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Additional Posts in FIRE Financial Independence Retire Early
Decided to payoff my mortgage.
Real Estate Rookie podcast thirsty for subs
Mentor
Are investment properties good for retirement?
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Sounds like you’re well on your way. With the understanding that prime earning years are still ahead of you and barring any major lifestyle changes, you could easily grow this 3-4x by the time you retire. What’s the NW breakdown (401k, stocks, home equity, etc.)?
Mentor
I think this could go either way. I used to include them at current sale value as they are assets that can be sold, downsized, combined to one especially if you don’t need them when you fire. I don’t include them anymore. Partially because my cars aren’t worth that much and it isn’t that material to my goals. I never included other personal property even though some of it is not needed and could be sold. I think as long as you aren’t considering them income producing assets (assuming they are not) include or not as you wish.
Subject Expert
Is 240k HHI your take home or pre-tax? Are you saving $90k or less?
Healthcare, you just budget like any other expense.
$25k is probably a good estimate for now (in today’s dollars)
You would probably qualify for some subsidies based on low income after you retire at 50, though this is uncertain. Politics could easily change this.
25x expenses of $150k is $3.75m in today’s dollars.
Gut feeling, I’d say you are roughly on track for this. Could run some numbers once we know your saving amount per year.
There are a lot of big variables: Will you get pay rises, will you increase spending, how will the market perform.
17 years is a long time
Subject Expert
FYI - I was on similar path to you. Now 12 years later
At 33 I was
- Earning about the same as you
- slightly less assets
- Spending slightly less
My income only rose only slightly above inflation.
Now have $2.2m investments, and roughly on track to retire at 50, spending around $125k. House would nearly be paid off at that point.
(All numbers again in today’s dollars, so it’s easier to compare)
Not enough info here.
You say the most important thing is saving rate and then don’t actually provide it. How much do you save including stuff like employer 401k matches. You give your spend now but don’t talk about goals for future. Do you want to save for you kids college or have other financial goals that don’t align to what you spend now? Do you plan to have more kids?
Your progress is great but if you want guidance on how set up you are to retire at 50, you need to get more tactical.
I provided my average annual spend, along with my annual income. Pre-tax savings rate is $90k/$240k = 37.5%. MFJ for taxes.
I get a 6% dollar for dollar 401k match which I max annually.
I have $10k in 529 and invest $2k/year into it, and would at most have one more child, God willing.
Can always get a lessstressful job at a school or similar for medical . Many do this
Not true. Someone can save $0 but exit the company they built 5 years later for 20M and just like that they FIRE’d
Though a possible scenario, this is certainly the minority case.
Subject Expert
There is something weird going on here.
The OP says his pretax HHI is $240k, that he spends $150k, and that he saves $90k.
$150k plus $90k is $240k.
What about taxes?
OP, are you actually saving $90k a year? How? In what forms? How are you paying your income taxes?
Subject Expert
If your average real return on your investments (above inflation) is 5%.