Re: What\'s your retirement nut?
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I also disagree about having to invest solely in munis. While it certainly is a good idea to limit your risk during retirement, investing risk free would be foolish imo. Getting some exposure in stocks and other types of bonds can give your portfolio some juice with an acceptable level of risk.
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Market risk is overrated. Most people take it because they need the extra returns and compound interest to hit their nut. However, if for whatever reason you are able to hit your nut through the lottery, an inheritance, a few good yeats on Wall Street, whatever--going crazy with market risk is a fool's errand. My goal would be to get 1% real return (ie, after taxes and inflation) with $10M in the bank. With $5M, I'd need 2% real return, which is harder to get, and you introduce a volatility to your nest egg. Dont forget that if you're looking to retire early, and you figure you might well live to 100, you've got to figure that you're already facing a fair amount of unavoidable volatility just from things like inflation, interest rate fluctation, political/taxation risk, government entitlement risk, healthcare cost risk, etc. Why add to it by stacking market risk?
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