rheumdoc1977
Confused about dryer sheets
- Joined
- Apr 28, 2008
- Messages
- 8
I am just starting on the path to early retirement. While I am looking over the posts in the past, I was wondering if I could get some advice on my specific situation.
Age: 30
Married, no kids (plan on 2), DW age: 28
Goals: own home, retire in 20 years
Current savings: 6 months emergency funds, essentially zero retirement funds (just got out of medical school, now with first "real job")
Current income and savings rate: $200,000 combined gross, 20% gross per year
Estimated living expenses: 60,000/yr before taxes (I arrived at this by taking our current take home after taxes/savings minus mortgage (which I hope to no longer have), minus DW's pension. I have not factored in any social security or inheritance.
So far, this is what I have done in estimating what I will have to do:
1. I estimated that to generate 60K after taxes, I would need about 75K before taxes. With inflation, this would be the same as 150K/year in 20 years.
2. I am comfortable with a 5% withdrawal rate. 150K times 20 is 3 million.
3. In excel, if I save 40K a year (20% gross) for twenty years, I would have to earn 12%/year to make my goal. This seems impossible.
4. Disappointment set in, and so I drowned my sorrows in a coke float.
Questions:
1. Am I missing anything here, or do I just need to save tons more? Has anybody calculated what percent of gross one needs to save to retire in 20 years starting with nothing?
2. Currently I am invested in the following way:
20% intermediate bond fund
56% Total US Stock Market index fund
24% Total international Stock Market index fund
Any reason to change this? Should I have more/less in bondS 9I have a moderate tolerance for risk)? Specifically, should I invest some money in REITS at the expense of my Total US Stock allocation?
Thank you for any suggestions.
Age: 30
Married, no kids (plan on 2), DW age: 28
Goals: own home, retire in 20 years
Current savings: 6 months emergency funds, essentially zero retirement funds (just got out of medical school, now with first "real job")
Current income and savings rate: $200,000 combined gross, 20% gross per year
Estimated living expenses: 60,000/yr before taxes (I arrived at this by taking our current take home after taxes/savings minus mortgage (which I hope to no longer have), minus DW's pension. I have not factored in any social security or inheritance.
So far, this is what I have done in estimating what I will have to do:
1. I estimated that to generate 60K after taxes, I would need about 75K before taxes. With inflation, this would be the same as 150K/year in 20 years.
2. I am comfortable with a 5% withdrawal rate. 150K times 20 is 3 million.
3. In excel, if I save 40K a year (20% gross) for twenty years, I would have to earn 12%/year to make my goal. This seems impossible.
4. Disappointment set in, and so I drowned my sorrows in a coke float.
Questions:
1. Am I missing anything here, or do I just need to save tons more? Has anybody calculated what percent of gross one needs to save to retire in 20 years starting with nothing?
2. Currently I am invested in the following way:
20% intermediate bond fund
56% Total US Stock Market index fund
24% Total international Stock Market index fund
Any reason to change this? Should I have more/less in bondS 9I have a moderate tolerance for risk)? Specifically, should I invest some money in REITS at the expense of my Total US Stock allocation?
Thank you for any suggestions.