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Old 04-17-2017, 01:50 PM   #1
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New to the forum, but coming here feels like home.

Howdy,

I stumbled upon the site recently. I can't remember exactly what I was searching for at the time, but I found the "Share your Milestones" thread, read all 72 pages, and I was hooked.

Finally I have an outlet to discuss retirement savings with like-minded folks and seek/offer advice.

My background:
Retired O-5 (Navy) w/23 years active service, 2.5 years into my second career. I am 47, DW 46, DD1 17, DD2 15.

We have saved ~$625K (cash, Roth IRA, taxable mutual fund accounts, TSP, and 401K).

By my projections, we are on track to hit $1M in 2021 (YOA), with the mortgage paid off in 2029 (59 YOA). I'm hoping to hit both of these milestones a bit sooner as my goal from here on out is to put all future pay raises towards savings and once my DD's finish private HS that will free up a bit more. For projections, I used the lifetime rate of growth minus 1% (to be conservative?). I don't project any growth in my cash holdings.

Although I am well behind many here, I think my saving grace is my military retirement which is ~$60K (gross/year) + COLA. Factoring that, I think I am OK'ish.

This forum has already helped me in one big way. We had been putting more towards the mortgage principal IOT pay it off sooner, but at a 3.125% interest rate, we've decided our money is better "spent" on increasing contributions towards my wife's 401K. Reading various threads on this forum has helped me overcome my psychological desire to pay off the mortgage at the expense of better options.

Looking forward to learning much more!
-AginMS
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Old 04-17-2017, 01:57 PM   #2
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Welcome, AginMS and congrats on your accomplishments (yes, you probably ARE behind some of the folks here, but you also are AHEAD of others. Especially with your well-earned pension (thanks for your service!).
At the end of the day, it's less about the stash, and more about the burn rate. If you have a good grip on that, retirement planning becomes much easier.
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Old 04-17-2017, 02:04 PM   #3
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Originally Posted by AginMS View Post
My background:
Retired O-5 (Navy) w/23 years active service, 2.5 years into my second career. I am 47, DW 46, DD1 17, DD2 15.
Welcome! I will be joining that first part in about 2.5 years, so always good to have more brains to pick around here. I'll punch at 20, and DD1 is 7 months old, so a little bit of a different path.

As euro mentioned, that O5 pension is a nearly $2M head start on a whole lot of other people, so the additional $625K is probably ahead of most of your true peers. I've not personally met another retired officer (O4, O5, or O6) who could match that at retirement, but admittedly the number of folks whose numbers I know are few.

Not sure what the future brings, but a bridge career is the most likely option for me, considering I'd like to see if I can find something I truly enjoy that allows more time with the young family.


Again, welcome! Tons of insight here. I've learned a lot in four years. As with all things, better late than never!
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Old 04-17-2017, 02:51 PM   #4
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Welcome! I will be joining that first part in about 2.5 years, so always good to have more brains to pick around here. I'll punch at 20, and DD1 is 7 months old, so a little bit of a different path.

As euro mentioned, that O5 pension is a nearly $2M head start on a whole lot of other people, so the additional $625K is probably ahead of most of your true peers. I've not personally met another retired officer (O4, O5, or O6) who could match that at retirement, but admittedly the number of folks whose numbers I know are few.

Not sure what the future brings, but a bridge career is the most likely option for me, considering I'd like to see if I can find something I truly enjoy that allows more time with the young family.


Again, welcome! Tons of insight here. I've learned a lot in four years. As with all things, better late than never!


Nash,

Thanks for the 'Welcome Aboard'.

Not sure if you have given it much thought yet, but my biggest shock after working a full year in my second career was Federal taxes. While on A/D, DW and my combined salaries were around $185K, but much of that was in non-taxed allowances (BAH, BAS).

Once retired, I put all withholding exemptions at 0, but still wound up owing an additional whopping $14K because while all three incomes (retired pay, my salary, DW salary) were all in the 15% marginal tax rate, added up we were into the 28% marginal rate. Now I have $1,200/mo add'l from retired pay going to Fed taxes and this year I got back $3,500 in tax refunds. This is from overpaying the $1,200/mo, but also increasing my civilian pre-tax TSP contribution.
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Old 04-17-2017, 03:07 PM   #5
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Welcome aboard, and thank you for your service!! Your well earned and deserving pension, plus your savings, puts you on par with many here. I assume there will be some level of SS, as well?

As euro said, your burn rate is what really matters when you look at your income and investments. You look well on your way to FIRE.
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Old 04-17-2017, 04:06 PM   #6
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Nash,

Thanks for the 'Welcome Aboard'.

Not sure if you have given it much thought yet, but my biggest shock after working a full year in my second career was Federal taxes. While on A/D, DW and my combined salaries were around $185K, but much of that was in non-taxed allowances (BAH, BAS).

