What is your target amount?

[SnackDog]

We are not big spenders so I'm pretty sure we had enough several years ago. But work is fun so I continue.  There are several other jobs and locations, including our HCOL home location, where I would love to work before giving up.  Best of luck to you all.

Also, it never hurts to have a little extra in case past performance fails to predict the future. In "Low Bond Yields and Safe Portfolio Withdrawal Rates" Finke, Blanchett, and Pfau say that a 60/40 portfolio has a 1.9% SWR if you accept a 1% chance of failure, a 2.4% SWR if you accept a 5% chance of failure, and a 2.7% SWR if you accept a 10% chance of failure.

[Nangirl17]

I feel lame with my 700k poverty stash compared to the average in this thread. I'm probably younger though. Why do you all need so much?

Likely for various reasons.... Mine is in Canadian dollars, so really only worth 2/3 of USD. Also, I don't have CPP to fall back on (self employed), and not going to get an inheritance so I will build in my own fall-back/redundancies. Hcol areas probably are going to play a role too (and not everyone can just move - elderly family to care for etc)

[begood]

Why do you all need so much?

Because... reasons. Some practical, some irrational.

Practical:

1) The exponential increases in health care costs coupled the very real possibility that if the ACA is dismantled and its key components eliminated, I could not buy health insurance on the open market and would have to rely entirely on health insurance being available through an employer.

2) The price of a college education. My freshman year tuition in 1983 was $5k. Inflation adjusted, in 2017 that would be $12K. Instead, that college now costs $47K a year - a 291% increase in adjusted dollars; an 840% increase in "real" dollars.

Irrational:

1) I worry about my stash ALL THE TIME. We've done the things we're supposed to do, but I'm still worried that it will all  go *poof*. So though we could probably retire now, continuing to shovel funds into our retirement accounts helps in two ways: we're not drawing down for everyday living expenses and we do our best to live on the take-home after maxing out retirement and HSA (and payroll-deducted tuition).

2) See #1.

[arebelspy]

Why do you all need so much?

Because we are weak and pathetic.

Well, admitting so is the first step.

[LindseyC]

I am coming late to the party, so won't be retiring that much earlier then average. I am aiming for $600K, as I am in Canada so good healthcare, plus around $1000 a month from the government after 65.

I also have a very low budget lifestyle, even with a mortgage right now I only spend about 24-28K a year. Once my mortgage is gone my bare bones is $14K a year, so I am leaving myself an extra 10K a year prior to 65 and about 22K extra after 65. These numbers do not include side income.

Side income is a definite for me when I retire, as long as my health allows it, because I genuinely enjoy my hobbies which I can monetize. I'm also not counting any inheritance, which realistically will add a fair amount to my assets.

[caracarn]

I'm late to the party as well, having only discovered this board a little over a year ago.

Shooting for $1 million but very happy to have found that this site validated my feeling that the many millions places like Vanguard and others were trying to convince me I needed but felt somehow was crazy was right.  Much more relaxed now that I know the target is not $5 million and after seeing the Simple Math, now understand why.

[itchyfeet]

Another Aussie here and I have been FIREd for 3.5 years.

My perpetual living budget is $33K pa for two of us, which covers all living expenses that are known to occur every year. I also have an infrequent expense budget which runs over 10 years and covers major anticipated purchases (eg. car updates, major holidays, furniture updates, gadgets and appliance updates, house projects, and family assistance) and rare but potentially large medical/vet expenses. Excluding family assistance, this runs at an average of $23K pa. There is a lot of fat in this latter budget and it can be easily trimmed if required.

Rounding up to the nearest $5K puts the total at $60K pa. Our passive income (pension, dividends, interest) covers this easily, so any capital gains on underlying assets and my wife's continued casual employment income is gravy.

Well $60K aligns with the current AFSA standard for a comfortable retirement, and the way you have explained your budget sounds comfortable.

I actually used the AFSA comfortable retirement budget as a starting point for my budget. I then made a few customizations where I wanted some greater spending power:

  - increased amount for major home renovations repairs +$3,000 pa (we hopefully have 40-50 years of house upkeep ahead of us),
  - increased amount for car depreciation (or cheap 2nd car) +$3,000pa,
  - increased recreation budget for gyms, restaurants, theatre etc +$5,000pa,
  - increased travel budget +$15,000pa.

Finally, I have added 10% to cover income taxation, since my required income was getting fairly high. (Still tax is low due to Super, imputation credits, consuming post tax capital etc)

Takes me to about $93K per year. Add 2 years inflation till I FIRE and I am looking at $100K, or a stash of $2.5M AUD plus a house - say $700-800k AUD.

A grand total of $3.2 - $3.3M AUD, or $2.5M USD.

[TheAnonOne]

I feel lame with my 700k poverty stash compared to the average in this thread. I'm probably younger though. Why do you all need so much?

It looks like your number is for one person? Other posters are basing their numbers on couples/families.

MMM himself had a kid and stopped at 600k

Adding a family member MIGHT make the needle move a bit, but not by double+

[Al1961]

DW an I each retired at 53, me in 2014 and her in 2016. We did it on $1 million portfolio and a $54k federal pension with COLA. In 9-11 years there will be another $24k in CPP and OAS (2017 dollars). We also have ~$550k home equity.

