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Glidepath established (hopefully), now what?
Old 02-21-2015, 10:53 AM   #1
Dryer sheet wannabe
Join Date: Mar 2011
Location: Windsor
Posts: 11
Glidepath established (hopefully), now what?

Hi, everyone! Long time lurker, first time poster! I have learned so much here thank you all! A quick introduction and a question: What am I missing? My ten year countdown has begun and I have to get this right. I dont think I have time for a reboot on this.

Some details.
Age 49.5 and DW is 43 (she will retire 6 yrs after me). One in college with zero expenses for us (hurray!) Very stable jobs, but the only slightly strange thing is that DWs employment is at a non-SS institution (mine has SS).

Current 401(k) and 457(b): $950k, with $40k added each year. We will have $450k in after tax cash in 10 years (plain savings acct), with separate cash accounts to replace car and major expenses when we start this new chapter.

My pre-tax AAs trajectory is moving toward 70/30 by age 60 (with the notion that there will also be cash in the bank, albeit perhaps too much, for our safety cushion).
Current household income: $250k
Our expected expenses will be $70k and no mortgage.
When I pull the plug, I will get 3 years of healthcare from employer (not COBRA), then I will go on DWs plan for 2 years until I am 65. What to do about DWs healthcare between 60-65? No idea (which would clearly add to our expenses).

Currently 1 rental property (no mortgage) with modest cash flow. Expect to sell it in 10 years ($160k) and invest the proceeds or just use for added income ($12k/yr).
1 vacation home and one permanent home. In five years our home equity will eclipse mortgage on vacation home and we will sell, pay off vacation home, and move there until (and perhaps during) retirement.

I plan to take SS at age 67 ($30k)

DW has separate, and smaller, 457(b) that well use as simply a bonus (but should still be near $500k when she is done).

Firecalc says Im fine, but what am I missing? What should I change? I realize that the wheels could fall off at any time over the next decade, but Im looking at all of these numbers as realistically/conservatively as possible. I do think my tax situation is a disaster, but there seems to be too many moving parts right now to get a clear picture.

Thank you for any insights you might offer!

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Old 02-21-2015, 04:13 PM   #2
Recycles dryer sheets
Join Date: May 2013
Location: Toronto
Posts: 219
Why will you have 450k in plain cash? That seems like a big pile to be sitting there earning nothing. Aside from that I'd say you need to get a better idea of your healthcare costs.

Overall seems fine, if Firecalc says you're good then who am I to differ.

Just make sure you understand your expenses for sure, so that you're working off good data.

Spudd is offline   Reply With Quote
Old 02-21-2015, 09:52 PM   #3
Full time employment: Posting here.
Join Date: Jul 2014
Posts: 774
You seem to have done a very good job of planning and are on a good path. One question I have is if DW will really want to continue working for 6 years once you're retired, especially if you're on solid financial footing. Although that's the plan now, you may want to consider the impact if she changes her mind once you retire.
Katiek is offline   Reply With Quote
Old 02-22-2015, 08:40 AM   #4
Dryer sheet wannabe
Join Date: Mar 2011
Location: Windsor
Posts: 11
Thanks Spudd and Katiek.

Spudd, you are right -- I need to find something to do with my cash. The bond portion of my AA will be taken care of inside my 457(b), so I'm honesty not certain of the best location for cash. The cash comes from rental profit (I can't take any advantage of passive losses, at least not now), and I have maxed out my pre-tax retirement contributions (although being 50 this year I can take advantage of the catch up provision). I've always been a bit of a "earmmarking" funds investor, so finding a place and a purpose is at the top of my list (maybe future healthcare?). Laddering CDs is one possibility....

And Katiek, yes, I definitely think about what would happen should DW want to pull the plug when I do. What will healthcare look like in a decade? It could be very costly or not-so-much. Our health is good and our professions don't require heavy lifting, so being able to continue after my self-imposed deadline is always a possibility. There still seems to be too many moving parts.

Thank you both for your thoughts.
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