Looking to retire early, I am 45 yrs old with ~$400k in retirement, ~400k investment, ~150k savings,
No mortgage and my wife will continue to work at part time but have medical coverage for the family. At age 62, expecting SS, and government pension ~20k
Great work saving and investing! Your biggest challenge will be inflation at age 45. If you are average in terms of life expectancy your income will need to double twice over your lifetime. Assuming your lifestyle budget is $4000 per month now, by 2034 it will be $8000 and by life expectancy $16,000 per month. So the question becomes, what percentage should I take out of my portfolio for income? Answer - 3%. Taking into account your total assets that means $30,000/year to start. Consult a good advisor to construct a portfolio that is "stress tested", and have fun! | 11.04.14 @ 23:28
You are off to a good start but there is a lot of risk in what you are proposing. As Michael said, inflation will eat away at your purchasing power and $800k is not that much when you are talking about a possible 45-50 year retirement. You need to make sure your money is working for you and be prudent in your draws from the portfolio. Sure you could go back to work but you are missing out on your prime earning years which you will never get back. Michael is right about meeting with an advisor. I'm not saying it can't be done, only that you want to make sure you have all your ducks in a row and understand what your retirement will look like over the next 50 years. | 07.28.15 @ 19:32
It would be helpful to know how much you need to spend while maintaining your lifestyle in retirement ?
To give you some numbers:
Using $800K current portfolio and $0 additions. Retiring in 15 yrs using $125K/yr in expenses while your portfolio grows at 15%CAGR gives you ~28 yrs in retirement.
Doing the same with $50K in expenses means you can go much much longer. Keep in mind GIGO.
Hope this helps. Send me a message to discuss.
It's not what you make, It's what you keep that determines your lifestyle.
| 03.17.16 @ 22:23
It's hard to answer that without knowing more about you. Visit a local advisor. Discuss your budget and your long term goals and let them put together a proven strategy that will work for you. Find someone you trust and like. They will be your advisor for a great many years. Congrats on working and saving so hard to make retiring at the age of 45 a possibility. | 04.19.16 @ 19:17