FedRetired50
Recycles dryer sheets
Welcome. I like your "2 buckets" line of thought, since that's how I've been thinking, too. How to make it through my 50s, then what happens after 59 1/2.
Speaking of 59 1/2, someone here briefly mentioned 72t, also known as SEPP (substantially equal periodic payments). That's going to be part of my living expense income starting soon so I've done a lot of research on that. It is something to keep in mind if you find you need the additional income. Based on your $1.4 mil balance and your age, you could withdraw $83,696/yr. as of today without the 10% early-withdrawal penalty. I can give you more info if you want it.
I'll also offer advice on not delaying Social Security (former SS employee here, not representing any viewpoint of SSA). The lifetime payouts are based on actuarial tables on expected longevity, so ignoring things like future value of money, the payout is the same. Contrary to the magic 8% year-over-year increase you often read about. If you wait to 67 but get hit by a bus at 65, you get nothing. If you wait to 70 and get hit by a bus at 72, you get less than you could have. Also by waiting, you push your break-even point much farther out, making a bet that you will beat that mark, but you may not (refer to bus @ 72). If you do need the money but wait, you are then burning inheritable assets instead of using SS and preserving your other assets for kids, etc. So, I always advise to take it at 62 and invest it if you don't need it. If you suddenly do need it, you have a new nest egg to tap. If you don't, it will sit there and grow.
Speaking of 59 1/2, someone here briefly mentioned 72t, also known as SEPP (substantially equal periodic payments). That's going to be part of my living expense income starting soon so I've done a lot of research on that. It is something to keep in mind if you find you need the additional income. Based on your $1.4 mil balance and your age, you could withdraw $83,696/yr. as of today without the 10% early-withdrawal penalty. I can give you more info if you want it.
I'll also offer advice on not delaying Social Security (former SS employee here, not representing any viewpoint of SSA). The lifetime payouts are based on actuarial tables on expected longevity, so ignoring things like future value of money, the payout is the same. Contrary to the magic 8% year-over-year increase you often read about. If you wait to 67 but get hit by a bus at 65, you get nothing. If you wait to 70 and get hit by a bus at 72, you get less than you could have. Also by waiting, you push your break-even point much farther out, making a bet that you will beat that mark, but you may not (refer to bus @ 72). If you do need the money but wait, you are then burning inheritable assets instead of using SS and preserving your other assets for kids, etc. So, I always advise to take it at 62 and invest it if you don't need it. If you suddenly do need it, you have a new nest egg to tap. If you don't, it will sit there and grow.