Join Early Retirement Today
Reply
 
Thread Tools Display Modes
Old 11-07-2009, 08:20 PM   #21
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
Katsmeow's Avatar
 
Join Date: Jul 2009
Posts: 5,307
Quote:
Originally Posted by smjsl View Post
Here is a review of your items and how you could potentially save some money (obviously what I think is reasonable is different from others, but still even figures I suggest are sometimes way more than what others might have spent, esp. if they plan on $40k/year).
These are the expenses we would have a year from now if we sold our house that we own now and downsized to something 2000 to 2500 square feet.

Quote:
Auto Fuel - $150 => $100 (5miles*$3perGallon/20miles-a-gallon*30days=$22.5... quadruple it just in case and it's still less than $100)
Currently we spend about $400 a month on fuel as we live along way from both my work and DH's work. The above is based upon living close to his work but then I would have to drive a long way to my work -- our workplaces are far apart.


Quote:
Toll Road - $50 => $10 - can you move somewhere to avoid this $600 yearly expense?
We plan to move somewhere to avoid the current $3000 a year expense on this (we are spending $250 a month now). Once I no longer work we would avoid this entirely but while either DH or I work we will spend some on this to avoid to some very long traffic delays

Quote:
Children/school related - $1600 => how much will tuitions be?
Tuition and school related expenses are about 80% of this.

Quote:
Healthcare - $550 => based on what? I found that on average, people actually are planning 12k/year for all medical related expenses just for 2 people... So, compared to others, this is quite low actually!
During retirement I have this expense at much higher. Right now we have good insurance through DH's employer.

Quote:
Household supplies/repairs/maintenance/yard - $300 (total guesstimate) => I assume this includes all the large jobs like roof replacement every 20 years or so, ACC replacement every so often, siding painting/replacement, paint jobs, etc?
This is meant to include both regular, irregular and savings for occasional expenses but is largely a guess particularly since we don't know exactly what the situation will be where we move (will it be brick, will be a newer home or older home, etc). Current expenses are much higher though

Quote:
Ins Auto - $400 => don't know what to say; I am more used to ~$700/YEAR for 2 cars, 2 people
Our insurance would be much less if we had no kids on the policy. Teenage boys really add to the cost.

Quote:
Ins House - $100 (guesstimate) => prices up north are ~$500/YEAR for avg house about 30-40 years old.
Two years ago I was paying $7000 a year due to having a pool and being more than 5 miles from a fire station. That was with a $10k a year deductible by the way. That has now gotten down to $2200 (new fire station was built closer to us). Having said that, many many people have inadequate homeowner's insurance. Most people have no clue about the different types of coverage available and don't understand, for example, the difference between an all risk and a named perils policy. Many people think that all insurance policies are the same in what they cover. They are wrong.

<i>Ins Umbrella - $100 (guesstimate) => $0... what is this for? Presumably you have a lot of money saved up and your kids are already teenagers, soon to be adults - what does this cover exactly?</I>

This is so that we won't be bankrupted if we get sued. We have a pool. What if someone wanders into our property (despite our fences) and drowns? We drive cars. What if we have an auto accident and someone is terribly injured or dies? You just never know. Umbrella insurance protects you against the possibility of a judgment that would exceed your homeowner's liability coverage or your auto liability.

Quote:
Computers/electronic/software - $200 (computers are getting long in tooth) => make this $20, or are you buying a new computer every other month?
I replace my personal computer about every few years, same for dh. I admit this is an indulgence area for me and I like high end computers. This category also includes things like software (Windows 7 for example), any peripherals (new printer, mouse, keyboard, headphones, UPS, whatever). Truthfully $200 a month isn't enough for the kind of computers I like (my current computer is almost 3 years old and cost over $4000, the one I really wanted was $7000). Now I won't be getting those but it isn't realistic for me to think we will spend less than $200 a month on this category.

