Am I fooling myself about ER?

[seraphim]

Ignore the 'percent of income' requirement. We're living very well on a 50% reduction with no lifestyle change. It depends on your personal situation and lifestyle. No one can advise you until you know your expenses.

Using the 54.5k calculated above, and assuming that's a pretax amount, you might - depending on state and local taxes - be looking at $44k net income, or about $3600 a month ( estimating in my head lol). You have to determine if you can live within that amount, and handle any financial emergencies that come. What if you need long term care? LTC insurance? Medical bills can eat up investments quickly.

For comparison purposes, DW and I can manage on $3800 net pension ( after taxes and health insurance) a month. We have some minor debt disappearing in the spring, and $650 no interest truck payment ( to haul our RV). We also assist our son slightly ad he attempts to start career. When those obligations are cleared up, that'll decrease our expenses about $1200 a month. We do a 2% draw because we like to travel. That money is strictly for fun stuff.

So, it's entirely possible for you to live on $3600 a month. My concern would be emergencies which eat into your savings, thus reducing your future income as cost of living increase.

Just my two cents.

 

[Katsmeow]

I still a believer in a minimum of 65 - 75% of income for an active retirement. You will likely need at least 70% if you need to purchase health care.

DH retired in 2010 and I went to very part-time work. This year our spending is roughly 40% of what we earned in our last year of full-time work. However, we have 2 adolescents at home one of whom is in college. So, we have a lot of expenses due to still having kids at home and in college. Once the kids are gone, I expect our spending to be between 20% and 25% of what we earned. FWIW, our standard of living hasn't changed.