glasswave
Dryer sheet aficionado
Hello all,
I fear that there is some blatantly stupid blind spot to this plan, so I am hoping the posters here can quickly point out the errors of my ways. Please forgive my newbie naivete, but when I finally landed my first good job that had a savings plan, a TIAA advisor said, "Stick your money in a growth fund and forget about it," so that's what I did. 15% of my gross year since 1994. I have only been looking at retirement for the last few years and seriously, only recently.
Hear goes:
67 is my full retirement age. (spring 2030).
I am hoping to take early retirement in June of 2025 at age 62, but I could work longer.
Preliminary Plan:
Is this a sound strategy or should I not worry so much about converting to Roth for the tax advantages?
What other strategies might you recommend?
Thanks.
~~~~
I fear that there is some blatantly stupid blind spot to this plan, so I am hoping the posters here can quickly point out the errors of my ways. Please forgive my newbie naivete, but when I finally landed my first good job that had a savings plan, a TIAA advisor said, "Stick your money in a growth fund and forget about it," so that's what I did. 15% of my gross year since 1994. I have only been looking at retirement for the last few years and seriously, only recently.
Hear goes:
67 is my full retirement age. (spring 2030).
I am hoping to take early retirement in June of 2025 at age 62, but I could work longer.
- I should have about $190k in liquid savings by July of 2025.
- I have about $945,000 in a (TIAA) tax deferred retirement savings account.
- I can receive about $18k in salary for 5 years by taking early retirement at 62.
- House is paid off, no other debt whatsoever.
- I can stay on the employer health plan until Medicare kicks in at 65 for about $300/yr.
- I’d like $4k/mo for expenses from 62 to 67. $3k monthly living & $1k/mo towards trips and large purchases.
Preliminary Plan:
- I am thinking about living off of liquid savings and my early retirement income for the 5 years of early retirement. I am also are considering converting most of my retirement account to a Roth IRA over those 5 years, by converting about $170k a year so I can stay in the 24% marginal bracket.
- At 67, I plan on accessing my SS which should pan out to $2500-$3000/mo, so I will need to start drawing at least $1000-$1500/mo from that Roth IRA at 67 so I can maintain my lifestyle. I will also have the added expense of Medicare Premiums.
- I figure by converting it all to Roth asap, most of my taxes will be paid and I should be able to live mostly income tax free after that.
Is this a sound strategy or should I not worry so much about converting to Roth for the tax advantages?
What other strategies might you recommend?
Thanks.
~~~~
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