Anonymous wrote:

Anonymous wrote:

Anonymous wrote:PP again.. At the highest level, you need 25 times your planned annual expenses saved up to not risk running out of money (the 4% rule).

Don’t forget you will be taxed for the income you take out of 401ks, so you need to factor that in as well.

In this 4% rule do the planned annual expenses include taxes? I assume it would.

All expenses. Imagine you have $5mil. 4% is $200,000. This is the total amount you get per year for ALL cash outflows - Mortgage, Health insurance, Taxes, groceries, college, vacation, etc.

Anonymous wrote:

Anonymous wrote:PP again.. At the highest level, you need 25 times your planned annual expenses saved up to not risk running out of money (the 4% rule).

Don’t forget you will be taxed for the income you take out of 401ks, so you need to factor that in as well.

In this 4% rule do the planned annual expenses include taxes? I assume it would.

Anonymous wrote:DH and I both feel in poor position about our jobs. We have significant expenses (3 kids in or near college).

I want to figure out scenarios where one or both of us lose jobs.

OP, if *both* of you do lose your jobs, keep in mind that your children might qualify for more in need-based financial aid for college.

Is your house paid off? I would stop contributing to a college fund and start paying off your house. If you both lose your jobs, you would do far better having housing secure.

Anonymous wrote:Op here. I should say that both DH are mid fifties and have been trying to get new jobs with no success for a couple of years. So losing our jobs now could potentially be permanent in terms of the income level we have now. It’s more like a 30 year retirement scenario. If we lost our jobs this year ideally we would live off our non IRAs until at least 58 right? Should I factor in depleting our taxable savings first? We have in 529s about half of a private college expense saved. Other big expense is private high school (4 years tuition). Anyone have idea how much medical, dental,vision insurance is privately per year for family of 5?

You will come around eventually to a job that's not at "the income level you are at now". I did and so did many others. At least one of you should eat your pride and get a job that will last until at least your kids are out of college regardless of the pay. This will provide for medical insurance and other benefits that you otherwise won't have. You could continue with your 401K/IRA savings as well.

Ditch the private school asap. Living where we all live, it's stupid to spend money on a private.

DH just quit his job (and I haven't worked a full-time job in a long time) so we have been thinking about OP's questions for our family of 5.

We feel pretty confident taking about 3% of our taxable investment accounts per year (for us that is about $150k per year in income). Over the last year we've switched from a portfolio that was nearly 100% equities to one that includes some bonds for income. We'll hold off on tapping retirement accounts/TSP because of the tax penalties. We also have a small fed pension coming plus Social Security eventually.

We get 18 months of Cobra for health insurance. The cost will be $26k a year for our family of 5. A comparable plan purchased on MD Health Connection is about 10k more per year but there were also cheaper options, particularly Kaiser HMO's. Hopefully one of us has a job that provides health insurance within the next 18 months.

I don't know about your housing but we can save a considerable amount by downsizing, especially since our kids are either in college or will be shortly. We have a large house that is very expensive to maintain and we want to move out of the area.

Our kids' 529's are fully funded but if they weren't I would not be contributing any more to them.

Anonymous wrote:Op here. I should say that both DH are mid fifties and have been trying to get new jobs with no success for a couple of years. So losing our jobs now could potentially be permanent in terms of the income level we have now. It’s more like a 30 year retirement scenario. If we lost our jobs this year ideally we would live off our non IRAs until at least 58 right? Should I factor in depleting our taxable savings first? We have in 529s about half of a private college expense saved. Other big expense is private high school (4 years tuition). Anyone have idea how much medical, dental,vision insurance is privately per year for family of 5?

I'd say, yes, use taxable savings first. If your 529s cover half of a private college then that probably means they'd cover all of an in-state public. If you are still putting money in them, might be worth switching that savings to non-529s so you can use the money for other expenses without penalty if necessary. And, if iDH or I lost our job and didn't expect to be able to get another, child would be switching from private high school to public immediately.

Op here. I should say that both DH are mid fifties and have been trying to get new jobs with no success for a couple of years. So losing our jobs now could potentially be permanent in terms of the income level we have now. It’s more like a 30 year retirement scenario. If we lost our jobs this year ideally we would live off our non IRAs until at least 58 right? Should I factor in depleting our taxable savings first? We have in 529s about half of a private college expense saved. Other big expense is private high school (4 years tuition). Anyone have idea how much medical, dental,vision insurance is privately per year for family of 5?

I signed up for the "Personal Capital" app based on a recommendation here, and the desktop version has a retirement calculator that lets you run through different scenarios. It's a "consolidator", so you have to set up your logins inside the app to get the most accurate information. They do have an option to manually enter data, so I did that with some of dh's accounts that I don't have the logins for.

Anyway, I think their calculator will do what you want.

Anonymous wrote:DH and I both feel in poor position about our jobs. We have significant expenses (3 kids in or near college).

I want to figure out scenarios where one or both of us lose jobs. We saved and are lucky to have significant $ saved
But it is various account types (iras, taxable) plus we have SS and a small pension that
Will eventually kick in.

Is there a tool or documented approach that will help us see how much income we are looking
At per year after tax. Consider medical expenses etc. it all seems daunting. I don’t want to limit ourselves now to
No real benefit later.

Only the magic 8 ball can give you an answer with details like this

Anonymous wrote:PP again.. At the highest level, you need 25 times your planned annual expenses saved up to not risk running out of money (the 4% rule).

The 4% rule is for a 30 year retirement I think not a 50 year retirement.

OP it is east to run numbers what is hard is thinking about uncertainties. How confortable are you with projections of investment returns, and inflation. What will you do for health insurance, how do you budget for health care costs over a 50 year period. Etc.

There are lots of websites that will help model or discuss these isssues. You might look on bogleheads or moneymustache or for FIRE.

Anonymous wrote:PP again.. At the highest level, you need 25 times your planned annual expenses saved up to not risk running out of money (the 4% rule).

Don’t forget you will be taxed for the income you take out of 401ks, so you need to factor that in as well.

PP again.. At the highest level, you need 25 times your planned annual expenses saved up to not risk running out of money (the 4% rule).

Need more info.
Age - You and DH?
Ages - Kids
Expected cost of kids' college over the x years
Expected monthly spend
Plan for medical coverage for you and DH until you get to 65
Plan for medical coverage for kids while they are in college
How much money you have saved in each type of vehicle (Roth, 401K/IRA, other)
Status of house - paid off or monthly mortgage balance for how long?

The people who manage my Roth IRA offered a financial planning service for free -- check with your bank or other financial institutions to see if they do this. One of the things we asked them to model was what would happen if we both retired at age 45; it didn't seem like it was hard for the planners to do, they just take all your assumptions about spending and college tuition etc., and stop the income assumption.

For interest, we are in our late 30s, with one preschooler for whom we'd like to pay $200k of college tuition (in current dollars), and moderate savings. As I recall the model, we could quit in our mid-40s and live comfortably into our 80s if we had no unexpected expenses and didn't mind running down our estate to 0 before we died punctually. Obviously not the recommended plan, but not as bad as I'd thought.

DH and I both feel in poor position about our jobs. We have significant expenses (3 kids in or near college).

I want to figure out scenarios where one or both of us lose jobs. We saved and are lucky to have significant $ saved
But it is various account types (iras, taxable) plus we have SS and a small pension that
Will eventually kick in.

Is there a tool or documented approach that will help us see how much income we are looking
At per year after tax. Consider medical expenses etc. it all seems daunting. I don’t want to limit ourselves now to
No real benefit later.