Bogleheads’ advice, hard work, and a strong market have boosted my confidence and improved my portfolio.
After another journey around the sun, I have another request for your invaluable assistance.
Questions:
1.Portfolio review and recommendations?
2.What is your analysis of my assumptions?
3.My math indicates that I could retire at the end of this year, at age 68, meet my retirement expense estimates, and file for social security at age 70. What am I missing?
PORTFOLIO as of January 2025:
Emergency funds: $15k in bank savings account
Debt: No debt
Tax Filing Status: Married Filing Jointly
Tax Rate: 37% Federal (plus NIT), 6.85% State, 3.85% City
State of Residence: NY
Residence: Owned co-op, no mortgage
Age: Him 67 (working full-time), her 63 (retired)
Retirement Expenses: $230,000 (pre-tax); $200,000 (after tax); includes $2k/month for medical expenses. Taxes are calculated using Maxifi and Fidelity tools.
Social Security: Him $4.8k/mo. (planned at 70), her $3.2k/mo. (planned at 67). $96k annual.
Pensions: N/A
Desired Asset allocation: 60% stocks / 40% fixed
International allocation: Negligible
Total portfolio: $4.2M
Current retirement assets
50% Taxable
40% Tax Deferred
10% Tax Exempt
Taxable Brokerage
31.4% Fidelity SP500 Index Funds, FXAIX (ER 0.02%)
9.4% Short-Term Treasury Bills, rolling.
6.6% Vanguard NY Muni Fund Long, VNYTX (ER 0.17%)
0.6% NY Muni MMF, FSNXX
0.3% Premium Class Money Market, FZDXX
His 401k
11.8% iShares U.S. Aggregate Bond Index Fund, WFBIX (ER 0.05%)
6.3% Fidelity SP500 Index Funds, FXAIX (ER 0.02%)
His Roth IRA
6.1% Fidelity SP500 Index Funds, FXAIX (ER 0.02%)
His Rollover IRA
3.0% Fidelity SP500 Index Funds, FXAIX (ER 0.02%)
3.1% Fidelity Total Bond, FXNAX (ER 0.02%)
1.6% Premium Class Money Market, FZDXX
1.2% 3-year Treasury Note
1.2% 5-year Treasury Note
His I-Bonds
1.3%
His Non-Qualified Annuity
1.0% 4.0% interest guaranteed for life
Her traditional IRA
9.0% Fidelity Puritan Fund (70% Eq), FPURX (ER 0.51%)
Her Roth IRA
3.9% Fidelity SP500 Index Funds, FXAIX (ER 0.02%)
Her Inherited IRA
0.4% 2-year Treasury Notes
0.2% Fidelity Total Bond, FXNAX (ER 0.02%)
Her I-Bonds
1.3%
________________________________
2025 Annual Contribution, estimate: $300k
$250k his taxable
$30k his 401k
$10k his iBonds
$10k her iBonds
2026 February, final bonus $450k ($230k net after tax).
-----------
Retirement Assumptions:
Expenses: $230,000 (pre-tax); $200,000 (after tax); taxes calculated using Maxifi and Fidelity tools.
Expenses were calculated using two methods: my actual itemized spending for 2022/23/24 (taxes adjusted) and @KlangFool’s formula Expenses = Gross Income – Taxes – Savings.
Medicare B + Medicare G-HD + Medicare Part D drug for two people in NYC (including deductibles and out-of-pocket expenses) = budgeted at $2,000 per month and included in “expenses” above.
Social Security: based on life expectancy and OpenSocialSecurity recommendation.
Him $4.8k/mo. (planned at 70), DW $3.2k/mo. (at 67) = $8.0k/mo. = $96k/yr. pre-tax.
Retirement Withdrawals, SWR and VPW:
$230k gross expenses - $96k SS = $134k net withdrawal needed annually to cover expenses.
Portfolio:
$4.2M Jan 2025 + $300k (2025 contribution) = $4.5M
RETIRE - December 2025
$4.5M Jan 2026 + $230k (2026 final bonus, after tax) - $230k (2026 expenses) = $4.5M
$4.5M Jan 2027 - $230k (2027 expenses) = 4.2M
$4.2M Jan 2028 at start of social security
134/4200 = 3.2%
1/3.2 = 31.3
134 * 31.3 = $4.2M
Therefore, 3.2% SWR benchmark, 31.3X Expenses.
I plugged my data into the VPW worksheet:
Using a 2028 scenario, $4.2M portfolio, and social security at $8k/mo.; VPW suggests a 5.13% withdrawal rate, “detailed income” at $312k, and “detailed income after loss” at $247k.
I reran VPW with Social Security at 79%: “detailed income” at $292k and “detailed income after loss” at $227k.
I should be okay to retire at the end of this year, 2025.
I intend to self-fund LTC.
More human capital would be better… financially.
Thank you. Happy New Year.
Your feedback, as always, is much appreciated.
