Join Early Retirement Today
Reply
 
Thread Tools Search this Thread Display Modes
Old 03-09-2013, 11:53 AM   #21
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
youbet's Avatar
 
Join Date: Mar 2005
Location: Chicago
Posts: 9,965
Quote:
Originally Posted by Shanky View Post
If I retire now, it would be about 25% of current income.
It's too bad you threw the "25% of current income" into the question. Determing FIRE budgets based on a percentage of pre-retirement income is a hot button here on the
FIRE Forum and the answers you're getting are mostly focused on that percentage rather than on what you're really asking.
Quote:
We would have to leave California for a lower cost state and tone down the life style. Kids are launched. Our Fire income would be comfortable by many standards, but not compared to our current lifestyle costs. Anyone know of a successful downshift by that much?
I think you're talking about a very personal situation. You gave no detail on how much you're enjoying the high tier Calif lifestyle, whether you have friends and/or relatives there and would really miss them or whether there are expensive activities you'd really miss if you gave them up.

The fact that you've asked the question hints that you do have some concern about moving to a less expensive location and giving up life amenities you currently enjoy. As to whether cutting off access to your current location or those pleasurable amenities would be offset by the pleasure of throwing in the towel on your not-so-enjoyable career, you'll have to decide that.

You might try listing some of the important, relevant issues and think about them a bit. For example:

1. If you currently live in a deluxe home and have well educated, sophisticated neighbors, would it be OK to be in a much more modest home and perhaps have neighbors (and possibly new friends) who are involved in or retired from more plebian circumstances? That is, the guy next door is a retired postal worker or truck driver instead of a retired orthopedic surgeon or college president...

2. If you enjoy any current amenity such as membership at a private golf club, would it bug you to be out on a public course with the rest of the hackers?

3. Do you do anything expensive, such as travel, gourmet dining or live entertainment on a regular basis that you'd miss?

4. It's possible that in your current career you don't have time to do a lot of things for yourself and can easily afford to pay others to do things for you. Will you be comfortable being much more self-sufficient over a wide range of activities? Taking care of your own house and cars, doing your own investing and taxes, whatever, etc.?

This list could go on forever and I only mean these notions to be examples. You have to think about the substantial items in your current life that will permanently go away and decide if the loss will be adequately balanced by not having to work at your current job.

Again, because you asked the question, I'm assuming you have some concerns, that you think there will be things you'd miss and that your job isn't so bad that it's a slam-dunk that leaving is for you.

As far as knowing anyone who has done something similar, I'm afraid I don't. We do have friends who retired from highly compensated jobs (a corp controller and a very successful bond trader), sold their downtown Chicago high rise condo and moved to a hobby farm in Wisconsin. They seem very happy and can't believe how much less they're spending. But, and it's a big "but," they could afford to come back to Chicago, purchase another high rise condo and resume their swanky, urban lifestyle if they wished due to a huge FIRE portfolio. You sound as though your move would be a one way decision which is a very different scenario.

Good luck!
__________________

__________________
"I wasn't born blue blood. I was born blue-collar." John Wort Hannam
youbet is offline   Reply With Quote
Join the #1 Early Retirement and Financial Independence Forum Today - It's Totally Free!

Are you planning to be financially independent as early as possible so you can live life on your own terms? Discuss successful investing strategies, asset allocation models, tax strategies and other related topics in our online forum community. Our members range from young folks just starting their journey to financial independence, military retirees and even multimillionaires. No matter where you fit in you'll find that Early-Retirement.org is a great community to join. Best of all it's totally FREE!

You are currently viewing our boards as a guest so you have limited access to our community. Please take the time to register and you will gain a lot of great new features including; the ability to participate in discussions, network with our members, see fewer ads, upload photographs, create a retirement blog, send private messages and so much, much more!

