Author Topic: How much money do I need to ER?  (Read 2316 times)

medinaj2160

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How much money do I need to ER?
« on: October 14, 2013, 03:39:28 PM »
I wonder how much money MMM members think someone like me and my wife would need to ER. I asked the same question on other forums and to me it seems that they are being super conservative.

Here a break down of what me 28 and my wife 29 expenses should be when we are ready to retire:

Food: 600
Phones: 100
Gas: 120
Car insurance: 145
Home insurance: 200
Bills: 200
Insurance= unknown when we retire... 200 a month with obamacare??
Other= 100

TOTAL= $1665 a month

I imagine we will receive some kind of social security but I am not counting on it.

thanks

« Last Edit: October 14, 2013, 03:41:01 PM by medinaj2160 »

The Bearded Bank Builder

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Re: How much money do I need to ER?
« Reply #1 on: October 14, 2013, 03:49:05 PM »
My math puts it at right around $500k if you want to have the 4% Safe Withdrawal Rate that is recommended on this blog.

$1665/month = $19,980/year

$19,980 x 25 = $499,500

Eric

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Re: How much money do I need to ER?
« Reply #2 on: October 14, 2013, 04:08:40 PM »
I think you may be underestimating your expenses by a little.  Are you planning any travel?  Entertainment?  Will your health care may have a deductible or copays, etc.?  How will you pay for any major housing repairs and/or car repairs or replacement?

However, if you're certain that your expenses really will be as low as you say, I agree with The BBB that you're looking at around $500K.

medinaj2160

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Re: How much money do I need to ER?
« Reply #3 on: October 14, 2013, 04:51:01 PM »
We currently spend 600 on food, 145 on car insurance, 120 on gas, 200 in bills and 200 on phones. The house will be paid off in December if everything goes well. I also believe could spend a lot less. We go out to eat twice a week and have 3 cars. The phone should go down to 100 once my Verizon contract ends.

I think we can squeeze 100 dollars of our future monthly budget by a 100 and with the 100 for "other" expenses we should have around $2400 dollars a year for entertainment, vacation or unforeseen repairs. We probably will save around $625K or 25K year just to be save before pulling the trigger on ER.

Our current income is 120k a year and we are trying to ER as soon as possible.

Thanks

meadow lark

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Re: How much money do I need to ER?
« Reply #4 on: October 14, 2013, 05:02:59 PM »
Don't forget there are still costs with a paid off house - taxes, insurance, maintenance.  And $100 might be adequate for you two for clothes, shoes, toiletries, dentist, possible optometry. It's not enough for my family.
  Good luck!  I hope you get to ER soon!