At some point there will be an inheritance of ~$250K.

I think we'll keep the budget fairly tight for the next 4-5 years, then splurge a bit on travel south during the two darkest months and to the UK in summer to visit with DW's extended family.

[gerardc]

I feel lame with my 700k poverty stash compared to the average in this thread. I'm probably younger though. Why do you all need so much?

It looks like your number is for one person? Other posters are basing their numbers on couples/families.

MMM himself had a kid and stopped at 600k

Adding a family member MIGHT make the needle move a bit, but not by double+

Expenses for a couple should be between 1 and 2 times the expenses for one person, unless the couple has negative financial synergy :)

I'd be interested to get data and see what that ratio might be more precisely. 1.5? Those who answered for a couple/family, can you also provide an estimate of your target number if you were single? Or just the ratio.

Actually, I could see the ratio being greater than 2 for a single man living in a small apartment, always wearing the same clothes, etc. that marries a woman who wants a big house to decorate, plenty of expensive activities, etc. Or vice versa.

[Half Stached]

Our target is 1.7million, with the intent to stay in the HCOL area we are in now. However, we currently rent and are starting to look for a place to purchase. At that point, we'll re-evaluate to something in the neighborhood of 1.2million + fully paid off home.

[Kaminoge]

I'd be interested to get data and see what that ratio might be more precisely. 1.5? Those who answered for a couple/family, can you also provide an estimate of your target number if you were single? Or just the ratio.

I used to say $25,000 and then I got married and made it $50,000. Reason being that a huge chunk of our spending is travel and that actually costs more as a couple (for us) because I'm less prepared to stay in dorms/tents than I was when single. Also I'm Australian, he's American, no matter where we settle (if we ever do) there's always going to be a desire to travel to see family. When I was single I guess I pictured that I'd settle back in Australia eventually and then not need to travel too far to see family.

Food costs are also over double (he eats more and we eat out more simply because we enjoy it).

There are lots of other costs that would double as well (medical being one that springs to mind).

[theadvicist]

Hmmm, my husband and I definitely saved a lot of money by combining our households when we got married.

I lived on my own though, so I was already paying for one complete household. He was in a shared rental, so I guess we were paying for 1.3 properties, and that went down to 1.

[Dicey]

Our biggest expense has been our health insurance. We pay 10k/ year and and in July it will go up to 11.5k/year for retiree employer insurance. Ugh!  WE are looking at switching to the PPO for half the price but they pay less overall so more out of pocket. So I will track for a year and see what is our best choice. Some will be unpredictable because we don't know what will happen health wise.  Sure wish we would go to one payer system.  When we retired we had 40k income/year and a paid off house. In 5 years we have worked p.t. and earned anywhere from an additional 20k-70k/year.

I anticipate health insurance being our biggest expense in retirement. We are about to start a COBRA plan for $1200/month for the two of us, and the coverage is so good, I would gladly pay that price monthly for life for the same coverage. (We both have pre-existing conditions, and my husband's condition is very high-maintenance, so the excellent coverage is a must-have.)

I wish I had a crystal ball to see what will happen with health insurance over the next 20 years.

^This^ I didn't have a specific number. I knew I had enough except that healthcare was so much of a wild card. Until I got that figured out, I was afraid to pull the trigger. Happily, and unexpectedly, I did. I've been FIRE for four years now. Life is gooooood.

[Lmoot]

It's hard for me to come up with an amount because I don't have the goal of maxing out retirement savings. I'm focusing maybe 40-60 on retirement savings-real estate investing. I hope to have a healthy fleet of properties by my desired FIRE age of 45, then as I get tired of dealing with properties, sell them in some long distant future (if ever at all), which would go towards padding my retirement funds.

I have been contributing to my 401k up to my employer max since I was 25 (now 32), and have about 10k in my ROTH (will start maxing out at age 35, after I add another property or 2...currently only have 1 rental).

I have 30 years before I reach retirement age, so cost will be different with inflation, so I would like to have 3 mil in cash/assets, with at least 100k/year profit from rentals. I want to do philanthropic work in my older age and plan on using my rental income for that.

[dude]

I feel lame with my 700k poverty stash compared to the average in this thread. I'm probably younger though. Why do you all need so much?

For me, because my pension (and health insurance) is a big part of my FIRE plans, I have to face the realization that what the government giveth, it can taketh away. Is it likely? Probably not.  But having a robust investment account to weather any political chicanery that could happen seems to me a worthwhile hedge.

[Longwaytogo]

I feel lame with my 700k poverty stash compared to the average in this thread. I'm probably younger though. Why do you all need so much?

For me, because my pension (and health insurance) is a big part of my FIRE plans, I have to face the realization that what the government giveth, it can taketh away. Is it likely? Probably not.  But having a robust investment account to weather any political chicanery that could happen seems to me a worthwhile hedge.

Certainly worthwhile. A large portion of my Mom's pension got yanked out from under her and my parents were woefully un-prepared :(

They'll hopefully still end up OK but my Dad is having to stay on in a very physical (construction) job until 67. The whole pension shenanigans was a big part of what motivated me to get my head out of my ass and led me to MMM.

[wenchsenior]

We started too late for my husband to retire early.  We're aiming for him to retire at 60-62 if he wants, though he likes his work.

