Retired military need some advice

[mcdevin1970]

Hello everyone glad I found this site. My name is Devin and I retired from the Army (21 years) on 7/31/2011. I currently still work and I am looking for ER in 2018. I have two sons that I am waiting to finish college before I start thinking about my new life as a true retiree.

I currently make $3000 a month after taxes in pension and military disability. In 4-5 years I will be selling my current home and heading to Florida (Tampa area) as that is where I would like to retire. Once I sell my home, I would anticipate having about $100,000 in savings. I also have ~ $40,000 in a Roth IRA. My plan, once my kids are gone is to buy a home in Florida and take on another mortgage. Being empty nesters, I anticipate having far less expenses...I currently pay for their cell phones, food, car insurance, entertainment, college etc. We have no credit cards or car payments. My health insurance is $120 a month for my whole family.

So I figure if it's just my wife and I, we could live pretty well even if I had to pay a $1000-$1200 mortgage . I would also at least work part time and generate maybe an additional $1500 for a total of $4500 a month. Is this a realistic expectation? I mean I currently make $40,000 a year plus pension and disability and wife makes about $13,000 a year so we are living on $85-90,000 a year. I guess the thought of living off of so little is a bit scary. But, I am tired of working like a dog after 21 years of military service. Life is short and I want to enjoy my time with my wife. Can any of you make recommendations or suggestions as to what I could do to prepare myself for when this day comes. How far fetched do you think my plan is?

Thanks in advance for any advice that you can provide!

Devin

 

[HawkeyeNFO]

I currently make $40,000 a year plus pension and disability and wife makes about $13,000 a year so we are living on $85-90,000 a year.

Congrats on retiring the first time, stick around here and learn from others so you can soon retire again, this time without needing to go back to work!

The question I have for you is "how much do you save every month?" Does living on 85-90k / year include savings? Is that your income or your expenses? More details will get you better advice at this board.

 

[mcdevin1970]

Thanks for the reply Hawk! I save $500 a month. $300 in to roth IRA and $200 into savings. The $85 - $90,000 is our income. Our expenses are probably $3000 a month right now with my sons still living at home but I anticipate both of them being out of the house by 2018 and our expenses being reduced to a mortgage and other basic expenses. I just got done paying $5000 for braces and getting ready to do it again with my youngest son. I bought a new car for my oldest son will be paid off 2016 and my youngest son will have a new car next year that will be paid off 2018. So these kids are killing me as far as expenses! I also pay for my oldest son's college, cell phone etc. So I see big changes in our monthly expenses once these guys are done with college.

Also, I am 42 years old I think I failed to mention that in my original post. Hopefully that clarified some things for you. I look forward to further replies!

 

[braumeister]

You're saving less than 7% of your income, but buying new cars. Sounds like big trouble to me, even without an ER goal.

So, recommendation number one is to get a seriously good handle on your expenses and create a budget you can follow.

 

[samclem]

I agree that the budget is step 1. That just means tracking your actual expenses so you know where the money is going. That's the only way to have a firm idea as to whether you'll have enough income. A move to FL and the other life changes (kids moving out, etc) will throw some of these numbers into doubt, so you'll have to make some informed estimates about how your expenses will change, but first you need to establish your present spending patterns. While doing that, you'll need to make some assumptions about how you and your wife will spend your time in these coming years--and what that will cost. Nobody can tell you if you've got enough until you know how much you'll be spending.

About working in the future: Just because you'll be earning less doesn't mean the job won't be as much/more aggravation than your present job. Many low-paying jobs are not a lot of fun. On the other hand, if you'll be getting the same hourly rate as you earn now and doing something that is tolerable (but just working fewer hours), that might be better. Also, give some consideration to diligently socking away more money right now while you have higher income, it might give you more flexibility down the road. And if you are saving more money it means you are finding ways to live on less money each month, which is probably going to be the long-term key to making this all work.