Hello all! Been a reader for a while and on ERE and thought I should get a face punch/check up. A bit about my situation and then the gory details.
Wife and I are in our mid 40s. Live in rural area 125 miles from a town of over 50,000. We like it here though and do not want to move. Rural = lower wages. No kids. For the first 40 years of our lives we were like the masses as far as consumption (a bit under, haven't had credit card debt for over 15 years) and that caused us to think we were doing OK. Kind of had a pre mid life crisis and started thinking what is the meaning of it all. Probably about the time we found out we were not going to have kids, either naturally or via adoption. Anyway, read YMOYL, Walden, Possum Living and other simple living books. Started making some seeming drastic changes and wife is mostly on board. That led to ERE and that lead here. When looking at the following we are trying to retire in 10 years (specifically June 2023, wife is a teacher)
Hard Assets:
House: value = $175,000 with a $106,900 4% 15 year mortgage 13.5 years remaining (net $69,000).
Cars (4 of them! Will get to that a bit later): $17,000 total
401k/403b: $28,221
IRA: $46,107
Roth IRA: $2257
MMA/Emergency fund: $18,289
Checking: $8,279
PM's (current value): $5266
TOTAL: $194,419
Soft assets:
Pension #1: Comes on line July of 2023 = $989 per month in current $ and inflation adjusted.
Pension #2: Comes on line in August 2027 = $280 per month NOT CURRENT, actual amount but is THEN inflation adjusted
Debts:
HELOC: $8280 (this WAS $34,000 November of 2011, been putting all extra $ to this)
School loans: $34,860 at 2.9% fixed
So, not including the pensions, our current net worth is $151,279. That is pretty bad for a 42/45 year old couple! SELF PUNCH to the FACE!
OK so what do the monthlies look like? Here you go!
Net income $5790
Mortgage (PITI) = $1154
HELOC payment = $2500 (min = $50)
Utilities (water, garbage, electric)= $210
School loans = $285
Car insurance = $105
Food/household/pets = $318
Gas = $214
Cable/telephone/internet = $115
Cell phones = 12 (recent change from $112 per month to prepaid)
Habits (mine is cigs- 10x face punches, hers is beads for jewelry) $160
Clothes: $60
Eating out: $85*
Alcohol = $45
Charity = $400
Prescriptions = $27
Gifts/misc = $100
Monthly investments:
403b (no match) = $115
401k (SWEET 125% match on 6% BUT low income because part year) = 140 from me, 175 from them = $315
Pension = $238
Savings rate (being most generous by including Mortgage principle paydown, HELOC paydown and investments / net income+ employer match + deferred comp) is 3668 /6458 or 57%
Now for my excuses ...... I mean reasons for some of the more punch worthy expenses .....
Cars = remember we are RURAL. No mass transit. Wife works 9.5 miles away 190 days per year. I work 6.3 miles away 52 days per year. Nearest grocery store = 27 miles. That is 2 cars. 3rd car was my father's and we used to work on it together. Cost for insurance and registration = $112 per year, drive it less than 1000 miles per year. 4th car is a BIG TRUCK, a 89 F-250 4WD. Bought it for $700 4 years ago. Cost the same $112 per year for ins/reg. Use it to harvest 4 cords of wood per year for heating, saving about $1000 per year. Drive it less than 500 per year.
Eating out = This is actually a very mustachian thing in that I am only paying food cost. I hold the liquor license for a out of state owners of the local Indian restaurant (we are now really good friends with them). We go there once a week and have a bottle of wine with dinner. The leftovers are taken home and we eat them again for the next night's dinner. So cost is $20 per week but that gets 4 meals, a bottle of wine, and takes care of date night!
Cigs = no excuse. I suck!
Plans = Pay off the HELOC by December 2012. From January 2013 till June 2023 add $200 per month to the mortgage to make sure it gets paid off by retirement date. The other $2300+ raises will go into savings. In December, 2015 we could use that savings to pay off the mortgage. We will probably do that.
So, if you made it this far, START PUNCHING AWAY! Any comments, suggestions, questions?
Thanks for reading! Love this place and the forums are GREAT