Can I financially retire when I turn 57?

[F.I.R.E User]

Hello and Happy New Year Team!

Net Worth: $1.18M.

Age: 47 (48 this month), Male, Single, No Kids (No plans).

Emergency funds: $3,000 earning 3.94% APY at online VIO Bank.

Checking account: $100.

Debt: $0.

Tax Filing Status: Single.

Tax Rate: 12% Federal (Effective Tax Rate is lower), 0% State.

State of Residence: Texas.

Salary: $~80k/yr with about 3% increase every year.

Family Social Security:

- Brother A: $500/mo.
- Brother B: $350/mo.
- Mother: $150/mo.

= $12k/year until death of mother (age 83). The 3 relatives send me money every months to take care of my mother and help pay the overall bills.

Current retirement assets

Taxable:

$108,200 at Vanguard VTSAX.

ESPP: $3,389. Company A (1% of paycheck), 1 year holding period before selling required, 15% per share discount. Using the profits to invest in VTSAX taxable account at Vanguard.

Traditional 401k: $779,931, SP 500 INDEX PL CL G, ER: 0.0050%, no fees. AND SMALL CAP INDEX, ER: 0.02%. Mgmt Fee: 0.0050%.
6% Company Match $1 to $1. Contributing $23.5k for 2025 and $24k for 2026 with True Up option available.
85% is SP 500 INDEX PL CL G AND SMALL CAP INDEX is 15% which mimics VTSAX correct?

Roth IRA at Fidelity: $282,185 FZROX), Expense Ratio: 0.00%. Contribution: $7k and $7.5k in 2026.

Employer has Roth 401K option.

Note: NEW! AFTER-TAX CONTRIBUTIONS

If you have already made the maximum pretax and/or Roth contribution possible (including catch-up contributions if eligible), consider making an after-tax contribution to save even more for your retirement. You can contribute up to $10,000 annually after-tax. After-tax contributions are not matched.

NEW! ROTH IN-PLAN CONVERSION

If you choose to make after-tax contributions, consider a Roth In-Plan Conversion of those contributions to build the most potentially tax-free income possible. The automated Roth In-Plan Conversion with Daily Sweep feature makes this simple by converting after‑tax balances automatically.

Currently, I am not doing $10k on the 401k after tax but at Vanguard for taxable account. I will have to go with the 401k funds offered so I will not have a chance to whatever index fund I want. Is that OK?

Asset: 2016 Ford Fusion SE, paid off.

Never owned a house and do not plan to.

I am looking to spend around $75k-$100k a year. These are all rough estimates for now. What do most people spend annually similar to my situation?

Credit score 800+.

Game plan moving forward:

Max out t401k to the limits.
Max out Roth IRA to the limits.
$10k-$15k in VTSAX taxable.
Total: $50k~ per year contributions (includes company match).

SS at 70: $38,796 according to my account at SSA but that is assuming I work till 70 calculations?

HEALTH COSTS: My company will offer some type of health insurance plan until Medicare kicks in at 65 from age 57. I assume for now it will be much cheaper than going with ACA from what I have read.

My health is pretty good far. Also, physically fit. 3x in gym for muscle growth and low BF%. Blood tests are also normal.

ChatGPT says: Since I don't plan to leave a legacy I can go aggressive on the SWR to 5% to 6%. I should also add Bonds exposure when I turn 52 which is 5 years before retirement. The question is I am not sure how much Bonds exposure I should have. Should I have anything in cash in retirement and use that if market tanks 10% to 50% that year? What about any international fund for my AA?

 

[RetiredHappy]

What is this?
Family Social Security:

- Brother A: $500/mo.
- Brother B: $350/mo.
- Mother: $150/mo.

= $12k/year until death of mother (age 83)


Since you don't intend to buy a home, what is your current and future living situation?

 

[Midpack]

Run your inputs through FIRECalc: A different kind of retirement calculator and let us know what questions or concerns you may have.

 

[F.I.R.E User]

What is this?
Family Social Security:

- Brother A: $500/mo.
- Brother B: $350/mo.
- Mother: $150/mo.

= $12k/year until death of mother (age 83)


Since you don't intend to buy a home, what is your current and future living situation?

