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Can I reach FI in 11 years? Age 29.
Old 02-12-2015, 10:45 AM   #1
Confused about dryer sheets
 
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Can I reach FI in 11 years? Age 29.

Married and age 29. All values below are combined for my spouse and I.

Expenses
$4200/mo. I have tracked this over the course of a couple years and can provide more details if helpful. Mortgage of $250k and one low interest student loan $5k.

Expected Retirement Expenses
During retirement I'd like to plan on $4000/mo income. Adding in health care but subtracting out mortgage payments. No children planned at this time, and parents are doing well financially. $200/mo is currently being set aside for major home repairs. No major lifestyle changes planned.

Retirement Income
My wife and I both have 2nd jobs we enjoy that bring in $15,000/year. We will continue at least that pace.
Pension is $400/mo if working until 40 and collecting immediately.
Pension is $4000/mo if working until 40 and collecting at 65.
SS at full retirement (67) is $4000/mo [EDIT: not sure about this value if employment stops early]

Savings
Net Worth - $220k. Retirement Accounts - $165k (75/25 Equities/Bonds. Average ER 0.09%)
401k's - $100k
Roth IRA's - $65k
HSA's - $1k
Checking/Savings - $25k
Saving 50% of our pre-tax income this year. That's a combination of the above funds and paying down the mortgage.

The plan will be to pay off the mortgage in 11 years and save up as much as possible. $25k/year to mortgage payments and $50k/year to retirement accounts. With 5% real returns and an increase of 2% each year towards retirement savings I'd hope to cross over $1mil by 40.

FireCalc shows if spending is $48k/year and $1mil in retirement, 98% chance of making it to age 65. This doesn't factor in extra income in retirement to be conservative.

2015 is the first time I really started looking into FI at an early age. Advice is appreciated. Thank you!
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Old 02-12-2015, 11:30 AM   #2
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your social security estimate assumes current income until 65, so that is off. (Other calculators, including one at the social security website, allow customization; in any event, I'd recommend not including it at all given your age. I still don't (at 55), but it is beginning to look like we might get a pleasant surprise.)

It is a long way off with many variables. But, you probably can do it, especially if you continue post retirement with the 2d jobs/SEmployment that you apparently enjoy. Either way, if you shoot for that target (even if you choose not to bail at 40), you will put yourselves in fantastic shape for just about any eventuality. (And bravo at the 50%!)
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Old 02-12-2015, 11:54 AM   #3
Confused about dryer sheets
 
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Thanks! For the $50k/year to retirement accounts the plan is to max out the HSA, Roth IRA's, and then put the rest into 401k accounts.

At what point should I start thinking about how to withdraw my money early? Are there some good resources for this?
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Old 02-12-2015, 12:31 PM   #4
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Tons of resources on early withdrawals from tax-privileged accounts. Tax laws are not set in stone though.

Here are a couple of google search links: Google and Google

Also, search this site, bogleheads, MMM, and gocurrycracker.

72t, and withdrawal of roth principal are two oft-cited routes.

Also, for now, if you don't touch your HSA, but save all of your eligible receipts, you can withdraw those sums at later point.
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Old 02-12-2015, 12:35 PM   #5
Confused about dryer sheets
 
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I'll start researching, thanks. Mad Fientist inspired my switch to a HDHP with an HSA for 2015. If I can I'll pay for all medical expenses out of pocket and save the receipts.
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Old 02-12-2015, 07:35 PM   #6
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Welcome to the forum.
Look at Roth conversion ladders

If you can save 50%, I think MMM says you can retire in about 15 years from when you start saving 15%.
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