tag:blogger.com,1999:blog-5465015914589377788.post2329375676279280270..comments2022-11-24T11:36:59.920-05:00Comments on Michael James on Money: Working Out Your Retirement Magic NumberMichael Jameshttp://www.blogger.com/profile/10362529610470788243noreply@blogger.comBlogger8125tag:blogger.com,1999:blog-5465015914589377788.post-45609967058041425992021-01-22T11:46:26.332-05:002021-01-22T11:46:26.332-05:00Hi Kim,
I'm glad you're getting use from ...Hi Kim,<br /><br />I'm glad you're getting use from the spreadsheet and are enjoying the blog. The Retirement Magic Number includes the amount in the HISA.Michael Jameshttps://www.blogger.com/profile/10362529610470788243noreply@blogger.comtag:blogger.com,1999:blog-5465015914589377788.post-24932935347371342502021-01-22T10:43:46.489-05:002021-01-22T10:43:46.489-05:00Hi. I've been playing with your Withdrawal Rat...Hi. I've been playing with your Withdrawal Rates/Retirement Magic Number spreadsheet. One question: does the "Retirement Magic Number" include or exclude the amount in the HISA?<br />I really appreciate your blog and the work you do to help others. <br />Thx, KimJ. K. Reidhttps://www.blogger.com/profile/08317011797173393679noreply@blogger.comtag:blogger.com,1999:blog-5465015914589377788.post-15549025602899655522014-02-08T16:09:49.082-05:002014-02-08T16:09:49.082-05:00@Anonymous: You're absolutely right. It'...@Anonymous: You're absolutely right. It's fixed now.Michael Jameshttps://www.blogger.com/profile/10362529610470788243noreply@blogger.comtag:blogger.com,1999:blog-5465015914589377788.post-67180968481626309302014-02-08T13:07:07.034-05:002014-02-08T13:07:07.034-05:00Hi, thanks for a helpful article. If I understand ...Hi, thanks for a helpful article. If I understand your intent correctly, you may have an error in the calculation for increased capital to make up for $2,000 per month shortfall between 55-65. I think you used a yearly interest rate but monthly draw in your PV calculation.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-5465015914589377788.post-60892363953408030782014-02-03T19:13:13.230-05:002014-02-03T19:13:13.230-05:00@Mark: Taking inflation into account properly puts...@Mark: Taking inflation into account properly puts you ahead of many investors. Using a 3.5% withdrawal rate to start is quite reasonable. As some of the stocks don't perform up to standard over the years, you'll have room to dig into the capital portion of your portfolio.Michael Jameshttps://www.blogger.com/profile/10362529610470788243noreply@blogger.comtag:blogger.com,1999:blog-5465015914589377788.post-19795843110932026712014-02-03T18:43:35.894-05:002014-02-03T18:43:35.894-05:00I personally like a 'go-forward' approach,...I personally like a 'go-forward' approach, determine what your spending might be in retirement and build the model forward. <br /><br />In a few posts on my site, last year, I stated $4,500 (or $54,000) in after tax money is needed to retire in 2013 dollars.<br /><br />This is assuming I have no mortgage payment or any RRSP contributions during retirement.<br /><br />Factoring in an inflation rate of 2% between now and over the next 17 years, just for fun, that makes 2030 as my first full year of retirement and that $54,000 really costs about $73,000 in the future. <br /><br />I figure I need capital of around $2 M spinning off 3.5% dividends and distributions to cover those expenses. Capital gains should cover inflation, but then again, who really knows.<br /><br />I'm not sure I could live off of $2,000 per month. In another 20+ years, there is no way I could.<br /><br />Good work with the spreadsheet, I'm sure it will help people.<br /><br />MarkMy Own Advisorhttp://www.myownadvisor.canoreply@blogger.comtag:blogger.com,1999:blog-5465015914589377788.post-24980492155029885932014-02-03T10:11:51.448-05:002014-02-03T10:11:51.448-05:00@Greg: The withdrawal rate starts in the 3-4% rang...@Greg: The withdrawal rate starts in the 3-4% range, but increases with age. For someone who wants to maintain portfolio purchasing power all the way to death, a different plan is needed.<br /><br />It would be easy to add what you're asking for to the first page of the spreadsheet; just multiply portfolio size by the percentage beside your retirement age. I may add this at some point, but for now it's left as an exercise for the reader :-)Michael Jameshttps://www.blogger.com/profile/10362529610470788243noreply@blogger.comtag:blogger.com,1999:blog-5465015914589377788.post-8943487462078492132014-02-03T09:55:11.767-05:002014-02-03T09:55:11.767-05:00Nice addition to your spreadsheet Michael. I don&...Nice addition to your spreadsheet Michael. I don't see any problems with your spreadsheet, I think it models your candidate retirement strategy nicely. It backs up and provides a more detailed foundation for a safe withdrawal rate of 3-4% <br /><br />A nice addition would be the ability to do the reverse calculation- plug in portfolio size and see what your spending could be if you had that much saved. I like to think about if I could live on my current savings if I didn't do any paid work. Gregnoreply@blogger.com