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How To Never Run Out Of Money In Retirement: Answering A Common Question & Revisiting The 4% Rule
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- Опубликовано: 11 апр 2018
- After two decades of financial media bashing, is it time to revive common retirement beliefs?
Recently, the Wall Street Journal caused a stir with an article titled, Forget the 4% Rule: Rethinking Common Retirement Beliefs. From the title, the author’s premise is clear - rethinking tradition is long overdue and, by following conventional rules-of-thumb, the average retiree is at risk of going broke.
Is he right? Well, let’s look at the rule in question.
Read more here: www.wesmoss.com/news/the-new-...
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Please note, this information is provided to you as a resource for informational purposes only and should not be viewed as investment advice or recommendations. Investing involves risk, including the possible loss of principal. There is no guarantee offered that investment return, yield, or performance will be achieved. There will be periods of performance fluctuations, including periods of negative returns. Past performance is not indicative of future results when considering any investment vehicle. This information is being presented without consideration of the investment objectives, risk tolerance, or financial circumstances of any specific investor and might not be suitable for all investors. This information is not intended to, and should not, form a primary basis for any investment decision that you may make. Always consult your own legal, tax, or investment advisor before making any investment/tax/estate/financial planning considerations or decisions.
I think the retirement crisis will get even worse. A lot of people can’t save because of low paying jobs, inflation, and insane rental rates. And now that home ownership is out of reach for middle class Americans, they won’t have a house to retire with either.
Things are a bit strange right now. Inflation is making the dollar weaker for buying things like basic needs, but it's getting stronger against other stuff. So, stuff like stocks, houses and precious metals aren't doing so great because folks are putting their money into banks for safety but I'm worried about my retirement savings losing value fast.
Even if you’re not skilled, it is still possible to hire one. I was a project manager and my personal portfolio of approximately $400k of my retirement pension took a big hit in April due to the crash. I quickly got in touch with a financial-planner that devised a defensive strategy to protect my funds and make profit from my portfolio this red season. I’ve made over $250k since then.
Thanks for replying, You seem to know much, How did you go about it and can you recommend an advisor like yours?
‘’Aileen Gertrude Tippy” just check her out. It's possible to hire a skilled financial planner especially if you're not one yourself. I hired one after my retirement pension took a hit in April due to the crash.
I appreciate this tip. It was easy to find your coach's webpage by looking up her name online, She seems proficient considering her resume.
More and more people might face a tough time in retirement. Low-paying jobs, inflation, and high rents make it hard to save. Now, middle-class Americans find it tough to own a home too, leaving them without a place to retire.
The increasing prices have impacted my plan to retire at 62, work part-time, and save for the future. I'm concerned about whether those who navigated the 2008 financial crisis had an easier time than I am currently experiencing. The combination of stock market volatility and a decrease in income is causing anxiety about whether I'll have sufficient funds for retirement.
This is precisely why I like having a portfolio coach guide my day-to-day market decisions: with their extensive knowledge of going long and short at the same time, using risk for its asymmetrical upside and laying it off as a hedge against the inevitable downward turns, their skillset makes it nearly impossible for them to underperform. I've been utilizing a portfolio coach for more than two years, and I've made over $800,000
Mind if I ask you to recommend this particular coach you using their service?
'Carol Vivian Constable, a highly respected figure in her field. I suggest delving deeper into her credentials, as she possesses extensive experience and serves as a valuable resource for individuals seeking guidance in navigating the financial market.
She appears to be well-educated and well-read. I ran an online search on her name and came across her website; thank you for sharing.
Retirement is a wonderful feelings when it is done with a good plan, some gets frustrated when they are retired because of lack of good plans of living.
Yes you're right the key of happiness when you have retired is the amount of money you have saved during your working days.
@Mia Lucas you are right the market is moving well, bitcoin is now 56k I believe it will raise before the end of the week.
I would have love to invest in bitcoin and other crypto currencies but it's difficult to understand the market.
@@elenabaldo2319 as a beginner I will advise you to work with madam Cynthia Edna, for good and huge withdrawals.