Absolute minimum is 800K, but we're aiming for >1 Million + Pension of ~30-35K. SS, my part-time income, etc. would be gravy. 

Currently, we are on track for this.

Reason is simple math.  We spend about 70K per year for 3 adults in two separate households (2 mortgages) plus 'outpatient' support for a fourth adult. We are currently in one of the lowest COL areas in the U.S., and we sure as hell don't want to stay here.  So even if we stopped helping support the two parents (which is not likely in the next decade), we would still be moving to a higher COL area. More likely we'd be moving to a higher COL area AND continuing parental support.

Plus, I suspect health care cost is going to to increase dramatically going forward, and I have chronic health issues.  So I'm budgeting an extra 10-20K per year for that.

So, I would like a take home income in the 85-90K range to feel very comfortable.

[living_la_vida_mi]

Working towards 2mil in about 15 years, for 2 people plus 2 kids (they will be 19 and 15 so there is that, not sure how the college situation will be). Also, we are not ultra frugal and do spend a good amount on travel and small luxuries every now and then, which I want to keep doing.

[NorthernBlitz]

I feel lame with my 700k poverty stash compared to the average in this thread. I'm probably younger though. Why do you all need so much?

Speaking for myself, it's probably uncertainty, fear, and my training to be conservative with mathematical predictions (we engineers tend to use factors of safety in calculations).

Right now, we probably spend something like $50k/year for a family of 4. But, over 20% of that is property tax. It also includes costs for a family of 4...when we retire, we'll probably be a family of 2. I can cut the majority of that out by moving to a different place. But, moving to a different place could cause a significant difference in our spending (can we find the same access to locally grown high quality food at prices we get them at now?).

As I fill in my taxes, I see that my employer pays $13k for my healthcare. I can move back to Canada and eliminate most of this additional expense. But, pretty much everything is more expensive in Canada, so how does that change my annual spending. We are always taken aback by how expensive produce is when we're visiting our families near Toronto and Ottawa.

There are so many variables that I feel that safe using my current annual spending as a guideline. It's probably more than "enough", but it's attainable in what I consider to be a reasonable amount of time. If it turns out to be "too much", we also plan on spending some of our wealth helping children / grandchildren get a leg up on their own financial independence (just like my parents and grandparents have helped me).

I'm probably a prime candidate for the "One More Year" syndrome. I think it will be hard to walk away from a job that pays so much more than what we need. I'll need counselling from the board when I get there.

[londonbanker]

In today's money our target NW should be around £3m, made up of £2.4m of invested assets and £600k for our family house.

We should be there is 4-5years hopefully.

This should support our spend level using a 3% SWR, and cover for both our kids' education (£200k budgetted in todays money)

One could argue that 3% is overly conservative, but...

1) we will be retiring at 42 y/o... Therefore the stash has to last 40+ years
2) our kids will still be 6/8 y/o and could end up being a lot more expensive that we have assumed in our budget... To an ealier post college fees inflation has outpaced normal inflation 2-3x and might continue to do so
3) elderly care cost might also end up spiraling out of control over the next 40yrs, just like college fees
4) i do not want to spend the rest of my happy retirement life worrying about running out of money and counting every $ spent, it would really spoil the experience

Retiring at 40 would probably mean a 3.6-3.8% SWR, but I am happy to stick it out for another 2yrs and drop the SWR to 3%... Especially given that my wife and I both have interesting and relatively low stress jobs

[RunningintoFI]

Based upon current spending habits (single, split living costs with roommate, reasonable level of purchases), I could get by with $450K.  Marriage and/or kids could throw a big monkey wrench into that though. 

[Khan]

At 300k net worth, I feel comfortable stepping off the reservation some and giving myself some time to do things that I've been having trouble doing while working. That should occur at or before 2020 at current rates. I'll be 32, and I have unused GI bill benefits as well to account for, and a 2 month sabbatical around that time. I don't have view of any work that pays nearly the rate I get as an essentially uncertified/generally skilled manufacturing technician, but feel comfortable in the time off at that point. I want the trajectory to be pretty set at least for retirement or other things afterwards, but the employment income to be less of a factor in future decisions, though skills/certifications and work history will likely be very monetize-able.

[Mika M]

Earlier on this thread I stated 1.6m, to give ourselves a healthy cushion. But every year it gets exponentially harder to keep up the work routine. I've always been a daydreamer, and DH's realist side has helped keep me in check and keep me from losing my head and getting too excited about cutting the cord too early.

If I include equity we've reached about 3/4m. Not including it's closer to 650. The tables are slowly starting to turn toward him being too cautious as opposed to me being too optimistic...

We used to talk in terms of 7-8 more years to reach 1.6, but once we pass 1m I'm really not sure I'll be able to keep going and might go full Peter Gibbons from Office Space. But I'm a little older than DH and can feel a mid-life crisis approaching lol... I think he's starting to understand that the 'career' is starting to weigh pretty heavy on me and at least has pitched going to one salary and me leaving work to cover down on after school hours and school breaks...

My ideal is we both quit, move out west to a small city we really like (Bend is top choice, but I like Portland too for the mild weather and affordable housing). But for that to work sooner than later we'd definitely have to figure out some part time work at least... but if we could manage just 15k in additional annual income 1m would be plenty.

