Author Topic: High Income, Eventual Military Pension, how to build a bridge from 44 to 59 1/2?  (Read 1572 times)

EngineerYogi

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Reader Case Study - What is the most optimal way to build our bridge for early retirement when Mr. Yogi reaches 59 1/2 and we can access our retirement accounts penalty free? Based on our current numbers and assuming we will need to generate $100k/yr in addition to Mr. Yogi's $60k/yr pension in order to maintain our current expenses we are questioning whether a roth conversion ladder is the optimal choice for us? Our alternate idea is to begin putting all of our retirement contributions (except $9k to hit my employer match) into our taxable account.

Life Situation: EngineerYogi (34) and Mr. Yogi (38), married filing jointly residing in California, 2 kids age 6 & 3. Mr. Yogi is active duty military and is resident of a state that does not tax military income, as his spouse I pay taxes to his state of residence as well (~5%) and am exempt from California taxes (except for the CA SDI withholding).

Gross Salary/Wages: In 2023 $338,491 not including Mr. Yogi's bonus which will pay one more time this year and is $30k. ($64,440 of this is not taxable at the federal level (the bonus is taxable))

Individual amounts of each Pre-tax deductions 401k, HSA, FSA, IRA, insurance, etc.
Pretax Health/Dental/Vision Ins.$117$386$502
Daycare FSA$5,000$0$5,000
Life Insurance$306$0$306
401(k) / 403(b) / TSP / etc.$23,000$23,000$46,000
Pre-tax totals$28,423$23,386$51,809

Adjusted Gross Income: $222,242 ($286,682 with the non-taxable income)

Taxes: $55,000

Current expenses:
Monthly Average ExpensesComments
Mortgage$2,360Input to Item. Ded.$28,321
Property Tax$530Input to Item. Ded.$6,363
Home/Rent Insurance$132$1,579
Beautician/personal grooming$200$2,400
Cable TV$150$1,800
Car Insurance$182$2,189
Car Maintenance, Registration, etc.$225$2,700
Charitable contributions (itemizable)$50Input to Item. Ded.$600
Child activities $706$8,472
Child/Dependent care$1,494To Child/Dep Care credit$17,928
Christmas/Holidays$425$5,100
Clothing/Shoes$175$2,100
Dining (Lunch/Dinner/Etc.)$250$3,000
Gifts (not charitable contributions)$150$1,800
Electricity$125$1,500
Entertainment$200$2,400
Fuel/Public Transport$400$4,800
Groceries$2,000$24,000
Household; Maintenance$780$9,360
Internet$128$1,536
Medicine (OTC + Prescription)$130Input to Item. Ded.$1,560
Miscellaneous$200$2,400
Phone (cell)$225$2,700
Recycling/Trash$35$420
Travel/Vacation$2,000$24,000
Umbrella Insurance$17$206
Water/Sewer$140$1,680
Wine/Beer/Tobacco$25$300
Non-mortgage total
$11,074$132,893
Loans
AutoLoan$680$8,156
Solar Loan$377$4,520
Total Expense
$14,491$173,889

Expected ER expenses: $150k is the target, that would be done just by eliminating childcare, lawn maintenance, and our housekeeper (we both work full time and have 45 minute one way commutes, these things are neccesseties and/or keep us sane). We know we have some options here, but would like to assume we'll continue our spending at the current rate in order to stay in our house and keep the kids in the same school.

Assets:
Current Savings
Taxable stocks & bonds$104,961
Tax-deferred (e.g. trad. IRA/401k)$547,471
Roth + HSA$327,126
Home Equity$705,000
Cash$33,000

We also have two cars, a paid off '12 Corolla with 139k miles on it and a financed (face punch received) '23 Hybrid Sienna

Liabilities:
Loans:Orig. Prin.Orig. LengthCurr. Prin.Yrs leftRate
Mortgage$542,28630$495,64625.93.25%
AutoLoan$41,0576$39,5730.7572589960122585.96%
Solar Loan$33,56110$7,8516.24%

The intent is to pay off the solar loan and auto loan this year using Mr. Yogi's bonus and extra payments.

