Very excited to finally join the forum.
Please advise whether I will be able to retire in 2 years.
I am 54 years old. I am currently working with an income of 102300 annually.
I have 500k in my 403b and 457 plan. I am still contributing 22k per year.
Upon retirement, I will have a defined pension of $4500 per month. No cost of living adjustment. I also will have a supplement income of $970 per month for 10 years or $350 per month for the rest of my living life.
I have a house worth 750k on the market with 80k left on the mortgage.
I plan to sell my house in a year or two, buy a condo for about 350k.
Am I good for retirement at 56 years old ?
Thanks.
Silvia
Let's look at the numbers. You earn $102300, but you're currently contributing $22000, you don't say if that's pre or post tax money, but let's assume it's pre-tax. That means your base salary is around $80000. That gives you around $6700 gross per month, and probably about $5200 after deductions. Now that's with no state tax, state tax would make it lower.
Now if we assume you won't cut any spending at all, apart from retirement contributions, you'll need to replace $5200 a month. Your pension already covers $4500 so you're only short $700. Then you have either another $970 for 10 years, or $350 for life. With the 10 year amount, you'll actually have more spending money than now. If you take the $350 you're now only another $350 short. Then you'll likely gain ($750000-$80000-$350000) $320000 or to be safe we can say - another $20000 for expenses, so let's call it $300000 gained post house change. And of course let's not forget the $500000 you already have sitting around in your accounts. Using the 4% rule that would give you $32000 a year to spend, or $2666 a month.
So to round off, you're probably spending $5200 a month now. In two years you can retire on $7516. Yes I think you'll be ok :)
So to round off, you'll be able to spend $