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Nawlens Gator
Florida Fan
louisiana
Member since Sep 2005
3934 posts

re: Am I early retirement ready? Updated

Finding a job near where you live and being home at night while drawing a military pension is a good plan. You could pay off the mortgage that way. I don't think you should retire with the numbers you posted, you'll need to work. Staying home while the kids are in school won't let you spend more time with the family anyway.

Good luck!



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12
baldona
Auburn Fan
Florida
Member since Feb 2016
8891 posts

re: Am I early retirement ready? Updated
quote:

The concept of paying my childrens' home down payments never even crossed my mind. I believe the wealth of experiences I can provide them when I have more time beats further monetary/material contributions I could provide working full-time.


I think that's awesome man. But is there really no other luxuries you and wife want? Sure, you can absolutely live perfectly fine on what you have. But you don't have a lot to splurge with. You said you want to travel, but your travel budget is going to be very minimal.

Don't forget grand kids too in the future. Depending on where your kids live, that could be a good bit of travel to see them. You could be in Louisiana and have a kid in Cali and a kid in NYC.

Plus, as said your kids will be in school. Hell, what you should do is make your wife go to work for 10 years lol. You stay home.


hungryone
LSU Fan
river parishes
Member since Sep 2010
8487 posts
 Online 

re: Am I early retirement ready? Updated
quote:

Hell, what you should do is make your wife go to work for 10 years lol. You stay home.

I actually agree with this. If she’s been a military spouse through multiple deployments (which is essentially single parenting), she might actually LIKE the opportunity to have a career/job outside the home and leave the “house holding” to you.


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31
brian_wilson
LSU Fan
Member since Oct 2016
3581 posts

re: Am I early retirement ready? Updated
quote:

I'd argue that the casually disparaged liberal arts majors are learning about self awareness, psych, and communications skills not emphasized in B schools. A solid LA degree from a quality school teaches you to read critically, think, write & speak well. Note that I said a GOOD SCHOOL....way too many inferior institutions offering terrible programs w/rampant grade inflation.


I know my liberal arts degree served me very well. Its quite useful in my day to day work, and I notice other people struggling to do some of the things that I do easily (write). Furthermore, it is very useful in business conversations. If you are sitting down with an executive in a casual setting, you are going to talk about complex topics. Being well read helps you maintain that.

WIth that said, there are a lot of shitty liberal arts degrees. It won't get a job either.

I also think parents shouldn't be expected to pay for a child's education at the expense of their own retirement. If you have enough money for everything, then sure, pay for it but pay for your retirement before little billy's schooling.

I know several people who are committed to paying for their child's higher ed. Its admirable but it probably means them working 10 more years.

Oh, and my niece goes to college in 2019. She has decided to apply to only schools out of state. She wants to major in art. Her father is unemployed, and her mother makes $50k. I feel bad for her b.c someone is steering her astray. Her top school has tuition of $40k/year. The only plus part is that she probably won't get into that school, or her 2nd choice ($80k/year).


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10
tirebiter
LSU Fan
ATL
Member since Oct 2006
6197 posts

re: Am I early retirement ready? Updated
quote:

I think I'm positioned for early retirement in the next year or so. Expecting $56k annual military pension, $1.2m saved (300 Roth,500 TSP/401k, + taxable accts). Plan to take out 30 yr mortgage w ~$1k payment using previous home's equity for down payment (not included above). No other debt. Early 40s w/ 2 kids in early elementary and wife is stay at home mom. I'll volunteer, pick up a side hustle/ part time job but don't want to be tied down w limited vacation/travel time. No one I know has done it. They all keep working full-time. What am I missing? Why shouldn't I just do it?




You're certainly in position to try out ER. Money aside, you may or may not like a lot of time available and choose to work in some capacity or not. With pension and low cost health care options you have much covered when it's something most couple are very concerned with. I would really get a handle on the housing and financial assets. I would not buy something without an extended period in ER, understanding the full impact of retirement asset withdrawals, etc. The 4% rule, than was never intended for 40+ year retirements, so I would be very cautious with that and you obviously have sound financial judgment to be where you are.

We don't have kids, I ER'd at 47, and it seems like a long time ago. My wife works 4 days a week, and is going to retire in less than 2.5 years with full pension, she is down to 4-days a week and loves her work. I don't have a pension yet we had multiple 7's in financial assets and roughly $125k left on a 2.75% mortgage when I pulled the trigger. Roughly half in taxable accounts, the rest in tax advantaged and 2 partnership investments. We keep maxing out her plan, + full HSA, and max 2 Roth's and our NW keeps climbing after spending low 6-figures annually. I would like to convert some of the 401k balances to Roth, but taxable partnership distributions are screwing that up plus 6% state tax. We are going to move out-of-state to a less humid climate when my wife retires, tired of the high density city traffic, unending road construction & chronically distracted drivers and what have become 9-month allergy seasons.

I think you can do it, even if you worked a few months a year early on it could make a big difference longer term. Hopefully your wife is in full agreement or that might be a much more challenging scenario.


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30
Foch
LSU Fan
Member since Feb 2015
475 posts

re: Am I early retirement ready? Updated
quote:

Don't forget grand kids too in the future. Depending on where your kids live, that could be a good bit of travel to see them. You could be in Louisiana and have a kid in Cali and a kid in NYC.


I’ll echo this point. You’ve spent time moving your family around and your kids may adopt a similar lifestyle as they grow older. Do they plan on joining the military (you’ve likely seen examples of people serving and their kids later serving as well or served with people who themselves had parents serve)?