Specific Question(s): What is the most optimal way to build our bridge for early retirement to when Mr. Yogi reaches 59 1/2 and we can access our retirement accounts penalty free? Based on our current numbers and assuming we will need to generate $100k/yr in addition to Mr. Yogi's $60k/yr pension in order to maintain our current expenses we are questioning whether a roth conversion ladder is the optimal choice for us? Our alternate idea is to begin putting all of our retirement contributions (except $9k to hit my employer match) into our taxable account.

Our financial picture is going to change quite a bit over the next few years. The numbers above are based on 2023 income, Mr. Yogi and I each received 5% raises this year. Mr. Yogi will receive his final bonus payment ($30k before taxes, usually $23k after tax withholding) this year. Mr. Yogi will retire from the military ~April 2026 and immediately start receiving his pension of ~$60k/yr. (there is also the potential for a veteran disability rating which may reduce taxable income or even add some income) When he retires though we will both become subject to California taxes which is significantly higher than what we've been paying and California also taxes military pensions. Mr. Yogi will be 41 and we'll have to decide whether he takes on the role of house spouse or obtains a job. He would be eligible to do similar to what he is already doing as a contractor and should be able to get a salary of ~$160k/yr.

We are guessing we'll need a bridge account of around $950k, is there a calculator out there to determine this? Using the case study spreadsheet with 2023 income numbers (minus the bonus) we have 6.6 years to reach FI. (to keep up with those income/savings numbers Mr. Yogi would need a job post retirement) That would make us 44 & 40 and require a bridge of 15 years.

nereo

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Member @Nords  is one of the military retirement gurus around here - hes even written a book and has a blog on the subject:https://militaryfinancialindependence.com/about/books/


EngineerYogi

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Member @Nords  is one of the military retirement gurus around here - hes even written a book and has a blog on the subject:https://militaryfinancialindependence.com/about/books/

Mr Yogi bought the book in 2021, looks like we need to read it again! Nords has commented on my journal posts in years past but I took a forum break for the last 3ish years... 😬 Trying to get serious about the future again!

tj

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With how high your income is, It seems doubtful that it would be beneficial to forego tax deferred savings to grow your taxable account. The difference between California state taxes and yoru current state doesn't seem high enough to voluntarily pay more federal taxes now - but definitely pay attention to what happens with potential 2025 tax law change.

However, with how high your income and associated expenses are, you really should be accounting for income taxes when determining your total expenses and unless I missed it, that's not there.

If your proposed spend in retirement is $160k/year, then the portfolio size to create the income (minus the pension) is about a portfolio $2.25 Mil. Right Now you have about $979k. That may or may not happen in the 6.6 years that you have referenced...that seems optimistic to me.

You basically will need 5 years in a combination of taxable account and Roth basis. If you won't have that, you could either earn some income in retirement or just pay the 10% penalty (and 2.5% penalty for California) to get you through the first five years.  I don't think you have a Rtoh doesn't make sense math problem -at least not yet - because maxing out the tax deferred accounts over the next 7 years should get that traditional balance to where it needs to be to get through the first 5 years. If there was a clearer image of how you are going to grow your portfolio in your stated time to meet your goals, then it would be easier to determine the right strategy.

To me it seems like Roth conversions would be beneficial to you, because you currently earn significantly more than the income that you will need to generate in retirement.

lhamo

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Do you have a Roth 401k option while you are still working?  Because your contributions to that will be accessible once you roll it to a Roth IRA. 

I had a Roth 403b that I rolled from Fidelity to a Roth IRA at Vanguard when I FIREd in 2015.  I have about $110k in contributions there that I can tap if I need to (I'm only a little over 4 years from age 59.5 so I'm hoping I can just keep that money simmering, but it is a backup source of cash if/when I need it).  The original contribution amount shows up in Box 5 of the 1099-R form you get in the year you do the conversion.  Keep copies of that accessible in your FIRE files to track the amounts.

Nords

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Member @Nords  is one of the military retirement gurus around here - hes even written a book and has a blog on the subject:https://militaryfinancialindependence.com/about/books/

Mr Yogi bought the book in 2021, looks like we need to read it again! Nords has commented on my journal posts in years past but I took a forum break for the last 3ish years... 😬 Trying to get serious about the future again!
@EngineerYogi, it looks like your two choices are:
- build up a taxable account now to get you through 18ish years of expenses with a mix of cash and equities, and
- your spouse starts a bridge career after retiring from active duty.

