Contemplating Retirement

I’m thinking of retiring early-2023. Then, this happened:

S&P 500
4304.76 on 2/22/2022
4796.56 on 1/3/2022
4304.76/4796.56 = 0.8975 < 0.9
We just entered a correction, right?

The annual inflation rate for the United States is 7.5% for the 12 months ended January 2022

Russia invading Ukraine could mean war in Europe.

Wow! Just, wow! Anybody retire before/during bad times have any advice or a success story?

I need to buy another set of tires, too!


@MSQUARED48 Oof :sweat_smile:

@Latexman , I’d say you still have time to see which way it swings, but I myself have the benefit (or horribly bleak outlook of working for the rest of my life, depending on how you look at it) of a lot of time before I’m worrying about this.

A correction is unpleasant, but a good thing as I see it. It means the market is acting sensibly rather than going wild. As long as your investments are properly balanced, you should be able to weather fluctuations barring a complete crash; in which case we’re all screwed.

I “retired” w/in the last year and have observed 2021 gains already disappear in 2022.

Realistically, only you can make the retirement decision.

In the past year, on several occasions i have met with a financial advisor whom has modeled my financial situation and has convinced me that my situation is still good, despite the 2022 losses. However, i will need to make some changes to be more less risky. Interestingly, i just got home from visiting with the financial advisor today.

Examine your expenses and income and then have an analysis done. I did visit with 2 different financial advisors shortly before retiring with 1 assessment being “financial situation is ok provided no sudden or drastic changes” to “being in good shape”. I’ve also been told that many folks simply do not plan at all or are not aware of their financial retirement situation (this really surprised me).

Regarding the financial advisor, seek individuals that will discuss your situation w/out a fee (i.e. initial consultation is no fee). Bring your list of expenses and income.

Fyi, i have kept track of my yearly expenses the last 13-years which helped me/advisor plan the model.

Yes, the market is not looking too good lately and i could not tell you what will happen. if your invested in the market, suggest you have a market risk done (simple questions) to assess your risk tolerance. this will help you in determining how best to invest/spend while in retirement.

wish you good luck and i, as does my advisor, completely understand the uncertainty. but having that advisor that you know and trust goes a long way to resolving those unsettling matters and allows you to rest, relax, and sleep well at night.

I had a one hour consult with 3 financial advisors. Two were borderline useless. As for the current fun and games, I’ve got 250000 beer vouchers in dry powder and am ready to pull the trigger. I may even reactivate the margin loan.

@MSQUARED48 In another bout of unlucky timing, I re-tired my wife’s van, my Camry, and our son’s CRV last year. All in a 1-2 month period. Bad news - a $2500 hit; good news - no more tires for a while.

@SuperSalad Time heals all wounds, but it doesn’t erase the scars.

It’s what comes after the correction that worries me the most.

My assett allocation target is 60% equities / 40% bonds and cash. I re-balance when it gets about 3-5% off that. I am mainly into low expense index funds, but I do have one high dividend (~8%) ETF. I lean heavily in the Boglehead direction, but do stray a little if I feel the urge. What about you?

I did very well in 2020 with the COVID crash and recovery.

@pmover “I love it when a plan comes together” - Hannibal Smith. You sound a lot like me, or vice versa. I am mainly self-taught on investing. Over the years I have spoken with several financial advisors, some several times; one many times, they were persistent. I just could never convince my frugal self to work with them. Most wanted a fee of about 1% of assets under management. If the “4% rule” is used when withdrawing in retirement, I couldn’t stomache giving them 25% of the cut. About 14 years ago I earned a free advisor at Fidelity. They call it Premium Services. In that 14 years, I’ve had two different advisors. Both were excellent. We have fine tuned and tweaked Fidelity’s retirement planner with all the data in my plan. So far, my plan looks great. As you said, it’s the uncertainty. I will maintain the course though!

As a double check, I use FIRECalc a good bit. It says I’m good to go too.

I’ve also honed my SS claiming stratedgy with opensocialsecurity too. SWMBO’s family is long lived, longer than mine, so I lean heavily towards her being well provided for after my planning period is over.

