Zona
Recycles dryer sheets
- Joined
- Apr 26, 2013
- Messages
- 208
I have been reading this forum pretty frequently for the past five years (even registered for an account a few years ago) but felt too inexperienced to actually post anything until now. DH and I live pretty frugally and have done fairly well on the savings front over the past few years. We sock away quite a bit each year into a SEP IRA, traditional IRAs (when allowed), and our taxable accounts. We are looking at early retirement sometime around 2020 or 2021 based on our expenses and a roughly 3% withdrawal rate. The savings part up until now has seemed very straightforward -- save the extra wherever Uncle Sam will let you -- but it's the drawdown and tax implications that I want to better understand.
We have roughly 1MM in the SEP, 130K in IRAs, 260K in Roths, and about 680K in taxable. Almost all is in indexes (75% is in SPY). We don't own bonds, but we do have a paid for rental house that brings in about 8K/year after expenses. We also have a fairly large mortgage (~290K) at 3.5% on our primary home. We're still working to try to juice up the taxable accounts to help stretch us until that golden age of 59.5. Because we will have a long time horizon in ER (we're 41 and 45), we want to understand the most tax-efficient way to get at our money. So my questions revolve around understanding that before pulling the plug. Would 72t work for us? Roth conversion ladder? I know I have a lot to learn in the next 3-4 years. We are also holding back on ER a little to see what happens with healthcare (we currently pay out of pocket for a Blue Cross grandfathered plan, but premiums are sure expensive!)
A little about me: I do contract work at Megacorp, although am in between gigs right now and may become a W2 employee soon if I can't find another contract. I love travel -- especially slow travel where you really get a feel of what it is like to live in a place. DH and I have done a few trips like that. I also love learning the "fun stuff" -- have taken about a dozen online MOOC courses on edx -- art history, philosophy, jazz appreciation, French -- all the "elective" stuff I wish I'd had the time to take back in college. I have a feeling that early retirement for me would include more of both travel and learning (in addition to the occasional day puttering around the house or surfing the web...which are also things I enjoy when the mood strikes).
Anyway, this forum has been a great research tool thus far and I'm looking forward to participating more in the discussions.
We have roughly 1MM in the SEP, 130K in IRAs, 260K in Roths, and about 680K in taxable. Almost all is in indexes (75% is in SPY). We don't own bonds, but we do have a paid for rental house that brings in about 8K/year after expenses. We also have a fairly large mortgage (~290K) at 3.5% on our primary home. We're still working to try to juice up the taxable accounts to help stretch us until that golden age of 59.5. Because we will have a long time horizon in ER (we're 41 and 45), we want to understand the most tax-efficient way to get at our money. So my questions revolve around understanding that before pulling the plug. Would 72t work for us? Roth conversion ladder? I know I have a lot to learn in the next 3-4 years. We are also holding back on ER a little to see what happens with healthcare (we currently pay out of pocket for a Blue Cross grandfathered plan, but premiums are sure expensive!)
A little about me: I do contract work at Megacorp, although am in between gigs right now and may become a W2 employee soon if I can't find another contract. I love travel -- especially slow travel where you really get a feel of what it is like to live in a place. DH and I have done a few trips like that. I also love learning the "fun stuff" -- have taken about a dozen online MOOC courses on edx -- art history, philosophy, jazz appreciation, French -- all the "elective" stuff I wish I'd had the time to take back in college. I have a feeling that early retirement for me would include more of both travel and learning (in addition to the occasional day puttering around the house or surfing the web...which are also things I enjoy when the mood strikes).
Anyway, this forum has been a great research tool thus far and I'm looking forward to participating more in the discussions.