If you continue contributing to a traditional TSP, a traditional 401(k), and traditional IRAs now with the idea of Roth IRA conversions after leaving the military, then the additional income of a bridge career doesn't leave any room for Roth IRA conversions. 

You could immediately switch your current traditional contributions to Roth contributions (and pay more income tax now).  You'd be able to withdraw the Roth IRA contributions any time for any reason.  After leaving the military you could roll your Roth TSP into a Roth IRA and immediately withdraw the contributions you made to the Roth TSP (but not the gains).  However with only two years of those contributions before leaving active duty, I'm not sure the math gives you enough money between ages 41 and 59.5.

Unless you're both absolutely certain that you're pursuing bridge careers after he retires from active duty (and he starts the networking now) then it seems a lot safer to save up the assets in a taxable account.  The bridge career will add on to those assets, and when you quit the bridge careers then you'll have time to start a Roth IRA conversion ladder.

EngineerYogi

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However, with how high your income and associated expenses are, you really should be accounting for income taxes when determining your total expenses and unless I missed it, that's not there.

If your proposed spend in retirement is $160k/year, then the portfolio size to create the income (minus the pension) is about a portfolio $2.25 Mil. Right Now you have about $979k. That may or may not happen in the 6.6 years that you have referenced...that seems optimistic to me.

You basically will need 5 years in a combination of taxable account and Roth basis. If you won't have that, you could either earn some income in retirement or just pay the 10% penalty (and 2.5% penalty for California) to get you through the first five years.  I don't think you have a Rtoh doesn't make sense math problem -at least not yet - because maxing out the tax deferred accounts over the next 7 years should get that traditional balance to where it needs to be to get through the first 5 years. If there was a clearer image of how you are going to grow your portfolio in your stated time to meet your goals, then it would be easier to determine the right strategy.

To me it seems like Roth conversions would be beneficial to you, because you currently earn significantly more than the income that you will need to generate in retirement.

I think you're right, we need to lay out the plan to show how we reach 2.5 mil; our thought was we are currently coast FI with what we have if we didn't touch it until Mr. Yogi is 59 1/2. But that means we need enough assets (or jobs/income) to cover the bridge years.

Do you have a Roth 401k option while you are still working?  Because your contributions to that will be accessible once you roll it to a Roth IRA. 

I had a Roth 403b that I rolled from Fidelity to a Roth IRA at Vanguard when I FIREd in 2015.  I have about $110k in contributions there that I can tap if I need to (I'm only a little over 4 years from age 59.5 so I'm hoping I can just keep that money simmering, but it is a backup source of cash if/when I need it).  The original contribution amount shows up in Box 5 of the 1099-R form you get in the year you do the conversion.  Keep copies of that accessible in your FIRE files to track the amounts.

We both have the ability to contribute to 401k/TSP Roth. I also have the ability to do mega backdoor roth contributions up to 5% of my salary in my 401k.

Member @Nords  is one of the military retirement gurus around here - hes even written a book and has a blog on the subject:https://militaryfinancialindependence.com/about/books/

Mr Yogi bought the book in 2021, looks like we need to read it again! Nords has commented on my journal posts in years past but I took a forum break for the last 3ish years... 😬 Trying to get serious about the future again!
@EngineerYogi, it looks like your two choices are:
- build up a taxable account now to get you through 18ish years of expenses with a mix of cash and equities, and
- your spouse starts a bridge career after retiring from active duty.

If you continue contributing to a traditional TSP, a traditional 401(k), and traditional IRAs now with the idea of Roth IRA conversions after leaving the military, then the additional income of a bridge career doesn't leave any room for Roth IRA conversions. 

You could immediately switch your current traditional contributions to Roth contributions (and pay more income tax now).  You'd be able to withdraw the Roth IRA contributions any time for any reason.  After leaving the military you could roll your Roth TSP into a Roth IRA and immediately withdraw the contributions you made to the Roth TSP (but not the gains).  However with only two years of those contributions before leaving active duty, I'm not sure the math gives you enough money between ages 41 and 59.5.

