Context:
Contrary to user-name, our financial goal gravitates around having "enough". Living comfortably (without worry to cover expenses) > living extravagantly.
Target retirement in 2.5 years / mid 2027. The financial planning model that we use suggests that we are blessed, as the most pessimistic scenario (“significantly below market” / 90% probability of success across Monte Carlo) assumptions reflect, with confidence, that we will:
(1) Meet all retirement expenses (essential + discretionary) through her 93yo (God-willing)
(2) Maintain existing lifestyle (adjusted for empty nest) + anticipated retirement healthcare costs
(3) Not exceed the 4% rule
Our retirement financial strategy:
- Retire in 2.5-years at his 57yo and her 55yo
- Live off 401k + retirement funds until he turns 65yo (his pension commences + her SS commences (62yo); His SS commences at 70yo)
- We wish to:
(1) Live the same lifestyle as pre-retirement (adjusted for empty nest + 3X healthcare costs but no LT care program) - est. 175k annually (incl taxes)
(2) Build new home for our retirement
With much respect for the financial knowledge on this site, we thank you in advance.
Questions, please:
1. Seeking Boglehead conservative lens to validate or challenge:
a. Do you agree with our financial planning model projected outcome – covering $175k expenses through her 93yo?
b. What could/should be improved?
2. We wish to build new home (sell existing) for retirement of est. $1.2M. Can we afford to do so? 2 options:
- Pay full cash: incl. est. $350k equity from existing home at retirement + $850k taxable accounts (likely at his 59yo and her 57yo, 2 years into retirement). Hopeful for severance $ that will be used in place of taxable accounts.
OR
- Keep similar mortgage: incl. $250k mortgage + $350k equity from existing home + $600k taxable accounts
Emergency funds = $71k (covers 6-months of pre-retirement expenses): Vanguard – Cash Reserves Federal Money Market (VGMRXX) = $25k +
Treasury Direct (I-Bonds) = His = $23k, Hers $23k
College 529 = $0.18M (HS aged child to enter college Fall 2025). Anticipated costs to not exceed 529.
Debt = $0 credit card, $0 school loans, $0 car loans; Home value est. $600k at $260k mortgage at 2.8% interest rate
Tax Filing Status = Married Filing Jointly
State of Residence = AL
Age = 54yo, wife 52yo
Desired Asset allocation: 67% stocks, 27% bonds, 6% cash equivalents
Total Portfolio = $4.1M
Taxable = $1.2M (24%)
• Vanguard Lifestrategy Growth fund (VASGX, 0.14% ER) = $0.23M (5%)
• Vanguard Information Technology Index ETF (VGT, 0.10% ER) = $0.23M (6%)
• Vanguard Total Stock Market Index ETF (VTI, 0.03% ER) = $0.22M (6%)
• Fidelity - Individual Stocks = $0.12M (Employer stock) (2%)
• E-Trade - Individual Stocks AAPL, NVDA, TSLA, Google, and AMZN = $0.24M (4%)
• Company stock options = $0.23M (4%)
Retirement = $2.9M (77%)
401k - Fidelity - Life 2030 (0.045% ER) = $2.4M (63%)
His Vanguard Roth – Total Stock Market Index Fund – Admiral (VTSAX, 0.04% ER) = $0.15M (4%)
Her Vanguard 403B – Lifestrategy Conservative Growth (VSCGX, 0.12% ER) = $0.14M (4%)
Her Vanguard Rollover IRA - Lifestrategy Conservative Growth (VSCGX, 0.12% ER) = $0.15M (4%)
Her Vanguard SEP IRA - Total Stock Market Index Fund – Admiral (VTSAX, 0.04% ER) = $0.03M (1%)
Her Vanguard Roth - Total Stock Market Index Fund – Admiral (VTSAX, 0.04% ER) = $0.07M (1%)
Contributions - New Annual Contributions:
401k - Fidelity Life 2030 = $31k his annual contributions + $42k annual company contributions
(portion of company contributions to acct for exceeding compensation limits, paid as lump sum at retirement)
His Vanguard Roth - Vanguard Life Strategy Growth fund (VASGX) VTSAX = $7.5k via backdoor conversion
Taxable:
• Vanguard Cash Reserves Federal Money Market (VGMRXX) (Rainy Day Fund) = $12k
• Vanguard Life Strategy Growth fund (VASGX) = $31k
• Vanguard Total Stock Market Index ETF (VTI) = $18k
• Fidelity - Individual Stocks – employer stock + Individual stocks = $30-60k annually. From discretionary portion of annual bonus. Objective is to keep employer stock value 3% max of total portfolio; incremental difference used to individual stocks.
Pension & Social Security (in today’s dollars):
Pension = est. to receive $115k annually starting at his reaching 65yo
SS (Hers) = est. to receive $22k annually starting at her reaching 62yo
SS (His) = est. to receive $44k annually starting at his reaching 70yo
Other:
Potential severance $ to exit from company that will trigger retirement at 57yo = $700k
Contrary to user-name, our financial goal gravitates around having "enough". Living comfortably (without worry to cover expenses) > living extravagantly.