Quote:
Clothing/cleaning - $100 - this includes maid service?
Cleaning = dry cleaning for my work clothes



Quote:
Garbage - $37 => do people pay for garbage everywhere in Texas? just curious
We live in a semi-rural area with no public garbage pick up so this private service. If we move and have city services you pay for garbage usually as part of your water and sewer bill
Katsmeow is offline   Reply With Quote
Join the #1 Early Retirement and Financial Independence Forum Today - It's Totally Free!

Are you planning to be financially independent as early as possible so you can live life on your own terms? Discuss successful investing strategies, asset allocation models, tax strategies and other related topics in our online forum community. Our members range from young folks just starting their journey to financial independence, military retirees and even multimillionaires. No matter where you fit in you'll find that Early-Retirement.org is a great community to join. Best of all it's totally FREE!

You are currently viewing our boards as a guest so you have limited access to our community. Please take the time to register and you will gain a lot of great new features including; the ability to participate in discussions, network with our members, see fewer ads, upload photographs, create a retirement blog, send private messages and so much, much more!

Old 11-07-2009, 08:27 PM   #22
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
Katsmeow's Avatar
 
Join Date: Jul 2009
Posts: 5,307
Quote:
So with the 700k and hopefully SS of $40k for both of you . You are looking at a retirement income of $68 K and you will have a mortgage . Seems a little (no a lot tight ) to me . I 'd start saving as aggressively as you can for the next few years .
A little more. We have about 350k in 401k now so that with the 700k is 1.05 million and we should max out 401k for next 2 years. Our SS is higher than that. DH will take at his full retirement of 66. I'll probably take at 62.

Also we plan to not have a mortgage during retirement. That sort of depends on how much extra we can save over next couple of years and really depends on selling this house.

Oh and when kids are gone the projected budget goes down to about $70k.
Katsmeow is offline   Reply With Quote
Old 11-08-2009, 01:46 AM   #23
Thinks s/he gets paid by the post
Rambler's Avatar
 
Join Date: Jul 2007
Posts: 2,487
We have 3 levels of projections. Lowest is $88k per year. We also have 2 acres and 4500 ft house, in California. Would be hard to get much lower than that if we stay in the big house...and it is paid off. Next level is about $98k per year and includes extra gas, insurance, maintenance and depreciation on a smaller RV. Next level up is about $110k and includes a little bigger RV and a little more spending money. Bottom line though is that we could get by on less if we had a smaller home and smaller property, and no RV to go along with it. My guess is $60-75k would be enough for us if we decided to keep our older home at 1700 sq ft, and sell the newer McMansion (very unlikely...ask the DW...).

edit to add: figures include property tax but not income tax since that will vary by state and an individual's personal tax strategies.

R
__________________
Find Joy in the Journey...
Rambler is offline   Reply With Quote
Old 11-08-2009, 07:21 AM   #24
Moderator Emeritus
W2R's Avatar
 
Join Date: Jan 2007
Location: New Orleans
Posts: 47,467
Quote:
Originally Posted by Katsmeow View Post
I confess that DH and I do not have a lifetime of frugality behind us. Some of that is related to child related expenses, part of it to poor decisions. Over the past several years we have actually lived quite frugally as a large part of our income has gone to debt repayment or child related expenses (kids are all teenagers, two to soon be in inexpensive college). With kids going to college, we do not need the large house we have and plan to move to a much smaller house.
When the kids are out of college, your kid-related expenses should (will?) shrink to the hundreds of dollars, instead of thousands of dollars.

Quote:
However when I project expenses I find it difficult to get below $90k in such a house even with DH working (our medical would be low since I would be on his plan but we would have college expenses of about $12k a year). If I project retirement for both and no kids I get about $70k expenses not including medical (DH would have retiree medical but I would not).
Medical is a very difficult problem these days. I will have lifetime medical due to being a federal employee so other than premiums, co-pays, and deductibles, that is not a factor in my retirement budget. I think it is extremely difficult to impossible to retire before one's kids get out of college, unless you have already put that money aside.

Quote:
So I want to go over some expenses and get some feel for what I'm missing on how expenses can be so low for some.
I am a single person in a 1558 square foot house with one car and no desire for a bigger house or two cars. When you are retired, will you really need two cars? Will you really need 2500 square feet?