Old 03-09-2013, 12:02 PM   #22
Thinks s/he gets paid by the post
 
Join Date: Nov 2009
Posts: 3,870
Quote:
Originally Posted by Independent View Post
So we had no lifestyle change.
One requirement for me when planning my ER budget was that I would have no lifestyle change. I could maintain my volunteer work, even expand it a little. (It is not a costly activity). Same for my hobbies.

I could go out to eat now and then with my ladyfriend, just as I have been doing all along, without breaking my budget. If there is something I need to buy, I buy it. I often go months without using my credit or debit card and that has not changed since I ERed.

Related to the "no lifestyle change" requirement is one in which I build into my budget a cushion or surplus I can use to cover any small, unforeseen expenses. I bought a new PC last year, I had it covered. I was a little spendy with cash one month, I had it covered. I know these things won't repeat every month.

And even for some regular expenses which have risen in the last few years, I have it covered. The cushion has shrunk a little bit but it still averages about $400 a month.
__________________

__________________
Retired in late 2008 at age 45. Cashed in company stock, bought a lot of shares in a big bond fund and am living nicely off its dividends. IRA, SS, and a pension await me at age 60 and later. No kids, no debts.

"I want my money working for me instead of me working for my money!"
scrabbler1 is online now   Reply With Quote
Old 03-09-2013, 12:04 PM   #23
Thinks s/he gets paid by the post
Katsmeow's Avatar
 
Join Date: Jul 2009
Posts: 3,399
Our final retirement budget will be about 25% of our right before ending full-time employment/retirement income. Currently DH is 2 1/2 years retired and I've been part-time for that time. So I have a lot of comments on this.

While Midpack's idea of living on the retirement budget is a good one for many people it was not one we could do. First, we had some major expenses that weren't going to continue during retirement. Also DH and I were perhaps somewhat unusual in that we married when I was in my late 30s so we started with kids late. When DH was 62 and ready to retire we still had 3 adolescents at home. I know people talk about waiting until kids are gone and completed all schooling before retiring but in our case that would have meant DH working until almost 70.

So he retired knowing the expenses would be high for the first few years with kids and expecting them to go down over the years. Currently we have 1 kid out on his own and off our expenses entirely. Another with a couple of more years of college left so the end of expenses is near and another soon to graduate high school. I have continued to work part-time to bridge the gap.

So we couldn't practically live on the final retirement expenses while we still have kids here. We worked more on projections.

Our expenses for this year will be about 40% of our pre-retirement income and that includes paying for tuition for one child in college and expenses for our child still in high school. Bear in mind that we had relatively high income before DH retired and I went part time. In fact, in the 5 years before he retired his income in particular had gone up considerably over what it had been for most of our marriage. The point is that 25% of our last pre-retirement income is till a significant amount of money.

Based upon our current expenses I don't see a problem with us, say, 5 years from now, living on 25% of our pre-retirement income.

We have to some extent adjusted the lifestyle. We bought a smaller house (it is still a very nice house -- just that the old house was 4500 SF with a guest house, pool, 2 double garages and the new house is about 2900 SF). We felt that we wanted to be retired sooner rather than have as high a lifestyle as we had before.
__________________
Katsmeow is offline   Reply With Quote
Old 03-09-2013, 12:10 PM   #24
Thinks s/he gets paid by the post
 
Join Date: Feb 2011
Posts: 1,629
Gotta agree with martyb. Success of ER on 25% of w#rking income depends on individual circumstances, inc "sacrifices" one is willing to make. Is it sacrificing the country club membership, McMansion, world-hopping vacations, 5-star restaurants, Cadillacs in the driveway, etc., or sacrificing the basics of food, shelter, & health care?
__________________
ERhoosier is offline   Reply With Quote
Old 03-09-2013, 12:17 PM   #25
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
 
Join Date: Feb 2013
Posts: 5,327
Our final, baseline retirement expenses for just the two of us will be under 20% of our gross, peak earning income years. But we have inexpensive tastes, cheap hobbies and are happy with the whole simple living / Your Money or Your Life kind of lifestyle.

