How long to go

[VMKV]

Hi I am new here. Just figuring things out. I married 45, two kids in high school. They'll go to state schools I figure I'll be able to cover 2-3 years with what I have saved now and have talked with them about covering the rest. I have 1.1 million in retirement savings. $880k in traditional 401k, remainder in Roth. We max out our retirements each year with decent employer matches. I figured I had to work until 65 but with 20 years to go I am refiguring hoping I could do 55 but more realistically 58-60. Spouse and I make roughly the same amount, 125k each and we enjoy traveling but don't have lavish spending otherwise, house is paid off. I am trying to figure out how to budget without the kids since they take up so much of the budget now. I know it will change soon enough but am having a hard time coming up with a retirement budget that will allow me to firm up the numbers and set a real goal. Also if 55 is possible I also think I'll need 'out of retirement' account to cover the cost before I reach 59.5. Additionally the wife and I will both want to travel or become snow birds when the time comes so I'll need to budget for that too. Any suggestions or thoughts? I have enjoyed poking around the site but haven't gotten too much in it yet.

 

[njhowie]

How much is the house worth? How much do you have in savings outside of the retirement accounts?

 

[Dtail]

What are your plans for covering pre medicare medical?

 

[braumeister]

Read these first:

http://www.early-retirement.org/forums/f47/some-important-questions-to-answer-before-asking-can-i-retire-69999.html

And then use this (read the instructions on the first page:
FIRECalc: A different kind of retirement calculator

 

[VMKV]

What are your plans for covering pre medicare medical?

This is one of the costs I am trying to get a handle on, a financial guy told me $1,000 per month ... I haven’t a clue if that’s accurate

 

[VMKV]

How much is the house worth? How much do you have in savings outside of the retirement accounts?

House is worth $330k but I have to live somewhere so I’m not counting on downsizing to gain money .. I have about 100k in savings outside saving for either a second home or just cash to live on, we haven’t decided yet.

 

[MRG]

Check out the "rule of 55" regarding 401K withdrawals before 59.5, also a 72T could serve to bridge your gap between retirement and 59.5.

Of course right now, it might be great to have now-retirment assets to keep income low for ACA subsidies.

Good luck to you.

 

[Dtail]

This is one of the costs I am trying to get a handle on, a financial guy told me $1,000 per month ... I haven’t a clue if that’s accurate

For some info on medical costs, please check out Healthsherpa.com and Healthgov.org
There can be substantial tax subsidies and savings if you can keep your taxable income (MAGI officially) below the cliff (typically 64k for a couple).

 

[Conundrum]

I see you mention budgeting. I suggest start tracking your spending very closely at least a couple of years before you pull the plug. It’s a great exercise to go back over those few years so you can develop a realistic budget to model your retirement on. Our kids are out on their own now. Our expenditures haven’t really changed much cause we increased our fun budget.

A mistake I made was not building up the balance of a post tax account. It’s great for smoothing your income year to year to hit your desired MAGI number.

Never hurts to have a HELOC just in case

 

[fleefromhome]

Our expenditures haven’t really changed much cause we increased our fun budget

+1 We are not retired yet but we increased trips and fun spending once our kids were fully launched, because of our new found freedom. Our penny pinching habits loosened because they are successfully launched, perhaps.