Re: How much can I withdraw?

In article <[EMAIL PROTECTED]>,
 [EMAIL PROTECTED] (Doug) wrote:

> This is a little hypothetical, but not totally. OK, lets say i have
> worked and saved, maybe inherited a little. Kids are grown and I am
> 60. I want to "retire". I have a nest egg, house is still mortgaged,
> but I could pay it off. I do my budget and figure I need about $60K a
> year, right now, and that much buying power in the future. I have $500
> a month from Social Security, $2000 a month from a retirement (fixed
> till I die). How much nest egg do I need?
> Alternatively, and probably easier to answer, lets say I have $1
> Million. How much can I take each year, and not run out. 4%, 5%, 8%?
> 

Questions - Does your $60K include the mortgage payment
            Is it before or after taxes
            Haw are your savings invested.

Simplistic Approach
     You need about 30K a year from your savings initially.  Inflation 
will eat at your retirement but not at your Social Security. Assume that 
you annuitize your nest egg and yield 4% from it. Multiply $30K by 25 
and you need $750K in a 4% immediate annuity.

Better Approach
     Visit the retirement calculator at the T. Rowe Price website.  
Assume that your retirement and social security are invested in a fixed 
income source yielding 4% and your savings are invested partially in 
equities and fixed income and let the retirement calculator run the 
Monte Carlo simulations.
     There are similar calculators at financialegines.com and The Reire 
Early web page.  
     If these steps are beyond you then you need see a fee only 
financial planner
-- 
Avrum Lapin        [EMAIL PROTECTED]
Upland CA          Remove NOSPAM from address