@Saud Farha yes you're right
Great video!! Simple answer is to start investing now(with help) to build via compound interest .I made my first million this way after I met a popular stock broker in the U.S who accepted to trade for me after I lost almost a fortune in liquid asset trying to trade my self. Close to retirement now with no financial fears
I'm a beginner, have lost quite a lot too though I'm not close to retiring. Who is the broker who helped you, hope she'll be fine working with me and how can I reach her please.
@@herbertAnderson534I Amanda Blair Peters! Was in the news when she revived Grumac in 2018. Look-her up to get all you need about her.
@@dr.karidouglas1312 She is a great speaker too. Met her once at a seminar in Dallas. Stories about her always sound miraculous lol
@@kathleenstoner.n7499 Wow. This is the second time I'm encountering her name this week. A colleague of mine said she managed his portfolio and she doubled his profits in months. Will definitely reach out now
Amanda is a fraud -- don’t ever trust her with your money 💰
Good advice. The problem is that historical returns do not guarantee future returns. Yes, the research done investigating withdrawal amounts at every possible starting year is very impressive. Hindsight is 20-20, as they say. My father grew up during the 1920s in Germany, however. That was an example of when the best laid plans just went out the window. He recalled having to take family heirlooms to the baker to buy some bread because the baker wouldn't accept the worthless currency anymore. Maybe that economic catastrophe isn't something anyone can plan for. But it does suggest that putting social security on a sounder financial footing might be a good idea.
When I was young. I met a Kennedy in Florida and he told me to give up the ideas of saving money and withdrawing it during retirement years. Just live your life and invest in business and compound your businesses up so you can withdraw from it, during your old age, not your retirement age. There is no such thing as retirement. It is up to you to prepare for your old age. He work one hour a day tracking a chain of businesses he own using a computer and phone. The model that the financial advisor gave to us is steering us to being poor.
@@blacklight3330 Not everyone is cut out to be a business owner. Most of us are employees. Social Security is an important component of most people's retirement plans. It just takes some political will to fix it. We should demand our politicians do so. Live long and prosper!
Retirement = zero debt and spend less than your income. Not complicated
exactly. i work at a refinery and you would not believe how many retirees buy a new house, high dollar truck and go oncrazy expensive vacation only to have to come back and work again. ridiculous
@97RAVINEAVE exactly what i was thinking. Too many variables in the real world
@@mr.nmoney3554 or buy RVs and lose there ass
Most retired people don’t have enough assets to just live off the income. So they need to slowly spend the principal, which guarantees that they will eventually run out of money. This video assumes that you can live off the income.
Since I retired I've been making money off goldminer's strategies and they also cleared my debts ( A few of the strategies include Weekly bank transfers, sales of hacked high limit credit cards, money order pick ups e.t.c Talk to Hinds.Larry on Instagram for help
Really well explained! 👍 and thanks a lot for taking a conservative approach. Better safe than sorry
Most retirees do not need it to last 40 -50 yrs
Exactly if you retire at 60 if your lucky you need it for 25 years tops and when your over 80 what are you actually spending it on anyway
@@suphatrachaiyasit7531 When you are 80 you'll disagree unless your filthy rich
I have never seen a 80 year old complain they have too much money
Retirement is about having no debt and your spending habits
If I have 7 figures, growing at 7%.. why would I not use the banks money at 2-3%?
It worked for me. I never made more than 50K a year. As soon as my pension and SS reached 80% of my take home pay, I retired. It was more than enough to cover my non discretion expenses. My other assets did not enter into my equation.
@@howellwong11 Most of these analysis do not seem to take into consideration pensions and social security. If you're bringing in $90,000 with your pension and SS and you have another $600,000 in a 401k and your house is paid off you don't need 4% from your portfolio especially if you have a budget of $50,000 a year. Even in the current market you can let the money ride until the market improves. These analysis seem to be very general in their assumptions and not applicable in many cases.
Lowering my cost of living drastically, have a small home/cabin paid off, vehicles paid off and I have no desire of luxurious lifestyle expenses like sports cars and boats. I plan on camping a lot on my retirement, minimizing as much as I can. I'd rather be retired and live comfortably now, rather than retire to the nursing home and have the scavengers waiting to pick my bones clean - as it seems that's what the government wants everyone to do, work their entire lives and then die. No thanks.
