I'm 43. I'm married and have three kids. 15,13, and almost 2.
Our TNW is 1.5 million. LNW is 1.4 million. Only debt is 2 house mortgages, the first of which is currently making a modest amount of money as a rental.
I anticipate FIRE'ing in 5 years after my youngest older kids graduates high school.
Maybe in that timespan, our networth will increase to ~2 million.
Of my the 1.4 LNW,
1.1 million is in tax-advantaged accounts (401ks, IRAs)
300k is in non-tax advantaged accounts.
Of the 1.1 million in tax advantaged accounts.
800k is in traditional.
300 k in roth.
My current LNW asset allocation is:
75% total stock market or S&P 500 large cap
10% in us bond fund
15% in my company's ESOP.
We currently spend 70k a year, but a lot of that will decrease in 3-5 years as kids become older. We currently max out both of our 401ks & IRAs, max out our HSA, and we contribute a bit to the kids 529 plans. Any other savings is put into brokerage account. Our total savings is about 60k a year into our tax advantaged accounts. And another 30k a year into brokerage accounts. We do this on a gross income of about ~200k annually.
I guess my questions are does this plan look reasonable??
Are there steps should I be taking over the next 5 years to transition to FIRE?
For example: Should I contribute less money to my 401ks & IRAs and increase the amount of money I'm saving in my brokerage account?
Should I start transitioning to a higher bond allocation? maybe an 80/20?
My ESOP is scaring me. It's all been free profit sharing contributions, and I have never really considered it. But I've got 15% (~220k) in it, my corporation is projecting the stock price will double within 5 years. That'll push the balance in that up to close to 500k, and if my total assets are 2 million, that's 25%. Which is a HUGE percentage.
Unfortunately, the terms of the ESOP, are that I can't touch the money until I quit, or turn 55 (can start drawing it down), or retire at age 62. If I quit, they will convert the stock into cash, sit on it up to 5 years, and then pay me out over a period up to 4 years. So, if I retire when I'm 48, I won't see 100% of that money until older than 55 anyway.