But I'm willing to wait another year or two to see where we're at, and in the meantime focus a little harder on spending discipline.

[PDXTabs]

In today's dollars $2.1M would definitely be enough for me never to feel the need to work again. However, I could probably "get by" on 1.0M if my kids were out of college.

[2lazy2retire]

Just to add a little info - in addition to target amount what do people intend for their portfolio make-up ie 60/40, 80/20 etc.

[Goldielocks]

Great question.  I am thinking to pull 3 years of minimum expenses into a bond or cash type fund, and the rest in equities.

Maybe more than 3 years of expenses...  if rates go up, I may even look at covering a portion of the minimum spend with annuities, because I NEVER want to worry about where the absolute basic amount will come from (fyi FIRE means CPP payout rates are quite low.   I am talking about ensuring I have $1000 per adult per month guaranteed).

IDK.  I really like equities.

[ol1970]

I feel lame with my 700k poverty stash compared to the average in this thread. I'm probably younger though. Why do you all need so much?

I think that when you see people who have huge #'s that they are targeting that it is in many cases because they are above average earners who actually don't hate what they do for a living.  My perception is that there are a majority of people here that don't care for their line of work, and that's cool get the hell out of the rat race!  But there is a minority that sort of loves or generally enjoy what they do, and the big number represents a glide path to where they are going to end up when they are ready to do something different.  An exaggerated example is Tom Brady, he's got more money than he and his family could spend in 3 lifetimes, should he retire?   Should MMM stop posting because he doesn't need the money?  Hell no, they are doing something that brings more happiness to their lives than if they were not doing it.  So its not so much about "needing" the huge number, its just where their life is going to take them.

At least that's my excuse for saving way past the 3% rule : )

[Raenia]

I feel lame with my 700k poverty stash compared to the average in this thread. I'm probably younger though. Why do you all need so much?

My number started out at about 700k as well, when I first did the calculations.  With all the uncertainty about healthcare in the US, I rounded that up to 1 mill just to be safe.  Then I persuaded my BF, who was been skeptical of ER being a possibility, to lay out a theoretical retirement budget, and if I account for that it'll wind up being more like 1.5 mill for the both of us plus eventual kids.  There were not as many savings from being coupled vs just having a roommate as I had hoped.

[tomsang]

I feel lame with my 700k poverty stash compared to the average in this thread. I'm probably younger though. Why do you all need so much?

Sounding like an old grandfatherly guy(47 no grandkids).  I see a trend where the younger Mustachian's who are not married or have kids take into account the costs of having a family. 

I think other perks that people receive are not valued at their true costs.  Professionals tend to get gym memberships, cell phones, food at work, healthcare subsidized or paid for, etc.  I keep seeing retirement budgets where the amounts do not reflect the true costs. As an owner in my business, medical for my family is approximately $25k per year.  My employees pay nothing for themselves and 20% for adding their family to the plan. So when they are budgeting $400 for healthcare they are off by a factor of 5 for what it will cost when their employer is not paying for their medical. When you are young and healthy; who needs healthcare?  Or healthcare is cheap at 30.  Check the table for when you are 55.  If you are having kids or if you plan to age, then you need to budget more realistically for healthcare.  Obamacare appears to be on a path for the benefits to be reduced or eliminated.   

A good Mustachian can do it all forever!!! Well as I age, my body is not as up for things that I was doing when I was 30.  Moving a house(who needs movers), replacing a roof, siding, or other physically demanding tasks/chores I can see will be very different when you are 70(or 47) vs when you are a young person with a perfect body.  I have also seen very sharp family members deteriorate to the point where they should not be making financial decisions on their own. They probably should have a reputable financial analyst make their decisions regarding their Asset Allocation and buy/sell even if it costs them 1% of the Assets Under Management.

A one time event always pops up that throws your bare bones budget out of wack.  Did you properly budget for a new $10k roof, water heater, replacement car, etc.?

I would like to give my 4 kids a college education. Let them graduate with no debt.  Start them off on the right footing.  Sure I paid for my own public college(that was when the state paid 80% of the cost to educate now they pay 30%), but covering tuition and room/board at a four year school is approximately $100k per kid for a BA and potentially $200k for graduate school.  Maybe not Mustachian, but if I have the ability to work two more years and fund my 4 kids through graduate school, then I see value in that.

On the kid front.  If you don't have kids or they are young, you should know that the costs go up from when they are young.  Camps, sporting teams, drama camp, car insurance, wedding costs, cell phones, clothing, make up, hair cuts, etc.  Yeah you can minimize some of these areas by going full Mustachian, but you will spend more than you think.   

Again not Mustachian, but I also like some frivolous things in my life and my career is pretty rewarding.  I go back to SOL post on "Is your Stache Evil" or something like that.  Are you being greedy by retiring early vs. working a few more years and having the dollars for your favorite charity, or to help your kids with a down payment on a house, etc.?

The other big difference I see is that some people are talking about their Stache and their retirement vs. their current or future spouse's retirement.  Maybe I am chanelling the retirement police, but if your spouse is still working you are a stay at home spouse, you are not retired.  Why not work a few more years and get your spouse or future spouse retired as well?  We are all in this together vs. I am retired and he/she is still working.

