Wanted Opinions on RE Strategy

[Big Game James]

IMO before cutting it that close be very, very sure you can keep expenses low. Though the VA might cover medical costs, what about if you get laid up for a few months recovering from something? Do you have someone who can bring you food, check in on you, etc. or will you have to pay for such services?

Agreed... Please remember if your investments aren't outpacing inflation (which should be the bare minimum) your essentially just saving and investing to go backwards... =( Not to sound rude at all ya know.. just sayin...

 

[Jackson D]

I like your plan and think setting this as a goal is a great idea. 8 years gives you plenty of time to refine your plan and goals while living your life the way you want now. I agree with obgyn65 that your numbers may be low but you can adjust the numbers and how long you work as you go.

As a concrete suggestion I would say open up a Roth IRA with Vanguard as soon as you can and use it for some of your savings. You are in a very low tax bracket now and this will allow you to keep it that way when you retire. Something like Vanguard Target Retirement Fund 2020 would give you growth and get more conservative as you approach your retirement date. You could always switch to 2025 if you wanted to work awhile longer.

In my mind, working toward your goal will put you in the position where you then have the option to work or not as you choose. Working a little longer doing what you want may seem perfectly fine to you at that point and would just help give you more of a cushion in your spending. Taking the steps your are taking now will give you options that other 45 year olds can only dream about.

Jackson

 

[kcowan]

why1942
Congratulations. I think you have a grounded approach, and that you are open-minded enough to adapt to changing conditions as necessary. Best of luck to you.

Have you investigated Perpetual Traveler sites? I notice that even the most diehard eventually set down roots. Maybe in your case, it will just be a favorite forest!

 

[why1942]

Yep, Yep - Well Maybe

why1942
Have you investigated Perpetual Traveler sites? I notice that even the most diehard eventually set down roots. Maybe in your case, it will just be a favorite forest!

Hey Kcowan,

I'm not much for traveling. In my "younger" days I lived for short periods in Texas and back east, spent two years in Europe, got to see Pisa, Paris and a few other places I can't pronounce. I loved German Bavaria and the Alps, but it just reminded me of the PNW. I have also done a few cross country trips in the last several years and have seem most of the US (except for the deep south). I guess I'm just not all that impressed. I prefer consistency, dependability, and reliability to experiencing new and fascinating things. Give me a Super Walmart or my favorite grocery or pizza chain and I'm happy like a kid at Christmas.

Weather is also a key factor for me, which is why my considerations for buying real estate in the mid-west have grown cold. There may be cheap housing in Nebraska and Texas but I just don't care all that much for tornadoes and lots of snow (in the mid west for snow, not Texas).

I have a favorite 100 square mile area not far from where I currently live. It has the best ratio of pizza stores, grocery chains and super walmarts situated in towns under 20,000, all adjacent to large tracks of public/private forest land that is heaven on earth. It does rain (but I like that) and is often overcast, but the winters are quite mild (no snow) and summers are cool and refreshing (rarely in the 90's). For me it is heaven. As I've mapped it (and actually experienced much of it first hand) I could live out there indefinitely (and legally) with weekly trips to town for supplies on $100/month for gas @ $5/gallon. If the price of gas goes over that, I can always extend my stays to two week stops and just double up on my food supplies so I'm only going into town twice a month.

why1942

 

[why1942]

I like your plan and think setting this as a goal is a great idea. 8 years gives you plenty of time to refine your plan and goals while living your life the way you want now....As a concrete suggestion I would say open up a Roth IRA....In my mind, working toward your goal will put you in the position where you then have the option to work or not as you choose. Working a little longer doing what you want may seem perfectly fine to you at that point and would just help give you more of a cushion in your spending. Taking the steps your are taking now will give you options that other 45 year olds can only dream about.

Hey Jackson. I completely agree here. Oh. Already have a Roth and plan to max it out starting next year (maybe this year, depending). I need to first get my student loans paid off. I've killed $22k so far and have less than $11k to go. I'm paying just shy of 7% on it, so I want to pay it off as quickly as possible. Once that is done with I'll be debt free.

Then I plan to each year max out my Roth, then my 401k and then build savings. Once I'm finished with my self-employ gig I will be converting my 401k to an IRA and then plan to do systematic conversions into my Roth until all the money in my 401k is switched. This way my entire nest egg can be pulled out tax free in the future (unless they change the rules, but I'm hoping if I live below the poverty line this will help in that regard no matter who is running the ship - a national sales tax would kill me, though). My goal is to do conversions "while" I'm retire so I can use the full benefit of the zero percent tax bracket each year (if it's still around). Then I would basically get all my tax deferred money converted to tax free money without paying a cent in taxes (as I understand it anyway). I know there is a 5 year seasoning period for the Roth, then additional 5 year seasoning periods for each conversion, but this would be fine if I was working (firewatch) and/or living on the treasury interest.

I think what I really like most about your response is that by taking these steps now, when I turn 45 I will be much better off than I would have if I just worked and spent during those 9 years. I love having options - the more I can have the better. This was the main reason I chose to go into the military at 17 - it was the only option I had that kept all my other options open. Looking back on it, it was the best decision I could have made and I'm still reaping the benefits from those 4 years.

Options are a person's best friend in the end. ;-)