Reader Case Study = Stay the course or ???????
IRS Filing Status = Single, no dependents. 44, Utah (but would prefer Boise, ID)
Gross Salary = $75,821
Pre tax deductions
Retirement 23.25
TSP $145.32 (3778.32 annual)
Health Ins $118.12 (3071.12 annual)
Dental $11.52 (299.52 annual)
FSA 65.38 (1699.88 annual)
Post tax deductions
SSA $168.11
Life insurance $26.90 = term = $453,000 (11.70 for $78000 and 15.20 for a multiplier of annual salary)
Long term care $24.34
Union dues $16.08
Medicare $39.32
Rental Income
$800 (house #2)
$500 (house #1 = 1 roommate)
AGI 2017 $58640
Taxes
Fed $282.55/7346.30
State $127.02/3302.52
Current expenses
Mortgage $1641.67 (1415.47 P&I $226.20 T&I)
Mortgage $749.55 ($606.42 P&I $143.13 T&I)
Utilities house 1 $225
Utilities house 2 $138.50
Heloc $52
Car insurance $60
Phone $65
Costco membership $10
Amazon Prime $10
Gym $26 (prepaid in Jan)
Food $200
Assets
House 1 $365,000 current FMV Equity $87K
House 2 $205,000 current FMV Equity $83K
TSP $69882.33 8.8% rate of return (60% C; 20% G; 10% S; 10% I)
AK State retirement $64551 (12578.67 9.9% return; 35693.32 21.32% return)
ID State retirement $15745
Ed Jones $960 (basis $450, taxable, just some Verizon/frontier stock and cash)
529 $10465
Car $10572
Cash $7691
Total $349866.33
Liabilities
Mortgage 1 $278K at 4.5%
Mortgage 2 $108,784.47; 4.5%
HELOC $14429 (House 2)
Home Depot $1900 (no interest until 5/2019)
Total $403113.47
1. I live in House #1 and work in Utah but I’d rather live and work in House #2 Boise, ID. However, it’s unlikely that I can get a transfer so I’d have to explore self employment (which, if I can nail the clients, I’d double my gross income). I’m totally miserable in my current employment/location to the point where my work place stress is causing physical symptoms. I used to love my job but I started transferring to pursue promotions. Got them but now I just want to go home. Ugh.
2. House #2 is a $6200 loss on Sch E of which $3827 is depreciation.
3. What the hell to do w/ 529 plan when neither kid wanted to go to college?
4. Why do I hold onto this Ed Jones account?
5. I dropped my TSP contribution to the employer match in order to build up FU cash.
6. I’d have to work 17 more years to hit minimum retirement w/o a penalty at 62 and max the pay scale at $95,388.
7. If I quit then I can sell House 1, bank the equity/proceeds and erase upwards of $1900 off my monthly expenses and $278,000 off my balance sheet.
8. If I pursue self employment my monthly living expenses would be approx.. $500/mo as I’d keep the roomies currently in house #2 and bootstrap the new biz.
9. My current employer completely restricts my outside of work activity so side hustles are a no-go.
I started my federal career almost 10 years ago. It will be 10 years June 2019. From there it would be 15 years in order to retire with a federal pension at 60 and carry the federal health insurance into retirement (becomes secondary after reaching Medicare age). I have reached a midpoint in life and looking for 1)financial independence and 2)less stress in all areas of life so as to improve my quality of life in the 2nd half.