no debt, barely maxing 457 and IRA now what?

[getmoneyeatpizza]

I have no debt other than mortgage. I'm 32 and make 60k a year. I can just barely afford to max my 457 and IRA so I am putting away 23500 a year away into retirement. So now what? I still probably can't retire until I am 50 at this rate? I feel like I am working hard to save but seems like its not getting me much.

If I stay at my job another 26 years I can retire at 58 with 50% of my salary which I hope is a lot higher then. If I choose early retirement at 50 I get 37% of salary but the pension would not kick in until 17 years later when I am 67 and I lose 17 years of inflation as there is no cost of living increase until then. I wan to retire earlier but it seems like I at least need to get to 50.

Heres what I have now:

I have 40,000 in taxable vanguard VTSAX.
$67,000 in 457 90% stock index 10% bonds
$17,000 IRA target date 2040

Any advice on how to retire earlier?

[MDM]

Your calculations may (or may not) be pessimistic.  E.g.,

Quick calculation of "Time to FI"
Planned Withdrawal Rate	WR	4.0%
Annual Savings Invested	S	$23,500	$/yr
Annual Retirement Expenses	E	$27,400	$/yr
Current Assets Invested	A	$124,000	$
Investment return	r_	5.0%
Time to FI	t	13.6	yr

...and that doesn't include your pension. :)

[Gone Fishing]

Just keep doing what you are doing!  Your are certainly making progress! In the meantime keep an eye out for higher paying positions, promotions, raises, etc.  Several times I have been pretty sure I was maxed out salary wise, but then another door would open and I'd walk through it.  Every time, my pessimistic (no increase in pay) projections got better and better.   If you really want to get aggressive, post a case study, I'm sure we can find some fat!  Also, when you get to a point where you think everything is optimized pretty well, give yourself a break.  Keep your good habits, but don't look at your accounts or dwell on retirement for up to a year at a time.  There is a lot of living to be done before now and then.  Set some other goals like fitness goals, local travel, etc.

[Teacherstache]

I'm sure you already know this, but the truly awesome thing about a 457 plan is that you can begin withdrawing from it with no penalty as soon as you leave that place of employment. That will really help if you want to ER.

[Retired To Win]

... Any advice on how to retire earlier?

When you can retire is not just a function of how much you make, or how much you are able to sock away.  It's also just as much a function of how much you need to fund your expenses in retirement.

If you go by the 4% SWR "rule", you'll need $25,000 piled up to fund $1000 of annual expenses.  Turn that around and for every $1000 that you can lower your basic living expenses you will need to accumulate $25,000 LESS.

So that's what you can work on now.  Lower your living expenses and you will be able to retire sooner.

Good luck.

[johnny847]

... Any advice on how to retire earlier?

When you can retire is not just a function of how much you make, or how much you are able to sock away.  It's also just as much a function of how much you need to fund your expenses in retirement.

If you go by the 4% SWR "rule", you'll need $25,000 piled up to fund $1000 of annual expenses.  Turn that around and for every $1000 that you can lower your basic living expenses you will need to accumulate $25,000 LESS.

So that's what you can work on now.  Lower your living expenses and you will be able to retire sooner.

Good luck.
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To pile on....


Yup! Cutting your expenses is doubly effective for FIRE. You save money more quickly (duh) but the amount of money you need to save is now lower!

[zephyr911]

Side hustle. Any number of options exist.

I'm in the ANG and sad to say that at one point that was the only money I was saving. Now I could almost live on it.
I started a rental partnership and got my real estate license, so when we buy something, I get commission AND an immediate income stream. It only took a few thousand down to get that ball rolling.

And of course, just keep sifting through your lifestyle assumptions and finding things you can do without. Look at all the typical low-hanging fruit: housing, transportation, food, entertainment, technology, etc.

If you're spending more than $1 a day on work lunches, think about cooking in bulk and freezing portions. Here's $8 and 20-30 minutes of a relaxing Saturday: