41 and looking forward to ER

[runchman]

Hi all,

* New to the board, 41 and married with 2 daughters, 9 and 4 years old. Looking to retire in maybe 10 years or so, here's my situation:

* 401(k), IRA savings: 475k
* taxable savings:* * * *155k
* Home value: 285k, Equity 140k

* I'm a software guy that hasn't yet lost his job to someone overseas. Plugging away at my 401(k), and should have my mortgage gone in less than 10 years.

I own a small laundromat that provides about $1500 per month income, currently used to build investment portfolio and reduce debt.* *

* Now if I can just avoid getting laid off since I spend most of my day running portfolio projections and tweaking my spreadsheets, instead of doing real 'work', I just may meet the ER goal in 10 years

- John

[JonnyM]

I'm nearly at your target place, age 50 with a target of early next year. Similar profession, more of a hardware guy, but I get where you're comin' from.



Fave really old Programmer joke:

How many Software Engineers does it take to change a lightbulb?




Can't be done, it's a hardware problem.

Not a day (workday that is) goes by that I don't stare lovingly at that spreadsheet.

[runchman]

Well, I do test equipment programming type stuff, so I'm pretty close to the hardware. Have to get my hands dirty, I can't handle just pure software.

Originally Posted by JonnyM

Not a day (workday that is) goes by that I don't stare lovingly at that spreadsheet.

* What a great quote. I love my spreadsheets -* are we a bunch of geeks or what?

[riskadverse]

Now if I can just avoid getting laid off since I spend most of my day running portfolio projections and tweaking my spreadsheets, instead of doing real 'work', I just may meet the ER goal in 10 years

Looks like you're on or ahead of schedule - I found that getting laid off had not too much to do with real 'work'. Nobody knew what I did my last 5 years as a programmer - (and it wasn't real 'work' - at least for the man).

[runchman]

That's one of the great things about programming - nobody really knows how long something should take.

Tell 'the man' it will take 2 weeks; spend 9 days tweaking the spreadsheets, one day cranking out the work. Gotta love it!

[cute fuzzy bunny]

Hmmm...when I did software I told the boss something would take 2 weeks when I thought it might take 4, then he told me to do it in 1.

Clearly I was doing something wrong. Of course, I was about 18-19, so that probably had something to do with it.

Fueled by a steady diet of mountain dew and hostess cherry pies, it got done though...

[SilverLining]

Umm.. if you have around 600k in assets, and an income of 1,500 a month off of a laundromat.. WTF are you doing still looking at spreadsheets? That is 3,500 a month in income or $42,000 a year.. certainly enough to retire on is it not?

[cute fuzzy bunny]

By the skin of your teeth.

[retire@40]

Originally Posted by SilverLining

Umm.. if you have around 600k in assets, and an income of 1,500 a month off of a laundromat.. WTF are you doing still looking at spreadsheets?* That is 3,500 a month in income or $42,000 a year.. certainly enough to retire on is it not?

What if a better, cleaner, cheaper laundromat opens next door to his after he retires? I think it may be better to build up those assets closer to $1 mil+ before calling it quits.

[laurence]

Or see if you can sell the business, "Hey, $1500 a month, that's worth $400,000 SWR according to this program called Firecalc!"

[runchman]

I couldn't do it right now, given 2 college educations at some point in my future, a current mortgage payment of about 1900 per month, and having to pay for healthcare out of my pocket if I retire.

So no, 42k a year doesn't cut it right now. Someday, yes, but not yet.

I do like the valuation for my laundromat though! Unfortunately those sell for 3 to 5 times NET yearly income, so it is only worth about 80 to 90k.....

[SilverLining]

I am going to guess wildly you are on a ten year mortgage (I am and have a similar payment).. you could knock that off with your taxable investments instantly (of course bringing down your nest egg).. pick up health insurance for $600 a month through blue cross (look into your local plan).. and take the remainder of your taxable savings and plop them into 529's for tax free growth.. around $45k total should cover both kids for a state school.

I guess it depends on what you want...

[uncledrz]

Originally Posted by SilverLining

Umm.. if you have around 600k in assets, and an income of 1,500 a month off of a laundromat.. WTF are you doing still looking at spreadsheets?* That is 3,500 a month in income or $42,000 a year.. certainly enough to retire on is it not?

runchman's got his head on straight. two kids, still a mortgage, with maybe 40-50 years more on this earth, nah, 42,000 a year won't do it.
wait till the kids are all grown, mortgage paid off, soc. sec. closer/pension on the way, maybe, but not with college coming up in 8 years.

[runchman]

Originally Posted by SilverLining

I guess it depends on what you want...

That sums it up quite well. Could I payoff the (12 year or so left) mortgage and potentially live off the portfolio? Maybe, but just maybe. Am I willing to chance it? Nope, not yet, the attraction just isn't strong enough yet.

And maybe I didn't mention a car payment too because I didn't want to get flamed

[Jarhead*]

Originally Posted by runchman

That's one of the great things about programming - nobody really knows how long something should take.

Tell 'the man' it will take 2 weeks; spend 9 days tweaking the spreadsheets, one day cranking out the work. Gotta love it!

You're too young to consider retiring now with the responsibility of two children in the household.

By the way, according to your grueling work schedule, wouldn't retirement be redundent?

I know you were just getting opinions, but you have to be careful about that on this board also.

Hang in there, see you in about 10 years or so.

[SilverLining]

Well, the original poster could basically "cruise" with an easier, less stressful job that brought in supplemental income to the "main income" of the portfolio. This could be contract work which would go up and down depending on the portfolio peformance- and also allow reentry into the job market full time if needed.

I don't see why $42,000 is needed- we live off something like $25,000 currently and have everything we like.

(Yeah, you might have to sell the new car and stuff)

[MRGALT2U]

Originally Posted by SilverLining

I don't see why $42,000 is needed- we live off something like $25,000 currently and have everything we like.

Ditto!

[cute fuzzy bunny]

Except to live in a decent home in many areas, drive a decent car, and factoring in ALL of your actual expenses, plus factoring in capital costs of fixing and replacing stuff around the house...or inflation if you're renting...I'm not sure you can do 24-25k on a sustained basis without really cutting the pleasures of life to the bone.

John - does that 25k include your wifes income or is that just the money that comes off your junk bonds?

[MRGALT2U]

Originally Posted by Notth

Except to live in a decent home in many areas, drive a decent car, and factoring in ALL of your actual expenses, plus factoring in capital costs of fixing and replacing stuff around the house...or inflation if you're renting...I'm not sure you can do 24-25k on a sustained basis without really cutting the pleasures of life to the bone.

John - does that 25k include your wifes income or is that just the money that comes off your junk bonds?

That 25K is DW income (PT) plus bonds/CDs. No SS yet (14 months,
18 days and counting).

JG