Great forum -- I look forward to participating. I am a 52 year old professional guy. Wife does not work. One kid in college and the other in high school. We have money put aside for their college, in 529 plans.
I have worked really hard at my career -- too hard, if I am to be honest -- long hours, a lot of stress, and really no such thing as "time off." I gave up a lot.
For many years, I sort of enjoyed it. Or at least I enjoyed being successful at it -- the pay, status, etc. But these days I am not enjoying it. I'm tired and annoyed. And the profession in changing. So I am starting to plan my escape.
This would be really unusual at my company. Most people stay until their mid to late 60s, and many stay longer - some into their 80s. Retiring at 55 or so would be extremely unusual -- nearly unheard of. That is one reason I am grateful for this forum, because in my "real life" I know nearly no one who has retired early.
I have done a pretty good job of saving. I have a bit more than $10 million in taxable accounts and around $2.5 million in tax deferred. I have no debt and a house that is paid for and probably worth around $1.2mm When I retire, I will get around $1 million paid out over a few years, but beyond that no pension or retiree medical.
My overall portfolio allocation is currently around 70% equities and 30% fixed income. I am one year into a 5 year plan to incrementally reduce my exposure to equities -- the idea being to be at 40/60 or thereabout at the time of retirement. Depending on the amount I can contribute in the next few years, I may have to accept a fair amount of capital gain in order to execute this plan. I suppose I will have to either accept that a "price" for the re-balancing I want to achieve, or accept more risk than I think is optimal for me, in order to minimize tax liability. Any thoughts on that would be appreciated.
I am also considering at some point buying a fixed income annuity, to "purchase a pension." That may or may not be a smart financial move, but it will help deal with my anxiety about things going really badly. So there is a psychic benefit. I am thinking I might do this with some sort of ladder, since interest rates change, and also to mitigate the risk of counterparty (insurer) insolvency. So maybe five or so smaller annuities rather than one larger one. Do any of you have experience with fixed income annuities (either immediate or deferred), and if so what do you think of them as a tool? How should I think about the amount to commit to annuities. (I would do joint life -- I expect my wife to outlive me by a long time, based on genetics and other factors). I am not too worried about leaving a big inheritance to the kids. If I do, that is fine. But I made my own money and they can do so too (or can opt for quality of life and live cheaper).
I still have a lot to think about -- what I want to do in retirement, how much I will want or need to spend, how my investment strategy should change as I approach and move into an early retirement, etc. But I have already gone on too long for an introductory post, so I will stop here.
I have worked really hard at my career -- too hard, if I am to be honest -- long hours, a lot of stress, and really no such thing as "time off." I gave up a lot.
For many years, I sort of enjoyed it. Or at least I enjoyed being successful at it -- the pay, status, etc. But these days I am not enjoying it. I'm tired and annoyed. And the profession in changing. So I am starting to plan my escape.
This would be really unusual at my company. Most people stay until their mid to late 60s, and many stay longer - some into their 80s. Retiring at 55 or so would be extremely unusual -- nearly unheard of. That is one reason I am grateful for this forum, because in my "real life" I know nearly no one who has retired early.
I have done a pretty good job of saving. I have a bit more than $10 million in taxable accounts and around $2.5 million in tax deferred. I have no debt and a house that is paid for and probably worth around $1.2mm When I retire, I will get around $1 million paid out over a few years, but beyond that no pension or retiree medical.
My overall portfolio allocation is currently around 70% equities and 30% fixed income. I am one year into a 5 year plan to incrementally reduce my exposure to equities -- the idea being to be at 40/60 or thereabout at the time of retirement. Depending on the amount I can contribute in the next few years, I may have to accept a fair amount of capital gain in order to execute this plan. I suppose I will have to either accept that a "price" for the re-balancing I want to achieve, or accept more risk than I think is optimal for me, in order to minimize tax liability. Any thoughts on that would be appreciated.
I am also considering at some point buying a fixed income annuity, to "purchase a pension." That may or may not be a smart financial move, but it will help deal with my anxiety about things going really badly. So there is a psychic benefit. I am thinking I might do this with some sort of ladder, since interest rates change, and also to mitigate the risk of counterparty (insurer) insolvency. So maybe five or so smaller annuities rather than one larger one. Do any of you have experience with fixed income annuities (either immediate or deferred), and if so what do you think of them as a tool? How should I think about the amount to commit to annuities. (I would do joint life -- I expect my wife to outlive me by a long time, based on genetics and other factors). I am not too worried about leaving a big inheritance to the kids. If I do, that is fine. But I made my own money and they can do so too (or can opt for quality of life and live cheaper).
I still have a lot to think about -- what I want to do in retirement, how much I will want or need to spend, how my investment strategy should change as I approach and move into an early retirement, etc. But I have already gone on too long for an introductory post, so I will stop here.
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