Those relatives send me the amount I posted every month. I am renting now. Always have.

 

[Fermion]

I am also very curious of the Family Social Security. I have never heard of that.

edit: Oh, I see your response. Your family differs from mine.

 

[F.I.R.E User]

Run your inputs through FIRECalc: A different kind of retirement calculator and let us know what questions or concerns you may have.

Do I use Monte Carlo? That calc has always been confusing to me. Should I tell ChatGPT to do the work?

 

[tulak]

Read up on the Roth in-plan conversion. This is a Mega Backdoor Roth and at under 50, allows you up to 72k/year. You’ll need to adjust that amount based on other tax sheltered/deferred contributions.

https://www.bogleheads.org/wiki/Mega-backdoor_Roth

 

[F.I.R.E User]

I am also very curious of the Family Social Security. I have never heard of that.

The relatives I listed send me money every month to take care of my mother and help pay the bills.

 

[Fermion]

The relatives I listed send me money every month to take care of my mother and help pay the bills.

Oh! That makes more sense

 

[RetiredHappy]

The relatives I listed send me money every month to take care of my mother and help pay the bills.

Thank you. It makes sense now.

 

[F.I.R.E User]

Read up on the Roth in-plan conversion. This is a Mega Backdoor Roth and at under 50, allows you up to 72k/year. You’ll need to adjust that amount based on other tax sheltered/deferred contributions.

https://www.bogleheads.org/wiki/Mega-backdoor_Roth

Should I stop contributing to my taxable account at Vanguard for VTSAX and fund my post tax 401k using same funds and AA until I reach $10K for the year? Then, when do I transfer those funds to my Roth IRA? Won't that create a tax event?

 

[RetiredHappy]

For me, I really dislike FIRECalc because like you, the UI is unfriendly and confusing to use. I use Fidelity Retirement Planner exclusively.

You can make different "defensive" moves to mitigate SORR, whether it is bonds, TIPS or MYGA.

 

[Aerides]

A few things stand out.

I would not ever consider including your "family" contributions in your plans. Plan as if they all stopped today, period.

I would also not be asking - nor should you - what others spend each year. That's not relevant. What YOU are spending is what is important. You have been here long enough to know how to figure that out.

Assume healthcare will run you well north of your plans. 10 years from now it could be wildly different, who knows..

 

[bada bing]

Should I stop contributing to my taxable account at Vanguard for VTSAX and fund my post tax 401k using same funds and AA until I reach $10K for the year? Then, when do I transfer those funds to my Roth IRA? Won't that create a tax event?

It's helpful to understand the mechanics of the "Mega Backdoor Roth" Just search for the term and a lot will pop up. Generally, if you have the access to the Mega Backdoor Roth and also have excess money to save after using the qualified annual limits, a Mega Backdoor Roth is a better placement than a taxable account. You have to weigh the access restrictions prior to 59.5 but if those don't bother you, go for it. I used all the Mega Backdoor limits available for over 10 years before retiring and ended up with a significant Roth balance and I'm happy I did. Remember that money is fungible and you can move the money already saved in after-tax into Roth over time if you don't have the current income to fully fund the Mega Backdoor limits.

 

[TheWizard]

What does family SS have to do with anything?

 

[F.I.R.E User]

For me, I really dislike FIRECalc because like you, the UI is unfriendly and confusing to use. I use Fidelity Retirement Planner exclusively.

You can make different "defensive" moves to mitigate SORR, whether it is bonds, TIPS or MYGA.

I’ve used both. Fidelity doesn’t focus on FIRE?

 

[tulak]

Should I stop contributing to my taxable account at Vanguard for VTSAX and fund my post tax 401k using same funds and AA until I reach $10K for the year? Then, when do I transfer those funds to my Roth IRA? Won't that create a tax event?

I missed that you are limited to 10k/year. If you weren’t limited, I would consider maxing this contribution above everything else, including the 401k after the company match. But since it’s only 10k/year, I would contribute up to 10k.

I would contribute to the in-plan conversion account before taxable. If you need this money sooner than 59.5, then you can withdraw the contribution without penalty. (ETA: I think this is wrong, you need to wait 5 years since it’s considered a conversion).

