Hello Everyone, I've been a reader for 2 years but first time posting. I turned 52 late last year and am planning an early exit strategy in case my work drives me crazy enough to retire early, which would be at 55. I'm in CalPERS, but have been a consultant for half of my 27 years career so I don't have a lot of service years with CalPERS. If I do retire once I turn 55, I should be able to get about 32% of my current salary via CalPERS. I do worry that I won't have enough to live on comfortably if I retire at 55 as I have read many reports and studies saying that $1 Million is not nearly enough. Here's my situation, I'm a single female, no kids but have 3 cats and I feed many strays and TNR them as well. My widowed mother lives with me (she collects SS but I pay for everything). I plan to live in my small mortgage-free house until I die and since I promised my parents I would pass it onto my nephew and niece, I will not count this as part of my asset.
I live in Southern California and although I plan to travel a lot, I do not plan to move out of state. I have approximately $125K in 457b, $1 M in 401K, $225K cash, $475K investments, $250K ROTH. I will get approximately $50K/year in pension. Currently I average about $45K per year in expenses (necessities, hobbies, charitable contributions). Since I would be retiring with less than 20 years CalPERS service, I will only get 80% contribution to health insurance and will have to pay approximately $500/month out of pocket for premiums. I do not foresee a reduction in my expenses although there could be a change in types of activities (currently I snowboard, travel, and eat out as hobbies, plan to continue, and contribute more to charity and more volunteering). I have never had to budget so I'm not sure I will be able to afford to retire and live for optimistically 35+ more years on what I have (Mom's side lived to 100, Dad passed away at 75 so maybe I'll be lucky to reach 80).
So assuming I will have $50K/year in pension, I plan to withdraw $50K/year from my 457b plan (I anticipate at 55, I will have about $250K in the account as I currently max out my pre-tax deductions for my 401K and 457b), so that should last me until I'm 60. From 60 to 70, I plan to withdraw from my 401K accounts, and at 70, I will withdraw the minimum required from 401K (what's left of it) and file for Social Security (expect it to be maxed at $50K/yr). I was very worried whether there would still be Soc Sec by the time I file, but a friend who is now 67 told me not to worry, that there's no way the government will let SS fail although they might reduce it. I hope he's right. I'm thinking with $100K pre-tax, I would have to pay $25K tax and leave me $75K/year for expenses/some wiggle room. I also have LTC insurance that is projected to cost up to $10K/year (currently paying $3200/year). Will I have enough to live on and last me until the end with this withdrawal plan? Suggestions to other withdrawal strategies would be welcome. Thanks all!
I live in Southern California and although I plan to travel a lot, I do not plan to move out of state. I have approximately $125K in 457b, $1 M in 401K, $225K cash, $475K investments, $250K ROTH. I will get approximately $50K/year in pension. Currently I average about $45K per year in expenses (necessities, hobbies, charitable contributions). Since I would be retiring with less than 20 years CalPERS service, I will only get 80% contribution to health insurance and will have to pay approximately $500/month out of pocket for premiums. I do not foresee a reduction in my expenses although there could be a change in types of activities (currently I snowboard, travel, and eat out as hobbies, plan to continue, and contribute more to charity and more volunteering). I have never had to budget so I'm not sure I will be able to afford to retire and live for optimistically 35+ more years on what I have (Mom's side lived to 100, Dad passed away at 75 so maybe I'll be lucky to reach 80).
So assuming I will have $50K/year in pension, I plan to withdraw $50K/year from my 457b plan (I anticipate at 55, I will have about $250K in the account as I currently max out my pre-tax deductions for my 401K and 457b), so that should last me until I'm 60. From 60 to 70, I plan to withdraw from my 401K accounts, and at 70, I will withdraw the minimum required from 401K (what's left of it) and file for Social Security (expect it to be maxed at $50K/yr). I was very worried whether there would still be Soc Sec by the time I file, but a friend who is now 67 told me not to worry, that there's no way the government will let SS fail although they might reduce it. I hope he's right. I'm thinking with $100K pre-tax, I would have to pay $25K tax and leave me $75K/year for expenses/some wiggle room. I also have LTC insurance that is projected to cost up to $10K/year (currently paying $3200/year). Will I have enough to live on and last me until the end with this withdrawal plan? Suggestions to other withdrawal strategies would be welcome. Thanks all!
