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Old 03-05-2018, 17:47   #61
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Re: Planning cruising and savings

Most folks we know are getting off the boat at 70 and we know very few cruisers over 73-74. We have been living aboard and cruising the east coast and the Bahamas for almost 5 years now and it goes quickly! I can’t imagine why anyone would trade a little bit more SS against the possibility you could croak and go belly up by the time you collect any SS. The question of to go or not go is IMO completely different than when to collect social security. If you quit work and you need to stop and make some funds for a while, there are plenty of jobs available for all ages in touristy towns.

We have contributed enough into my social security that even if I work another 15 years my actual payout will only go up by a marginal $200 a month, or 36k over 15 years... most professionals can easily save that up over a few months... so why decide when to quit based on a marginal increase in social security payout?
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Old 04-05-2018, 08:36   #62
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Re: Planning cruising and savings

Great points zboss. Just had a high school buddy die (at 59) in his sleep of a cardiac related situation and he was in perfect health as we all thought. While the loss is sad it serves to remind of our own mortality. Since we don't know our end date or when we truly won't wake up one morning there is to me a risk reward factor to live our dream. If I run out of money in 10-15 years and have to live off of SS, whatever the amount but I will have seen many parts of the world from my boat. Well.....I think I am ok with that or of course sounds good now, right?
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Old 04-05-2018, 19:50   #63
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Planning cruising and savings

And... you won’t. You will find there are lots of ways to make money out there and it’s quite common to take a short break and work for a while, save up for that new sail and put away some money into the kitty. So what if you stop somewhere for 2/3 years and make some cash?

Who cares how everyone else does it... go live your life.
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Old 05-05-2018, 19:14   #64
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Re: Planning cruising and savings

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Great points zboss. Just had a high school buddy die (at 59) in his sleep of a cardiac related situation and he was in perfect health as we all thought. While the loss is sad it serves to remind of our own mortality. Since we don't know our end date or when we truly won't wake up one morning there is to me a risk reward factor to live our dream. If I run out of money in 10-15 years and have to live off of SS, whatever the amount but I will have seen many parts of the world from my boat. Well.....I think I am ok with that or of course sounds good now, right?
That is part of what drove us to leave when we did. Someone younger than Jim, a non-smoker, whom we had visited about 9 months previously, couldn't come to the phone. Jim asked the woman why not. She replied, "He's dying." Quite a shock it was, and the disease that did for him was lung cancer. He and his wife didn't get to go cruising.

As to your decision making, toss a coin. If you like the way the coin falls, do what it said. If you don't like it, you can see which way you're leaning, and you can investigate that. Either way, it is a win/win. Or, let your wife decide, if you're really on the hook. The chances are she has an opinion here, too.

Cheers, and good luck with it.

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Old 06-05-2018, 04:49   #65
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Re: Planning cruising and savings

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A few errors in your post. Medicare starts at age 65, independent of Social Security. Required minimum distributions start at 70 1/2.
You have to be on Social Security disability for two years before you can collect medicare if under 65 (or until you hit 65). That may be what he was thinking about.
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Old 06-05-2018, 10:17   #66
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Re: Planning cruising and savings

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You have to be on Social Security disability for two years before you can collect medicare if under 65 (or until you hit 65). That may be what he was thinking about.
I think you nailed it. My oversight. Unfortunately I had neck surgery go south at 61 and that was the case. So much for boating. Maybe I should be an advocate of just go but everybody's situation is different.
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Old 07-05-2018, 19:15   #67
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Re: Planning cruising and savings

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My question is how much of a cushion do you all feel comfortable with in the bank for backup, emergencies, future retirement etc.
If your funds are reasonably well invested, you can plan on withdrawing 20% a year half of the years over a long period of time maintaining the principle. That is, the size of your investment has to equal projected 10 year budget. You can get a good estimate of your future 10 year needs by looking at your previous 10 years. To further mitigate risk, have a 2 years worth of cash in addition to the above. Therefore, if you are planning to spend 25k a year, you need to have 300k total less whatever fixed income you will receive over the 10 year period. This, of course, does not account for the inflation, so at some point you will start reducing the principal if you want to maintain your spending in today’s currency valuation.
This estimate is rather concervative given current state of economy. You may be able to withdraw 25% a year half of the years, or 20% 6 years out of 10, or maybe even 25% 6 years out of 10, but that gets a little risky and will require bigger cash component to supplement an equity investment.
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Old 08-05-2018, 08:20   #68
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Re: Planning cruising and savings

Thanks LH. Your thoughts, and math do reflect the calculations reflected in my spreadsheet. I project to grow base principal by 5% annually as a conservative factor which year over year seems to work out ok. Of course this year not so much with our crazy stock market as it reacts to current affairs and unstable government situation. What seems to make the most sense as I have tuned up my forecast is to continue working through 2019 banking as much cash as possible and live on the cash postponing getting SS until it is really needed. Especially my SS if left to mature will provide the greatest benefit post cruising.
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Old 08-05-2018, 09:04   #69
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Re: Planning cruising and savings

