Can we afford to retire now?

[Anonymous]

Anonymous wrote:My insurance through the affordable health care act (ACA) at age 63 is $1300 per month with a $7000 deductible. That is for 1 person. I am on a silver plan, the cheapest. I get no rebate as you get no discount if your pay is gross over $49,000 per year in my state.

And in my state, for a 56 yo, the silver plan (EPO) is $1600/month (it was only 1300 last year).
and yes the dedcubitle is $7K/$14K (ind/family).

At 63, it would be $2300/month for the same plan. And yes this is just medical, no dental or vision.
So at 63, we would be paying $4.6K for two of us and let's assume the deductible as well so another $1100/month (not difficult to hit a deducible like that when you are 55+, one medical issue, like arthritis and needing a few X-rays/cat scans or MRI and you are there.

So $5.7K per month for medical insurance and expenses monthly.

It's not cheap and you need to price it out and be aware of the ever increasing costs and don't expect it to be "fixed" anytime soon---we need single payer but that's not likely

[Anonymous]

Anonymous wrote:I think you need to wait until after college. Hopefully your kids will launch well, get off your health plan. Then the cost would be more manageable. I don’t think you need to keep saving, so if you’re still earmarking a ton to retirement accounts I think you can start enjoying your money now, just let your assets grow. But yeah, personally I would wait until college is paid and done.

I'd wait to "start really enjoying their money" until they are done funding high school at $90K/year and have enough saved for the "rest of college expenses". Then, sure continue to save but also step back a bit and enjoy some of it, at $650K they should be able to do both. But until you get rid of the tuition costs, it's harder

[Anonymous]

Given that you seem to want to be retiring, I would seriously ask myself about my spending priorities. Is $90k/year private school tuition a priority? How much I am willing to spend on college? Do I need to keep the big fat mortgage or should I downsize?

[Anonymous]

An alternative would be for one of you to retire and the other to continues to work so you don't have to dip into retirement savings, which will continue to grow, and the other will be able to cover medical insurance.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:We are 50.

How will you access the money in your retirement accounts before you turn 59 1/2? It usually comes with a penalty.

OP said they have $1 million liquid.

Not even close to enough.

[Anonymous]

I would not be comfortable in your situation. I am on the low end of DCUM wealth/income scale, and I don't have plans for a lavish retirement.... but my number for retiring at 55 is at least 5 million plus a fully paid off mortgage. (That isn't going to happen for me.... but I dare to dream.)

[Anonymous]

Anonymous wrote:I would not be comfortable in your situation. I am on the low end of DCUM wealth/income scale, and I don't have plans for a lavish retirement.... but my number for retiring at 55 is at least 5 million plus a fully paid off mortgage. (That isn't going to happen for me.... but I dare to dream.)

Are you married?

I'm just wondering if that $5 million is household assets of two people or just for you? And you either don't have a spouse or they have their own pot of $.

I'm 55 with $4 million of my own, but then my spouse also has their own pot of money ($4 million), so I'm thinking it is doable.

It better be! I've already annouced my retirement.

[Anonymous]

Anonymous wrote:

Anonymous wrote:I would not be comfortable in your situation. I am on the low end of DCUM wealth/income scale, and I don't have plans for a lavish retirement.... but my number for retiring at 55 is at least 5 million plus a fully paid off mortgage. (That isn't going to happen for me.... but I dare to dream.)

Are you married?

I'm just wondering if that $5 million is household assets of two people or just for you? And you either don't have a spouse or they have their own pot of $.

I'm 55 with $4 million of my own, but then my spouse also has their own pot of money ($4 million), so I'm thinking it is doable.

It better be! I've already annouced my retirement.

Obviously with $8M it's "doable", but it does depend upon your yearly expenses. We need to know your mortgage/insurance/proptax/maintenance, car expenses, food, travel, HEALTHCARE, and everything else to say with 100% certainty. Because if you want to spend $500K/year, it's probably not as doable

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:I would not be comfortable in your situation. I am on the low end of DCUM wealth/income scale, and I don't have plans for a lavish retirement.... but my number for retiring at 55 is at least 5 million plus a fully paid off mortgage. (That isn't going to happen for me.... but I dare to dream.)

Are you married?

I'm just wondering if that $5 million is household assets of two people or just for you? And you either don't have a spouse or they have their own pot of $.

I'm 55 with $4 million of my own, but then my spouse also has their own pot of money ($4 million), so I'm thinking it is doable.

It better be! I've already annouced my retirement.

Obviously with $8M it's "doable", but it does depend upon your yearly expenses. We need to know your mortgage/insurance/proptax/maintenance, car expenses, food, travel, HEALTHCARE, and everything else to say with 100% certainty. Because if you want to spend $500K/year, it's probably not as doable

I guess at this point I just want clarification that when people say that they have a particular number that they are shooting for for retirement, is that a household wealth number (both spouses) or just you as an individual, not including the assets and debts of your spouse?

But yes, lots of details beyond that-- for example we are still paying a mortgage but it's only $2k per month, and I'll carry federal employee health insurance into retirement, which is still an expense, but less than what it costs through ACA.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:I would not be comfortable in your situation. I am on the low end of DCUM wealth/income scale, and I don't have plans for a lavish retirement.... but my number for retiring at 55 is at least 5 million plus a fully paid off mortgage. (That isn't going to happen for me.... but I dare to dream.)

Are you married?

I'm just wondering if that $5 million is household assets of two people or just for you? And you either don't have a spouse or they have their own pot of $.

I'm 55 with $4 million of my own, but then my spouse also has their own pot of money ($4 million), so I'm thinking it is doable.

It better be! I've already annouced my retirement.

