So today I sat down and filled out the CashFlow calculator excel sheet I found on a thread some time ago. My goal is to be FI by the time I'm 35, which is in 10 years.
According to the calculator, in 10 years I will have:
$250,306 in taxable
$360,113 in 401k
$97,894 in Roth IRA
$708,313 total
Stash needed @4.0% SWR with 25k/yr exp: $625,000 (see disclaimer at the bottom)
So I am $83,000 over my needed stash.
This of course, assumes nothing in my life changes. As a single, almost 25 yr old, I will bet my life will change dramatically in the next 10 yrs. However, at this stage in my life, I am very independent and do not have any desire to meet anyone and be married any time soon. I also do not want children. My plan is to travel almost full time once FI. I want to spend months at a time in destinations, but still have a home base.
In the spreadsheet I did not include any income from rentals. Rental properties is something I am considering but have not decided on. I wanted to see what my stash would look like without the help of rentals. I have money in cash right now that could be enough for a downpayment on a rental so this does not affect the investment money above. I am thinking rental income would be ideal to put towards my mortgage during FIRE, which would lower my expenses in retirement.
So, will I be able to make it with just $250,306 in a taxable account for 25 yrs before 59.5? I put my numbers in FIREcalc and the answer is no, only a 5% chance it will survive. I know I can withdrawal the money I put in a Roth and I can do a Roth conversion ladder to cover expenses, however, I feel like the still seems risky given such a low amount in the taxable account. FIREcalc expects the 250k to have a 95% chance of being completely depleted in 6 yrs. Adding withdrawals from my Roth contributions doesn't add much to the 250k and I don't have much time to wait 5 years for the Roth conversions to "season".
Everything I have read on this forum says to include retirement accounts in your stash and figure out the amount needed with the 4% SWR and you're good to go. Well, according to this I am over my needed stash, but will fail with withdrawing from only the taxable account and from some of the Roth.
I guess what my question is, am I thinking this through correctly? Do I need to have much more in my taxable account before I can FIRE? In this situation do I NEED rental (or some other) income during FIRE to help cover my expenses since the taxable account isn't enough?
Disclaimer: the amount needed in retirement is a very rough estimate. I don't know what I will need for my travels, I thought 10k seemed reasonable but I could be way off. However, my living expenses should be roughly the same (15k). I did this exercise to see if FIRE in 10 years was even remotely possible.