Quote:
Home Repairs and Maintenance - $6278. That number doesn't include the $8000 in landscaping/tree removal costs post Hurricane Ike or the $1450 for tree branch removal when another big storm came through.
Hurricane damage is expensive. It cost me $900 to have a medium sized tree removed that was leaning on my roof after Katrina. I waited until June of the following year since prices were shockingly high right after Katrina. Another tree, this one very large, was weakened severely by Katrina and big branches fell during Hurricane Gustav knocking down my neighbor's fence. He wouldn't accept reimbusement (great neighbor!) but I had the tree removed as a courtesy after that: $1500. I don't have 2 acres like you - - just a 50'x100' lot. I think that my house will be more sellable without the beautiful trees, since most here are pretty leery of trees due to hurricanes.

Who retires in a huge house with a fleet of cars, anyway? That's not what life is all about for most people, especially after getting past the "Gee, I'm a success!" part of life. I think that if you re-think these expenses, then when your children are self-sufficient you will be spending a lot less.
__________________
Already we are boldly launched upon the deep; but soon we shall be lost in its unshored, harbourless immensities. - - H. Melville, 1851.

Happily retired since 2009, at age 61. Best years of my life by far!
W2R is offline   Reply With Quote
Old 11-08-2009, 07:55 AM   #25
Thinks s/he gets paid by the post
 
Join Date: May 2005
Location: Texas
Posts: 1,038
With Social security and your assets you can generate maybe about 85K. So you will need to get your costs to below about 70K. Taxes you know.

I make about a 3d your house hold income and have more in my 401K and am about a decade younger than your DH. Honestly you have made a lot of money and spent most of it. You cant use your past life style to support you in retirement. Better downsize now. That will help you save during your remaining years and not force a much more painful adjustment later.

My projected retirement requirement is about 60K. No maids, no trips, house paid for.
__________________
In theory, theory and practice are the same. In practice, they are not.
Lazarus is offline   Reply With Quote
Old 11-08-2009, 07:57 AM   #26
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
Midpack's Avatar
 
Join Date: Jan 2008
Location: NC
Posts: 21,148
We live on about $70K month (after taxes), but we could and will drop expenses when we retire. Some of your monthly expenses look outrageous to me, but we all have different priorities. And with many of the suggestions you've gotten, you simply defend what you choose to spend. Instead of guessing where you can save, have you Googled household budgets or expenses? You can find all sorts of averages online, which will show you where your spending differs from the mainstream. If I were you, I'd compare to several of them, and then it's for you to reconcile the differences.
__________________
No one agrees with other people's opinions; they merely agree with their own opinions -- expressed by somebody else. Sydney Tremayne
Retired Jun 2011 at age 57

Target AA: 50% equity funds / 45% bonds / 5% cash
Target WR: Approx 1.5% Approx 20% SI (secure income, SS only)
Midpack is offline   Reply With Quote
Old 11-08-2009, 08:04 AM   #27
Full time employment: Posting here.
Delawaredave5's Avatar
 
Join Date: Dec 2004
Posts: 699
Your investments are $400K total ? Old rule-of-thumb I've read is (Age) x (Annual Salary) / 10 ought to be a ballpark net worth. So 50 years x 300k / 10 = $1.5mm.

What kind of house equity do you have total ?

You know this already, but high expense items to me are: house, pets, gifts, and computers.

Given your "historical lifestyle", I wouldn't try to force a budget much less than $80k/year.

I'd consider 62 year old hubby retiring and have younger, higher paid spouse keep working and try to put away $100k / year for next 7 years and downsize house.