We live a bit like the Mr. Money Mustache blog but with a bigger budget -
http://www.mrmoneymustache.com/2012/...2000-per-year/
__________________
daylatedollarshort is online now   Reply With Quote
Old 03-09-2013, 12:48 PM   #26
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
haha's Avatar
 
Join Date: Apr 2003
Location: Hooverville
Posts: 22,386
Leaving California may not be as money saving as it appears. Where you live can strongly affect the way your money is used. I moved from an area near central LA to the beach, and my expenses dropped considerably because I no longer wanted to get the hell away every weekend. The air was better, and why go anywhere if you live 2 blocks from the Pacific Ocean? Maybe occcasionally head out to the mountains.

To a somewhat lesser extent, I feel the same here in Seattle. Some costs are a bit higher here than the national average, like housing, and since wages are high, getting anything done is apt to cost more. But again, as long as escaping the weather is not a problem for a person, there is no driving need to escape on vacations.

If someone lives in a very attractive place, it can be hard to move away, and I for one would not make any decisions that seemed to make a move to a cheaper place necessary. Unless of course I were about to go crazy on my job and I had thoroughly explored ways of improving my work satisfaction and had at least tried some of them.

Ha
__________________
"As a general rule, the more dangerous or inappropriate a conversation, the more interesting it is."-Scott Adams
haha is offline   Reply With Quote
Old 03-09-2013, 01:43 PM   #27
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
Midpack's Avatar
 
Join Date: Jan 2008
Location: Chicagoland
Posts: 11,977
Quote:
Originally Posted by GolfingDuo View Post
I don't want anyone to think that I am disagreeing with the idea. I just think it is impractical as a physical tool to do that. On the flip side all the planning and calculating in the world will not account for everything either and will not be always 100% or 0% or anything in between.
Of course it won't be practical for everyone, but that does not make it categorically "impractical as a tool" in preparing for a retirement spending budget. I also opened my post saying "there is no universal answer."

Many here and elsewhere have indeed reduced their spending to projected retirement levels, or as close as possible, to test the waters before pulling the plug. I didn't originate the idea, it's recommended in many published retirement books/websites as well. We most certainly did it. Although there were some minor differences in several expense accounts, they were all easy to anticipate in terms of +/- change if not in exact dollars. Having finished my second year retired, I can confirm that our planning method was sound for us - our spending has been well within 5% of expected.

And it beats picking a % out of thin air, or even someone else's actual %.

If you have another suggestion that would help the OP, I am sure it would be welcome.

Reminds me of being back at work, 'I don't have any better ideas of my own, but I'd like to criticize yours anyway...'
__________________
No one agrees with other people's opinions; they merely agree with their own opinions -- expressed by somebody else. Sydney Tremayne
Retired Jun 2011 at age 57

Target AA: 60% equity funds / 35% bond funds / 5% cash
Target WR: Approx 2.5% Approx 20% SI (secure income, SS only)
Midpack is offline   Reply With Quote
Old 03-09-2013, 02:03 PM   #28
Thinks s/he gets paid by the post
Live And Learn's Avatar
 
Join Date: Feb 2012
Location: Tampa Bay Area
Posts: 1,689
Quote:
Originally Posted by Midpack View Post
I retired on about 25% of income (income varied considerably annually with bonus), but we always lived well below our means. There is no universal answer of course.

Goes almost without saying that you have to track what you're actually spending now for the plan to have any credibility. Not to insult anyone, but people post here who are considering retiring and they've never tracked their spending, much less vs a budget.



IMHO everyone should spend at least one year living at their projected retirement annual spending level before retiring to make sure it can be done. I wouldn't trust myself to what I think I might do on paper, might work, might not (then what?). We lived at the reduced spending level for 3 years before I retired. And our annual spending target was built on:
  • what we actually spent in each of the 3 years before [edit: factor in expected changes in clothing, travel, etc. - ours were minor and predictable for the most part]
  • plus an "accrual" amount for major expenses that don't occur regularly (cars, roofs, major home repairs/replacements/remodels)
  • plus an amount for health care insurance before/after Medicare.
Add up those three and if it's 25% of current income, I'm not sure what others say matters...best of luck!
+1 !

