Home > Had CFP follow up meeting today

Had CFP follow up meeting today

November 19th, 2021 at 09:32 pm

Today was our follow up visit with our CFP. We saw him initially on 10/29 at which time we presented all of our information and discussed our plans and goals.

Today he reviewed the results of his analyses. He modeled several scenarios ranging from me retiring at 60 to retiring January 1, 2022. In all but one scenario, our projected success rate was 100%. In the one outlier, our success rate was "only" 99% so I think we could squeak by.

All of his projections assumed that I would have zero income after retirement, which isn't my plan. I anticipate dropping to per diem status and still working a few days per month for at least a few more years. At worst, if I work one weekend a month and nothing more, I'd earn at least $30,000/year. I also plan to do more online sales on ebay and Marketplace and have some money coming in that way, too. So his projections would look even better if you plug in that "post-retirement" income.

His projections also use a 4% rate of return from our portfolio. I certainly hope the long term return will be better than that. Even if it is 5%, that tips the scales even more in our favor.

Bottom line is that he thinks we're well positioned to succeed regardless of what I end up doing or when I end up retiring. I was pretty confident that that would be his conclusion, but it was nice to actually hear it stated.

I will be part time as of next Sunday, 11/28. I'm looking forward to seeing how that goes. I expect I'll find the work-life balance more to my liking and can stick with that for a while. Otherwise, we're set for me to cut back more if and when I decide it's time.


3 Responses to “Had CFP follow up meeting today”

  1. disneysteve Says:

    "One thing that doesn't seem to be accounted for in those projections is the ability to flex."
    That's true. It also assumes that your expenses remain the same (adjusted for inflation) year after year after year from the time you're 60 until you're 95, which is highly unlikely. In reality, most people tend to spend more in the early years of retirement and less as they get older, though other expenses may increase like medical care or household help.

    We also got a real-life example of that flex in 2020 when COVID hit. In 2019, our spending averaged about $7,000/month. In 2020, it dropped to under $6,000 since there was no travel, no dining out, no entertainment stuff like live theater, no casinos, etc. So we proved we could live on less if we needed to.

  2. rob62521 Says:

    Isn't that a wonderful feeling when you see all these projections? All that frugal living paid off!

    Before I retired, our financial guy did the same for me -- low balling what my pension would, and then what it might be, if I was eligible for the Early Retirement Option with the state. I didn't know until May if I would be eligible and I was planning on retiring in June. But he ran it both ways and the data showed we could make it either way because we are frugal.

    Hope the part-time schedule gives you a better sense of balance and enjoyment!

  3. Dido Says:

    Most planners use conservative rates when doing long-term projections, because one key is *long-term* rates, which will be much lower than what we've seen recently. The second key is *real* rate of return over inflation. The rate of return doesn't matter so much as the return over inflation. And you WANT the projection to be more conservative than reality. We generally project 3-4% above inflation over the long-term (most often 4% above inflation pre-retirement and 3% above inflation post-retirement).

    Having the extra income from per-diem work will help as well as the ability to adapt ("flex") to current conditions--both market conditions and your own changes in spending proclivity as you age. Those add to portfolio longevity. Combine that with a strategic Social Security claiming strategy and have a 3-year or so "bucket" of conservative investments to tide you over market downturns plus making sure that your asset *location* strategy is well-positioned. You are likely want to make use of strategic Roth conversions up to the top of your tax bracket after you reduce hours. Of course, that depends what that is, and what your expectations for tax rates over the long-term are. But from reduction of wage income to claiming of Social Security and Required Minimum Distributions (RMDs) from your IRAs is the "sweet spot" for putting yourself into a better tax situation for the post-RMD years.

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