Hello - A new member here, but have been thinking about ER for a few years now.
Husband 46, Wife 45 - DINKS
Current pretax accounts $1.4 mil, after tax $255k, own home, no debt. Planning on receiving an estimated $1 mil in a profit share plan from employer in 2015. We intend to save and additional $250k, until ER in 2016.
Our 5 year average annual expenses are $60,000. This includes everything a new car purchase, major home repairs, and toys. I expect our costs to increase $39k in ER - due to Health insurance, entertainment, and taxes to cover income.
Every scenario I run in Firecalc says 100% success. I'm confused though when I consider a SWR. Due to retiring so early I read it should only be 3.5%. But to cover our annual ER expenses of $100, we would need $2.8 mil. I put in $120 a year in FIRE and it still says no problem, but a SWR would need $3.4mil?
I'm not counting on any SS or inheritance, just using the monies I estimate us to have right now. Not counting any monies from potential home sale, as we'd need the cash to buy another home.
Due to all the money being in pretax account, ER will require us to 72t our income. Which we want to do in order to stay in the 15% tax bracket. It's a bit scary to lock in 72t for 10+ years, but I don't see any other option.
Lots to consider and plan for, but it's so close I need to delve into the real nitty gritty.
Husband 46, Wife 45 - DINKS
Current pretax accounts $1.4 mil, after tax $255k, own home, no debt. Planning on receiving an estimated $1 mil in a profit share plan from employer in 2015. We intend to save and additional $250k, until ER in 2016.
Our 5 year average annual expenses are $60,000. This includes everything a new car purchase, major home repairs, and toys. I expect our costs to increase $39k in ER - due to Health insurance, entertainment, and taxes to cover income.
Every scenario I run in Firecalc says 100% success. I'm confused though when I consider a SWR. Due to retiring so early I read it should only be 3.5%. But to cover our annual ER expenses of $100, we would need $2.8 mil. I put in $120 a year in FIRE and it still says no problem, but a SWR would need $3.4mil?
I'm not counting on any SS or inheritance, just using the monies I estimate us to have right now. Not counting any monies from potential home sale, as we'd need the cash to buy another home.
Due to all the money being in pretax account, ER will require us to 72t our income. Which we want to do in order to stay in the 15% tax bracket. It's a bit scary to lock in 72t for 10+ years, but I don't see any other option.
Lots to consider and plan for, but it's so close I need to delve into the real nitty gritty.