Right on! The two things I remember the most from my law school estate's class professor. The first sentence he spoke: "This a class about greed" and, 2. " Where meat lies wolves gather".
I am exactly the same way! Less is more much more I want to live simple I do live simple and free.
Thank You!
Two things I am curious about. 1. Did you include the increase when someone is eligible for Social Security? 2. Did you include the decline in spending as we age? Some data suggest that once we hit 70, we generally start spending less, partly due to mobility etc.
The absolute best financial move you can ever make is to craft a low cost lifestyle that you're happy with. It helps you amass wealth, reduce or eliminate taxes and makes your money last forever as you just get wealthier as time passes. When you're gone, your wealth can be passed on to relatives, friends or help others in need. The really funny part is that it's actually a much better life than the norm filled with everything you need like family, friends and neighbors, wonderful home cooked meals, unlimited home entertainment with an antenna and a library card, as many vacations as you like since they're extremely low cost and don't involve anything like planes, rental cars or expensive hotels/resorts. Above all, freedom from money worries and the stress that goes with them.
Totally agree with you. We have been doing that and it works. Creating community is so important.
nonsense, money is gold and silver, has been for 6500 years, since when have you perfected the art of making it, fool.
@@paladin1066 My friend keeps telling me that. He says just keep buying gold and silver.
More important than ever advice considering half the country is surviving on low income wages or pension. Most of the the country doesn’t have a portfolio or even own stocks! Don’t buy into consumerism and the marketeers.
All very true but I have no intention of leaving money to my kids. I have seen families torn apart over inheritance. I wouldn't do this to them.
Given the randomness of markets, I encourage retirees to keep 2 years worth of portfolio withdrawal needs in cash. Regardless of allocation (100/0, 70/30, 60/40, etc) on the stock side of the portfolio, having a dividend growth strategy makes the most sense. The dividends will cover a portion of your yearly withdrawal needs. Once the market eclipses -25% in a bear market, turn off the dividend distribution, and elect to reinvest the dividends. I use 25% as a threshold because most corrections are 5-20% down, so -25% gives more confirmation that we’re going to be in a bear vs. a quick correction.
Start drawing from the cash cushion for 12 mos and then revisit values at the end of that 12mos and see if the market has rebounded or not.
So instead of depleting your portfolio in a big down market, you’ve reinvested your dividends at a temporarily discounted level and added to your holdings while using the idle cash to substitute for your withdrawal needs.
Very educational!!!!!!!!!!!!!
We have no one to leave the estate to so we plan to slowly spend retirement funds to the point where it’s depleting year over year but leave enough for each year. The key is to make sure we don’t have debt, don’t create more debt in retirement, and don’t overspend. The goal is to make the money last 40 more years.
That sounds like a great plan, Denis!
SUBSCRIBED!
Wifey and I have essentially retired from the horrible rat-race, miserable commute, etc. etc. She's 62, I'm 58. We've now low pressure freelance/PT jobs 'just to keep us busy'. We've no debt (Suze Orman would be very proud). We own our house. Our health is good. No kids. Our yearly living expenses are low, compared to most people we know. We've always been fiscally responsible, BOTH of us. We've never lived above our means. We've done the math and, if we live til 90, we'll have enough to comfortably live on, yes at 4% (even a little higher). One thing, though, we gotta get out of NY or we'll end up poor.
So your not retired!
So many people avoid this important topic. Thanks for the information.
ha, i think by many, it's many uninformed people, even withing these comments.
thing is, the advisor barely scraped the surface of retirement planning, so i would have to say that many have much more info to learn--not really their fault, as this presentation was very lacking.
being that this is most likely a pitch, i would have to say that the advisor fell short by not really trying to explain much in the way of strategies. if he had done so, the responses would likely have been much, much different.
Really great video thank you
Can always live in your car in the walmart parking lot
You'd save on fuel driving to Walmart!
Retirement has very simple things that not everyone wants to do- Zero debt- Pay your debt off as fast as possible
- Spend less than your income- Don't buy useless things that you are only going to use a few times
- Try to spend even less once you are retired for the first while so you can have a larger retirement if you retired a a young age
- Run the cost of renting vs owning. Renting isn't always the cheaper option.
