Tuesday, July 21, 2015

Q&A from My First Poland Relocation Forum Post

Good questions. Let's discuss here, and if necessary, summarize in another post, for easy consumption.

(05-05-2015 11:28 PM)Brodiaga Wrote:  -Did you factor the taxes in? @18K/year withdrawals, how much do you expect to pay in US taxes?
I didn't factor taxes in because I don't expect to pay much, as Mr. Money Mustache demonstrates in "The Lovely Low Taxes of Early Retirement": http://www.mrmoneymustache.com/2012/06/0...etirement/

Plus I plan on "moving" (for tax purposes) to a retirement-friendly state like Texas (no income taxes I believe) before moving abroad (my US forwarding mailing address will likely also be in Texas).

(05-05-2015 11:28 PM)Brodiaga Wrote:  -How are you going to withdraw money? Are you planning to withdraw from taxable accounts first, and then 401k and Roth IRA after you turn 59 (I assume you use tax advantaged accounts). Are you planning to start withdrawals from tax advantaged accounts when you are younger (72t from IRA, withdraw principle from Roth IRA, etc)?
I actually need to look into this more - not that it's a make or break thing, but who wants to give Uncle Sam more money for nothing? Off the top of my head, your former plan (taxable then traditional 401k then Roth 401k then Roth IRA) seems the best, but I have read a little about SEPP/72(t) and it seems interesting. I assume the former plan is your plan?

(05-05-2015 11:28 PM)Brodiaga Wrote:  -Do I understand correctly that you are heavily invested in equities even as you start withdrawing money?
Yep, 50% low-cost S&P 500 index funds and 50% of the ex-US equivalent, thus replicating current world capitalization (roughly, and according to Vanguard's Total World Index, if the name is correct). That should result in the most efficient (publicly available) portfolio.

(05-05-2015 11:28 PM)Brodiaga Wrote:  -Have you stress tested your plan? Used firecalc simulations or something similar? What is your plan if, for example, the dollar loses its value vs the euro or a new recession hits and the market crashes?
Mr. Money Mustache actually stress-tested the 25x tip in a post entitled, "The 4% Rule: The Easy Answer to “How Much Do I Need for Retirement?": http://www.mrmoneymustache.com/2012/05/2...etirement/

At the end of the day though. no retirement plan is 100% secure, just like no seemingly golden-goose on-line business is 100% secure. Planning has to be balanced with flexibility, which can always be unforeseen but forced upon you (kinda like how you deal with women - you have a model or principles, but you can't script a reply to every contingency).

I'll probably also try to make money from my hobbies, as Mr. Money Mustache has done, and like him, mostly for the fun of it, rather than out of necessity. Gotta have a project (outside of women), as Roosh and countless others on this side of the web have said.

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