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Thanks LH. Your thoughts, and math do reflect the calculations reflected in my spreadsheet. I project to grow base principal by 5% annually as a conservative factor which year over year seems to work out ok. Of course this year not so much with our crazy stock market as it reacts to current affairs and unstable government situation. What seems to make the most sense as I have tuned up my forecast is to continue working through 2019 banking as much cash as possible and live on the cash postponing getting SS until it is really needed. Especially my SS if left to mature will provide the greatest benefit post cruising.
I'm not sure that 5% is going to outrun inflation by much. Published inflation figure seem to include items not relevant to the average joe on the street?
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Old 08-05-2018, 09:58   #70
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Re: Planning cruising and savings

Based on your guys numbers, I guess I’m way conservative.
I’m currently withdrawing about 4% , but do have an eventual big purchase coming, Cruising will one day come to an end, and we will have to live in a house.
Will have to see them if buying or renting is the most logical.
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Old 08-05-2018, 09:59   #71
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Planning cruising and savings

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I'm not sure that 5% is going to outrun inflation by much. Published inflation figure seem to include items not relevant to the average joe on the street?


I think 5% is his planning number, to me that is a good, conservative number.
Yes I believe it will be better, but best to plan so that is the unforeseen happens, your still OK.

In my opinion, planning on withdrawing 20% to 25% per year isn’t realistic, I don’t think historical data supports that, but do think what is going on now may not have a historical basis, meaning maybe what is going on now is unprecedented.
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Old 08-05-2018, 10:59   #72
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Re: Planning cruising and savings

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I think 5% is his planning number, to me that is a good, conservative number.
Yes I believe it will be better, but best to plan so that is the unforeseen happens, your still OK.

In my opinion, planning on withdrawing 20% to 25% per year isn’t realistic, I don’t think historical data supports that, but do think what is going on now may not have a historical basis, meaning maybe what is going on now is unprecedented.
I believe 20 to 25% is Ludacris unless you have one hell of a lot of money or don't plan on living long. Even at having wads of money the arithmetic is the same. It is only sustainable if what's coming in at least matches what's going out. Maybe I misread that 20/25?
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Old 08-05-2018, 15:21   #73
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Re: Planning cruising and savings

Agreed which is why using a conservative estimate at 5% is realistic considering my investments over the last couple of years have been about in the high 7% range. Prefer conservative. No idea who can afford to withdraw 20-25% or where that allocation came from
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Old 08-05-2018, 17:23   #74
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Re: Planning cruising and savings

I guess I am looking at this the other way, 30 yrs old, married, 2 kiddos (1yr old and 6 yr old), wife has a fantastic job that makes twice what I make that can easily sustain a cruising savings if/when I quit... (I have a great job with great benefits btw)

And I cannot wait to go.

My dad watched the ocean for his perfect time. He waited 32 years inside an automotive factory massing wealth and never left due to health issues. He is haunted by that lost dream every day of his life.

You just have to weigh your risks. Some of the best, craziest decisions you ever made were when you were younger and impulsive. You now have the advantage of wisdom that you didn't have when you were younger!

For me, I plan to retire at 35 and liveaboard with the wife building up savings for adventures six months out of the year. Homeschooling the kids and giving them the life that I missed...

I might miss out on a few bucks in my retirement years, but the life lessons for my kids and living in the moment is well worth it! Who knows, I might even pass away before I reach 40! I wouldn't miss that money anyways!!!
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Old 08-05-2018, 17:32   #75
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Re: Planning cruising and savings

Very good discussion! It seems that everyone has a different situation, and I enjoy hearing everyone's take on this. There does seem to be a theme here, though...

The way I see it, there is a judgement call to make when we compare time versus money. Running out of money in old age COULD happen. We can plan to prevent this, and we can guess pretty well at the end date for money. That is, of course, a very popular warning in advertising for investment firms. But.. running out of healthy sailing days WILL happen. We cannot prevent this.

Nobody really advertises this TIME warning, so I have collected a few lines of wisdom from this thread. You know- just to balance all those cute ads where the random people try to estimate how much MONEY they will need in retirement, then are shocked to find that it is probably not enough. I contend that TIME should get similar attention, but there's just no money in it...

JPA Cate:
the longer you wait, the more likely you are to get blindsided by a major health event.
butterchurn:
my wife already is retired. She now has major back issues and is in constant pain. No long term cruising for us.
a64pilot:
Most wait until it’s too late really, and seriously curtail their plans based on age and infirmities. I have yet to meet someone who said they should have waited, so it seems that on average most wait either long enough or too long.
hamburking:
The true currency of sailing is good health, not money.
Too many of us wait till our pile is really big...then never get to go.
jimp1234:
there are times I think I've waited too long. I'm still in very good health, but I'm no longer "strong like bull" like when I was younger.
zboss:
Most folks we know are getting off the boat at 70 and we know very few cruisers over 73-74.
Captain Randy:
Just had a high school buddy die (at 59) in his sleep of a cardiac related situation and he was in perfect health as we all thought
JPA Cate:
the disease that did for him was lung cancer. He and his wife didn't get to go cruising.
Cadence:
Unfortunately I had neck surgery go south at 61 and that was the case. So much for boating.
Homeward13:
My dad watched the ocean for his perfect time. He waited 32 years inside an automotive factory massing wealth and never left due to health issues. He is haunted by that lost dream every day of his life.
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