After 20 years the Dwarf Fortress devs have to get used to being millionaires

Re:After 20 years the Dwarf Fortress devs have to get used t... by ghaff on Tuesday December 13, 2022 @07:39PM (#33978444)

If you're assuming withdrawing at a safe withdrawal rate you're assuming you're not compounding. You're assuming a safe withdrawal rate from principal/dividends/interest that will, on average, leave the principal constant. Of course, if you're older and are not looking to pass down money you may be fine with drawing down principal to some degree.

So, yes, $2m should probably be modeled at about $80K income per year before taxes without touching principal but without building savings.

(May be somewhat higher with higher interest rates/inflation.)

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Re:After 20 years the Dwarf Fortress devs have to get used t... by fnordpiglet on Tuesday December 13, 2022 @10:34PM (#33979700)

I said an annuity. An annuity would draw the principal down as well, and you generally make a drawdown assumption that leaves you with some safe margin for extended life and maybe some inheritance.

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Re:After 20 years the Dwarf Fortress devs have to get used t... by treewalking on Tuesday December 13, 2022 @11:33PM (#33980031)

If you model it as a lifetime annuity with inflation adjustment you are looking at more like 50k/year income at the outset were you to buy today.

My understanding is that annuities provide in general a worse return than the so called 4% rule on average.

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