12-10-2021, 05:22 PM
Plans are great but we had a saying in the Army........... Semper Gumby, (always be flexible). 
Life doesn't follow our rules sometimes.
Unless you have an enormous amount of resources, at some point the market throws a curve. A backup plan is good, and an inflexible decision is not required today. Stressing about it won't enhance your retirement years. My retirement is somewhat unique in the modern day. My pensions are generous but there will be a two year bridge before I get SSA. I intend to pay myself quarterly and an extra draw at tax time. Target drawdown will be 4% annually. If the market has a crazy good year perhaps 6%. Never less than 3% if I actually need the income.
Here is my order of hierarchy to draw income from my IRA port.
1. My conservative option income strategy yields about $4K+ a month when the market is sideways or up trending. $2K is doable in a rough market. It would be best if I cease this completely for months in the event of a true crash. I am going to plan on it for 2 quarter draws per year. 3+ has been more accurate the past few years. It could be good for all my income some years. No way to know.4
2. Dividend income. I will count on it for 1 to 1 1/2 quarter draws per year. It falls way short of totaling sustaining my income needs. Too much of my money selling options because the yield is 2-3 times more than a good dividend stock.
3. Cash bucket. I have a couple of years of cash if stock Armageddon comes. I'd prefer to leave it alone but the world won't end if I raid it for $5K now and then.
4. Selling shares. Nobody wants to do that but the truth is if you are heavy into growth stocks that run hard then replenish the cash bucket. I won't forget to nibble some shares back if the market gets whacked, and at some point it surely will.
5. If the above starts to fail for years, then I guess I work a part-time job a few months a year and adjust the budget for the next year. Wouldn't wreck my life. I know how to retire again. I don't see that as a recurring problem but we never know for sure.
I am very comfortable with the above plan because it is flexible. Worst case I could ditch the option selling scheme and just go DGI and accept far less monthly income. It would be less complicated, but after literally thousands of trades, I've put in my time and I'm not giving up on that easily.
Life doesn't follow our rules sometimes. Unless you have an enormous amount of resources, at some point the market throws a curve. A backup plan is good, and an inflexible decision is not required today. Stressing about it won't enhance your retirement years. My retirement is somewhat unique in the modern day. My pensions are generous but there will be a two year bridge before I get SSA. I intend to pay myself quarterly and an extra draw at tax time. Target drawdown will be 4% annually. If the market has a crazy good year perhaps 6%. Never less than 3% if I actually need the income.
Here is my order of hierarchy to draw income from my IRA port.
1. My conservative option income strategy yields about $4K+ a month when the market is sideways or up trending. $2K is doable in a rough market. It would be best if I cease this completely for months in the event of a true crash. I am going to plan on it for 2 quarter draws per year. 3+ has been more accurate the past few years. It could be good for all my income some years. No way to know.4
2. Dividend income. I will count on it for 1 to 1 1/2 quarter draws per year. It falls way short of totaling sustaining my income needs. Too much of my money selling options because the yield is 2-3 times more than a good dividend stock.
3. Cash bucket. I have a couple of years of cash if stock Armageddon comes. I'd prefer to leave it alone but the world won't end if I raid it for $5K now and then.
4. Selling shares. Nobody wants to do that but the truth is if you are heavy into growth stocks that run hard then replenish the cash bucket. I won't forget to nibble some shares back if the market gets whacked, and at some point it surely will.
5. If the above starts to fail for years, then I guess I work a part-time job a few months a year and adjust the budget for the next year. Wouldn't wreck my life. I know how to retire again. I don't see that as a recurring problem but we never know for sure.
I am very comfortable with the above plan because it is flexible. Worst case I could ditch the option selling scheme and just go DGI and accept far less monthly income. It would be less complicated, but after literally thousands of trades, I've put in my time and I'm not giving up on that easily.