Unless you're both absolutely certain that you're pursuing bridge careers after he retires from active duty (and he starts the networking now) then it seems a lot safer to save up the assets in a taxable account.  The bridge career will add on to those assets, and when you quit the bridge careers then you'll have time to start a Roth IRA conversion ladder.

Our current plan is I will continue my current employment, Mr. Yogi is networking now for his bridge career. I think what we were missing was that we could/should wait until we're both retired and then start a Roth conversion ladder. So we need 5 years of expenses in a taxable account to carry us through the conversion.

I'll follow up with some forecasts of income/expenses/savings for the next few years based on how employment status may change. I also have an employee stock ownership plan with my company which will fully vest in February of 2027. It is currently valued at ~$27k, but that isn't including 2023's contribution yet. I will receive the balance as a lump sum payout when I leave the company and can roll it into an IRA.

lhamo

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Holy moly -- I just looked at your expenses.

I know California is an expensive place to live, but once you no longer have two stressful FT jobs with long commutes you should be able to drop your expenses WAAAAAY down.  I would strongly consider letting Mr. Yogi take a good long break after he leaves his military role and see what he can do to bring those costs down by taking more stuff in house and learning how to shop for value.  $2k/month for groceries is insane.  So is paying $150/month for cable + ANOTHER $128 for internet.  PLUS ridiculous amounts for your cell service. 

I'm sorry.  I know you said you were fine with this level of spending which is why you want to plan for it.  But you are making your time to FIRE, or at least FI where you have some real choices available to you, MUCH longer than it needs to be.

Let Mr. Yogi take a break and see if working toward a lower-cost lifestyle feels like a good use of his time.  It doesn't have to be forever.  Maybe he will want to explore consulting opportunities.  But in the meantime if you can get several big chunks of your budget whittled down significantly and also find that your quality of life goes UP when you spend less, not down, you will have cut your time to FIRE and given yourselves WAAAAY more options to consider than just how to cash flow 160k of expenses when really you could be perfectly happy on 60-80k.

EngineerYogi

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@lhamo I hear you. I posted our spending for the last four years in my journal >_< it was significantly higher than what I have listed here. This is our target budget for the year, we think we can save more but we've never actually stuck to a budget. We are being aware this year and have already cut a number of subscriptions and consciously been prepping our own meals at home and not dining out.

lhamo

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@lhamo I hear you. I posted our spending for the last four years in my journal >_< it was significantly higher than what I have listed here. This is our target budget for the year, we think we can save more but we've never actually stuck to a budget. We are being aware this year and have already cut a number of subscriptions and consciously been prepping our own meals at home and not dining out.

Good work!

The good news is that you have LOTS of low hanging fruit.  It should be quite easy to maintain a similar quality of life while cutting WAY back on the amount of money you spend on it.  It will require an increase in the amount of time one or both of you devote to such things.  But I think you will find the tradeoffs worthwhile.  And once you have things like where to shop, when to stock up on commonly used foods/what a good target price is (like for me it is under $4/lb on beef, $2/lb on boneless chicken, $1/lb on bone in chicken -- you can track that kind of thing mentally pretty easily without going to the fuss and hassle of a full blown price book).

Again, if Mr. Yogi is really interested in trying out the role of the household manager, him spending the first 3-12 months of his retirement from the military would be a great time to try to get some of this stuff dialed in.  Of course he can also be researching fun, lower cost things for y'all to do as a family -- yes, I'm kind of side-eyeing those child activity/entertainment/travel line items.  You can have excellent experiences for MUCH less. 

neo von retorch

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Current expenses:
Monthly Average ExpensesComments
Beautician/personal grooming$200$2,400
Cable TV$150$1,800
Car Insurance$182$2,189
Car Maintenance, Registration, etc.$225$2,700
Child activities $706$8,472
Christmas/Holidays$425$5,100
Clothing/Shoes$175$2,100
Dining (Lunch/Dinner/Etc.)$250$3,000
Gifts (not charitable contributions)$150$1,800
Entertainment$200$2,400
Fuel/Public Transport$400$4,800
Groceries$2,000$24,000
Household; Maintenance$780$9,360
Internet$128$1,536
Miscellaneous$200$2,400
Phone (cell)$225$2,700
Travel/Vacation$2,000$24,000
Umbrella Insurance$17$206
Non-mortgage total
$11,074$132,893