That ought to get you to $2mm and $80k annual withdrawl rate.
Delawaredave5 is offline   Reply With Quote
Old 11-08-2009, 08:19 AM   #28
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
Midpack's Avatar
 
Join Date: Jan 2008
Location: NC
Posts: 21,148
Quote:
Originally Posted by Delawaredave5 View Post
Your investments are $400K total ? Old rule-of-thumb I've read is (Age) x (Annual Salary) / 10 ought to be a ballpark net worth. So 50 years x 300k / 10 = $1.5mm.
Sorry for the hijack, but thanks for the positive reinforcement, we're way ahead of that rule-of-thumb.
__________________
No one agrees with other people's opinions; they merely agree with their own opinions -- expressed by somebody else. Sydney Tremayne
Retired Jun 2011 at age 57

Target AA: 50% equity funds / 45% bonds / 5% cash
Target WR: Approx 1.5% Approx 20% SI (secure income, SS only)
Midpack is offline   Reply With Quote
Old 11-08-2009, 08:38 AM   #29
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
 
Join Date: Jun 2005
Posts: 10,252
Quote:
Originally Posted by midpack
We live on about $70K month (after taxes), but ....
I wouldn't have a problem with spending at that rate.

Quote:
Originally Posted by delawaredave5
I'd consider 62 year old hubby retiring and have younger, higher paid spouse keep working and try to put away $100k / year for next 7 years and downsize house.
I like this idea as well. Having two spouses -- an older retired one and a younger, higher paid one -- sounds ideal to me.
LOL! is offline   Reply With Quote
Old 11-08-2009, 09:23 AM   #30
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
Katsmeow's Avatar
 
Join Date: Jul 2009
Posts: 5,307
Quote:
Originally Posted by Midpack View Post
Some of your monthly expenses look outrageous to me, but we all have different priorities. And with many of the suggestions you've gotten, you simply defend what you choose to spend. Instead of guessing where you can save, have you Googled household budgets or expenses?
It isn't so much that I defend it as answer questions to explain it. Some of it I would love to get rid of. When we bought this house we severely underestimated the cost of maintenance/repair. We had never lived on anything other than a regular lot in a regular subdivision. We moved from that to a house on 2 acres with well and septic and over 100 large trees. So the maintenance and repair costs have been what they have been. But, I don't want them in future, hence, part of the reason we want to move.

As far as researching expenses and getting info...well, that was sort of the point of this whole thread. We have googled it. I spent a great deal of time researching food costs and found out that my budgeted goal was woefully inadequate. Some stuff...well it doesn't help to know what the average electric bill is of, say, a 1500 square foot house when that isn't the house that I have.
Katsmeow is offline   Reply With Quote
Old 11-08-2009, 09:42 AM   #31
Thinks s/he gets paid by the post
 
Join Date: Jul 2007
Location: St. Louis
Posts: 1,563
If it were me I would take the size of my house divided by 1500 square feet that would give you a ballpark number for your utilities.

Quote:
Originally Posted by Katsmeow View Post
It isn't so much that I defend it as answer questions to explain it. Some of it I would love to get rid of. When we bought this house we severely underestimated the cost of maintenance/repair. We had never lived on anything other than a regular lot in a regular subdivision. We moved from that to a house on 2 acres with well and septic and over 100 large trees. So the maintenance and repair costs have been what they have been. But, I don't want them in future, hence, part of the reason we want to move.

As far as researching expenses and getting info...well, that was sort of the point of this whole thread. We have googled it. I spent a great deal of time researching food costs and found out that my budgeted goal was woefully inadequate. Some stuff...well it doesn't help to know what the average electric bill is of, say, a 1500 square foot house when that isn't the house that I have.
FANOFJESUS is offline   Reply With Quote
Old 11-08-2009, 09:55 AM   #32
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
Katsmeow's Avatar
 
Join Date: Jul 2009
Posts: 5,307
Quote:
Originally Posted by Delawaredave5 View Post
Your investments are $400K total ? Old rule-of-thumb I've read is (Age) x (Annual Salary) / 10 ought to be a ballpark net worth. So 50 years x 300k / 10 = $1.5mm.

What kind of house equity do you have total ?

You know this already, but high expense items to me are: house, pets, gifts, and computers.

Given your "historical lifestyle", I wouldn't try to force a budget much less than $80k/year.

I'd consider 62 year old hubby retiring and have younger, higher paid spouse keep working and try to put away $100k / year for next 7 years and downsize house.