As for taxes, it depends on how it is managed by your administrator. My Roth in-plan conversion happens immediately after the after tax contribution, so effectively there is no tax. If there is a delay between when you contribute and when you convert, then yes, you could pay taxes. The wording you shared from above, “The automated Roth In-Plan Conversion with Daily Sweep feature makes this simple by converting after‑tax balances automatically,” leads me to believe you won’t have any tax impact, but I would double-check.

And I would ask your employer to see if they can remove the 10k cap. It never hurts to ask. I’m able to save 40-50k/year this way and it adds up.

 

[F.I.R.E User]

A few things stand out.

I would not ever consider including your "family" contributions in your plans. Plan as if they all stopped today, period.

I would also not be asking - nor should you - what others spend each year. That's not relevant. What YOU are spending is what is important. You have been here long enough to know how to figure that out.

Assume healthcare will run you well north of your plans. 10 years from now it could be wildly different, who knows..

FSS won’t stop until mom passes away but it helps a lot to pay big part of our rent. I never ask. They send it at their own will.

Employee healthcare can kick in at 57 until 65. It is most likely to be much cheaper than ACA.

 

[tulak]

You have to weigh the access restrictions prior to 59.5 but if those don't bother you, go for it.

I forget, you probably have to wait 5 years before taking this money out since it’s a conversion. I said immediately above thinking about contributions, which I think is wrong. I would double-check if you go this route and make sure you understand the rules.

 

[Dtail]

What does family SS have to do with anything?

Already answered in prior posts.

 

[F.I.R.E User]

It's helpful to understand the mechanics of the "Mega Backdoor Roth" Just search for the term and a lot will pop up. Generally, if you have the access to the Mega Backdoor Roth and also have excess money to save after using the qualified annual limits, a Mega Backdoor Roth is a better placement than a taxable account. You have to weigh the access restrictions prior to 59.5 but if those don't bother you, go for it. I used all the Mega Backdoor limits available for over 10 years before retiring and ended up with a significant Roth balance and I'm happy I did. Remember that money is fungible and you can move the money already saved in after-tax into Roth over time if you don't have the current income to fully fund the Mega Backdoor limits.

My employer offers Rule of 55 for 401k plan. So should I stop funding my taxable account at Vanguard and fund after tax t401k to $10k first?

 

[F.I.R.E User]

What does family SS have to do with anything?

They are income.

 

[F.I.R.E User]

I missed that you are limited to 10k/year. If you weren’t limited, I would consider maxing this contribution above everything else, including the 401k after the company match. But since it’s only 10k/year, I would contribute up to 10k.

I would contribute to the in-plan conversion account before taxable. If you need this money sooner than 59.5, then you can withdraw the contribution without penalty. (ETA: I think this is wrong, you need to wait 5 years since it’s considered a conversion).

As for taxes, it depends on how it is managed by your administrator. My Roth in-plan conversion happens immediately after the after tax contribution, so effectively there is no tax. If there is a delay between when you contribute and when you convert, then yes, you could pay taxes. The wording you shared from above, “The automated Roth In-Plan Conversion with Daily Sweep feature makes this simple by converting after‑tax balances automatically,” leads me to believe you won’t have any tax impact, but I would double-check.

And I would ask your employer to see if they can remove the 10k cap. It never hurts to ask. I’m able to save 40-50k/year this way and it adds up.

Stop contributing to VTSAX at Vanguard and fund up to $10k after tax t401k using same funds and AA first? How do I convert the principal after tax contributions to my Roth IRA? Do I do it annually? Can I convert the gains too on that $10k?

I do not know if I will need this money sooner than 59.5 as my employer offers Rule of 55 for 401k plan.

 

[Al18]

It seems like you’re not accounting for any downside. What if the stock market is down 20% this year and you loose your job? I think you should focus on 10-20% of your assets in fixed income, such as CD, Treasury’s, iBonds, etc. What if the rule of 55 is canceled before you reach 55?

 

[Koolau]

The relatives I listed send me money every month to take care of my mother and help pay the bills.

Oh! That makes more sense

I guessed that's what you were referring to. My only living sister never lifted a finger to help me with taking care of my mom. Rarely even visited. I'm so glad your family is committed to helping you take care of your mom. What a great model for elder care!