NewEnglander
Recycles dryer sheets
- Joined
- Feb 9, 2020
- Messages
- 84
I’ve been lurking here for a few years so I thought it’s about time I join and contribute. I’ve learned so much from everyone here particularly from members Midpack, pb4uski, Audreyh1, imoldernu, Gumby, Senator, Alan plus many others, thank you for sharing so much with us.
I was lucky to marry a saver like myself almost 30 years ago. We managed to save 15-20% of our salaries for many years and stepped it up whenever we could.
Our stats
ages- me 58, wife 55
No kids
tIRA=$622K at Vanguard, this was a previous 401k that was rolled over to an IRA when the company was sold.
401Ks=$1.1M still at our company 401Ks, will go to Vanguard when we leave work.
Roth IRAs=$410K Vanguard
After tax= $101K various banks
HSA= $12K
Total $2.25M
AA is currently 60/40
Our house is paid off its worth $475-500K
Autos are paid off as well with low miles so a new one won’t be needed for at least 5 years. Our budget includes replacements.
No pensions,
No retirement healthcare options from our companies
Neither of our companies 401Ks allow “rule of 55” withdrawals at age 55. This is one reason why we continue to work part time.
SS will pay me $35.6K/yr at full retirement age 67, wife files at age 62 $18.4K/yr. These figures are assuming we stop working this year with no more earnings until we file. All of the SS planners I’ve used all recommend the same thing, wife files at age 62 and I file at age 70.
We both worked stressful jobs and it got to be worse the last few years especially with aging parents and the increased time we spend with them. It was harder to get all we needed to do into a 2-day weekend. I decided in 2018 to transition to part time. I kept all of my benefits but reduced my work to 3 days/week. My wife did the same a few months ago. Our stress level is now so much less we are really enjoying our lives again. We are thinking of fully pulling the plug early next year. Even with 4-5 weeks of vacation per year we use it all, we would like to take some extended trips of more than a month so it might be time to fully quit. I’ll also turn 59 in February 2021 so we can access my 401K and IRAs penalty free in August of next year.
Our expenses are $79K/yr including healthcare and budgeting for major expenses like cars/major home repairs etc. To test this, we have lived on an amount slightly less than this for the last year or so.
Firecalc gives us 100% results for a 40-year retirement on withdraws up to $114K/yr using the SS numbers above. If we reduce the SS payouts by 25% (if there is a cutback in benefits which I don’t think there will be) we get 100% success with withdrawals up to $104K/yr, so I think we have a good buffer from our actual budget requirements.
If we keep our earnings below $67K/yr we can receive $1576.00 per month subsidy for ACA insurance. We can get a bronze policy with HSA for only $12.27/month. Our $79K budget used $500/month estimated health insurance, so there’s a buffer there too.
A problem we have is we should have saved more after tax. We were so intent on saving that we maximized our 401K and Roth IRAs each year, leaving little left for after tax savings. In order to keep our earnings below 67K for the ACA subsidy we may have to pull some from the Roth IRAs each year for the 7 years I have until I reach Medicare age. My wife has 10 years until Medicare.
Using the SS amounts we should receive I figured our withdraw rate. It comes to 2.5% at $98K/year withdrawals, 3% allows withdrawals at $107K/year. Our budgeted amount $79K is only 1.4% using the actual SS numbers.
Being savers for our whole lives we are having trouble transitioning to full retirement. We have always found it hard to spend money. I think we need some encouragement from others that we are good to go?
I was lucky to marry a saver like myself almost 30 years ago. We managed to save 15-20% of our salaries for many years and stepped it up whenever we could.
Our stats
ages- me 58, wife 55
No kids
tIRA=$622K at Vanguard, this was a previous 401k that was rolled over to an IRA when the company was sold.
401Ks=$1.1M still at our company 401Ks, will go to Vanguard when we leave work.
Roth IRAs=$410K Vanguard
After tax= $101K various banks
HSA= $12K
Total $2.25M
AA is currently 60/40
Our house is paid off its worth $475-500K
Autos are paid off as well with low miles so a new one won’t be needed for at least 5 years. Our budget includes replacements.
No pensions,
No retirement healthcare options from our companies
Neither of our companies 401Ks allow “rule of 55” withdrawals at age 55. This is one reason why we continue to work part time.
SS will pay me $35.6K/yr at full retirement age 67, wife files at age 62 $18.4K/yr. These figures are assuming we stop working this year with no more earnings until we file. All of the SS planners I’ve used all recommend the same thing, wife files at age 62 and I file at age 70.
We both worked stressful jobs and it got to be worse the last few years especially with aging parents and the increased time we spend with them. It was harder to get all we needed to do into a 2-day weekend. I decided in 2018 to transition to part time. I kept all of my benefits but reduced my work to 3 days/week. My wife did the same a few months ago. Our stress level is now so much less we are really enjoying our lives again. We are thinking of fully pulling the plug early next year. Even with 4-5 weeks of vacation per year we use it all, we would like to take some extended trips of more than a month so it might be time to fully quit. I’ll also turn 59 in February 2021 so we can access my 401K and IRAs penalty free in August of next year.
Our expenses are $79K/yr including healthcare and budgeting for major expenses like cars/major home repairs etc. To test this, we have lived on an amount slightly less than this for the last year or so.
Firecalc gives us 100% results for a 40-year retirement on withdraws up to $114K/yr using the SS numbers above. If we reduce the SS payouts by 25% (if there is a cutback in benefits which I don’t think there will be) we get 100% success with withdrawals up to $104K/yr, so I think we have a good buffer from our actual budget requirements.
If we keep our earnings below $67K/yr we can receive $1576.00 per month subsidy for ACA insurance. We can get a bronze policy with HSA for only $12.27/month. Our $79K budget used $500/month estimated health insurance, so there’s a buffer there too.
A problem we have is we should have saved more after tax. We were so intent on saving that we maximized our 401K and Roth IRAs each year, leaving little left for after tax savings. In order to keep our earnings below 67K for the ACA subsidy we may have to pull some from the Roth IRAs each year for the 7 years I have until I reach Medicare age. My wife has 10 years until Medicare.
Using the SS amounts we should receive I figured our withdraw rate. It comes to 2.5% at $98K/year withdrawals, 3% allows withdrawals at $107K/year. Our budgeted amount $79K is only 1.4% using the actual SS numbers.
Being savers for our whole lives we are having trouble transitioning to full retirement. We have always found it hard to spend money. I think we need some encouragement from others that we are good to go?