That ought to get you to $2mm and $80k annual withdrawl rate.
DH and I didn't always have those salaries. DH raised a family with 3 kids before we married and had a non-working spouse in prior marriage. When we married (I was in my late 30s) he had kids in college and had no non-retirement savings. We married and have 3 children all of which turned out to some needs which resujlted in some not typical expenses that were necessary but extremely expensive. Having said that for several years we did not adjust our lifestyle to those expenses. We should have but we didn't. As a result we were severely in debt. The high child related expenses weren't our fault. The failure to adjust our lifestyle to deal with them was. That was entirely our responsibility and entirely our failure. We have spent the past 4 years getting out from under that and within the next couple of months will have gone from having around $300k in non-mortgage debt to having zero.

DH and I both have always had the mindset that in retirement we would live much more modestly and would not have the kind of house we have now. The pets/computers are important to us and we would give up house, travel, dining out, and many other things to afford them.

I guess I could work for the next 7 years but I have two problems with it. First, I don't see that I need to. We have $350k in 401(k) If, say, I worked 2 more years and we maxed it out and the returns were zero, in 2 years that is about $430k. DH would get about $700k from his lump sum. So that is $1,130,000. Using 4% that is roughly $45k a year. His SS at 66 is estimated at $27576. If I work until 62 and take it, my estimated would be $22,008. If I retired in 2 years (the earliest possiblity that I see) mine would be $20664 at 62.

If DH is retired and I am not yet 62, then income (without increasing withdrawal rate above 4% until I am 62) is $72576. Once I hit 62, then that increases to $93,240.

I don't think I need to work another 7 years to pile up $2 million. I probably will work more than 2 more years although I am seriously considering requesting in a year or so a reduction in work hours for a reduction in salary (probably in the 20% to 30% range).

DH doesn't hate his job. He receives excellent benefits and his work is very low stress. If they offered him a good early retirement package (which has occasionally happened where he works) he would take it but he is OK with working to 65 or 66.

My job is long hours and extremely high stress. If I had to keep up for the next 7 years my current work schedule and stress I would shoot myself. Retiring entirely in 2 years probably is not in the cards, but I could see myself significantly changing my work situation where my income was much less. Ideally the situation would be, however, that we could reduce our expenses enough by selling this house and moving that we could live solely on DH's income so that we would have that option.

I want to be clear that in talking about historical expenses or projected expenses I am not expressing unwillingness to change them to get them lower. The point of this thread is to gather ideas and get a feel for others have done. For example, DH and I talked yesterday about reducing the cable bill and how to do that. We worked out how to reduce it by $100 a month. We can reduce our cell phone bill $20 a month by dropping our plan from 2100 minutes a month (4 people using plan) to 700 minutes.

We can reduce dining out easily but reducing computer/pets would be only if we were in dire straits since that is important to us.

FWIW, doing a projected budget for when kids are out of the house is about $60 to $70k a year depending on some variables.
Katsmeow is offline   Reply With Quote
Old 11-08-2009, 09:56 AM   #33
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
Katsmeow's Avatar
 
Join Date: Jul 2009
Posts: 5,307
Quote:
Originally Posted by rec7 View Post
If it were me I would take the size of my house divided by 1500 square feet that would give you a ballpark number for your utilities.
Well we don't come out that badly on that particularly given that our house is all electric with no natural gas.
Katsmeow is offline   Reply With Quote
Old 11-08-2009, 11:16 AM   #34
Thinks s/he gets paid by the post
 
Join Date: Jul 2007
Location: St. Louis
Posts: 1,563
The average family in the US makes about 50k a year. It should be easy to be average in Texas for 50k a year. Here are some 2007 numbers for Texas.

http://www.ers.usda.gov/data/unemplo...ist2.asp?ST=TX
FANOFJESUS is offline   Reply With Quote
Old 11-08-2009, 11:26 AM   #35
Full time employment: Posting here.
Delawaredave5's Avatar
 
Join Date: Dec 2004
Posts: 699
Quote:
Originally Posted by Katsmeow View Post
I guess I could work for the next 7 years but I have two problems with it. First, I don't see that I need to. We have $350k in 401(k) If, say, I worked 2 more years and we maxed it out and the returns were zero, in 2 years that is about $430k. DH would get about $700k from his lump sum. So that is $1,130,000. Using 4% that is roughly $45k a year. His SS at 66 is estimated at $27576. If I work until 62 and take it, my estimated would be $22,008. If I retired in 2 years (the earliest possiblity that I see) mine would be $20664 at 62.
BTW, thanks for sharing - hopefully helpful for you, informative for all. I figured one/both of you had "prior families" or other circumstances.