Very good update - makes so much sense.
Very well explained. For everyone in the comments saying this doesn't apply to you because retirement is a myth... Have you stopped living the typical American consumer lifestyle? Have you maximized your earning potential? If not, then you are right and you are typical, retirement might be a myth to you. But I'm doing everything I can to optimize my family's savings rate, and constantly reevaluating. I do not plan to work into my 60's, or 70's like the typical America.
So if you have the 50:50 stocks/bonds split - when you take your annual withdrawal do you take if from the stocks or the bonds, a mix etc or does it not matter provided you realign to 50:50 afterwards?
What interest is earned on your retirement account while on retirement? Are you assuming an extremely low yield for safety reasons? Say 3-4%?
Wes, great info. I have heard some ‘Experts’ suggest data shows that the average spending of retired people is not consistent over their golden years; we spend more in the first years of retirement while we are more active and less as we get older. The hypothesis is that our withdrawals could reflect this variance vs a straight percentage….how do you feel about this perspective???
I read these comments and everybody has a different view of their future lives. I see so many old people live in crappy conditions, counting their days. How is that quality? Is this what they planned for? Did they plan at all? What are the odds the government will leave their mitts off a big fat 401K or 403K or IRA? I say this, whatever you have for assets, look to start making your dream life start to take shape at no later than age 55. It might take another 5, 10, 15 years to get there. What kind of weather do you like, where can you live to get there, what are your core interest and for heaven sake pay closer attention to your health than you ever did at a young age. Things will go wrong along the way, they always do. Lets face it, we don't think about these things when we are young.
I will agree.. what type of old age life will you have if you have money saved.. but you visit the doctor all the time.. and really aren't fit to do anything now that you have the freedom to do stuff. Everyone loses out in the end..the system we created with government ,makes sure it has you in retirement age.. matter of fact they don't believe in older Americans , only the money machine and youth to wear out. We the retiring.. r money going out of government pockets , they wish us dead mostly or let medicine wipe out r finance.. before we die.
@bou path
life goes on..
long after the thrill...of living is gone?
Thank you so much for your response.
Retirement is culturally constructed. Mentally We all have to be inclined in gaining productive in our finances. I don’t plan working when I can’t be productive at my 50s. I enjoy being productive and financially enabled.
If not planned the right way, you will have less money, milling around bored and mostly end up laying around in front of the Tv, living to eat and sleep.
Haha Bertram this is simply the truth!
It’s a whole trading firm. I checked out the website and the company on IG
Thanks for this buddy
Yes Jessica! I want a better lifetime
Really well done and highly educational video. Thank you!
I see your Wilson n-code tennis racquet on the background.
Live of dividends never run out...
Good information most people who need to hear this aren’t watching these videos
Super smart guys ran Long Term Capital Management
My retirement plan is simple: Become an expat. Move out of the USA where the cost of living, and especially housing, has become ridiculously high.
I hope you don't mind the crowd of people trying to get in to the USA.
Good plan if you have the right disposition. Your costs will plummet but never stop using your head.
Worked for me
what country?
Pro tip: Don't come to the Netherlands. Our government will tax the hell out of you (and housing is still expensive).
Very good information.
What about required minimum distributions? Seems like there is no option on the minimum amount to withdraw...
hi, does this rule apply worldwide? im in the uk
cheers.....john
since metrics are used in the uk and there's no possible conversion, you are on your own.
Interesting.
easy dont take out more then your account is getting from dividents or other sources.
Don't listen to people who try to tell you there is a simple formula for this type of problem
Can I reach out to you for personal advise?
Michael, I have team in place that can help. Here's a link where you can get in touch with me. www.wesmoss.com/contact/
50 years after retiring!
Yeah. Did I catch that right?.hes planning 50 yrs... holy moly....
I think the key is to have some discretionary expenses where you can cut back on the market down years. I use a monte carlo retirement planner (FRP) and recalculate periodically to see what my spending rates could be. But, I've run some mock scenarios, and if the market drops a significant percentage and I adjust my spend rate accordingly and quickly it really de-stresses my portfolio. Another thing, as I get closer to my life expectancy, my spending rate can increase similar as the RMD tables increases your withdrawal rates as you age. Your "safe withdrawal rate" would be based upon your life expectancy, value of your resources, and growth rates.
