Hi from New York’s high taxes, 61yo.

[esposla]

This is Leslie, 61yo, married to 53yo., with 2 daughters.
We both work, gross $400k total. Small pension, $160k annuity, $1m 401ks/IRA
$50k debt. Home value $550k, mortgage $340k.

I have 3 different 401ks. Question is.: Do I move the 401k from Fidelity, $200k, to TRowe. Or the IRA from TRowe, $50k, to Fidelity? It makes sense to consolidate them. The 3rd one is ADP at work. The remaining 401 $$ is husbands.



We hope to retire 5 years.

Thank you for this forum.
Leslie

 

[Bamaman]

Leslie: I keep most of my retirement funds in one place. It's just easier for me to watch online that way. And I like Fidelity's computer system that makes it so easy to move money around--and eventually to my hometown bank when I start making withdrawals. They also can withhold taxes for me.

After 10 years retirement, I just try to keep life--and my business--simple.

 

[SumDay]

Welcome to the forum. If I were you, I'd consolidate them at Fidelity, and when you retire move everything else there. I'm a Vanguard person myself, but Fidelity would be a very close second.

 

[esposla]

Thank you. That was my feeling too, but I am a novice. I actually have access to Vanguard also (limited funds though) since the 401 is originally a vanguard 401.

I will consolidate and keep it simple.

 

[HI Bill]

This is Leslie, 61yo, married to 53yo., with 2 daughters.
We both work, gross $400k total. Small pension, $160k annuity, $1m 401ks/IRA

We hope to retire in 5 years.

Welcome! At your level of income, age, debt, and savings, is retirement in 5 years realistic? Will you be cutting your spending by 75%? Sorry, but this doesn’t seem feasible unless we are missing something really big!

 

[swakyaby]

I have IRAs at T.Rowe Price, Fidelity, and Vanguard. Since I have 12 more years before RMD start, I have left them where they are. But I do plan to consolidate the accounts prior to RMDs for simplicity.

 

[esposla]

Welcome! At your level of income, age, debt, and savings, is retirement in 5 years realistic? Will you be cutting your spending by 75%? Sorry, but this doesn’t seem feasible unless we are missing something really big!

Thank you. I appreciate the input. Since I’m the one closer to retirement, I’m starting the research for this idea. My thoughts were we don’t have enough, but I used a gov’t predictor and it was promising (EBSA). We plan to move and cut expenses, but I don’t think quite 75%. I’ll need to try using calculator here.

Thank you.

 

[VanWinkle]

Thank you. I appreciate the input. Since I’m the one closer to retirement, I’m starting the research for this idea. My thoughts were we don’t have enough, but I used a gov’t predictor and it was promising (EBSA). We plan to move and cut expenses, but I don’t think quite 75%. I’ll need to try using calculator here.

Thank you.

It is all about what you spend(budget for retirement) to find out if retirement is possible. Moving to LCOL area would be helpful as long as you can do so with family situation. Maybe a phased retirement would be more feasible.

Good luck to you,

VW

 

[MarieIG]

Hi Leslie, Welcome - from someone who has a lot of sympathy concerning those high taxes.

 

[Teacher Terry]

Hi, I think you need to know what you spend in order to answer this question. Since you are much older than your husband you should get to retire first.

 

[MarieIG]

Hi, I think you need to know what you spend in order to answer this question. Since you are [-]much[/-] older than your husband you should get to retire first.

 

[esposla]

It is all about what you spend(budget for retirement) to find out if retirement is possible. Moving to LCOL area would be helpful as long as you can do so with family situation. Maybe a phased retirement would be more feasible.



Good luck to you,



VW

Thank you, I like the phased idea since going cold turkey doesn’t really appeal to me anyway. Well need to look at our expected expenses. I’ll work on managing expenses now, especially since it’s not an area neither of us spent time on...not easy.

I appreciate the input!

 

[esposla]

I have IRAs at T.Rowe Price, Fidelity, and Vanguard. Since I have 12 more years before RMD start, I have left them where they are. But I do plan to consolidate the accounts prior to RMDs for simplicity.

Thanks, I do like TRowe, but should let it go. My dad had started using them years ago and followed him.

 

[esposla]

Hi, I think you need to know what you spend in order to answer this question. Since you are much older than your husband you should get to retire first.