I will be about about 30% of my curreng gross income once I retire. Some of that saves comes from expense reduction (approx 10% of current income from downsizing home therefore reduced insurance, taxes and maintenace costs), tax savings (approx 20% of current income), 401k contributions (10% of current income) and elimination of all other savings contributions (30% of current income).

Like Midpack: I've tracked expenses for 5 years and know exactly what I spend, and my budget includes "accruals for major expenses". My actual retirement depends upon HI which I'll know more on October, so I'll pull the plug if it turns out as I hope.

Therefore - I'll be at 30% of current income but I'll have no reduction in expenses (in fact, a couple of items are budgeted higher than todays spending - vacations and "pocket money" among them).

I'm with Midpack - give it a trial run for a couple of years and see if you can "tolerate" the change. There's no sense retiring if you're going to be miserable.

Perhaps you just need a j*b change ?
__________________
"For the time being no discipline brings joy, but seems grievous and painful; but afterwards it yields a peaceable fruit of righteousness to those who have been trained by it." ~
Hebrews 12:11

ER'd in June 2015 at age 52. Initial WR 3%. 50/40/10 (Equity/Bond/Short Term) AA.
Live And Learn is offline   Reply With Quote
Old 03-09-2013, 02:18 PM   #29
Thinks s/he gets paid by the post
Live And Learn's Avatar
 
Join Date: Feb 2012
Location: Tampa Bay Area
Posts: 1,689
Quote:
Originally Posted by Midpack View Post
Of course it won't be practical for everyone, but that does not make it categorically "impractical as a tool" in preparing for a retirement spending budget.

Many here and elsewhere have indeed reduced their spending to projected retirement levels, or as close as possible, to test the waters before pulling the plug. I didn't originate the idea, it's recommended in many published retirement books/websites as well. We most certainly did it. Although there were some minor differences in several expense accounts, they were all easy to anticipate in terms of +/- change if not in exact dollars. Having finished my second year retired, I can confirm that our planning method was sound for us - our spending has been well within 5% of expected.

And it beats picking a % out of thin air, or even someone else's actual %.

If you have another suggestion that would help the OP, I am sure it would be welcome.


+1 and +1 again.

The "point" of living on your retirement budget is to understand if you will feel the "pinch". Perhaps we should call it "Adjusted Retirement Budget" going forward, defined as "Retirement budget + / - those expenses that are KNOWN changes". The known changes would be work related expenses (commutation costs, work clothing dry cleaning), perhaps income tax (needs individual analysis), and mortgage expense (assuming that you've not paid it off pre-retirement but will have it paid off by retirement). Everything else is a lifestyle change and you need to know if you can deal with it.


Quote:
Originally Posted by Midpack View Post
Reminds me of being back at work, 'I don't have any better ideas of my own, but I'd like to criticize yours anyway...'
LOL - exactly ! Had never heard that one before but I'm going to be using that at w*rk soon !
__________________
"For the time being no discipline brings joy, but seems grievous and painful; but afterwards it yields a peaceable fruit of righteousness to those who have been trained by it." ~
Hebrews 12:11

ER'd in June 2015 at age 52. Initial WR 3%. 50/40/10 (Equity/Bond/Short Term) AA.
Live And Learn is offline   Reply With Quote
Old 03-09-2013, 02:35 PM   #30
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
youbet's Avatar
 
Join Date: Mar 2005
Location: Chicago
Posts: 9,965
Quote:
Originally Posted by Live And Learn View Post
The "point" of living on your retirement budget is to understand if you will feel the "pinch".
The point of planning for FIRE is to ensure there is no "pinch" to feel in retirement! If you plan on spending approximately the same, or perhaps a bit more, in RE as before, you're already testing your retirement budget.

