Gyroscopic Investing

Might be worth reading.

https://www.thinkadvisor.com/2019/07/18 ... _term=tadv

I'm already retired so this advice won't do me any good but I have mostly followed this strategy to get where I am (just got my first SS check 10 days ago delaying to age 70 and it was almost the max amount you can get).

One suggestion I would add is to start living on the budget you plan to have in retirement long before you actually do retire. That way your spending habits will already be deeply ingrained and you won't have to make significant adjustments - plus if you're making a lot more than your budget calls for you can stash the rest away. We were living on about 1/2 of our income about 10 years before I actually retired and putting the rest away.

jacksonM wrote: ↑Sat Jul 20, 2019 2:15 pm I'm already retired so this advice won't do me any good but I have mostly followed this strategy to get where I am (just got my first SS check 10 days ago delaying to age 70 and it was almost the max amount you can get).

One suggestion I would add is to start living on the budget you plan to have in retirement long before you actually do retire. That way your spending habits will already be deeply ingrained and you won't have to make significant adjustments - plus if you're making a lot more than your budget calls for you can stash the rest away. We were living on about 1/2 of our income about 10 years before I actually retired and putting the rest away.

I didn't wait until 70 because I was unemployed at age 62 and didn't want to dip into my savings as fast as would have been required had I not taken SS.

I effectively waited until 66 because I later got a couple of jobs that paid too much for me to collect SS for four years.

However, given the makeup of my savings, I'm probably at least as well off now as I would have been by waiting until 70, due to having reduced my burn rate by taking SS.

Libertarian666 wrote: ↑Sat Jul 20, 2019 3:27 pm

jacksonM wrote: ↑Sat Jul 20, 2019 2:15 pm I'm already retired so this advice won't do me any good but I have mostly followed this strategy to get where I am (just got my first SS check 10 days ago delaying to age 70 and it was almost the max amount you can get).

One suggestion I would add is to start living on the budget you plan to have in retirement long before you actually do retire. That way your spending habits will already be deeply ingrained and you won't have to make significant adjustments - plus if you're making a lot more than your budget calls for you can stash the rest away. We were living on about 1/2 of our income about 10 years before I actually retired and putting the rest away.

I didn't wait until 70 because I was unemployed at age 62 and didn't want to dip into my savings as fast as would have been required had I not taken SS.

I effectively waited until 66 because I later got a couple of jobs that paid too much for me to collect SS for four years.

However, given the makeup of my savings, I'm probably at least as well off now as I would have been by waiting until 70, due to having reduced my burn rate by taking SS.

I made plans for the "bridge" to delaying SS to 70 after I retired by stocking away cash in T-Bills.

As it turned out, I didn't have to tap into very much of it because it really helped that my wife is younger and wants to keep working. Her pay checks would have actually been enough to pay all the bills if it hadn't been for her 401k contributions which we maxed out. I figured it would be better in the long run to go ahead and max out her contributions and tap into the cash reserve to make up the shortfall. Turns out we still had a positive cash flow after my retirement, mostly, I think, because of my other idea to try to emulate your spending in retirement before you get there. And we haven't really had to sacrifice much to do that. The budget still included $10k for travel expense which is something we both like to do. We have in common that we would both rather do that than buy whatever fancy thing we might like that we don't really need - and having money put away to continue doing that.

jacksonM wrote: ↑Sat Jul 20, 2019 3:51 pm

Libertarian666 wrote: ↑Sat Jul 20, 2019 3:27 pm

jacksonM wrote: ↑Sat Jul 20, 2019 2:15 pm I'm already retired so this advice won't do me any good but I have mostly followed this strategy to get where I am (just got my first SS check 10 days ago delaying to age 70 and it was almost the max amount you can get).

One suggestion I would add is to start living on the budget you plan to have in retirement long before you actually do retire. That way your spending habits will already be deeply ingrained and you won't have to make significant adjustments - plus if you're making a lot more than your budget calls for you can stash the rest away. We were living on about 1/2 of our income about 10 years before I actually retired and putting the rest away.

I didn't wait until 70 because I was unemployed at age 62 and didn't want to dip into my savings as fast as would have been required had I not taken SS.

I effectively waited until 66 because I later got a couple of jobs that paid too much for me to collect SS for four years.

However, given the makeup of my savings, I'm probably at least as well off now as I would have been by waiting until 70, due to having reduced my burn rate by taking SS.

