That works for people who have "more than enough". In other words, spending $90K/yr won't be a problem and the issue is how much will be left to heirs.Here's how I see it, and you can let me know if you agree. I see the decision of "optimize for my own retirement" vs. "optimize for heirs" as tied to uncertainty over life expectancy.
Let's say someone retires at 65 and somehow knows they will live exactly another 20 years. I don't see how there is an optimize for self vs. heirs trade-off. This person should pick an after-tax income amount they want from their assets (say, $90k/year)....
Other people might flip the question to "We have $750K invested. What is the most we can safely spend per year and what is the best way to draw from our various accounts to achieve that?"
Yes, life expectancy plays a role but people asking that question, while they might care about leaving something to their kids (because that's generally human nature), probably care more about avoiding Alpo for dinner and heirs' concerns are secondary.
And yes, this is Bogleheads so there might be some "with $5 million invested, is $90K/yr really a safe amount" but I digress.
It's the people looking to maximize spending when that maximum will be closer to "needs" vs. "luxurious wants" I had in mind for "determining how to optimize "die with zero" (or thereabouts) for one's own retirement becomes a more likely topic."
Statistics: Posted by FiveK — Thu Jun 06, 2024 3:48 am — Replies 159 — Views 14861