Hello! 2021 might be my FIRE year

[LeeLee2021]

Hello everyone! I've lurked here for quite a few years (thanks for all the silent guidance!) and finally got the push I needed to introduce myself. I was given my (hoped for) layoff notice and have been nervously updating spreadsheets ever since.

My spouse and I are DINK, nearly 50, live in a MCOL city in the South, and have been using a trusted financial planner for years (I know, I know, but we've been super happy with him and he's only a $2k/year fee. He’ll likely be retiring soon, which is when I’ll take over). He thinks I can retire next year and spouse in ~5 years.

My layoff is generous in these pandemic times - last workday is the end of this year, with severance payments and benefits through April 2021. We'll shift to the spouse’s health benefits after that. I plan to take a sabbatical and reevaluate if I’m done done. The kink is spouse’s work BS meter is trending into the red zone, so if they need to hit the eject button, I will find another job with benefits to allow them to quit and have time off to decompress/reevaluate.

I pulled 3-year spending averages that showed us at ~$160k/year, but that includes a high savings rate. When I trim the fat to fit within one $130k income, annual spending looks like it would be ~$100k/year. That’ll run a small deficit that we plan to cover with savings.

For FIRECalc I'm starting with a total of $2M assets, $100k spend, retirement year 2021. That gives me 72% and 93% if I add in SS. Are those the right numbers? How do I model me retiring in 2021, and then figuring out when spouse can retire?

Here are our assets:
Total (w/property but minus the mortgage) $2.5M
Total (minus property and mortgage) $2M
Non-Qualified Assets $725k (~150k cash)
Qualified Assets $1.2M
Market Assets $1.2M

Our biggest unknown, once we're both retired, are healthcare costs. We both have LTC and whole life, and via HealthSherpa I see non-subsidized ACA policies currently range $9-15k/year all in, so I'll budget $15k/year to start and expect increases.

Congrats on reading this far, kind internet strangers Where are our blind spots? What important info have I forgotten to include? How do I get more comfortable knowing when we can both call it quits? What other things should I be concerned about?

 

[ShokWaveRider]

If the ACA stays intact you will be good.

 

[pjigar]

Did you run firecalc? You're spending looks high for asset base but your age and any pension can make big difference. Make sure you account for taxes, Healthcare and long term expenses like car, home repairs, etc.

PS: we are at similar expenses and my year is 2024.

 

[HI Bill]

For FIRECalc I'm starting with a total of $2M assets, $100k spend, retirement year 2021. That gives me 72% and 93% if I add in SS. Are those the right numbers? How do I model me retiring in 2021, and then figuring out when spouse can retire?

Welcome! I'd put my retirement date as next year. Then, in the second tab (Other Income/Spending), under Pension Income use your wife's income (selecting the Pension Income bubble), annually from the present to an assumed end date (1, 2, 5 years, etc). Alternatively, under the Not Retired? tab, you could use your wife's retirement date(s) and add your annual savings with only her working. Then you can fine-tune each option using the Investigate tab.

 

[LeeLee2021]

If the ACA stays intact you will be good.

Fingers crossed that ACA either stays the same or improves in the future! If that happens, it'd take a load off of my worries.

 

[LeeLee2021]

Did you run firecalc? You're spending looks high for asset base but your age and any pension can make big difference. Make sure you account for taxes, Healthcare and long term expenses like car, home repairs, etc.

PS: we are at similar expenses and my year is 2024.

I ran FIRECalc with a total of $2M assets, $100k spend, and retirement year 2021. That gives me 72% and 93% if I add in SS. Now I'm figuring out how to model me retiring in 2021 and figure out when my spouse can retire (2024?). HI Bill had some ideas on that that I'm trying out now.

Our expenses are what we're working through presently - I'm pretty sure we can get to that 100k number within 12 months...there are a few committments that are dropping off helping that number go down naturally. One is that we're planning to sell our house to cash out and move into our currently rented condo, which will also help.

 

[LeeLee2021]

Welcome! I'd put my retirement date as next year. Then, in the second tab (Other Income/Spending), under Pension Income use your wife's income (selecting the Pension Income bubble), annually from the present to an assumed end date (1, 2, 5 years, etc). Alternatively, under the Not Retired? tab, you could use your wife's retirement date(s) and add your annual savings with only her working. Then you can fine-tune each option using the Investigate tab.

Thanks! If I do it via the second tab (Other Income/Spending), the year indicates "starting in", not ending in? That feels backwards?

Alternately - for the not retired tab, if I put say 2024 when spouse retires, then I need to subtract my salary from each year on the Spending 2nd tab?