Thanks a ton. Makes total sense and very timely, given the hand wringing I’ve been doing of late; transitioning to part time work, easing into retirement. This is a wonderful thing you are doing, and I appreciate it greatly. Ian w
Excellent video. I went out to the Fi Calc..... it is a truly cool tool! And most of all it gave me 100% success rate for even my most aggressive withdraw rate. It's a beautiful thing.
A very timely video as i transition from working later this year to retirement at age 70. i have trying to work this very problem. The huge inflation, coupled with the market uncertainty is making this a difficult nut to crack. i think traditionally you would run to bonds but they they are getting absolutely crushed this year (" worst bond market ever") outside of I bonds which i bought this year for the first time. i think perhaps another video dealing with fixed income is needed in these times. Cash may be trash in the vernacular but at least you dance with the devil you know. Even buying and laddering a bond profile (to preserve the principle unless of course you have to sell). So please Bob your thoughts in another video for what us new retirees should do with our fixed income. thanks.
@Rob Berger: perhaps the most powerful part of this program is that you can start the first couple years at a lower draw (with or without inflation) and then add future draws at various levels or percentages (again with or without and inflation adjustment) to really narrow down where you need to modify your withdrawal strategy.
Rob,are you familiar with a hecm reverse mortgage. There is a great study done by Barry and Steven Sacks that made it to the Journal of Financial Planning (2012)on how a reverse mortgage can mitigate sequence risk And as a side note it was this study that got Wade Pfau to start his own research on using housing wealth into your retirement plan.
How about using a balanced fund and just remove your 4%. Reduced volatility, leave the balancing to the fund and makes it easier when my dementia kicks in and my uninterested wife starts managing the withdrawals.
That is what I am thinking of. You can do Vanguard Balanced or Wellington or Wellesley too. Those are a bit more expensive than pure index funds but still pretty inexpensive. I am about 70 percent stocks now and might retire in 4 years.
We have 5+yrs of $ needs in TIAA Traditional at guaranteed 3%. All else total US & intl. We’ll spend cash if market returns under 3%. Having more cash/bnds at arbitrary % seem unnecessary. Downsides?
@Robberger are you adding to your positions during this drawdown? rebalancing? or is all your capital invested? you don't comment much on your own portfolio management moves.. I ask because I'm in the process of DCA-ing in a large cash position into index funds, I'm 3 years away from retiring. Thanks
Thanks Rob a well done overview of options. You have a knack of simplifying the complex and presenting it in a good summary form. "Money Guide Pro" is the most user-friendly modeling tool that I have used for running simulations. My two cents.
Great video. Love ficalc. One thought I had is what if I used my home equity to fill in the low withdraw years - so if I used a 4% fixed (% portfolio option on ficalc) and if there was a short fall one year in my spending news I would supplement with HELOC. ?
Great Video and information! Any tips on minimizing sequence of return risk as we approach retirement (~10years)? My current plan is that I am going to glide path from my current 100% equities to 50/50 or even 40/60 stocks/bonds to hopefully be ready to retire in 10 years. But, should I start the glide path now, or wait until 5 years from retirement and start the glide path then? Thanks!
There's no one right answer to that question. Personally, I like to start at around the 10 year mark for a more gradual glide path, particularly with stock prices still high. But there's no way to know in advance what the "best" approach will be.
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Thanks a ton. Makes total sense and very timely, given the hand wringing I’ve been doing of late; transitioning to part time work, easing into retirement. This is a wonderful thing you are doing, and I appreciate it greatly.
Ian w
Excellent video. I went out to the Fi Calc..... it is a truly cool tool! And most of all it gave me 100% success rate for even my most aggressive withdraw rate. It's a beautiful thing.
Great video! Sequence of Returns Risk is important to keep in mind no matter what age you retire!
Great choice of topic Rob for those of us in your audience with retirement concerns. Thanks, Bill
I agree. Thank you, Rob.
