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10-17-2018, 06:43 AM
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#1
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Recycles dryer sheets
Join Date: Mar 2017
Location: Mid Town
Posts: 119
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Ready or Not
Would like to get some feedback from other FIRE members on whether or not I am ready to FIRE myself and if not how far away I might be.
Me - 58
D.W. - 52
1.5M pretax save
Small mortgage approximately 7 yrs to go 900/month
Zero debt other than the mortgage.
Expenses - tracked monthly - meticulously
Amount to 5100/month
Very modest cost of living and lifestyle.
No Megacorp health insurance so ACA
What say FIRE folks
Edit:
D.W. part time job generates 10k/yr
Me not opposed to working at something to offset any healthcare costs needed. D.W.s income more than likely be dedicated to ACA .
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10-17-2018, 06:48 AM
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#2
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Nov 2010
Location: Sarasota, FL & Vermont
Posts: 36,263
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You have more work to do. How much is your and your DW SS? How much will ACA health insurance cost you? What does FIRECalc say?
__________________
If something cannot endure laughter.... it cannot endure.
Patience is the art of concealing your impatience.
Slow and steady wins the race.
Retired Jan 2012 at age 56
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10-17-2018, 06:50 AM
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#3
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Recycles dryer sheets
Join Date: Mar 2017
Location: Mid Town
Posts: 119
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Ready or Not
Firecalc unless I am mistaken - have run it endlessly says it’s a go.
SS for me @ 62 2000/mo
Have maxed out FICA for 30+ yrs
D.W. would be half of course
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10-17-2018, 07:03 AM
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#4
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Recycles dryer sheets
Join Date: Oct 2017
Location: Orlando
Posts: 125
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Quote:
Originally Posted by augam
Expenses - tracked monthly - meticulously
Amount to 5100/month
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Does the monthly expenses of $5100 include health care? Are all of your income items taxable? Make sure you investigate what you can do to lower your MAGI - see https://www.kff.org/interactive/subsidy-calculator/
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10-17-2018, 07:14 AM
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#5
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Recycles dryer sheets
Join Date: Mar 2017
Location: Mid Town
Posts: 119
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Expenses do not reflect HC. Estimates would be 800/mo Silver plan with subsidy’s for this zip code.
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10-17-2018, 07:19 AM
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#6
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Thinks s/he gets paid by the post
Join Date: Jun 2013
Posts: 2,518
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How about income taxes? If your funds are all Pretax, you'll have to give Uncle Sam his share on the $60,000 you pull out every year.
__________________
"Luck favors the prepared mind"
Pasteur
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10-17-2018, 07:21 AM
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#7
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Moderator
Join Date: Nov 2015
Posts: 13,879
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You'll want to give some wiggle to the HC costs - and remember that's just premiums. Annual deductibles usually come with some hefty out of pocket (mine is 6k and that's not bad for my state).
Your 5100 monthly v. 1.5 is at about a 4% SWR and that's before HI, so, you are going to be in a range that would leave most of us uncomfortable.
Since all your savings appear to be pre-tax, that means you'll be paying taxes on your conversions, and I'm not sure if those are also included in your expenses?
If expenses already included HI and taxes, given your short runway till SS, I'd say you're good, but as is there are still a few questions.
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10-17-2018, 07:23 AM
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#8
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Recycles dryer sheets
Join Date: Mar 2017
Location: Mid Town
Posts: 119
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Quote:
Originally Posted by Golden sunsets
How about income taxes? If your funds are all Pretax, you'll have to give Uncle Sam his share on the $60,000 you pull out every year.
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With a 24k deduction from new tax plan taxes would be reduced accordingly.
Plan A would be to adjust income to receive subsidy for ACA.
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10-19-2018, 07:34 AM
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#9
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Recycles dryer sheets
Join Date: Mar 2017
Location: Mid Town
Posts: 119
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Ok used the Kaiser Site linked above and found Silver Plan prices - worst case scenario $1200/mo.
Then I calculated it with my youngest boys who’s freshman in college and price dropped to < 700 mo family. These are Silver Plan prices for premiums only.
