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by Gunax 1968 days ago
The rule of thumb is that you can safely withdraw about 3% of you saving annually (same say 4%, some say 2.5%, depends on how risky you want to be).

So estimate what you can save over 10 years and determine if you're willing (or capable) of living on 3% of that.
1 comments
stouset 1968 days ago
This is pretty much it. Let’s say at 50 you’re comfortable living off of 4% of your assets, which should have a reasonably high chance of providing income throughout your retirement without depleting your principal. This 4% is assuming 7% market returns before 3% inflation.

How much are you willing to live off as income? If you need $40,000/yr (before taxes) you’ll require $1m in savings. $60,000 requires $1.5m. Tax-advantaged savings like a Roth IRA improve things here a bit but we can ignore it for a general ballpark idea.

Let’s say you’re frugal and only need $40,000. You’ll have to save up $1,000,000 in invested assets over a decade. Given expected 4% inflation-adjusted returns, this works out to around $85,000 in savings each year (adjusted upward 3% each year for inflation).

In order to afford those savings, after tax and $40,000 in annual expenses, I’d guesstimate you’ll likely need somewhere in the ballpark of $150,000/yr of income. Again, adjusted upward 3% every year for inflation.

By the same math, if you want to live off $80,000 a year, you’ll probably need to earn $350,000 or more annually over that decade. The number more than doubles because of the increased taxes at those kinds of incomes.

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blackrock 1968 days ago
This is easy. Just find a job that pays you $350,000 a year.
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stouset 1968 days ago
I mean, the goal is to retire in ten years starting from scratch. And that number is assuming you want to have a reliable $80k/yr income without ever depleting your principal.

If it only took the median income, everyone you know would be retired at 35.

The guy asked a question and it was answered. Retiring from nothing in ten years is hard. Retiring from nothing in ten years with an above-median retirement income is even harder. Is that supposed to be surprising?

I’m all ears for your better plan.

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divtiwari 1968 days ago
Just get a job as a SDE in Netflix or Renaissance Technologies. /s
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sdevonoes 1968 days ago
That's is easy (just spend 4 months memorizing algorithms and hack the tech interview). The problem is to keep working on that kind of job for 10 years (after a few months they would realise that the only reason you passed the tech interview is because you memorized algorithms... then you would get FIREd).
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blackrock 1968 days ago
How many golf balls can you fit into a Boeing 747?

And somehow, this question is related to engineering world class software systems. I’m still trying to figure out how.

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blackrock 1968 days ago
LOL. Not a problem. If only you could’ve predicted the future, 20 years ago, that Netflix would’ve paid their software engineers $350,000 a year.

Back then, Netflix was just some silly DVD rental business.

Then, you could’ve studied and did whatever you could to land such a job with them.

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