Would like thoughts, comments on FIRE

[F-One]

Getting anxious about FIRE, I'd like to start within 2 months, but would appreciate others input. (Sorry in advance for length)

Currently have $1.0 M (plus excess for fudge factors) in 43 / 37 / 20 stocks/ bonds/ CD's which is split about 50/50 taxable/retirement accounts

I also have an investment in a small company that is looking at selling this year, they have a M/A company that just began marketing the company and have indicated it should sell within 6 or less months. I discounted M/A company estimated selling price mid ranges by 10% (fudge factor), it would yield me around $2.1 M- 2.3 M after tax / expenses. The small company has had private offers over the last year that were rejected as too low that would have given me $1.9 M after tax.

I've run FIRECALC, along with other retirement programs (like OTAR's) with the $2.1M from sell of small company. I've included SS kicking in at 62 YO at about 50% of SS calculated amount along with moving costs of $650K (rent now in new area to confirm it for about 6 - 8 months, then new house, toys and cars; part of FIRE plan once the small company sold). All calculators say I should be good for 30 years (95% success or greater). Life expectancy calcs put us at 50% chance or less. (I would be selling my house but figure amount owed versus selling with cost of holding it for 1 year or so, I'd still make conservatively $30K, that isn't in any calculation). COBRA initially then private health insurance until Medicare (and only then reduce health budget by $4K), we both have back issues (me high blood pressure under control with meds), otherwise good health. Budget has 35K/year money set aside for health care costs (again fudge factors, rate increases hopefully built in to last).

We could, but would not like to adjust the house, toys part of retirement if the small company yield is more like $1.9 M. I believe once I quit, I would find it very difficult to find a j*b, so think going back to w*rk would be out.

Aside from continue to work until small company sells, have I overlooked something? Over analyzed things? Is it the two month to retire okay?

 

[Midpack]

If you've run FIRECALC (and Otar) and got a 95% probability of success, it tells you we'd have to have unprecedented low real returns in the next 30 years for your plan to fail. That's about all you can do to prepare.

However, we can't assess what you've done without knowing your projected retirement spending, which you may understandably not want to share. You had to enter it in FIRECALC, so you haven't overlooked anything, we just don't know one of the critical assumptions and therefore can't comment.

I also didn't catch your age, but I gather less than 62 from the SS assumption. Planning on 30 years is shorter than the norm (most shoot for end of plan about age 95), but you may have insights that suggest 30 years is safe in your personal longevity outlook. You mention a 50% chance on life expectancy, but not sure what that means. Obviously if you've planned on a 50/50 end plan/average age, you have a 50% chance of plan failure due to life expectancy.

FWIW...

 

[pb4uski]

The other thing to consider is at first blush it sounds like you could dial back your spending and still live very comfortably if your investment returns lagged some and there is some conservatism built into your numbers.

Congratulations!!!

 

[W2R]

You are smart not to include the proceeds from selling your home in your nestegg. The housing market has been so weird lately that it's pretty hard to count on selling at a given price sometimes.

COBRA initially then private health insurance until Medicare (and only then reduce health budget by $4K), we both have back issues (me high blood pressure under control with meds), otherwise good health. Budget has 35K/year money set aside for health care costs (again fudge factors, rate increases hopefully built in to last).

Have you looked into whether private health insurance is even available, given your high blood pressure and both of you having back issues? I keep hearing horror stories about the difficulty of getting private insurance at all if someone has conditions like these, even with BP under control as yours is.

I also have an investment in a small company that is looking at selling this year, they have a M/A company that just began marketing the company and have indicated it should sell within 6 or less months. I discounted M/A company estimated selling price mid ranges by 10% (fudge factor), it would yield me around $2.1 M- 2.3 M after tax / expenses. The small company has had private offers over the last year that were rejected as too low that would have given me $1.9 M after tax.

I've run FIRECALC, along with other retirement programs (like OTAR's) with the $2.1M from sell of small company.

I believe once I quit, I would find it very difficult to find a j*b, so think going back to w*rk would be out.

Can you wait the 6 or fewer months until after the small company has sold and you have this money in hand, before retiring? Normally that might seem too cautious but given the difficulty in finding another job in your field, that might seem prudent.

 

[Finance Dave]

Have you looked into whether private health insurance is even available, given your high blood pressure and both of you having back issues? I keep hearing horror stories about the difficulty of getting private insurance at all if someone has conditions like these, even with BP under control as yours is.

My thought exactly!