December Safe Withdrawal Rate – 37.67%

December’s SWR was 37.67 compared to 38.87% in November. That was a slight improvement. My goal is to get the SWR down to 4% so the lower my SWR is the better. That goal is probably many years from being met. The 4% SWR translates into having 25x your annual expenses in savings or 300 months of expenses in savings. Once I reach that point I will consider myself financially independent.

I have 31.85 months of living expenses saved which is a slight improvement compared to 30.86 months of living expenses saved in November. I calculate my months of living expenses saved by dividing the average of my trailing twelve months of expenses by my total money saved.

Considering I didn’t make much money in December any improvement is good. I think I’m going to stop calculating these numbers for the next few months while I’m working full-time and do a post on the percentage of my income saved/paid towards student loans instead. Would you rather see that post? or both? or neither?

6 thoughts on “December Safe Withdrawal Rate – 37.67%”

  1. Is paying your student loans a priority? If so, then posting a progress meter will help you stay on track. The SWR has always been a little confusing to me. It’s easier for me to understand that your goal is to have 300 months of living expenses banked, and that you currently have 31.85 months of expenses set aside.

    • Paying off my student loans isn’t a priority mainly because it is an impossibility with my current income. If my income were to triple then paying off my student loans would be a realistic goal. The months of expenses saved might be a better measure. It would certainly be easier to understand and it would be easy to see my progress or lack of progress.

  2. I would like to see percentage of income saved, I can relate to that. Also student loans are an ulgy green monster everyone hates.

    • It would be pretty easy to do both. I think I will do both, but I will now make the months of expenses saved the focus rather than SWR.


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