Thanks, Andre! A mostly unrelated question, and you’ve probably covered this somewhere else before, but do you include taxes in your target Enough Number/3% withdrawal rate?
I didn’t explicitly include them in the core 3% calculation. I went back and did a deeper account level analysis that incorporated them fully in this post and 3% is so conservative that it didn’t impact the survival: https://www.faangfire.com/p/enough-in-san-francisco-what-about-taxes
I love the chart you provided! Great article, I appreciate how you keep things simple!
A small nit that I noticed, it shows 0% cash which may mean for some that you don't have an emergency fund, which I expect your 0% cash is more intended as short-term cash & cash equivalents outside of your emergency fund.
It has to do with the chart explicitly showing my “Fire portfolio” which intentionally don’t include any of my individual stocks, cash, emergency funds.
I don't have as strongly informed positions around the specifics of the bond allocation. This is something I am trying to actively dig in more, but won't ever pretend to be an expert on when I am not.
All my bond holdings are in Pre-Tax accounts, so I am not sure if a treasury specific fund makes sense in that placement. My biggest holding is currently SS US BOND INDX XIV through the Meta 401k, I think it is very similar to BND in that it tracks the "U.S. Aggregate" bond market.
I paused all taxable investments and am paying off mortgage. Considering the investments are long term, 20% fed + >12% state is still a lot of stress and monitoring compared to paying off a 5% mortgage.
I like that plan of tackling more of the mortgage before going hard on your mortgage payoff.
There is a lot of nuance and I don't want people pausing all their retirement contributions or giving up free employer matches/espp. The details, amounts, and specific cash flow needs matter a lot.
That flow chart is bomb.
Being boring is so underrated
Super underrated.
Thanks, Andre! A mostly unrelated question, and you’ve probably covered this somewhere else before, but do you include taxes in your target Enough Number/3% withdrawal rate?
I didn’t explicitly include them in the core 3% calculation. I went back and did a deeper account level analysis that incorporated them fully in this post and 3% is so conservative that it didn’t impact the survival: https://www.faangfire.com/p/enough-in-san-francisco-what-about-taxes
Thank you!
I love the chart you provided! Great article, I appreciate how you keep things simple!
A small nit that I noticed, it shows 0% cash which may mean for some that you don't have an emergency fund, which I expect your 0% cash is more intended as short-term cash & cash equivalents outside of your emergency fund.
It has to do with the chart explicitly showing my “Fire portfolio” which intentionally don’t include any of my individual stocks, cash, emergency funds.
That makes complete sense, thanks Andre!
why only 3 months in an emergency fund vs 6 or even 12 months?
Why BND rather than GOVT? BND will perform a bit better, but also more correlated with VTI.
I don't have as strongly informed positions around the specifics of the bond allocation. This is something I am trying to actively dig in more, but won't ever pretend to be an expert on when I am not.
All my bond holdings are in Pre-Tax accounts, so I am not sure if a treasury specific fund makes sense in that placement. My biggest holding is currently SS US BOND INDX XIV through the Meta 401k, I think it is very similar to BND in that it tracks the "U.S. Aggregate" bond market.
What interest rate makes a debt high interest debt?
5-7%+ generally. However the type of debt matters here too. I wouldn't pause all investments if it was a home mortgage.
Why not home mortgage?
I paused all taxable investments and am paying off mortgage. Considering the investments are long term, 20% fed + >12% state is still a lot of stress and monitoring compared to paying off a 5% mortgage.
I like that plan of tackling more of the mortgage before going hard on your mortgage payoff.
There is a lot of nuance and I don't want people pausing all their retirement contributions or giving up free employer matches/espp. The details, amounts, and specific cash flow needs matter a lot.
Right. It's all a trade off for personal preferences.