After another journey around the sun, I have another request for your invaluable assistance.
Questions:
1.Portfolio review and recommendations?
2.What is your analysis of my assumptions?
3.My math indicates that I could retire at the end of this year, at age 68, meet my retirement expense estimates, and file for social security at age 70. What am I missing?
PORTFOLIO as of January 2025:
Emergency funds: $15k in bank savings account
Debt: No debt
Tax Filing Status: Married Filing Jointly
Tax Rate: 37% Federal (plus NIT), 6.85% State, 3.85% City
State of Residence: NY
Residence: Owned co-op, no mortgage
Age: Him 67 (working full-time), her 63 (retired)
Retirement Expenses: $230,000 (pre-tax); $200,000 (after tax); includes $2k/month for medical expenses. Taxes are calculated using Maxifi and Fidelity tools.
Social Security: Him $4.8k/mo. (planned at 70), her $3.2k/mo. (planned at 67). $96k annual.
Pensions: N/A
Desired Asset allocation: 60% stocks / 40% fixed
International allocation: Negligible
Total portfolio: $4.2M
Current retirement assets
50% Taxable
40% Tax Deferred
10% Tax Exempt
Taxable Brokerage
31.4% Fidelity SP500 Index Funds, FXAIX (ER 0.02%)
9.4% Short-Term Treasury Bills, rolling.
6.6% Vanguard NY Muni Fund Long, VNYTX (ER 0.17%)
0.6% NY Muni MMF, FSNXX
0.3% Premium Class Money Market, FZDXX
His 401k
11.8% iShares U.S. Aggregate Bond Index Fund, WFBIX (ER 0.05%)
6.3% Fidelity SP500 Index Funds, FXAIX (ER 0.02%)
His Roth IRA
6.1% Fidelity SP500 Index Funds, FXAIX (ER 0.02%)
His Rollover IRA
3.0% Fidelity SP500 Index Funds, FXAIX (ER 0.02%)
3.1% Fidelity Total Bond, FXNAX (ER 0.02%)
1.6% Premium Class Money Market, FZDXX
1.2% 3-year Treasury Note
1.2% 5-year Treasury Note
His I-Bonds
1.3%
His Non-Qualified Annuity
1.0% 4.0% interest guaranteed for life
Her traditional IRA
9.0% Fidelity Puritan Fund (70% Eq), FPURX (ER 0.51%)
Her Roth IRA
3.9% Fidelity SP500 Index Funds, FXAIX (ER 0.02%)
Her Inherited IRA
0.4% 2-year Treasury Notes
0.2% Fidelity Total Bond, FXNAX (ER 0.02%)
Her I-Bonds
1.3%
________________________________
2025 Annual Contribution, estimate: $300k
$250k his taxable
$30k his 401k
$10k his iBonds
$10k her iBonds
2026 February, final bonus $450k ($230k net after tax).
-----------
Retirement Assumptions:
Expenses: $230,000 (pre-tax); $200,000 (after tax); taxes calculated using Maxifi and Fidelity tools.
Expenses were calculated using two methods: my actual itemized spending for 2022/23/24 (taxes adjusted) and @KlangFool’s formula Expenses = Gross Income – Taxes – Savings.
Medicare B + Medicare G-HD + Medicare Part D drug for two people in NYC (including deductibles and out-of-pocket expenses) = budgeted at $2,000 per month and included in “expenses” above.
Social Security: based on life expectancy and OpenSocialSecurity recommendation.
Him $4.8k/mo. (planned at 70), DW $3.2k/mo. (at 67) = $8.0k/mo. = $96k/yr. pre-tax.
Retirement Withdrawals, SWR and VPW:
$230k gross expenses - $96k SS = $134k net withdrawal needed annually to cover expenses.
Portfolio:
$4.2M Jan 2025 + $300k (2025 contribution) = $4.5M
RETIRE - December 2025
$4.5M Jan 2026 + $230k (2026 final bonus, after tax) - $230k (2026 expenses) = $4.5M
$4.5M Jan 2027 - $230k (2027 expenses) = 4.2M
$4.2M Jan 2028 at start of social security
134/4200 = 3.2%
1/3.2 = 31.3
134 * 31.3 = $4.2M
Therefore, 3.2% SWR benchmark, 31.3X Expenses.
I plugged my data into the VPW worksheet:
Using a 2028 scenario, $4.2M portfolio, and social security at $8k/mo.; VPW suggests a 5.13% withdrawal rate, “detailed income” at $312k, and “detailed income after loss” at $247k.
I reran VPW with Social Security at 79%: “detailed income” at $292k and “detailed income after loss” at $227k.
I should be okay to retire at the end of this year, 2025.
I intend to self-fund LTC.
More human capital would be better… financially.
Thank you. Happy New Year.
Your feedback, as always, is much appreciated.
Statistics: Posted by Indeterminacy — Sun Jan 05, 2025 11:59 am — Replies 0 — Views 92