All
I stumbled across this site when I was trying to run Monte Carlo scenarios without dealing with a Financial Advisor and that's when I found the FIREcalc and ultimately landed here.
I am 55 and my wife is 53. Daughter has graduated college and son will graduate in December. We had plans on retiring at 55 but here I am still working! My uncle and his father set the "55" target for us. My wife will retire at 55 and I was targeting 59.5 until I found this site and the FIREcalc. I have kept a spreadsheet for years with projected retirement numbers by year as well as determining how long that money will last based on 3% inflation, 5% market growth and 4% initial spend (then adjusted upward by that 3% inflation each year). After running it through FIRECalc, I think I can probably retire a year or two earlier than I had targeted.
Here are the details:
* $3.1 million in retirement assets ($2.4 M in 401k, $150K in investment account and $600K in liquid assets (cash, CDs, etc).
* Currently max out 401k including catchup ($30K this year each for wife and I)
* Company match is $6k per year ($3K for me and $3k for wife)
* Contribute another $18k to the investment account each year
* Save about $100K per year
* We just downsized to a condo in Dallas and have a lake property in another state. We plan on keeping Texas residency for tax purposes (no state income tax)
* no debt with the exception of the $275k mortgage on the lake property with a monthly payment of $1250 (around 3% interest) and a market value of $700k easily
* we have expensive hobbies (motorcycles, SxS and go-fast boats) that we don't expect to change until we can no longer enjoy those hobbies BUT I do all the work myself and expect that to continue. However, toys are never financed!
* the estimated spend in retirement is about $88K after taxes or roughly $117K pre-tax.
* we have kept a budget for years (my undergrad degree is in Finance and my wife is an accountant by trade) and interestingly enough, if we take the expenses that we would have in retirement (so no kids college, no additional investment, no savings monthly etc) it shows that we pend on average about $80 to $85K a year after taxes so my number of $88k for retirement expenses is not too far off that number.
*For my spreadsheet that I mentioned above, I had projected spending $165K per year PLUS another $25K per year for health insurance (which is another unknown) - that number is well above the $117K that I projected that we need! This scenario has me running out of money at age 99 on the spreadsheet.
* On FIREcalc I projected 35 years of retirement and taking Social Security at 62 for both of us ($28K for me and $20K for my wife). This gives us a 96% probability of ending above the zero line after 35 years. Based on retiring at 58 instead of 59.5. If I change retirement to 57 (2 more years of work) and leave everything else constant, then probability goes down to just below 90.
We have not factored in ANY inheritance from parents (not banking on it but it would help obviously) nor the stock options that may or may not come to fruition if my company goes public. Nor have we factored in that we could cash out of one of the properties as we get older if needed.
SO, I am trying to talk myself into sooner rather than later but have become more conservative as I get older (the wife has always been financially conservative as an accountant).
I would welcome your thoughts - also questioning whether we pay off the mortgage on the lake house. Obviously that reduces my cash reserves/liquid assets by almost half. That is the money that we had planned on using prior to tapping into the 401k at 59.5 and SS at 62.
I don't want to work a day more than I have too but also don't want to run out of $$. I guess that is the situation for almost all of us!
I stumbled across this site when I was trying to run Monte Carlo scenarios without dealing with a Financial Advisor and that's when I found the FIREcalc and ultimately landed here.
I am 55 and my wife is 53. Daughter has graduated college and son will graduate in December. We had plans on retiring at 55 but here I am still working! My uncle and his father set the "55" target for us. My wife will retire at 55 and I was targeting 59.5 until I found this site and the FIREcalc. I have kept a spreadsheet for years with projected retirement numbers by year as well as determining how long that money will last based on 3% inflation, 5% market growth and 4% initial spend (then adjusted upward by that 3% inflation each year). After running it through FIRECalc, I think I can probably retire a year or two earlier than I had targeted.
Here are the details:
* $3.1 million in retirement assets ($2.4 M in 401k, $150K in investment account and $600K in liquid assets (cash, CDs, etc).
* Currently max out 401k including catchup ($30K this year each for wife and I)
* Company match is $6k per year ($3K for me and $3k for wife)
* Contribute another $18k to the investment account each year
* Save about $100K per year
* We just downsized to a condo in Dallas and have a lake property in another state. We plan on keeping Texas residency for tax purposes (no state income tax)
* no debt with the exception of the $275k mortgage on the lake property with a monthly payment of $1250 (around 3% interest) and a market value of $700k easily
* we have expensive hobbies (motorcycles, SxS and go-fast boats) that we don't expect to change until we can no longer enjoy those hobbies BUT I do all the work myself and expect that to continue. However, toys are never financed!
* the estimated spend in retirement is about $88K after taxes or roughly $117K pre-tax.
* we have kept a budget for years (my undergrad degree is in Finance and my wife is an accountant by trade) and interestingly enough, if we take the expenses that we would have in retirement (so no kids college, no additional investment, no savings monthly etc) it shows that we pend on average about $80 to $85K a year after taxes so my number of $88k for retirement expenses is not too far off that number.
*For my spreadsheet that I mentioned above, I had projected spending $165K per year PLUS another $25K per year for health insurance (which is another unknown) - that number is well above the $117K that I projected that we need! This scenario has me running out of money at age 99 on the spreadsheet.
* On FIREcalc I projected 35 years of retirement and taking Social Security at 62 for both of us ($28K for me and $20K for my wife). This gives us a 96% probability of ending above the zero line after 35 years. Based on retiring at 58 instead of 59.5. If I change retirement to 57 (2 more years of work) and leave everything else constant, then probability goes down to just below 90.
We have not factored in ANY inheritance from parents (not banking on it but it would help obviously) nor the stock options that may or may not come to fruition if my company goes public. Nor have we factored in that we could cash out of one of the properties as we get older if needed.
SO, I am trying to talk myself into sooner rather than later but have become more conservative as I get older (the wife has always been financially conservative as an accountant).
I would welcome your thoughts - also questioning whether we pay off the mortgage on the lake house. Obviously that reduces my cash reserves/liquid assets by almost half. That is the money that we had planned on using prior to tapping into the 401k at 59.5 and SS at 62.
I don't want to work a day more than I have too but also don't want to run out of $$. I guess that is the situation for almost all of us!
