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re: For those saying $3MM net worth at age 45 would not be nearly enough to retire...
Posted on 3/27/25 at 10:47 am to VABuckeye
Posted on 3/27/25 at 10:47 am to VABuckeye
quote:
Where are you looking? We are thinking Costa del Sol probably around Alicante.
one of the finalists is San Juan right near Alicante. The other is closer to Barcelona so we have that major airport near, but we don't want to be in Barcelona so about 30 minutes away.
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Posted on 3/27/25 at 10:49 am to Sho Nuff
quote:
How do you figure? I was that person and the reason I got to $3mm in my mid 40's was because I was sacking away every fricking penny I could. I didn't live like a hermit or anything, lots of vacations (using points and miles), eating out, splurge on something here and there no problem. Our cars are 9 and 6 years old. Living in Hawaii, traveling every 2-3 months and don't spend close to $120k a year. We're not going to change more up or down, we've been doing what we like and putting money away. I will say we don't have kids and that's obviously a big difference to some folks situations, but even with kids if you need $120k/yr right now to live on it seems you're living well above your means or you're earning enough money to be able to do that and it's still pretty surprising to me to drop $10k a month (damn kids)
I drop 12k to 15k a month now with no kids and only 1 car payment and have 3 cars 21,22 and 23 model. I did a budget for the first time a few weeks ago and decided to cut back on spending to get it to around 9k to 10k per month. So far it’s going terrible
Posted on 3/27/25 at 10:50 am to VABuckeye
quote:
We are thinking Costa del Sol probably around Alicante
My grandfather’s ancestors came to the US from Alicante long ago. Before they died, my grandparents actually visited the house his ancestor was born in. Hope to visit one day, myself
Posted on 3/27/25 at 11:23 am to VABuckeye
quote:
Those people are doomsday morons. Even is you invest conservatively and make and draw 4% a year you are drawing $120k a year without touching your principle.
$120k a year goes quickly. I guess this becomes more of a lifestyle question.
Posted on 3/27/25 at 11:27 am to Motownsix
quote:
$120k a year goes quickly.
Can you share what you would spend $120k/yr on every year? I'd like to start getting an understanding of what I'm missing.
Posted on 3/27/25 at 12:00 pm to DarthRebel
quote:That 120k is before taxes, right? Unless it's all coming from a Roth.
Taking out $120,000 year is great now, but you need to go into the future with that number
Posted on 3/27/25 at 12:04 pm to Jake88
Yes, before taxes. If I retire to a state with no or little tax on my investment income I'm looking at about $10k a year in federal income taxes and $0 in state.
About $9k a month to live from after taxes. That's based off of $120k income.
About $9k a month to live from after taxes. That's based off of $120k income.
Posted on 3/27/25 at 12:07 pm to Rize
quote:
I drop 12k to 15k a month now with no kids and only 1 car payment
There has to be a lot of fat to trim there if you really want to do it.
Posted on 3/27/25 at 12:25 pm to Boss
quote:yeah, that will be a nice chunk a year until the person is 65.
How are you paying for medical insurance?
property tax and insurance will be a hit too.
Withdrawing $120,000 per year, after medical insurance and property tax/insurance, it is more like $90k...let's say another $15k for vacations, and you are down to 75k...that's 6250 per month...that will need to cover home and auto maintenance, and all meals and utilities...and subscriptions, etc.
and withdrawing money from tax deferred accounts before 59 1/2 will incur a 10% penalty...so that would need to be factored in...
plus you will pay income tax on the money withdrawn...
it will be tight living but doable for a person who has downsized and lives within their means.
This post was edited on 3/27/25 at 12:28 pm
Posted on 3/27/25 at 12:40 pm to Sho Nuff
quote:
Can you share what you would spend $120k/yr on every year?
In your 40’s? Taxes, a mortgage, insurance and kids. And honestly, with $3MM in my 40s, I wouldn’t be all that worried about making it to my late 60s or 70s, I’d be worried about worried about running out of money at the end of my life with assisted living and end of life care. That shite is expensive as frick.
As someone else mentioned, I think it’s doable, but you’d have to be very conscious of your spending and planning, and if you’ve saved that much that young, you are probably accustomed to a certain minimum lifestyle that most people really don’t want to give up
Posted on 3/27/25 at 1:36 pm to Mingo Was His NameO
Or, "If you’ve saved that much that young"
you're already accustomed to living within means, watching expenses and cutting back if necessary to meet financial goals while maintaining a comfortable but reasonable lifestyle.
you're already accustomed to living within means, watching expenses and cutting back if necessary to meet financial goals while maintaining a comfortable but reasonable lifestyle.