Instead of "living on your retirement budget" I preferred to retire on my living budget.
__________________
"I wasn't born blue blood. I was born blue-collar." John Wort Hannam
youbet is offline   Reply With Quote
Old 03-09-2013, 02:58 PM   #31
Thinks s/he gets paid by the post
Live And Learn's Avatar
 
Join Date: Feb 2012
Location: Tampa Bay Area
Posts: 1,689
[
Quote:
Originally Posted by youbet View Post
The point of planning for FIRE is to ensure there is no "pinch" to feel in retirement! If you plan on spending approximately the same, or perhaps a bit more, in RE as before, you're already testing your retirement budget.

Instead of "living on your retirement budget" I preferred to retire on my living budget.
Agree wholeheartedly. In this case the OP is asking if he "can" live on 25% of his current income, and he specifically states that he won't be spending approximately the same. Midpack and I are trying to give him a way to determine if his ER plan is feasible.
__________________
"For the time being no discipline brings joy, but seems grievous and painful; but afterwards it yields a peaceable fruit of righteousness to those who have been trained by it." ~
Hebrews 12:11

ER'd in June 2015 at age 52. Initial WR 3%. 50/40/10 (Equity/Bond/Short Term) AA.
Live And Learn is offline   Reply With Quote
Old 03-09-2013, 03:11 PM   #32
gone traveling
 
Join Date: Feb 2013
Location: Leominster
Posts: 137
Okay so I guess I am the only one who can't see how to physically live on my retirement budget while not in retirement. I am not trying to bust anyone's bubbles here. If it is because I am dense so be it.

I can envision what I will be spending and needing for income in the future.

Do I have to actually tell my bank, "Hey look, I know I have a few more years left on my mortgage. I would like to suspend that for a year so I can see if I will be able to live within my retirement budget." Oh let's even go so far as to say I want to stop paying my life insurance too since I won't be paying that in retirement either. Oh please keep me covered okay? Oh one more tell my state that "Hey I want to pay less tax on my house since I am trying to see if I can make it in retirement. My new state will only be about half or less of what I am paying so just take this for now and well I will see if I can make it.

This is also again not taking into account with trips to England or France. Hmmmmm I just dont see that. Oh boss hey I am going to go to England for a month. Can you just do without me and can you still pay me? Yeah that will go over like a wet sock.

Look in no way am I discounting the idea but unless I can wrap my hands around the physical aspect of it then I can't see how I can make it work.

Back to the original post though at 25% of what income? What are expenses now? Will any of them change? As someone asked is your income in the ultra rich? Is your income in the lower income bracket and you are living pay check to pay check now? Is the income just generated from savings or is there a pension or two in there?

I am just saying.
__________________
GolfingDuo is offline   Reply With Quote
Old 03-09-2013, 03:23 PM   #33
Moderator
MichaelB's Avatar
 
Join Date: Jan 2008
Location: Rocky Inlets
Posts: 24,465
Quote:
Originally Posted by GolfingDuo View Post
Okay so I guess I am the only one who can't see how to physically live on my retirement budget while not in retirement. I am not trying to bust anyone's bubbles here. If it is because I am dense so be it.

./.

I am just saying.
Or, you can create lifestyle and budget now that is equivalent to the one you would afford in retirement (the 25%), and see if you can live with it. It's not about the mortgage so much as it is controllable and non-work related expenses, such as dining, travel & entertainment, etc.

If the retirement involves lowering your standard of living, it's not a bad idea to test drive the lower standard to see if it fits.
__________________
MichaelB is offline   Reply With Quote
Old 03-09-2013, 03:32 PM   #34
Full time employment: Posting here.
ShortInSeattle's Avatar
 
Join Date: Jan 2012
Location: Seattle
Posts: 517
Quote:
Originally Posted by MichaelB View Post

Or, you can create lifestyle and budget now that is equivalent to the one you would afford in retirement (the 25%), and see if you can live with it. It's not about the mortgage so much as it is controllable and non-work related expenses, such as dining, travel & entertainment, etc.