I say keep on working. You don't need to work full time but there's great sense of worth by carrying on doing something that's useful to others and produces income. Now 66 - no intention of retiring any time soon . I do like what I do and that's important too!
If you love what you do, I think that's a great idea!
I totally agree with that. I want to retire to I have more time to do what I actually want to do
The Cost of healthcare and longevity are your two biggest concerns in retirement planning.
Agreed. And the strongest predictor of both is your family history.
See my tldr post above. Regarding the need to financially plan around the cure for the aging disease in the next few decades.
Yes so invest in your health by exercise and good diet. No smoking, limited alcohol. Keep BMI to 25 or less. You don't need the gym - just walk plenty at good pace, dance and push yourself gently. Steer clear of junk foods which will clog your arteries. Vegetables will clean them. . Live long live healthy! Insure in YOURSELF!
@keekeemyfirstcat you're much less likely to develop issues like heart problems and diabetes if you're too skinny rather than too fat
@@kerryfoster1 -Great advice and so simple:)
Wes, what would the outcome be if you take out 5% per year without adding for inflation every year? Assuming 1 million in savings
With a January 1st, 2000 starting date, assuming a 5% withdrawal?
With actual returns and inflation (2000-2017), then 5%, 1% and 0% (assumed returns for stocks, bonds and inflation, post 2017) - money still lasts 33 years. With a constant $50,000 withdrawal (from the beginning) you get up to 65 years.
Here's the written version of this research: www.wesmoss.com/news/the-new-verdict-on-the-4-rule-for-retirement/
What about required minimum distribution?
what happens if you have 100 % in stocks ? is the equation the same ?
The 4% rule is just based on having your portfolio hold 50% to 70% in stocks. I generally don't recommend that folks in or nearing retirement hold 100% of their portfolio in stocks. If you'd like, you can reach out to my team at www.WesMoss.com to speak in more detail about your current investment strategy.
Thanks Wes! Very helpful.
I retired in the middle of 2007, so I got hammered by the financial meltdown of 2008. Fortunately, I didn't have to touch my retirement investments so I was able to recover. But it was an eye opener!!
What a scary time to retire! Glad to hear everything worked out for you.
I'm retiring next year, right in the longest bull market ever. We've saved plenty, but I've educed my equity exposure considerably
@@easterlake That definitely worked out well for you, nice.
I’m at 6:01, he’s said the same thing several times. Nothing earth shattering. I’m gonna bail out and watch videos of attractive young women shuffle dancing.
LOL
To tommy k: You lasted that long!? I fell asleep at 1:43! I am going to join you now.
Haddaway's What is Love my fav shuffle dance video.
Oooooo... you're such a financial guru. Sounds like you "know it all". Do tell!
Brimful of Asha.
GREAT
The principles that you explained would apply even outside of the US. Thanks for this video
You’re the only one I think to mention adjusting for inflation every year.
And adjust your take down based on hoe the fund did. Bad year = take less next year.
Hello Alison
How are you doing today?
Stayouy of debt. Stay invested in some equity’s. Have enough capital to weather downturns in the stock market.
Why would you have anything in bonds of you are assuming a 1 to 2 percent loss to inflation ?
One might want to put a lump of money in bonds... if you have had a frontal lobotamy
@@aaronszymanski4589 negative 20 if it means +10 for the next 10 years
@@aaronszymanski4589 I only see bonds as a short safety net. I knew somebody that had a year's income as a stock market crash fund.
Short story is its all about sequential return/withdrawal risk. good video (make sure people know you have to pay taxes out of the 4%)
pgreenx
That's why I have Roths.
I have try to balance between traditional and Roth to control that
Long term gains are 0% for the lowest 2 tax brackets.
Great point! Could not agree more. In fact, ticks me off that advisors don't factor in taxes OR investment fees in these calculations!
So you are using after tax $, taxed at your highest earning years to contribute to your ROTH vs. putting the same $ into pre-tax investment vehicles like traditional IRA and 401ks and then pulling them out to pay a lower tax rate in retirement when you most likely will need less income?
excellent discussion. only thing is that i'd like to see the actual math vs market scenarios (historic years) from your analysis.
