Hey, I wanted to bounce this off of you folks. It's mainly questions about how taxable vs. retirement accounts work for ER minded people.
I want to accumulate assets over the next 17 years and start withdrawing some of my profits at the age of 45 as a supplement ($20k) to my military pension. Does it really make sense for me to be looking at stuff like TSP and IRA accounts? They are designed for people to start withdrawing money at traditional retirement ages. I know that a ROTH allows you to withdraw your contributions at any time without penalty, but at the same time, the ROTH contribution limits mean that not much of that amount (relatively) would be in a ROTH anyway ($75k maybe?). I could put more than that in a TSP ($240k +/-) and just take my $20k supplement from the profits of the $585k left in taxable accounts, I suppose.
Some of these numbers look high for the time period, but I’m saying that if I averaged 7% return compounded over an accumulation period of 15 years, I’d wind up with just shy of $900k in total investment assets. One problem is, I’m not even sure where I came up with that 7% figure. It has just been in one of my spreadsheets for a while now. Oops. I think I got it from this board somehow, but I have this odd habit of deciding things and then forgetting the reasoning behind them. Is it possible/reasonable/safe as an aim? Or should I be figuring more conservatively?
Aside from that, though… what are some general thoughts about retirement accounts vs. normal taxable accounts for someone in my situation with this ER strategy? Is there an example somewhere of how much advantage it would be for me to have a couple hundred thousand in ROTH/TSP rather than placing it all in normal investment accounts?
I’d also like to do some conservative real estate stuff in the coming years (purchase some rentals, etc.), so I can’t afford to have capital completely tied up if I get involved with that. Just more thoughts.
Joshua