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Old 01-29-2016, 11:51 AM   #21
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I believe that 3% of 2 million is $60K a year. Average family income in the US is about $52K and most of them are paying a mortgage or rent.

And let's not forget SS and Medicare taxes...


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Old 01-29-2016, 11:52 AM   #22
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I don't meet your exact criteria - but close enough.

Family of 4. Portfolio significantly less than $1.5M, but over $1M. Paid for house that has a rental property.
Thanks Rodi. We have thought long and hard about a rental scenario for several years. But we never jumped in. Yet. Seems as though a ton of people on this forum have rentals and do quite well, yourself included. Some form of passive income would REALLY be nice in our scenario. We'll have absolutely nothing coming in until SS and that's, well, a bit scary. We have lingering doubts whether we're equipped to do the rental scene. I'm handy but until now I never seemed to have enough time to go there. And even now, I'm not sure it's what I want to be doing. I've talked to a couple property mgmt. cos and wasn't overly impressed with the 'deal'. But going it alone is still very much on our radar.

Thanks for sharing!
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Old 01-29-2016, 12:20 PM   #23
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Thanks Rodi. We have thought long and hard about a rental scenario for several years. But we never jumped in. Yet. Seems as though a ton of people on this forum have rentals and do quite well, yourself included. Some form of passive income would REALLY be nice in our scenario. We'll have absolutely nothing coming in until SS and that's, well, a bit scary. We have lingering doubts whether we're equipped to do the rental scene. I'm handy but until now I never seemed to have enough time to go there. And even now, I'm not sure it's what I want to be doing. I've talked to a couple property mgmt. cos and wasn't overly impressed with the 'deal'. But going it alone is still very much on our radar.

Thanks for sharing!
We were accidental landlords... Built a detached 1 bedroom granny flat to care for my in-laws. When they no longer needed it rented it to various extended family for a few years for reduced rent. When they no longer needed it we put it on the open market and get a nice steady income. It's very convenient having it literally in our backyard... so DH just walks down the path to do any repairs. It helps that we've got dream tenants.
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Old 01-29-2016, 05:36 PM   #24
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We were accidental landlords... Built a detached 1 bedroom granny flat to care for my in-laws. When they no longer needed it rented it to various extended family for a few years for reduced rent. When they no longer needed it we put it on the open market and get a nice steady income. It's very convenient having it literally in our backyard... so DH just walks down the path to do any repairs. It helps that we've got dream tenants.
I bought a two family home 18 years ago and now that the mortgage is paid off the $1200/month rent for the downstairs apartment is very useful. I also have a great tenant.
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Old 01-29-2016, 05:45 PM   #25
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Thanks NW. I like a warm/fuzzy feeling....

When I run SS#'s I typically reduce the projected payout in each scenario by 30 to 40%. Sometimes I run the numbers with zero SS. Ouch.

When you were in my shoes did you go full bore on SS for your analysis or reduce a bit?
I run FIRECalc with SS at full face value. And FIRECalc tells me I can spend about 30% more than what I have been doing. And in recent years, I had many non-recurrent expenses (daughter's wedding, home improvement/repair on 2 homes, $10K health deductible each year for 3 years straight).

So, I should have plenty of safety margin. Needless to say, it makes me feel warm all over.

All I need now is to live for another 30 years to match that FIRECalc run length, and I have doubts that I will live that long.
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Old 01-29-2016, 06:33 PM   #26
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I've attempted to dig through old threads here to answer this question but haven't uncovered one yet.

I realize that expenses are what really drive feasibility and that every circumstance is different.....but I'm curious to know if there are a decent number of folks on this forum that have successfully retired with $2M in assets or less, no defined pension, no company subsidized health insurance, when they were 50 years of age or younger? I may as well throw a spouse and a kid into the mix, as I have both

Lastly, if you meet the criteria above and its been more than a year or two since you pulled the plug...how would your access your situation now? Happy as a clam, a tad nervous, wish you'd of hung on longer?

I'd love to hear from you!

Thanks-Syd
I don't quite meet your criteria because I ER'd at 52 rather than 50 but other than that yeah. It's now 13 years latter and I'm 65, my wife is 67 and I have a disabled son (veteran) living with us. All I can say is it has been great.

We moved from a high cost location (Bay Area California) to a lower cost area (SW Oregon) no regrets. Took SS at 62 which a lot of folks @ this forum will advise against but it felt right and it was the right move for us.

Conservative 50/50 equities/bonds allocation mostly in lower cost Vanguard Funds except for a few dumb legacy fund investments from the long ago time when I paid attention to financial media. Our expenses fit right into that 60 to 80K band that is purported to be a comfortable middle class happiness plateau. This ER business works for us, not nervous and if I had hung on longer I'd probably be dead for a while now from the stress from my old job.
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Old 01-30-2016, 09:08 AM   #27
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I don't quite meet your criteria because I ER'd at 52 rather than 50 but other than that yeah. It's now 13 years latter and I'm 65, my wife is 67 and I have a disabled son (veteran) living with us. All I can say is it has been great.

We moved from a high cost location (Bay Area California) to a lower cost area (SW Oregon) no regrets. Took SS at 62 which a lot of folks @ this forum will advise against but it felt right and it was the right move for us.