Once retired, I put all withholding exemptions at 0, but still wound up owing an additional whopping $14K because while all three incomes (retired pay, my salary, DW salary) were all in the 15% marginal tax rate, added up we were into the 28% marginal rate. Now I have $1,200/mo add'l from retired pay going to Fed taxes and this year I got back $3,500 in tax refunds. This is from overpaying the $1,200/mo, but also increasing my civilian pre-tax TSP contribution.
Thanks for the heads up on that. I've been looking at those numbers and how they will impact us in the future. If we still live in CA, it's going to be a big hit on my income with the 8.5% here as well, which I'm currently not obligated to pay. DW pays it since she was employed here before we married, so I don't claim the SSRA for her. But, all that money being taxed will certainly be a drain.

We owed several thousand in federal taxes this year because much of her pay came from disability (maternity leave) and we're also claiming considerable dividend income now that we weren't just a few years ago. The tax man always cometh...
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Old 04-17-2017, 04:51 PM   #7
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Old 04-17-2017, 05:03 PM   #8
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Welcome here AginMS,


FWIW we generally do not quote our dollar amounts when discussing personal financial matters. Keeping your cards close to the vest and using percentages is a better way to get your point across but not reveal your true numbers. For example you mat say "my pension is 80% of our fixed monthly costs" rather than $60K.
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Old 04-17-2017, 05:10 PM   #9
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Welcome here AginMS,


FWIW we generally do not quote our dollar amounts when discussing personal financial matters. Keeping your cards close to the vest and using percentages is a better way to get your point across but not reveal your true numbers. For example you mat say "my pension is 80% of our fixed monthly costs" rather than $60K.
Forgive my ignorance, but since most folks here are anonymous, what reasons are there for not divulging actual dollare amounts when asking for advice or opinions?
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Old 04-17-2017, 05:21 PM   #10
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Old 04-17-2017, 05:40 PM   #11
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Welcome here AginMS,


FWIW we generally do not quote our dollar amounts when discussing personal financial matters. Keeping your cards close to the vest and using percentages is a better way to get your point across but not reveal your true numbers. For example you mat say "my pension is 80% of our fixed monthly costs" rather than $60K.
Some do. Some don't. I prefer the percentage approach myself, but it's a decision we each have to make. Speaking generally as a moderator, and not specifically for myself, I think using percentages is also a way to discuss important concepts and issues while avoiding the direct comparisons among members that could lead to friction.
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Old 04-17-2017, 10:01 PM   #12
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Welcome here AginMS,


FWIW we generally do not quote our dollar amounts when discussing personal financial matters. Keeping your cards close to the vest and using percentages is a better way to get your point across but not reveal your true numbers. For example you mat say "my pension is 80% of our fixed monthly costs" rather than $60K.


I understand that reasoning Mickeyd. My point of reference was the 72 page "Share your Milestones" post I had recently read where the vast majority had posted actual dollar savings milestones.

Although I prefer actual amounts, I can see a benefit to using actual dollar values or percentages based on the context of the post.

BTW, there isn't anything particularly private about military pay or retirement. Military (and civil service) pay charts are easily found on OPM's website and anyone can easily calculate a military member's pay or retirement if you know their rank and number of years of service.
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Old 04-17-2017, 10:52 PM   #13
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We are not really anonymous.
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Old 04-18-2017, 07:30 AM   #14
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We are not really anonymous.
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Old 04-18-2017, 07:39 AM   #15
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We are not really anonymous.
We are not really unanimous.
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Old 04-18-2017, 01:57 PM   #16
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After enough interactions, participants form a pretty clear opinion of of an individual (except for political views). But I don't think they are into ID theft. It is the hidden scanners that you have to beware.

But I think you will have a good time here in spite of that.
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Old 04-18-2017, 03:45 PM   #17
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We are not really anonymous.
We are not really unanimous.
No, we REALLY are not unanimous!
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Old 04-18-2017, 03:46 PM   #18
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No, we REALLY are not unanimous!
I think we can ALL agree on that......oh, wait...
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Old 04-18-2017, 03:50 PM   #19
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After enough interactions, participants form a pretty clear opinion of of an individual (except for political views). But I don't think they are into ID theft. It is the hidden scanners that you have to beware.

But I think you will have a good time here in spite of that.
I posted on several forums and sometime and I picked a joke of a screen name. Interesting, I've heard from my brother who's heard from his wife's cousin about my financial status. I laughed about it knew it was that forum. Of course I changed my screen name immediately after it. Maybe I gave too much information away.
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Old 04-19-2017, 02:13 AM   #20
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AginMS-

Welcome, enjoyed your post. This is a great forum. About your screen name: did you recently move back to MS? Or it means you are an Ag living in MS?

Curious minds...
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