Our town doing the same thing. Also encouraging higher density building. I think the hope is that with more density there will be be more use of buses, biking, walking, carpooling. I think it will be a mixed bag and envision some neighborhoods with car overload,
There is quite a bit of speculation in your post. I follow most of the FIRE blogs/communities and have not seen most being comfortable with an 80% probability. The advice at that risk level is typically to work a few more years.
I’ve been planning an early retirement before I even heard of the FIRE movement, since I started my career actually. I feel very comfortable with my numbers and plan to retire in a few years (I’ll be under 50). The Monte Carlo sims give me a 100% chance of success and my wealth manager confirmed. I fired him after that to save on fees and start managing my own money (had I gone it alone from the start, I could have retired 2 or more years sooner, alas). I’m planning a 5%ile annual ”income” with no debt, approximately 55% of my budget going to travel, and annual gift near the max to my DD. It’s an upper middle class retirement with some luxury travel but mostly mid-level travel (I’ve never flown business class and don’t intend to start), and as I’ve always done, watching my spending without the necessity of being too frugal. I’ve over budgeted for healthcare (including travel insurance), budgeted for large home maintenance expenses, new vehicles every 10 or so years, and run tax calculators. If I end up needing assisted living, there should be plenty for that; it’ll just eat into my DD’s inheritance.
Except those who consider themselves LeanFIRE (I would never feel comfortable willingly retiring early on that little), most true FIRE adherents are more like me than the type of person you describe.
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You’ll need several million. You get to define “several.” 
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It sounds like you’re doing very well.
My point is that FIRE has been popular for how long? 15 years? If they retired at 45, they’re now 60? How many have done it for 40 years?
Maybe you have enough to retire and live on for the rest of your life. But not everyone does. It takes a lot of assets for 50 years of retirement. Im not going to throw out numbers because it’ll start a debate I dont want to go down.
However, I will say that I did Monte Carlo simulations on eMoney in 2003. And I have spoken to literally thousands of financial advisors at major conferences on financial planning strategies so I do know a little about it.
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That sounds like a nest egg of $4-6m to me. You’d need $200-250k a year to keep that up.
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Absolutely agree! H and I have a similar lifestyle as @citivas and live in a high COL area. I retired early, H at 63, a couple of years ago. We’ve worked with different FAs (one through a benefit from H’s previous company, several at Fidelity) to set our “magic” number. We’re also working with an estate attorney to fine tune long-range financial goals, such as gifting to our (responsible) adult children now while they are buying houses and living in the same expensive area.
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Financial planning is an art not a science. There are certain strategies that work really well in some (maybe most) situations but it usually depends on a lot of factors that you can’t control (ie stock market returns, inflation, tax rates). There are a lot of variables.
In theory, the Monte Carlo I ran for myself says Im also at 99%. Do I trust it? Nope.
There are very few absolutes. A common example is - should I convert a traditional IRA into a Roth IRA - well it depends.
Usually the longer the time frame, the bigger the risk.
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People who are that risk averse that they find a 99% probability of success insufficient should never retire early. The FIRE movement isn’t for them, and that’s ok. The economy needs people willing to work to 65 and beyond. Those of us who plan to FIRE are willing to assume some risk since life itself is a daily risk and we value each additional work-free day more than the minimal risk involved.
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I also enjoy my job so no FIRE for me personally. Ill probably work until I’m at least 55-60. I get why people are attracted to it and I commend people who are aggressive savers.
I also think some will fall through the cracks and it could get ugly for them later on in retirement. People who have $5+ million in investable assets have a lot more wiggle room vs those with $2 million (even if both their retirement analysis are over 90%) because a lot of post retirement costs are fixed (ie assisted care, medical expenses, etc) and not variable.
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A 4% safe withdrawal rate on $2M is more annually than most people will ever see annually working in life. The median household income is less. It’s plenty for most to retire on early. The income skew on CC tends to contribute to a skewed perspective.
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Is the 4% rule really tested for 45 years in retirement?
Most people dont need that much in retirement because most retire at around 65, not 45.
Also, if they retire at 65, their social security is also a lot higher so they dont need as much savings.
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That depends on their earnings during their lifetime. Many people work until 65 but don’t have SS income that covers their needs.
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The original research was based on 30 years.
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Right. An extra 15-20 years of expenses can really put a strain on the 4% rule unless their investments outperform historical averages.
There are usually more variable costs early in retirement (ie traveling, dining out, etc) and more fixed costs later in retirement (medical bills, prescription drugs, etc). And if that portfolio starts falling apart, my concern is that for many people,they cant really adjust their spending because they are necessary and not discretionary.
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Yes. I was comparing 2 people with similar incomes but one retired at 45 and one retired at 65. The person at 65 would need a lot fewer savings because their social security would be a lot higher.
Of course if they made a lot less then that would not be true.
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Plus medical insurance/costs rising faster than inflation - that’s a massive unpredictable possible spoiler for early retirees. I shudder to think of having to pay for private insurance for 20 years on a post-retirement income.
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IMO, what has happened in the past (and the assumptions that accompany projections) is not predictive of what will happen in the future and the longer the time frame, the bigger the risk.
I read this article and just laughed.
We’ve had an inverted yield curve for almost 2 years now which usually means we’ll have a recession. And now people are saying the inverted yield curve (which has been uncanny in predicting recessions since 1955!) is no longer a valid predictor.
“Nearly two-thirds of strategists in a March 6-12 Reuters poll of bond market experts, 22 of 34, said the yield curve’s predictive power is not what it once was.”
Since 1955 and now no longer valid??
Really?
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Definitely medical coverage factor impacted my retirement decision…. and same for most retirees we know.
I still feel quite blessed to have been able to retire at age 58, despite the drastic overhaul of my employer’s pension plan. But I might have gone at 57, when husband (7 years older) retired, instead of waiting a year until he hit 65/Medicare.
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I am very skeptical of the whole FIRE movement. I have seen too many people retire “early” only to rue the day. I remember the late 90s when the stock market was giving amazing returns and several people I knew retired early, only to bitterly regret it when returns dropped and they found that getting back into the workforce at an equivalent level as before was impossible. My FIL retired early and believed that between SS and his defined benefit pension, he’s be set for life. But the pension was cut when the company went bankrupt, he and my MIL divorced and they had to split his SS, and he died poor with his children having to subsidize him. I also think a lot of these FIRE folks are grossly underestimating the cost of healthcare. If you get cancer in your 40s or 50s you are SOL financially unless you have high-quality employer-subsidized insurance.
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I believe most people want to live a reasonable life during working years and live a reasonable life during retirement years. Most will not retire w/o reasonable health insurance coverage, and it is a sizable risk to not have very limited time before being on Medicare IMHO. DH’s uncle put in extra money for a period of time through his electrician’s union so it would bridge his/wife insurance coverage until they turned 65 - and they continue to live pretty well in retirement for over 20 years now.
Being married and having children and grandchildren often play into many decisions - it does for us. To us, with emergencies, being a safety net with resources but not a cash stream or bail out for able bodied children/grandchildren. Not rewarding bad decisions.
In the community where one lives, do need to be aware and involved with city council/city hall dynamics and decisions that affect one’s property values and/or QOL. Will definitely do a lot of research with future home purchasing. Developers and outside financial interests prey on communities where they see opportunities - see it happening in our area which drives up costs to live here beyond normal COL increases, and I imagine some people on this thread in suburban/desirable communities see it happening in their areas too.
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