Someone said earlier in thread that demonstrating / confirming one's retirement budget while still working is a good idea.

We're going to be doing that - until you're in those "budget shoes" you don't know how they are going to fit...
Delawaredave5 is offline   Reply With Quote
Old 11-08-2009, 12:02 PM   #36
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
Katsmeow's Avatar
 
Join Date: Jul 2009
Posts: 5,307
Quote:
Originally Posted by rec7 View Post
The average family in the US makes about 50k a year. It should be easy to be average in Texas for 50k a year. Here are some 2007 numbers for Texas.

ERS/USDA Data - TX Unemployment and Median Household Income

That is an interesting question. Yet, I don't think it is that simple. Here is an example.

My younger son attended a therapeutic school for several years. Tuition/fees were roughly $30k a year. School let out at 3:45 and the childrenn had to be picked up then. There was absolutely no after school year. The school was a very unique, nationally known school and there services could not be duplicated in public schools or even other private schools. The majority of the parents had a non-working parent who could pick up the children after school. DH and I both worked and did not have jobs that would accomodate picking up our son. I spent much effort trying to find the cheapest way to get him home from school (I could drive him in the mornings so that was never an issue). I found one private service but it was over a $1000 a week. Well, no. I looked into taxis (we lived a long distance from the school. We thought about moving close to the school but it was in an extremely expensive area to live so was cost prohibitive) and that was also extremely expensive. We emailed every parent to see about whether a parent could pick him up and he could stay at that parent's house or the parent would bring him to ours (we would have compensated the parent for that) but no dice. There were some potentials there but no one would commit to being able to do it all the time. It was catch as catch can.

Ultimately by far the cheapest solution was to use an au pair on a J1 visa. Even so, annual au pair costs were overall about $20k.

So for the 4 1/2 years he was in that school our out of pocket cost was $50k a year.

During that time, by chance I was talking to my daughter's public school teacher (our other two kids were in public school) and found out that her son attended the therapeutic school. She was making a teacher's salary, had applied for and received a complete scholarship from the school. Her school day ended early enough she could pick him up from school.

So she had zero cost for her son to attend the school, but it cost us $50k. I don't begrudge her that. I'm glad the school provided financial aid. But it is an example of how you just can't necessarily compare expenses between the average income and someone else.
Katsmeow is offline   Reply With Quote
Old 11-08-2009, 05:04 PM   #37
Thinks s/he gets paid by the post
 
Join Date: Oct 2005
Posts: 4,898
Hi,
If you both retire, will you still be on your husband's health insurance policy? Sorry, I missed that bit in the long thread. If not, you might consult a health insurance agent to get an idea how much your premium will be on the open market. I am 60 with minor exclusions (of about $600 year) and I pay $430 mo with a $2700/yr deductible, no co-pays. This is an important consideration, even though Obamacare might change things. I doubt costs will go down for individual health insurance for early retirees.

Another consideration that I hesitate to bring up, but which might put a real kink in your plans. What if your college grads can't find good jobs? They will need health insurance policies. They might, gulp, have to come home again for a while. You might consider this when you are looking to downsize your home.

Congrats on doing so much research!
Zoocat is offline   Reply With Quote
Old 11-08-2009, 07:50 PM   #38
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
Katsmeow's Avatar
 
Join Date: Jul 2009
Posts: 5,307
The health insurance issue is an important one. DH will have retiree coverage, the kids and I will not (well, not past COBRA). Also if I leave my employer neither I nor the kids would have any coverage.

