Hello everyone,
My wife and I would like to retire in 9 years from our 8-5 job and pursue our dream in flipping house.
Ages: 42 (Bread) & 41 (Tsong). Three kids (3,3, & 12)
Occupation: Engineer & Nurse
Household income including rental ($16K): $240K
Debt is $75K will be paid off in 3 years.
· Car 1 – $10K (interest 1.5%)
· Car 2 – $19K ((interest 1.75%)
· Solar – $16K (interest 5%)
· HVAC – $10K (Interest 0%)
· Personal loan – $20K (Interest 5%)
We own 2 properties and between our primary residence and rental property we have $570K of equity. Our remaining loan balance is $450K and it’s scheduled to be paid off by time we retire.
Our retirement balance is $619K deferred account. Our current contribution was reduced to $2K per month to ease some of the financial burden and will increase contributions as we pay off our debt and maxed out in three years.
We have $70K in college funds and $65K in stocks (20 individual stocks) that are dedicated for college expenses. We contribute about $500 a month to their college funds. The first few years college expenses of our eldest child will be paid out of our pocket since we’re still going to be working. We’re planning not to touch the college funds till we retire and will continue to contribute till the twins go to college.
Current total net worth is $1.25M
Our investments allocation including retirement accounts and college funds are invested 100% equity. I plan to change our retirement allocation 75/25 (equity/bonds & cash) when my wife turns 45. Our average investments return since we’ve started in 2002 has been about 8.9%.
We both work for government agencies and have a defined pension plan when we retire. Our approximate retirement income will be 55% of our salary, 30% will be from defined pension plan and other 25% will be generated from our retirement account which is based on a conservative calculation of 3.5% withdrawal rate. The 55% of our salary will generate about $10K gross a month not accounting for inflation. I’m also fortunate that our healthcare insurance for the whole family is a benefit I’ll be receiving if I retire with my current employer, my wife and I will have healthcare coverage till we turn 65 years old and our children will be covered till they turn 26.
The rental property will be our first home we’re going to flip to get our business started. The money from the first flip project will be rolled over to our next project. Income from retirement will not be utilize for the business.
Expected expenses during retirement per month not accounting for inflation:
· Property tax: $700
· College fund: $500
· Utilities: $1,100
· Car: $1,500 (Splurging)
· Taxes: $1,500 (based on federal & state tax brackets w/o child tax credit, very conservative)
· Disposable income: $4,700 (food, gas, vacation, misc.)
Seeking for advise:
· Is my goal reasonable?
· Is my current allocation too aggressive?
· Is there anything you would do differently?
· How to minimize tax during retirement?
My wife and I would like to retire in 9 years from our 8-5 job and pursue our dream in flipping house.
Ages: 42 (Bread) & 41 (Tsong). Three kids (3,3, & 12)
Occupation: Engineer & Nurse
Household income including rental ($16K): $240K
Debt is $75K will be paid off in 3 years.
· Car 1 – $10K (interest 1.5%)
· Car 2 – $19K ((interest 1.75%)
· Solar – $16K (interest 5%)
· HVAC – $10K (Interest 0%)
· Personal loan – $20K (Interest 5%)
We own 2 properties and between our primary residence and rental property we have $570K of equity. Our remaining loan balance is $450K and it’s scheduled to be paid off by time we retire.
Our retirement balance is $619K deferred account. Our current contribution was reduced to $2K per month to ease some of the financial burden and will increase contributions as we pay off our debt and maxed out in three years.
We have $70K in college funds and $65K in stocks (20 individual stocks) that are dedicated for college expenses. We contribute about $500 a month to their college funds. The first few years college expenses of our eldest child will be paid out of our pocket since we’re still going to be working. We’re planning not to touch the college funds till we retire and will continue to contribute till the twins go to college.
Current total net worth is $1.25M
Our investments allocation including retirement accounts and college funds are invested 100% equity. I plan to change our retirement allocation 75/25 (equity/bonds & cash) when my wife turns 45. Our average investments return since we’ve started in 2002 has been about 8.9%.
We both work for government agencies and have a defined pension plan when we retire. Our approximate retirement income will be 55% of our salary, 30% will be from defined pension plan and other 25% will be generated from our retirement account which is based on a conservative calculation of 3.5% withdrawal rate. The 55% of our salary will generate about $10K gross a month not accounting for inflation. I’m also fortunate that our healthcare insurance for the whole family is a benefit I’ll be receiving if I retire with my current employer, my wife and I will have healthcare coverage till we turn 65 years old and our children will be covered till they turn 26.
The rental property will be our first home we’re going to flip to get our business started. The money from the first flip project will be rolled over to our next project. Income from retirement will not be utilize for the business.
Expected expenses during retirement per month not accounting for inflation:
· Property tax: $700
· College fund: $500
· Utilities: $1,100
· Car: $1,500 (Splurging)
· Taxes: $1,500 (based on federal & state tax brackets w/o child tax credit, very conservative)
· Disposable income: $4,700 (food, gas, vacation, misc.)
Seeking for advise:
· Is my goal reasonable?
· Is my current allocation too aggressive?
· Is there anything you would do differently?
· How to minimize tax during retirement?