Greetings,
I stumbled upon this place like so many others, and let me add my appreciation for all the great info you folks have provided.
My wife and I first thought of retiring early a few years ago, and after crunching some numbers I think I'm starting to get a good handle on it. Here's what I've come up with - I'd sure appreciate anyone pointing out obvious errors or omissions I might have made.
Our stats are virtually identical in all regards, so planning seems pretty straightforward. We're the same age, are both public employees working at the same place (identical retirement and benefit plans/investment options), and will both leave at the same time with similar service - 21 and 23 years in.
Details:
Ages: 44
ER Ages: 50 (early 2011)
Assets:
Current combined pre-tax plans (401k's, 457b's, 401a's): $300K
Anticipated pre-tax plans at ER age: $850K (continuing with maximum contributions, assuming 7% rate of return)
Home equity won't be huge; we've leveraged it pretty heavily to do some remodeling and acquire our retirement property. We'll probably have around $200K equity at ER age, but that will need to be used to build a home on our new property. It won't need to happen right away...we'll have an in-law unit that we could live in initially.
Both of our pensions kick in at 54, so the most critical area for planning seems to be the 50-54 window. Of the three types of pre-tax plans, we can withdraw funds from the 457b's with no tax penalty, so it seems to make sense to primarily rely on those funds from age 50-54.
Health insurance is a bit of a concern. If I understand things correctly, we can continue our existing group coverage under COBRA for 18 months after leaving, which in today's dollars is between $750 and $950 per month, depending on the plan. At 54, our retirement plans give us each a health insurance benefit (currently $450 each per month), so I'm guessing we'll be OK at 54. What we'll do for the 2 1/2 years between COBRA and retirement benefits is the main concern - I don't really know what expenses to plan for there. We're currently both healthy, with no serious family health issues. We currently live in CA, will be retiring to WA if that makes a difference.
I've plugged the above details into FIRECalc, and the numbers look really good at success rates of 90%, and acceptable at 95%.
Thanks for any comments and/or suggestions...I expect to be a knowledge drain around here for a while.
I stumbled upon this place like so many others, and let me add my appreciation for all the great info you folks have provided.
My wife and I first thought of retiring early a few years ago, and after crunching some numbers I think I'm starting to get a good handle on it. Here's what I've come up with - I'd sure appreciate anyone pointing out obvious errors or omissions I might have made.
Our stats are virtually identical in all regards, so planning seems pretty straightforward. We're the same age, are both public employees working at the same place (identical retirement and benefit plans/investment options), and will both leave at the same time with similar service - 21 and 23 years in.
Details:
Ages: 44
ER Ages: 50 (early 2011)
Assets:
Current combined pre-tax plans (401k's, 457b's, 401a's): $300K
Anticipated pre-tax plans at ER age: $850K (continuing with maximum contributions, assuming 7% rate of return)
Home equity won't be huge; we've leveraged it pretty heavily to do some remodeling and acquire our retirement property. We'll probably have around $200K equity at ER age, but that will need to be used to build a home on our new property. It won't need to happen right away...we'll have an in-law unit that we could live in initially.
Both of our pensions kick in at 54, so the most critical area for planning seems to be the 50-54 window. Of the three types of pre-tax plans, we can withdraw funds from the 457b's with no tax penalty, so it seems to make sense to primarily rely on those funds from age 50-54.
Health insurance is a bit of a concern. If I understand things correctly, we can continue our existing group coverage under COBRA for 18 months after leaving, which in today's dollars is between $750 and $950 per month, depending on the plan. At 54, our retirement plans give us each a health insurance benefit (currently $450 each per month), so I'm guessing we'll be OK at 54. What we'll do for the 2 1/2 years between COBRA and retirement benefits is the main concern - I don't really know what expenses to plan for there. We're currently both healthy, with no serious family health issues. We currently live in CA, will be retiring to WA if that makes a difference.
I've plugged the above details into FIRECalc, and the numbers look really good at success rates of 90%, and acceptable at 95%.
Thanks for any comments and/or suggestions...I expect to be a knowledge drain around here for a while.