Hi - first timer - How am I doing with retirement planning?

[trueson1]

Just found this website. Been doing my own investing all my life. Following Bogelheads for several years and other self investor sites.

I am 61.5 and my DM is 62. Plan to retire at 65.

I would appreciate a portfolio review.



A. Me

Company 401K

1. VTWNX - Vanguard 2020 tax-deferred IRA – 400K
2. VTTVX -Vanguard 2025 tax-deferred IRA - 50K
Adding 60K per year for next 4 years and rolling over 18K after tax to Vanguard Roth each year for next 4 years

Individual Vanguard Investments – Mutual Funds and ETFs

Tax Deferred IRAs

1. VTSAX - Total Stock Market Adm - 95k
2. VBTLX - Total Bond Market Adm- 180K
3. VTIAX - Total Int. Stock Market Adm- 100K
4. VGSLX - Reit Index Adm - 16K

ROTHS
1. VTIAX - 2025 – Roth - 20K
2. VPU - Utilities ETF – Roth - 15K


B. DM

Individual Vanguard Investments – Mutual Funds

Tax Deferred IRAs

1. VBTLX - Total Bond Market Adm- 50K
2. VTSAX - Total Stock Market Adm- 75K


ROTH
1. Total Stock Market Adm - Roth - 50K



Summary of Entire Retirement Portfolio

Tax deferred – 990K (addition of another 150K over next 4 years)
Roths - 100K (addition of another 72K over next 4 years)


Taxable Portfolio – combined for me and spouse

Mutual Funds
VWIUX - Vanguard Tax Exempt - 49K
VTSAX - Total Stock markey Index Adm - 88K
VOO - Vanguard S&P 500 Index - ETF 17K

Cash Assets
CDs, banks accounts, emergency funds - 85K
Company stock as RSUs - 100K

Total Taxable Portfolio - 339K


Total combined assets - ~1.4M

Estimated other Income at retirement:
SS: 48K annual
Company Pension: 26K annual

Question: I would appreciate advice on consolidation and re-allocation at retirement in 4 years to generate ~120-130K annual income.



Are we on target?

 

[pb4uski]

Yes, I think so. Assuming that a 3.5% WR is suitably conservative for a 65 yo retiree.

Spending................. 125k
Pension......................26k
SS.............................48k

Gap...........................51k
WR............................3.5%

Needed..................1,457k
SS substitute...............26k (for ER at 65 to start of SS at 66)

Total needed............1,483k


Tax-deferred..............990k
Roths........................100k
Taxable.....................339k

Subtotal.................1,429k
Tax-def additions........150k
Roth additions.............72k

Total......................1,651k

 

[trueson1]

Yes, I think so. Assuming that a 3.5% WR is suitably conservative for a 65 yo retiree.

Spending................. 125k
Pension......................26k
SS.............................48k

Gap...........................51k
WR............................3.5%

Needed..................1,457k
SS substitute...............26k (for ER at 65 to start of SS at 66)

Total needed............1,483k


Tax-deferred..............990k
Roths........................100k
Taxable.....................339k

Subtotal.................1,429k
Tax-def additions........150k
Roth additions.............72k

Total......................1,651k

 

[Surewhitey]

+1...looks good to me. I'm at ~1.2m at age 47 and hoping to do the same in a few years. DW isn't on board yet, but I'm working on her. We have traveled "extensively" this year and still only spent $3,500 / month, so I don't need your kind of $$ to have a great ER.

"Yes, I think so. Assuming that a 3.5% WR is suitably conservative for a 65 yo retiree.

Spending................. 125k
Pension......................26k
SS.............................48k

Gap...........................51k
WR............................3.5%

Needed..................1,457k
SS substitute...............26k (for ER at 65 to start of SS at 66)

Total needed............1,483k


Tax-deferred..............990k
Roths........................100k
Taxable.....................339k

Subtotal.................1,429k
Tax-def additions........150k
Roth additions.............72k

Total......................1,651k"

 

[MBAustin]

Welcome trueson! If you haven't found them already, we have a helpful list of things to think about during your planning:

Some Important Questions to Answer

Have you run scenarios in FIREcalc (link at the bottom of each page here) or other retirement calculators?

In terms of consolidation and re-allocation to generate income, remember that you will have RMDs to deal with only 5 years after retirement. So your plan for the first few years will be different from later on. I suggest searching the forum here for "withdrawal" as there are many threads talking about various strategies for switching from the accumulation phase to the decumulation phase.

Also, if you aren't already, many of us would suggest keeping very good tabs on your spending for the next couple of years. You may find that you'll need less than you think once you actually retire (or more - but at least you will know). Many of us also plan to adjust our discretionary spending in the event of a market downturn rather than to stick with a strict percentage withdrawal strategy. YMMV.

Welcome and we look forward to your contributions.

 

[trueson1]

Yes. I've run Firecalc but haven't looked at various withdrawal scenarios.

Thanks! I'll do that.

 

[Rianne]

IMHO, you are in good position. We are closer to 2M at 60 yrs. old with $44,000K in SS at 67.5 yrs old. Pension 12k at 65 yrs. old. Our big concern is Health Insurance, but you will have Medicare at 65 if you decide to wait that long.

Spending varies, there's no absolute hard and fast rule and it may change. I recently had a big health issue, hospitalized, may need surgery if this does not correct itself. We may need a car in the next year. Spending ebbs and flows. You are on solid ground and fluctuations should not hurt your overall goal. The nice bull market helps.

The best of luck to you!