We keep on talking about retirement. Today´s article is really important. It shows that there is not a Universal rule of thumb to calculate the amount of money needed to retire. This number is based on 3 legs: future inflation, future returns on investments, and number of years of living. If we happened to know these 3 figures, we wouldn´t have any problems finding out the wealth we´d need to retire (the same way 3 points determine a plane -I love 3-leg tables!).

As we have already exposed in a previous post (link), it is absolutely crucial the average

From this point we want to make two reasonable modifications for an early retirement scheme: 1.

As we have already exposed in a previous post (link), it is absolutely crucial the average

**P/E ratio**the year of retirement. According to Crestmont Research, if the starting P/E (Crestmont adjusted) is less than 18.6, we could even comply with the 4% rule (withdrawing 4% of total money the first year of retirement, next years same amount plus inflation, during 30 years) if we invest all our money in a portfolio benchmarked by SP500. If it´s above 18.6, the success rate is only 76%. Right now the**Schiller P/E ratio**is more than 22 according to**www.multpl.com**. So...From this point we want to make two reasonable modifications for an early retirement scheme: 1.

**instead of having everything in the stock market**, let´s imagine that we have 1/3 stocks, 1/3 bonds, and 1/3 real estate, and 2. instead of calculating everything for 30 years, let´s do it for 50 years. We´ll do it in next articles.