Usually at this time of year I publish a year in review which covers a little of the qualitative and a lot of the quantitative. Given the year we’ve just had, along with quantitative needs now being significantly lessened given the stage of my FIRE life I’m currently in, I feel it’s worthy to flip that weighting as it really has been a year to both remember and to forget. Additionally and hopefully once you see the qualitative you’ll understand why it’s been a long time between blog drinks.
So let’s get the quantitative stuff out of the way. In my purist FIRE plan I was aiming to spend the lesser of:
- up to 2.5% of initial FIRE wealth plus investment expenses of around 0.2% uprated for inflation annually. For 2020 that gave me a drawdown target of around £26,084 plus investment expenses.
- up to 85% of my annual dividends. Dividends were a car crash this year. Once the laggards make their final payments I expect them to be down around 29% year on year. For 2020 that gave me a drawdown target of around £19,848
Click to enlarge, RIT Annual Dividends
In comparison, during year 2 of FIRE, I withdraw from my wealth a total £19,022. I met my FIRE goals but boy did it occur unconventionally. So let’s switch to the story to explain that which is hopefully the interesting bit.