Mr. 39 Months “Drawdown” plan

Draw Down Plan

Several FIRE-related blogs (see below) have started a blog chain on how they are/plan to draw down their savings over their retirement. There are an infinite number of ways to do this, and a lot of its based on your own particular issues/resources.

It’s a topic that isn’t covered very much, and when I stumbled onto it today, I read just about every link I could.

I thought I’d join the chain and list my plan.

Expected resources at time of retirement (July 2020)

  • Savings: $132K
  • Deferred Income from work: $179K**
  • Brokerage Account: $94K
  • Inherited IRA from my father: $137K
  • 401K/IRAs: $546K
  • Roth IRAs: $257K
  • Total: $1,345K liquid assets
  • House: $298K (not depending on it unless absolutely necessary, i.e. no reverse mortgage)

** My company allows you to “defer” income from work (i.e. don’t get paid it) until a later date, up to a certain percentage. Once you leave the company, you can take it as a lump sum or as regular monthly payments over a 5 year span. You pay taxes on it as you are paid it. In the meantime, you can invest it just like a 401K

The plan

Plan is to take out $72,000 a year/$6,000 a month. We will draw this back the equivalent when we start taking social security in 2024 (Mrs. 39 months) and 2031 (Mr. 39 months). I’ve used the FireCalc to determine that, even without social security, we have over a 90% chance to go till 95, so Social Security is a bonus here.

  1. Year 0: Setup savings as base of 2X annual salary. Plus that up at the beginning of each year from investment accounts.
  2. Year 1-3: Use Deferred income to pay for withdrawals till exhausted. Note that I still have to take a portion of my father’s inherited IRA ($5K a year)
  3. Year 4-5:  Draw down brokerage account to 0. It is here that we could start getting Social Security for Mrs. 39 months
  4. Year 6-8: Draw down my father’s IRA to 0 while continuing (if possible) to get SS for Mrs. 39 months
  5. Year 9 – 25: Draw down 401K/IRA to 0. It is here that we would finally start taking Mr. 39 months social security
  6. Year 26+: Still plenty of money left over in the Roth IRA to last us, plus we have the 2X money in savings and the house, so it should enable us to be OK.

Overall, we could retire right now if I had confidence that Social Security (or at least 75% of Social Security ) would be there for us. I just don’t know, so I intend to work till July 2020 (Independence day!) to make sure we will be OK no matter what.

More Withdrawal Strategies

Here are more retirement strategies from the PF blogger community. Some of these are much more detailed than mine. Check them out!

Anchor: Physician On Fire: Our Drawdown Plan in Early Retirement
Link 1: The Retirement Manifesto: Our Retirement Investment Drawdown Strategy
Link 2: OthalaFehu: Retirement Master Plan
Link 3: Plan.Invest.Escape: Drawdown vs. Wealth Preservation in Early Retirement
Link 4: Freedom Is Groovy: The Groovy Drawdown Strategy
Link 5: The Green Swan: The Nastiest, Hardest Problem In Finance: Decumulation
Link 6: My Curiosity Lab: Show Me The Money: My Retirement Drawdown Plan
Link 7: Cracking Retirement: Our Drawdown Strategy
Link 8: The Financial Journeyman: Early Retirement Portfolio & Plan

Link 9: Retire by 40: Our Unusual Early Retirement Withdrawal Strategy



Mr. 39 months

20 thoughts on “Mr. 39 Months “Drawdown” plan”

  1. Your budget is the same range as ours, which is fun to see. Not a “shoestring budget” by any stretch of the imagination. The assets don’t support a 4% withdrawal rate, but Social Security can cover the gap for you guys.

    Most of us in the “chain gang” are much further from that possibility. It’s good to see that incorporated into a drawdown plan, and I sincerely hope it becomes a part of ours someday.


    1. Yep, my 4% right now is depending somewhat on social security. That’s why I’ve got 3 more years of working to do before I will feel comfortable that I am financially independent.

      Thanks for the comment!

  2. Welcome to the “Chain Gang”. You have a well thought out #DrawdownStrategy. I like your plan of keeping a couple of years in cash. Our first plan is to draw our brokerage account to zero too. We are looking at doing that for the first 10-12 years. After that, we will tap my wife’s traditional IRA and Social Security when she turns 70.

  3. Another link in the chain!
    Nice strategy. Is it possible you’ll feel more secure about getting at least 75% of your social security? And pull the trigger earlier?

    1. We could. The issue is one of trust. The money just isn’t there, and with many US states facing bankruptcy (IL, NY, NJ, RI, CT, etc.) I think it will be hard to make a judgement based on other people’s decisions. I feel more comfortable being in control than trusting the politicians.

      I have an older brother that hasn’t saved much for retirement, and because of that, he is led by his nose by whichever politician shouts the loudest “they are going to destroy social security.” I never want to be like that.


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