Can I retire? Seriously, this is not a flex, this is largely life insurance money and an inheritance I wish I never received. Age 28. Single - but hope to have 1-2 children one day. Currently in HCOL, but open to consider moving to LCOL
Current income - 190k. 401k - 160k, Primary home - 750k net equity (TCO is ~2k/mo), Rental property - 200k net equity & 1k/mo net profit, Brokerage - 475k, inherited IRA - 300k, other investment - 50k @12% return rate, checking/savings - 15k, HSA - 15k

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On the surface it doesn’t look like enough, depending on how you want to provide for your future children. Don’t underestimate those costs

Mathematically could you make it work? Maybe, but you’d be significantly limiting the type elf lifestyle you/ your future family would be able to live.

You’re in an incredible position currently and aiming for 35-40 to retire would allow you to invest significantly more and see how the current economic environment plays out over a few more years. You also have the luxury of taking a lower stress job even at a pay cut if that’s what you want.

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I think you need to define what you want. Traveling the world will run through the money fast with a family.

I wouldn’t plan on being a stay at home parent until you actually try it. It’s way harder than what people without children envision. Way more difficult than working.

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Sorry not enough to retire. Also you don't even know what your future expenses are going to be. I would budget for at least 100k in expenses for LCOL for a family of 4 including medical. Which means you're looking at about $3M to retire excluding primary home equity (unless you're ok selling)

likesmart

Or just marry rich

funny

You still have a ways off. Your primary home equity is the biggest opportunity to grow your net wort, but you missed the low interest rates. Primary home exclusion is $250k for a single filer, so you’d pay long term cap gains if you sold, which isn’t helpful.

If you left your job, your biggest expense would probably be health insurance, which might not be too bad now, but would be expected to rise. I’d say you still need around $500k in working investments to consider retiring, which you could potentially do in 3 to 5 years depending on how aggressive you get.

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Makes sense, circumstances change.

I still think a HELOC at 6 or 7% would be better to get your stale equity working harder elsewhere. If you could find another 12% private investment like you did previously, you’re making 5% above your costs. Getting $500k or $600k working at 5% will help you get to retirement faster.

funny

What’s your annual spend today and what do you envision it being with spouse + 1-2 kids? Private school?

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Yeah, and those unknowns make me feel as if I’m stuck

Primary home has extra bedrooms that can be rented out making it net zero cost to own and live in.

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Not sure why you had to reiterate your comments, SC1. I was affirming Ops statement about close friends.

Your point was well received the first time

Would leveraging the available funds from brokerages and inherited IRA I need to draw from to purchase rental properties with cash flow be a better play then keeping it all in index funds, as is today? My current rental required 80k cash to get $700 in profit.

The 700 doesn’t really factor appreciation, principal, etc. but yes, finding additional properties where the math would work well enough at current interest rates is hard.

You have $1M liquid, $1k passive monthly income, and a roof over your head.

If it was you solo I’d say you could do a 15 year retirement (and then you’d urgently need to get a job). But kids are incredibly expensive.

Unknowns:
Expense profile
If you would have a SO, if you would support them, or if they would keep working.

What are your goals for retirement? What’s the draw?

Asking as there are plenty of ways to have a great life while also working

Really depends on your monthly expenses. Just note once you have kids you may need to move to a bigger home and daycare for 1 kid in MCOL is $1,500 per month.

Why not take a sabbatical? Mini-retirement then regroup

I think it's okay to do without always having the end in sight. Sounds like you're burned out. Tim Ferriss talks about this a lot.

How do you get a guaranteed 12% return?

Loaned money to a small business and carry collateral to secure the investment. They needed capital for rolling inventory.

And here I am with only 49K in a retirement account 😅. Geez

Please don’t say this. Even lightheartedly. It’s hurts so much to lose family and come to terms with how much they will miss and how different your life will be going forward without them there. The money is just another reminder of how much time was taken away.

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