If the retirement involves lowering your standard of living, it's not a bad idea to test drive the lower standard to see if it fits.
+1. When it comes to things like a soon-to-be paid off mortgage, sure just do the math. I agree it's the other things that can be tested. For example, it's easy to say you'll spend less on eating out and entertainment, but will you? It's as much about knowing yourself as it is the numbers.

SIS
__________________
ShortInSeattle is offline   Reply With Quote
Old 03-09-2013, 03:32 PM   #35
Recycles dryer sheets
 
Join Date: Jan 2013
Posts: 96
I used the midpack approach tracking my spending for years to understand my needs and wants. Of course nobody can entirely replicate what their passive income years will look like but using the information I tracked filled in a lot of the blanks. There isn't one aspect of any of this that doesn't involve some kind of projection, assumption, forecast, estimate, liklihood, trend, plan or even a plain old guess. Whatever works for each of us but I would have been w**king the past four years rather than loving life if I didn't gain the confidence to pull the trigger that understanding my expenses provided. Personally, I think there is too much worry about running out of money and not enough worry about running out of life.
__________________
enjoyinglife102 is offline   Reply With Quote
Old 03-09-2013, 03:52 PM   #36
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
 
Join Date: Sep 2005
Location: Northern IL
Posts: 18,284
Quote:
Originally Posted by Midpack View Post
Quote:
Originally Posted by GolfingDuo View Post
All of that is true but it is not living in within those limits. It is projecting and computing. It is not actually living is the point. We can make assumptions. Those are great rules of thumb for planning purposes they are great tools.

Midpack is a very good poster here and a lot of great information and experience is packed in that 29 year old . I don't want anyone to think that I am disagreeing with the idea. I just think it is impractical as a physical tool to do that. On the flip side all the planning and calculating in the world will not account for everything either and will not be always 100% or 0% or anything in between.
...
If you have another suggestion that would help the OP, I am sure it would be welcome.

Reminds me of being back at work, 'I don't have any better ideas of my own, but I'd like to criticize yours anyway...'
Wow, Midpack, pretty harsh, isn't it?

He did make suggestions, he showed how one can obviously estimate/project their retirement expenses, same as most of suggest to others. Like in his example, do you really need to stop paying your mortgage for a year to know what it would be like to not have a mortgage payment? No, you can project that.

While some people might be able to live on retirement income before they retire, it clearly does not apply to the OP. He plans on moving to a lower cost area when he retires. That is not likely practical while he is working, is it? Even for those who can, it probably involves some projection anyhow, health care (I believe you mentioned this), commuting, etc. And many of us would want to do things we can't do when tied to a job - some of those cost (travelling), while some save (time to DIY).

And you did say "everyone should do this" - sorry, but that seems silly since so few could realistically come even close. It's not useful, and IMO, you shouldn't take it so personal and get so defensive when others see it differently from you.

-ERD50
__________________
ERD50 is offline   Reply With Quote
Old 03-09-2013, 03:56 PM   #37
gone traveling
 
Join Date: Feb 2013
Location: Leominster
Posts: 137
Quote:
Originally Posted by MichaelB View Post
Or, you can create lifestyle and budget now that is equivalent to the one you would afford in retirement (the 25%), and see if you can live with it. It's not about the mortgage so much as it is controllable and non-work related expenses, such as dining, travel & entertainment, etc.

If the retirement involves lowering your standard of living, it's not a bad idea to test drive the lower standard to see if it fits.
You are right is is about controllable and non-work related expenses. I know that I will eat out more in some places and times but less at other times. Will that even out?

That is the point of the exercise. It would seem that it still is a calculator function instead of a physical function.

