In this episode, we break down exactly how much you need to retire early. What is ‘enough’? We explore the famous 4% rule, where it came from, and whether it’s still a reliable rule of thumb.
We also explain how to live off your assets in practice, other considerations like home ownership and property investments, as well as how to approach financial planning with flexibility and common sense.
This is our last episode for 2020. We’re taking one fortnight off, and we’ll be back with the goods in January! Thanks for listening and for your support this year 😀
(you can also download the mp3 file here)
- How do we figure out how much we need to retire? (02:51)
- The famous 4% rule – what is it and how does it work? (06:42)
- Arguments for and against the 4% rule working in the future (09:23)
- What level of wealth is enough for you? Dollar-figure examples (14:56)
- How did Pat and Dave decide on their FI number? (16:42)
- Living off your assets – how it works in practice (21:32)
- Selling shares without running out of money (26:00)
- Dealing with downturns and a bad patch of returns (30:24)
- Other things to consider (36:58)
- Why you might need more money and the 4% rule won’t work (42:22)
- Takeaways (47:46)
- The Creator of the 4% Rule, Bill Bengen
- Credit Suisse Yearbook (research of 120 years of returns) – Summary and Complete Yearbook PDF.
- Vanguard Article on Safe Withdrawal Rates and Spending Flexibility
- Semi-Retirement – Your Shortcut to Freedom?
- Financial Independence Backup Plans – Part One and Part Two
- Big ERN – Safe Withdrawal Rate Series
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Want more FIRE & Chill?
We’ve covered a range of topics so far. Check out the complete list of episodes on the FIRE and Chill podcast page.
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