Getting more focused

[Gardener]

I am trying to figure out a way to do this! I am 36, my DW is 48. Both nurses, both making about
$60,000. One 15 yo who we are not worried about paying college costs for, though we will help support him until he is in his early 20's. (Long story, basically if he does decide to go to college he will qualify for enough financial help that will make our % low enough we can just pull it out of our budget.)
No mortgage on a very modest house I love and may live in forever (on 5 acres in the mountains, beautiful views, etc.). Or may invite son to stay living in as an adult and use as a homebase while full-timing in an RV. Or may sell and full-time in the RV. All fun ideas.
$200,000 in retirement accounts. A pension for DW that should bring in about $300 a month. We do have some debt, $13,000 in CC, $20,000 in car notes. We are no longer using CC, and are paying them down.
Our goal is retirement for DW at 62, so in 14 years (I'll be 50.). If we can afford to we'll defer her SS until she is 67. W/ possible very part-time work if needed or desired for a few years (25 shifts a year = $12,000 in today's pay.) Maybe 50 shifts a year for me.
We have been putting in 20% into our 403B's (like a 401K.) Today I increased mine to 25%. We'll see if that creates any problems.
We anticipate money loosening up after a few years as so much of our money has gone into remodelling our house. Also, as our son hits 18 my DW may go back to work full-time, which will increase her salary.
Our goals are travel, here and abroad. We are both very happy in an RV in the woods.
I am hoping we will be able to afford to visit India, Belize, Bali, etc. I am anticipating 3 or 4 month trips, renting an apartment, etc as a way to save money. Then back to the US to work for a few months (for me at least.)
What do you guys think? Any gaping holes in my logic (other than trying to plan 14 years in advance.)
Gardener

 

[ronocnikral]

One 15 yo who we are not worried about paying college costs for, though we will help support him until he is in his early 20's. (Long story, basically if he does decide to go to college he will qualify for enough financial help that will make our % low enough we can just pull it out of our budget.)

this seems to be a big gaping hole to me. i'm quite curious how your son will qualify for financial help (unless grandma is paying)...hopefully it's not the gov't you are talking about with each of you making $60k.

FAFSA4caster - Federal Student Aid

 

[Gardener]

Native American kid, adopted out of fostercare after years of homelessness. I only mention b/c why yes, there are scholarships out there. Hates school, does not want to go to college. We will push him to, and be grateful if he graduates from high school. The GED is free here (the utility company pays for it, of all things.) We will also "encourage with maximum effort" him toward a state 4 year school. There is also the "lottery scholarship" the kids get in NM. Short of that I or DW could (easily) get a job at the University's hospital, which would make his tuition free. Or, what I see as more likely, is that he will go to community college and live at home. If I remember correctly the last time I took a class at the local CC (last year) it was around $30 a credit. Add a thousand for books and fees a semester, and we are still looking at less than I currently pay for his tournament soccer team a year ($1000) plus football ($250) plus snowboarding club ($700.) Oh, and the state will pay $1100 a month if he is in school after he is 18 for a couple years. Part of his adoption contract.
Most likely is that he will join the military. He talks about it, and is in ROTC and a "military skills" class in High School.
I adore my kid - he is a delight, and if he has a huge personality change and wants to go to Harvard, we'll figure it out. But I don't see this as a likely issue.
Gardener

 

[ronocnikral]

touche. you could have stopped at native american. thanks for sharing.

 

[Gardener]

Yeah, I could be wrong, but I think we are good on that particular issue.
Now to figure out the rest of this retirement savings!
Gardener

 

[jimnjana]

Gardener,

What about health insurance, would you be covered if you and DW were part timers? Why defer DW social security? I'm asking because DW and I have similar age gap. I guess if I were working part-time we may do the same. Right now I'm thinking that she will take hers when eligible and I will take a spousal benefit at age 63 then switch to mine at age 67 or 70. We may defer taking hers a year or so if we decide to spend down her TSP prior to her taking ss. Good luck...

 

[Milton]

"Gaping hole": you have not said anything about your anticipated expenses in retirement. It is difficult to project 14 years out, but what are your current expenses? The latter should give you a very rough idea of what you'll need each year. Then you can look at your anticipated income (including SS and employment pensions, as well as investment income) and be able to assess how realistic your plan is.

Hates school, does not want to go to college. We will push him to, and be grateful if he graduates from high school.... We will also "encourage with maximum effort" him toward a state 4 year school.... Most likely is that he will join the military. He talks about it, and is in ROTC and a "military skills" class in High School.

Post-secondary studies are not for everyone. Rather than coercing him into doing something he doesn't want to do, I'd suggest being supportive of what he does want.

It's not like joining the military would be dishonourable. Also, there is a real possibility that his service will motivate him to return to school, with a sincere desire to study hard and do well.

