My Financial Plan

A post about my own financial plan on Facebook and Twitter attracted a lot of attention.

In the past, I have disclosed some details of my financial plan related to when I plan on retiring (which is to say I don't want to retire for a long list of reasons) and my asset allocation (it has always been very low to stocks).

The main reasons I don't want to retire are that I love my work and I believe not retiring is the best way to stay meaningfully engaged which is a means of successful aging. I realize that people may not be too eager to have an 80 or 85-year-old investment manager but I will cross that bridge and as I always say, I may feel differently later. I began to think this way in my 30's and still haven't changed my mind yet but you never know.

One comment I have made in talking about asset allocation generally is to say "if you are relying on normal stock market growth..." By virtue of living well below our means and having made a couple of lucky decisions along the way, we aren't necessarily relying on normal stock market growth and so I have maintained a very low allocation to equities over the years.

I've made the comment that while I have no plans to retire, we save money like we are desperate to have retired last year. I feel this creates optionality and allows for better weathering any adverse circumstance that might come along, it is very empowering. Our Plan A is to not need our savings when we are older. My FRA for Social Security in today's dollars is around $2850/mo (more if I wait until a later age) and my wife's spousal benefit then would be $1425. We have one rental property that generates about $1500-$1700/mo in today's dollars and it will be paid off in my mid-60's. All of that more than covers our monthly expenses and then some. We'd even be ok with the potential 23% haircut to Social Security. The hope then is that our savings would be for traveling and any emergencies. Again that is Plan A.

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