Target retirement in 2.5 years / mid 2027. The financial planning model that we use suggests that we are blessed, as the most pessimistic scenario (“significantly below market” / 90% probability of success across Monte Carlo) assumptions reflect, with confidence, that we will:
(1) Meet all retirement expenses (essential + discretionary) through her 93yo (God-willing)
(2) Maintain existing lifestyle (adjusted for empty nest) + anticipated retirement healthcare costs
(3) Not exceed the 4% rule
Our retirement financial strategy:
- Retire in 2.5-years at his 57yo and her 55yo
- Live off 401k + retirement funds until he turns 65yo (his pension commences + her SS commences (62yo); His SS commences at 70yo)
- We wish to:
(1) Live the same lifestyle as pre-retirement (adjusted for empty nest + 3X healthcare costs but no LT care program) - est. 175k annually (incl taxes)
(2) Build new home for our retirement
With much respect for the financial knowledge on this site, we thank you in advance.
Questions, please:
1. Seeking Boglehead conservative lens to validate or challenge:
a. Do you agree with our financial planning model projected outcome – covering $175k expenses through her 93yo?
b. What could/should be improved?
2. We wish to build new home (sell existing) for retirement of est. $1.2M. Can we afford to do so? 2 options:
- Pay full cash: incl. est. $350k equity from existing home at retirement + $850k taxable accounts (likely at his 59yo and her 57yo, 2 years into retirement). Hopeful for severance $ that will be used in place of taxable accounts.
OR
- Keep similar mortgage: incl. $250k mortgage + $350k equity from existing home + $600k taxable accounts
Emergency funds = $71k (covers 6-months of pre-retirement expenses): Vanguard – Cash Reserves Federal Money Market (VGMRXX) = $25k +
Treasury Direct (I-Bonds) = His = $23k, Hers $23k
College 529 = $0.18M (HS aged child to enter college Fall 2025). Anticipated costs to not exceed 529.
Debt = $0 credit card, $0 school loans, $0 car loans; Home value est. $600k at $260k mortgage at 2.8% interest rate
Tax Filing Status = Married Filing Jointly
State of Residence = AL
Age = 54yo, wife 52yo
Desired Asset allocation: 67% stocks, 27% bonds, 6% cash equivalents
Total Portfolio = $4.1M
Taxable = $1.2M (24%)
• Vanguard Lifestrategy Growth fund (VASGX, 0.14% ER) = $0.23M (5%)
• Vanguard Information Technology Index ETF (VGT, 0.10% ER) = $0.23M (6%)
• Vanguard Total Stock Market Index ETF (VTI, 0.03% ER) = $0.22M (6%)
• Fidelity - Individual Stocks = $0.12M (Employer stock) (2%)
• E-Trade - Individual Stocks AAPL, NVDA, TSLA, Google, and AMZN = $0.24M (4%)
• Company stock options = $0.23M (4%)
Retirement = $2.9M (77%)
401k - Fidelity - Life 2030 (0.045% ER) = $2.4M (63%)
His Vanguard Roth – Total Stock Market Index Fund – Admiral (VTSAX, 0.04% ER) = $0.15M (4%)
Her Vanguard 403B – Lifestrategy Conservative Growth (VSCGX, 0.12% ER) = $0.14M (4%)
Her Vanguard Rollover IRA - Lifestrategy Conservative Growth (VSCGX, 0.12% ER) = $0.15M (4%)
Her Vanguard SEP IRA - Total Stock Market Index Fund – Admiral (VTSAX, 0.04% ER) = $0.03M (1%)
Her Vanguard Roth - Total Stock Market Index Fund – Admiral (VTSAX, 0.04% ER) = $0.07M (1%)
Contributions - New Annual Contributions:
401k - Fidelity Life 2030 = $31k his annual contributions + $42k annual company contributions
(portion of company contributions to acct for exceeding compensation limits, paid as lump sum at retirement)
His Vanguard Roth - Vanguard Life Strategy Growth fund (VASGX) VTSAX = $7.5k via backdoor conversion
Taxable:
• Vanguard Cash Reserves Federal Money Market (VGMRXX) (Rainy Day Fund) = $12k
• Vanguard Life Strategy Growth fund (VASGX) = $31k
• Vanguard Total Stock Market Index ETF (VTI) = $18k
• Fidelity - Individual Stocks – employer stock + Individual stocks = $30-60k annually. From discretionary portion of annual bonus. Objective is to keep employer stock value 3% max of total portfolio; incremental difference used to individual stocks.
Pension & Social Security (in today’s dollars):
Pension = est. to receive $115k annually starting at his reaching 65yo
SS (Hers) = est. to receive $22k annually starting at her reaching 62yo
SS (His) = est. to receive $44k annually starting at his reaching 70yo
Other:
Potential severance $ to exit from company that will trigger retirement at 57yo = $700k
Statistics: Posted by Most Points Wins — Sat Dec 28, 2024 12:18 pm — Replies 0 — Views 66