Are you paying off the mortgage by putting more toward the principle each month? IOT pay off $214K in 7 years you’ll need to pay ~$2.5K/mo (plus taxes and insurance).
How much is your mortgage interest rate? If it is low, I would consider investing the extra money instead and letting those additional years work their compounding magic towards your goal of $5M.
That said, I understand those who want the satisfaction of zero debt.
It is a tough balance. And then you need taxable income like they say to fund the years 50-55 before any IRA dividends can be taken.
My plan, 2.5mil by 50, 1mil of equity, 2 rentals producing 1/4 of my annual projected 70-100k budget.
Then, cash plus taxable brokerage money will fund me until a small raise at 65 (pension) to reduce SWR, another small raise at 70 (SSA FRA), and then my RMD which comes around 71.5.
That should last me 35years. I anticipate my years 50-71.5 (RMD) to be the best in terms of quality and getting around, then I expect a decline that will limit mobility and travel expense...likely decreasing overall SWR again. Soo, I won't hesitate to spend any less than I can to last me 35years.
Now if health declines at all, I will inversely increase spending, either on treatment or blow my dough mentality.
Adversely, if DW and I inherit stretch IRAs like we fully anticipate (both folks multi million one living off just dividends until RMD and one not even touching principle until RMD comes due to 5 passive income streams) then we will definitely look at the blow your dough some more.
Been taking regular trips out of the cold to warm places, and many cross country experiences with the family. We are fam of 4, possibly 5 so your mileage will vary and current annual budget of 100k. No debt besides a cpl mortgages.
I have 13 more years and a mortgage to payoff, taxable accounts to fund all sorts of fun. We are currently saving 50% of our combined income, and when we are done with daycare plan to increase saving near 65%, then when mortgage is done in 9/10 years push it up even more close to 75% that last 4years before we ER. Then we can spend the next year touring colleges for first kid. They have a 529 but hoping to stock up on grants, scholarships and edge towards state or CC or even trade if they are interested. Degrees can be over rated. Look at me I don't have one and earn well over 5zeros. But there will be some money there for that.
Any windfalls we get now will likely be divided equally into broker, HSA, cash in that order.
I don't know how this plan can fail. I call this my 10 legged stool.
1. Cash (for emergency fund, buy low opportunities, and gap years)
2. Income Property rents (for part of annual COL + Equity to pass along as legacy. Looking at 1031 to reset basis and depreciation
3. Taxable broker (for my gap years)
4. HSA (for our health expenses)
5. 529 (for some of the kids college)
6. IRA (dividend withdrawals to help with gap years 55-RMDs)
7. Pension (reduces SWR at 65)
8. SSA (reduces SWR at FRA 70)
9. Roth IRA (for our legacy)
10. Inherited Stretch IRA and DF income properties (5)
Pretty sure I could drink the entire bottle and still be sitting on that stool. Everyone would look attractive, but that stool will be sturdy
Just need to survive this last 3160 days of showing up to w
rk!