Do you mean you withdraw max. 3,5% from the initial portfolio?DW and I retired early.
Given the long duration of our retirement, if our withdrawals exceed 3.5% in a year that would be a red flag. Per firecalc 4% has a small failure possibility.
We withdraw whatever we want to do whatever we want, as long as we’re below 3.5%. But we don’t withdraw extra just to get up to 3.5%. If we ever are forced to exceed 3.5%, we’d need to do some budgeting.
We are currently withdrawing from taxable. We have some appreciated company stock and are selling that first because that’s our major risk factor. Of the company stock we sell the highest cost basis to minimize tax, but we’d rather sell highly appreciated company stock than lowly appreciated index fund to try to gradually reduce risk.
We sell and withdraw as we need it, multiple times a year, keeping some cash cushion to avoid forced sales in dips.
Our big ticket expenses are property tax, health care, and quarterly estimated income tax. As a result I usually sell/withdraw quarterly. I often sell just after a quarterly estimated tax period. For example, if I sell on August 31st taxes are due September 15th (bad). If I sell September 1st taxes aren’t due until January 15th (good).
Statistics: Posted by Fireishere — Tue Jul 02, 2024 3:30 am