you're making, you're projecting your lifestyle and expenses on that balance, and saying OF COURSE they can retire. But the simple, actual answer to the question is - by having a lifestyle those funds don't support. If you're spending 10,000 / month on basic living expenses, AND another 1,000/mo on health (massage, PT, etc) he has earmarked in the example, AND dropping $175k on a remodel AND spending $45000/year on travel for the first decade or more of retirement, on top of retiring early so adding private health insurance to your costs and having a big gap before social security kicks in -- you might well out of money pretty fast. Now, I don't spend 10k/month now, and I think $45,000/year on travel alone is more than I would need to be happy, and I'm guessing you do too - but it's not really that hard to see how you can run out of money if your lifestyle expectations are that high, is it?
So your real response should be: Who needs to spend that much money to get by, even with dependents? And that's a fair question. My guess is - someone who earned more than I did and got used to "the good life" - but who apparently didn't save much more than I did along the way.
It all depends on his expenses in retirement. Using the 4% rule to keep it simple. He would need $3M invested to spend $10k per month (likely more when you consider taxes). So it all depends on the type of lifestyle they are trying to live.
Hey Ari, I love your videos. I'm pulling the trigger on retiring in two weeks (at 60). Numbers wise, everything looks good. At average returns, I'll be pulling around 4% until SS kicks in and then I'll be around 2.5%. It's still scary thinking about turning off the paycheck spigot, especially with the market volatility and the crazy world. Your videos always calm my nerves, though :).
@@KxK-ty5bq thank you…and CONGRATULATIONS!! Sounds like you’re in a very strong spot.
@@earlyretirementari Hey! Thank you! I'm excited and nervous.
We retired in 2019 with no debt and got lucky with substantial growth in our retirement portfolio from 2019 to present.
Excellent video, thank u! Ari can u do a video on LTC insurance vs. self-insuring/using savings? Or do u have one already?
Thanks! Yes - here it is: How To Plan For Long-Term Care (All You Need To Know)!
ruclips.net/video/XYLYveBOJg4/видео.html
Great video, hit close to home for me. I am in that 2 to 5 year window to retire early. I have been trying my best to model into the software as many of the expected and unexpected expenses I can think of to best avoid any huge surprises in retirement. I have a family with college bound kids during my early retirement so I have that in there as well. My 3 biggest concerns are market performance next few years, health care expenses continually outpacing inflation, and SS cuts in the future. I am ready to stop working but want to make sure I do not have risk of running out of money but also want to have plenty of money so the stress of managing my retirement is not stressful. Would love to have the funds to afford someone like Root but when I model in that AUM fee, it's a huge hit to the overall plan
I’d recommend reading this: advisors.vanguard.com/content/dam/fas/pdfs/IARCQAA.pdf
Actually I think your college bound kids should be your greatest concern. Will they graduate? Will it take 4 years or longer? Don’t expect them to have a good paying career job immediately upon graduation. Do you plan on selling your home? It may be years before they’re able to support themselves. And there’s a lot of assorted college expenses other than tuition, room and board. Sorry if I just blew up your software projections.
Hi Ari! Great video! Where are the expenses for medical insurance before 65? It’s so expensive … in California. Thanks so much!
Thank you. It’s defaulted on at ~6k/year and not as much as you think: ruclips.net/video/BykvoxJEWGo/видео.htmlsi=qY5dhO7aZu7w8N-3
If this guy can't retire comfortably he's got a major spending problem.
What about Long Term Care at the end of life. That could be a large number.
Use the analysis tool in the academy to plan for it!
The most frustrating part of the software is the “portfolio allocation.” People’s financial lives can’t be summarized that easily, but there is a lot riding on which category is selected.
@@GotGracexxxxx importance of good investing.
@@earlyretirementari Which investment category matches this portfolio? 20% Brk.b, 18% MMkt, 12% PHYS (gold), 15% stocks, and 35% split evenly between QQQ, VOO, VEA, IWM and VWO.
Is the 120k net or gross ?