Quote:
Originally Posted by ShortInSeattle View Post
+1. When it comes to things like a soon-to-be paid off mortgage, sure just do the math. I agree it's the other things that can be tested. For example, it's easy to say you'll spend less on eating out and entertainment, but will you? It's as much about knowing yourself as it is the numbers.

SIS
That has been my point the whole time. It is a math equation. If you have an idea of what income you need to live within than adjust your spending accordingly on the calculator and you are there. Knowing yourself and what you plan to do in retirement is the key here.

Sorry everyone for me not seeing it as physically making myself adapt to a budget of 100% of my current income or 25% of my current income. I guess it is because I just can only see the projection of expenses. I cannot see the test drive as nothing more than a calculation.

If the OP is planning on sitting around the house watching grass grow than yes 25% is probably pretty easy to live within. If they plan on traveling the world to a new place every month then unless they are Warren Buffett they probably can't make it with that.
__________________
GolfingDuo is offline   Reply With Quote
Old 03-09-2013, 05:00 PM   #38
Recycles dryer sheets
 
Join Date: Jul 2012
Posts: 229
For context, we would be going from the 375K-450K range now to about 90K until SS kicked in. Current Taxes are well into 6 digits for Fed. On paper, 90K looks doable and taxes look very low, especially as we spend our after tax savings, Kids are launched and we current are saving over 150K a year, but that has not always been the case. The key is looking good on paper is different then actually doing it. We did have modest income early in my career, especially since my wife left the workforce over 20 years ago.
__________________
Shanky is offline   Reply With Quote
Old 03-09-2013, 05:28 PM   #39
Thinks s/he gets paid by the post
Bikerdude's Avatar
 
Join Date: Jul 2006
Posts: 1,901
Quote:
Originally Posted by Shanky View Post
For context, we would be going from the 375K-450K range now to about 90K until SS kicked in. Current Taxes are well into 6 digits for Fed. On paper, 90K looks doable and taxes look very low, especially as we spend our after tax savings, Kids are launched and we current are saving over 150K a year, but that has not always been the case. The key is looking good on paper is different then actually doing it. We did have modest income early in my career, especially since my wife left the workforce over 20 years ago.
So if taxes are 125k and you save 150k you currently live on about 125k? Going to 90k is not (that) much of a change.
__________________
“I guess I should warn you, if I turn out to be particularly clear, you've probably misunderstood what I've said” Alan Greenspan
Bikerdude is offline   Reply With Quote
Old 03-09-2013, 06:21 PM   #40
Recycles dryer sheets
 
Join Date: Apr 2010
Posts: 412
Quote:
Originally Posted by Shanky View Post
For context, we would be going from the 375K-450K range now to about 90K until SS kicked in. Current Taxes are well into 6 digits for Fed. On paper, 90K looks doable and taxes look very low, especially as we spend our after tax savings, Kids are launched and we current are saving over 150K a year, but that has not always been the case. The key is looking good on paper is different then actually doing it. We did have modest income early in my career, especially since my wife left the workforce over 20 years ago.
I have doubts comparing income levels vs fed taxes in %'s. Who cares about the income I used to have and how much my fed taxes were?!

I would try to answer these questions - how much do you spend now on bare necessities and how much would you need in addition for discretionary spending. And it would help me find the correct answer to your initial question.
__________________

__________________
“The problem with the world is that the intelligent people are full of doubt, while the stupid people are full of confidence.”

(—Charles Bukowski)
wanaberetiree is offline   Reply With Quote
Reply


Currently Active Users Viewing This Thread: 1 (0 members and 1 guests)
 
Thread Tools Search this Thread
Search this Thread:

Advanced Search
Display Modes

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is Off
Trackbacks are Off
Pingbacks are Off
Refbacks are Off


 

 
All times are GMT -6. The time now is 11:36 PM.
 
Powered by vBulletin® Version 3.8.8 Beta 1
Copyright ©2000 - 2017, vBulletin Solutions, Inc.