@Latexman, I am all over the place with my investments. I’ve started having some semblance of order and planning come into being over the past 2 years. The 2020 crash and boom were sort of absurdly good for me. I never expected the level of gains I had between March and December of 2020 and I made the most of it.

Those gains allowed me to get a jump start on some of my longer term plans. I put a large portion of those gains into REITs, mutual funds, and larger corporate equities that I’d had my eye on for the long term.

I’ve been pulling my hair out over the past few months, but I keep reminding myself that I am still probably around +40% from where I was at the beginning of 2020 even with this downturn and that makes this hurt sting much less.

@GregLocock A market timer! I’ve been there and done that. I even got real lucky once on company stock. It was the Dow Chemical/Kuwait fiasco of 2008. My entire 401k was in cash (Fixed Fund Account), I waited until the stock was < $10/share, and I swung my whole account. I sold a couple years later after most of the dust had settled at > $40/share. I’m not greedy; I was happy with that 4%. :wink:

Btw, that’s how I got the free Fidelity advisor.

Good luck to you!

@SuperSalad Wonderful, wonderful!

The stock market has always recovered. Just have enough bonds and cash to ride out the bear (~ 3 years), buy low as stocks go down, and sell high as stocks go up. I’m no longer a market timer; I’m too close to retirement. I rebalance to my asset allocation within 5% bands. But you, young man, could take bigger risks than me and try to time it. You have time on your side. Be patient and good luck!

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Not really a timer, more buy and hold, and the occasional speccy. One of my bigger disasters was bought out last year so I was suddenly left with a large capital loss and rather a lot of capital, which I still haven’t really found a home for. I should have just chucked it into an ETF while I was thinking.


Interesting in that my financial advisor used Fidelity for several years and did well despite experiencing two different advisors. He had a 1-hour session with a different financial advisor and decided to change simply from the standpoint of wanting that face-to-face communication. While in his 50s, he departed his employer, underwent a career change, and is now a financial advisor. he is really happy these days!

Yeah, they want a percentage, but after yesterdays discussion, i asked myself if i wanted to spend 1% of investments for his services. i told him that retired people do not like spending $; we both laughed. Although my decision is not final, the question for me is do i want to continue on my own or pay someone to provide some level of expertise. is it worth paying $250-500 bucks/year for a little peace of mind and minimizing my financial risk?

thanks for the links.

i went thru firecalc with similar results. whew, increases the confidence level a little bit!

ssa: well, i’ve not applied yet & im dreading that one, but i shall conquer!

for me, i got burned 20+ years ago and learned my lesson. long story short, i bought enron stock. saw it increase 20% and was going to sell. while enroute to the office to sell, i had a brief discussion with a long-termed enron engineer and he told me stock price was predicted to hit $100/sh. yep, i did not sell and lost it all. Since then, i have gotten some good advice and maintained conservative investments.

i got lucky with some stock purchases during mid 2020 and sold in late 2021; ~100% return on one stock (oil processor) and ~30% return on the other (airline). just sold another with 5% return. i have 1 left, but that one is doing so bad now, i’m not sure what to do. im quitting buying stocks. on 3/20/2020, there was a significant decrease in several industries. this was the time to buy those stocks and i did (a little late, but still did well).

in early 2000s, i had investments with several firms. around 2005, one financial services company did absolutely nothing for ~10-yrs. definite poor communication and i made the change in 2015ish. at that time, my employer 401k administrator was doing really well and offered good services. so, i consolidated all investments with them and have been pleased ever since. i did not like having to correspond with different firms and try to keep up to date. the statements and paperwork was a little overwhelming, not to mention getting taxes done. consolidating was so relieving and easier to handle.

gentlemen, wish you all good luck and this topic is worthy of sharing experiences, etc.

retirement is definitely a brave new world!! plan and prepare is your best solution.

@pmover On SSA, I highly recommend Get What’s Yours: The Secrets to Maxing Out Your Social Security by Kotlikoff, Moeller, and Solman. I picked up a used book for < $5.

I haven’t done it, because opensocialsecirity is free, but Kotlikoff has a website and software which recommends an optimum SS claiming strategy for $40/year.