Here's a link to the article for this topic: www.wesmoss.com/news/the-new-verdict-on-the-4-rule-for-retirement/
I don't need my savings to last 50 years. I retired at age 65. I will not live to be 115. Thirty years of retirement will be enough.
You're being realistic.
Heyy I have an Question, In Two Years From Now I Should Be Able to Retire With Pension, $4000. plus For a month For Life Or I can Roll over 1 1/4 million to Vanguard Account , My Question is can I live off of Dividends? How much would I get in Dividends with the rates right now ?? If I were to roll over My pension or will my funds be able to last 30 years?
Just an Thought, My// All life is not Guarantee , If I would Pass Other then Insurance, My Pension stops, Not Marriage. But If I were my wife would get 1/2 Of My Pension Per Month.
At Lease I would have Money to share .. Just a Thought..
Hey Kenneth, these are all great questions but they're pretty specific to your situation. Would you mind submitting your question on my contact form and letting a Money Matters team member work with you on this? That way we can be sure to give you a more accurate answer. www.wesmoss.com/contact/
what you are leaving out is that when we get older we start to spend a lot less money every 5 yrs your spending will drop more then inflation will go up. so you do not need to take in count for inflation. when will all you experts take that into count I do not have higher education then high school. if i can figure this out how come you guys can not. how i know this from first hand experience with living with my grandparents. watching then from the time they were in there 60s to when they past away over time they no longer spent money on thing that they did when they were young. like driving they only drove like 1 or 2 miles from the house at most from when they were younger they would drive like 10 to 20 miles or more at one point they stop driving so now they did not even have a car in which they did not need to pay for insurance any more. and that is just one thing they stoped spending money on.
GO GO years in your 60s....slow go years in your 70's...no go years in your 80's. healthcare and long term care big ones to worry about way down the road
3 years into retirement and retirement funds drop 20+% for reasons beyond my control. Do I have to cut my life style drastically now until/if my retirement funds recover in a year or two?
If you can cut back now it would help you down the line. That being said recessions should be worked into your retirement
Reducing your spending will help and NOT selling your investments also. On the other hand it's hard to say without knowing what your invested in specifically.
Good advice
A key lesson I learned in College was "Time value of Money" luckily, I started saving at 16.5 years old( Was doing it already, had depression era parents to instill this in me ). Things like buying Microsoft at $34.17 help (week before Windows 8) I have continued to buy when I know the stock is good and depressed. In Microsoft's case it was the silent decade with cloud on the horizon (due to DOJ antitrust case) . I invested and it's been up ever since. Other winners were NVDA, a while back. Recently at Covid drop.. HLT and SBUX. Most of my value is from Mutual Funds. Luckily, I taught my wife this lesson early at 25 years old. So, the 4% rule should work fine for us . I taught both my sons this lesson, both are ahead of their peers. My wife has assets too.
Anyone can invest think of companies (you like) that are #1 or # 2 in an industry and bolster with High Quality no-load Mutual Funds (to spread out the risk in different sectors) . Diversify and take those opportunities like NOW to lower the years off your Mortgage. Get a 15yr one and not a 30 yr one...pay the same. You may have just saved over $75K as in my case when I went to 15Yrs (Decreasing the months/years of paying it off) . My home will be paid off soon. Way before retirement.
Don't let anyone tell you how to invest , learn yourself. Its not hard stocks go up always have
The killer lesson was a professor stating "Say you are 16 and save $2000 per year in an IRA then stopping at age 24, its the same as strarting at age 24 and saving $2000 per year until you retire at whatever age that is".... This is a free "Time value of money" lesson from a UCSD professor.. that solidified it and at times I was pimping 18% into retirement while still young.
Thank you. You're helpful. Ignore the haters. Keep going.
Maybe I'm old fashioned , but I think hard work IS and SHOULD be part of it referring to the opening advertisement
one mention of adjusting spending in bad market years,
I've had good success with Dividend Funds that provide a monthly dividend.
I look for the lowest NAV (e.g. $10/share) and the most stable NAV (e.g. managed to within $1 per share over at least 5 years).