I made plans for the "bridge" to delaying SS to 70 after I retired by stocking away cash in T-Bills.

As it turned out, I didn't have to tap into very much of it because it really helped that my wife is younger and wants to keep working. Her pay checks would have actually been enough to pay all the bills if it hadn't been for her 401k contributions which we maxed out. I figured it would be better in the long run to go ahead and max out her contributions and tap into the cash reserve to make up the shortfall. Turns out we still had a positive cash flow after my retirement, mostly, I think, because of my other idea to try to emulate your spending in retirement before you get there. And we haven't really had to sacrifice much to do that. The budget still included $10k for travel expense which is something we both like to do. We have in common that we would both rather do that than buy whatever fancy thing we might like that we don't really need - and having money put away to continue doing that.

Aren't you going to be in a really high tax bracket when you both have to take RMDs?

Libertarian666 wrote: ↑Sat Jul 20, 2019 9:07 pm

jacksonM wrote: ↑Sat Jul 20, 2019 3:51 pm

Libertarian666 wrote: ↑Sat Jul 20, 2019 3:27 pm

I didn't wait until 70 because I was unemployed at age 62 and didn't want to dip into my savings as fast as would have been required had I not taken SS.

I effectively waited until 66 because I later got a couple of jobs that paid too much for me to collect SS for four years.

However, given the makeup of my savings, I'm probably at least as well off now as I would have been by waiting until 70, due to having reduced my burn rate by taking SS.

I made plans for the "bridge" to delaying SS to 70 after I retired by stocking away cash in T-Bills.

As it turned out, I didn't have to tap into very much of it because it really helped that my wife is younger and wants to keep working. Her pay checks would have actually been enough to pay all the bills if it hadn't been for her 401k contributions which we maxed out. I figured it would be better in the long run to go ahead and max out her contributions and tap into the cash reserve to make up the shortfall. Turns out we still had a positive cash flow after my retirement, mostly, I think, because of my other idea to try to emulate your spending in retirement before you get there. And we haven't really had to sacrifice much to do that. The budget still included $10k for travel expense which is something we both like to do. We have in common that we would both rather do that than buy whatever fancy thing we might like that we don't really need - and having money put away to continue doing that.

Aren't you going to be in a really high tax bracket when you both have to take RMDs?

I'll be 87 when that time comes, or possibly even 92 if the Secure Act raises the age to 75, so I'm not going to worry about it.

More worried about what's happening this year at age 70 with starting SS + starting RMD + wife still working and making about $75k. I haven't calculated it yet but I think my entire RMD is going to go toward paying the taxes. At least I got my wife to quit the part time job she was working for extra income so we don't have to give it all to the government. Also maxing out her 401k but beyond that I don't see anything I can do to avoid the taxman this year.

Tell us how you managed to marry someone 17 years younger than yourself! It must be an interesting story.

ochotona wrote: ↑Mon Jul 22, 2019 11:58 am Tell us how you managed to marry someone 17 years younger than yourself! It must be an interesting story.

Well, one reason I married a much younger woman is because when you are a 55 year old widower looking for both a wife and mother for your 4-year-old adopted granddaughter the pool of women your age to choose from is very small - at least in the USA.

I found my wife online on a website called "Cherry Blossoms" - she was 38 at the time. Interestingly, she was the very first foreign woman I talked to.

So she came over as a 90-day-fiance. If you've ever watched the "reality" TV show of the same name you might have gotten the impression that these kinds of marriages are a disaster waiting to happen but the truth is entirely different. They actually have a lower divorce rate than domestic marriages. We've been married almost 15 years and we're friends with lots of other couples with the same story.

When I first got married I had no idea my wife was going to be able to contribute to the household finances the way she has. She had gotten a bachelor's degree in medical technology but had never been able to find work in that field so had only been a maid in Hong Kong and an assembly line worker in Taiwan. After being in the U.S.A. for a couple of years she decided to study and take the test to be a licensed medical technologist. After failing it the first time she studied and took it again and passed. Now she has an advanced license that allows her to perform all kinds of tests that a lot of the medical technologists in the U.S.A. aren't allowed to do.

She's 53 now herself and wants to work until 60. The 4% SWR on the portfolio + my nearly max SS check would put us right on what has been our yearly budget already so I'm hoping she'll be able to retire even earlier if she wants to.

Edit: And another advantage of marrying a woman 15 or more years younger is that your RMD's are lower.

Very heartwarming story!