I have been devouring the MMM site and the forums. What a wonderful place! I'm inspired by how well all you Mustachians are doing, but I must admit, I'm feeling a little overwhelmed.
By comparison, we're old, spend too much, and, I think, are drastically behind in our attempts to accumulate retirement savings. To be fair, our three biggest financial setbacks haven't resulted entirely from our own stupidity...one was a six-year custody battle (1991-1997) between my husband and his daughter's mother before we met, one was a failed business that we tried our damnedest to make succeed (2001-2002), and the last was the uninsured cost of the same daughter's care at a residential treatment facility (2006-2008, ~$100,000). We also had some unfortunate real estate timing, but that probably WAS due to our own stupidity.
So, I'd really like to assess where we are right now. I tried using the formula that arebelspy (clearly an individual whose intellect wildly exceeds my own) posted in another thread. Even after running to my 19-year-old for math help, it made my eyes glaze over and my head hurt.
If we just had regular investment accounts like 401(k)s, funds with balances, and cash sitting in the bank, I would feel better about understanding where we stand, and/or could use "calculators". Instead, we have:
* TSP and a 401(k), which we can access when my husband is 59 1/2. This has an obvious balance...got it.
* Cash in the bank...got it.
* Two rental houses with mortgages and positive cash flow...how do I know how to value these? Real estate values change wildly over time, and houses cost money to sell, so all the money wouldn't be ours if we liquidated.
* Our own house, which will be MUCH too big once all the kids leave the nest (youngest is 13), so we'll be selling and downsizing and keeping/investing the difference...same problem with quantifying what that means. I have no idea what that difference will be when the time comes, or even when "the time" is.
* Military (reserve) retirement, which with his particular years of service, he can start collecting when he is 56. The government gives us estimates of how much that payment will be, stated in today's dollars, but there is constantly some proposal in Congress to fiddle around with the cost of living increases or the payout start age, etc...I don't know how to incorporate that into our "total nest egg" figure, since it's a monthly amount, and one that can be changed at Congress's whim.
* VA disability payments...again, I know what they are right now, but not how they fit into the total "nest egg" calculation or how much the government will screw with them when budgets get squeezed.
* Soundness of the Social Security program aside, we won't reach eligibility at the same time, because my husband is 48 and I am 41. In fact, I keep running into this issue with retirement calculators...they ask for age, and I don't know which one to put in. He makes all the income, but obviously the money has to last through my old age as well, and I am younger.
So, how do I incorporate these things into an assessment? Please be gentle with me...I know I'm a lousy mathematician. In my defense, the other half of my brain is brilliant. :)