Conservative 50/50 equities/bonds allocation mostly in lower cost Vanguard Funds except for a few dumb legacy fund investments from the long ago time when I paid attention to financial media. Our expenses fit right into that 60 to 80K band that is purported to be a comfortable middle class happiness plateau. This ER business works for us, not nervous and if I had hung on longer I'd probably be dead for a while now from the stress from my old job.
Ejman-thanks for sharing your thoughts. Your situation sounds nearly identical to mine, right down to asset alloc. Could I clarify if you have a defined pension and retiree healthcare? We have comfortably lived while working on $60 to $70K per year for the last 15 years or so but that included company paid health ins. Now we will be purchasing health insurance at a minimum of $11K per year. And we have only a very small pension to look forward to at 65 ($6,200/year)

The area you live is beautiful, by the way. We were there about 2 years ago
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Old 01-30-2016, 09:26 AM   #28
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Ejman-thanks for sharing your thoughts. Your situation sounds nearly identical to mine, right down to asset alloc. Could I clarify if you have a defined pension and retiree healthcare? We have comfortably lived while working on $60 to $70K per year for the last 15 years or so but that included company paid health ins. Now we will be purchasing health insurance at a minimum of $11K per year. And we have only a very small pension to look forward to at 65 ($6,200/year)

The area you live is beautiful, by the way. We were there about 2 years ago
No retiree healthcare. We currently have Medicare but prior to that we had a Bronze plan under Obamacare and prior to that we had a hell of a time finding health insurance due to pre existing conditions. What we finally ended up having to do was to create a hobby business and then find a group plan for two! which had lousy coverage and very large premiums. Fortunately those charades are no longer necessary. Thank God for Obamacare. I do have a tiny pension of less than $400 a month that started last year when I turned 65. It sure does sound like there are a lot of similarities in our situation.

Don't forget on the budget side that several categories of expenses generally do go down after ER, i.e. contributions for SS, Medicare, 401K etc all disappear. Also commuting and other work related expenses ( that lunch and coffee at work may be $4 to 5k a year for example, a lot cheaper at home).

Yes, we have been very happy in this area, about 7 acres in the forest with plenty of room for our horses and other critters.
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Old 01-30-2016, 10:24 AM   #29
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More similar by the minute. Though we don't have horses now (only 1 acre), we raised horses as a family growing up. A hobby for the folks, not a business. Bred several, often had a foal running around. Lots of trail riding and some showing too. Very, very happy memories
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Curious??
Old 01-30-2016, 10:35 AM   #30
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Curious??

There are lots that fit the criteria. Growing by the day !!!

At one time I had suggested a forum location for those fitting the criteria "below 50/FIREd" but mods did not go for it.

I think the profile that you describe is fairly common for early retirees in their 40s.

The pension as was common has disappeared for most in this age bracket.
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Old 01-30-2016, 10:57 AM   #31
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Yes Papa, agree. I have a few friends my age (just a hair under 50) with a nice pension to supplement their savings. Most don't. But my concern is there seems to be no end to people with nice pensions on this forum. Yes, I'm jealous but happy for them at the same time. Clearly they can afford to maybe worry a bit less about their nest egg outside that pension. I can't seem to stop this nagging feeling that I'm going to be swimming against a strong current. If I could just stumble upon another million or so in the next week I'd be fine. I'm not asking for anything unreasonable am I?
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Old 01-30-2016, 10:59 AM   #32
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If you are being laid off, enjoy your time off, you might find work again. But I think you have a decent amount to retire.


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Old 01-30-2016, 09:27 PM   #33
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Curious??

I think you will be surprised at how well you will actually be able to live. Always easy to hope for another million or a market that never corrects but hope isn't a plan.

Hypothetical: If you had to stop working today at a hypothetical age of 48. Assume full retirement age for you is 68 to access SS.

You have 2 million. Put it 90/10 equities/cash. Earn 2.75 percent dividend yield gross before taxes. Pay 15 percent dividend tax. Have approx 48K/y or 4K/mth without touching principle. That goes on for 20 years. Dividend yields grow just enough to keep pace with inflation. Market returns just enough. Excluding your dividends to keep pace with inflation. Cash will get you through most downturns if a dividend cut happens ... Hell thats 4 years of cash assuming dividends drop to zero, which they won't.

Now keep in mind average USA household income is 52k per year and most of those people cover their rent or a mortgage with that, save a little for retirement, pay federal and state income taxes, may have to pay health care too.

You on the other hand have a paid for home, have access to obamacare (and maybe subsidies) , you are in a 15 percent dividend tax bracket, you can choose to live anywhere less expensive and not depending on where your job is, don't need to tuck away anything for retirement any more etc

You can even do it without ever touching your 2M principle !!

20 years later you will get a bump in pay due to social security. Could come as early as 14 years from now at age 62.

And you have your $2M Nut...which has grown ... To something equivalent in future years to that 2m today...

Pensions - they don't really exist for our generation.

You could always take your 2M and buy an annuity. I wouldn't. And I bet those friends that have a pension don't have the size of Nut that you have. Bet theirs is not even close.
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