Lastly, if I retired for 10 years and then had to go back to work, I would realistically make 1/10th of what I make today if I am lucky.  If your income is on the lower end of the spectrum then going back to work if that is possible/feasible may not be so challenging to fund your deficit.  For me working an extra few years will provide me with so much cushion that I may be funding charitable organizations with 7 figure checks in my later years.

The future is going to be pretty cool.  I want to have the options that many people may not have for myself as well as my extended family.           

[Slinky]

I anticipate ending up somewhere between $500k  - $1MM. The former should be somewhere right around bare bones FI and the latter would include extra fluff like more travel. That's based off a range of hypothetical FIRE budgets I came up with, but I haven't nailed down a firm number because I prefer to come at things from the other direction. I like looking at what I have and deciding if what that gets me is enough. If it is not enough, I ask myself if what I want is worth continuing to work full time for. Right now, I want more than what I could afford from my stash. The things I want are worth working as hard as I can for, so full time employment is still a go. When I get down to things like Netflix though, I don't intend to be working full time anymore.

[Slinky]

The other big difference I see is that some people are talking about their Stache and their retirement vs. their current or future spouse's retirement.  Maybe the retirement police, but if your spouse is still working you are a stay at home spouse, you are not retired.  Why not work a few more years and get your spouse retired as well?  We are all in this together vs. I am retired and he/she is still working.     

Counter question:
Why make your spouse give up their dreams and conform to your personal vision of happiness instead of working together to accomplish both of your dreams and be happy together?

[tomsang]

The other big difference I see is that some people are talking about their Stache and their retirement vs. their current or future spouse's retirement.  Maybe the retirement police, but if your spouse is still working you are a stay at home spouse, you are not retired.  Why not work a few more years and get your spouse retired as well?  We are all in this together vs. I am retired and he/she is still working.     

Counter question:
Why make your spouse give up their dreams and conform to your personal vision of happiness instead of working together to accomplish both of your dreams and be happy together?

In many cases I see a single person who has not found a spouse, only funding their own personal retirement.  In other cases, their spouse may be pursuing their dream job but there is still a huge difference between cutting the cord for retirement and having a spouse still working that can pay a large portion of the bills.  The risk factor is very different.  I am not knocking a stay at home spouse, but to say that you are retired is a bit of a stretch when you are counting on your spouse's income to live or to provide safety by not touching your investments during this period of time.

[Slinky]

The other big difference I see is that some people are talking about their Stache and their retirement vs. their current or future spouse's retirement.  Maybe the retirement police, but if your spouse is still working you are a stay at home spouse, you are not retired.  Why not work a few more years and get your spouse retired as well?  We are all in this together vs. I am retired and he/she is still working.     

Counter question:
Why make your spouse give up their dreams and conform to your personal vision of happiness instead of working together to accomplish both of your dreams and be happy together?

In many cases I see a single person who has not found a spouse, only funding their own personal retirement.  In other cases, their spouse may be pursuing their dream job but there is still a huge difference between cutting the cord for retirement and having a spouse still working that can pay a large portion of the bills.  The risk factor is very different.  I am not knocking a stay at home spouse, but to say that you are retired is a bit of a stretch when you are counting on your spouse's income to live or to provide safety by not touching your investments during this period of time.

That's a lot of assumptions about someone's situation and plans based on one single fact.

[BeanCounter]

I feel lame with my 700k poverty stash compared to the average in this thread. I'm probably younger though. Why do you all need so much?

Sounding like an old grandfatherly guy(47 no grandkids).  I see a trend where the younger Mustachian's who are not married or have kids take into account the costs of having a family. 

I think other perk that people receive are not valued at their true costs.  Professionals tend to get gym memberships, cell phones, food at work, healthcare subsidized or paid for, etc.  I keep seeing retirement budgets where the amounts do not reflect the true costs. As an owner in my business, medical for my family is approximately $25k per year.  My employees pay nothing for themselves and 20% for adding their family to the plan. So when they are budgeting $400 for healthcare they are off by a factor of 5 for what it will cost when their employer is not paying for their medical. When you are young and healthy; who needs healthcare?  Or healthcare is cheap at 30.  Check the table for when you are 55.  If you are having kids or if you plan to age then you need to budget more realistically for healthcare.  Obamacare appears to be on a path for the benefits to be reduced or eliminated.   

A good Mustachian can do it all forever!!! Well as I age, my body is not as up for things that I was doing when I was 30.  Moving a house(who needs movers), replacing a roof, siding, or other physically demanding tasks/chores I can see will be very different when you are 70(or 47) vs when you are a young person with a perfect body.  I have also seen very sharp family members deteriorate to the point where they should not be making financial decisions on their own. They probably should have a reputable financial analyst make their decisions regarding their Asset Allocation and buy/sell even if it costs them 1% of the Assets Under Management.

A one time event always pops up that throws your bare bones budget out of wack.  Did you properly budget for a new $10k roof, water heater, replacement car, etc.?

I would like to give my 4 kids a college education. Let them graduate with no debt.  Start them off on the right footing.  Sure I paid for my own public college(that was when the state paid 80% of the cost to educate now they pay 30%), but covering tuition and room/board at a four year school is approximately $100k per kid for a BA and potentially $200k for graduate school.  Maybe not Mustachian, but if I have the ability to work two more years and fund my 4 kids through graduate school, then I see value in that.

