1- how much of the 1.4 million are you actually going to be able to spend? Its a fictional number. Capital gains tax is the lowest its been in god knows how many years under the bush administration( 15%) Do you thing that there is any chance this could go up?
2- what about the lost opportunity cost you have on the taxes that you pay from your account over the time that you have it. Every year the IRS gets a piece of paper from the MF company on how much you owe.
3-once you are in retirement, how do you plan on spending your money without running the chance of running out? Live off of the interest from a CD? Money market? Is there a chance that interest rates might fluctuate?
4- In the amount of time that you have until retirement, do you think there is a chance of an unforseen event happening? What if its the year before you decide to retire and another september 11 type event happens, and a third to a half of your account is wiped out. What do you do? Postpone retirement? Live off of less?
just some things to ponder the your fee based financial planners don't tell you about.
Much of this is valid and worth factoring in to your decision making regarding retirement investing. However, The Beef feels that most over complicate these decisions and because of that, do little if any thing to aid in developing a retirement income program.
1- Things are different here in Canada with respect to taxation on capital gains. The 8k is a spendable sum and not based on the current value of The Beefs MF. The Beefs MF will double ( in theory 4 more times prior to retirement.) One also needs to understand The Beef still makes weekly contributions, well in excess of the $12.50 The Beef recommended to a young " aggressive " investor who would receive the 8k monthly referenced above. The Beef will receive far more then 8k monthly.
2- Can you comment further on lost opportunity ?
3- Th plans for the monthly stipend are basic, it will be used to under write the cost of The Beef's living expenses. The Beef looks upon MF as the footing onto which a retirement foundation is built. With a mortgage free home $499,000.00 ( current market value ) a monthly income from The Beefs employer and The Beef's monthly $1200 government pension ( paid to all Canadians over 65 ) things look good. The Beef does not feel that between 65 and death The Beef will scratch the surface of his income fund. When The Beef needs to be cared for, the retirement facility would receive the monthly benefits of the Beefs fund and upon The Beef's passing the fund would be paid out to a beneficiary ( The beef's great nephew ) and would be taxed at the time of pay out.
4- The Beef does not factor this into his plans to any degree and nor should anyone structuring a retirement portfolio. These considerations are for fund managers to deal with and with that in mind, The Beef's MF ( and employer pension fund ) rode out 9/11 very well. Again, the aggressive position ( length of time you are in the market ) offsets these term loses providing that the MF is diversified and maximises the advantages that come from the Canadian and foreign content regulations .
The Beef