Of course, to get to an optimum SS claiming strategy, one has to estimate when they and their spouse will die. Kinda morbid, but . . .

Yeah, I like FIRECalc a lot. Knowing your personal plan would have survived “121 possible 30 year periods in the available data” definitely builds your confidence.

Enron, sad story. I worked in Texas 2006-2010. I met several Enron casualties there. They were good folks who got a raw deal.

In my plan later on, I may need to get a financial advisor (FA) for after my planning period. It depends on SWMBO, or if I think one of our 5 kids can manage it. But, in the past and currently, SWMBO has had no interest in our finances. Once I retire, I need to progress this part of the plan so it’s well documented for whoever takes over when I kick the bucket.

My bad beginning was a novel engine company (red lights flashing!) Orbital based in Western Australia. They had a real project, and I have actually driven one of their engines, and so far as I know they are now doing a reasonable business, 25 years later. Anyway, I bought in, price dropped, I bought some more, price dropped, I chased them down. Damn here I was sitting on a huge paper loss. Luckily the contract that had caused all the shennigans came to fruition and I gratefully sold for a tiny net profit.

I have bought speccys since, had an 8 bagger 3 years ago, but DCA should be called throwing good money after bad. And i don’t touch engineering companies.

Oof. I joined a startup with similar wild claims…hoping for stock options and big gains. Thankfully never got to that point before we parted ways.

I have done some spec stuff, never panned out. What has panned out was looking at market trends for basic extraction/mining companies based on what we were seeing in commodity pricing, and then looking for places with low P/E ratios, etc. etc. And that lasts until they get bought out…then you cash out and get your meager gains while looking for the next trend. And eventually, you chuck it in because you’re too busy on the latest project, and find a decent manager to do it for you.

I can recall chatting with you about this before, Latex. We were lucky to find a lawyer that handled estate trusts, and planning. Finding somebody to be your executor, and that you trust to handle financial matters competently, is a key, especially for us men who expect to have our spouses outlast us, is important.

We are lucky to have found a manager we trust, and who helps our sons with their financial advice, for pro bono, because he knows he is also on the list of trusted managers for our executors to consult.

On the analysis end, there are lots of FIRE sites that have tools for doing your own analysis, including some with Monte Carlo simulations using historical equities values to get more “realistic” simulations. Some analysts only use “average” returns, which don’t adequately account for “sequence risks,” which are are multiple years of bad returns, as a real market might have. This is one site SWR Series Part 48. Nevertheless, if you’re comfortable with your assets/debts and comfortable with retiring, you should probably do so; there are things that you might have put off doing because of job or kids, and it’s likely not going to get any easier to do that Machu Picchu hike in the future. Certainly, doing the numbers vis-a-vis net worth, expenses, safe withdrawal rate (the SWR title in the above link), etc., is required, but is there really a “right” time to do anything of import? The opposite side of that coin is paralysis by analysis.

I’m planning on retiring around the end of the year, and I’ve done pretty much everything I could have to build up the nest egg, and it’s now time to enjoy the fruit of that labor.

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@IRStuff Congrats on a successful accumulation phase! I hope your plan comes together!

I’m comfortable with my three legged stool (pension, nest egg, and SS filing strategy). I could retire now if I wanted, but I’m not ready yet, and I have two things I want to see through before entering the decumulation phase. This is our youngest’s senior year at college. I’m cash flowing that using their interest free payment plan. Then, my 3 siblings and I should close on the sale of our family farm/estate this year. With those two things out of the way, my retirement should be bulletproof. Then, I should sleep good at night while I figure out the next phase.

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@Latexman Congrats, you sound like you’re at least close.

Similar 3-legged, but nest egg is the largest component, by far :rage: Both kids are out on their own, so just need to sell one house and move back to original house. I don’t know that I’d ever feel completely at peace with the funding vs. spending, since you can ALWAYS outspend whatever the funding looks like; we’re watching this reality TV episode of Below Decks and, “That looks cool; I wonder how much chartering that “boat” would be?” “Oh, only 195,000 euros/wk? So, maybe when we’re in our 80s and the nest egg has grown as expected?”


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