A very timely video as i transition from working later this year to retirement at age 70. i have trying to work this very problem. The huge inflation, coupled with the market uncertainty is making this a difficult nut to crack. i think traditionally you would run to bonds but they they are getting absolutely crushed this year (" worst bond market ever") outside of I bonds which i bought this year for the first time. i think perhaps another video dealing with fixed income is needed in these times. Cash may be trash in the vernacular but at least you dance with the devil you know. Even buying and laddering a bond profile (to preserve the principle unless of course you have to sell). So please Bob your thoughts in another video for what us new retirees should do with our fixed income. thanks.
@Rob Berger: perhaps the most powerful part of this program is that you can start the first couple years at a lower draw (with or without inflation) and then add future draws at various levels or percentages (again with or without and inflation adjustment) to really narrow down where you need to modify your withdrawal strategy.
Rob, very good job on this. Thanks!Answered many of my questions on sequence returns.
Rob I just started watching your vedios. Love them .
Thanks Rob! Lots to digest, and that's a good thing.
Rough time for folks who recently retired.
Interesting video. Sadly, I doubt I will have enough in my portfolio to live off of but I keep investing, mostly index funds, very little in bonds.
Rob,are you familiar with a hecm reverse mortgage.
There is a great study done by Barry and Steven Sacks that made it to the Journal of Financial Planning (2012)on how a reverse mortgage can mitigate sequence risk And as a side note it was this study that got Wade Pfau to start his own research on using housing wealth into your retirement plan.
How about using a balanced fund and just remove your 4%. Reduced volatility, leave the balancing to the fund and makes it easier when my dementia kicks in and my uninterested wife starts managing the withdrawals.
That is what I am thinking of. You can do Vanguard Balanced or Wellington or Wellesley too. Those are a bit more expensive than pure index funds but still pretty inexpensive. I am about 70 percent stocks now and might retire in 4 years.
Would a dividend based strategy shield you from a sequence of returns risk provided the divs are not cut during times of market duress?
Thanks for amazing information
We have 5+yrs of $ needs in TIAA Traditional at guaranteed 3%. All else total US & intl. We’ll spend cash if market returns under 3%. Having more cash/bnds at arbitrary % seem unnecessary. Downsides?
i don't know why you can't keep 50/50 or 60/40 through retirement.
@Robberger are you adding to your positions during this drawdown? rebalancing? or is all your capital invested? you don't comment much on your own portfolio management moves.. I ask because I'm in the process of DCA-ing in a large cash position into index funds, I'm 3 years away from retiring. Thanks
Thanks Rob a well done overview of options. You have a knack of simplifying the complex and presenting it in a good summary form. "Money Guide Pro" is the most user-friendly modeling tool that I have used for running simulations. My two cents.
Great video. Love ficalc. One thought I had is what if I used my home equity to fill in the low withdraw years - so if I used a 4% fixed (% portfolio option on ficalc) and if there was a short fall one year in my spending news I would supplement with HELOC. ?
Rob: What about the Vanguard Dynamic Floor Ceiling Method in retirement?
Definitely another approach to consider. FICALC has it as one of its options, so you can test it.
When you talk about withdrawal rates, would this be yearly RMD if I don’t withdraw other money from my accounts. Thanks so much!
What is sad about investing is that you get most of your money at an age that you need it least.
Great Video and information! Any tips on minimizing sequence of return risk as we approach retirement (~10years)? My current plan is that I am going to glide path from my current 100% equities to 50/50 or even 40/60 stocks/bonds to hopefully be ready to retire in 10 years. But, should I start the glide path now, or wait until 5 years from retirement and start the glide path then? Thanks!
There's no one right answer to that question. Personally, I like to start at around the 10 year mark for a more gradual glide path, particularly with stock prices still high. But there's no way to know in advance what the "best" approach will be.
@@rob_bergerwhat about for an inherited IRÁ where there are RMDs. What should the allocations be?
CD ladder for the "cash bucket". This allows for me to be making 5% on my cash.... while my IRA and brokerage accounts are riding the market.