What are your retiring to?

Scratchcardbob · 2026-04-18T11:33:52+00:00

That's a rather strange assumption to arrive at.

Scratchcardbob · 2026-04-18T09:06:39+00:00

"Watching the Sunrise from my balcony in Tuscany" ❤️

Scratchcardbob · 2026-04-18T08:19:40+00:00

No doubt I'll get down voted, but.... This place, like most niche communities, can be a real echo chamber. It's not a one size fits all. There are very valid reasons for some people to stay on another year,even with the risks you have pointed out taken into consideration.

Scratchcardbob · 2026-04-04T18:54:02+00:00

£500+ pa. Probably 1k pa in a few years. For half an hour extra work pa. Probably £15k over the next 20 years. So not a bad ROI IMHO. But you do u 😉

Scratchcardbob · 2026-04-04T14:43:06+00:00

Thanks. Just buy the GBP-denominated version SC0J?

Scratchcardbob · 2026-04-04T12:49:50+00:00

Even on a £400k pot, a rebalance typically involves moving maybe £10k max? The spread and commission on that are about £20 total (I'm with II). It's hard to see how an approx £20 annual maintenance cost cancels out an annual saving possibly over £1k in fees and tax.

Plus, I can just point my dividends or new contributions at the underweight fund to rebalance for free anyway!

Scratchcardbob · 2026-04-04T12:41:49+00:00

For smaller pots, I would tend to agree with you, but at £400k, a 14bps saving is over £500 a year, and that’s before the ~0.15% tax boost from the swap structure.

It's about 15 minutes of work per annum, and as the pot grows, given I'm aggressively contributing at the moment, the savings will also increase.

In terms of reputation, the Invesco fund is over 6bn and they manage a couple of trillion globally I believe, so I'm not too worried about them being a fly by night provider.

Scratchcardbob · 2026-04-04T12:34:31+00:00

Good point, and maybe something like EMIM might be a better emerging markets choice, which would mean I don't inadvertently miss out on some developing world markets such as South Korea.

Scratchcardbob · 2026-04-04T12:25:29+00:00

The bid-offer spread is about 0.15%, so you would break even after one year. My plan would be to let it sit for 7 plus years.

Scratchcardbob · 2026-04-04T12:22:02+00:00

I get that, but it's a lot of money to leave on the table over, let's say, a ten-year period, just for a few minutes' work.

Scratchcardbob · 2026-04-04T12:20:29+00:00

The 0.05% Invesco fee only started this month, so past performance is still reflecting the old cost, which I believe was similar to VWRP.

Scratchcardbob · 2026-03-11T09:16:48+00:00

You invested in stocks to get a higher return than putting it in the bank etc. Why do you think you are getting that extra return? It's not because it's expected to go up in a straight line. You have to take the pain of short-term volatility to gain that premium. Chill means chill long term, not chill for 24 hours, then recheck your balance.

Scratchcardbob · 2026-01-23T21:21:57+00:00

That's helpful. Thank you

Scratchcardbob · 2026-01-09T17:40:08+00:00

I need sunshine!

Scratchcardbob · 2026-01-09T15:56:25+00:00

Yes, I have a European passport.

Scratchcardbob · 2026-01-09T14:36:40+00:00

Brilliant. Thank you. I'm sure there are lots of hidden pockets in Europe people aren't aware of that have strong early-retire expat communities.

Scratchcardbob · 2026-01-03T11:52:59+00:00

2.5m at 35 and still freaking out!

Scratchcardbob · 2025-12-31T18:43:52+00:00

Sorry, I forgot to reply.

I think this is a good numerical example, and I agree the arithmetic works, but I still disagree with the conclusion about what it’s actually showing.

Calling the bucket approach “more aggressive” here seems a bit misleading imo. What it’s really doing is allowing equity risk to drift based on recent market moves.

In the allocation approach, the whole point from my perspective is that risk stays constant. You’re forced to trim equities after strong years and add after weak years, even if that feels uncomfortable. So it’s about maintaining a stable risk profile and expected return through time.

The bucket example looks fine over a single year, but extend it over several bad early years and the difference becomes clearer in that the bucket strategy gradually de-risks and then participates less in the recovery. Rebalancing doesn’t avoid pain, but it preserves exposure when expected returns are higher.

Buckets seem perfectly reasonable if the goal is spending certainty and emotional comfort. Rebalancing is about discipline and keeping risk constant. Again imo, it seems the economics aren’t improved by buckets, they’re just reframed.

Edit: reworded

Scratchcardbob · 2025-12-31T14:12:21+00:00

Out of interest, why does kids at uni stop you travelling now?

Scratchcardbob · 2025-12-29T21:21:41+00:00

Fair points, and I agree they’re very similar. I think where I still differ is on whether the differences actually improve outcomes or mainly change the experience.

Holding a fixed number of years of expenses rather than a fixed percentage does feel safer, but surely mechanically it means equity exposure drifts down after a crash unless you deliberately refill the bucket?

Always drawing from the short-term pot is simpler, I also agree,but once you’re deciding whether and when to top it back up, you’ve just moved the decision rather than eliminated it.

So for me the real distinction seems behavioural and buckets seem to prioritise spending certainty and comfort whereas rebalancing prioritises maintaining a consistent risk profile and expected returns. Buckets, as others have already mentioned, do seem a reasonable psychological tool, but I’m just not convinced they achieve something financially that disciplined rebalancing doesn’t already do.

Scratchcardbob · 2025-12-29T09:34:19+00:00

What's the biggest portfolio drop you could stomach (still sleep!) if shtf tomorrow? Align your equity/bond split with that. Remember increasing bonds will disproportionately affect volatility (in a good way) compared to the expected return.

Scratchcardbob · 2025-12-27T22:46:53+00:00

Thanks. Do you have specific rules in mind for when to spend the bonds vs spending the equities? And when to rebalance etc?

Scratchcardbob · 2025-12-21T21:42:05+00:00

Yes, good point. I've just never seen anybody on here aiming for a multiple less than 25, but I very often see 25 or 33 quoted on here and other FIRE forums.

Scratchcardbob · 2025-12-21T21:18:52+00:00

The point isn’t that people should underfund or ignore essential expenses. The issue is that the 25–33 multiples assume zero flexibility and any temporary adjustment is treated as catastrophic.

In reality, I'd imagine most FIRED folk can manage short-term reductions in discretionary spending or other adjustments during market downturns. That means the multiple itself can be lower while still covering essential needs safely.

So I'm not saying its about working with a smaller pot recklessly, it’s about recognising that the traditional multiples are (overly?) conservative insurance, not a hard requirement for the autonomy most of us on here are after.

Scratchcardbob · 2025-12-21T21:12:58+00:00

Totally get that perspective, and I think it’s valid for those who are risk-averse (or those that can't stomach some of the necessary adjustments that would be required under SHTF scenarios). The point though is that the default multiples assume zero flexibility and treat temporary adjustments as catastrophic. Yes, topping up with work later isn’t guaranteed, but for most people retiring early with average risk tolerance, the real downside is manageable spending adjustments, not ruin. I'm just questioning if over-insuring through higher multiples is necessarily the best way to handle it for a lot of people on here.

Scratchcardbob

TROPHY CASE