Possible Forced Retirement. Step 1, Need Assistance in 401k Rollover

[Rianne]

Just curious as you mention you also try to be frugal, like us. What stood out between my "back of the napkin" expense and your own?

CA property taxes are low. Comparing a few expenses:
No debt

Life Insurance: $83
Homeowner/car insurance: $200
Property taxes: $492
TV/Cell/Internet/landline: $265
YMCA membership: $75
Food: $600
Vacation: $300
Utilities: $400 (water, energy, garbage removal)
Clothes: $50
Medical: $663 (have HSA high deductible/includes dental)
Dog: $83 (Pet insurance expensive)
Cars/gas: $90 - Camry 1997 (@180,000 mi) Camry 2004 (@290,000 mi)
Amazon: $400 various needs
Home maintenance: approx $40
Cash $400

Total as far as I figure: $4141 - OK you got me, maybe we're not THAT frugal. I have to figure out where the rest of that $$ is going

 

[target2019]

Uber driver? Probably not.
https://www.moneyunder30.com/driving-for-uber-or-lyft

HomeDepot or Lowes (just stand around and shoot the breeze)?. Get a discount and flexible hours. Lol.

Anyways, enjoy the sunshine while it lasts...

 

[pb4uski]

I'm late to the party, but to begin with you have WAY too many funds.

What I would do is to rollover the 401k to your Vanguard IRA and put your whole Vanguard IRA in Wellesley. Wellesley is ~60% bonds and your IRA and 401k combined are ~50% of your nestegg... so together that would give you ~30% of the 35% that you want for bonds in total and you get the bond expertise of Wellesley. Fixed income has been a tough area for many of us these days and you are inexperienced in it so you would just be subcontracting most of your fixed income to Wellesley's fixed income managers who have a pretty good track record.

For the Roth's, I would put them all in a total domestic stock fund like Vanguard Total Stock or similar.

For the taxable account, I would also simplify those keeping in mind staying within the 0% capital gains tax bracket. I would put all my international equities in the taxable account so you can take full advantage of the foreign tax credit... which is wasted for international equities in tax-deferred or tax-free accounts. I would then hold 5% of the total (~$75k) in something like Vanguard Prime MM Fund (VMMXX), which currently pays about 2.4% and would be your liquidity stash. Between the 30% of bonds covered off by Wellesley your IRA/401k and 5% in VMMXX that will be your 35% in bonds/fixed income. Then whatever remaining room is left in taxable would be for total stock (where dividends and LTCG are tax free is you stay within the 0% capital gains tax bracket).

Then once you have that set, you can do low-cost Roth conversions to the top of the 0% capital gains tax bracket until you are 59 1/2 and then either IRA withdrawals or Roth conversions to extract as much as possible from your IRA before pensions and SS start.

You may have an issue with respect to penalty-free access to money for living expenses until you are 59 1/2, perhaps not... you would have to schedule it out year by year... but if ther is a liquidity gap you can always start a 72t to fill the gap or use Roth money or even a HELOC or cash-out refinance of your paid-off home to provide temporary liquidity and then pay it back once you are 59 1/2.

 

[JustKickItForward]

CA property taxes are low. Comparing a few expenses:
No debt

Life Insurance: $83
Homeowner/car insurance: $200
Property taxes: $492
TV/Cell/Internet/landline: $265
YMCA membership: $75
Food: $600
Vacation: $300
Utilities: $400 (water, energy, garbage removal)
Clothes: $50
Medical: $663 (have HSA high deductible/includes dental)
Dog: $83 (Pet insurance expensive)
Cars/gas: $90 - Camry 1997 (@180,000 mi) Camry 2004 (@290,000 mi)
Amazon: $400 various needs
Home maintenance: approx $40
Cash $400

Total as far as I figure: $4141 - OK you got me, maybe we're not THAT frugal. I have to figure out where the rest of that $$ is going

For me, rest of the $$$ goes to what I call "Other junk" and "Fluff" in the expenses writeup I provided. Since I have used a popular finance software for over 25 yrs (for both him and her) to track my actual spend (within +/- 2%), I know my actual monthly spend for any given timeframe (like I ran a report for the past seven yrs and monthly spend average somewhere around $5100/mo, so I know I use up my "Other junk" and "Fluff" categories. If I really wanted, I can run reports and know on a monthly basis where the Fluff and Other Junk spend goes, but it is not worth my time because that spend varies each month (e.g. one month, it includes one time home repair job, another month it is is DW's visit to Target for shopping supplies and back to school clothing for the kids, another month it is one time electronic purchase, etc.).


A couple of notes. I hate "cash" (like you have, also you have "Amazon" as a category) and "misc" category, these types of spend categories leave so much room to losing track of what you spend on, if you really want to know that sort of detail. A couple of ways I have kept my "TV/Cell/Internet/landline" category at bay (my cost for that is approx $220/mo), and this includes five unlimited data mobile devices for four of us (one extra fun device for me), is got rid of the landline over 7 yrs ago (replaced with GoogleVoice and Obihai device), is to 'share' where possible. For example I rent out several lines on my cell phone acct and that reduces our per line costs. Our life insur is around $250 for two of us (higher than yours), I did not count medical on mine bc DW's work covers that, and we use the FSA to cover out of pocket costs.

 

[JustKickItForward]

Uber driver? Probably not.
https://www.moneyunder30.com/driving-for-uber-or-lyft

HomeDepot or Lowes (just stand around and shoot the breeze)?. Get a discount and flexible hours. Lol.

Anyways, enjoy the sunshine while it lasts...

LOL HD and Lowes have come up many time, maybe I should look into that.


Uber, not for me, but one driving job I referred to in my earlier post is Dryver. I know at least two people doing that now, and they love it ! It sounded interested to me, aside from meeting new people, one of the best things about that job is in between drops, I would likely have a decent amount of free time to myself.