On the kid front.  If you don't have kids or they are young, you should know that the costs go up from when they are young.  Camps, sporting teams, drama camp, car insurance, wedding costs, cell phones, clothing, make up, hair cuts, etc.  Yeah you can minimize some of these areas by going full Mustachian, but you will spend more than you think.   

Again not Mustachian, but I also like some frivolous things in my life and my career is pretty rewarding.  I go back to SOL post on "Is your Stache Evil" or something like that.  Are you being greedy by retiring early vs. working a few more years and having the dollars for your favorite charity, or to help your kids with a down payment on at house, etc.?

The other big difference I see is that some people are talking about their Stache and their retirement vs. their current or future spouse's retirement.  Maybe I am chanelling the retirement police, but if your spouse is still working you are a stay at home spouse, you are not retired.  Why not work a few more years and get your spouse or future spouse retired as well?  We are all in this together vs. I am retired and he/she is still working.

Lastly, if I retired for 10 years I would realistically make 1/10th of what I make today if I am lucky.  If your income is on the lower end of the spectrum then going back to work if that is possible/feasible may not be so challenging to fund your deficit.  For me working an extra few years will provide me with so much cushion that I may be funding charitable organizations with 7 figure checks in my later years.

The future is going to be pretty cool.  I want to have the options that many people may not have for myself as well as my extended family.         

+1 to ALL of this. I guess I should go shave my mustache now.

[RunningWithScissors]

I've been pondering this question for a while now, since hubby and I have technically met our FI goals (investments are now earning more than my income, total net worth is over our calculated FIRE threshold).  However, I intend to keep working until my Dad completes his struggle with his terminal illness.  After that once we're pet and kid-free, we have plans to move to another province, which unfortunately is equally a HCOL area, but downsize into a smaller house. 

I'm ready to pull the pin, but my husband is still mentally grappling with the concept that we have 'enough'.    When we got together about six years ago, I was far ahead in my FIRE plans and he was essentially broke.  Now, he should catch up to me in terms of investments in about a year, which corresponds with some of the other timelines in our life. 

In terms of numbers, we've topped out over $1M in investments which are earning comfortably over 10%/yr averaged over more than a decade, and have $0.5M in real estate equity.  When I write all this down, it's clear that our biggest hurdle to FIRE is my husband's (dis)comfort level! 

[tomsang]

The other big difference I see is that some people are talking about their Stache and their retirement vs. their current or future spouse's retirement.  Maybe the retirement police, but if your spouse is still working you are a stay at home spouse, you are not retired.  Why not work a few more years and get your spouse retired as well?  We are all in this together vs. I am retired and he/she is still working.     

Counter question:
Why make your spouse give up their dreams and conform to your personal vision of happiness instead of working together to accomplish both of your dreams and be happy together?

In many cases I see a single person who has not found a spouse, only funding their own personal retirement.  In other cases, their spouse may be pursuing their dream job but there is still a huge difference between cutting the cord for retirement and having a spouse still working that can pay a large portion of the bills.  The risk factor is very different.  I am not knocking a stay at home spouse, but to say that you are retired is a bit of a stretch when you are counting on your spouse's income to live or to provide safety by not touching your investments during this period of time.

That's a lot of assumptions about someone's situation and plans based on one single fact.

Yes it is.  You asked a question without the specific facts.  Do you want to give me an exact fact pattern so the assumptions are removed?

[Slinky]

The other big difference I see is that some people are talking about their Stache and their retirement vs. their current or future spouse's retirement.  Maybe the retirement police, but if your spouse is still working you are a stay at home spouse, you are not retired.  Why not work a few more years and get your spouse retired as well?  We are all in this together vs. I am retired and he/she is still working.     

Counter question:
Why make your spouse give up their dreams and conform to your personal vision of happiness instead of working together to accomplish both of your dreams and be happy together?

In many cases I see a single person who has not found a spouse, only funding their own personal retirement.  In other cases, their spouse may be pursuing their dream job but there is still a huge difference between cutting the cord for retirement and having a spouse still working that can pay a large portion of the bills.  The risk factor is very different.  I am not knocking a stay at home spouse, but to say that you are retired is a bit of a stretch when you are counting on your spouse's income to live or to provide safety by not touching your investments during this period of time.

That's a lot of assumptions about someone's situation and plans based on one single fact.

Yes it is.  You asked a question without the specific facts.  Do you want to give me an exact fact pattern so the assumptions are removed?

No thank you. If the assumptions supporting the claim you made can be removed than they cannot always be true and neither can your claim.

[cookielover]

Our target is 2.7-3.0M in investment asset.  My home is paid off, college fund is fully funded.  we plan to get there in the next 4 -5 years.  By that time, kids will graduate from college.  Health insurance is big unknown, and our plan is based on 3% SWR on 50/50 stock/bond investment

[robtown]

Our  IRA/401k  goal (3 years out) is $1.0M - $1.1M.     House paid off (1 year),   $100k liquid (now), generous pension for spouse (1 year),  and my SS.    SS and pension will cover basic living expenses leaving me to be aggressive with retirement accounts.   In addition spouse will have about $200k in retirement account which is a fallback.    We have an long-term adult dependent child that is the wild card.
I cannot FIRE (60 yo) but will FI by 2020.

