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It comes down to hope for the best, plan for the worst. Or in this case, plan for a sort of middle ground.

Whether you want to accept that low predicted returns for the next few years is true or not, or instead believe that that is taken into account with the SWR studies, it can simply come down to it not being safe to plan on the best case scenario of what is safe based on high past returns. Discounting future returns looking lower, should you not seek a margin of safety on expected future returns that you need to live off because when you've quit your job there is not necessarily an easy way of going back to work on the same pay as many retirees found who are now working at Wal-Mart and not able to save the difference of what they have vs. what they need.

In life, how many times do you get the best case scenario? Not often. Usually, you get about average. Planning for 100% of the annualised return received this past century doesn't leave any wriggle room for a few bad years. Intercst's study has you spending down the money over 30 years. Retirees age 50 may live 50 more years meaning the study isn't appropriate for them. If you get a bad first 10 years once FIREd, the money won't last 30 years, more likely 20 years, leaving your broke at 70, crawling back to Wal-Mart. Do you really want to be working a tough bunch of hours a day at age 70 dealing with snippy tired customers and worried about how long they will employ you before saying you're too old or you get too old to work? Planning for a lower expected return is therefore a far more prudent approach to take, where you don't spend down your capital but instead live off their returns above inflation. This works for people FIREd at any age and if you do better than your more modest/ realistic estimates, you have a little more cash to spend. But if you don't, you're still okay.

Putting out a study which doesn't provide for this kind of planning is irresponsible if people aren't clear what it does and doesn't include. Intercst's numbers may well be right as other SWR analysis prior have borne out but the approach & assumptions are inappropriate for smart FIRE investors. With improved healthcare, life expectancy is increasing and early retirement covering 30 years if markets are good and less if markets are bad doesn't cut it. It is at best, highly misleading.


I don't have a problem with presenting alternatives. Lets just be careful how we present things and avoid sloppiness that could be hazardous to one's FIRE status.
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