Since the dividend is calculated per share, I want the highest number of shares for my money.
It is “How never To Run out of money,” not ‘how To Never.’
When is the next sumilate check coming
Retirement planning at any age can be challenging until I was convinced by my late husband 2 years ago to seek a financial expert which I did, just recently acquired a 3 bedroom apt in Toronto for $650,460
sorry for your lost, if you don't mind can you tell me the name of your financial expert and how does he help you earn money
@@gabriellataller1833 I'm good ok, my financial expert's name is Robert Johnson, he's a life saver, I was at a point not losing my mind because of the depression of owing alot debt, but then I did as he ask and now I'm making $8000 on average a week.
He's a finance philanthropist trader because he helps people trade and earn more not to make money but to better lives.
@@hilarybrian8106 I think I'm grabbing this, can I get your financial expert on whats✔️app??
@@paul.l6310 yeah
*+ 1, 3, 4 , 7, 6, 7, 6, 2, 9, 6, 5.*
For me it comes down to spend less than I receive. I only use what I truly need each month. Sometimes I truly need a day trip for sanaty. And other times I am happy to eat beans and salads and simply go for walks and enjoy where I live.
But I always spend less than I make. (Except for Home repairs. That can take your savings and cause you to start again) depending on the extent of the damage.
@ Piper Mccoy - Trump (Orange Mussolini) has loosened banking regulations and payday lending restrictions making it much easier for these blood sucker bankers to continue to screw people! He has also weakened the Consumer Protection Agency making it easier for Americans to get fucked over by credit card companies! He is a con man who’s policies clearly only favor the rich and not his dumbed down base.
@ keekeemyfirstcat - I don’t disagree with your comment but that isn’t my original point. Obviously cash is king and everyone should want to avoid CC debt! The fact is Trumps policy’s favor the banking industry and the credit card industry and screwing over the consumer. The weakening and elimination of Consumer Protection laws is a mistake and bad policy. Wilbur Ross isn’t working for you and either is the policies of Orange Jesus. Screw Trump and the golden escalator he rode in on! 🇺🇸🇺🇸🇺🇸🇺🇸
Hello Kathy
How are you doing today?
I live in central Jersey. We have the worst governor in history. Paying 14,000 a Year in property tax for a tiny cape cod house. Have to move to the south before we go broke.
What age are you starting the 4% withdrawal? I hear that matters.
When I refer to folks retiring, I typically assume they're in the age range of 62 - 70. The age you start withdrawing certainly matters since you should always keep your time horizon in check when planning your retirement. That said, every individual will have a different financial picture and different timeline. That's why it can be helpful to consult with a financial planner.
If you'd like to learn more about the 4% Rule and my study, be sure to read this article - www.wesmoss.com/news/the-new-verdict-on-the-4-rule-for-retirement/.
Retirement is a financial number not by age..when u achieve the amount of yearly expenses x 25 that’s when u can retire based off of portfolio growth or dividends
Also don't take out money if you don't need it
Hello susan
How are you doing today?
I am so lucky retired at 55 and moved to Cebu Philippines......I had a good federal job and could have continued to work, but life is short....sometimes you have to make moves to improve your life.....I give myself some credit due to the fact that I have 3 pensions.....but also got a lot of breaks along the way....
Welcome to...facebook? While on RUclips...LOL!!!
Allen T: Thanks but that's the one I commented on. I will give it a second look. Just so you know, if you don't, SoSec stops when you do.
Mike McG..... 6-8% right now in National Banks in Saigon or HCMC if u will Vietnam but only in VND accounts USD accounts are next to nothing
Not planning on selling any equities to fund our retirement, so no 4% rule here. Greatly prefer a combination of pension (yes, they do still exist), social security and dividends from common stocks (until and unless they can be replaced with interest some day). Might also work part-time if we find something that we truly enjoy, though the foregoing three pronged strategy should rough out to 20% more than we "need" each year.
Love this discussion. Thanks.
I retired one year ago, I know, I know, bad timing. The question I have is, withdraw 4% of high water mark?
So the "new verdict" on the 4% rule is that it's correct?
This doesnt account for taxes or fees ?
