I've been reading these forums for the past couple of months as I've been putting together my FIRE plans.* I really appreciate the advice that I've gleaned so far.
I thought I'd post my plans here for critique, just to be sure that I'm on the right track.
My wife and I are both in our early thirties.* We have a seven-year-old son, and we plan to adopt at least one more child sometime during the next ten years.* I earned my PhD in science/engineering about a year and a half ago, and subsequently started working at my first "real" job.* My wife is a full-time stay-at-home mom who volunteers at our son's school as well as with our church.* Consequently, we're really just starting out on our road to FIRE.
Here are our details:
Savings: $50K + $38K/yr
- 403(b): $10K + $4K/yr (my contribution) + $10K/yr (company match)
- Roth IRA's: $10K + $8K/yr
- Taxable accounts: $30K + $16K/yr
The reason that we're saving so much in our Roth IRA's and taxable accounts is that we're planning on buying a house (in the Baltimore-Washington area: $ouch!) sometime in the next couple of years.* *(Although we're convinced that the housing market here is overpriced and potentially primed for a fall, we would like to get into a single-family home soon for our son's sake.)* Although buying a house will significantly deplete our accumulated savings, it shouldn't affect our annual savings rate too much over the long term as long as we don't overspend on the house.* Once we've purchased, we plan on reducing our taxable savings in order to max-out my 403(b).
Here is our planned allocation for retirement savings:
403(b)U.S. large-capVan. 500 Index Fund Inv (VFINX)10%
403(b)U.S. large-cap valueVan. Value Index Fund Inv (VIVAX)10%
403(b)U.S. small-capVan. Small-Cap Index Fund Inv (NAESX)10%
403(b)U.S. small-cap valueVan. Small-Cap Value Index (VISVX)10%
403(b)Int. large-capVan. European Stock Index Inv (VEURX)5%
403(b)Int. large-capVan. Pacific Stock Index Inv (VPACX)5%
403(b)Int. large-capVan. Emerging Mkts Stock Index (VEIEX)5%
403(b)Int. large-cap valueVan. International Value Fund (VTRIX)7.5%
403(b)Int. mid-capVan. Internatl Explorer Fund (VINEX)7.5%
403(b)REIT'sVan. REIT Index Fund Inv (VGSIX)20%
Roth IRACommoditiesPIMCO Commodity Real Return Strat (PCRIX)10%
Our house savings and emergency fund are invested in a combination of the following, chosen based partially on our tax situation:
- Van. Treasury Money Mkt Fund (VMPXX)
- Van. Short-Term Treasury Inv (VFISX)
- Van. Short-Term Invest-Gr Inv (VFSTX)
As we approach FIRE, we will build up at least five years of expenses in a short-term bond fund, but I don't see a need for that while I'm still working.
Based on these assumptions, I expect that we could FIRE in 15-20 years.* *Am I missing anything?