Join Early Retirement Today
Reply
 
Thread Tools Search this Thread Display Modes
Just Retired
Old 10-23-2017, 05:24 PM   #1
Confused about dryer sheets
 
Join Date: Oct 2017
Posts: 8
Just Retired

I just now retired but bought the business I worked for only three years ago after working there for 20 years. I have 600k in 401k and 500k in other stocks. I will have a $350,000 salary for the next two years until I sell the business and will likely save an additional $300k net of this salary. So with investment growth I should have $1,650,000 ish in two years when it all stops. I know this is really not enough as I'm now 55 and my wife is 49, she works part time and every penny goes to my daughters college. She will retire as soon as the daughter graduates.

Here is the rub, I should be able to take $1 million tax free when I sell my business but it's never a sure thing until the money hits the bank. There is roughly another $1 million in inheritance heading my way in the next ten years.
We have no other debt with cars and home worth $400k paid for and can ride the company health insurance for several more years.

Thoughts?
__________________

Silverton34 is offline   Reply With Quote
Join the #1 Early Retirement and Financial Independence Forum Today - It's Totally Free!

Are you planning to be financially independent as early as possible so you can live life on your own terms? Discuss successful investing strategies, asset allocation models, tax strategies and other related topics in our online forum community. Our members range from young folks just starting their journey to financial independence, military retirees and even multimillionaires. No matter where you fit in you'll find that Early-Retirement.org is a great community to join. Best of all it's totally FREE!

You are currently viewing our boards as a guest so you have limited access to our community. Please take the time to register and you will gain a lot of great new features including; the ability to participate in discussions, network with our members, see fewer ads, upload photographs, create a retirement blog, send private messages and so much, much more!

Old 10-23-2017, 05:34 PM   #2
Thinks s/he gets paid by the post
 
Join Date: Mar 2004
Posts: 2,747
Welcome, Silverton.

We need to know your annual spending before we can provide useful feedback on your situation for retirement.

omni
__________________

omni550 is online now   Reply With Quote
Old 10-23-2017, 05:44 PM   #3
Moderator
rodi's Avatar
 
Join Date: Apr 2012
Location: San Diego
Posts: 10,025
Spending is the key here. You can have a $5M nest egg - but if you spend $500k/year - you'll be at risk of running out of money.

General advice is to not count on inheritance... Nice if you get it... but better not to plan on it. Parents could have long term medical issues that eat into their money... They could decide to give it all to charity... you never know. It's their money they get to decide what to do with it.
__________________
Retired June 2014. No longer an enginerd - now I'm just a nerd.
micro pensions 7%, rental income 18%
rodi is offline   Reply With Quote
Old 10-23-2017, 05:50 PM   #4
Confused about dryer sheets
 
Join Date: Oct 2017
Posts: 8
We just completed a budget and $80k/yr is what will cover us.
Silverton34 is offline   Reply With Quote
Old 10-23-2017, 05:57 PM   #5
Thinks s/he gets paid by the post
gauss's Avatar
 
Join Date: Aug 2011
Posts: 2,504
A 5% WR resulting in $80k/yr would require a portfolio of 1.6M. Many around here would be uncomfortable with that high of a WR. On the other hand, I believe that the Financial Engines tool assumes 5%.

One thing not clear to me is how is any Social Security factored into any of this.

If you are assuming $0 SS for your $80k/yr, then introducing SS may significantly lower your WR.

-gauss
gauss is offline   Reply With Quote
Old 10-23-2017, 06:01 PM   #6
Confused about dryer sheets
 
Join Date: Oct 2017
Posts: 8
I'll likely take SS at 62 which is 6.5 years out. I've paid the max into SS for 20 years now but don't know what to expect at 62.
Silverton34 is offline   Reply With Quote
Old 10-23-2017, 06:05 PM   #7
Thinks s/he gets paid by the post
 
Join Date: Mar 2004
Posts: 2,747
Quote:
Originally Posted by Silverton34 View Post
I'll likely take SS at 62 which is 6.5 years out. I've paid the max into SS for 20 years now but don't know what to expect at 62.
There's a SS estimator here:
https://www.ssa.gov/retire/estimator.html

omni
omni550 is online now   Reply With Quote
Old 10-23-2017, 06:08 PM   #8
Moderator
rodi's Avatar
 
Join Date: Apr 2012
Location: San Diego
Posts: 10,025
You can get accurate SS numbers by creating an account on ssa.gov.
https://www.ssa.gov/myaccount/
Or you can run the retirement estimator on the SSA.gov site
https://www.ssa.gov/retire/estimator.html

You can put in "0" for earnings for years between when you plan to stop earning SS income and when you collect.
__________________
Retired June 2014. No longer an enginerd - now I'm just a nerd.
micro pensions 7%, rental income 18%
rodi is offline   Reply With Quote
Old 10-23-2017, 06:11 PM   #9
Moderator
rodi's Avatar
 
Join Date: Apr 2012
Location: San Diego
Posts: 10,025
BTW - welcome to the forum.

Have you considered running firecalc? (Link at bottom of page). You'll need to know your annual GROSS spending (including taxes, health insurance, etc)... You can put in your and your wife's SS estimates and years they'll start... Be sure to fill out all the tabs. Be aware that it defaults to a 75/25 asset allocation - so adjust that as appropriate.
__________________
Retired June 2014. No longer an enginerd - now I'm just a nerd.
micro pensions 7%, rental income 18%
rodi is offline   Reply With Quote
Old 10-23-2017, 06:12 PM   #10
Confused about dryer sheets
 
Join Date: Oct 2017
Posts: 8
Will it hurt my SS benefit if I have a low salary for 4-5 years before I start drawing?
Silverton34 is offline   Reply With Quote
Old 10-23-2017, 06:35 PM   #11
Thinks s/he gets paid by the post
Ready's Avatar
 
Join Date: Mar 2013
Location: Southern California
Posts: 2,358
Quote:
Originally Posted by Silverton34 View Post
Will it hurt my SS benefit if I have a low salary for 4-5 years before I start drawing?
The SSA calculators will tell you exactly how it will affect you. With 20 years of max contributions you should be in pretty good shape, but a perfect score would be 35 years of max contributions. Hopefully you have at least 35 years of any contributions though.

What may hurt you more is claiming at 62, rather than waiting until at least 67, and preferably 70. Take a look at all three payout figures on the SSA web site and see what you think. Generally, if you are in good health and can afford to delay to 70, it yields the greatest overall payout.
__________________

Ready is offline   Reply With Quote
Reply


Currently Active Users Viewing This Thread: 1 (0 members and 1 guests)
 
Thread Tools Search this Thread
Search this Thread:

Advanced Search
Display Modes

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is Off
Trackbacks are Off
Pingbacks are Off
Refbacks are Off


Similar Threads
Thread Thread Starter Forum Replies Last Post
"Retired" nurse struggling to stay retired. CK2015 Hi, I am... 168 09-08-2015 02:36 PM
any retired or semi-retired profs here? palomalou Life after FIRE 12 11-07-2012 10:35 PM
Semi-Retired --> Retired ferco Life after FIRE 8 08-20-2009 05:08 PM

» Quick Links

 
All times are GMT -6. The time now is 11:28 AM.
 
Powered by vBulletin® Version 3.8.8 Beta 1
Copyright ©2000 - 2019, vBulletin Solutions, Inc.