@@andrewrichmond2989 always net
How realistic is part time income in retirement? I’m in IT. Getting a job in my field is nearly impossible at 55, much less 65. I don’t think it’s wise to assume I’ll have that option. That’s not even taking health into consideration. Even if jobs are available, is it wise to bet on being healthy enough to work?
Completely depends on your field and flexibility
Is the spending amount per month after taxes or before in your worksheet?
If you setup the software properly what he’s adjusting would be your after tax spending and also exclude housing. Housing is separate as are goals and vacations from the monthly spend field. Took me a while to figure that all out. Looking at the waterfall detail view really helps show it all
After
How do people, even with dependents, spend $8k/month without a mortgage? When we add big expenses separately, that’s a huge monthly spend, right?
i mean, it all depends how well off you are, how high the cost of living is where you live as well. if you live in sf, 8k/month is probably nothing
As I plan for my retirement, I’ve been watching videos from all over the world. Yours stands out for its high quality and depth of information. I started investing early last year with $100K, and just last three months, I reached my first $1M USD. Now, I have a portfolio worth $2.5M. My only regret is not starting sooner. If things continue to go well, I should be retiring soon
How did you manage to achieve that level of growth? I'm 55 years old with not enough set aside for retirement at this point. I have always been curious about the market and have witnessed people who played the game right and retired early. Some claimed they started very small, but their portfolio grew over time. I do have a significant amount but I’m unsure about which strategies or approach to take in order to achieve good returns. I'm open-minded and would appreciate any help or guidance
He will be fine at that income to show taxable income if he is trying to qualify for aca subsidy. Sounds like he actually will make too much for subsidy. The challenge is showing taxable income for subsidy if you want to live on 50k before age 59.5. Brokerage acct won't suffice and roth conversion msy not make sense if youre in a lower tax bracket when retired
Your tool is showing us “current allocation”? What is his current allocation? That matters.
65% equities, 30% fixed income, 5% cash.
What do you think of VMFXX instead of BND for the 40% of your “bond” part of your portfolio since it has never broken the buck?
VTI 42% BND 30% VXUS 28%
@ but BND was not protective in 2022. VMFXX was.
@@Steve_SEC A money market fund is much safer because of the longer term bias toward higher rates. Please note, A BOND FUND IS NOT A BOND!
$45, 000 for traveling? This is surely a red flag 😂
Some people!
@@earlyretirementariis that 45K per month? Monthly spending was 10k just above.
@ 45k year
Let’s do the math on one of my bucket list trips: 8 day Rhine River cruise ($14,000); 2 rt business class tickets from Chicago to Amsterdam ($10,000); additional 2 weeks having fun traveling through Germany/Belgium ($200/day X 14 days =$2800). Total for 3 week trip is $26,800. That leaves $18,200 to divide between spring/summer travel in North America plus winter travel in South America. I agree it’s a red flag - Ari should suggest travel budget of $50,000. ❤❤.
The point is that everyone is different - and their plans, desires, and budgets differ too.
@@clutchputt4640 as long as you keep annual expense under 6% of the assets.
Amazing video, A friend of mine referred me to a financial adviser sometime ago and we got talking about investment and money. I started investing with $120k and in the first 2 months , my portfolio was reading $274,800. Crazy right!, I decided to reinvest my profit and gets more interesting. For over a year we have been working together making consistent profit just bought my second home 2 weeks ago and care for my family.
I’ve been forced to find additional sources of income as I got retrenched. I barely have time to continue trading and watch my investments since I had my second daughter. Do you think I should take a break for a while from the market and focus on other things or return whenever I have free time or is it a continuous process? Thanks.
@@ThamaraSchlossarek Quitting may not be the best approach if you ask me. This is where an AI comes into the picture. I barely have time to trade myself as my job swallows up most of my time. *MARGARET MOLLI ALVEY* ..
@@ClarieZwiehoff Oh please I’d love that. Thanks!
*MARGARET MOLLI ALVEY*
Lookup with her name on the webpage