30 year old whose looking for helpful advice to retire at 56

[Aerides]

You're about where I was around 35, and we retired at 47.

Don't consider wife/children as "lifestyle creep" but do factor in that a family might result in a change of specific straight line plans. Life isn't all about racing to the finish line.

 

[YVRRocketSurgery]

I don't want to discount the fundamentals of LBYM but what gave perspective to my FIRE plans was tracking my spend and building a spreadsheet of all my finances tracking the year end results and forecasting what my numbers would be each each year. That kind of gave me metrics on where I was on my FIRE schedule, if I needed to course correct or could let off the gas a bit, and where I could/needed to make adjustments.

The other aspect is that I started to think what I wanted to do in retirement to ensure my numbers matched up with my retirement goals. In theory, I suppose, you can stay the same person, spending the same amount of money as you age. But the risk is that your interests, priorities, and goals in life may evolve and get more refined over time.

 

[marko]

I hope to live to see your post at 56 that you retired and can live like a king for the rest of your life.

I hope to see his post too when he's 56. I'll be (or should have been) 91 at that point, so I really, really hope I can read his post!

 

[scrabbler1]

Hi so im a 30 year old single man a d i want to retire at age 56 i make 95k a year who has the following...in my 457 plan i have 155k, my roth ira 10k, cash 20k, im fortunate to have 2 pension plans but... one i will get around 1000 a month when i turn 65 and the other i will get 72 percent of my final average pay when im 67 with 1.5% cola, i have no social security...the only debt i have is my house which i purchased recently for 200k and i owe 160k. Currently i max out my 457b 18k every year and i contribute 2k a year to my roth ira. Ive read alot of posts on this site and i feel the people on here can help point me in the right direction. Thank you!

I retired 9 years ago at 45. The ER plan I put together was in 2 parts. The first part was getting from age 45 to age ~60, the years I would be relying only on my non-retirement accounts. The second part was beyond age ~60 when my "reinforcements" would kick in. Those included unfettered access to my rollover IRA, my frozen company pension, and Social Security.

The further away from age ~60 you want to retire, the more money you will need in your non-retirement accounts to get to you to age ~60 when you will have unfettered access to more of your money. I was able to move half of my retirement account money (company stock) to my taxable account (without taking a huge tax hit) and that provides me more than enough monthly dividend income from a big bond fund to cover my expenses.

As long as I get to age ~60 intact financially, I will be fine because my financial outlook only gets better after that.

Like you, MJT411, I am single. Being that and childfree and debt-free (paid off the mortgage at age 35) were big reasons as to why I was able to retire 9 years ago at 45.

 

[MJT411]

I retired 9 years ago at 45. The ER plan I put together was in 2 parts. The first part was getting from age 45 to age ~60, the years I would be relying only on my non-retirement accounts. The second part was beyond age ~60 when my "reinforcements" would kick in. Those included unfettered access to my rollover IRA, my frozen company pension, and Social Security.

The further away from age ~60 you want to retire, the more money you will need in your non-retirement accounts to get to you to age ~60 when you will have unfettered access to more of your money. I was able to move half of my retirement account money (company stock) to my taxable account (without taking a huge tax hit) and that provides me more than enough monthly dividend income from a big bond fund to cover my expenses.

As long as I get to age ~60 intact financially, I will be fine because my financial outlook only gets better after that.

Like you, MJT411, I am single. Being that and childfree and debt-free (paid off the mortgage at age 35) were big reasons as to why I was able to retire 9 years ago at 45.

Thanks for the reply thats what i need to do is figure out my first part of when i want to retire then the 2nd part. That makes alot of sense. I say 56 but maybe i can retire early if the numbers work for me....

 

[gcgang]

Buy your toilet paper on sale, wrt A Tobias.

 

[jcnyc]

I just turned 31 and can say you're on a better track than most. Don't have kids, unless you actually want to. But do NOT do it jus tbeacuse you feel like that's what is expected, bucking to some sort of antiquated societal norm. That'll shave decades off your ER path.