Do they have the potential to raise their kids elsewhere once they grow up? It’s easier for grandparents to come visit than it is for a couple to fly young children across the country.

Also, you and your wife likely spent years doing something new and exploring the areas around new duty stations. What will happen when you find yourself a bit restless at year 4/5/6/10 in your present location? Will you have the ability to pick up and move to a new place once kids are out of the house?

Your travel budget can likely be smaller than a civilian retiree (space-A access, use of navy lodge/gateway) but will you want to deal with the hassle or will you want to pay for your family to go on trips with you once you’re a grandparent?

Only you’ve got the answers to these questions, but as someone who has a young child and is stationed a far ways away from Louisiana, I’d like to have my parents/wife’s parents visit more. We make it work, but constantly searching for cheap flight deals and driving to further airports takes a toll.
This post was edited on 8/8 at 5:34 pm


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20
CivilTiger83
Clemson Fan
Member since Dec 2017
1354 posts

re: Am I early retirement ready? Updated
quote:

Right. Home loans have the advantage of an interest tax write-off as well, at least up to a point. So a low rate mortgage can essentially serve as low-cost leverage money plus function as an inflation hedge. Needless to say though, that assumes the portfolio is not sitting with large cash positions.


Few people will be able to get any tax advantage from their mortgage with the new $24k standard deduction... The OP definitely won't. Also mortgage rates have come up... I would compare your return to 10 year Treasury bond yields... The stock market can easily fall by 50% and stay there for an extended period of time.


NC_Tigah
LSU Fan
Carolinas
Member since Sep 2003
90330 posts

re: Am I early retirement ready? Updated
quote:

Few people will be able to get any tax advantage from their mortgage with the new $24k standard deduction.
Hadn't thought about it that way. But you may be right. As income escalates, mortgage tax advantages as an inflation hedge and investment leverage would be more of an assist.

But the larger point you make is recipients of any advice here must analyze it and determine its personal applicability. Great advice for one may not help another.


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TorchtheFlyingTiger
North Carolina St. Fan
FL
Member since Jan 2008
549 posts
 Online 

re: Am I early retirement ready? Updated
Update: Accepted another 3 year assignment to a choice location and no more deployments. Now I'll retire in 2022 w $70k pension at 45 and only have to work if I choose to. Really looking forward to the great new location and the increase pension takes the uncertainty out the early retirement decision. Meanwhile, nest egg has grown to $1.3m plus $200k set aside for retirement house.


jimbeam
USA Fan
University of LSU
Member since Oct 2011
53003 posts
 Online 

re: Am I early retirement ready? Updated
You’re set man


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kywildcatfanone
Kentucky Fan
Wildcat Country!
Member since Oct 2012
59439 posts

re: Am I early retirement ready? Updated
quote:

Accepted another 3 year assignment to a choice location and no more deployments. Now I'll retire in 2022 w $70k pension at 45


I did it wrong.


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30
eng08
LSU Fan
Member since Jan 2013
3675 posts

re: Am I early retirement ready? Updated
DAMN - that’s great.


birdieman
Alabama Fan
NOLA
Member since Dec 2012
1568 posts

re: Am I early retirement ready? Updated
You are set. Do whatever you want going forward...


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PetroBabich
LSU Fan
Donetsk Oblast
Member since Apr 2017
1087 posts

re: Am I early retirement ready? Updated
quote:

Now I'll retire in 2022 w $70k pension at 45


70k pension is 50 percent of your base pay. Are you a General?


birdieman
Alabama Fan
NOLA
Member since Dec 2012
1568 posts

re: Am I early retirement ready? Updated
He gets extra points for every year past 20.


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I B Freeman
Member since Oct 2009
19778 posts

re: Am I early retirement ready? Updated
You can retire easily on that.

The $300k in the roth can pay for kids college and more. The other retirement accounts will grow.

You can buy health insurance for $10 or $12 K but doesn't that come with a military retirement?

If you pick up 20 or $25K on the side you should live fine. (In Louisiana you would not have to pay state income tax on that military pension saving you probably $4000 a year.)


lynxcat
Rutgers Fan
Member since Jan 2008
20057 posts

re: Am I early retirement ready? Updated
quote:

If you pick up 20 or $25K on the side you should live fine.


He doesn't need to do this. He is still fine.


Upperdecker
LSU Fan
BR
Member since Nov 2014
17232 posts

re: Am I early retirement ready? Updated
Why not do that? What’s he gonna do for the rest of his life? Sitting around doing nothing gets boring pretty damn fast. He should probably come up with a side business to keep himself busy once he’s done. If nothing else, just do it to keep for going into dimentia


lynxcat
Rutgers Fan
Member since Jan 2008
20057 posts

re: Am I early retirement ready? Updated
quote:

Why not do that? What’s he gonna do for the rest of his life? Sitting around doing nothing gets boring pretty damn fast. He should probably come up with a side business to keep himself busy once he’s done. If nothing else, just do it to keep for going into dimentia


The OP's ability to retire is not based on an incremental income stream. He does not need to have a side business even if you think he should do something to positively occupy his time.

Absolutely nothing wrong with him creating a side gig but the beauty of his situation is he doesn't need to do anything extra unless he chooses it.


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20
TopFlightSecurity
Arkansas Fan
Savannah, Georgia
Member since Dec 2018
275 posts

re: Am I early retirement ready? Updated
If you're honest about your numbers you are good to retire.

Guessing you're an O5 if your pension is gonna be $56k after 20 or $70k after 23.

Hope staying in was right call but I would have bounced...you're always one email away from a WIAS tasking.


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