Note these are estimates based on 18’ rates since 19’ rates have not been posted as of yet.
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10-19-2018, 12:15 PM
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#10
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Recycles dryer sheets
Join Date: Dec 2016
Posts: 411
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not quite there yet...
Quote:
Originally Posted by Aerides
You'll want to give some wiggle to the HC costs - and remember that's just premiums. Annual deductibles usually come with some hefty out of pocket (mine is 6k and that's not bad for my state).
Your 5100 monthly v. 1.5 is at about a 4% SWR and that's before HI, so, you are going to be in a range that would leave most of us uncomfortable.
Since all your savings appear to be pre-tax, that means you'll be paying taxes on your conversions, and I'm not sure if those are also included in your expenses?
If expenses already included HI and taxes, given your short runway till SS, I'd say you're good, but as is there are still a few questions.
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I’d say that you’d be better off if you take SS at FRA and not at 62... you don’t take the hit on SS reduction, SS isn’t taxed at most states so more income not taxed, and higher numbers for surviving spouse
...as for your plan: with 4% WR before health insurance (and especially before adding in copay/max OOP costs) your plan has a reasonably high chance for failure _____danger, will robinson
(60k/year doesn’t seem unreasonable, though. rather than just have spouse bring in 10k from PT, just suck it up and stay full time for a couple more years and build up more. At 60, put two to three years into CD ladder for expenses for those years....then see what your remaining portfolio kicks off at about 3.5%. your numbers are low enough that your medicare costs won’t be at the premium rates, so no issue there. )
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10-19-2018, 02:30 PM
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#11
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Jan 2018
Location: Tampa
Posts: 11,226
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Is your pre tax in TIRA or 401k? If 401k, do you have access to it at 58 yo?
If TIRA, where would the withdrawals be until 59.5?
__________________
TGIM
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10-20-2018, 09:23 AM
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#12
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Thinks s/he gets paid by the post
Join Date: Aug 2017
Location: Champaign
Posts: 4,689
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Only a suggestion: Examine bronze plans in ACA. Max OOP is key. Our silver plan premiums were > $500/month for 2017. Lowest bronze plan $7.95/month with $6000 deductible/OOP max. We opened an HSI as this is a qualified high deductible plan. Saved approx $7000 so far this year. That includes co-pays because we paid only the insurance reduced cost for DR visits and yearly blood tests. For instance with Silver Plan in 2017, a co pay for a DR visit, $50. The insurance reduced cost was $30-$40 in 2018. My point, look closely at the plans. In 2018 we had an insurance broker help us and she pointed out the benefits to a high deductible plan.
__________________
"Do not go where the path may lead, go instead where there is no path and leave a trail."
Ralph Waldo Emerson
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10-20-2018, 04:33 PM
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#13
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Recycles dryer sheets
Join Date: Mar 2017
Location: Mid Town
Posts: 119
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Quote:
Originally Posted by Dtail
Is your pre tax in TIRA or 401k? If 401k, do you have access to it at 58 yo?
If TIRA, where would the withdrawals be until 59.5?
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After 55 you can access your 401k from employer plan without penalty.
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10-20-2018, 04:38 PM
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#14
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Recycles dryer sheets
Join Date: Mar 2017
Location: Mid Town
Posts: 119
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Quote:
Originally Posted by Rianne
Only a suggestion: Examine bronze plans in ACA. Max OOP is key. Our silver plan premiums were > $500/month for 2017. Lowest bronze plan $7.95/month with $6000 deductible/OOP max. We opened an HSI as this is a qualified high deductible plan. Saved approx $7000 so far this year. That includes co-pays because we paid only the insurance reduced cost for DR visits and yearly blood tests. For instance with Silver Plan in 2017, a co pay for a DR visit, $50. The insurance reduced cost was $30-$40 in 2018. My point, look closely at the plans. In 2018 we had an insurance broker help us and she pointed out the benefits to a high deductible plan.
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Once new rates are posted for 19' I will research the Bronze Plans as well.
Using a broker is an excellent idea.
Thanks
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