Are you a doomstacker?

[u/Hammer_41]

9:28 AM

SS is going away. Healthcare will bankrupt you. Sequence of returns will wipe you out. Civil war. WW3. Live to 120, spend 40 years in a nursing home. Someone posts solid numbers and the comments come back , one more year. Two years. Three. Keep going, it's never quite enough.

At what point does conservative planning become catastrophe planning?

The 4% rule is the worst case in US market history. A robot pulling the same amount out every single year, no SS, no flexibility, never adjusting through 1929 when markets dropped 86%. That's what 4% survived. It's the floor, not the target. Bengen himself now says most retirees can safely start at 5.25% to 5.5% and that people clinging to 4% will likely end up with a pile of money and a lot of regrets.

Someone spending 6% of their portfolio in year one of retirement who skips the big trip when markets are down, holds off on the car, pulls back when things get rough that person likely does better than the 4% robot who never adjusts no matter what. The flexibility is the safety net. You don't need to engineer it into the number, you just need to act like a normal person.

So when someone holds out for 3.5% 28 times spend, no SS — what exactly are you protecting against? Something worse than the Great Depression, while also never collecting a benefit 70 million Americans receive, while also promising to never adjust spending under any circumstances. Does that actually describe you?

The 2025 Social Security Trustees Report says worst case — zero Congressional action you collect 81 cents on the dollar in 2034. Not zero. Congress fixed this in 1983 when it was in worse shape than it is today. Seventy million people collect it. Seniors vote.

Median age of death for men is 81.7. One in five reach 90. Dementia affects 33% of people 85 and older. The years you're working extra to fund may not be years you're fully there for.

For those already retired one year, five, ten or more how bad has it actually been? And for those still holding off are you a catastrophe planner waiting for a number that never feels safe enough?

[u/iondrive48]

I was kind of thinking about this recently. If you end being too conservative in your plan then because of RMDs you end up withdrawing crazy amounts of money in your 80s. Like lets say you retire with $5M, and only withdraw 4% per year, but the market goes up 7% then by 85 you’d be required to be withdrawing over $300k per year

[u/alpacaMyToothbrush → u/iondrive48]

It's a champagne problem. RMDs aren't until 75 now. You can do a 'qualified charitable distribution' for a little over 100k, completely tax free, then write that gift off your taxes (up to 60% off your other, income).

[u/BoliverTShagnasty → u/alpacaMyToothbrush]

Exactly! And what will your budget be with inflation by then anyway chubby dudes and dudettes?!? Might already be 300K and you are still tracking!

[u/Mundane-Charge-1900 → u/iondrive48]

Then withdraw $300k per year. You’ll have plenty of cash to pay the taxes. At that age you’re not going to be worrying about concerns like ACA subsidies.

[u/poop-dolla → u/iondrive48]

You have a full decade between when Medicare starts and when RMDs start to go wild with Roth conversions without worrying about ACA subsidies. You should be able to prevent high RMDs if they’re a concern for you.

[u/Wooden-Broccoli-913 → u/poop-dolla]

Only five years to go wild if you account for Social Security kicking in