Life Situation: Married - both of us are 40 years old. Both fairly frugal, but hubby has had harder time with decision to get rid of second car. Children ages 8 and 10, living in outer suburban Melbourne area. Hubby works for a government agency in the CBD 50 odd kms away (uses public transport), I contract from home in finance area and have a part time remote role as an employee too.
We made some poor business decisions, but thanks to being reasonably naturally frugal we aren't in as big a hole as we might have been. The below is actually a conservative forecast forward two years, as our current situation is changing by then (selling our farm land, currently leased to other farmers). So, the below is for us both aged 42 in April 2018.
Retirement accounts in Australia - our employers pay 9.5% into our retirement (superannuation) accounts on top of our wage. These are taxed at 15% when they are deposited - no matter our personal income tax rates. Earnings in our retirement accounts on investments is taxed at 15% until we reach 65, when they are tax free.
Earnings and Deductions
Gross Earnings $110,000
Superannuation paid our employers $9,500
Earnings plus Super $119,500
Income tax $16,500 (Aussies will recognise this is low - my businesses carried forward losses mean I pay no tax on my contract income)
Tax on superannuation $1,425
Net Earnings $101,575
Monthly Earnings $8,464.58
Monthly expenses:
House Insurance/Rates $200
Water $100 (edited, I had bill frequency wrong)
Kid activities $50
Netflix $14
Internet/home phone $80
Cellphones $70
Gas/Power $150 (edited, bill frequencies wrong)
Health Insurance $195
Prescriptions $10
Auto (Gas & Maintenance) $385 (looking to reduce to $300 by selling one car)
Auto (insurance & registrations) $250 (looking to halve this by selling one car)
Groceries $1000 (includes pet needs)
Dental/Medical $50
Yoga/Pilates $100
Entertainment (Movies, Etc.) $30
Public Transport $100
Clothing $70
Eating out $60
Travel $200 (tweaked after further chat with hubby)
Home Improvement $100
Gifts & Special Events $25
Kids pocket money $86 (left this out)
Miscellaneous $20
Total Expenditure $3,345
Assets:
Home - $380,000 value
Emergency Savings - $20,000
Superannuation funds - $320,000 (can access at 60, tax free after 65)
Shares/Stocks/ETF's (vanguard) - $100,000 (looking at increasing by $15,000 by selling 2nd car)
Investment Bond - $50,000 (very tax effective in Australia, but can't be accessed for 10 years or tax benefits lost)
Total - $870,000
Liabilities:
None
Net worth: $870,000
Current Plan: Either keep working for another couple of years, and then more to SWAMI or move my hubby to more part time work from now (keeping mind 'now' is April 2018) as his job is quite high stress with lots of on call and after hours, accepting we won't be completely FI for a bit longer.
Specific Questions:
How far off FI would you say we will still be?
I'm not sure I get using the home in net worth if it's not generating funds to live off, can I get some help?
Can I get feedback on current spending levels? Making moves to reduce auto, but I feel grocery is too high. If my health and strength (currently quite poor) has improved enough by then, I'd feel safe enough in my own strength and ability to drop the guided yoga/Pilates and practice at home.
Thank you in advance for your thoughts :)