Ep 007 Friends Talk Finance: Retirement Planning Basics

Jul 3, 2017

Friends Talk Finance: Retirement Planning Basics

Are you saving for retirement? How much do you need to become financially independent? Bonnie Koo, MD and I talk all about the basics of retirement spending in another episode of Friends Talk Finance: Retirement Planning. Thanks for listening! If you have any questions, please send them our way.

Show Outline

• Bonnie hires a professional organizer!
• Financial Independence:
• • FIRE=Financial independence/Retire early
  • Miss Bonnie MD's post: Financial Independence, Early Retirement and FIRE
  • Physician on FIRE's post: Financial Independence versus Financial Freedom
• Calculate your 4% goal
• You want your money to outlive you in retirement, you don’t want to run out
• How do you decide how much money to save?
• • The 4% rule
  • William P. Bengen, October 1994
    “Determining withdrawal rates using historical data”- Link to full text of the article

• "Based on analysis of worst case scenarios since 1926“Assuming a minimum requirement of 30 years of portfolio longevity, a first-year withdrawal of 4 percent… followed by inflation-adjusted withdrawals in subsequent years, should be safe. In no past case has it caused a portfolio to be exhausted before 33 years, and in most cases it will lead to portfolio lives of 50 years or longer.”

• • Four percent rule calculator
• Retirement account types (for employed):
• • 403(b), 401(k)
  • 457(b):  private vs. public
  • Roth IRA
  • • Backdoor Roth IRA-Tutorial by White Coat Investor
  • Regular taxable account
  • Pension

For more info, check out some of Bonnie's blog posts:

Should I use my Hospitals 457b
Roth Roth Roth
Brief Update on our Finances

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