 

[Gardener]

I wouldn't try to coerce him into anything. He is so disinterested in school I chose all his classes (b/c he refused to) so I am the one who put him into ROTC and military skills. I am sorry I came across as anti-military, I was a Army Reserves in my 20's and am not anti-military, however, I am not sure it would be a good fit for him.
Right now my nephew is having a terrible time after 2 tours in Iraq. PTSD, brain injury (somewhat mild), drugs, alcohol, failed suicide attempt. Floundering about, though I believe he will find his way. Wonderful, sweet kid, who thought it was honorable and patriotic to join the Marines.
I know most people come back, and are able to go on with their lives. But I also have some knowledge, from being a nurse and also from working in a homeless shelter in 1991 or so (in my teens.) We used to say, "How do you end up homeless? Drugs, alcohol, mental illness and Vietnam."
Okay, I hope I haven't offended anyone, just trying to explain my hesitation. I am his mom, after all. On the other hand, my kid could really benefit from the structure, the discipline, the brotherhood. I keep telling him, what about the Airforce? What about the Coast Guard? Be an air traffic controller, or a mechanic! He is really gifted spatially. But he will definitely decide on his own.
Gardener

 

[Gardener]

Gardener,

What about health insurance, would you be covered if you and DW were part timers?

I think healthcare is so up in the air 14 years from now I won't even predict! There are so many changes coming, and I anticipate they will be good for us.


Why defer DW social security?

I played with a calculator and got the impression we would get more total money by deferring until 67, the crossover point being as long as she lives past 78. Which I expect (and pray) she will. I am not sure how inflation should be factored into that, however. Plus she may want to work to fill in any budgetary holes, and you really get hit money wise if you do that.
Gardener

 

[Gardener]

I need to figure out the budgetary part... It seems right now it will be such a guess! Currently we spend quite a bit on our son's activities, a lot on gas (we live out in the country, have 4WD vehicles, 25 mile each way commutes, and have to pick up our kid from school everyday so he can play sports (20 miles.) We are happy w/ those expenditures, but obviously expect those to go away or be very reduced in the future. After our son is older we will be able to work the same shifts, and cut our work commutes in half. If we end up full-timing in an RV for several years ther should be some savings - we lived in an RV for 8 months and there was a lot less money going out every month. Less utilities, less stuff I could buy.
I expect we could happily live on 50% of what we make now, plus some amount for travel. But this is a wild estimate, I know. I am basing that on a 20% savings rate that I won't be continuing when we ESR, a lower amount of taxes, less $ spent on our son, more time at home so we can save some money on things we pay to have done for us. And a huge amount of our money for the last 3 years has been remodelling this house.
Gardener

 

[Nords]

Right now my nephew is having a terrible time after 2 tours in Iraq. PTSD, brain injury (somewhat mild), drugs, alcohol, failed suicide attempt. Floundering about, though I believe he will find his way. Wonderful, sweet kid, who thought it was honorable and patriotic to join the Marines.
I know most people come back, and are able to go on with their lives. But I also have some knowledge, from being a nurse and also from working in a homeless shelter in 1991 or so (in my teens.) We used to say, "How do you end up homeless? Drugs, alcohol, mental illness and Vietnam."

Couple of counterpoints, admittedly without handy references.

My nephew the Army Ranger has had two tours in Afghanistan (2001 & 2002), Iraq pre-game, and a "regular" Iraq deployment. His GF (field medical asst) is leaving in a few weeks for her Iraq deployment. While both are skeptical and cynical far beyond their years (breathtakingly so even from my perspective), they've come through fine. "So far so good".

I've read summaries of studies of Vietnam vets claiming that their homeless population is no greater than their demographic. In other words, being a Vietnam vet is no more likely to lead to homelessness than other racial or occupational factors. But I'd love to read a study or two on that.

My impression of the last 10 years of warfare is that the U.S. military (and society in general) was far more ready to handle funerals than to cope with hospitals & rehab. Judging from some of the current diagnoses I'm hearing about, compared to my years of service, we're also getting far better at identifying syndromes and issues that heretofore were classified as "whining". It's about time that these issues are finally getting the attention that they deserve.

I've seen many people pass on college for one reason or another, and usually they're the right reasons. But the only thing I've seen that really motivates someone to go to college, even more than getting out of their parents' house, is a military tour plus the GI Bill.

 

[Sarah in SC]

There is an 8 year gap with us, so not as much as with you, but I also struggle with developing budgets so far in advance. That is going to be the more fluid part of your plan going forward.
We'll not be retiring together, as you hope to, simply because I'm behind him in savings and "time served".
The only suggestion I'd make is to tinker with the projections as you go forward with plans for DWs return to work possibly, or the increase of savings goals, etc to see how you feel about your standard of living at different levels of expenses.
We periodically "live" on just one salary to see how it works.
And kudos to you for your support of your kid's chosen path, whatever it turns out to be.