Playing with FIRE

Oh, gee! Eat into the capital? I couldn't do that! I'd never sleep!

 

I reckon just say you run an online business and leave it at that.

 

Not much. Perception is that we're completely going off but when you break it down, you'll see why it adds up.

I've inflated some of the numbers slightly (to be conservative) but wouldn't be surprised if it came close in reality at the end of each yr.

Sure, these could be shaved but it would require everyone being diligent. I trust myself but the rest of the family....


Schooling expenses, excursions etc $5,200
Electricity/gas $4,160
Dinner out/lunch at work $4,160
Health Fund $2,782
Shopping for clothes, toys,play money, etc $2,600
Car Repairs $1,560
Mobile phone - family $1,500
Car insurances/Rego $1,404
Kids sport/related costs $1,300
Medical emergency, drugs etc $2,000
Kids swim lessons $1,014
Pricefinder $822
Gym $796
Internet $891
Transport - bus return trips to CBD $2,600

Adds up to $32K per annum plus (excluding groceries)

 

Not sure what this means...if you have enough of your own investments/capital within or without super to generate $128K, do you still get the pension?

 

Nope.

I am planning NEVER to rely on the Government to set my level of living/lifestyle .

 

"Self funded" pension is the pertinent point.

I believe at kierank's age the requirement is that one takes 4% of the balance of the fund as a pension each year. As kierank and partner each have the maximum $1.6mil in the pension fund, they must each take $64k per year.

 

Right. Does that also imply that the $128K is tax free?

 

Yep

 

But I wouldn't do that as that's against my philosophy, that would be a lie....? They do read online though, no TV!

 

Running an investment/property portfolio IS a business.

 

True, I suppose they can use that...but some keep such things very private, don't share like we do.

 

At some point each of us has to move past the point of worrying what people might say if we tell them something they’re uncomfortable with (like we’re financially independent or don’t work etc). If they’re the ones that have an issue with it, why are we moulding ourselves to fit around that.

 

Oh cool, thanks!

 

Lol yeah it’s maybe not for everyone. But if net worth is enough then barring catastrophe and spreading it out over a decent timeframe it’s likely to work out just fine.

Not really that much different from doing it all at once. Net worth is still earning returns over time and you’re still living off the portfolio whether growth or income until eventually it’s all income.

 

Plan on the date you will leave this earth then spend like crazy up until then. Problem solved.

 

That is correct.....this what happens....98% of the people under estimate the growth over time. This is because 90% of the people out there are financially illiterate.

I am stunned by how many people who hold decent portfolios and don't understand this. It comes to down to getting educated...and understanding facts from myths.

 

Just for my reference/planning, at what age are were your kids fully financially independent? Having certainty around that will give me a proxy on when my expenses will ramp down.

 

From memory, one left home around 18 and the other around 20.

They are now in their 30’s and the good news for us is they have never returned home .

 

Ah, I get it. You've moved and are now under a witness protection program.

 

Nah, they are both being cared for at Her Majesty‘s pleasure .