The kids may well have difficulty finding coverage. Two of our children were internationally adopted and have 2 genetic disorders which in some people can be life threatening or disabling. In our kids, they are not and have required no treatment other than being aware of them and not doing things that would worsen them (one is a connective tissue disorder and the other is a blood disorder). For one of the disorders, there is a version of it that is usually fatal before age 40. There is a genetic test for that version which my older son had so I know they don't have it (he doesn't have it, his sister couldn't have it). However, I imagine that most insurers would be spooked by these two disorders and would deny coverage.

I have sort of thought that worst case was the Texas high risk pool. Under that I would pay $590 for a plan with a $5000 deductible or $756 a month for the HSA plan with $3000 deductible.

My children's would cost $221 or $283 a month for the same plans (would go up very slightly from ages 19 to 24).

As far as kids coming home, I have mixed feelings about that. I could see letting kids stay with us for awhile but, on the other hand, I think there is a point where they have to make their way. Having said that, we plan to buy a 4 bedroom house (albeit the 3 bedrooms other than the master will likely be quite small given the size house we want) and so they could stay there for a time. The insurance question is a real one and I've discussed with them keeping coverage and not letting a gap occur. Whether they will listen to me or not is a different issue....
Katsmeow is offline   Reply With Quote
Old 11-09-2009, 07:55 AM   #39
Thinks s/he gets paid by the post
 
Join Date: Jul 2007
Location: St. Louis
Posts: 1,563
Well Kats I don't have all the answers, but I know there many people on the board that live on 15k to 25k a year. The Lord has given you a bigger load to carry but he has also given you one heck of a income. I don't know the details but there must be some ways for you to cut your budget.
FANOFJESUS is offline   Reply With Quote
Old 11-09-2009, 03:54 PM   #40
Full time employment: Posting here.
 
Join Date: Oct 2007
Location: New York
Posts: 898
Quote:
Originally Posted by Katsmeow View Post
I guess I could work for the next 7 years but I have two problems with it. First, I don't see that I need to. We have $350k in 401(k) If, say, I worked 2 more years and we maxed it out and the returns were zero, in 2 years that is about $430k. DH would get about $700k from his lump sum. So that is $1,130,000. Using 4% that is roughly $45k a year. His SS at 66 is estimated at $27576. If I work until 62 and take it, my estimated would be $22,008. If I retired in 2 years (the earliest possiblity that I see) mine would be $20664 at 62.

If DH is retired and I am not yet 62, then income (without increasing withdrawal rate above 4% until I am 62) is $72576. Once I hit 62, then that increases to $93,240.

I don't think I need to work another 7 years to pile up $2 million. I probably will work more than 2 more years although I am seriously considering requesting in a year or so a reduction in work hours for a reduction in salary (probably in the 20% to 30% range).


Have you accounted for income taxes? You say you need 98k, but then you show us how you'll get 93k worth of pre-tax income. Thats a big gap.
__________________
Money's just something you need in case you don't die tomorrow.
Maurice is offline   Reply With Quote
Reply

Tags
budgeting, downsizing, expenses


Currently Active Users Viewing This Thread: 1 (0 members and 1 guests)
 
Thread Tools
Display Modes

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is Off
Trackbacks are Off
Pingbacks are Off
Refbacks are Off


Similar Threads
Thread Thread Starter Forum Replies Last Post
reducing work hours before retirement ranchoparque Hi, I am... 33 11-20-2009 03:25 PM
extra expenses? lowered expenses? 72t? retiringat50 FIRE and Money 6 01-08-2008 08:30 PM
Consumption reducing home modifications? Peaceful_Warrior Other topics 2 08-15-2007 10:50 AM
Reducing AGI kjpliny FIRE and Money 11 01-04-2007 10:36 PM
Vanguard Reducing the Admiral Shares Threshold TromboneAl Other topics 16 05-10-2005 10:41 AM

» Quick Links

 
All times are GMT -6. The time now is 08:35 PM.
 
Powered by vBulletin® Version 3.8.8 Beta 1
Copyright ©2000 - 2024, vBulletin Solutions, Inc.