Author Topic: Hoping to FIRE by 2020 (or before)  (Read 644 times)

FIby2020

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Hoping to FIRE by 2020 (or before)
« on: February 03, 2018, 06:46:41 AM »
Life Situation: Myself 57, male, wife 58,  Married 37 years no kids,  (2 elderly horses, elderly cats and dog)

Gross Salary/Wages: 130,000 my salary (same employer for 40 years), wife has (non life threatening chronic) pain issues.

Investments:  $850,000:  403b (525,000), Roths (41,000) , Pension (170,000) (if taken lump sum, elig. after Jan. 2016) Cash - $110,000 (cash includes unexpected $70,000 inheritance in 2017), contributing 40k / year into 403b, and 13k into Roths

House:   $300,000 (according to Zillow),  No mortgage.  Property taxes: $3,600 per year, live in very rural new england), purchased new 30 years ago, well maintained.

Cars No payment: Cars 2004 Volvo (will last forever  ~100k mi. like new), 2013 volvo ( under 40k mi.) purchased wrecked and had it rebuilt professionally), Maint. can be expensive but have longtime volvo autobody / service shop almost next door).  Work commute is 20 mi. one way.

No Debt

Current expenses (approx. 2017 spending. Started detailed tracking to nail down accuracy / future estimates)
Category                    Annual
Groceries                    8,000
Pets (food/Vet)              5,500
Prop. tax                    4,000
Auto (insurance/maint)        3,400
Vacation                     3,000
Household                    2,800
Gas                          2,400
Electric                     2,400
Heating                      2,300
Internet/landline            1,400
Dining                       1,500
Gardening est.               1,200
Cycling est.                 1,200


I am looking to retire as soon as possible but original long term plan has been potentially March 2020 (@59 1/2)  (no health issues), 40 years in IT / software development background. I Have cheap excellent health insurance through employer currently.   Incredible $0 deductible health plan after as well (but will be expensive  at 12k per year at retirement.).  I know ACA is a possibility and looks like subsidy is possible for income < 60k per year.

Specific Question(s): 


   1. Looking to retire no later than March 2020, but would consider 2018 (or 2019) if I was more confident in my future expenses /  tracking. Has anyone else done this with similar age / numbers / lifestyle?  Any words of wisdom on before or after?  I am open to hearing on places to cut expenses somehow as well.
   2. Another big question is what mix of funds would I draw down first (and do I have enough to get to full social security benefits.  On the surface my current thinking is to delay social security as long as possible (looks like it would be something like $50k per year for our combined benefits when I reach 67). 
   3. Winters are long and cold here (especially this year), and would consider part-time work from home in winter (after a long break of a year or two away from work).  Light (i.e. part-time) software development / web development a possibility but need to learn more up to date technology. Moving to a warmer climate is out of the question, unless I want  to move alone :-)  Again has anyone had experience in this area perhaps after learning more up to date technology after being away from it for a few years?


I will also start devouring this forum for more information as well,  This  is an incredible resource.  Thank you all in advance.
« Last Edit: February 03, 2018, 07:25:13 AM by FIby2020 »

2Birds1Stone

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Re: Hoping to FIRE by 2020 (or before)
« Reply #1 on: February 03, 2018, 12:58:53 PM »
My back of the napkin math shows that your spending would be ~$52k/yr including the $12k/yr health insurance premium through your employer.

Have you calculated what your and wifes SS will be at FRA?

Let's assume you take SS @ 65, and the market returns 0% real over the next 7 years.

You would burn ~$350k of your stache before collecting SS.

Now you have ~$500k, which you can draw down $20k/yr into perpetuity, and your $12k/yr health premiums likely drop down due to being FRA.

Will SS more than cover the delta in spending? If you are planning on collecting $25-35k/yr in SS between yourself and wife, you are golden.

If you can earn some side income and reduce the drawdown in the years before SS, your plan pretty much has no chance of failing (aside from some catastrophic event that sucks up your funds)

Do you really dislike your job? Do you have something to retire to? Would your company consider letting you go part time, or consult to bridge the gap for a few years?

