Dr. Karsten, creator of the Early Retirement Now blog and a former Federal Reserve economist, dives into the fascinating world of early retirement. He shares strategies for safe withdrawal rates and discusses the importance of tailored financial plans. Health insurance options for retirees, particularly the benefits of MediShare, are explored too. Additionally, he examines innovative investment strategies and the implications of market trends, emphasizing risk management and the future of stock returns. His insights are perfect for anyone considering the FIRE lifestyle.
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Karsten's Early Retirement Journey
Karsten realized in 2008 he wouldn't work until 67 after experiencing job instability early in his career.
He saved 50-60% of his income for 10 years, enabling his early retirement in 2018.
volunteer_activism ADVICE
Tailor Your Withdrawal Rate Carefully
People must personalize their safe withdrawal rate considering age, pensions, and retirement length.
Small percentage differences in withdrawal rates translate to significant annual income changes, so precision matters.
insights INSIGHT
Valuations Affect Withdrawal Safety
The 4% rule's historical success rates ignore current expensive equity valuations and low interest rates.
Conditioning withdrawal success on today's market conditions reveals higher failure risks than traditional studies suggest.
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Our guest in this episode is Dr. Karsten. He's the mind behind the Early Retirement Now blog. He completed a PhD in economics, worked for the Federal Reserve for a while and taught economics. He joined the research department of an investment manager and got a CFA designation. He spent 10 years there before punching out to live the FIRE lifestyle a few years ago. He spent the first few months out on a world tour, visiting 20 plus countries, then settled down in the Northwest with his family. Early Retirement Now is a popular FI blog primarily because of Karsten's rigorous academic approach. We explore health insurance and withdrawal rates and strategies for early retirees and get his take on some controversial areas of finance like options and leverage. Interested in retiring early? Check out How to Retire Early as a Doctor. https://www.whitecoatinvestor.com/how-to-retire-early/
Today’s episode is brought to you by SoFi, helping medical professionals like us bank, borrow, and invest to achieve financial wellness. SoFi offers up to 4.6% APY on their savings accounts, as well as an investment platform, financial planning, and student loan refinancing…featuring an exclusive rate discount for med professionals and $100/month payments for residents. Check out all that SoFi offers at https://www.whitecoatinvestor.com/Sofi *Loans originated by SoFi Bank, N.A., NMLS 696891. Advisory services by SoFi Wealth LLC. The brokerage product is offered by SoFi Securities LLC, Member FINRA/SIPC. Investing comes with risk including risk of loss. Additional terms and conditions may apply.
The White Coat Investor has been helping doctors with their money since 2011. Our free financial planning resource covers a variety of topics from doctor mortgage loans and refinancing medical school loans to physician disability insurance and malpractice insurance. Learn about loan refinancing or consolidation, explore new investment strategies, and discover loan programs specifically aimed at helping doctors. If you're a high-income professional and ready to get a "fair shake" on Wall Street, The White Coat Investor is for you!
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