Hello everyone. I’m happy to have found this site. I will be 49 years old in a couple of months and planning to retire next year. DW is 51 and we have no kids. I’d like to get your opinions on what I’m thinking and hopefully get some feedbacks. Thank you!!
DW – Semi-retired. Income is about 50K/year before tax. She plans on doing the same thing in the next few years since she likes what she’s doing. I am not counting on her income since it’s not stable and can end at anytime.
Primary Residence: It’s worth about 850K and has about 110K left on the mortgage.
Rental 1: It’s worth about 350K and it is paid off. The rental income after taxes and expenses just about covers the property tax, HOA, and Mello Roos of our primary residence.
Rental 2: It’s worth about 420K and it has a 280K mortgage. The rental income is about break-even after taxes and expenses.
I will be paying off the mortgage of our primary residence as soon as I stop working.
We have no debts so the basic monthly expense will be 30K/year.
So this will be the picture after the mortgage is paid off:
Taxable Savings:
Cash & CD’s: 300K
Stocks & Bonds: 250K (95% Equities 5% Bonds)
Deferred Savings:
Regular:
Stocks: 250K
Indexed Funds: 500K
Roth:
Aggressive Funds: 300K
The plan is to spend down the taxable savings for the next 10 years, then start tapping the deferred savings after that.
Next year, I plan to start buying 10-year TIPS with my regular deferred savings at 80K/year for the next 10 years. When I turn 60, I will use half of the matured monies to cover basic expenses and the other half to buy 10-year TIPS each year for the following 10 years. Basically, the idea is to be covered until I'm 80.
I also plan on either buying a SPIA or longevity insurance when I’m around 60. And depending on the stock market, I may liquidate the rental properties to accomplish this.
What do you think of this plan? Thanks again.
DW – Semi-retired. Income is about 50K/year before tax. She plans on doing the same thing in the next few years since she likes what she’s doing. I am not counting on her income since it’s not stable and can end at anytime.
Primary Residence: It’s worth about 850K and has about 110K left on the mortgage.
Rental 1: It’s worth about 350K and it is paid off. The rental income after taxes and expenses just about covers the property tax, HOA, and Mello Roos of our primary residence.
Rental 2: It’s worth about 420K and it has a 280K mortgage. The rental income is about break-even after taxes and expenses.
I will be paying off the mortgage of our primary residence as soon as I stop working.
We have no debts so the basic monthly expense will be 30K/year.
So this will be the picture after the mortgage is paid off:
Taxable Savings:
Cash & CD’s: 300K
Stocks & Bonds: 250K (95% Equities 5% Bonds)
Deferred Savings:
Regular:
Stocks: 250K
Indexed Funds: 500K
Roth:
Aggressive Funds: 300K
The plan is to spend down the taxable savings for the next 10 years, then start tapping the deferred savings after that.
Next year, I plan to start buying 10-year TIPS with my regular deferred savings at 80K/year for the next 10 years. When I turn 60, I will use half of the matured monies to cover basic expenses and the other half to buy 10-year TIPS each year for the following 10 years. Basically, the idea is to be covered until I'm 80.
I also plan on either buying a SPIA or longevity insurance when I’m around 60. And depending on the stock market, I may liquidate the rental properties to accomplish this.
What do you think of this plan? Thanks again.