Retirement Years: Go-go, Slow-go and No-go phases

I'm mid 40s now, and probably looking to pull the trigger in about 10 years.

When do you plan to pull the SS trigger? How are you funding medical, and when are you moving towards Medicare/Medicare (can't recall which is which).

The financial habits that got us to this point as early retirees are hard to break.
I'm realizing 4 years in that I really need to apply similar disciplined approach to spending in go-go years that I had in accumulation phase. That became second nature, liberal spending isn't at this point. Frugality and investing any excess is no longer serving us well. I need to build a structure to force spending or at least awareness taht I haven't met spending targets and make deliberate decision not to.

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When do you plan to pull the SS trigger? How are you funding medical

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SS at 70yo

Retired w/company after 30yrs so healthcare program and coverage same as employment in terms of company’s offering, them covering 80% / me covering 20% of costs. But now as retiree policy so costs did jump 33%+ (given an older / higher healthcare costs and smaller pool of people). Blessed in this regard.

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The financial habits that got us to this point as early retirees are hard to break.

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Hear you!

Doing Year 2 planning now. First look is we will be under our target withdrawal by a decent amount, even with a very nice lifestyle planned.

Finding it difficult to change our mindset and consider spending more!

My wife and I have a framework that allows us to “see” when we have excess savings that are eligible for discretionary spending. We call it “permission to spend”, because we recognize the same habits that got us where we are today will stop us from living our best lives in retirement. We already have generous retirement incomes, so this is akin to a bonus. These bonuses have, so far, been far greater than any bonuses I ever received while working. It’s great, because there are no arguments. We both know when we have money to spend or when we do not.

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With this objective and your personal plan, you probably die with roughly the same amount you have now, which in future dollars will be less

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Thanks!

Know Erin’s videos well. Love them, especially for this grand planning level of context.

Should have mentioned a pension that relieves the withdrawal rate, as well. Aside, your math matches the starting point impact and ending balance, but with much less erosion (ie, from pension relief).

Interested in hearing from those who have lived long retirements to learn if I am missing anything that I should be considering re these categorized withdrawal rates. Do they jive with their reality or perhaps not?

I use a modified version of Jason Kelly's Income Sig strategy as a framework for what I call "permission to spend."

The strategy maintains a cash Reserve with a predetermined target. That Reserve serves as my financial buffer and determines whether discretionary spending is appropriate.

When my Reserve is above its target, I have permission to spend discretionarily. When it falls below its target, replenishing it takes priority over discretionary spending. Income Sig's investment income and portfolio management rules provide the means to maintain and rebuild that Reserve over time.

The important distinction is that I don't make spending decisions simply by looking at my total portfolio value or how well the market has performed. I have an objective threshold that tells me when spending is financially appropriate and when I should exercise restraint.

It's not a mandate to spend whenever I can. It's a system that gives me permission to enjoy the wealth I've accumulated without constantly second-guessing whether I should be saving instead.

I follow an investment strategy called *Income Sig*, developed by Jason Kelly. It has two main components: the **Generator** and the **Reserve**.

The **Generator** is the growth engine. Its job is to grow investments, produce income, and periodically harvest profits. It's more aggressive and can experience significant market volatility.

The **Reserve** is the financial safety net. It holds more conservative investments and provides money for living expenses, particularly when markets are down. This allows the Generator time to recover without forcing me to sell investments at depressed prices.

My approach is to establish a **target for the Reserve**, measured in years of spending coverage. I currently favor approximately five years, accounting for income I conservatively expect the investments to continue producing. That gives me a substantial cushion against prolonged market downturns.

Here's where my **"permission to spend" philosophy** comes in.

When the Reserve is **below its target**, my priority is rebuilding it. Profits generated by the investments should replenish the Reserve rather than fund additional discretionary spending.

When the Reserve is **comfortably above its target**, I've earned permission to spend some of that surplus on things I want, not just things I need. I could also reinvest the excess or retain a larger cushion. The important distinction is that I have permission to spend, not an obligation.

The beauty of this approach is that I don't have to constantly wonder whether I can afford a major discretionary purchase or feel guilty about enjoying the money I've accumulated. I've established financial rules that help answer that question objectively.

**The Generator creates the opportunity to spend. The Reserve determines whether I have permission.**

I'm not trying to die with the largest possible portfolio. I'm trying to enjoy the wealth I've accumulated while maintaining enough financial security to weather difficult markets and preserve my options for the future.