Expected ER expenses: $150k is the target, that would be done just by eliminating childcare, lawn maintenance, and our housekeeper (we both work full time and have 45 minute one way commutes, these things are neccesseties and/or keep us sane). We know we have some options here, but would like to assume we'll continue our spending at the current rate in order to stay in our house and keep the kids in the same school.

You didn't ask for ways to cut down on your expenses, and presumably you don't want to but I'll join in on this list.

Credentials - I spend ~$55k / year as a couple plus a bunch more sometimes (lumpy expenses). This year we spent about $100k but over a third of that was "one time" upgrades for our house as we prepare to sell. We try to make a lot out of a little.

So, I removed a bunch of expenses from your table that you're unlikely to change or improve upon, but I hope there's low-hanging fruit that you will consider addressing anyway. Mostly I want to understand and I'll do that by trying to relate spending to my own.

Personal grooming ($2400) and Clothing ($2100)... MvR and I spent $1100 in 2023 total for appearance/apparel. Combined you're about 4x our spending. Is there room to wiggle here? I'm someone with very specific needs for shoes - they tend to cost $130-150, but they also last ~3 years.

As mentioned by someone else, you've got Cable TV ($1800) and Internet ($1536). Presumably you both work from home and livestream 24/7? ;) We both work from home on a 300/300 that's currently $528 / year though it jumps to $600 / year at our new house. We don't have cable, but we have a few live TV options like Peacock (~$30 - 120 / year) and 3-5 streaming services off and on but can't keep up with them all and cancel them when they jump from promotional pricing to $15+ / month! Overall we spent under $400 last year on streaming services. This is one of those "core Mustachian tenants." With a kid around, are you getting life happiness / joy from these expensive streaming / TV experiences that are worth this much money? Aside from that, we have a similar "Entertainment" budget (i.e. experiences outside the home, shows, etc.) - $1800 to your $2400, so I can relate on that one!

Christmas and gifts adding up to almost $7000. I'm not sure how to process that. We spent nearly $2k on gifts last year, in part because I spent $400 on a monitor for MvR (which is really a work expense!)

Car maintenance ($2700) - is that just a very expensive state to register cars? Two Toyotas should not be expensive to maintain, especially when one is brand new. Over the past 4 years we averaged ~$1000/year on our two Mazdas (which were ~9 years old last year.) Gas ($4800) also kind of shocks me. Guessing you are NOT working from home, but commuting! We averaged $1400 / year on gas over the past 4.

Household maintenance ($9360) - wow. What all does this entail? While we have a mix of DIY and hiring, we averaged $1100 over the past 4 years. I just can't fathom a nearly 9x increase in costs.

Phone cell ($2700) - we have 2 lines with Mint Mobile so we're at about $404 / year. Is paying more bringing joy to your life? If it's required for work, why isn't work paying for it?

Travel / Vacation ($24000) - I mean we hope to go to Hawaii and maybe once in a lifetime, Jade Island (which would be $15-20k!) but doing this every year? Wow! Maybe I'm just jealous :) but I wonder if has to be this level of spending every year when you could cut $12k from your budget by doing this every other year?



So again, you didn't ask for this, and any ONE of the above items could be your sacred cow that you won't stop spending money on until the day you die. And that's awesome - you know what you like, and that makes for the good life. But at the same time, having so many high value categories is obviously draining money from you every year at an alarming rate, and complicating your plans of getting you to FI (where you can really spend all the time in the world with your spouse and two children) which might also bring a great deal of joy and happiness to you without nearly all the expense. Is it truly beyond your wishes to trim some of these categories down and get to a more optimal "happiness/$" level? Or are any of these ones you might actually reflect on and say... that isn't worth the cost, let's find a way to get the value out of it that is worth it to me?

EngineerYogi

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You all have given us plenty to think about!

