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Hello,I'm Ricky!
Old 10-13-2010, 08:12 PM   #1
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Join Date: Oct 2010
Location: Savannah
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Hello,I'm Ricky!

Hello guys and gals:

I'm 26 and am a superintendent at a chemical plant. My salary is 50,000 with a standard 401(k) (50% of first 5%). We work tons of over time, like 84 hour weeks, but I don't factor that into our plan.

My wife is 28 and is beginning her career as a Physician Assistant. Her contract should range around 76-89,000 within the next couple weeks.

I have a Roth IRA with about 21,000 and we will start Sarah's as soon as she gets her first check.

We are very lucky because my mawmaw is going to leave us between 210-350 K when that time comes.

My wifes family is well off but since I have never seen anything in writing I will factor them at 0.

Our plan:
Her: Roth (till we get phased out), 401(if offered), basic bills, day to day spending
Me:Roth(till we get phased out), 401(k),her loans (125,000 for PA school), eliminate debt and invest it all

Basic Plan: Live off her, act like mine does not exist and invest as much of it as possible

The money we get from our family will be invested VERY CONSERVATIVELY. They worked to hard for me to gamble with it.

We are in Savannah with a low cost of living. We are looking at homes from 120-150.

We are thinking about 50-55 for retirement and counting on 0 from social security.

PLEASE TEAR MY PLAN APART!!! Im looking forward to being a member!
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Old 10-13-2010, 10:32 PM   #2
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Join Date: May 2007
Posts: 1,516
Welcome!

There's not much to pick apart. You have the outline of a successful FIRE plan. In very broad, overly simplistic terms:
  • Your inheritance amount will more or less equal the mortgage and education debt. The timing isn't known, of course, but for simplicity I'm canceling these out in estimating a retirement age net worth.
  • Reading between the lines, I believe you are describing a spending budget in the $60,000 per year range.
  • After taxes, and with a continuation of overtime, you and your wife may be able to save roughly the same amount every year.
  • Your target retirement year is 25-30 years away.
  • 25 years x annual savings equal to your annual spending + investment returns equal to inflation = a retirement nest egg equal to 25 years' spending needs, or FI
  • The generic safe withdrawal rate (SWR) for a retirement nest egg is about 4%
A second inheritance and/or investment returns that beat inflation will get you to FI quicker.

Now about those details...read, learn & plan. You'll find plenty of help and encouragement here.
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Old 10-14-2010, 07:43 AM   #3
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Join Date: Mar 2007
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Congratulations on starting financial planning at an early age.

My only comments are:

1) Never count on an inheritance until the check clears. Many things can happen, including years of nursing home care

2) Life happens. Focus on the long term, but enjoy yourselves along the way.
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Old 10-14-2010, 08:26 AM   #4
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Quote:
Originally Posted by travelover View Post
Congratulations on starting financial planning at an early age.

My only comments are:

1) Never count on an inheritance until the check clears. Many things can happen, including years of nursing home care

2) Life happens. Focus on the long term, but enjoy yourselves along the way.
+1. and welcome.
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Old 10-14-2010, 12:03 PM   #5
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Location: Denver
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Welcome!
The key to hitting your targets is continuous employment, control over your spending and STAYING married.

My advice would be to get in the habit of tracking your spending and examining it regularly to make sure your spending is bringing you the value/satisfaction/fulfillment that you want. Once you have a handle on your spending, then use Firecalc.

Invest time & effort in your careers & marriage.

Children?
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