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TheBadger wrote,

In a way, I am implicitly suggesting that there might be more than one test in order to retire and stay retired. Test one we regularly beat to death, e.g. somewhere between 3% & 5% of investable assets can be consumed each year and one can remain highly confident to certain of dying before becoming broke. I am suggesting that test two is some relationship between non-income producing assets & income producing assets, but I don't know where the frontier is.

Thus, I wonder if there is an obvious right answer here or a maximum we should all stay below? Is 6% okay? Well it works for me. Is 12% okay? Is 20% okay? At what percentage does the house collapse?

I agree that "non-income producing" assets will delay your retirement. (I don't own a home, so I've been able to keep my "non-income producing" assets below 1% of net worth.)

I think the best way to handle this is to remove the "non-income producing" assets from your retirement calculation. Remember, "safe" withdrawal rates are "3% to 5% of your retirement assets", not your "net worth."

The most important thing is to get a good handle on the annual cost of supporting and maintaining your "non-income producing" assets. As long as a 3% to 5% annual withdrawal from your retirement portfolio allows you to pay taxes on a big home and the maintenance costs on your BMW, you should be OK.

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