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51 and looking to retire in March
Old 01-02-2021, 04:57 PM   #1
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51 and looking to retire in March

Hello all! Been a lurker for a bit and wanted to introduce myself. I discovered this forum about a year ago and Im learning a lot and would value your feedback. My wife and I would like to retire in March and would like your opinion on if its feasible. I'm currently 51 and wife 52. 2 kids living on their own.

Current assets -
Retirement accounts: $1.7M (98% stock, 2% bonds)
Taxable account: 805k (73% stock, 27% bonds)

HSA: $33k (40% stock, 60% bonds)
Cash: $35k

Overall we are at ~ $2.5M, 90% stock, 10% bonds

House currently valued around $263,000 and is paid off.

Expenses Living expenses $57,000; taxes $6,000; HC $16,000 Total expenses $79,000
I have put all this into the FIRE calc and it shows a 100% chance of success assuming we live to age 85+. Please let me know your feedback and if Im missing anything. Thanks!
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Old 01-02-2021, 05:10 PM   #2
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I'm far from an expert but the way it looks you are 32X expenses. That doesn't include any growth/gains from your portfolio through the years or SS. I also have faith in what FIRECalc tells us.

I would say you should be fine if expenses are correct. Good Luck.
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Old 01-02-2021, 05:12 PM   #3
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Quote:
Originally Posted by mtb1 View Post
Hello all! Been a lurker for a bit and wanted to introduce myself. I discovered this forum about a year ago and Im learning a lot and would value your feedback. My wife and I would like to retire in March and would like your opinion on if its feasible. I'm currently 51 and wife 52. 2 kids living on their own.

Current assets -
Retirement accounts: $1.7M (98% stock, 2% bonds)
Taxable account: 805k (73% stock, 27% bonds)

HSA: $33k (40% stock, 60% bonds)
Cash: $35k

Overall we are at ~ $2.5M, 90% stock, 10% bonds

House currently valued around $263,000 and is paid off.

Expenses Living expenses $57,000; taxes $6,000; HC $16,000 Total expenses $79,000
I have put all this into the FIRE calc and it shows a 100% chance of success assuming we live to age 85+. Please let me know your feedback and if Im missing anything. Thanks!

Your numbers look good to me. approx 3.2% WR.

Your WR has to last 11-18 years depending when you draw SS (I assume no pensions)and then it may drop to a much lower #which would be a bonus.

Maybe you can work on those HC costs after retiring and possibly manage your MAGI to get some ACA reductions?
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Old 01-02-2021, 05:50 PM   #4
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Welcome aboard.

It looks to me like you are doing great! Congrats.
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Old 01-02-2021, 06:21 PM   #5
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You need to consider two things. One, do you have enough for life... you're golden there with a 3.2% WR before even considering SS or any pensions. Two, do you have enough that you can access penalty free before 59 1/2... next 8 1/2 years... $80k a year * 8 1/2 years is $680k and you have $840 available between cash and taxable accounts so you are all set there too.

Are your retirement accounts tax-deferred (traditional 401k, 403b, tIRA and the like) or tax-free (Roth 401k, IRA, et al)? In any event you probably would be best off to sell the bonds in the taxable account and buy stocks and the inverse in your retirement accounts. Holding stocks in a tax-deferred retirement account effectively converts tax preferenced qualified dividends and LTCG into higer taxed ordinary income so it is preferable not to hold stock in tax deferred accounts unless you have no other choice.

Also, once you retire you will likely be in a low tax bracket... which is an ideal time to do low tax cost Roth conversions before SS and any pensions push you into a higher tax bracket.
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Old 01-02-2021, 06:48 PM   #6
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You look fine, and your HC budget seems solid for your age. Should account for premiums + deductibles. We're the same age and keep a HD/HSA plan to help manage taxes under the ACA caps.
Just be sure that $57k isn't just survival, bill paying expenses, but having fun too. All in, living how you want.
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Old 01-03-2021, 05:48 AM   #7
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Thanks for the feedback! This is a great community and source of information!
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Old 01-03-2021, 07:17 AM   #8
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Originally Posted by mtb1 View Post
Thanks for the feedback! This is a great community and source of information!


In my opinion you should be fine. That being said;
1. You guys are young; but, think about LTC and the cost that will bring.
2. For me, not having enough guaranteed income would not let me sleep at night. Anything in the stock market is not guaranteed, so your allocation will be key in the future.
Good luck and get everything in order prior to walking out the door. -
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Old 01-03-2021, 08:10 AM   #9
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Hello MTB1,
I am almost in the same situation as you describe, same age, same NW, same spending, same house. Only apparent difference is I don't have a spouse and my youngest child is still in HS.

We are ready to sail on into FIRE.

However, I will still w**k two more years to accumulate an extra cushion to make me sleep better. Perceived risks that I want to consider are to be able minimally support the children in case of some catastrophe in their lives or a major set-back in the market during the firsts few years of my ER.

After seeing what happened to the market early this year, I would not be comfortable to retire with your high % in stock and only $35k in cash. Maybe work a year longer and maintain savings in cash to not have to be forced to sell in a future dip?
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Old 01-03-2021, 10:10 AM   #10
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You should be fine. If your expenses go up to $100,000, be sure to claim social security at 62 yrs old.
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Old 01-03-2021, 12:01 PM   #11
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If your expenses go up to $100,000, be sure to claim social security at 62 yrs old.
Why do you advise this?
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Old 01-03-2021, 02:48 PM   #12
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I always use age 95 in firecalc. There is a solid chance that at least one of you will make it into their 90’s.
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