Sequencing risk, dividends, and retiring at the end of a bull market

Posted on August 20, 2018 by Aussie HIFIRE

What is sequencing risk you ask? It’s having bad/negative returns on your portfolio at the wrong time, typically at or near retirement which is normally when you’ve got the most money in your portfolio. For the average Non FIRE person this generally means having negative returns on their superannuation about 5 years either side of 65 assuming that’s when they retire. Why does this matter you ask? Because that’s when you’re likely to have the most money at risk, and it can have a huge impact on your income in retirement. Continue reading →

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Fixed living costs

Posted on August 17, 2018 by Aussie HIFIRE

A large part of FIRE is cutting your living expenses as much as possible so that you can invest as much of your income as possible. There’s all sorts of other stuff that goes into FIRE, but that’s a big chunk right there. The problem is that there are a lot of living costs that can only be cut so far or are fixed. Everyone needs a roof over their heads, needs food and drink, clothes to wear and all the rest of it. Sure the amount you pay for those things can be reduced to some extent, but they’re never going to be zero. Continue reading →

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