Obviously with $8M it's "doable", but it does depend upon your yearly expenses. We need to know your mortgage/insurance/proptax/maintenance, car expenses, food, travel, HEALTHCARE, and everything else to say with 100% certainty. Because if you want to spend $500K/year, it's probably not as doable

I guess at this point I just want clarification that when people say that they have a particular number that they are shooting for for retirement, is that a household wealth number (both spouses) or just you as an individual, not including the assets and debts of your spouse?

But yes, lots of details beyond that-- for example we are still paying a mortgage but it's only $2k per month, and I'll carry federal employee health insurance into retirement, which is still an expense, but less than what it costs through ACA.

yes, if you have access to federal (or any company health insurance) thru retirement or age 65, even if retired, your medical costs will be much lower. We will pay $3-3.5K more per month than our current health insurance when we have to use the ACA (and then the deductible will be $7/14K rather than $1.5/$3K) , even on cobra it will still be $1.5K/month cheaper (and the similarly lower deductible) than the ACA. We can afford it, but I suspect many do not realize they might be spending $40K+ on healthcare until they turn 65 (we spend about $5-7K per year now including copays/everytihgn until we max out) So if you are spending an extra $35K+ for 10+ years that's something to consider.

[Anonymous]

Anonymous wrote:No. You have $4m in investible assets, which means you could draw down $160k per year, and you'd have to pay taxes, tuition, and your mortgage out of the $160k annual spend. If I were you, I'd work for at least two more years to cover the $90k per year in private school expenses and see where they land for college, and then reassess.

+1 We will have about $3.8 mil when we retire next year (I'm 56; spouse is 62), two kids in college by then with 529 funded to what they need.

ACA insurance is ridiculously expensive, even with the subsidies but even more so without, and who knows what the Rs will do about the subsidies.

PITI is $2300. Monthly expenses all in without having to budget is about $10K, with travel about $12K.

No way would I retire at 50 with only $3mil and two kids, and paying for private school at $90K/yr. Insane.

[Anonymous]

Anonymous wrote:

Anonymous wrote:No. You have $4m in investible assets, which means you could draw down $160k per year, and you'd have to pay taxes, tuition, and your mortgage out of the $160k annual spend. If I were you, I'd work for at least two more years to cover the $90k per year in private school expenses and see where they land for college, and then reassess.

+1 We will have about $3.8 mil when we retire next year (I'm 56; spouse is 62), two kids in college by then with 529 funded to what they need.

ACA insurance is ridiculously expensive, even with the subsidies but even more so without, and who knows what the Rs will do about the subsidies.

PITI is $2300. Monthly expenses all in without having to budget is about $10K, with travel about $12K.

No way would I retire at 50 with only $3mil and two kids, and paying for private school at $90K/yr. Insane.

OP has 4 million, not 3.

[Anonymous]

Anonymous wrote:

Anonymous wrote:How much is your mortgage?

We are aiming for $250k/year after paying off mortgage and kids’ college costs.

Mortgage and property tax is $4000 a month


Our HHI is $650 k. I forgot to mention that too.

Looks like we need to keep working! Ugh

Who is the highest earner?

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:I would not be comfortable in your situation. I am on the low end of DCUM wealth/income scale, and I don't have plans for a lavish retirement.... but my number for retiring at 55 is at least 5 million plus a fully paid off mortgage. (That isn't going to happen for me.... but I dare to dream.)

Are you married?

I'm just wondering if that $5 million is household assets of two people or just for you? And you either don't have a spouse or they have their own pot of $.

I'm 55 with $4 million of my own, but then my spouse also has their own pot of money ($4 million), so I'm thinking it is doable.

It better be! I've already annouced my retirement.

Obviously with $8M it's "doable", but it does depend upon your yearly expenses. We need to know your mortgage/insurance/proptax/maintenance, car expenses, food, travel, HEALTHCARE, and everything else to say with 100% certainty. Because if you want to spend $500K/year, it's probably not as doable

I guess at this point I just want clarification that when people say that they have a particular number that they are shooting for for retirement, is that a household wealth number (both spouses) or just you as an individual, not including the assets and debts of your spouse?

But yes, lots of details beyond that-- for example we are still paying a mortgage but it's only $2k per month, and I'll carry federal employee health insurance into retirement, which is still an expense, but less than what it costs through ACA.

yes, if you have access to federal (or any company health insurance) thru retirement or age 65, even if retired, your medical costs will be much lower. We will pay $3-3.5K more per month than our current health insurance when we have to use the ACA (and then the deductible will be $7/14K rather than $1.5/$3K) , even on cobra it will still be $1.5K/month cheaper (and the similarly lower deductible) than the ACA. We can afford it, but I suspect many do not realize they might be spending $40K+ on healthcare until they turn 65 (we spend about $5-7K per year now including copays/everytihgn until we max out) So if you are spending an extra $35K+ for 10+ years that's something to consider.

Isn't it nice how healthcare indentures people to work full time? Even if they can make do with part time jobs or even retire if they don't mind living modestly. It's especially designed to f people 50+.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:How much is your mortgage?

We are aiming for $250k/year after paying off mortgage and kids’ college costs.

Mortgage and property tax is $4000 a month


Our HHI is $650 k. I forgot to mention that too.

Looks like we need to keep working! Ugh

Yes, because for a couple with a HHI of $650K, you don't have "much saved". A lot has likely been going to private schools. That was a choice, so now you need to finish that and spend 3-5 years saving aggressively.

You need to plan for healthcare for until age 65---that could be $40K+ easily for just 2 of you (when you include the premiums and actually what your copays/deducibles are---even if you don't see a doctor much now, once you hit 50 even if very healthy that starts to change)

Well, we didn’t have such a high income until fairly recently so that’s why we don’t have ‘much saved.’

How many times will you post the same story? I’ve read this at least three times on this board…