 

[MJT411]

So a update with me I recently up my Roth ira so now I will be maxing out that for the next year. But now I want to start a brokerage account. How and where do I get started with opening one. Who should I set it up with? Thank you

 

[UnrealizedPotential]

So a update with me I recently up my Roth ira so now I will be maxing out that for the next year. But now I want to start a brokerage account. How and where do I get started with opening one. Who should I set it up with? Thank you

I think you should certainly consider Vanguard or Fidelity. Two of the biggest. None of them are perfect, but I would go with either one. Vanguard has low fees I believe. All you have to do is call them and tell them what you want. They will answer your questions and guide you through the process of opening a brokerage account.

If you want you can just open up a brokerage account, put some money in a cash account linked with the brokerage account, and then decide what to do with it later as opposed to investing it right away on the advice of a representative. Take your time. Then when you are sure you have made up your mind take action.

 

[kgtest]

So a update with me I recently up my Roth ira so now I will be maxing out that for the next year. But now I want to start a brokerage account. How and where do I get started with opening one. Who should I set it up with? Thank you

You can open a vanguard brokerage account right on the website. Just need to open the account and fund it from a checking account. I would mention HSA as an option as that offers a more tax advantage approach. Sure the money can only be used foe qualifies medical expenses but it's still better deal dollar for dollar.

I have a Roth IRA brokerage and regular Brokerage through vanguard. I think they offer trades under 7.95 and even cheaper if you do a lot of transactions. I only bought AAPL at $96 in ours and held so far no selling in the brokerage. I also have a TD Ameritrade brokerage that has been idle since i found vanguard.

I would also advise at your age you seriously consider back door Roth conversion of $5500 this year. You might think it's too soon but the more you get into their today the less you pay on tax later and avoid RMDs on the Roth bucket of money. You will want as much in Roth as you can and if you convert $5500 today it will cost less than if yoy concert it later because i see you will have two pensions and are likely to be in a higher or less favorable tax bracket later. Paying tax on the small conversion now will be much better than paying it on a large conversion in a higher bracket later..

 

[PandaBear]

Something to consider...my dh's company ended their pension plan. Not so bad for us, as dh is closer to retirement but we definitely lost money. Younger guys, though, lost a lot of potential pension. So life can sometimes through you a curveball (or rather, mega-corp)

 

[MJT411]

Hello everyone just giving everyone a update on me I'm still maxing out my 457 and roth ira. I havent started my brokerage account but am looking to do it very soon. I recently got a part time job that pays me 15$ a hour working roughly 15-20 hours a week. I was figuring that with my new income I would just put it all into a brokerage account any ideas?

 

[exnavynuke]

Hello everyone just giving everyone a update on me I'm still maxing out my 457 and roth ira. I havent started my brokerage account but am looking to do it very soon. I recently got a part time job that pays me 15$ a hour working roughly 15-20 hours a week. I was figuring that with my new income I would just put it all into a brokerage account any ideas?

Sounds like a good idea. I'm personally a big fan of Boglehead style investing and recommend going with your preferred brokerage that can, hopefully, result in no trading fees for your investments.

At $95k/year for your primary job, I'm just wondering why you also picked up a second job that pays much less? It's your life, but spending another 20 hours/week working for a lot less than you do in your normal job seems like an unnecessary step that, while providing a relatively small financial benefit, results in a decreased work/life balance for you.

 

[wolf]

This worked for me. Retired 55. Not by choice.

1. Autos- Keep for 10+ yrs. Pay cash. If you finance. 3yrs. max.
2. Rental Real Estate. You are young. Do your own repairs. Tenants pays off the mortgage.
3. Depreciation. On the rental. Will lower your taxable income!
4. Avoid REIT as alternative to Rentals.
5. Annuities. Run away.
6. Do not become obsessed with retirement. Enjoy life and spend. Moderation is the
key.