[OurTown]

My number used to be $1.2M.  I think I've moved it down to $950K with a 5% SWR ($47.5K per year), plus holding onto a side gig bringing in about $18K per year, for a total of $65.5K per year before taxes.  That assumes a) a paid-for house and b) a viable option for health insurance.  I think we can be there in about six years. 

[Kathryn K.]

I feel lame with my 700k poverty stash compared to the average in this thread. I'm probably younger though. Why do you all need so much?

Sounding like an old grandfatherly guy(47 no grandkids).  I see a trend where the younger Mustachian's who are not married or have kids take into account the costs of having a family. 

I think other perk that people receive are not valued at their true costs.  Professionals tend to get gym memberships, cell phones, food at work, healthcare subsidized or paid for, etc.  I keep seeing retirement budgets where the amounts do not reflect the true costs. As an owner in my business, medical for my family is approximately $25k per year.  My employees pay nothing for themselves and 20% for adding their family to the plan. So when they are budgeting $400 for healthcare they are off by a factor of 5 for what it will cost when their employer is not paying for their medical. When you are young and healthy; who needs healthcare?  Or healthcare is cheap at 30.  Check the table for when you are 55.  If you are having kids or if you plan to age then you need to budget more realistically for healthcare.  Obamacare appears to be on a path for the benefits to be reduced or eliminated.   

A good Mustachian can do it all forever!!! Well as I age, my body is not as up for things that I was doing when I was 30.  Moving a house(who needs movers), replacing a roof, siding, or other physically demanding tasks/chores I can see will be very different when you are 70(or 47) vs when you are a young person with a perfect body.  I have also seen very sharp family members deteriorate to the point where they should not be making financial decisions on their own. They probably should have a reputable financial analyst make their decisions regarding their Asset Allocation and buy/sell even if it costs them 1% of the Assets Under Management.

A one time event always pops up that throws your bare bones budget out of wack.  Did you properly budget for a new $10k roof, water heater, replacement car, etc.?

I would like to give my 4 kids a college education. Let them graduate with no debt.  Start them off on the right footing.  Sure I paid for my own public college(that was when the state paid 80% of the cost to educate now they pay 30%), but covering tuition and room/board at a four year school is approximately $100k per kid for a BA and potentially $200k for graduate school.  Maybe not Mustachian, but if I have the ability to work two more years and fund my 4 kids through graduate school, then I see value in that.

On the kid front.  If you don't have kids or they are young, you should know that the costs go up from when they are young.  Camps, sporting teams, drama camp, car insurance, wedding costs, cell phones, clothing, make up, hair cuts, etc.  Yeah you can minimize some of these areas by going full Mustachian, but you will spend more than you think.   

Again not Mustachian, but I also like some frivolous things in my life and my career is pretty rewarding.  I go back to SOL post on "Is your Stache Evil" or something like that.  Are you being greedy by retiring early vs. working a few more years and having the dollars for your favorite charity, or to help your kids with a down payment on at house, etc.?

The other big difference I see is that some people are talking about their Stache and their retirement vs. their current or future spouse's retirement.  Maybe I am chanelling the retirement police, but if your spouse is still working you are a stay at home spouse, you are not retired.  Why not work a few more years and get your spouse or future spouse retired as well?  We are all in this together vs. I am retired and he/she is still working.

Lastly, if I retired for 10 years I would realistically make 1/10th of what I make today if I am lucky.  If your income is on the lower end of the spectrum then going back to work if that is possible/feasible may not be so challenging to fund your deficit.  For me working an extra few years will provide me with so much cushion that I may be funding charitable organizations with 7 figure checks in my later years.

The future is going to be pretty cool.  I want to have the options that many people may not have for myself as well as my extended family.         

+1 to ALL of this. I guess I should go shave my mustache now.

Yes, those are all great points.  I'm only 35 but I not infrequently feel like telling the kids to get off my lawn around here :-)  I agree that kids are expensive - have heard many times here from people with a 3 month old how cheap kids are. Well, yes, babies are cheap (other than child care or foregone wages to stay home) but a kids package of underwear costs almost 10 bucks at Wal-Mart, for example, and just start adding in everything else from there. My daughter is 6 so is getting to the point where you can't easily find decent used clothes (and believe me I was all about garage sales and consignment and thrift stores) and then as mentioned above you have braces, haircuts, family health insurance, etc. etc.

I also think Mustachians tend to underestimate costs at the end of life. Having had some family members in their late 80s-90s pass away recently, you'd better plan on having a lot of family nearby willing to help you out and/or large sums of money stashed away to hire help.  My grandfather recently died - both he and my grandmother (who died a few years ago) stayed at home but that was only possible since they had five kids nearby who all really pitched in and had the financial wherewithal for a large amount of additional paid caregiving as well. But even my grandfather was down to about $200K in non-house assets at his death. So he didn't run out of money but it's pretty tough to predict - being 90 and about to run out of money or forced to leave the house I wanted to stay in would not be a good feeling.

[talltexan]

I'll definitely get there, but it may actually be some time after I FIRE.

Sure, but that's pretty meaningless--basically everyone born this year should get there (in nominal dollars).  Within their lifetime, median annual household income will be nearly 1MM (using inflation figures for the last 80 years, and the fact that it's currently about 53k).

