46 and counting down....

[mjb3]

Hello everyone, just joined this forum and love it. So I'm plunging in with my snapshot:

Sales engineer in Detroit, I'm 46(wife 47) married 10 yrs -no kids.

Total liquid = $650k - $500k in IRA(half roth/half rollover), $100k in 401k, $50k cash. 11 yrs to go on mortgage on house worth $300k(and dropping). $300k in lakefront real estate(as investment - low tax basis). May decide to build on the lakefront lot as retirement home, but now just holding it for waterfront property to rebound in 8-10 yrs.

Would like to retire at 55, hoping bull market continues at better returns over next 10 yrs than the last 10. Can we hope for 9-10% going fwd ? Wife and I have no pensions, just ss.

My rule of thumb has been to retire(and live off 4% draw), I would need $2 m(w mortgage) or $1 m ( w house paid off). Our situation is unique(no college, weddings to fund) so I wonder what you guys think of our projections?

 

[HawkeyeNFO]

what's the mortgage and equity on both properties?

Just curious, but which lake?

 

[mjb3]

Mortgage on house $218k

No mortgage on land(Lk Mich)

 

[Sandhog]

Mortgage on house $218k

No mortgage on land(Lk Mich)

Did you refinanced your house with lower interest rate? I would pay off the house first before holding lots of cash on hand especially at current interest rate. I do believe with your current Roth and 401K, it should reach $1 million range by time your wife turn 55. However, at that time would $40K year would be enough. I have a bad feeling about inflation lurking in later part of 2012 after the election that would mirror similar to late 70s and early 80s. If it happens, I don't think too many of us will be able to retire. We have to work till the dying day.

 

[obgyn65]

Welcome mjb3. First you may need to calculate your monthly expenses. Then enter your data on Firecalc and here: See Where You Stand | Merrill Edge Retirement to run simulations.

 

[robbridg]

Welcome! Try FIRECALC out with some different scenarios. Sorry to hear about your real estate holdings. My wife and I escaped the Metro D area 4 years ago.

 

[mjb3]

Sandhog,

Mortgage on house decent rate 4.5% fixed, 15 yr. Not worth paying down early - pretty cheap money. If I do have over $1m by 55, still not sure if the $40k will be enough. That's where I'm hoping to have $1.5 m( $60k) by that time. But we all know what the last 10 yrs have been like. I think the real estate(waterfront) will come back but it will be 8-10 yrs away.

Robbridg,

Only good thing about D's market is that it never went up like Nev, AZ. So doesn't fall as much. But region will never be like it was in 50s or ever the 80s. Time moves on. I bought it 1999, so I'm close to even. Anyone who bought in 2004/2005 I don't envy.

 

[Sandhog]

Sandhog,

Mortgage on house decent rate 4.5% fixed, 15 yr. Not worth paying down early - pretty cheap money. If I do have over $1m by 55, still not sure if the $40k will be enough. That's where I'm hoping to have $1.5 m( $60k) by that time. But we all know what the last 10 yrs have been like. I think the real estate(waterfront) will come back but it will be 8-10 yrs away.

That is a great fixed rate. I agreed at that fixed rate I would pay off early either. In couple more years, I got a feeling that we'll be earning at least 5% on savings account which means you are making .5 % from your mortgage. You'll be the one of very few people took advantage of the bank.

 

[leftymd]

Tunnel stiff

Hey Sandhog

Do you run a jackleg and carry around a muckstick ?

 

[Sandhog]

Hey Sandhog

Do you run a jackleg and carry around a muckstick ?

Only if we are drilling and blasting. I don't work on the field anymore.

 

[leftymd]

Tunnel Stiff

Only if we are drilling and blasting. I don't work on the field anymore.

Nice to see other tunnel stiffs on this site.

I've seen a lot of change in underground construction in the 35+ years I've worked in it. ER'd last year after having worked in DC, Balt, Boston and out west. Moves & travel eventually take a toll....even tho' the pay & satisfaction is there.

All the best

 

[travelover]

Welcome from another metro Detroiter - I live in the fringes out toward AA.

 

[freebird5825]

Hello from upstate NY.

 

[mjb3]

Travelover,

Let's hope the worst is over for our region(Metro Detroit) and the auto industry. I'd be happy if I didn't lose 10% every yr on my house! Never mind it ever appreciating again, just to stop the hemmoraghing

 

[travelover]

Travelover,

Let's hope the worst is over for our region(Metro Detroit) and the auto industry. I'd be happy if I didn't lose 10% every yr on my house! Never mind it ever appreciating again, just to stop the hemmoraghing

I looked at Zillow yesterday and it claims that my house is worth less than 1/2 of what I paid for it in 1989. I guess I'm not going anywhere for a while.

 

[Sandhog]

Nice to see other tunnel stiffs on this site.

I've seen a lot of change in underground construction in the 35+ years I've worked in it. ER'd last year after having worked in DC, Balt, Boston and out west. Moves & travel eventually take a toll....even tho' the pay & satisfaction is there.

All the best

Yeah, I've been around myself. As I got older, it was getting harder and harder to shape when I didn't get on a gang. Also, there are lots of politics with union when they put their favorite guys on the bellman job. Money was good and did enjoy working but it does take a toll on you. Besides, all that I worked went to my ex-wives anyway so all I have is the memories or hard hats day and wasted nights. (unless I was working either swing and graveyard shifts)

I'm glad you are ER and hopefully enjoying yourself. Be well.