This post was edited on 3/27/25 at 1:45 pm
Posted on 3/27/25 at 1:42 pm to VABuckeye
quote:
I retire to a state with no or little tax on my investment income I'm looking at about $10k a year in federal income taxes and $0 in state.
If all your income is from taxable investment accounts your $10k estimate sounds high for federal since your LTCG and qualified dividends would likely be taxed at zero. Living off long term taxable investments a near zero income tax rate is feasible on $120k and much more considering basis isnt taxed again.
This post was edited on 3/27/25 at 2:08 pm
Posted on 3/27/25 at 1:44 pm to TorchtheFlyingTiger
quote:
Or, you're already accustomed to living within means, watching expenses and cutting back if necessary to meet financial goals while maintaining a comfortable but reasonable lifestyle.
Again, yes I agree to some extent for years 47-67, for example. But if you’ve been diligent through those years, you could very easily run out of money if you were diagnosed with cancer during or after that time frame of needed long term care in your final years.
I just don’t even want the chance to be a financial burden to my kids, and I don’t think you’re eliminating that by retiring in your 40s with “only” $3MM for retirement.
**there’s certainly a lot of factors with that, ie mix of investments, is there a pension, etc. I’m speaking generally
Posted on 3/27/25 at 1:54 pm to TorchtheFlyingTiger
quote:
If all your income if from taxable investment accounts your $10k estimate sounds high for federal since your LTCG and qualified dividends would likely be taxed at zero. Living off long term taxable investments a near zero income tax rate is feasible on $120k and much more considering basis isnt taxed again
About $5700 a month will be social security. I'm well past 45. I'll only have $6-7k a month to draw from investments. You're right, my estimate may be high for federal but I'd rather err high in my calculations.
Posted on 3/27/25 at 4:02 pm to VABuckeye
quote:
To keep my taxes in the 12% bracket
That's not how taxes work.
Posted on 3/27/25 at 4:29 pm to Mingo Was His NameO
quote:
Taxes, a mortgage, insurance and kids.
Ok, let's say you're dropping $10k/month because you have 1-2 kids. In your mid-late 40's, unless you started very late the kids should be coming off your coffers in the next 5 years or so if you had them early 30's. Already should be off if you had them in your 20's. So show your work on $10k/month once they're gone because people keep using kids as an expense as though that will always be there.
Here's mine:
-$4k for mortgage, ins, prop tax, utilities, etc. I have rentals on this property so in reality we pay nothing, but we'll use the $ for this exercise.
-$100/month car insurance. Cars paid off.
-$1,500 month in food and that's likely on the high end, but I'm trying to juice the #s to help.
-$500 for Wife's stuff (hair, nails, etc) again juicing #s as she doesn't do this every month. She shops though and usually buys come clothes.
-$1k towards travel (we do great trips and rarely spend much more than $10k in a year because of points and miles)
-$1k health insurance
So about $8k a month and that's juicing the #s. And like I said, for us we don't actually have that $4k because of the rentals so we're spending about $4k a month. I know not everyone can have the same situation, but $8k a month is not $10k a month. Am I missing something?
This post was edited on 3/27/25 at 4:31 pm
Posted on 3/27/25 at 5:05 pm to Billy Blanks
You don’t know what my tax situation will be in retirement. If I choose to take withdrawals from my 401k that is how it works as the withdrawals will be taxed as ordinary income. I will work my withdrawals so that my AGI puts me in the 12% bracket.
Posted on 3/27/25 at 6:18 pm to Sho Nuff
quote:
Here's mine: -$4k for mortgage, ins, prop tax, utilities, etc. I have rentals on this property so in reality we pay nothing, but we'll use the $ for this exercise. -$100/month car insurance. Cars paid off. -$1,500 month in food and that's likely on the high end, but I'm trying to juice the #s to help. -$500 for Wife's stuff (hair, nails, etc) again juicing #s as she doesn't do this every month. She shops though and usually buys come clothes. -$1k towards travel (we do great trips and rarely spend much more than $10k in a year because of points and miles) -$1k health insurance
Hope you don’t need a new car for the next 30 years and have zero long term health problems
Posted on 3/27/25 at 6:26 pm to PNW_TigerSaint
These numbers people post are dumb
Posted on 3/27/25 at 6:31 pm to Mingo Was His NameO
quote:
As someone else mentioned, I think it’s doable, but you’d have to be very conscious of your spending and planning, and if you’ve saved that much that young, you are probably accustomed to a certain minimum lifestyle that most people really don’t want to give up
I could do it, but I wouldn't be interested in taking the lifestyle cut at that age.
I'm 47, and unless I could live the lifestyle that I wanted, I wouldn't retire at this age even if I technically could on paper. I'd still do something even if I could live like I wanted. At 55 or so though sign me up
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