I will happily analyze the spendy items which are definitely low hanging fruit. We cut back our supplement subscription last night, saved $50/mo. We cancelled HBO (MAX) saved $150/yr, we moved the Disney/Hulu bundle to our Amex Platinum card (which we get with no annual fee because of Mr. Yogi's service) which will make it only $5/mo, saving us $20/mo, and we cancelled our Audible monthly credit subscription and got ourselves established on Libby saving $15/mo. Remaining subscriptions Youtube TV (with NFL Sunday Ticket (Mr. Yogi Sacred Cow)), Spotify, Netflix (we're on the fence, it is mostly the kids watching it).

Cell phone is actually ~$173/mo, I have in the budget slush to cover future upgrades. We get unlimited everything for our two lines plus unlimited 5G hot spot data which we use for my laptop if I'm working out of the office, or the kids tablets when we're out of the house.

Internet, we call every year and get the promotion, but this is the only internet offered in our area and we were exceeding the data usage and getting charged for extra data. (the whole house is streaming, chrome cast for the tvs, 5 wifi security cameras, google home devices, a playstation, laptops, tablets, phones...) But I just looked at the website and it should be less... so I'll call them today.

Beauty/grooming, this isn't the exact match to my budget items but I have mani/pedis in there and our peloton membership (we have a bike and treadmill), I'm going to start cutting my own hair, Yogurt hasn't had her hair cut yet, and Granola gets hair cuts about monthly, Mr. Yogi doesn't have hair. :D I cut back on mani/pedis in September and they will be less frequent going forward.

Kid activities, soccer, softball, weekly year round swim lessons, ballet/tap dance classes, and KidStrong add up fast.

Christmas/Holidays, we'll cut back here for sure. We went wild last year, and we need LESS STUFF, so we'll stop buying stuff.

Household Maintenance, this includes housekeeping $4,320/yr, yard/garden service $1,040/yr, termite warranty $480/yr (we had termites in the yard in 2020), and pest service $804/yr. Other maintenance things are just expensive here... We bought new carpet for the living room($2,350), repaired a sliding glass door ($750), fixed a broken bathtub faucet ($75 DIY), fixed the A/C ($285), repaired the garage door mechanism ($175), and patched two sections of drywall last year ($2k). We spent $5k on roof repairs in 2022, and $3,500 on landscaping and outdoor space upgrades in 2021. We'll cut yard service and cut back housekeeping when one of us isn't working full-time.

Gas is just expensive here. Mr. Yogi and I are going to look at how we can carpool more frequently, we both work at nearly the same place (which is 26 miles from home). The logistics just need discussed. My new car is a hybrid, so that helps on this category.

Auto/home/umbrella insurance are a single policy, we get home and umbrella for cheap because we bundle with auto.

Clothing... this is all me. I'm working on it. I love nice clothes, I dress business to business formal for work. But I cancelled my DailyLook subscription (box of clothes to the house 4x year, I was keeping ~$300 worth each time) and my Nuuly subscription ($105/mo rental service). The kids grow fast, so they'll still need clothes regularly. I found a hack to make my Allbirds last longer, I was putting a hole in them within a year and they're $100/pair.

Travel, yeah... we go to Disney World every year but our friends have a place and vehicle for free so it's just airline tickets, Disney tickets (discounted for military), and food/spending money. Mr. Yogi stopped drinking this year, which will cut our food/spending dramatically for this trip. We also visit my family in Washington and Mr. Yogi's family in Nevada every year, and drive to meet up with SIL and niece in So Cal for a week each year. In addition we've traveled to Hawaii for a week in the summer the last two years. I travel a fair amount for work so we use hotel, rental car, and airline points to maximize savings. 5 vacations a year, 3-4 requiring airline tickets for $24k for a family of four, feels like we're doing pretty good. I also recognize that FIVE vacations a year is lavish by all standards. We're skipping Hawaii this year and our friends are coming to stay with us for local area day trips instead. Not having family near us (thanks military) and having family that flat out can't afford to travel is another reason we do as many trips as we do.