"A small house can hold as much happiness as a big one." - Fortune Cookie

24 Months till FI - Stop by, or stay a while.....
https://forum.mrmoneymustache.com/journals/fire-by-thirty-five-chronicles-36-months-till-sabbatical!/

2Birds1Stone

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Re: Hoping to FIRE by 2020 (or before)
« Reply #2 on: February 03, 2018, 12:59:58 PM »
Just to clarify, this is assuming you retired right now.

If you keep your expenses as stated ~$40k/yr and bank $50+k/yr over the next 2 years, your chance of success on FIRECALC is pretty much 100%.
"A small house can hold as much happiness as a big one." - Fortune Cookie

24 Months till FI - Stop by, or stay a while.....
https://forum.mrmoneymustache.com/journals/fire-by-thirty-five-chronicles-36-months-till-sabbatical!/

FIby2020

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Re: Hoping to FIRE by 2020 (or before)
« Reply #3 on: February 04, 2018, 06:49:12 AM »
My back of the napkin math shows that your spending would be ~$52k/yr including the $12k/yr health insurance premium through your employer.

Have you calculated what your and wifes SS will be at FRA?

Do you really dislike your job? Do you have something to retire to? Would your company consider letting you go part time, or consult to bridge the gap for a few years?

Assuming my numbers are right (based on my SS statement and some work in a spreadsheet), our SS  combined would be  (Beginning Sept each year Yr/Age=amount)  2022/62=$32k; 2023/63=$35k, 2024/64=$38k; 2025/65=$42k; 2027/67= $51k.

There will be many changes this year that will be good for the organization, but will not be favorable for what I like to do, so I am mostly just planning for the possibility of that becoming less fulfilling.  Knowing that I am in reach to retire is of course very satisfying.  Within 2 years, the technical work I like to do, is likely to dry up anyway, so 59 1/2 (spring 2020) may be perfect timing, so this is more of planning ahead. Part-time is highly unlikely since i am part of a small technical team that covers 24-7 at a large hospital.

I have many interests, cycling fanatic, gardening (in a big way),  and barely have enough time for those activities.

Thank you for your response.  I also look forward to reading your many many posts further as you have several more years of thought and planning into this (new-ish) FIRE world at least for me.
« Last Edit: February 04, 2018, 12:47:01 PM by FIby2020 »

JacobEhrgott

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Re: Hoping to FIRE by 2020 (or before)
« Reply #4 on: February 04, 2018, 07:02:00 AM »
Seems like your in a really good place especially since your not that far from SS and have no mortgage. You said elderly pets too and they are a large expense in your budget. Will you be getting new pets after or if not that frees up a lot of capital at some point as well. Grind out two more years you’ll be in great shape!

Linda_Norway

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Re: Hoping to FIRE by 2020 (or before)
« Reply #5 on: February 04, 2018, 07:30:23 AM »
DH and I are a bit in a similar situation to you. We had already saved quite a lot each year without being Mustachian and a year ago we found out that we are not so far from FIRE. 2020 is our goal as well, preferably with parttime working in 2019, if we have built up enough stash.

I am also in software, as a tester/test manager. I am not sure at all if I want to do that as a consultant after FIRE. I think my current employer would hire me, as they require special subject expertise, but that would require me to keep living in this area. And we plan to live somewhere else in the country closer to our outdoor hobbies.

I am currently tracking my expenses in detail. And DH and I checked our total expenses in 2016 and 2017. In 2016, with tracking and Mustachianism, we save 60%, amd in 2017, with tracking my half and being Mustachian, we saved 75%. Originally we thought FIRE would require $ 50.000 USD per year (roughly dividing my Norwegian crown number by 10). In 2017 we spent only  $ 28.000. I still think that 2017 was an extremely cheap year where we didn't have major expenses. So until now we have kept our spending goal in FIRE at $ 50.000 a year, so that we have a margin. If I change that parameter in my excel sheet to 45.000, we could likely FIRE at the start of 2019. So the question is, how much margin would you like? We are now thinking of a trip to south America, which will coat a lot more than we have ever spent on a vacation. Therefore it is good to not have a barebones FIRE budget. Maybe we would like to do some more travelling in the future. As we get older, we might prefer to sleep in a bed instead of in a tent. I also think the high cost of heathcare in Norway, currently paid for by the government is not sustainable in the future. So I count on having to buy our own health insuranfe in the future, after a European model. Good to have the means for that.