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Welcome to this session of grand rounds, a collection of posts I have discovered in the blogosphere and have found of interest and hope you do too.

This offering of Grand Rounds looks at articles from around the web that deal with issues of retirement.

 

 

 

I think the biggest goal of retirement planning is that you have enough money to support you throughout your golden years so you “don’t die broke” or become a financial burden to your children.

Therefore it is not what the ceiling of what you can earn in retirement that matters most, but the floor.

No matter how the economy is doing, if you have a stable income floor you can rely on you can weather any storm and not lose any sleep.

Wealthy Doc has a treat for us, presenting a guest post of David Graham, aka FI Physician (who happened to also grace this site with another wonderful guest post).

David addresses various strategies you can implement to indeed raise your income floor and provide a happier and more stable retirement in, “Retirement Income Expert Tools To Avoid Poverty.”

 

 

The future is unknown.

As much as we like to plan and plan and plan, when your true life’s path unfolds it rarely sticks to the game plan.

This is perhaps the most challenging part of the financial independence community, figuring out a financial plan that will give you the best chance of portfolio survival.

I personally have taken a more conservative approach when trying to factor a “safe withdrawal rate (SWR)” to use.

The 4% rule (or 25x your annual spend rate) goal for me did not give enough margin of safety as it was formulated for a 30 year drawdown period and was also created during a different time in the economy.

I have been hovering around the 3.25%-3.5% SWR as my personal compromise for a longer retirement period (likely 40-50 years), but I had no data to back this up.

Fortunately FI Physician, does a wonderful analysis on portfolio survivability in longer retirements in, “Does A 4% Withdrawal Rate Survive FIRE?”

 

 

 

 

There are various spend down methods a retiree can employ that help stabilize income while protecting you from the dreaded sequence of return risk (SORR).

It is important to know what assets should be used and what should be avoided if you happen to find yourself in a down market and do not want to lock in these losses by being forced to sell low.

FI Physician, discusses how creating buffers to avoid this scenario can help to avoid this undesirable situation in, “Buffer Assets, Bucket Plans, And Sequence Of Return Risk.”

 

 

In retirement, dollars are quite valuable.

While you are working you can bail yourself out of financial mistakes by continuing to garner income by working.

That option is likely off the table once you truly reach your golden years.

The margin for making mistakes is therefore much smaller once your work income has dried up.

It is therefore vital to find ways of stretching that dollar as far as you can.

No, I do not mean you will be forced to eat cat food during your golden years.

Rather, a more palatable option would be retaining as many dollars as you can by not turning them over to Uncle Sam.

At the risk of making this Grand Rounds purely a showcase of the intellectual prowess of David Graham and his prolific guest posting, the final article worthy of perusing is his guest post on White Coat Investor titled “How To Optimize Your Money During Retirement.”

 

Most of us have heard of the dreaded sequence of return risk (SORR) in which your nest egg is most at risk after you retire.

If the stock markets crash within the first few years of retirement, the theory is that your portfolio takes a significant early hit that you might not ever be able to recover from.

So how have those unlucky past retirees fared when they were hit with a bad SORR?

Go Curry Cracker (I tried searching for any byline for David Graham to no avail) does all the leg work and lays it out for you in, “How Are The 2000 And 2008 Retirees Doing?”

 

 

 

Hope you enjoyed the reading material.

Have a great rest of the week.

 

 

Note:

If you are in search of financial help, please consider enlisting the service of any of the sponsors of this blog who I feel are part of the “good guys and gals of finance.”

Even a steadfast DIY’er can sometimes gain benefit from the occasional professional input.