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Rocannon -

What did your friend decide to do? Although, technically, this is not a retirement scenario, the same dilemma applies - that being a sharp market downturn in the first few years which hurts the rest of the time period.

As AJ showed, your friend can only achieve his goal by spending less and adopting a disciplined asset allocation that allows the equity or fixed income investment to grow/rebound from a market downturn.

So, following Gene's approach of keeping $150K in cash to cover the first 3 years, I ran a couple of scenarios for the rest ($350K). It looks to me like a 50-50 split ($175K each in fixed income and equity) would accomplish his goal. However, my rough calculations does not account for inflation.

If your friend were willing to work part-time, the added income would make the goal much easier to achieve.

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