Thank you, we were never too careful watching the dollar we spend. It’s important and wish Id paid some attention to it.
The daughters are both doing very well in school, so the empty nest((not there just yet as both still in college) giving me some time to pay attention to it. I enjoy working, husband does not. We both plan to work in retirement, just not 9 and 11 hours, me and him, respectively out of house M-F.

I think I should retire first too! Thanks

 

[Teacher Terry]

The past 6 years I have worked part time from home and loved it. Sadly it ended. It seemed to be the best of both worlds.

 

[cnocmmz]

Thank you, I like the phased idea since going cold turkey doesn’t really appeal to me anyway. Well need to look at our expected expenses. I’ll work on managing expenses now, especially since it’s not an area neither of us spent time on...not easy.

I appreciate the input!

I believe the only thing that worries me is the small pension? With 5-years until retirement, and 1M invested to date you would be fine if your expenses were shaved down considerably. Recommend using the FIRECALC computation provided by this site putting in different scenarios. Good luck and we will be looking forward to hearing from you as you move forward.

 

[HI Bill]

we were never too careful watching the dollar we spend.

That's what I was guessing based on your net assets vs. debt and income. You're likely spending most of your post-tax income, and saving less than $40K per year. That's why you need to evaluate how much you're spending. If you're bringing in $400K, after taxes that's around $240K; if you're saving $40K, you're spending more than $200K based on your debt. If so, you'd need to accumulate $4-5M to retain your current standard of living/spending level, even after SS. I don't mean to be harsh, but this should be a wake-up call. It's better than realizing suddenly at retirement that you'll need to cut your spending by 50%.

 

[gwraigty]

A quick glance at TRowePrice fees tells me that many are higher across the board than Fidelity charges. That alone would make Fidelity a better choice.

Disclaimer: We have accounts at Fidelity, Schwab, and Vanguard (husband's 401k). Definitely a happy customer of both Fidelity and Schwab.

 

[Bamaman]

And don't always believe when they say you can live in retirement on 75% of what you were previously making.

Healthcare's costing us a bunch. I'm a Type II diabetic and my A1C is too high. I have a prescription waiting on me at CVS, and it's a 1x per week shot--4 shots, $857. Ouch! It's cheaper to just go on a crash diet--cutting out carbs.

 

[Teacher Terry]

Ba, that’s outrageous for a weekly prescription.

 

[esposla]

Well, I’ve moved the TRowe funds today. Yay! I’ll meet with the free advisor they offer st Fidelity. Working on updating will, POA...too. Plan to pay debt this year, then increase the contribution to the 401k I have at work next year.

 

[esposla]

That's what I was guessing based on your net assets vs. debt and income. You're likely spending most of your post-tax income, and saving less than $40K per year. That's why you need to evaluate how much you're spending. If you're bringing in $400K, after taxes that's around $240K; if you're saving $40K, you're spending more than $200K based on your debt. If so, you'd need to accumulate $4-5M to retain your current standard of living/spending level, even after SS. I don't mean to be harsh, but this should be a wake-up call. It's better than realizing suddenly at retirement that you'll need to cut your spending by 50%.

Thank you... it is.....working on that debt!

 

[mrWinter]

I have had money at TRowe for a decade now and I have achieved awesome results and like the company a lot. Easy to get a real person on the phone, great website.

 

[Sunset]

OP - You need to start tracking every penny spent. It helps a lot as soon you will see where all the money goes, no guessing, knowing actual numbers. Find out where you are wasting money.

Good thing you are looking ahead, That $50K debt plus the steep mortgage is a lot of negative input. Especially the $50K debt, hopefully it's not credit card debt.

I feel your savings are too low and the total debt too high, mostly as you say due to free spending.
However, if you both retired right now, I don't think you would like to live on $40K from retirement funds, plus the small pension, and the annuity would probably pay $6K, so a rough guess of $60K total income before taxes.

 

[MarieIG]

Well, I’ve moved the TRowe funds today. Yay! I’ll meet with the free advisor they offer st Fidelity. Working on updating will, POA...too. Plan to pay debt this year, then increase the contribution to the 401k I have at work next year.[/QUOTEE

Excellent! Paying off the debt will allow you to then put that extra money into retirement and savings. It will also decrease your monthly expenses and give you a feeling of accomplishment/freedom.

Also the daughters should be (for the most part) self-sufficient by retirement.

So, but the time you retire, your expenses should be less, and your savings more. (Also, don't forget to calculate your income on the basis of one spouse. While we always hope both spouses live happily and healthy to their 110th birthday, and pass in their sleep holding hands, sometimes one goes before the other.)