If your HHI is $450k, what is your retirement number

[Anonymous]

Let’s also say your age/ older spouse/ higher earning spouse is between 45 and 50. We’re thinking around $5M. I know a lot of people live on a lot lesser hence this question is directed to a specific group. We’d love to be able to leave our kids something as well.

[Anonymous]

When do you think you will retire?

We have a little higher HHI. Plan to work to about 58 (in 4 years). Our number is $5 million in 401ks and $1 million in taxable. This does not include the equity in our current home of about $700,000.

[Anonymous]

It doesn’t matter what you make. It matters what you spend, and what you plan to spend in retirement. $5M is only $150k/year at a 3% withdrawal rate. Is that enough for you? Only you know the answer.

We make $350k (but save a lot) and our number is $8M.

[Anonymous]

OP here. I am 42 and DH is 48. We dont have expensive tastes and don’t have a reason to retire before 60. Interesting that folks dont think $5M is sufficient. Looking to hear from more people. We should exceed $5M in investable assets easily but I’m trying to get to a mental number when we know we’re done even if we chose to continue working after that.

[Anonymous]

Anonymous wrote:OP here. I am 42 and DH is 48. We dont have expensive tastes and don’t have a reason to retire before 60. Interesting that folks dont think $5M is sufficient. Looking to hear from more people. We should exceed $5M in investable assets easily but I’m trying to get to a mental number when we know we’re done even if we chose to continue working after that.

How much do you spend each month? Will your mortgage be paid off in retirement? 5M might be enough if your monthly spending excluding your mortgage payment is less than 13k per month

[Anonymous]

Anonymous wrote:

Anonymous wrote:OP here. I am 42 and DH is 48. We dont have expensive tastes and don’t have a reason to retire before 60. Interesting that folks dont think $5M is sufficient. Looking to hear from more people. We should exceed $5M in investable assets easily but I’m trying to get to a mental number when we know we’re done even if we chose to continue working after that.

How much do you spend each month? Will your mortgage be paid off in retirement? 5M might be enough if your monthly spending excluding your mortgage payment is less than 13k per month

+1. You told us what you make but not what you spend or plan to spend OP. That is what a “retirement number” is derived from, not current HHI.

[Anonymous]

I'm 51 and husband is 56. We make about $300k down from about $325K. Husband was laid off recently and found another job which didn't pay as well.

Our net worth is ~$5.4M investments/cash, $1M home, $600K college savings.

While I think we could retire now if we had to as 4% of 5.4M is $216K, 80% of this after taxes is $173K assuming health insurance of $30K that leaves about $12K per month in spending. So I think we are at FIRE now- but we won't exercise it yet.

$7M is really our magic number, which we may be able to achieve in the next 4 years depending on how the stock market does, but we might reconsider if we have another job loss which is not unlikely.

At $7M, we can withdraw the same $216K but that's only 3% so we have a better buffer in the stock market goes down. We should theoretically be adding each year to our net worth if we withdraw 3% (after taxes). If we decide to withdraw 4% some years for kids weddings, helping with a DPs etc, house upgrades, new or used car we will still feel good- that would give us an additional $50K per year for those years. I personally think with $7M, we won't struggle.

[Anonymous]

Anonymous wrote:I'm 51 and husband is 56. We make about $300k down from about $325K. Husband was laid off recently and found another job which didn't pay as well.

Our net worth is ~$5.4M investments/cash, $1M home, $600K college savings.

While I think we could retire now if we had to as 4% of 5.4M is $216K, 80% of this after taxes is $173K assuming health insurance of $30K that leaves about $12K per month in spending. So I think we are at FIRE now- but we won't exercise it yet.

$7M is really our magic number, which we may be able to achieve in the next 4 years depending on how the stock market does, but we might reconsider if we have another job loss which is not unlikely.

At $7M, we can withdraw the same $216K but that's only 3% so we have a better buffer in the stock market goes down. We should theoretically be adding each year to our net worth if we withdraw 3% (after taxes). If we decide to withdraw 4% some years for kids weddings, helping with a DPs etc, house upgrades, new or used car we will still feel good- that would give us an additional $50K per year for those years. I personally think with $7M, we won't struggle.

What about social security? And are any of your investments in tax advantaged accounts?

[Anonymous]

Anonymous wrote:I'm 51 and husband is 56. We make about $300k down from about $325K. Husband was laid off recently and found another job which didn't pay as well.

Our net worth is ~$5.4M investments/cash, $1M home, $600K college savings.

While I think we could retire now if we had to as 4% of 5.4M is $216K, 80% of this after taxes is $173K assuming health insurance of $30K that leaves about $12K per month in spending. So I think we are at FIRE now- but we won't exercise it yet.

$7M is really our magic number, which we may be able to achieve in the next 4 years depending on how the stock market does, but we might reconsider if we have another job loss which is not unlikely.

At $7M, we can withdraw the same $216K but that's only 3% so we have a better buffer in the stock market goes down. We should theoretically be adding each year to our net worth if we withdraw 3% (after taxes). If we decide to withdraw 4% some years for kids weddings, helping with a DPs etc, house upgrades, new or used car we will still feel good- that would give us an additional $50K per year for those years. I personally think with $7M, we won't struggle.