Groceries, I haven't spent less thank 2k/mo on groceries since probably 2013. So spending even less will be a massive challenge. I don't know how to justify it to anyone (we have higher than average calorie needs as tall/muscular active adults, we prefer high quality local/organic food, we eat a lot of protein) but we did stop the ready made meal delivery service last year and will save $9k. We were hemorrhaging cash in this department.

Entertainment/Miscellaneous, this is bowling, arcade, movie theater type stuff as a family and spending money for me, Mr. Yogi, and Yogurt's allowance. We put more in the travel budget and do the entertainment thing around once a month.
« Last Edit: January 24, 2024, 11:47:01 AM by EngineerYogi »

EngineerYogi

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@lhamo I hear you. I posted our spending for the last four years in my journal >_< it was significantly higher than what I have listed here. This is our target budget for the year, we think we can save more but we've never actually stuck to a budget. We are being aware this year and have already cut a number of subscriptions and consciously been prepping our own meals at home and not dining out.

Good work!

The good news is that you have LOTS of low hanging fruit.  It should be quite easy to maintain a similar quality of life while cutting WAY back on the amount of money you spend on it.  It will require an increase in the amount of time one or both of you devote to such things.  But I think you will find the tradeoffs worthwhile.  And once you have things like where to shop, when to stock up on commonly used foods/what a good target price is (like for me it is under $4/lb on beef, $2/lb on boneless chicken, $1/lb on bone in chicken -- you can track that kind of thing mentally pretty easily without going to the fuss and hassle of a full blown price book).

Again, if Mr. Yogi is really interested in trying out the role of the household manager, him spending the first 3-12 months of his retirement from the military would be a great time to try to get some of this stuff dialed in.  Of course he can also be researching fun, lower cost things for y'all to do as a family -- yes, I'm kind of side-eyeing those child activity/entertainment/travel line items.  You can have excellent experiences for MUCH less.

I'll work this weekend to forecast what it looks like if Mr. Yogi fully retires. He's cycling through personal finance books and catching up on Nords' blog posts and is definitely leaning toward us needing much less than we think we need which makes him retiring an easy answer.

neo von retorch

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You all have given us plenty to think about!

I will happily analyze the spendy items which are definitely low hanging fruit.

Great response! You're definitely not smashing your eyes shut in denial, and you're considering changes that can save you money without hurting your mental health and happiness! And you're already making some changes and saving some money!

(We're 6'2" and 5'7" but you're probably a bit more fit than we are *grin*.)

lhamo

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Costco is your friend when it comes to affordable, high quality protein.  Their wild-caught salmon fillets are usually around $10/lb, which is not bad for really good quality fish.  They also have lots of other seafood options.  I don't use them for chicken/beef because I usually can get better prices buying local grocery store loss leaders.

If you eat nuts and nut butters, Costco is also your place.

Also nice cheeses.

Also healthy oils -- their organic Olive Oil is like $12-14 for a huge jug.  You would pay that much for a small bottle at whole foods that isn't as good quality.

Their wine is supposed to be really good quality for the money -- apparently they are the largest wine buyer in North America (if not the world).

If you really want good local/organic, you should look at a CSA or otherwise sourcing direct from local farmers.  Investing in a chest freezer you keep in the garage and buying meat directly from a farmer is going to save you tons of money and get you very good quality, more ethically raised animal protein.

If you eat soy products like tofu, etc you need to find an Asian market to buy those.  Tofu that costs $5/block at Whole foods will be $1-3 at an Asian market.  Asian greens are also usually MUCH cheaper at those kinds of stores than at western markets.

If you want to PM me your zip code (I'll keep it confidential) I can dig around a little bit to try to help you locate some alternative sources to bring your food bill down without sacrificing quality.  You might need to hit a few different stores every month, but I'm confident that by comparison shopping a bit Mr. Yogi will pretty easily earn a decent RHW compared to how you currently spend.

EngineerYogi

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If you want to PM me your zip code (I'll keep it confidential) I can dig around a little bit to try to help you locate some alternative sources to bring your food bill down without sacrificing quality.  You might need to hit a few different stores every month, but I'm confident that by comparison shopping a bit Mr. Yogi will pretty easily earn a decent RHW compared to how you currently spend.

I sent you a PM. Thank you again for the helpful tips. <3