I think a lot of you like to ponder FIRE scenarios so here is your chance to take a whack at mine. I am trying to make this a bit of fun by making a poll. Of course your comments either good or bad are appreciated.
Here is the story as briefly as I can state it:
First and foremost I am tired of w*rking and ready to hang it up, the sooner the better. I really do not want to w*rk past 62 if I don’t need to. So far, I have w*rked 38 years full time employment plus another 7 years part time starting at age 14. I am 59 and my wife is nearing 58. DW and I are trying to exercise and eat healthy, we want to have as many active years as possible to travel and enjoy life.
Both DW and I are employed, gross income 2011 was about $150,000 and expect that to be more or less the same for the remaining years I w*rk. We have tracked spending VERY closely for the last three years.
2009 spent $37,000
2010 spent $39,000
2011 spent $44,000, about $4,000 of the total was for one time landscaping
2012 Estimated spending $41,000
Other than noted for 2011, these yearly figures do not include any major purchases such as new autos or major home repairs. Nor does it include more than maybe $1,000 in miscellaneous medical expenses. We have no mortgage and are totally debt free. No idea what the home is worth now-a-days but I am guessing about $275,000. If we ever decided to relocate to a warmer climate we would basically replace our house with another of similar value.
Vehicles: 1 pick-up 9 years old and will go at least 5 more years, a seven year old 4 door sedan that we plan on replacing within 1 or 2 years. This is the vehicle we use for long trips so we want something very reliable. In the future we would only replace a vehicle about every 8 years.
Health insurance is the big wild card. When I hang it up, we am totally on my own. DW is probably high risk due to breast cancer 3 years ago. All is fine now but I have no idea what health insurance will cost till we reach Medicare age. For health insurance I am guessing about $25,000/year for 7 years if we stopped working now until we qualify for Medicare.
I estimate my investments, at least for the next 3 years would grow by $100,000 per year between my savings and expected earnings so long as I am still working.
Currently our investments are very conservative.
$188,000 I-Bonds
$400,000 CD Ladder 1 to 7 year maturities
$1,112,000 various IRAs and 401K, invested fairly conservatively, Wellesley, Vanguard Target Retirement Fund, a tiny bit in Index 500
So as not to make this too confusing please assume that at retirement, I would theoretically invest this IRA & 401K money is something with asset mix similar to Wellesley.
Whenever we retire I expect to live on the CD ladder until our full SS retirement age of 66. I estimate our SS income would be $48,000/yr. in today’s $. Any years between retirement and start of SS will have basically minimal interest income from the CD ladder that I will be taxed on. I think I will have an opportunity to convert quite a bit of TIRA money to Roth IRA money.
Oh, we both have tiny frozen pensions that are non cola, both will total about $6000 per year starting at age 65..
I estimate we will need about $80,000/year in today’s $, from investments and eventual SS. I base this on our current yearly spending of approx. $40,000, plus $25,000 for a guesstimate of high deductible health insurance, plus another $15,000 for taxes. . Of course, the taxes would not be $15,000 in the gap between retirement and full SS if I am living only from CDs. And a chunk of the $25,000 for health insurance premiums should disappear when we reach Medicare age.
When I run firecalc and input $80,000 per year spending with $1.7 million portfolio and 34 years I get 70% success rate. When I add in SS at age 66 it says 100% success rate. However, I know I do not have the couch potato portfolio 75% stocks. It is very difficult for me really figure out how to input these kinds of variables in Firecalc.
I hope I have covered the important bits to give a clear picture. If you care to, please vote when you would retire if you were in my shoes.
Here is the story as briefly as I can state it:
First and foremost I am tired of w*rking and ready to hang it up, the sooner the better. I really do not want to w*rk past 62 if I don’t need to. So far, I have w*rked 38 years full time employment plus another 7 years part time starting at age 14. I am 59 and my wife is nearing 58. DW and I are trying to exercise and eat healthy, we want to have as many active years as possible to travel and enjoy life.
Both DW and I are employed, gross income 2011 was about $150,000 and expect that to be more or less the same for the remaining years I w*rk. We have tracked spending VERY closely for the last three years.
2009 spent $37,000
2010 spent $39,000
2011 spent $44,000, about $4,000 of the total was for one time landscaping
2012 Estimated spending $41,000
Other than noted for 2011, these yearly figures do not include any major purchases such as new autos or major home repairs. Nor does it include more than maybe $1,000 in miscellaneous medical expenses. We have no mortgage and are totally debt free. No idea what the home is worth now-a-days but I am guessing about $275,000. If we ever decided to relocate to a warmer climate we would basically replace our house with another of similar value.
Vehicles: 1 pick-up 9 years old and will go at least 5 more years, a seven year old 4 door sedan that we plan on replacing within 1 or 2 years. This is the vehicle we use for long trips so we want something very reliable. In the future we would only replace a vehicle about every 8 years.
Health insurance is the big wild card. When I hang it up, we am totally on my own. DW is probably high risk due to breast cancer 3 years ago. All is fine now but I have no idea what health insurance will cost till we reach Medicare age. For health insurance I am guessing about $25,000/year for 7 years if we stopped working now until we qualify for Medicare.
I estimate my investments, at least for the next 3 years would grow by $100,000 per year between my savings and expected earnings so long as I am still working.
Currently our investments are very conservative.
$188,000 I-Bonds
$400,000 CD Ladder 1 to 7 year maturities
$1,112,000 various IRAs and 401K, invested fairly conservatively, Wellesley, Vanguard Target Retirement Fund, a tiny bit in Index 500
So as not to make this too confusing please assume that at retirement, I would theoretically invest this IRA & 401K money is something with asset mix similar to Wellesley.
Whenever we retire I expect to live on the CD ladder until our full SS retirement age of 66. I estimate our SS income would be $48,000/yr. in today’s $. Any years between retirement and start of SS will have basically minimal interest income from the CD ladder that I will be taxed on. I think I will have an opportunity to convert quite a bit of TIRA money to Roth IRA money.
Oh, we both have tiny frozen pensions that are non cola, both will total about $6000 per year starting at age 65..
I estimate we will need about $80,000/year in today’s $, from investments and eventual SS. I base this on our current yearly spending of approx. $40,000, plus $25,000 for a guesstimate of high deductible health insurance, plus another $15,000 for taxes. . Of course, the taxes would not be $15,000 in the gap between retirement and full SS if I am living only from CDs. And a chunk of the $25,000 for health insurance premiums should disappear when we reach Medicare age.
When I run firecalc and input $80,000 per year spending with $1.7 million portfolio and 34 years I get 70% success rate. When I add in SS at age 66 it says 100% success rate. However, I know I do not have the couch potato portfolio 75% stocks. It is very difficult for me really figure out how to input these kinds of variables in Firecalc.
I hope I have covered the important bits to give a clear picture. If you care to, please vote when you would retire if you were in my shoes.