All of us in this thread that don't die early should easily be millionaires.  :D

I'm curious about how your belief on these inflation forecasts has changed. They seem very high to me.

[Prairie Stash]

I'll definitely get there, but it may actually be some time after I FIRE.

Sure, but that's pretty meaningless--basically everyone born this year should get there (in nominal dollars).  Within their lifetime, median annual household income will be nearly 1MM (using inflation figures for the last 80 years, and the fact that it's currently about 53k).

All of us in this thread that don't die early should easily be millionaires.  :D

I'm curious about how your belief on these inflation forecasts has changed. They seem very high to me.

That is pretty high, but the underlying point is valid. Most of my grandchildren will be millionaires. Rule of 72 divided by 3% (inflation) means median income doubles every 24 years. 96 years, 16 times present, means $53 is $848k.

A millionaire is just a quick way of saying you have 20 times the median income saved currently. It use to be 40 times (pick your year), a much bigger deal. Its rather a longwinded statement saying I want 35 times the median income, I think 2 million is the new millionaire, from my view it should be based on a multiple of the median income.

[talltexan]

I'll definitely get there, but it may actually be some time after I FIRE.

Sure, but that's pretty meaningless--basically everyone born this year should get there (in nominal dollars).  Within their lifetime, median annual household income will be nearly 1MM (using inflation figures for the last 80 years, and the fact that it's currently about 53k).

All of us in this thread that don't die early should easily be millionaires.  :D

I'm curious about how your belief on these inflation forecasts has changed. They seem very high to me.

That is pretty high, but the underlying point is valid. Most of my grandchildren will be millionaires. Rule of 72 divided by 3% (inflation) means median income doubles every 24 years. 96 years, 16 times present, means $53 is $848k.

A millionaire is just a quick way of saying you have 20 times the median income saved currently. It use to be 40 times (pick your year), a much bigger deal. Its rather a longwinded statement saying I want 35 times the median income, I think 2 million is the new millionaire, from my view it should be based on a multiple of the median income.

I really like the measure of median income you describe. Of course, median wealth and median income can be based on totally different compositions of households. It's possible to live in a world in which accumulating wealth is very difficult for all but a few.

It's also possible that housing will appreciate relative to most other assets to the point where many people have that 20X, but it's mostly equity in a home.

[Bird In Hand]

Spendypants here.  Forty-ish, married with three kids in private school, $1.1MM invested in before-tax retirement accounts, and live in a moderately high COL area.  We spend lavishly on groceries ($15k+, partially because we buy so much from local farmers).  Beyond that -- and private school -- we're pretty frugal and don't buy a lot of useless stuff.

Target 0 (double job loss immediately): FIRECalc says we could withdraw ~$41k starting right now, for 50 years, with a 96% success rate (assuming 75% of our expected SS, or $33k with no SS).  I think it would be possible, but challenging, to scale back our spending and live on $41k/year.  Still, it's comforting to know we're basically already set for life if push came to shove.

Target 1 (earliest realistic): If we work for three more years until the mortgage is paid off, FIRECalc says $55k @ 96% success, or $46k without SS.  Coincidentally, our actual non-mortgage, non-tuition spending is about $55k right now. 

Target 2 (most likely): Neither my wife nor I are interested in cutting our budget to the bone, and we'd both feel comfortable with a pretty chunky buffer.  In addition, we both still enjoy our jobs, and our employers offer some really nice benefits like 50% off college tuition for our kids.  What we would like to do is have me switch to part time after the mortgage is paid off in 3 years (she's already part time), and spend the extra time together, with the kids, volunteering, doing projects around the home, etc.  Assuming I continue 1/2 time until I'm 55 and contribute minimally to retirement savings to receive the employer match, FIRECalc says $87k @ 96% success, or $77k without SS.

[SimplyFinanciallyFree]

$1,000,000 in investments (net worth is already $1mil) for two of us.  We have real estate income covering about 45% of our expenses and plan to work part time in the first 5+ years to keep busy so our withdrawal rate will be very low in the first few years.  I would rather play it safe and have extra in case something big comes up.

[arebelspy]

I'll definitely get there, but it may actually be some time after I FIRE.

Sure, but that's pretty meaningless--basically everyone born this year should get there (in nominal dollars).  Within their lifetime, median annual household income will be nearly 1MM (using inflation figures for the last 80 years, and the fact that it's currently about 53k).

All of us in this thread that don't die early should easily be millionaires.  :D

I'm curious about how your belief on these inflation forecasts has changed. They seem very high to me.

That is pretty high, but the underlying point is valid. Most of my grandchildren will be millionaires. Rule of 72 divided by 3% (inflation) means median income doubles every 24 years. 96 years, 16 times present, means $53 is $848k.

Yep. And, as I stated, using inflation for the last 80 years, not a flat "3%" assumption.  That may, or may not, be correct, but that was the figures I was using, as stated.  :)

[talltexan]

Suppose inflation only averages 2% per year (it's been less than that for nearly all of the past nine years). Now instead of doubling in 24 years, we're doubling in 36.

Combine that with our (hopefully) mustachian children delaying child birth until they're FIRE'd at 35, and you'll see a generation slip.

Of course, these hypothetically mustachian children will probably think I was trashy for having them at age 32 and continuing to work :-)

[arebelspy]

Sure, if you change assumptions, you can change the conclusion.

:)