The Industrial Revolution is lead by one technology - Digital Automation. You master that, you win in in life.
The biggest problem Americans have is not that they don't know how much to spend in retirement, it's that they don't save to have anything to spend. Chattering about whether to spend 4% or 6% or 2% is scarcely on point when you have only $16,000 in your account -- the median amount American families in the age 60-64 cohort have in retirement savings.
I think he is talking to the people who did plan for retirement and to those who are currently planning. Those who expect others to take care of them in their retirement are not watching these kind of videos. Let's not bring us all down to the lowest common denominator.
All these videos never mention if you have SS and a pension on top of savings.
I think the rule assumes you’re getting SS & or pension which may reduce the percentage you’ll need to pull out.
It’s not about total income. It’s about how much you take out. It doesn’t matter what other money you spend. Your portfolio will run out or not depending on withdrawals.
(how much money do I need in a year including taxes) - (How much I get in pensions and SS) = (withdrawal amount)
The withdrawal amount should be only 4% of your investment portfolio.
If you can afford to retire
There are actually no particular sectors to focus on. I was just fortunate to have the guidance of MIRIAM ASPEN GEORGE . She works for AMERIIPRISE FINANACIAL SERVICES near my office so I see her often to discuss my business. You can use something else. for me, her strategy works hence my result. She provides entry a nd exit point for the securities I focus on.
And at what rate are health insurance fees and property taxes increasing?
Dave Joseph yea don’t forget about Health care $$$
If your income is at least 3 times your overhead you can get a head. Otherwise all you do is have a small margin between income v overhead.
Good presentation.... safe withdrawal rate = the dividend yield of the stocks you hold!
Thank you!
Plus half of last year's appreciation.
what if you need to pay for a nursing home
I literally take out all positive gains at the end of each month if it’s negative I hold
Any comment on the effect of RMD on a conventional IRA. Most people’s IRA have a 1% management fee. In other words 4 plus 1 equals 5% annual withdrawals.
There are several Vanguard and Fidelity low fee index funds. Way less than 1%.
Try Vanguard or another company to invest with very low fees.
that's why i'm here. i went researching safe rate of withdrawal on roth ira's vs ira's, as the balance will surely be lower if contribute less bc it's a roth to "offset" the loss of tax savings. that...and how does the 4% safe rate of withdrawal work with rmd's.
This only works if 'ceteris paribus' is presumed
If you invest in a mutual fund that on average makes 10% annually and I withdraw 8%, how will I run out of money?
Because the fund averages 10%, but has a wide range of annual returns. This is where the sequence of returns can have a big impact. For example, say you have a $500,000 portfolio and need $40,000 (8%) annually. In one year the return is -25%. In simple numbers, your portfolio is now $335,000 (less the 25% and the $40,000). Next year, your withdraw rate is 12% (40/335). Another bad year and it would be difficult to maintain enough for you over the years. Hope that helps.
@@tonyjones6421 Thank you. I see the possibility of a scenario like that happening to people but over the long term, 10 to 30 years of withdrawals, I would think the averages would favor most folks.
Yes we understand you wait for the climax of your answer to the end so everyone keeps listening to you say nothing. Just like a Politician
McCutchan
this video was before COVID-19 crisis. I don't know if some of those advices are still viable.
Still viable. S&P 500 up double digits this year. So if you withdrew 4% this year in monthly installments you would be ahead of the game even with this covid crisis believe it or not.
Never were viable. COVID only proves it.
i see retirement old folks who has a $400-$700 a month income living fine...no debts, no mortgage, no free spending out of control, no luxury vacation...live till death.
To Zarkon: You can retire in the Philippines for $300 U.S.D. A 2 bedroom apt. rents for $100/U.S.D. in Cebu, Philippines. The rest of the $300 goes for food,. utilities & transportation
@keekeemyfirstcat DAMN!! Do you only complain?
It sounds like you're ignoring SS contribution.
Stock market crashes and you said maybe I should of used an annuity
the beauty of annuities is: can you trust them? What if the company that provides the annuity goes broke. Then you have nothin!
@@danhoff1131 state insurance guaranty associations if pretty much every state, no? And if not, then another company will buy them, right?
or stock market crashes and you just wait for it to recover.