+1 We are similar with 5.6M in investments and cash + 500K in our house. We want to get to 7M if possible.

[Anonymous]

Anonymous wrote:I'm 51 and husband is 56. We make about $300k down from about $325K. Husband was laid off recently and found another job which didn't pay as well.

Our net worth is ~$5.4M investments/cash, $1M home, $600K college savings.

While I think we could retire now if we had to as 4% of 5.4M is $216K, 80% of this after taxes is $173K assuming health insurance of $30K that leaves about $12K per month in spending. So I think we are at FIRE now- but we won't exercise it yet.

$7M is really our magic number, which we may be able to achieve in the next 4 years depending on how the stock market does, but we might reconsider if we have another job loss which is not unlikely.

At $7M, we can withdraw the same $216K but that's only 3% so we have a better buffer in the stock market goes down. We should theoretically be adding each year to our net worth if we withdraw 3% (after taxes). If we decide to withdraw 4% some years for kids weddings, helping with a DPs etc, house upgrades, new or used car we will still feel good- that would give us an additional $50K per year for those years. I personally think with $7M, we won't struggle.

Op here. Thank you this is what I’m looking for. As a first gen immigrant, I cannot refer to what my parents or other family did. $5m seems like a lot of money, but this puts it in perspective that it’s not as much as it seems. It’s also hard to think of spending weI’ll have 15 years down the line when the kids are out of the house or know what inflation is going to be.

[Anonymous]

For context, DINK with HHI of about 280. 5 is our number. 50 and 52 and I think we can get there in about 9 years. I don't think we will have jobs that long. 3 is we could do it if we had to but would probably stress about the prospect and that's about 4 years away. We're at 2 now.

[Anonymous]

Anonymous wrote:

Anonymous wrote:I'm 51 and husband is 56. We make about $300k down from about $325K. Husband was laid off recently and found another job which didn't pay as well.

Our net worth is ~$5.4M investments/cash, $1M home, $600K college savings.

While I think we could retire now if we had to as 4% of 5.4M is $216K, 80% of this after taxes is $173K assuming health insurance of $30K that leaves about $12K per month in spending. So I think we are at FIRE now- but we won't exercise it yet.

$7M is really our magic number, which we may be able to achieve in the next 4 years depending on how the stock market does, but we might reconsider if we have another job loss which is not unlikely.

At $7M, we can withdraw the same $216K but that's only 3% so we have a better buffer in the stock market goes down. We should theoretically be adding each year to our net worth if we withdraw 3% (after taxes). If we decide to withdraw 4% some years for kids weddings, helping with a DPs etc, house upgrades, new or used car we will still feel good- that would give us an additional $50K per year for those years. I personally think with $7M, we won't struggle.

What about social security? And are any of your investments in tax advantaged accounts?

Almost everything is in 401Ks. We have Roths from our early years but not much. Of course, social security will kick in and that should give us an extra $2-$4K per month- but that seems so far in the future. I see that as another buffer against the stock market.

[Anonymous]

Anonymous wrote:For context, DINK with HHI of about 280. 5 is our number. 50 and 52 and I think we can get there in about 9 years. I don't think we will have jobs that long. 3 is we could do it if we had to but would probably stress about the prospect and that's about 4 years away. We're at 2 now.

As a DINK, you should be fine. I always thought when I got through daycare and had college saved that I'd be home free. Car, car insurance and activities for older children are VERY expensive.

[Anonymous]

Anonymous wrote:

Anonymous wrote:I'm 51 and husband is 56. We make about $300k down from about $325K. Husband was laid off recently and found another job which didn't pay as well.

Our net worth is ~$5.4M investments/cash, $1M home, $600K college savings.

While I think we could retire now if we had to as 4% of 5.4M is $216K, 80% of this after taxes is $173K assuming health insurance of $30K that leaves about $12K per month in spending. So I think we are at FIRE now- but we won't exercise it yet.

$7M is really our magic number, which we may be able to achieve in the next 4 years depending on how the stock market does, but we might reconsider if we have another job loss which is not unlikely.

At $7M, we can withdraw the same $216K but that's only 3% so we have a better buffer in the stock market goes down. We should theoretically be adding each year to our net worth if we withdraw 3% (after taxes). If we decide to withdraw 4% some years for kids weddings, helping with a DPs etc, house upgrades, new or used car we will still feel good- that would give us an additional $50K per year for those years. I personally think with $7M, we won't struggle.

Op here. Thank you this is what I’m looking for. As a first gen immigrant, I cannot refer to what my parents or other family did. $5m seems like a lot of money, but this puts it in perspective that it’s not as much as it seems. It’s also hard to think of spending weI’ll have 15 years down the line when the kids are out of the house or know what inflation is going to be.

No problem. Actually, you helped me too as I've been thinking about this a lot recently and you helped me articulate why $7M is a good number. We don't use a financial planner so we are DIY.

[Anonymous]

What difference does income have to do with retirement number?

It is how much you spend.

My income went from 160k to 450k over a period of time but my spending stayed the same. Same starter home, same used car.