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Old 04-01-2016, 10:12 AM   #1
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Joining the 2016 class

I wanted to update the thread

Can I afford to early retire?

which I started almost two years ago but it looks like it is locked now. So I thought I would post some updates in a new thread. Feel very free to critic my plan. :-)

After getting a “slave-driver” manager this year, the situation at work is getting stressful. This pushed me into deciding to pull the trigger. The plan is to ER and relocate this summer and for the kids to attend the new school this fall.

I would be moving out from the SF bay area, selling off my primary residence and a rental property. I would be moving to the northern suburbs of Atlanta in Georgia (no more Dallas as in the original post) and closer to family.

Financial:
My 55/45 portfolio is currently 3.7m. The housing prices in my current area are at all time high. The sale of the rental is expected to add 200k (after commission and taxes) to the portfolio. The primary residence will fetch about 1.5m (after fees), of which 1/3 will be used to pay up the mortgage, 1/3 will be used to fully pay for a home in Georgia and the remaining 1/3 will be added to the portfolio. When the dust settles, I expect to have a portfolio of 4.4m.

Expenses:
I have been tracking my expenses on Mint for the past three years. Almost all the charges go onto the credit card, and in most months, this is less than $3k. Federal and state taxes in Georgia is budgeted to be around $10k a year. Housing (utilities + property taxes) would be around $8k. To that, I would add another $10k for vacation expenses and $15k for healthcare. The total budget a year would be around 36 + 10 + 8 + 10 + 15 = $79k. Let's call it $80k.

I am quite confident that the portfolio can generate $80k easily (1.8% withdrawal rate) in perpetuality. I am 47 and my spouse is 45 and we are both eligible for social security at the typical retirement age.

My wife ER'ed last year and enjoys the time she spends volunteering at the school. I might join her but I have a few personal projects which I plan to do when I ER.

Are there any recommendations or advice for me?

PS. College expenses is funded separately in 529 plans and not included in the above portfolio.
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Old 04-01-2016, 10:22 AM   #2
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Are there any recommendations or advice for me?
Enjoy being FIREd.
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Old 04-01-2016, 10:40 AM   #3
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Congratulations! Add your name to the Class of 2016 thread!
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Old 04-02-2016, 08:58 AM   #4
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Congrats! I moved from CA to GA myself several years ago. Depending where in the northern Atlanta suburbs, your budget looks quite reasonable. I would stay out of Fulton County though as that could increase your property taxes. Unfortunately I didn't do that as I wanted to be close to w*rk. (Plan to be in class or 2016 myself and downsize out of the county.)

Also, other expenses are lower than CA such as food and gas, so there is potential to lower your annual costs
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Old 04-02-2016, 05:25 PM   #5
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catotx, stick a fork in it, you're done.

Enjoy ER!
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Old 04-02-2016, 06:35 PM   #6
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Congrats! I moved from CA to GA myself several years ago. Depending where in the northern Atlanta suburbs, your budget looks quite reasonable. I would stay out of Fulton County though as that could increase your property taxes. Unfortunately I didn't do that as I wanted to be close to w*rk. (Plan to be in class or 2016 myself and downsize out of the county.)

Also, other expenses are lower than CA such as food and gas, so there is potential to lower your annual costs
Yep, I am avoiding Fulton county. I am going to Forsyth county since I won't have commute to worry about. Schools are as good as those in N Fulton county.
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Old 04-02-2016, 08:44 PM   #7
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Currently I am covered under the employer's health plan.

When I ER in May, I have the option of either using COBRA or purchasing insurance elsewhere.

My question: if I purchase insurance elsewhere, am I eligible to contribute to the HSA account for the partial year?
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Old 04-03-2016, 09:49 PM   #8
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Welcome to the class of 2016
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Old 04-05-2016, 10:45 AM   #9
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Congrats. Housing is definitely more affordable in GA. The cost of housing in the Bay Area & Southern Cal is insanely ridiculous.
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Old 04-05-2016, 12:02 PM   #10
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Originally Posted by catotx View Post
Currently I am covered under the employer's health plan.

When I ER in May, I have the option of either using COBRA or purchasing insurance elsewhere.

My question: if I purchase insurance elsewhere, am I eligible to contribute to the HSA account for the partial year?


Did you contribute to HSA with your existing employer plan? If so you reduce your maximum allowable HSA contribution and you need to make sure you sign up for an HSA eligible plan.

I had the same options as you and we chose to continue with Cobra for the first year because we had used all of our deductible and that would reset on the ACA plan. This year we are on the ACA plan and paying less (after subsidies) but with higher out of pocket max than company plan.

Congrats.
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Old 04-05-2016, 12:40 PM   #11
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Did you contribute to HSA with your existing employer plan? If so you reduce your maximum allowable HSA contribution and you need to make sure you sign up for an HSA eligible plan.

I had the same options as you and we chose to continue with Cobra for the first year because we had used all of our deductible and that would reset on the ACA plan. This year we are on the ACA plan and paying less (after subsidies) but with higher out of pocket max than company plan.

Congrats.
My existing plan is not a HSA plan. I am thinking to maybe take Cobra until Nov and then switch to HSA plan. I believe if I enroll into HSA plan before 12/1/16, I can make the full contribution to the HSA account this year (I need to maintain the HSA plan for a least a year).
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